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Last updated on April 19, 2014 at 1:20 EDT

Noble Energy Announces Fourth Quarter And Full Year 2012 Results, Including Record Sales Volumes And Cash Flow

February 7, 2013

HOUSTON, Feb. 7, 2013 /PRNewswire/ — Noble Energy, Inc. (NYSE: NBL) reported today fourth quarter 2012 net income of $251 million, or $1.39 per share diluted, and net income from continuing operations(1) of $277 million, or $1.54 per share diluted. Excluding the impact of an unrealized commodity derivatives gain and an asset impairment charge, fourth quarter 2012 adjusted net income from continuing operations(2) was $296 million, or $1.65 per share diluted. During the fourth quarter 2011, the Company had a net loss from continuing operations of $314 million, or $1.77 per share diluted, and adjusted net income from continuing operations(2) of $277 million, or $1.55 per share diluted.

Discretionary cash flow from continuing operations(2) for the fourth quarter 2012 was a record $824 million compared to $710 million for the same quarter in 2011. Net cash provided by operating activities was $762 million and capital expenditures(3) for the quarter were $1.1 billion.

Key highlights for the fourth quarter of 2012 include:

  • Record quarterly cash flow of $824 million and record annual cash flow of $2.9 billion for 2012
  • Record sales volume from continuing operations of 255 thousand barrels of oil equivalent per day (MBoe/d) and 239 MBoe/d for the year
  • DJ Basin volumes increased to 86 MBoe/d with horizontal production contributing 39 MBoe/d, 45 percent of the total volumes
  • Production in the Marcellus Shale averaged 121 million cubic feet equivalent per day (MMcfe/d) net, a 19 percent increase over third quarter 2012
  • Discovery at Big Bend in the Gulf of Mexico
  • New reservoir discovery at Carla offshore Equatorial Guinea
  • Tamar platform installed and commissioning process initiated
  • Announced a strategic partner in the Leviathan leases offshore Israel

Noble Energy reported full year 2012 net income of $1.0 billion, or $5.71 per share diluted, compared to net income of $453 million, or $2.54 per share diluted, in 2011. Adjusted net income from continuing operations(1) for 2012 was $889 million, or $4.95 per share diluted, compared to $904 million, or $5.06 per share diluted, in 2011. Discretionary cash flow from continuing operations(1) was $2.9 billion for the year, up 21 percent from 2011, and net cash provided by operating activities for the year was $2.9 billion, up 32 percent from 2011. Total year capital expenditures(2) were $3.6 billion.

Charles D. Davidson, Noble Energy’s Chairman and CEO, commented, “Delivering record quarterly cash flow of more than $800 million in the fourth quarter was an excellent culmination to an exciting year of growth for Noble Energy and has set the stage for an even better year in 2013. Record sales, with liquids accounting for 47 percent of the volumes, were a strong contributor to the quarterly results. In particular, crude and condensate sales grew more than 17 percent from the previous quarter. In 2013, we anticipate another exciting year of growth as we deliver 20 percent production growth over 2012 after adjusting for our 2012 property sales. We plan to bring Tamar and Alen to first production while continuing to grow our U.S. production from the DJ Basin and Marcellus. To support future growth, we intend to sanction this year another wave of major projects that will likely include a Phase 2 of Tamar in Israel, a Phase 1 of Leviathan also in Israel, Carla offshore West Africa, and Gunflint and Big Bend in the Gulf of Mexico. While we move these projects into development, we will also be testing significant exploration prospects including the Paraiso well offshore Nicaragua, Leviathan deep offshore Israel, and multiple prospects in the Gulf of Mexico.”

Fourth quarter 2012 sales volumes from continuing operations averaged 255 MBoe/d, up 18 percent from the fourth quarter 2011, after adjusting for assets divested in 2012. Production volumes were 254 MBoe/d with the difference attributable to the timing of crude oil liftings in Equatorial Guinea. The sales volume split for the quarter was 47 percent liquids, 24 percent international natural gas, and 29 percent U.S. natural gas.

U.S. volumes totaled 149 MBoe/d for the fourth quarter 2012, up 31 percent from the same quarter last year excluding volumes from divested assets. The increase was attributed to growth from the horizontal plays in the DJ Basin and Marcellus, and from the Gulf of Mexico largely due to the addition of Galapagos. Natural production declines were experienced in the remaining non-core U.S. assets.

