NATIONAL FUEL GAS CO - FORM 8-K - EX-99 - EXHIBIT 99

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8-K - 8-K - NATIONAL FUEL GAS CO	nfg-512020x8k.htm

Exhibit 99




		6363 Main Street/Williamsville, NY 14221

Release Date:	Immediate April 30, 2020	Kenneth E. Webster Investor Relations 716-857-7067	Karen M. Camiolo Treasurer 716-857-7344

NATIONAL FUEL REPORTS SECOND QUARTER EARNINGS

WILLIAMSVILLE, N.Y.: National Fuel Gas Company (“National Fuel” or the “Company”) (NYSE:NFG) today announced consolidated results for the second quarter of its 2020 fiscal year and for the six months ended March 31, 2020.

FISCAL 2020 SECOND QUARTER SUMMARY


•	GAAP net loss of $106.1 million, or $1.23 per share, compared to GAAP net income of $90.6 million, or $1.04 per share, in the prior year, which includes a $129.3 million after-tax impairment of oil and gas properties and a $56.8 million deferred tax valuation allowance described in further detail in this release


•	Adjusted operating results of $84.2 million, or $0.97 per share, compared to $92.9 million, or $1.07 per share, in the prior year (see non-GAAP reconciliation on page 2)


•	Adjusted EBITDA of $231.1 million, an increase of $5.3 million from $225.8 million in the prior year (non-GAAP reconciliation on page 24)


•	E&P segment net production of 59.8 Bcfe, an increase of 11 Bcfe, or 23% from the prior year, including the impact of approximately 2.7 Bcf of curtailments due to sustained low natural gas prices in Appalachia


•	Average natural gas prices, after the impact of hedging, of $2.12 per Mcf, down $0.46 per Mcf from the prior year


•	Average oil prices, after the impact of hedging, of $58.23 per Bbl, down $2.78 per Bbl from the prior year


•	Gathering revenues of $35.3 million, an increase of $5.9 million, or 20%, on higher throughput from the E&P segment


•	Pipeline & Storage revenues of $79.2 million, an increase of $6.9 million, or 10%, from the prior year, largely driven by the successful resolution of a National Fuel Gas Supply Corporation rate proceeding


•	Reducing fiscal 2020 consolidated capital expenditure guidance to a range of $680 to $740 million, a decrease of $30 million from the midpoint of the Company's previous guidance range

MANAGEMENT COMMENTS ON COMPANY’S COVID-19 RESPONSE

David P. Bauer, President and Chief Executive Officer of National Fuel Gas Company, stated: “As we confront the challenges of the COVID-19 pandemic, I am proud to say that National Fuel has continued to safely and reliably provide natural gas service to our over 743,000 utility customers in western New York and northwestern Pennsylvania, operate our extensive network of transportation, compression and gathering infrastructure, and produce essential natural gas supplies.

The continuity of our operations is a direct result of the dedication and hard work of our over 2,000 employees. During this unprecedented situation, National Fuel has remained committed to our workforce - the bedrock of our Company - and has not instituted any furloughs or workforce reductions. With a large portion of our employees now working remotely, we have implemented a number of initiatives to provide the flexibility needed to address this new normal, including additional paid time off to address child care needs, and encouraging the use of alternative work schedules.

With respect to our in-field workforce and customer service representatives, all of whom provide essential services to our communities each and every day, we have adopted appropriate social distancing measures and have provided necessary personal protective equipment in line with directives from federal, state, and local agencies. As this public health crisis evolves, the health and well-being of our employees and our communities will remain our number one priority, and National Fuel will continue to monitor developments affecting our stakeholders in order to take appropriate steps to mitigate the impacts of the COVID-19 virus.”

