Magnum Hunter Resources Corporation (Magnum Hunter) announced a 51% increase in the quantity of the Company's estimated total proved reserves at June 30, 2012 as compared to December 31, 2011. The present value of estimated future cash flows, before income taxes, of the Company's estimated total proved reserves as of June 30, 2012, discounted at 10% ("PV-10"), increased 55% to $957.9 million from $616.9 million, as compared to six months ago at year-end 2011.
Magnum Hunter's total proved reserves increased by 22.8 million barrels of oil equivalent ("MMBoe") to 67.7 million Boe (64% crude oil & ngl; 39% proved developed producing) as of June 30, 2012 as compared to 44.9 million Boe (48% crude oil & ngl; 51% proved developed producing) at December 31, 2011. This increase was driven primarily through organic growth/extensions (14.7 MMBoe), the recent Bakken acquisition (8.7 MMBoe) and the Eagle Operating acquisition (2.2 MMBoe).
The present value (PV-10) of the Company's proved reserves at June 30, 2012 increased by $341.0 million or 55% to $957.9 million from $616.9 million at December 31, 2011. Under SEC guidelines, the commodity prices used in the June 30, 2012 and December 31, 2011 PV-10 estimates were based on the 12-month unweighted arithmetic average of the first day of the month price for the periods January 1, 2012 through June 30, 2012, and for the periods January 1, 2011 through December 31, 2011, respectively, adjusted by lease for transportation fees and regional price differentials. For crude oil and ngl volumes, the average West Texas Intermediate posted price of $95.67 per barrel at June 30, 2012, was down 0.5% from the average price of $96.19 per barrel at December 31, 2011. For natural gas volumes, the average price of the Henry Hub spot price of $3.13 per million British thermal units ("MMBTU") at June 30, 2012 was down 24% from the average price of $4.11 per MMBTU at December 31, 2011. All prices were held constant throughout the estimated economic life of the properties.
The estimates of Magnum Hunter's total proved reserves as of December 31, 2011 were prepared solely by the Company's third-party engineering consultants, Cawley Gillespie & Associates, Inc. and AJM Deloitte. For the June 30, 2012 reserve review, Cawley Gillespie & Associates, Inc. prepared the Eagle Ford and Appalachia divisions proved reserve reports, and AJM Deloitte provided an audit of the Williston Basin proved reserves, which included Canada.