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Pioneer Reports Third Quarter 2007 Results

DALLAS--(BUSINESS WIRE)--Nov. 6, 2007--Pioneer Natural Resources Company (NYSE:PXD) today announced financial and operating results for the quarter ended September 30, 2007.

    --  Third quarter net income of $102 million, or $.84 per diluted
        share

    --  Third quarter average daily oil and gas sales of 109,423
        barrels oil equivalent per day (BOEPD), or 100,799 BOEPD
        excluding discontinued operations in Canada

    --  A 21% increase in production from core onshore assets in
        Spraberry, Raton, Edwards and Tunisia compared to the same
        quarter of 2006

    --  Initial production from South Coast Gas in South Africa

    --  Alaskan Oooguruk project on schedule

    --  The sale of Pioneer's Canadian assets for $540 million

    --  Bolt-on acquisitions in the Spraberry field and the Barnett
        Shale totaling $240 million

    --  Three new discoveries in Tunisia and two new discoveries in
        Edwards

    --  The repurchase of 3.7 million shares at an average cost of
        $43.14 per share

Pioneer also announced that it expects 2007 all-in finding and development costs to be approximately $14 to $17 per barrel oil equivalent (BOE). Reserve replacement for 2007 is expected to be greater than 300%. The expected 2007 reserve additions are primarily attributable to continuing success in Tunisia, Spraberry, Raton and Edwards, and attractive acquisitions in Raton, Spraberry and the Barnett Shale.

Operations

In the Spraberry oil field, Pioneer has drilled approximately 300 wells year to date, and production for the third quarter of 2007 increased 14% compared to the same quarter of 2006. The Company continues to drill a majority of the wells to the deeper Wolfcamp zone resulting in incremental reserves and production of more than 20% being added to the typical Spraberry well. Today, Pioneer also separately announced a Spraberry acquisition.

In the Edwards Trend in South Texas, gas production increased 63% compared to the same quarter of 2006. Two new fields were discovered during the third quarter increasing Pioneer's new field discoveries in the Edwards expansion area to eight. The Company's 3-D seismic program is progressing well, and treating and pipeline infrastructure in the field is being expanded to handle Pioneer's increasing production.

The Raton Basin program continues to be ahead of schedule as a result of improved permitting and drilling and completion efficiencies. The Company expects that 300 new coal bed methane wells will be completed and placed online in Raton during 2007. Raton production for the third quarter of 2007 is up 11% compared to the third quarter of 2006. Pioneer continues to further enhance production by adding wellhead compression throughout the field and optimizing field pressures.

Today, Pioneer also separately announced that it has agreed to purchase additional properties in the Barnett Shale and provided an update on its initial activity.

On its operated Jenein Nord block in Tunisia, Pioneer announced two new discoveries during the third quarter, for a total of seven successful wells on the block since late 2006. The Company is constructing new facilities and expects to initiate oil production from Jenein Nord during the fourth quarter of 2007, with first sales expected in the first quarter of 2008. The three latest discoveries on the block, Farrah, Angham and Methaq, tested at a combined production rate of greater than 10,000 barrels of oil per day (BOPD). The Nadir well, a recent discovery in the Adam Concession, tested in excess of 4,000 BOPD. The acquisition of additional 3-D seismic is underway in Jenein Nord and will soon commence on the Anaguid block. Three additional wells are expected to be drilled in Tunisia before the end of the year, and 15 to 19 wells are planned for 2008.

Gas and condensate production from four wells in the South Coast Gas project offshore South Africa has been initiated. Net gas equivalent production is expected to average 15 to 20 million cubic feet per day (MMCFPD) during the fourth quarter, and one additional gas well is expected to be online by the end of the year.

In Alaska, the Company has installed the Oooguruk production modules, export pipeline and the drilling rig in order to commence drilling in December. The project is on schedule for first oil production during the first half of 2008 with first sales expected mid-year. On the Cosmopolitan project, offshore Kenai Peninsula, Pioneer is drilling a horizontal appraisal well from an onshore pad. It is anticipated that the appraisal well will be completed by the end of the year, followed by an extended production test.

Financial Review

Pioneer's third quarter net income was $102 million, or $.84 per diluted share, and included income from continuing operations of $93 million, or $.77 per diluted share. Cash flow from operating activities for the third quarter was $191 million.

