| |
Initially, we financed the acquisition
with our available cash on hand. In the near term, we expect to
establish a new project financing facility to finance the acquisition
and to fund the capital expenditure program for the Barnett Shale
play.
PINNACLE GAS RESOURCES, INC.
As of December 31, 2003, on a fully diluted
basis, assuming that all parties exercised their Pinnacle Warrants
and Pinnacle Options, the CSFB Parties, CCBM and RMG would have
ownership interests of approximately 46.2%, 26.9% and 26.9%, respectively.
In March 2004, the CSFB Parties contributed additional funds of
$11.8 million into Pinnacle to continue funding the 2004 development
program which will increase their ownership to 66.7% on a fully
diluted basis should CCBM and RMG each elect not to exercise their
available options. Assuming that CCBM and RMG exercise their Pinnacle
Stock Options, the CFSB parties' ownership interest in Pinnacle
would be 54.6% and CCBM and RMG each would own 22.7% on a fully
diluted basis.
15. SUPPLEMENTARY FINANCIAL INFORMATION
ON OIL AND NATURAL GAS EXPLORATION,
DEVELOPMENT AND PRODUCTION ACTIVITIES (UNAUDITED)
The following disclosures provide unaudited information
required by SFAS No. 69, "Disclosures About Oil and Gas Producing
Activities."
COSTS INCURRED
Costs incurred in oil and natural gas
property acquisition, exploration and development activities are
summarized below:
| (1) |
Excludes capitalized interest on unproved includes properties of $3.2
million, $3.1 million and $2.9 million for the years ended December
31, 2001, 2002 and 2003, respectively, and includes capitalized overhead
of $1.0 million, $1.0 million and $1.4 million for the years ended
December 31, 2001, 2002 and 2003, respectively. The table also includes
non-cash asset retirement obligations of $0.7 million for the year
ended December 31, 2003. |
OIL AND NATURAL GAS RESERVES
Proved reserves are estimated quantities
of oil and natural gas which geological and engineering data demonstrate
with reasonable certainty to be recoverable in future years from
known reservoirs under existing economic and operating conditions.
Proved developed reserves are proved reserves that can reasonably
be expected to be recovered through existing wells with existing
equipment and operating methods.
Proved oil and natural gas reserve quantities
at December 31, 2002 and 2003, and the related discounted future
net cash flows before income taxes are based on estimates prepared
by Ryder Scott Company and Fairchild & Wells, Inc., independent
petroleum engineers. Such estimates have been prepared in accordance
with guidelines established by the Securities and Exchange Commission.
The Company's net ownership interests
in estimated quantities of proved oil and natural gas reserves and
changes in net proved reserves, all of which are located in the
continental United States, are summarized below:
F-28
|
|