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RECONCILIATION OF GAAP EARNINGS TO ADJUSTED OPERATING RESULTS




	Three Months Ended						Six Months Ended
	March 31,						March 31,
(in thousands except per share amounts)	2020			2019			2020			2019
Reported GAAP Earnings	$	(106,068	)	$	90,595		$	(19,477	)	$	193,256
Items impacting comparability:
Impairment of oil and gas properties (E&P)	177,761			—			177,761			—
Tax impact of impairment of oil and gas properties	(48,503		)	—			(48,503		)	—
Deferred tax valuation allowance	56,770			—			56,770			—
Remeasurement of deferred income taxes under 2017 Tax Reform	—			—			—			(5,000		)
Mark-to-market adjustments due to hedge ineffectiveness (E&P)	—			6,742			—			237
Tax impact of mark-to-market adjustments due to hedge ineffectiveness	—			(1,416		)	—			(50		)
Unrealized (gain) loss on other investments (Corporate / All Other)	5,414			(3,831		)	6,433			2,516
Tax impact of unrealized (gain) loss on other investments	(1,137		)	805			(1,351		)	(528		)
Adjusted Operating Results	$	84,237		$	92,895		$	171,633		$	190,431

Reported GAAP Earnings Per Share	$	(1.23	)	$	1.04		$	(0.23	)	$	2.23
Items impacting comparability:
Impairment of oil and gas properties, net of tax (E&P)	1.49			—			1.49			—
Deferred tax valuation allowance	0.66			—			0.66			—
Remeasurement of deferred income taxes under 2017 Tax Reform	—			—			—			(0.06		)
Mark-to-market adjustments due to hedge ineffectiveness, net of tax (E&P)	—			0.06			—			—
Unrealized (gain) loss on other investments, net of tax (Corporate / All Other)	0.05			(0.03		)	0.06			0.02
Rounding	—			—			—			0.01
Adjusted Operating Results Per Share	$	0.97		$	1.07		$	1.98		$	2.20

MANAGEMENT COMMENTS ON SECOND QUARTER RESULTS

Mr. Bauer added: “Low commodity prices continued to serve as a headwind during the quarter, weighing on our results and requiring the Company to write down the value of its oil and gas reserves in our Exploration and Production segment. Operationally, however, our results were in line with our expectations, driven by the strong performance of our Pipeline and Storage and Gathering businesses, both of which saw significant earnings growth. In these uncertain times, our diversified business model continues to function as designed, providing National Fuel with stability through a consistent, predictable base of cash flows and a strong balance sheet.”

FISCAL 2020 GUIDANCE AND BUSINESS UPDATE

National Fuel is revising its fiscal 2020 earnings guidance to reflect revised commodity price assumptions for the balance of the fiscal year, and the results of the fiscal second quarter. The Company is now projecting that earnings, excluding items impacting comparability, will be within the range of $2.75 to $2.95 per share, or $2.85 per share at the midpoint of the range.

The Company is assuming that NYMEX natural gas prices will average $2.05 per MMBtu for the remainder of fiscal 2020, unchanged from the previous guidance, while also lowering its Appalachian spot price forecast to $1.65 per MMBtu. Additionally, the Company is now assuming that WTI oil prices will average $22.50 per barrel (Bbl) for the remainder of fiscal 2020, a decrease of $32.50 per Bbl from the $55.00 assumed in the previous guidance. These price assumptions are intended to reflect the current NYMEX forward markets for natural gas and oil and consider the impact of local sales point differentials.

The Exploration and Production segment is lowering its fiscal 2020 net production guidance to a range of 230 to 240 Bcfe, which reflects the impacts of curtailments during the second quarter and estimated curtailments for the month of April. During the second quarter, Seneca executed approximately 12.6 Bcf of new NYMEX swap contracts and fixed price physical firm sales for fiscal 2020. The Company currently has financial hedges and fixed price physical firm sales contracts in place on approximately 72% of Seneca’s remaining expected fiscal 2020 natural gas production that, on average, lock-in a price realization after the cost of transportation of $2.16 per Mcf.

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In addition, the Company is lowering its consolidated capital expenditure guidance to a range of $680 to $740 million, a $30 million decrease from the midpoint of the Company’s prior guidance range. The Company’s other guidance assumptions remain largely unchanged from the previous guidance.