Excluding discontinued operations attributable to the pending sale of the Company's Canadian assets, third quarter oil sales averaged 24,994 barrels per day (BPD), natural gas liquids sales averaged 19,997 BPD and gas sales averaged 335 MMCFPD.

The reported price for oil was $70.27 per barrel and included $11.98 per barrel related to deferred revenue from volumetric production payments (VPPs) for which production was not recorded. The price for natural gas liquids was $42.48 per barrel. The reported price for gas was $7.11 per thousand cubic feet (MCF), including $.58 per MCF related to deferred revenue from VPPs for which production was not recorded.

During the third quarter of 2007, Pioneer recorded in Other Income $28 million ($18 million or $.15 per diluted share after tax) associated with the sale of Alaskan Petroleum Production Tax (PPT) credits. The Company earns PPT credits for qualified capital expenditures that can be used to reduce future PPT liabilities, sold to third parties or refunded by the State of Alaska.

Third quarter production costs averaged $12.24 per barrel oil equivalent (BOE). DD&A expense for the quarter was $114 million, or $12.28 per BOE, and included a charge of $17 million ($11 million or $.09 per diluted share after tax), due to downward price-related proved reserve revisions for properties in the Uinta/Piceance basin as a result of extremely low Rockies spot gas prices of $.60 per MCF as of September 30, 2007. Production from Pioneer's Raton Basin properties is sold through Mid-Continent markets, and therefore Raton proved reserves were not impacted by low quarter-end prices in the Rockies.

Exploration and abandonment costs were $34 million for the quarter and included $10 million of acreage and unsuccessful drilling costs and $24 million of geologic and geophysical expenses, including seismic and personnel costs.

Considering that the South Coast Gas project is completed and that most of the investment in Oooguruk facilities will be expended by the end of 2007, Pioneer's 2008 capital budget is expected to be approximately $1 billion, in line with expected cash flow. Capital spending for 2008 will be focused primarily on onshore development activities in Spraberry, Raton, Edwards and Tunisia and offshore development drilling at Oooguruk.

Scott Sheffield, Chairman and CEO, stated, "Third quarter production from continuing operations was up 12% from the prior year quarter. This strong organic production growth coupled with the opportunity to enhance per-share performance with share repurchases give us confidence that we can achieve our 12+% compounded annual production growth target for 2007 through 2010."

Financial Outlook

Fourth quarter 2007 production from continuing operations is forecasted to average 101,000 to 106,000 BOEPD. Consistent growth is expected to continue, primarily driven by increasing production from Spraberry, Raton, Edwards, Tunisia and the South Coast Gas project in South Africa.

Fourth quarter production costs (including production and ad valorem taxes and transportation costs) are expected to average $11.75 to $12.75 per BOE based on current NYMEX strip prices for oil and gas. Depreciation, depletion and amortization expense is expected to average $10.50 to $11.50 per BOE.

Total exploration and abandonment expense during the fourth quarter is expected to be $40 million to $70 million and could include up to $45 million associated with lower-risk resource plays in the Edwards Trend in South Texas, the Rockies and Tunisia. In addition, exploration expense is expected to include up to $25 million for seismic investments and personnel, primarily related to the onshore resource plays in South Texas and Tunisia that Pioneer is currently progressing.

General and administrative expense is expected to be $30 million to $34 million. Interest expense is expected to be $38 million to $42 million, reflecting the ceasing of capitalization of interest on the South Gas Project in South Africa since it has started producing. Accretion of discount on asset retirement obligations is expected to be $2 million to $3 million.

The Company's fourth quarter effective income tax rate is expected to range from 40% to 45% based on current capital spending plans.

Fourth quarter 2007 amortization of deferred losses on terminated oil and gas hedges is expected to be $38 million. The Company's financial results, oil and gas hedges and future VPP amortization are outlined on the attached schedules.

All necessary approvals for the divestiture of Pioneer's Canadian subsidiary have been obtained, except for the purchaser's approval under the Investment Canada Act. During the fourth quarter, Pioneer expects to close the sale of its Canadian subsidiary and the initial public offering of units in Pioneer Southwest Energy Partners L.P. Proceeds from these transactions will be used to fund the previously announced acquisitions in the Rockies, Barnett Shale and Spraberry and to reduce outstanding indebtedness.

