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News Release

Cabot Oil & Gas Announces Second Quarter Results
 

HOUSTON, July 23 /PRNewswire-FirstCall/ -- Cabot Oil & Gas Corporation (NYSE: COG) today reported second quarter net income of $25.5 million, or $0.25 per share. Removing the selected items, (which are detailed in the Selected Items Table and include the loss related to the sale of the Company's Canadian operations), the quarter's net income was $39.1 million, or $0.38 per share. These figures compare to the 2008 second quarter numbers (for both the reported results and after the removal of selected items) of $54.6 million, or $0.55 per share, and $69.9 million, or $0.71 per share, for net income respectively.

Cash flow from operations for the 2009 second quarter totaled $147.9 million, while discretionary cash flow was $133.6 million. Comparatively, 2008 second quarter cash flow from operations was $143.7 million, and discretionary cash flow was $147.1 million.

"This marks our 25th consecutive quarter of profitability," said Dan O. Dinges, Chairman, President and Chief Executive Officer. "These results include a ten percent increase in second quarter 2009 equivalent production over the second quarter of 2008 but also reflect a reduced commodity price realization." The production growth rate was driven by a 42 percent increase in the East region and a 20 percent increase in the Gulf Coast region for comparable year over year quarters. On the pricing front, even with the hedge benefit, the price realization fell short of last year. Realized natural gas prices were $7.25 per Mcf in the 2009 second quarter versus $9.30 per Mcf in the 2008 second quarter. Realized oil prices fell 15 percent to $83.76 per barrel.

In terms of cost comparisons, overall reported expenses were higher, but per unit levels were lower in this second quarter versus last year's second quarter. The higher components of DD&A, interest and exploration expense are related to the impact of the August 2008 east Texas acquisition.

Year-to-Date

In the six months ended June 30, 2009, Cabot reported net income of $73.1 million, or $0.71 per share, compared to $100.6 million, or $1.03 per share, for the same period last year. The cash flow comparisons for the six months ended June 30, 2009 and June 30, 2008, respectively, are cash flow from operations of $300.4 million versus $276.4 million and discretionary cash flow of $271.7 million versus $285.5 million. The 2009 six-month net income figure, after removal of the selected items, was $81.3 million, or $0.78 per share, versus $126.9 million, or $1.29 per share for the six-month period ended June 30, 2008.

"The same dynamic that drove the quarter results apply to the year-to-date periods - increased production and lower price realizations," stated Dinges. "Production was up approximately 13 percent while natural gas and oil prices each fell 14 percent." Expenses including financing costs were up three percent between the six-month year-to-date comparable periods.

Conference Call

Listen in live to Cabot Oil & Gas Corporation's second quarter financial and operating results discussion with financial analysts on Friday, July 24, 2009 at 9:30 a.m. EDT (8:30 a.m. CDT) at www.cabotog.com. A teleconference replay will also be available at (800) 642-1687, (U.S./Canada) or (706) 645-9291 (International), pass code 18590704. The replay will be available through Sunday, July 26, 2009. The latest financial guidance, including the Company's hedge positions, along with a replay of the web cast, which will be archived for one year, are available in the investor relations section of the Company's website at www.cabotog.com.

Cabot Oil & Gas Corporation, headquartered in Houston, Texas is a leading independent natural gas producer, with its entire resource base located in the continental United States. For additional information, visit the Company's Internet homepage at www.cabotog.com.

The statements regarding future financial performance and results and the other statements which are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties, including, but not limited to, market factors, the market price (including regional basis differentials) of natural gas and oil, results of future drilling and marketing activity, future production and costs, and other factors detailed in the Company's Securities and Exchange Commission filings.