Sales volumes from international assets were 106 MBoe/d for the final quarter of 2012, an increase of 9 percent from the fourth quarter of 2011, excluding volumes from discontinued operations in the UK. The increase was due to production from the Aseng oil project offshore Equatorial Guinea offset slightly by lower natural gas sales in Israel.

Crude oil prices averaged $97.98 per barrel, down 2 percent versus the fourth quarter 2011. Natural gas realizations in the U.S. averaged $3.09 per thousand cubic feet (Mcf), down 10 percent from the fourth quarter of 2011, and averaged $5.29 per Mcf in Israel. Natural gas liquid pricing in the U.S. averaged $36.86 per barrel for the quarter, representing 40 percent of the Company’s average U.S. crude oil realization.

Total production costs per barrel of oil equivalent (Boe), including lease operating expense (LOE), production and ad valorem taxes, and transportation were $7.97 per Boe, up 1 percent from the last quarter of 2011. LOE and depreciation, depletion, and amortization (DD&A) per Boe were $5.20 and $16.33, respectively. LOE rates were impacted primarily by an increase in facilities costs in the Gulf of Mexico. The increase in DD&A rates were due to increased liquids production from the DJ Basin and Gulf of Mexico, as well as the addition of natural gas production from the Noa and Pinnacles fields offshore Israel. Exploration expense for the fourth quarter 2012 was $86 million, which included costs associated with seismic acquisition in Nevada and offshore Falkland Islands. General and administrative expenses were up primarily due to increased staffing for major development and exploration activities. The Company recorded a $31 million asset impairment related to Mari-B offshore Israel. The adjusted effective tax rate for the fourth quarter 2012 was 19 percent with 45 percent deferred.

OPERATIONS UPDATE

In the DJ Basin, production averaged 86 MBoe/d for the fourth quarter, a 15 percent increase over last quarter. The horizontal program accounted for 39 MBoe/d of production, 45 percent of the total. Crude oil and other liquid sales rose to 51 thousand barrels of oil per day (MBbl/d) or 59 percent. In the quarter, 53 wells were drilled and 63 were completed – contributing to full year totals of 200 wells drilled and 193 completed. Six of the wells drilled in the quarter were extended-reach lateral wells. Average production from three initial extended-reach lateral wells is showing minimal decline and appears to be exceeding the 750 thousand Boe type curve. All 15 wells in the 40-acre spacing pilot program were completed and are in early stages of flowback operations. The Company operated eight rigs in the DJ Basin with two in Northern Colorado and six in the Greater Wattenberg Area. To support the development programs in Northern Colorado, the Company sanctioned the development of the Keota Gas Plant with a processing capacity of 30 million cubic feet per day (MMcf/d). Noble Energy will operate the plant, which is scheduled to start up in the second quarter of 2014.

In the Marcellus Shale, net production averaged 121 MMcfe/d for the fourth quarter, up 19 percent from last quarter. The Company operated three horizontal rigs in the wet gas area where 20 wells from three pads are online. Production from the wet gas area was 14 MMcfe/d net for the quarter. In the dry gas area, Consol operated two rigs and production averaged 107 MMcf/d net for the quarter. Noble Energy and Consol drilled a total of 25 wells and brought 13 online during the quarter contributing to full year totals of 89 and 71 wells, respectively.

In the Eastern Mediterranean, contribution from the Noa and Pinnacles fields resulted in production of 118 MMcf/d net, essentially unchanged from the previous quarter. The Tamar jacket and topside facilities were installed in December and commissioning operations have begun. Initial production is scheduled to commence in April and be combined with Mari-B platform production to meet the growing domestic demand. The appraisal of Leviathan continues with the Leviathan 4 well currently drilling.

PROVED RESERVES

Estimated reserves at year-end 2012 were approximately 1.2 billion barrels of oil equivalent (BBoe), up 3 percent after adjusting for non-core asset divestitures. Reserves in the U.S. accounted for 49 percent of the total, with International contributing the remaining 51 percent. Reserves are split 30 percent global liquids, 42 percent international natural gas, and 28 percent U.S. natural gas.

Noble Energy added total proved reserves of 121 million barrels of oil equivalent (MMBoe) in 2012, including revisions. These additions replaced 136 percent of 2012 production.

U.S. net additions of 105 MMBoe resulted in 207 percent replacement of U.S. production and were driven by the horizontal drilling programs in the DJ Basin and Marcellus Shale. These net additions included negative revisions of 94 MMBoe associated with the termination of the vertical program in Wattenberg and 26 MMBoe associated with dry gas fields due to lower natural gas prices.

