HOUSTON, Jan. 12, 2012 /PRNewswire/ -- Cabot Oil & Gas Corporation (NYSE: COG) today announced that in the fourth quarter of 2011 the Company realized over $3.90 per Mcf for its Marcellus gas in Northeast Pennsylvania. This price is the result of the market price for the gas that averaged approximately $3.18 per Mcf and the hedged gas price of over $5.17 per Mcf, which covered 215 Mmcf per day of production.
For January, the market price for the gas sold is approximately $3.00 per Mcf, and when combined with hedges covering about half of the daily volumes at $5.20 per Mcf, the overall Marcellus realization is in excess of $4.00 per Mcf. January is the first month for deliveries to Transco that includes sales of over 200 Mmcf per day at pricing that exceeds traditional Tennessee Gas pricing. This will help temper negative swings in price for Cabot's Marcellus.
"While this is not a striking newsworthy announcement, I felt compelled to respond to the continued misinformation around our pricing that continues to find its way into discussions." said Dan O. Dinges, Chairman, President and Chief Executive Officer. "These commodity prices, while not where we want them, still afford our Marcellus project a significant rate of return around 55 to 60 percent before hedges because of their best in class characteristics."
Dinges added, "We have always been known for our discipline and this environment will not change that. We were successful in reducing our debt between 2010 and 2011, even with a robust investment program that created significant growth. We will continue to evaluate the best path forward for 2012, balancing rates of return with growth and cash flow."
Cabot Oil & Gas Corporation, headquartered in Houston, Texas is a leading independent natural gas producer with its entire resource base located in the continental United States. For additional information, visit the Company's Internet homepage at www.cabotog.com.
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Scott Schroeder (281) 589-4993
SOURCE Cabot Oil & Gas Corporation