Earnings Conference Call

On Tuesday, November 6 at 10:00 a.m. Eastern Time, Pioneer will discuss its quarterly financial and operating results with an accompanying presentation. The call will be webcast on Pioneer's website, www.pxd.com. At the website, select 'INVESTOR' at the top of the page. For those who cannot listen to the live broadcast, a replay will be available shortly after the call. Or you may choose to dial (800) 310-6649 (confirmation code: 3997429) to listen to the call by telephone and view the accompanying visual presentation at the website above. A telephone replay will be available by dialing (888) 203-1112 (confirmation code: 3997429).

Pioneer is a large independent oil and gas exploration and production company, headquartered in Dallas, with operations in the United States, South Africa and Tunisia. For more information, visit Pioneer's website at www.pxd.com.

Pioneer uses the term "all-in finding and development costs per BOE" to mean total costs incurred divided by the summation of annual proved reserves, on a BOE basis, attributable to revisions of previous estimates, purchases of minerals-in-place and discoveries and extensions. Consistent with industry practice, future capital costs to develop proved undeveloped reserves are not included in costs incurred. "Reserve replacement" is the summation of annual proved reserves, on a BOE basis, attributable to revisions of previous estimates, purchases of minerals-in-place and discoveries and extensions divided by annual production of oil, NGLs and natural gas, on a BOE basis.

A registration statement relating to the common units of Pioneer Southwest Energy Partners L.P. has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold, nor may offers to buy be accepted, prior to the time the registration statement becomes effective. This communication does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

The offering of common units will be made only by means of a prospectus. A copy of the prospectus, when available, may be obtained by submitting requests to Citigroup Global Markets Inc., Attention: Prospectus Department, Brooklyn Army Terminal, 140 58th Street, 8th Floor, Brooklyn, New York 11220, phone: 718-765-6732, fax: 718-765-6734; Deutsche Bank Securities Inc., Attention: Prospectus Department, 100 Plaza One, Jersey City, New Jersey 07311, phone: 800-503-4611, or email: prospectusrequest@list.db.com; or UBS Securities LLC, Attention: Prospectus Department, 299 Park Avenue, New York, New York 10171, phone: 212-821-3000.

Except for historical information contained herein, the statements in this News Release are forward-looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements and the business prospects of Pioneer are subject to a number of risks and uncertainties that may cause Pioneer's actual results in future periods to differ materially from the forward-looking statements. These risks and uncertainties include, among other things, volatility of commodity prices, product supply and demand, competition, the ability to obtain environmental and other permits and the timing thereof, other government regulation or action, third party approvals, international operations and associated international political and economic instability, litigation, the costs and results of drilling and operations, availability of drilling equipment, Pioneer's ability to replace reserves, implement its business plans (including its plan sell its Canadian subsidiary, its plan to repurchase stock and its plan to form Pioneer Southwest Energy Partners L.P. and offer securities representing interests therein) or complete its development projects as scheduled, access to and cost of capital, the assumptions underlying production forecasts, uncertainties about estimates of reserves, quality of technical data, environmental and weather risks, acts of war or terrorism. These and other risks are described in Pioneer's 10-K and 10-Q Reports and other filings with the Securities and Exchange Commission. Pioneer undertakes no duty to publicly update these statements except as required by law.

                  PIONEER NATURAL RESOURCES COMPANY
                CONDENSED CONSOLIDATED BALANCE SHEETS
                            (in thousands)

                                            September 30, December 31,
                                                 2007         2006
                                            ------------- ------------
                                             (Unaudited)

                                ASSETS

Current assets:
  Cash and cash equivalents                  $    19,271  $     7,033
  Accounts receivable, net                       239,732      199,371
  Income taxes receivable                         88,302       24,693
  Inventories                                     98,918       95,131
  Prepaid expenses                                11,004       11,509
  Deferred income taxes                           89,077       82,927
  Discontinued operations held for sale          670,026            -
  Other current assets, net                       90,795      115,894
                                            ------------- ------------

     Total current assets                      1,307,125      536,558
                                            ------------- ------------

Property, plant and equipment, at cost:
  Oil and gas properties, using the
   successful efforts method of accounting     8,603,233    8,178,052
  Accumulated depletion, depreciation and
   amortization                               (1,940,595)  (1,895,408)
                                            ------------- ------------

     Total property, plant and equipment       6,662,638    6,282,644
                                            ------------- ------------