The international portfolio added net 16 MMBoe of reserves, or 42 percent replacement of international production, with most of the additions due to strong reservoir performance at Aseng and further appraisal of Tamar. No proved reserves have been booked for major projects expected to be sanctioned in 2013, including Leviathan.

UPDATED GUIDANCE

The full year volume guidance range for 2013 remains unchanged at 270 to 282 MBoe/d. First quarter 2013 volumes are expected to average 238 to 242 MBoe/d. The volume forecast for the first quarter includes over 4 thousand barrels of oil per day underliftings in West Africa and the impact of maintenance at Swordfish in the Gulf of Mexico. Volumes will ramp up throughout the year with the initiation of production at Tamar in April and at Alen in the third quarter, as well as from the continued acceleration of activity in the DJ Basin and the Marcellus Shale wet gas area.

Expense guidance ranges for the year are also unchanged. Unit rates in the first quarter for LOE are expected to average $6.20 to $6.60 per Boe.

    (1)            Noble Energy has divested the
                   majority of its North Sea
                   properties and has reclassified
                   the results of its entire North
                   Sea operations as discontinued
                   operations for all accounting
                   periods presented in this
                   release. See Schedule 7 for a
                   financial summary of
                   discontinued operations.
    (2)            A Non-GAAP measure, see
                   attached Reconciliation
                   Schedules
    (3)            Capital expenditures exclude the
                   second installment payment
                   associated with the Marcellus
                   acquisition

WEBCAST AND CONFERENCE CALL INFORMATION

Noble Energy, Inc. will host a webcast and conference call at 9:00 a.m. Central time today. The webcast is accessible on the ‘Investors’ page at www.nobleenergyinc.com. Conference call numbers for participation are 888-293-6979 or 719-325-2289 with the passcode 4391329. A replay will be available on the website.

Noble Energy is a leading independent energy company engaged in worldwide oil and gas exploration and production. The Company has core operations onshore in the U.S., primarily in the DJ Basin and Marcellus Shale, in the deepwater Gulf of Mexico, offshore Eastern Mediterranean, and offshore West Africa. Noble Energy is listed on the New York Stock Exchange and is traded under the ticker symbol NBL. Further information is available at www.nobleenergyinc.com.

This news release contains certain “forward-looking statements” within the meaning of federal securities law. Words such as “anticipates,” “believes,” “expects,” “intends,” “will,” “should,” “may,” and similar expressions may be used to identify forward-looking statements. Forward-looking statements are not statements of historical fact and reflect Noble Energy’ s current views about future events. They include estimates of oil and natural gas reserves and resources, estimates of future production, assumptions regarding future oil and natural gas pricing, planned drilling activity, future results of operations, projected cash flow and liquidity, business strategy and other plans and objectives for future operations. No assurances can be given that the forward-looking statements contained in this news release will occur as projected, and actual results may differ materially from those projected. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks and uncertainties that could cause actual results to differ materially from those projected. These risks include, without limitation, the volatility in commodity prices for crude oil and natural gas, the presence or recoverability of estimated reserves, the ability to replace reserves, environmental risks, drilling and operating risks, exploration and development risks, competition, government regulation or other actions, the ability of management to execute its plans to meet its goals and other risks inherent in Noble Energy’s business that are discussed in its most recent annual report on Form 10-K and in other reports on file with the Securities and Exchange Commission. These reports are also available from Noble Energy’s offices or website, http://www.nobleenergyinc.com. Forward-looking statements are based on the estimates and opinions of management at the time the statements are made. Noble Energy does not assume any obligation to update forward-looking statements should circumstances or management’s estimates or opinions change.

This news release also contains certain historical and forward-looking non-GAAP measures of financial performance that management believes are good tools for internal use and the investment community in evaluating Noble Energy’s overall financial performance. These non-GAAP measures are broadly used to value and compare companies in the crude oil and natural gas industry. Please also see Noble Energy’s website at http://www.nobleenergyinc.com under “Investors” for reconciliations of the differences between any historical non-GAAP measures used in this news release and the most directly comparable GAAP financial measures. The GAAP measures most comparable to the forward-looking non-GAAP financial measures are not accessible on a forward-looking basis and reconciling information is not available without unreasonable effort.

