UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
Report (Date of Earliest Event Reported): February 1,
2010
COMSTOCK
RESOURCES, INC.
(Exact
Name of Registrant as Specified in Charter)
|
STATE
OF NEVADA
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001-03262
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94-1667468
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(State
or other
jurisdiction
incorporation)
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(Commission
File Number)
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(I.R.S.
Employer
Identification
Number)
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5300
Town And Country Boulevard
Suite
500
Frisco,
Texas 75034
(Address
of principal executive offices)
(972)
668-8800
(Registrant's
Telephone No.)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
7.01 Regulation FD Disclosure
On February
1, 2010 we issued a press release, attached hereto as Exhibit 99.1 and
incorporated herein by reference, announcing our fourth quarter 2009 production
and estimated proved oil and gas reserves as of December 31, 2009.
In accordance
with General Instruction B.2 of Form 8-K, the information in this report,
including Exhibit 99.1, shall not be deemed "filed" for purposes of Section 18
of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject
to the liabilities of that section, nor shall such information be deemed
incorporated by reference in any filing under the Securities Act of 1933 or the
Exchange Act, except as shall be expressly set forth by specific reference in
such filing.
Item
9.01 Financial Statements and Exhibits
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Exhibit 99.1
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Press
Release, dated February 1, 2010.
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SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, as amended, the registrant
has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
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COMSTOCK
RESOURCES, INC.
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Dated: February
2, 2010
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By:
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/s/
M. JAY ALLISON
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M.
Jay Allison
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President
and Chief Executive Officer
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Exhibit 99.1
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5300 Town and
Country Blvd., Suite 500
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 |
Frisco, Texas
75034
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Telephone:
(972) 668-8800
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Contact:
Roland O. Burns
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Sr. Vice
President and Chief Financial Officer
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Web Site:
www.comstockresources.com
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NEWS
RELEASE
For Immediate
Release
COMSTOCK
RESOURCES, INC. ANNOUNCES
25%
INCREASE IN PROVED OIL AND GAS RESERVES AND
27%
INCREASE IN FOURTH QUARTER PRODUCTION RATE
FRISCO, TEXAS,
February 1, 2010 -- Comstock Resources, Inc. ("Comstock" or the
"Company")(NYSE:CRK) announced today that its production in 2009 increased to
65.5 billion cubic feet of natural gas equivalent ("Bcfe") or 179.4 million
cubic feet equivalent ("MMcfe") per day. 2009 production increased 9%
over 2008's production and was 13% higher than 2008's pro forma production
excluding production from properties divested of in 2008. 93% of
2009's production was natural gas and 7% was oil. Fourth quarter 2009
production of 19.1 Bcfe or 207.5 MMcfe per day increased 27% over production in
the fourth quarter of 2008 and was 13% higher than production in the third
quarter of 2009.
Comstock
also announced that its proved oil and natural gas reserves as of December 31,
2009 were estimated at 682 billion cubic feet ("Bcf") of natural gas and 7.2
million barrels of crude oil or 726 Bcfe, an increase of 25% as compared to
total proved reserves as of December 31, 2008 of 582 Bcfe. Yearend
proved reserves were 94% natural gas and 55% were classified as proved
developed. Comstock operates 90% of the proved reserve
base. The present value, using a 10% discount rate, of the future net
cash flows before income taxes of the proved reserves (the "PV 10 Value") was
approximately $489.1 million, using average first of the month 2009 prices of
$3.54 per Mcf for natural gas and $49.60 per barrel for oil. The PV
10 Value is different than the standardized measure of discounted estimated
future net cash flows which is calculated after income taxes.
The
proved reserves as of December 31, 2009 are calculated based on new Securities
and Exchange Commission ("SEC") guidelines that went into effect for the
Company's yearend 2009 oil and gas reserve reporting. The revisions
to the guidelines were intended to modernize and update the rules to align them
with current practices and changes in technology. Changes in the
Company's proved reserve estimates compared with the methodology used at the end
of 2008 based on the prior SEC rules include:
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·
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Oil
and natural gas prices used to determine proved reserves were based on the
simple 12-month average of the first day of the month oil and natural gas
prices received by the Company rather than the year-end market prices
prescribed by the old method. Under the old method, commodity
prices used to calculate proved reserves would have been $5.29 per Mcf for
natural gas and $64.43 per barrel for oil as compared to the significantly
lower prices of $3.54 per Mcf and $49.60 per barrel prices determined
under the new method.