Deferred income taxes                              3,817          345
Goodwill                                         310,872      309,908
Other assets, net                                269,132      225,944
                                            ------------- ------------

                                             $ 8,553,584  $ 7,355,399
                                            ============= ============

   LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable                           $   362,458  $   349,820
  Interest payable                                28,415       31,008
  Income taxes payable                            17,462       12,865
  Discontinued operations held for sale          104,582            -
  Deferred revenue                               163,941      181,232
  Other current liabilities                      326,614      312,054
                                            ------------- ------------

     Total current liabilities                 1,003,472      886,979
                                            ------------- ------------

Long-term debt                                 2,610,683    1,497,162
Deferred income taxes                          1,289,401    1,172,507
Deferred revenue                                 364,636      483,279
Other liabilities and minority interests         220,666      330,801
Stockholders' equity                           3,064,726    2,984,671
                                            ------------- ------------

                                             $ 8,553,584  $ 7,355,399
                                            ============= ============
                   PIONEER NATURAL RESOURCES COMPANY
       UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
               (in thousands, except for per share data)

                           Three months ended     Nine months ended
                              September 30,         September 30,
                           ------------------- -----------------------
                             2007      2006       2007        2006
                           --------- --------- ----------- -----------

 Revenues and other
  income:
  Oil and gas              $458,898   384,112  $1,232,272   1,108,634
  Interest and other         30,991    14,017      71,051      33,576
  Gain (loss) on
   disposition of assets,
   net                          558      (436)       (860)     (3,990)
                           --------- --------- ----------- -----------
                            490,447   397,693   1,302,463   1,138,220
                           --------- --------- ----------- -----------
 Costs and expenses:
  Oil and gas production    113,554    88,687     308,380     264,741
  Depletion, depreciation
   and amortization         113,879    82,562     280,927     233,269
  Impairment of long-lived
   assets                    (2,582)        -      15,309           -
  Exploration and
   abandonments              34,498    41,006     170,143     158,671
  General and
   administrative            32,330    29,262      94,304      88,466
  Accretion of discount on
   asset retirement
   obligations                1,702       940       5,025       2,793
  Interest                   35,476    23,467      94,432      82,857
  Hurricane activity, net       110         -      60,658      38,000
  Other                       7,513    14,001      23,478      31,208
                           --------- --------- ----------- -----------
                            336,480   279,925   1,052,656     900,005
                           --------- --------- ----------- -----------
 Income from continuing
  operations before income
  taxes                     153,967   117,768     249,807     238,215
 Income tax provision       (60,948)  (39,271)    (92,181)   (113,966)
                           --------- --------- ----------- -----------

 Income from continuing
  operations                 93,019    78,497     157,626     124,249
 Income from discontinued
  operations, net of tax      8,908     2,302      10,374     587,796
                           --------- --------- ----------- -----------
 Net income                $101,927  $ 80,799  $  168,000  $  712,045
                           ========= ========= =========== ===========

 Basic earnings per share:
  Income from continuing
   operations              $   0.78  $   0.63  $     1.30  $     0.99
  Income from discontinued
   operations, net of tax      0.07      0.02        0.09        4.68
                           --------- --------- ----------- -----------
  Net income               $   0.85  $   0.65  $     1.39  $     5.67
                           ========= ========= =========== ===========

 Diluted earnings per
  share:
  Income from continuing
   operations              $   0.77  $   0.62  $     1.29  $     0.98
  Income from discontinued
   operations, net of tax      0.07      0.02        0.08        4.55
                           --------- --------- ----------- -----------
  Net income               $   0.84  $   0.64  $     1.37  $     5.53
                           ========= ========= =========== ===========

 Weighted average shares
  outstanding:
  Basic                     120,323   124,021     121,020     125,520
                           ========= ========= =========== ===========
  Diluted                   121,805   126,734     122,496     129,134
                           ========= ========= =========== ===========
                  PIONEER NATURAL RESOURCES COMPANY
      UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (in thousands)

                        Three months ended       Nine months ended
                           September 30,           September 30,
                       --------------------- -------------------------
                          2007       2006        2007         2006
                       ---------- ---------- ------------ ------------