                                                                                                                                   Schedule 1
                                                                                                                               Noble Energy, Inc.
                                                                                                 Reconciliation of Net Income to Adjusted Net Income from Continuing Operations
                                                                                                               (in millions, except per share amounts, unaudited)

                                                  Three Months Ended December 31,                   Year Ended December 31,
                                                  -------------------------------                   -----------------------
                                                                2012                Per                            2011                      Per                                  2012    Per          2011    Per
                                                                                  Share,                                                   Share,                                       Share,                Share,
                                                                                  Diluted                                                  Diluted                                      Diluted              Diluted
                                                                                  -------                                                  -------                                      -------              -------
    Net Income                                                  $251                      $1.39                   $(296)                           $(1.67)                      $1,027          $5.71  $453          $2.54
    Discontinued Operations, Net
     of Tax                                                       26                       0.15                     (18)                            (0.10)                         (62)         (0.34)  (41)         (0.23)
                                                                 ---                       ----                     ---                             -----                          ---          -----   ---          -----
    Income from Continuing
     Operations                                                  277                       1.54                    (314)                            (1.77)                         965           5.37   412           2.31
    Unrealized (gains) losses on
     commodity derivative
     instruments                                                 (36)                     (0.20)                    162                              0.91                         (109)         (0.61)   22           0.12
    (Gain) loss on                                                13                       0.07                       1                              0.01                         (154)         (0.85)  (25)         (0.14)
    divestitures [1]
    Asset                                                         31                       0.18                     620                              3.48                          104           0.58   757           4.24
    impairments [2]
    Drilling rig                                                   -                          -                       -                                 -                            -              -    18           0.10
    expense [3]
    Other adjustments                                              -                          -                      (1)                            (0.01)                           -              -     4           0.02
                                                                 ---                        ---                     ---                             -----                          ---            ---   ---           ----
    Total adjustments before tax                                   8                       0.05                     782                              4.39                         (159)         (0.88)  776           4.34
    Income Tax                                                    11                       0.06                    (191)                            (1.07)                          83           0.46  (284)         (1.59)
    Effect of
    Adjustments [4]

    Adjusted Net Income from
     Continuing Operations                                      $296                      $1.65                    $277                             $1.55                         $889          $4.95  $904          $5.06
                                                                ----                      -----                    ----                             -----                         ----          -----  ----          -----
    Weighted average number of shares outstanding
    Diluted                                                      180                                                177                                                            180                  179
    NOTE:            Adjusted net income from continuing operations should
                   not be considered a substitute for net income as
                   reported in accordance with GAAP. Adjusted net
                   income from continuing operations is provided for
                   comparison to earnings forecasts prepared by
                   analysts and other third parties. Our management
                   believes, and certain investors may find, that
                   adjusted net income from continuing operations is
                   beneficial in evaluating our financial performance
                   as it excludes the impact of significant non-cash
                   items. We believe such measures can facilitate
                   comparisons of operating performance between periods
                   and with our peers. See Schedule 2: Summary
                   Statement of Operations.

    [1]   During the third quarter of 2012, we completed the sale
          of certain non-core onshore U.S. properties as well as
          certain North Sea properties. During the second quarter
          of 2011, we completed the transfer of assets and exit
          from Ecuador.

    [2]   Amount for 2012 represents impairments of our South
          Raton assets in the Deepwater Gulf of Mexico, due to
          declines in near-term crude oil prices, our Piceance
          development onshore U.S., because of recent declines in
          realized natural gas prices, and the fourth quarter
          impairment of our Mari-B, Pinnacles and Noa fields,
          offshore Israel due to end-of-field life declines in
          production. Amount for 2011 represents impairments of
          certain of our onshore U.S. developments, primarily in
          East Texas due to field performance combined with a
          significant decline in natural gas prices, specifically
          during fourth quarter 2011.

    [3]   Amount for 2011 represents stand-by rig expense
          incurred prior to receiving permits to resume drilling
          activities, which were suspended under the Federal
          Deepwater Moratorium, in the deepwater Gulf of Mexico.

    [4]   The net tax effects are determined by calculating the
          tax provision for GAAP Net Income, which includes the
          adjusting items, and comparing the results to the tax
          provision for adjusted earnings from continuing
          operations, which excludes the adjusting items. The
          difference in the tax provision calculations represents
          the tax impact of the adjusting items listed here. The
          calculation is performed at the end of each quarter
          and, as a result, the tax rates for each discrete
          period may be different.

