Question-and-Answer Session
Operator
(Operator Instructions). And our first question comes from Carl Kirst from BMO Capital. Your line is open.
Carl Kirst - BMO Capital Markets
Thanks. Good morning everybody. James, you'd opened talking about the revisions on the reserves, 188 Bs and you'd mentioned that two-thirds were price related. Can you give us a sense of what comprised the other one-third 65 or so Bcf?
James McManus, II
Yeah, let me do this Carl. I've got Johnny Richardson with me. He's President and Chief Operating Officer of Energen Resources. And why don't you do this -- if this is okay, Carl, I'll get Johnny to do a reconciliation of where we started the year to the end of year and then specifically he can give you some color on those reserve revisions.
Carl Kirst - BMO Capital Markets
Please.
John Richardson
Thanks for the question, Carl. Yeah, I'll start out as James requested and tell that at the end of last year 12/31/07; you'll recall Energen had proved reserves of 1.75 Tcf. We produced 102.4, as James just told you, last year. We also took around 120 Bcf write-down due to commodity prices falling. So we had a demo division of that.
Now the other 65 days or so, of course, there's always adds and revisions -- there's always upward adds and downward revisions in those. But the 65 does include 2 unusual items; another 15 Bcf of that 65 was due to increased LOE, which also impacted our reserves and 30 Bcf included in that 65 number was due to sort of change in our practices in the San Juan where as our production grows we find we need to have more moving equipment, lower pipeline pressures and so forth which is a good thing, but it does cost us fuel. And so as we've looked at what we are going to do in the future we thought it was right to realize that this fuel burn which would impact us about 30 Bs. Now as an addition, we did have an add of 124 Bcf equivalent primarily from our P2 and P3 inventory and we were quite pleased with that.
James McManus, II
So Carl normally our normal noise is pretty small, it's usually in the 30 Bcf area; it's a little bit higher; at twice that amount this year but as Johnny outlined 15 of it because LOE was going to cause some of those tail life reserves to go a little non-economic. Now if LOE goes way back down to the drilling cost we'll get those back and then 30 Bs is due to the fact that we are going to be using some of the reserves for fuel in the San Juan.
- To read the full transcript on Seeking Alpha, click here »