                                 OPERATING DATA

                                              Quarter Ended   Six Months Ended
                                                 June 30,         June 30,
                                                 --------         --------
                                              2009     2008    2009     2008
                                              ----     ----    ----     ----
    PRODUCED NATURAL GAS (Bcf) & OIL (MBbl)
    Natural Gas
     East                                      8.4      5.9    15.7     11.9
     Gulf Coast                                9.3      7.7    19.7     15.1
     West                                      6.2      7.1    12.4     13.5
     Canada                                    0.4      1.4     1.0      2.6
                                               ---      ---     ---      ---
     Total                                    24.3     22.1    48.8     43.1
                                              ====     ====    ====     ====

    Crude/Condensate/Ngl
     East                                        5        6       9       12
     Gulf Coast                                147      136     300      280
     West                                       44       43      79       79
     Canada                                      2        5       6       11
                                                --       --      --       --
     Total                                     198      190     394      382
                                               ===      ===     ===      ===

    Equivalent Production (Bcfe)              25.6     23.2    51.2     45.4

    PRICES
     Average Produced Gas Sales Price ($/Mcf)
     East                                    $7.09    $9.64   $7.67    $8.96
     Gulf Coast                              $8.79   $10.36   $8.55    $9.35
     West                                    $5.36    $8.04   $5.45    $7.67
     Canada                                  $3.22    $8.41   $3.40    $7.91
     Total (1)                               $7.25    $9.30   $7.38    $8.63

    Average Crude/Condensate Price ($/Bbl)
     East                                   $54.24  $118.33  $46.90  $103.89
     Gulf Coast                             $94.51   $91.87  $90.72   $88.11
     West                                   $52.15  $118.18  $43.37  $108.12
     Canada                                 $45.14   $96.89  $36.46   $87.26
     Total (1)                              $83.76   $98.68  $79.55   $92.58

    WELLS DRILLED
     Gross                                      33      116      82      201
     Net                                        28       97      65      162
     Gross Success Rate                        100%      99%     98%      99%

    (1)  These realized prices include the realized impact of derivative
         instrument settlements.




                                            Quarter Ended     Six Months Ended
                                               June 30,            June 30,
                                               --------            --------
                                             2009     2008      2009     2008
                                             ----     ----      ----     ----
         Realized Impacts to Gas Pricing    $4.15   $(0.97)    $3.74   $(0.48)
         Realized Impacts to Oil Pricing   $30.78  $(21.19)   $34.87  $(14.88)



                CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
                         (In thousands, except per share amounts)

                                         Quarter Ended       Six Months Ended
                                            June 30,             June 30,
                                            --------             --------
                                         2009      2008       2009      2008
                                         ----      ----       ----      ----
    Operating Revenues
      Natural Gas Production          $176,213  $202,689   $360,735  $369,248
      Brokered Natural Gas              11,704    27,188     45,085    62,808
      Crude Oil and Condensate          16,210    18,600     30,452    35,087
      Other                                697       377      2,491     1,362
                                           ---       ---      -----     -----
                                       204,824   248,854    438,763   468,505
    Operating Expenses
      Brokered Natural Gas Cost         10,684    24,140     40,433    54,430
      Direct Operations - Field
       and Pipeline                     23,073    22,636     48,552    40,127
      Exploration                       10,397     7,290     16,863    12,351
      Depreciation, Depletion
       and Amortization                 61,838    48,401    126,930    94,668
      General and Administrative
       (excluding Stock-Based
       Compensation)                    10,946    11,782     22,882    21,779
      Stock-Based Compensation (1)       6,171    21,695     11,300    39,271
      Taxes Other Than Income           10,914    19,225     23,812    36,122
                                        ------    ------     ------    ------
                                       134,023   155,169    290,772   298,748
    Gain / (Loss) on Sale of
     Assets (2)                        (16,562)      401     (3,855)      401
                                       -------       ---     ------       ---
    Income from Operations              54,239    94,086    144,136   170,158
    Interest Expense and Other          15,046     6,207     29,272    12,198
                                        ------     -----     ------    ------
    Income Before Income Taxes          39,193    87,879    114,864   157,960
    Income Tax Expense                  13,691    33,254     41,782    57,360
                                        ------    ------     ------    ------
    Net Income                         $25,502   $54,625    $73,082  $100,600
                                       =======   =======    =======  ========
    Net Earnings Per Share - Basic       $0.25     $0.55      $0.71     $1.03
    Weighted Average Common
     Shares Outstanding                103,640    98,467    103,581    98,092

    (1) Includes the impact of the Company's performance share awards and
        restricted stock amortization as well as expense related to stock
        options and stock appreciation rights.  Also includes expense for the
        Supplemental Employee Incentive Plans which commenced in 2008.
    (2) The loss on sale of assets in 2009 primarily relates to a loss on our
        April 2009 sale of our Canadian properties, partially offset by a
        gain on sale of assets from the first quarter 2009 sale of the
        Thornwood properties in the East.