                                                                            Schedule 2
                                                                        Noble Energy, Inc.
                                                                 Summary Statement of Operations
                                                        (in millions, except per share amounts, unaudited)

                              Three Months Ended                        Year Ended
                                 December 31,                          December 31,
                                 ------------                          ------------
                                                  2012                                    2011               2012    2011
                                                  ----                                    ----               ----    ----
    Revenues
    Crude oil and condensate                      $866                                    $571             $3,205  $2,034
    Natural gas                                    191                                     213                620     883
    NGLs                                            55                                      67                212     262
    Income from equity method
     investees                                      55                                      46                186     193
    Other revenues                                   -                                       -                  -      32
                                                   ---                                     ---                ---     ---
    Total revenues                               1,167                                     897              4,223   3,404
                                                 -----                                     ---              -----   -----
    Operating Expenses
    Lease operating expense                        122                                      96                431     346
    Production and ad valorem
     taxes                                          39                                      38                151     146
    Transportation and
     gathering expense                              26                                      19                 91      66
    Exploration expense                             86                                      85                409     277
    Depreciation, depletion
     and amortization                              383                                     259              1,370     878
    General and
     administrative                                 98                                      87                384     339
    (Gain) loss on
     divestitures                                   13                                       1               (154)    (25)
    Asset impairments                               31                                     620                104     757
    Other operating (income)
     expense, net                                    8                                      39                 25      86
                                                   ---                                     ---                ---     ---
    Total operating expenses                       806                                   1,244              2,811   2,870
                                                   ---                                   -----              -----   -----
    Operating Income                               361                                    (347)             1,412     534
    Other (Income) Expense
    (Gain) Loss on commodity
     derivative instruments                        (29)                                    136                (75)    (42)
    Interest, net of amount
     capitalized                                    30                                      14                125      65
    Other (income) expense,
     net                                             4                                      25                  6       9
                                                   ---                                     ---                ---     ---
    Total other (income)
     expense                                         5                                     175                 56      32
                                                   ---                                     ---                ---     ---
    Income (Loss) from
     Continuing Operations
     Before Taxes                                  356                                    (522)             1,356     502
    Income Tax Provision
     (Benefit)                                      79                                    (208)               391      90
                                                   ---                                    ----                ---     ---
    Income (Loss) from
     Continuing Operations                         277                                    (314)               965     412
    Discontinued Operations,
     Net of Tax [1]                                (26)                                     18                 62      41
                                                   ---                                     ---                ---     ---
    Net Income (Loss)                             $251                                   $(296)            $1,027    $453
                                                  ----                                   -----             ------    ----
    Earnings Per Share
    Basic
    Income (Loss) from
     continuing operations                       $1.56                                  $(1.77)             $5.43   $2.34
    Discontinued operations,
     net of tax                                  (0.15)                                   0.10               0.34    0.23
                                                 -----                                    ----               ----    ----
    Net Income (Loss)                            $1.41                                  $(1.67)             $5.77   $2.57
                                                 -----                                  ------              -----   -----
    Diluted
    Income (Loss) from
     continuing operations                       $1.54                                  $(1.77)             $5.37   $2.31
    Discontinued operations,
     net of tax                                  (0.15)                                   0.10               0.34    0.23
                                                 -----                                    ----               ----    ----
    Net Income (Loss)                            $1.39                                  $(1.67)             $5.71   $2.54
                                                 -----                                  ------              -----   -----
    Weighted average number
     of shares outstanding
    Basic                                          178                                     177                178     176
    Diluted                                        180                                     177                180     179
    [1]             Represents our North Sea
                    operations reclassified as
                    held for sale at June 30,
                    2012. See Schedule 7:
                    Discontinued Operations.

                            Schedule 3
                        Noble Energy, Inc.
                   Volume and Price Statistics
                           (unaudited)

