This excerpt taken from the MRO 10-K filed Feb 27, 2009.
FACE="Times New Roman" SIZE="2">Exploration and Production
Prevailing prices for the various qualities of crude oil and
global demand, a declining dollar, ongoing concerns about supplies of
During 2008, the average spot price per barrel for WTI was
bid-week prices or first-of-month indices relative to our specific producing areas. The average Henry Hub first-of-month price index was $2.18 per thousand cubic feet (mcf) higher in 2008 than the 2007 average. Natural gas sales in
Alaska are subject to term contracts. Our other major natural gas-producing regions are Europe and Equatorial Guinea, where large portions of our natural gas sales are subject to term contracts, making realized prices in these areas less volatile.
As we sell larger quantities of natural gas from these regions, to the extent that these fixed prices are lower than prevailing prices, our reported average natural gas prices realizations may decrease. STYLE="margin-top:12px;margin-bottom:0px; text-indent:3%">E&P segment income during 2008 was up 57 percent from 2007, with revenue increases tied to these increases in average commodity prices accounting for
almost half of the income improvement. Liquid hydrocarbon and natural gas sales volumes were also higher in 2008 than 2007.