Constellation Energy Partners LLC (NYSE MKT: CEP) today reported second quarter 2012 results. The company produced 3,142 MMcfe during the second quarter for average daily net production of 34.5 MMcfe for the quarter, which is a 3% decline versus the first quarter 2012. Net oil production for the second quarter was 324 barrels per day, or approximately 29.5 thousand barrels in total, which is unchanged from the first quarter 2012. Year-to-date, the company produced 6,368 MMcfe for average daily net production of 35.0 MMcfe. The company reported revenue of $11.8 million for the second quarter 2012, which includes revenue from sales of $8.7 million, revenue from hedge settlements of $7.3 million, a non-cash loss on mark-to-market activities of $4.9 million, and revenue from services provided to third parties of $0.7 million. Approximately 67% of the company’s sales revenue during the quarter was from natural gas sales and 33% was from oil sales. Taken together, the company’s revenue from sales and hedge settlements totaled $16.0 million in the second quarter, which compares to $16.2 million in the first quarter 2012. Operating costs, which include lease operating expenses, production taxes and general and administrative expenses, net of certain non-cash items, averaged $3.24 per Mcfe for the second quarter 2012, which is a 5% improvement versus the first quarter 2012. For the year-to-date, operating costs averaged $3.32 per Mcfe. Adjusted EBITDA for the second quarter 2012 was $6.3 million, which is a 6% improvement versus the first quarter 2012. Adjusted EBITDA for the year-to-date was $12.2 million. On a GAAP basis, the company recorded a net loss of $5.0 million for the quarter and net income of $0.9 million for the year-to-date. Capital spending for the year-to-date totaled $6.9 million. The company completed 33 net wells and recompletions on capital spending of $4.2 million in the second quarter. The additional wells resulted in 48 net wells and recompletions for the year-to-date, and the company finished the quarter with an additional 24 net wells and recompletions in progress. Drilling activities in 2012 are focused on oil potential in the company’s existing asset base as well as capital efficient recompletions. The company continues to fund its capital program using cash flow from operations.