‘‘Differential’’ The difference between a benchmark price of oil and natural gas, such as the NYMEX crude oil spot price, and the wellhead price received.
‘‘Dry hole’’ A well found to be incapable of producing either natural gas or oil in sufficient quantities to justify completion as a natural gas or oil well.
‘‘Exit rate’’ Upstream term referring to the rate of production of oil and/or gas as of a specified date.
‘‘Exploratory well’’ A well drilled to find a new field or to find a new reservoir in a field previously found to be productive of oil or natural gas in another reservoir.
‘‘FASB’’ Financial Accounting Standards Board.
‘‘Field’’ An area consisting of a single reservoir or multiple reservoirs all grouped on or related to the same individual geological structural feature and/or stratigraphic condition. There may be two or more reservoirs in a field that are separated vertically by intervening impervious strata, or laterally by local geologic barriers, or both. Reservoirs that are associated by being in overlapping or adjacent fields may be treated as a single or common operational field. The geological terms ‘‘structural feature’’ and ‘‘stratigraphic condition’’ are intended to identify localized geological features as opposed to the broader terms of basins, trends, provinces, plays, areas of interest, etc.
‘‘Free cash flow’’ A measure of a company’s financial performance, calculated as operating cash flow minus capital expenditures. Free cash flow represents the cash that a company is able to generate after spending the money required to maintain or expand its asset base.
‘‘GAAP’’ Generally accepted accounting principles in the United States of America.
‘‘Gross acres’’ or ‘‘gross wells’’ The total acres or wells, as the case may be, in which a working interest is owned.
“Henry Hub” A natural gas pipeline located in Erath, Louisiana, that serves as the official delivery location for futures contracts on the NYMEX. The hub is owned by Sabine Pipe Line LLC and has access to many of the major gas markets in the United States.
‘‘ISDA’’ International Swaps and Derivatives Association, Inc.
‘‘Lease operating expense’’ or ‘‘LOE’’ The expenses of lifting oil or gas from a producing formation to the surface, constituting part of the current operating expenses of a working interest, and also including labor, superintendence, supplies, repairs, short-lived assets, maintenance, allocated overhead costs and other expenses incidental to production, but not including lease acquisition or drilling or completion expenses.
‘‘LIBOR’’ London interbank offered rate.
‘‘MBbl’’ One thousand barrels of oil, NGLs or other liquid hydrocarbons.
‘‘MBbl/d’’ One MBbl per day.
‘‘MBOE’’ One thousand BOE.
‘‘MBOE/d’’ One MBOE per day.
‘‘Mcf’’ One thousand cubic feet, used in reference to natural gas.
‘‘MMBbl’’ One million Bbl.
‘‘MMBOE’’ One million BOE.
‘‘MMBtu’’ One million British Thermal Units, used in reference to natural gas.
‘‘MMcf’’ One million cubic feet, used in reference to natural gas.
‘‘MMcf/d’’ One MMcf per day.
‘‘Net acres’’ or ‘‘net wells’’ The sum of the fractional working interests owned in gross acres or wells, as the case may be.
‘‘Net production’’ The total production attributable to the fractional working interest owned.