                     Three Months Ended                Year Ended
                        December 31,                  December 31,
                        ------------                  ------------
                           2012                  2011      2012      2011
                           ----                  ----      ----      ----
    Crude Oil and
     Condensate
     Sales Volumes
     (MBbl/d)
    United States            58                    39        49        38
    Equatorial
     Guinea                  34                    19        33        14
    China                     4                     4         4         4
                            ---                   ---       ---       ---
    Total
     consolidated
     operations              96                    62        86        56
    Equity method
     investee                 2                     2         2         2
                            ---                   ---       ---       ---
    Total sales
     volumes                 98                    64        88        58
                            ---                   ---       ---       ---
    Crude Oil and
     Condensate
     Realized
     Prices
     ($/Bbl)
    United States        $91.08                $95.45    $94.69    $95.19
    Equatorial
     Guinea              108.62                105.90    110.14    107.57
    China                106.06                109.37    114.54    106.19
                         ------                ------    ------    ------
    Consolidated
     average
     realized
     prices              $97.98                $99.62   $101.52    $99.17
                         ------                ------   -------    ------
    Natural Gas
     Sales Volumes
     (MMcf/d)
    United States           447                   432       438       388
    Equatorial
     Guinea                 245                   250       235       245
    Israel                  118                   150       101       173
                            ---                   ---       ---       ---
    Total
     consolidated
     operations             810                   832       774       806
                            ---                   ---       ---       ---
    Natural Gas
     Realized
     Prices
     ($/Mcf)
    United States         $3.09                 $3.42     $2.61     $3.90
    Equatorial
     Guinea                0.27                  0.27      0.27      0.27
    Israel                 5.29                  5.10      4.85      4.86
                           ----                  ----      ----      ----
    Consolidated
     average
     realized
     prices               $2.56                 $2.78     $2.19     $3.00
                          -----                 -----     -----     -----
    Natural Gas
     Liquids (NGL)
     Sales Volumes
     (MBbl/d)
    United States            17                    16        16        15
    Equity method
     investee                 5                     6         5         5
                            ---                   ---       ---       ---
    Total sales
     volumes                 22                    22        21        20
                            ---                   ---       ---       ---
    Natural Gas
     Liquids
     Realized
     Prices
     ($/Bbl)
    United States        $36.86                $46.11    $35.36    $48.35
    Barrels of Oil
     Equivalent
     Volumes
     (MBoe/d)
    United States           149                   127       139       117
    Equatorial
     Guinea                  75                    61        72        56
    Israel                   20                    25        17        29
    China                     4                     4         4         4
                            ---                   ---       ---       ---
    Total
     consolidated
     operations             248                   217       232       206
                            ---                   ---       ---       ---
    Equity method
     investee                 7                     7         7         7
                            ---                   ---       ---       ---
    Total barrels
     of oil
     equivalent
     from
     continuing
     operations             255                   224       239       213
    Total barrels
     of oil
     equivalent
     from
     discontinued
     operations
     [1]                      2                     9         5         9
                            ---                   ---       ---       ---
    Total barrels
     of oil
     equivalent             257                   233       244       222
                            ---                   ---       ---       ---
    [1]             Represents our North Sea
                    operations reclassified as
                    held for sale at June 30,
                    2012. See Schedule 7:
                    Discontinued Operations.

                                                Schedule 4
                                            Noble Energy, Inc.
                                         Condensed Balance Sheets
                                               (in millions)

                                                    December 31,          December 31,
                                                    ------------          ------------
                                                                     2012                 2011
                                                                     ----                 ----
    ASSETS
    Current Assets
    Cash and cash equivalents                                      $1,387               $1,455
    Accounts receivable, net                                          964                  783
    Other current assets                                              420                  180
                                                                      ---                  ---
    Total current assets                                            2,771                2,418
    Net property, plant and equipment                              13,551               12,782
    Goodwill                                                          635                  696
    Other noncurrent assets                                           597                  548
                                                                      ---                  ---
    Total Assets                                                  $17,554              $16,444
                                                                  -------              -------
    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current Liabilities
    Accounts payable - trade                                       $1,508               $1,343
    Other current liabilities                                       1,024                  925
                                                                    -----                  ---
    Total current liabilities                                       2,532                2,268
    Long-term debt                                                  3,736                4,100
    Deferred income taxes                                           2,218                2,059
    Other noncurrent liabilities                                      810                  752
                                                                      ---                  ---
    Total Liabilities                                               9,296                9,179
    Total Shareholders' Equity                                      8,258                7,265
                                                                    -----                -----
    Total Liabilities and Shareholders'
     Equity                                                       $17,554              $16,444
                                                                  -------              -------

                                                                                         Schedule 5
                                                                                     Noble Energy, Inc.
                                                Discretionary Cash Flow from Continuing Operations and Reconciliation to Operating Cash Flow
                                                                                  (in millions, unaudited)