Additional details on the Company's updated forecast assumptions and business segment guidance for fiscal 2020 are outlined in the table on page 8.

DISCUSSION OF SECOND QUARTER RESULTS BY SEGMENT

The following earnings discussion of each operating segment for the quarter ended March 31, 2020 is summarized in a tabular form on pages 9 and 10 of this report (earnings drivers for the six months ended March 31, 2020 are summarized on pages 11 and 12). It may be helpful to refer to those tables while reviewing this discussion. As of the quarter ended September 30, 2019, the Company is no longer reporting the Energy Marketing operations as a reportable segment. The Energy Marketing operations have been included in the All Other category in the disclosures and tables that follow below. Prior year segment information has been restated to reflect this change in presentation.

Note that management defines Adjusted Operating Results as reported GAAP earnings adjusted for items impacting comparability, and Adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability.

Upstream Business

Exploration and Production Segment

The Exploration and Production segment operations are carried out by Seneca Resources Company, LLC ("Seneca"). Seneca explores for, develops and produces natural gas and oil reserves, primarily in Pennsylvania and California.



	Three Months Ended
	March 31,
(in thousands)	2020			2019		Variance
GAAP Earnings	$	(175,275	)	$	21,873	$	(197,148	)
Impairment of oil and gas properties, net of tax	129,258			—		129,258
Deferred tax valuation allowance	60,463			—		60,463
Mark-to-market adjustments due to hedge ineffectiveness, net of tax	—			5,326		(5,326		)
Adjusted Operating Results	$	14,446		$	27,199	$	(12,753	)

Adjusted EBITDA	$	79,846		$	83,580	$	(3,734	)

Seneca’s second quarter GAAP earnings decreased $197.1 million versus the prior year, which includes the impact of a non-cash, pre-tax impairment of Seneca’s oil and natural gas reserves, and the recognition of a valuation allowance that reduced the deferred tax asset related to certain state-level net operating loss and credit carryforwards that may not be realized.

During the second quarter, Seneca recorded a non-cash, pre-tax impairment charge of $177.8 million ($129.3 million after-tax) to write-down the value of Seneca’s oil and natural gas reserves under the full cost method of accounting. The full cost method of accounting requires that Seneca perform a quarterly “ceiling test” to compare the present value of future revenues from its oil and natural gas reserves based on an unweighted arithmetic average of the first day of the month oil and gas prices for each month within the 12-month period prior to the end of the reporting period (“the ceiling”) with the book value of those reserves at the balance sheet date. If the book value of the reserves exceeds the ceiling, a non-cash impairment charge must be recorded in order to reduce the book value of the reserves to the calculated ceiling. It is anticipated that the current low commodity price environment will lead to impairments during the remainder of fiscal 2020 and likely in the first quarter of fiscal 2021 as well.

During the quarter ended March 31, 2020, the Company recorded a full valuation allowance in the amount of $60.5 million against certain state deferred tax assets based on its conclusion, considering all available evidence (both positive and negative),

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that it was more likely than not that these deferred tax assets would not be realized. A significant item of objective negative evidence considered was a projected three-year cumulative pre-tax loss primarily due to the non-cash impairments of Seneca’s oil and gas reserves noted above. Changes in judgment regarding future realization of these deferred tax assets may result in a reversal of all or a portion of the valuation allowance.

Excluding these items noted above, as well as the net impact of non-cash mark-to-market adjustments recorded in the prior year relating to hedge ineffectiveness (see table above), Seneca’s second quarter earnings decreased $12.8 million as the positive impact of higher production was more than offset by the negative impacts of lower realized natural gas and crude oil prices, higher operating expenses, higher interest expense, and a higher effective tax rate.