 Cash flows from
  operating
  activities:
  Net income           $ 101,927  $  80,799  $   168,000  $   712,045
  Adjustments to
   reconcile net
   income to net cash
   provided by
   operating
   activities:
   Depletion,
    depreciation and
    amortization         113,879     82,562      280,927      233,269
   Impairment of long-
    lived assets          (2,582)         -       15,309            -
   Exploration
    expenses,
    including dry
    holes                  8,725     15,043       92,706       81,449
   Hurricane activity          -          -       66,000       42,000
   Deferred income
    taxes                 73,091     42,337      135,505      115,788
   (Gain) loss on
    disposition of
    assets, net             (558)       436          860        3,990
   Loss on
    extinguishment of
    debt                       -          -            -        8,076
   Accretion of
    discount on asset
    retirement
    obligations            1,702        940        5,025        2,793
   Discontinued
    operations             6,719     12,987       41,518     (512,835)
   Interest expense        4,092      2,357       13,305        7,522
   Commodity hedge
    related activity       5,349     (3,713)      15,982       (6,210)
   Amortization of
    stock-based
    compensation           8,461      7,047       24,816       25,357
   Amortization of
    deferred revenue     (45,578)   (47,395)    (135,934)    (143,230)
   Other noncash items     5,193      5,201        1,744       12,219
  Change in operating
   assets and
   liabilities, net of
   effects from
   acquisition and
   disposition:
   Accounts
    receivable, net      (55,383)    (1,351)     (54,821)     161,814
   Income taxes
    receivable           (27,428)       (54)     (64,026)         (69)
   Inventories             3,073    (12,990)      (6,331)     (52,113)
   Prepaid expenses       (6,723)    (1,673)      (1,213)         291
   Other current
    assets, net            5,224     (7,160)       5,037        2,047
   Accounts payable       44,334     75,160       11,748      (21,253)
   Interest payable      (12,858)    (1,202)      (2,592)     (11,476)
   Income taxes
    payable                1,697    (37,993)       4,597       17,820
   Other current
    liabilities          (41,743)   (31,552)     (80,189)     (22,624)
                       ---------- ---------- ------------ ------------
 Net cash provided by
  operating activities   190,613    179,786      537,973      656,670
 Net cash provided by
  (used in) investing
  activities            (418,625)  (367,179)  (1,405,062)     598,112
 Net cash provided by
  (used in) financing
  activities             221,206   (169,491)     877,918   (1,175,226)
                       ---------- ---------- ------------ ------------
 Net increase
  (decrease) in cash
  and cash equivalents    (6,806)  (356,884)      10,829       79,556
 Effect of exchange
  rate changes on cash
  and cash equivalents       758        (86)       1,409        1,714
 Cash and cash
  equivalents,
  beginning of period     25,319    457,042        7,033       18,802
                       ---------- ---------- ------------ ------------
 Cash and cash
  equivalents, end of
  period               $  19,271  $ 100,072  $    19,271  $   100,072
                       ========== ========== ============ ============
                   PIONEER NATURAL RESOURCES COMPANY
              UNAUDITED SUMMARY PRODUCTION AND PRICE DATA


                                  Three months ended Nine months ended
                                    September 30,      September 30,
                                  ------------------ -----------------
                                    2007     2006      2007     2006
                                  -------- --------- -------- --------

 Average Daily Sales
  Volumes from
  Continuing
  Operations:
  Oil (Bbls) -       U.S.           18,298   17,575    18,617   17,406
                     South Africa    2,368    3,513     2,599    4,287
                     Tunisia         4,328    2,299     4,062    2,393
                                  -------- --------- -------- --------
                     Worldwide      24,994   23,387    25,278   24,086
                                  ======== ========= ======== ========

  Natural gas
   liquids (Bbls) -  U.S.           19,997   18,884    18,190   18,599
                                  -------- --------- -------- --------
                     Worldwide      19,997   18,884    18,190   18,599
                                  ======== ========= ======== ========

  Gas (Mcf) -        U.S.          333,842  286,182   308,447  282,450
                     Tunisia         1,003        -     2,755        -
                                  -------- --------- -------- --------
                     Worldwide     334,845  286,182   311,202  282,450
                                  ======== ========= ======== ========

 Average Daily Sales
  Volumes from
  Discontinued
  Operations:
  Oil (Bbls) -       U.S.                -        -         -    3,208
                     Argentina           -        -         -    3,362
                     Canada            277      312       309      299
                                  -------- --------- -------- --------
                     Worldwide         277      312       309    6,869
                                  ======== ========= ======== ========