                 CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
                                  (In thousands)

                                          June 30,         December 31,
                                            2009               2008
                                            ----               ----
    Assets
    Current Assets                       $370,822            $460,551
    Property, Equipment and Other
     Assets                             3,252,862           3,241,113
                                        ---------           ---------
    Total Assets                       $3,623,684          $3,701,664
                                       ==========          ==========

    Liabilities and Stockholders'
     Equity
    Current Liabilities                  $265,127            $378,913
    Long-Term Debt, excluding
     Current Maturities                   795,000             831,143
    Deferred Income Taxes                 628,234             599,106
    Other Liabilities                      98,851             101,940
    Stockholders' Equity                1,836,472           1,790,562
                                        ---------           ---------
    Total Liabilities and
     Stockholders' Equity              $3,623,684          $3,701,664
                                       ==========          ==========




           CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
                                  (In thousands)

                                        Quarter Ended      Six Months Ended
                                          June 30,             June 30,
                                          --------             --------
                                       2009       2008      2009       2008
                                       ----       ----      ----       ----
    Cash Flows From Operating
     Activities
    Net Income                       $25,502    $54,625   $73,082   $100,600
    Unrealized (Gain) / Loss
     on Derivatives                      126      2,909      (815)     2,909
    Income Charges Not
     Requiring Cash                   69,151     50,692   140,443    114,498
    (Gain) / Loss on Sale of Assets   16,562       (401)    3,855       (401)
    Deferred Income Tax Expense       11,903     31,955    38,252     55,515
    Changes in Assets and
     Liabilities                      14,210     (8,005)   28,705     (9,061)
    Stock-Based Compensation Tax
     Benefit                               -      4,642         -          -
    Exploration Expense               10,397      7,290    16,863     12,351
                                      ------      -----    ------     ------
    Net Cash Provided by
     Operations                      147,851    143,707   300,385    276,411
                                     -------    -------   -------    -------

    Cash Flows From Investing
     Activities
    Capital Expenditures            (121,941)  (244,510) (292,970)  (372,611)
    Proceeds from Sale of Assets      64,604      1,150    79,667      1,150
    Exploration Expense              (10,397)    (7,290)  (16,863)   (12,351)
                                     -------     ------   -------    -------
    Net Cash Used in Investing       (67,734)  (250,650) (230,166)  (383,812)
                                     -------   --------  --------   --------

    Cash Flows From Financing
     Activities
    Sale of Common Stock Proceeds          1    313,867       150    316,107
    Net Increase / (Decrease)
     in Debt                         (62,000)  (105,000)  (52,000)   (85,000)
    Capitalized Debt Issuance
     Costs                           (10,409)         -   (10,409)         -
    Stock-Based Compensation Tax
     Benefit                               -     (4,642)        -          -
    Dividends Paid                    (3,110)    (2,943)   (6,213)    (5,873)
                                      ------     ------    ------     ------
    Net Cash  (Used in) /
     Provided by Financing           (75,518)   201,282   (68,472)   225,234
                                     -------    -------   -------    -------

    Net Increase in Cash
     and Cash Equivalents             $4,599    $94,339    $1,747   $117,833
                                      ======    =======    ======   ========




     Selected Item Review and Reconciliation of Net Income and Earnings Per
                                      Share
                    (In thousands, except per share amounts)