Seneca produced 59.8 Bcfe during the second quarter, an increase of 11.0 Bcfe, or 23%, from the prior year. Natural gas production increased 10.7 Bcf, or 24%, due primarily to production from new Marcellus and Utica wells completed and connected to sales in Appalachia. Net production increased 5.4 Bcf to 26.6 Bcf in Seneca’s Western Development Area and 5.4 Bcf to 29.0 Bcf in the Eastern Development Area. Seneca curtailed an estimated 2.7 Bcf of net natural gas production during the second quarter due to lower spot pricing at local sales points in Pennsylvania. Oil production for the second quarter increased 42,000 Bbls from the prior year as new production continues to come on-line from Seneca’s development of the Pioneer and 17N assets in the Midway Sunset area of California, as well as the Coalinga assets.

Seneca's average realized natural gas price, after the impact of hedging and transportation costs, was $2.12 per Mcf, a decrease of $0.46 per Mcf from the prior year. This decline was largely due to lower NYMEX prices and lower spot pricing at local sales points in Pennsylvania. Seneca's average realized oil price, after the impact of hedging, was $58.23 per Bbl, a decrease of $2.78 per Bbl compared to the prior year. The decline in oil price realizations was due primarily to lower market prices for crude oil during the quarter and reduced price differentials at local sales points in California.

The increase in Seneca’s operating expenses was largely due to higher production during the quarter. Lease operating and transportation (“LOE”) expense, which increased $5.8 million, includes the fees paid to the Company’s Gathering segment for gathering and compression services used to connect Seneca’s Marcellus and Utica production to sales points along interstate pipelines. In addition to higher production, the $9.2 million increase in depreciation, depletion and amortization (“DD&A”) expense was also due to a higher DD&A rate. Seneca’s general and administrative (“G&A”) costs were relatively flat despite the increased production. On a unit of production basis, G&A expenses during the quarter decreased $0.06 per Mcfe to $0.29 per Mcfe.

The increase in Seneca’s effective tax rate, excluding the impact of the valuation allowance recorded at March 31, 2020 discussed above, was largely driven by the prior year impact of the Enhanced Oil Recovery tax credit, which was not available in the current year.

Midstream Businesses

Pipeline and Storage Segment

The Pipeline and Storage segment’s operations are carried out by National Fuel Gas Supply Corporation (“Supply Corporation”) and Empire Pipeline, Inc. (“Empire”). The Pipeline and Storage segment provides natural gas transportation and storage services to affiliated and non-affiliated companies through an integrated system of pipelines and underground natural gas storage fields in western New York and Pennsylvania.



	Three Months Ended
	March 31,
(in thousands)	2020		2019		Variance
GAAP Earnings	$	22,087	$	17,749	$	4,338

Adjusted EBITDA	$	49,102	$	41,281	$	7,821

The Pipeline and Storage segment’s second quarter GAAP earnings increased $4.3 million versus the prior year primarily driven by higher operating revenues and lower operation and maintenance (“O&M”) expenses, partially offset by higher DD&A expense. The increase in operating revenues of $6.9 million, or 10%, was largely due to an increase in Supply Corporation's transportation and storage rates effective February 1, 2020, in accordance with Supply Corporation's rate case settlement in principle coupled with new demand charges for transportation service from Supply Corporation's Line N to Monaca expansion

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project, which was placed in service on November 1, 2019. O&M expense decreased $0.9 million primarily due to lower compressor and facility maintenance costs, partially offset by an increase in pipeline integrity costs. The increase in DD&A expense of $2.1 million was primarily attributable to an increase in Supply Corporation's depreciation rates associated with its rate case settlement in principle.

Gathering Segment

The Gathering segment’s operations are carried out by National Fuel Gas Midstream Company, LLC’s limited liability companies. The Gathering segment constructs, owns and operates natural gas gathering pipelines and compression facilities in the Appalachian region, which currently deliver Seneca’s gross Appalachian production to the interstate pipeline system.