  Natural gas
   liquids (Bbls) -  Argentina           -        -         -      563
                     Canada            425      468       406      433
                                  -------- --------- -------- --------
                     Worldwide         425      468       406      996
                                  ======== ========= ======== ========

  Gas (Mcf) -        U.S.                -     (140)        -   48,195
                     Argentina           -        -         -   58,700
                     Canada         47,537   46,664    49,808   42,514
                                  -------- --------- -------- --------
                     Worldwide      47,537   46,524    49,808  149,409
                                  ======== ========= ======== ========

 Average Reported
  Prices (a):
  Oil (per Bbl) -    U.S.         $  68.28 $  70.96  $  59.38 $  66.91
                     South Africa $  79.54 $  70.68  $  70.57 $  67.25
                     Tunisia      $  73.61 $  70.79  $  66.24 $  65.13
                     Worldwide    $  70.27 $  70.90  $  61.63 $  66.79

  Natural gas
   liquids (per Bbl)
   -                 U.S.         $  42.48 $  38.73  $  38.09 $  36.15
                     Worldwide    $  42.48 $  38.73  $  38.09 $  36.15

  Gas (per Mcf) -    U.S.         $   7.11 $   6.24  $   7.27 $   6.30
                     Tunisia      $   9.83 $      -  $   7.92 $      -
                     Worldwide    $   7.11 $   6.24  $   7.27 $   6.30



 (a) Average prices are attributable to continuing operations and
  include the results of hedging activities and amortization of VPP
  deferred revenue.
                  PIONEER NATURAL RESOURCES COMPANY
          UNAUDITED SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES
                            (in thousands)

EBITDAX and discretionary cash flow ("DCF") (as defined below) are
 presented herein, and reconciled to the generally accepted accounting
 principle ("GAAP") measures of net income and net cash provided by
 operating activities because of their wide acceptance by the
 investment community as financial indicators of a company's ability
 to internally fund exploration and development activities and to
 service or incur debt. The Company also views the non-GAAP measures
 of EBITDAX and DCF as useful tools for comparisons of the Company's
 financial indicators with those of peer companies that follow the
 full cost method of accounting. EBITDAX and DCF should not be
 considered as alternatives to net income or net cash provided by
 operating activities, as defined by GAAP.


                             Three months ended    Nine months ended
                                September 30,        September 30,
                             ------------------- ---------------------
                               2007      2006       2007       2006
                             --------- --------- ---------- ----------

Net income                   $101,927  $ 80,799  $ 168,000  $ 712,045
Depletion, depreciation and
 amortization                 113,879    82,562    280,927    233,269
Impairment of long-lived
 assets                        (2,582)        -     15,309          -
Exploration and abandonments   34,498    41,006    170,143    158,671
Hurricane activity                  -         -     66,000     42,000
Loss on extinguishment of
 debt                               -         -          -      8,076
Accretion of discount on
 asset retirement
  obligations                   1,702       940      5,025      2,793
Interest expense               35,476    23,467     94,432     82,857
Income tax provision           60,948    39,271     92,181    113,966
(Gain) loss on disposition
 of assets, net                  (558)      436        860      3,990
Discontinued operations         6,719    12,987     41,518   (512,835)
Current income taxes on
 discontinued
    operations                    340       412      5,029    155,484
Cash exploration expense on
 discontinued
    operations                  1,051     1,501      4,998      2,641
Commodity hedge related
 activity                       5,349    (3,713)    15,982     (6,210)
Amortization of stock-based
 compensation                   8,461     7,047     24,816     25,357
Amortization of deferred
 revenue                      (45,578)  (47,395)  (135,934)  (143,230)
Other noncash items             5,193     5,201      1,744     12,219
                             --------- --------- ---------- ----------

    EBITDAX (a)               326,825   244,521    851,030    891,093

Cash interest expense         (31,384)  (21,110)   (81,127)   (75,335)
Current income taxes           11,803     2,654     38,295   (153,662)
                             --------- --------- ---------- ----------

    Discretionary cash flow
     (b)                      307,244   226,065    808,198    662,096

Cash exploration expense      (26,824)  (27,464)   (82,435)   (79,863)
Changes in operating assets
 and
  liabilities                 (89,807)  (18,815)  (187,790)    74,437
                             --------- --------- ---------- ----------