                                     Three Months Ended                                  Year Ended
                                        December 31,                                    December 31,
                                        ------------                                    ------------
                                                             2012                                            2011                                2012     2011
                                                             ----                                            ----                                ----     ----
    Adjusted Net Income from
     Continuing Operations [1]                             $296                                            $277                                $889     $904
    Adjustments to reconcile
     adjusted net income from
     continuing operations to
     discretionary cash flow from
     continuing operations:
    Depreciation, depletion and
     amortization                                           383                                             259                               1,370      878
    Exploration expense                                      86                                              86                                 409      277
    (Income)/Dividends from equity
     method investments, net                                  3                                               7                                   7       30
    Deferred compensation (income)
     expense                                                  8                                              23                                   6        8
    Deferred income taxes                                    32                                              34                                 149      207
    Stock-based compensation expense                         16                                              15                                  65       58
    Other                                                     -                                               9                                  (1)      10
                                                            ---                                             ---                                 ---      ---
    Discretionary Cash Flow from
     Continuing Operations                                 $824                                            $710                              $2,894   $2,372
                                                           ----                                            ----                              ------   ------
    Reconciliation to Operating Cash
     Flows
    Net changes in working capital                           (7)                                           (259)                                134     (156)
    Cash exploration costs                                  (66)                                            (35)                               (193)    (173)
    Current tax expense of earnings
     adjustments                                             18                                               5                                   -        -
    Drilling rig expense [2]                                  -                                               -                                   -      (18)
    Impact of Discontinued
     Operations                                              (9)                                            (36)                                 82      126
    Other adjustments                                         2                                               -                                  16       19
                                                            ---                                             ---                                 ---      ---
    Net Cash Provided by Operating
     Activities                                            $762                                            $385                              $2,933   $2,170
                                                           ----                                            ----                              ------   ------

    Capital expenditures (accrual
     based)                                              $1,083                                          $1,041                              $3,626   $3,026
    Marcellus Shale Asset
     Acquisition[3]                                           -                                              75                                   -    1,308
    Increase in FPSO lease
     obligation                                               -                                              10                                   -       66
                                                            ---                                             ---                                 ---      ---
    Total Capital Expenditures
     (Accrual Based)                                     $1,083                                          $1,126                              $3,626   $4,400
                                                         ------                                          ------                              ------   ------
    NOTE:                     The table above reconciles
                            discretionary cash flow
                            from continuing operations
                            to net cash provided by
                            operating activities. While
                            discretionary cash flow
                            from continuing operations
                            is not a GAAP measure of
                            financial performance, our
                            management believes it is a
                            useful tool for evaluating
                            our overall financial
                            performance. Among our
                            management, research
                            analysts, portfolio
                            managers and investors,
                            discretionary cash flow
                            from continuing operations
                            is broadly used as an
                            indicator of a company's
                            ability to fund exploration
                            and production activities
                            and meet financial
                            obligations. Discretionary
                            cash flow from continuing
                            operations is also commonly
                            used as a basis to value
                            and compare companies in
                            the oil and gas industry.

    [1]            See Schedule 1: Reconciliation
                   of Net Income to Adjusted Net
                   Income from Continuing
                   Operations.

    [2]            Amount for 2011 represents
                   stand-by rig expense incurred
                   prior to receiving permits to
                   resume drilling activities,
                   which were suspended under the
                   Federal Deepwater Moratorium,
                   in the deepwater Gulf of
                   Mexico.

    [3]            Includes $73 million
                   representing our initial
                   investment in CONE Gathering
                   LLC for year-ended December
                   31, 2011.

                                                                            Schedule 6
                                                                        Noble Energy, Inc.
                                                            Effect of Commodity Derivative Instruments
                                                                     (in millions, unaudited)

                                   Three Months Ended                        Year Ended
                                      December 31,                          December 31,
                                      ------------                          ------------
                                                      2012                                    2011     2012  2011
                                                      ----                                    ----     ----  ----
    (Gain) Loss on Commodity
     Derivative Instruments
    Crude Oil
    Realized                                           $15                                      $8      $83   $44
    Unrealized                                         (24)                                    173     (120)    5
                                                       ---                                     ---     ----   ---
    Total Crude Oil                                     (9)                                    181      (37)   49
                                                       ---                                     ---      ---   ---
    Natural Gas
    Realized                                            (9)                                    (33)     (49) (108)
    Unrealized                                         (12)                                    (11)      11    17
                                                       ---                                     ---      ---   ---
    Total Natural Gas                                  (21)                                    (44)     (38)  (91)
                                                       ---                                     ---      ---   ---
    Total (Gain) Loss on Commodity
     Derivative Instruments                           $(30)                                   $137     $(75) $(42)
                                                      ----                                    ----     ----  ----

                                                                                    Schedule 7
                                                                                Noble Energy, Inc.
                                                                             Discontinued Operations
                                                                 (in millions, except volume amounts, unaudited)

