Quicksilver Resources declares preliminary operating results for year-end 2008.

“Quicksilver had another outstanding year of production and reserve growth at very attractive finding and development costs,” said Glenn Darden, Quicksilver president and chief executive officer. “Our low cost structure coupled with our strong hedge position is serving us well during these uncertain economic times. We are confident that our operating team will realize additional efficiencies to maximize our margins in 2009.”

Preliminary estimates of year-end 2008 proved reserves total approximately 2.2 trillion cubic feet of natural gas equivalents (Tcfe), an increase of approximately 42% from year-end 2007. By product, 2008 reserves were comprised: 74% from natural gas, 25% from natural gas liquids and 1% from crude oil. Approximately 63% of the reserves are classified as proved developed. Reserves in the Fort Worth Basin Barnett Shale totaled approximately 1.9 Tcfe at year-end 2008, an increase of approximately 58% from the prior year and reserves in Canada were approximately 333 billion cubic feet of natural gas equivalents (Bcfe).

Preliminary 2008 production totaled a record 96.2 Bcfe or 263 million cubic feet of natural gas equivalents (MMcfe) per day. Preliminary net reserve additions of approximately 755 Bcfe consisted of approximately 456 Bcfe from organic drilling activities and 299 billion cubic feet (Bcf) of acquired reserves, resulting in organic production replacement of 474% and total production replacement of 785%.

Additions to reserves from organic drilling activities were impacted by approximately 154 Bcfe in negative revisions of prior estimates, primarily due to lower prevailing prices for natural gas liquids at year-end 2008 versus 2007. Excluding these revisions the company would have organically replaced 634% of its production in 2008.

Tags: Quicksilver Resources Inc.