	Three Months Ended
	March 31,
(in thousands)	2020			2019		Variance
GAAP Earnings	$	19,898		$	12,690	$	7,208
Deferred tax valuation allowance	(3,769		)	—		(3,769		)
Adjusted Operating Results	$	16,129		$	12,690	$	3,439

Adjusted EBITDA	$	29,541		$	24,598	$	4,943

The Gathering segment’s second quarter GAAP earnings increased $7.2 million versus the prior year. Earnings were positively impacted by $3.8 million as a result of the Gathering segment's recognition of an income tax benefit that was recorded as an offset to the valuation allowance described above in the Exploration and Production segment. This offset is a result of the Gathering and Exploration and Production segments’ subsidiaries filing a combined state tax return. Taxable income generated in the Gathering segment is used to offset taxable losses in the Exploration and Production segment, which provided the opportunity to reduce the valuation allowance recorded in the Exploration and Production segment. Excluding this item, the Gathering segment’s earnings increased $3.4 million. The increase was primarily driven by higher operating revenues, which were partially offset by higher O&M expense and a modest increase in DD&A expense. Operating revenues increased $5.9 million, or 20%, primarily due to an 11.0 Bcf increase in gathered volumes from Seneca’s Appalachian natural gas production. The $1.0 million increase in O&M expense was due to an increase in compressor station operating and preventative maintenance activity during the current quarter. The $0.6 million increase in DD&A expense was due primarily to a higher average total value of plant assets in service versus the prior year.

Downstream Businesses

Utility Segment

The Utility segment operations are carried out by National Fuel Gas Distribution Corporation (“Distribution”), which sells or transports natural gas to customers located in western New York and northwestern Pennsylvania.



	Three Months Ended
	March 31,
(in thousands)	2020		2019		Variance
GAAP Earnings	$	31,499	$	35,589	$	(4,090	)

Adjusted EBITDA	$	73,192	$	78,688	$	(5,496	)

The Utility segment’s second quarter GAAP earnings decreased $4.1 million over the prior year primarily driven by a decline in customer margin (operating revenues less purchased gas sold) and higher O&M expense. The $1.5 million decrease in customer margin was due primarily to warmer weather in Distribution's Pennsylvania service territory, partially offset by higher revenues earned through the Company’s system modernization tracking mechanism and the positive impact of adjustments related to regulatory rate and cost recovery mechanisms subject to annual reconciliation. Weather in Distribution's Pennsylvania service territory was 17.5% warmer on average than last year, resulting in a decrease in residential and transportation customer throughput and revenues. The impact of weather variations on earnings in Distribution's New York service territory is largely mitigated by that jurisdiction's weather normalization clause. The $3.3 million increase in O&M expense was primarily attributable to higher personnel costs as well as a higher accrual for bad debt expense given the economic backdrop in the Company's service territory.

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Corporate and All Other

The Company’s operations that are included in Corporate and All Other, which now include the Company’s energy marketing business, generated a combined loss of $4.3 million in the current year second quarter, which was a $7.0 million decrease from the combined earnings of $2.7 million generated in the prior-year second quarter. The decrease in earnings was driven primarily by higher unrealized losses on investment securities in the current quarter compared to unrealized gains on investment securities in the prior year second quarter.

EARNINGS TELECONFERENCE

The Company will host a conference call on Friday, May 1, 2020, at 8:30 a.m. Eastern Time to discuss this announcement. There are two ways to access this call. For those with Internet access, visit the NFG Investor Relations News & Events page at National Fuel’s website at investor.nationalfuelgas.com. For those without Internet access, audio access is also provided by dialing (toll-free) 833-287-0795, using conference ID number “9349819”. For those unable to listen to the live conference call, an audio replay will be available approximately two hours following the teleconference at the same website link and by phone at (toll-free) 800-585-8367 using conference ID number “9349819”. Both the webcast and a telephonic replay will be available until the close of business on Friday, May 8, 2020.

National Fuel is an integrated energy company reporting financial results for four operating segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility. Additional information about National Fuel is available at www.nationalfuelgas.com.