                                     Three Months Ended                              Year Ended
                                        December 31,                                December 31,
                                        ------------                                ------------
                                                           2012                                       2011          2012     2011
                                                           ----                                       ----          ----     ----
    Summary Statement of
     Discontinued Operations:
    Oil and gas revenues                                    $14                                        $86          $208     $357
    Production expense                                        5                                         15            44       58
    Exploration expense                                      26                                          -            29        2
    Depreciation, depletion and
     amortization                                             -                                         25            33       87
    General and administrative                                1                                          -             3        2
    Asset impairments                                         -                                          -             -        2
    Other (income) expense, net                              (3)                                        (6)           (2)      (9)
                                                            ---                                        ---           ---      ---
    Income (Loss) Before Income
     Taxes                                                  (15)                                        52           101      215
    Current tax expense                                      16                                         31            80      175
    Deferred tax expense (benefit)                          (11)                                         3           (25)      (1)
                                                            ---                                        ---           ---      ---
    Operating Income (Loss), Net of
     Tax                                                    (20)                                        18            46       41
    Gain (Loss) on Sale, Net of Tax                          (6)                                         -            16        -
                                                            ---                                        ---           ---      ---
    Income (Loss) From Discontinued
     Operations                                            $(26)                                       $18           $62      $41
                                                           ----                                        ---           ---      ---
    Volume and Price Statistics:
    Crude Oil and Condensate Sales
     Volumes (MBbl/d)                                         1                                          8             5        8
    Crude Oil and Condensate
     Realized Prices ($/Bbl)                            $109.56                                    $112.90       $112.94  $112.97
    Natural Gas Sales Volumes (MMcf/
     d)                                                       5                                          4             4        5
    Natural Gas Realized Prices
     ($/Mcf)                                              $9.39                                      $9.09         $8.62    $8.11

                                                    Schedule 8
                                                Noble Energy, Inc.
                                                 Supplemental Data
                                             (in millions, unaudited)

    2012 Costs Incurred in
     Oil and Gas
     Activities            United States                              Int'l [1]         Total
                           -------------                              --------          -----
    Unproved property
     acquisition costs                      $68                                    $28           $96
    Exploration costs                       335                                    354           689
    Development costs [2]                 1,839                                  1,154         2,993
                                          -----                                  -----         -----
    Total costs incurred                 $2,242                                 $1,536        $3,778
                                         ------                                 ------        ------

    Reconciliation to
     Capital Spending
     (accrual basis)
    Total costs incurred                                                                      $3,778
    Exploration overhead                                                                        (110)
    Lease rentals                                                                                 (7)
    Asset retirement
     obligations                                                                                (145)
                                                                                                ----
    Total oil and gas
     spending                                                                                  3,516
    CONE LLC investment                                                                           41
    Other capital                                                                                 69
                                                                                                 ---
    Total capital spending
     (accrual basis)                                                                          $3,626
                                                                                              ------

    Proved Reserves [3]    United States                              Int'l [4]         Total
                           -------------                              --------          -----
    Total Barrel Oil
     Equivalents (MMBoe)
    Beginning reserves -
     December 31, 2011                      573                                    636         1,209
    Revisions of previous
     estimates                             (101)                                     4           (97)
    Extensions,
     discoveries and other
     additions                              206                                     12           218
    Purchase of minerals
     in place                                 -                                      -             -
    Sale of minerals in
     place                                  (52)                                    (5)          (57)
    Production                              (51)                                   (38)          (89)
                                            ---                                    ---           ---
    Ending reserves -
     December 31, 2012                      575                                    609         1,184
                                            ---                                    ---         -----
    Proved Developed
     Reserves (MMBoe)
    December 31, 2011                       333                                    171           504
    December 31, 2012                       303                                    158           461
    [1]            International includes
                   Cameroon, China,
                   Cyprus, Equatorial
                   Guinea, Falkland
                   Islands, Israel, the
                   North Sea, Senegal/
                   Guinea-Bissau,
                   Nicaragua, Sierra
                   Leone and other new
                   ventures.

    [2]            Includes ARO costs of
                   $73 million for
                   United States and $72
                   million for Int'l.

    [3]            Netherland, Sewell &
                   Associates, Inc.
                   performed a reserves
                   audit for 2012 and
                   concluded that the
                   Company's estimates
                   of proved reserves
                   were, in the
                   aggregate, reasonable
                   and have been
                   prepared in
                   accordance with
                   Standards Pertaining
                   to the Estimating and
                   Auditing of Oil and
                   Gas Reserves
                   Information
                   promulgated by the
                   Society of Petroleum
                   Engineers.

    [4]            International includes
                   China, Equatorial
                   Guinea, Israel, and
                   The North Sea.

SOURCE Noble Energy


Source: PR Newswire