    Net cash provided by
     operating activities    $190,613  $179,786  $ 537,973  $ 656,670
                             ========= ========= ========== ==========


 (a)"EBITDAX" represents earnings before depletion, depreciation and
     amortization expense; impairment of long-lived assets;
     exploration and abandonments; noncash hurricane activity; loss on
     extinguishment of debt; accretion of discount on asset retirement
     obligations; interest expense; income taxes; loss on the
     disposition of assets; noncash effects from discontinued
     operations; commodity hedge related activity; stock-based
     compensation; amortization of deferred revenue; and other noncash
     items.
(b) Discretionary cash flow equals cash flows from operating
     activities before changes in operating assets and liabilities and
     before cash exploration expense.
                  PIONEER NATURAL RESOURCES COMPANY

                       SUPPLEMENTAL INFORMATION
                        As of November 2, 2007

                    Open Commodity Hedge Positions

                                2007
                              ---------
                               Fourth
                               Quarter      2008       2009      2010
                              --------- --------- ---------- ---------

   Average Daily Oil
    Production Hedged:
   Swap Contracts:
       Volume (Bbl)              9,500    15,250      8,000     4,000
       NYMEX price (Bbl)      $  73.56  $  61.36   $  71.57  $  71.46
   Collar Contracts:
       Volume (Bbl)              5,000     3,000      2,000         -
       NYMEX price (Bbl)
       Ceiling                $  76.04  $  80.80   $  76.50  $      -
       Floor                  $  63.00  $  65.00   $  65.00  $      -
   Average Daily Natural Gas
    Liquid Production Hedged:
   Swap Contracts:
     Volume (Bbl)                    -       500        500       500
     Blended index price
      (Bbl) (a)               $      -  $  44.33   $  41.75  $  39.63
   Average Daily Gas
    Production Hedged:
   Swap Contracts:
     Volume (MMBtu)            205,054   129,167      9,897     2,500
     NYMEX price (MMBtu) (b)  $   8.41  $   8.61   $   9.00  $   8.07

(a) Represents blended Mont Belvieu posted price per Bbl.
(b) Approximate, based on historical differentials to index prices.

Amortization of Deferred Revenue Associated with Volumetric Production
                  Payments and Net Derivative Losses
                            (in thousands)

                                2007
                              ---------
                               Fourth
                               Quarter    2008    Thereafter   Total
                              --------- --------- ---------- ---------

   Total deferred revenues
    (a)                       $ 45,297  $158,138   $325,142  $528,577
   Less derivative losses to
    be recognized in pretax
    earnings (b)                  (347)   (4,373)   (12,744)  (17,464)
                              --------- --------- ---------- ---------

   Total VPP impact to pretax
    earnings                  $ 44,950  $153,765   $312,398  $511,113
                              ========= ========= ========== =========


(a) Deferred revenue will be amortized as increases to oil and gas
     revenues during the indicated future periods.
(b) Represents the remaining pretax earnings impact of the derivatives
     assigned in the VPPs.
                  PIONEER NATURAL RESOURCES COMPANY

                       SUPPLEMENTAL INFORMATION
                        As of November 2, 2007

               Deferred Losses on Terminated Hedges (a)
----------------------------------------------------------------------
                            (in thousands)


                                   2007
                                 ---------
                                  Fourth
                                  Quarter    2008     2009  Thereafter
                                 --------- --------- ------ ----------

Commodity hedge losses (b)       $ 31,615  $ 94,487  $   -    $     -
Debt hedge losses (c)                 119       488    541      5,203
                                 --------- --------- ------ ----------

    Total deferred losses        $ 31,734  $ 94,975  $ 541    $ 5,203
                                 ========= ========= ====== ==========


(a) Excludes deferred hedge gains and losses on terminated derivatives
     related to the VPPs.
(b) Deferred commodity hedge losses will be amortized as decreases to
     oil and gas revenues during the indicated future periods.
(c) Deferred debt hedge losses will be amortized as increases to
     interest expense during the indicated future periods.

CONTACT: Pioneer Natural Resources Company
Investors:
Frank Hopkins/Scott Rice, 972-444-9001
or
Media and Public Affairs:
Susan Spratlen, 972-444-9001

SOURCE: Pioneer Natural Resources Company

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