Consolidated Natural Gas Co. (CNG) set records for both reserveadditions and production for 1998. Reserve additions in explorationand production totaled 413 Bcfe through additions, revisions, andpurchases, topping the company record of 368 Bcfe set in 1985.Included are 39 Bcf of reserves bought from The Peoples Natural GasCo., a CNG distribution company, late in 1998.

Reserve additions were 204% of production, the fifth straightyear additions surpassed 150% of production. CNG now has 1.7 Tcfeof reserves, an increase of about 58% since the end of 1993. CNGproduced 202 Bcfe of gas in 1998, topping the company record of 199Bcfe set in 1997. The breakdown was 154.9 Bcf of gas and 7.9million barrels of oil. Production has increased 67% the last threeyears, and CNG expects a 20% increase in 1999 as new projects comeon line.

“Our record reserve additions and record production cameprimarily from our superb operations in the Gulf of Mexico,” saidGeorge A. Davidson Jr., CEO of the Pittsburgh-based company. “We’veused the latest technology and our expertise to find energy andproduce it economically in what some call a difficult area tosucceed.”

Production has begun at a new complex in the Gulf’s Main Passarea, the Nautilus-Atlantis-Nemo complex, with full productionexpected by the end of February. The complex has three platforms,eight wells and facilities designed to handle initialdeliverability of 240 MMcf of gas and 20,000 barrels of condensatea day. CNG owns 68.5% of Nautilus, 75% of Atlantis, 100% of Nemoand is the operator of the complex.

CNG’s finding and development costs of 83 cents/Mcfe for 1998were lower than the 88 cents/Mcfe in 1997. “We have put together anefficient E&P operation that can succeed even when prices arelow,” said Pat Riley, president of CNG Producing Co. “We have aquality E&P staff, a growing program both onshore and offshore,and we believe that the U.S. oil and natural gas business presentsvery attractive, long-term opportunities.”

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