                                           Quarter Ended    Six Months Ended
                                              June 30,          June 30,
                                              --------          --------
                                          2009      2008      2009      2008
                                          ----      ----      ----      ----
    As Reported - Net Income            $25,502   $54,625   $73,082  $100,600
    Reversal of Selected Items,
     Net of Tax:
      (Gain) / Loss on Sale of
        Assets (1)                        9,596      (253)    1,629      (253)
      Stock-Based Compensation Expense    3,875    13,668     7,091    24,723
      Unrealized (Gain) / Loss on
       Derivatives (2)                       79     1,833      (511)    1,833
                                             --     -----      ----     -----
    Net Income Excluding Selected
     Items                              $39,052   $69,873   $81,291  $126,903
                                        =======   =======   =======  ========
    As Reported - Net Earnings Per
     Share                                $0.25     $0.55     $0.71     $1.03
    Per Share Impact of Reversing
     Selected Items                        0.13      0.16      0.07      0.26
                                           ----      ----      ----      ----
    Net Earnings Per Share Including
     Reversal of Selected Items           $0.38     $0.71     $0.78     $1.29
                                          =====     =====     =====     =====
    Weighted Average Common Shares
     Outstanding                        103,640    98,467   103,581    98,092

    (1)  The loss on sale of assets in 2009 primarily relates to a loss on
         our April 2009 sale of our Canadian properties, partially offset by
         a gain on sale of assets from the first quarter 2009 sale of the
         Thornwood properties in the East.  The loss on sale of assets for
         the three and six months ended June 30, 2009 considers a tax benefit
         associated with foreign tax credits.
    (2)  This unrealized (gain) / loss is included in Natural Gas Production
         Revenues in the Condensed Consolidated Statement of Operations and
         represents the mark to market change related to the Company's natural
         gas basis swaps.



              Discretionary Cash Flow Calculation and Reconciliation
                                  (In thousands)

                                  Quarter Ended         Six Months Ended
                                     June 30,               June 30,
                                     --------               --------
                                 2009         2008       2009       2008
                                 ----         ----       ----       ----
    Discretionary Cash Flow
    As Reported - Net Income   $25,502       $54,625   $73,082   $100,600
    Plus / (Less):
    Unrealized (Gain) / Loss
     on Derivatives                126         2,909      (815)     2,909
    Income Charges Not
     Requiring Cash             69,151        50,692   140,443    114,498
    (Gain) / Loss on Sale
     of Assets                  16,562          (401)    3,855       (401)
    Deferred Income Tax
     Expense                    11,903        31,955    38,252     55,515
    Exploration Expense         10,397         7,290    16,863     12,351
                                ------         -----    ------     ------
    Discretionary Cash Flow    133,641       147,070   271,680    285,472
    Changes in Assets and
     Liabilities                14,210        (8,005)   28,705     (9,061)
    Stock-Based Compensation
     Tax Benefit                     -         4,642         -          -
                                   ---         -----       ---        ---
    Net Cash Provided by
     Operations               $147,851      $143,707  $300,385   $276,411
                              ========      ========  ========   ========


                               Net Debt Reconciliation
                                   (In thousands)

                                    June 30,    December 31,
                                      2009          2008
                                      ----          ----

     Current Portion of
      Long-Term Debt                $20,000       $35,857
     Long-Term Debt                 795,000       831,143
                                    -------       -------
       Total Debt                  $815,000      $867,000
     Stockholders' Equity         1,836,472     1,790,562
                                  ---------     ---------
       Total Capitalization      $2,651,472    $2,657,562

     Total Debt                    $815,000      $867,000
     Less:  Cash and Cash
      Equivalents                   (29,848)      (28,101)
                                    -------       -------
       Net Debt                    $785,152      $838,899

     Net Debt                      $785,152      $838,899
     Stockholders' Equity         1,836,472     1,790,562
                                  ---------     ---------
       Total Adjusted
        Capitalization           $2,621,624    $2,629,461

     Total Debt to Total
      Capitalization Ratio            30.7%         32.6%
     Less:  Impact of Cash
      and Cash Equivalents             0.8%          0.7%
                                       ----          ----
       Net Debt to Adjusted
        Capitalization Ratio          29.9%         31.9%

SOURCE Cabot Oil & Gas Corporation

CONTACT: Scott Schroeder of
Cabot Oil & Gas Corporation,
+1-281-589-4993