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·
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The
new guidelines have expanded the definition of proved undeveloped reserves
that can be included based on an existing producing well. The
2009 proved reserves include one additional offsetting undeveloped
location for certain of the Company's Haynesville shale producing wells
which had the impact of increasing the total proved undeveloped reserves
by 31 Bcfe.
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·
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The
new guidelines also limit the inclusion of proved undeveloped reserves to
those reserves that are scheduled to be developed within five years, which
had an impact of reducing the Company's proved reserves by 49
Bcfe.
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Due to
the change in guidelines and the particularly low natural gas price used to
calculate reserves compared with prior years, the Company believes it would be
helpful to also present proved reserves using the December 31, 2009 market
prices that would have been used under the old rules.
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Oil
Price
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Natural
Gas
Price
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Oil
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Natural
Gas
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Natural
Gas Equivalent
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PV
10
Value
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|||||
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($
per bbl)
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($
per Mcf)
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(MMbbls)
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(Bcf)
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(Bcfe)
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(million
$)
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|||||
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$49.60
$64.43
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$3.54
$5.29
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7.2
7.6
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682.4
754.2
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725.7
800.0
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$489.1
$1,151.9
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The
following table reflects the changes in the proved reserve estimates since the
end of 2008:
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Proved
Reserves
Using
New SEC
2009
Prices
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Proved
Reserves
Using
Yearend
Market
Prices
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|||||||
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(Bcfe)
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(Bcfe)
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|||||||
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Proved
Reserves at December 31, 2008
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581.7
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581.7
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||||||
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2009 Production
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(65.5
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) |
(65.5
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) | ||||
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2009 Divestitures
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(0.8
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) |
(0.8
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) | ||||
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2009 Reserve Additions, Including Revisions
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210.3
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284.6
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||||||
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Proved
Reserves at December 31, 2009
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725.7
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800.0
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||||||
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2009
Reserve Replacement Ratio (%)
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321
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% |
435
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% | ||||
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2009
Oil and Gas Expenditures (million $)
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$345.4
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$345.4
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||||||
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2009
Finding Costs ($ per Mcfe)
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$1.64
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$1.21
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||||||
Comstock's
successful Haynesville shale drilling program was the primary driver of the
growth in production and proved reserves in 2009. The Haynesville
shale program added 325 Bcfe of proved reserves in 2009 out of the 350 Bcfe of
total 2009 reserve discoveries. These additions were offset in part
by downward revisions of 140 Bcfe which were primarily attributable to the low
average natural gas price used to determine the proved reserves and the
exclusion of certain proved undeveloped reserves that are not expected to be
drilled within the proscribed five year period required by the new SEC
rules.
Comstock
has planned a conference call for 9:30 a.m. Central Time on Tuesday, February
9, 2010,
to discuss the operational and financial results for the 2009 fourth quarter and
full year including the yearend proved reserves estimates. Investors
wishing to participate should visit our website at www.comstockresources.com for
a live web cast or dial 1-866-800-8651 (international dial-in use 617-614-2704)
and provide access code 91062875 when prompted. If you are unable to
participate in the original conference call, a web replay will be available
approximately 24 hours following the completion of the call on Comstock's
website at www.comstockresources.com. The web replay will be
available for approximately one week.
This
press release may contain "forward-looking statements" as that term is defined
in the Private Securities Litigation Reform Act of 1995. Such
statements are based on management's current expectations and are subject to a
number of factors and uncertainties which could cause actual results to differ
materially from those described herein. Although the Company believes
the expectations in such statements to be reasonable, there can be no assurance
that such expectations will prove to be correct.
Comstock
Resources, Inc. is an independent energy company based in Frisco, Texas and is
engaged in oil and gas acquisitions, exploration and development primarily in
Louisiana and Texas. The Company's stock is traded on the New York
Stock Exchange under the symbol CRK.