EX-99 3 qmr8k030408prex991.htm EX 99.1 Exhibit 99

Exhibit 99.1.


Questar completes acquisition of Louisiana properties,

raises production and earnings guidance, and adds to hedge positions



SALT LAKE CITY – Questar Corporation (NYSE:STR) today announced that subsidiary Questar Exploration and Production Company (Questar E&P) has closed the previously announced purchase of two significant natural gas development properties in northwest Louisiana, for an aggregate adjusted purchase price of $659 million, subject to customary post-close adjustments. The properties are located in Red River and Bienville Parishes, approximately 10 miles south and east of Questar E&P’s existing Elm Grove Field operations.


Questar also revised 2008 earnings and production guidance and underlying assumptions to incorporate the newly acquired properties, the recent increase in natural gas and crude oil prices, and additional natural gas fixed-price hedges.


Revised Earnings Guidance and Assumptions

 

2008 

2008 

 

Current

Previous

Earnings per diluted share

$3.05-$3.20 

$2.90-$3.05 

Average diluted shares (millions)

176.2 

176.2 

Questar E&P production – Bcfe

160-163 

148-151 

Pinedale well completions

60-65 

60-65 

NYMEX gas price per MMBtu*

$9.00-$10.00 

$7.50-$8.50 

NYMEX/Rockies basis differential per MMBtu*

$1.45-$1.20 

$1.45-$1.20 

NYMEX/Midcontinent basis differential per MMBtu*

$1.25-$1.00 

$1.25-$1.00 

NYMEX crude oil price per bbl*

$95.00-$100.00 

$85.00-$90.00 

* On unhedged volumes for the remainder of 2008

 

 


·

Questar E&P has now hedged about 78% of forecast natural gas and oil-equivalent production for the remainder of 2008 with fixed-price swaps. Additionally, the company has hedged about 2% of its forecast natural gas production for the remainder of 2008 with basis-only swaps (see table at the end of this release).

·

The company estimates that a $1.00 per MMBtu change in the average NYMEX price of natural gas for the remainder of 2008 would result in about a $0.02 change in earnings per diluted share.

·

A $10.00 per bbl change in the average NYMEX price of oil for the remainder of 2008 would result in about a $0.05 change in earnings per diluted share.


“We’re now in a position to grow Questar E&P production 14 to 16% in 2008”, said Chuck Stanley,  Questar COO and head of the company’s exploration and production businesses. “We’ve also taken advantage of the recent jump in natural gas prices to hedge additional Questar E&P production to lock in attractive returns on invested capital and cash flows, both from the newly acquired properties and from our existing assets.”  The company has added 11 Bcf of natural gas fixed-price swaps for the remainder of 2008, 28.1 Bcf for 2009, and 28.4 Bcf for 2010 since it last disclosed hedge positions on February 12, 2008 (See table at end of this release for a detailed summary of current hedge positions).


About Questar

Questar Corp. (NYSE:STR) is a natural gas-focused energy company with an enterprise value of about $11 billion. Questar finds, develops, produces, gathers, processes, transports, stores and distributes natural gas.





Forward-Looking Statements

This release includes forward-looking statements within the meaning of Section 27(a) of the Securities Act of 1933, as amended, and Section 21(e) of the Securities Exchange Act of 1934, as amended. Such statements are based on management’s current expectations, estimates and projections, which are subject to a wide range of uncertainties and business risks. Factors that could cause actual results to differ from those anticipated are discussed in the company’s periodic filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2007. Questar undertakes no obligation to publicly correct or update the forward-looking statements in this news release, in other documents, or on the Web site to reflect future events or circumstances. All such statements are expressly qualified by this cautionary statement.


For more information, visit Questar’s website: www.questar.com.


Natural Gas Hedge Positions – March 3, 2008

Time Periods


Rocky

Mountains

Midcontinent

Total

 

Rocky

Mountains

Midcontinent

Total

 

 

 

 

 

 

Estimated

 

 

Gas (Bcf)  Fixed-Price Swaps

 

Average Price Per Mcf, Net to the Well

2008

 

 

 

 

 

 

 

 

March - June

25.3 

14.5 

39.8 

 

$6.99 

$8.06 

$7.38 

Second half

38.5 

22.9 

61.4 

 

7.00 

8.11 

7.41 

Remainder of  2008

63.8 

37.4 

101.2 

 

7.00 

8.09 

7.40 

 

 

 

 

 

 

 

 

2009

 

 

 

 

 

 

 

 

First half

28.6 

29.5 

58.1 

 

$7.07 

$8.12 

$7.61 

Second half

29.0 

30.0 

59.0 

 

7.07 

8.12 

7.61 

12 months

57.6 

59.5 

117.1 

 

7.07 

8.12 

7.61 

 

 

 

 

 

 

 

 

 

2010

 

 

 

 

 

 

 

 

First half

6.7 

26.2 

32.9 

 

$6.88 

$8.09 

$7.84 

Second half

6.8 

26.6 

33.4 

 

6.88 

8.09 

7.84 

12 months

13.5 

52.8 

66.3 

 

6.88 

8.09 

7.84 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Estimated

 

 

Gas (Bcf)  Basis-Only Swaps

 

Average Basis Per Mcf vs. NYMEX

2008

 

 

 

 

 

 

 

 

March - June

1.1 

 

1.1 

 

$1.83 

 

$1.83 

Second half

1.7 

 

1.7 

 

1.83 

 

1.83 

Remainder of 2008

2.8 

 

2.8 

 

1.83 

 

1.83 

 

 

 

 

 

 

 

 

 

2009

 

 

 

 

 

 

 

First half

8.4 

1.7 

10.1 

 

$1.27 

$1.08 

$1.24 

Second half

8.6 

1.7 

10.3 

 

1.27 

1.08 

1.24 

12 months

17.0 

3.4 

20.4 

 

1.27 

1.08 

1.24 

 

 

 

 

 

 

 

 

 



2






2010

 

 

 

 

 

 

 

First half

 

1.7 

1.7 

 

 

$0.94 

$0.94 

Second half

 

1.7 

1.7 

 

 

0.94 

0.94 

12 months

 

3.4 

3.4 

 

 

0.94 

0.94 


Crude Oil Hedge Positions – March 3, 2008


Time Periods

Rocky

Mountains

Midcontinent

Total

 

Rocky

Mountains

Midcontinent

Total

 

 

 

 

 

 

Estimated

 

 

Oil (Mbbl)  Fixed-Price Swaps

 

Average Price Per Bbl, Net to the Well

2008

 

 

 

 

 

 

 

March – June

281 

146 

427 

 

$67.39 

$70.77 

$68.55 

Second half

423 

221 

644 

 

67.39 

70.77 

68.55 

Remainder of 2008  

704 

367 

1,071 

 

67.39 

70.77 

68.55 

 

 

 

 

 

 

 

 

2009

 

 

 

 

 

 

 

First half

217 

145 

362 

 

$60.55 

$66.55 

$62.95 

Second half

221 

147 

368 

 

60.55 

66.55 

62.65 

12 months

438 

292 

730 

 

60.55 

66.55 

62.95 




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