Analyst Contact:	Kenneth E. Webster	716-857-7067
Media Contact:	Karen L. Merkel	716-857-7654

Certain statements contained herein, including statements identified by the use of the words “anticipates,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,” “may” and similar expressions, and statements which are other than statements of historical facts, are “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. The Company’s expectations, beliefs and projections contained herein are expressed in good faith and are believed to have a reasonable basis, but there can be no assurance that such expectations, beliefs or projections will result or be achieved or accomplished. In addition to other factors, the following are important factors that could cause actual results to differ materially from those discussed in the forward-looking statements: impairments under the SEC’s full cost ceiling test for natural gas and oil reserves; changes in the price of natural gas or oil; financial and economic conditions, including the availability of credit, and occurrences affecting the Company’s ability to obtain financing on acceptable terms for working capital, capital expenditures and other investments, including any downgrades in the Company’s credit ratings and changes in interest rates and other capital market conditions; the length and severity of the recent COVID-19 pandemic, including its impacts across our businesses on demand, operations, global supply chains and liquidity; changes in economic conditions, including global, national or regional recessions, and their effect on the demand for, and customers’ ability to pay for, the Company’s products and services; the creditworthiness or performance of the Company’s key suppliers, customers and counterparties; changes in laws, regulations or judicial interpretations to which the Company is subject, including those involving derivatives, taxes, safety, employment, climate change, other environmental matters, real property, and exploration and production activities such as hydraulic fracturing; delays or changes in costs or plans with respect to Company projects or related projects of other companies, including disruptions due to COVID-19, as well as difficulties or delays in obtaining necessary governmental approvals, permits or orders or in obtaining the cooperation of interconnecting facility operators; governmental/regulatory actions, initiatives and proceedings, including those involving rate cases (which address, among other things, target rates of return, rate design and retained natural gas), environmental/safety requirements, affiliate relationships, industry structure, and franchise renewal; changes in price differentials between similar quantities of natural gas or oil sold at different geographic locations, and the effect of such changes on commodity production, revenues and demand for pipeline transportation capacity to or from such locations; the impact of information technology disruptions, cybersecurity or data security breaches; factors affecting the Company’s ability to successfully identify, drill for and produce economically viable natural gas and oil reserves, including among others geology, lease availability, title disputes, weather conditions, shortages, delays or unavailability of equipment and services required in drilling operations, insufficient gathering, processing and transportation capacity, the need to obtain governmental approvals and permits, and compliance with environmental laws and

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regulations; increasing health care costs and the resulting effect on health insurance premiums and on the obligation to provide other post-retirement benefits; other changes in price differentials between similar quantities of natural gas or oil having different quality, heating value, hydrocarbon mix or delivery date; the cost and effects of legal and administrative claims against the Company or activist shareholder campaigns to effect changes at the Company; uncertainty of oil and gas reserve estimates; significant differences between the Company’s projected and actual production levels for natural gas or oil; changes in demographic patterns and weather conditions; changes in the availability, price or accounting treatment of derivative financial instruments; changes in laws, actuarial assumptions, the interest rate environment and the return on plan/trust assets related to the Company’s pension and other post-retirement benefits, which can affect future funding obligations and costs and plan liabilities; economic disruptions or uninsured losses resulting from major accidents, fires, severe weather, natural disasters, terrorist activities or acts of war; significant differences between the Company’s projected and actual capital expenditures and operating expenses; or increasing costs of insurance, changes in coverage and the ability to obtain insurance. The Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date thereof.

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NATIONAL FUEL GAS COMPANY

AND SUBSIDIARIES

GUIDANCE SUMMARY

As discussed on page 2, the Company is revising its earnings guidance for fiscal 2020. Additional details on the Company's forecast assumptions and business segment guidance are outlined in the table below.

While the Company expects to incur additional ceiling test impairment charges in the remaining quarters of fiscal 2020 and likely in the first quarter of fiscal 2021 as well, the amount of these charges is not reasonably determinable at this time. The amount of any ceiling test charge is determined at the end of the applicable quarter and will depend on many factors, including additions to or subtractions from proved reserves, fluctuations in oil and gas prices, and income tax effects related to the differences between the book and tax basis of the Company’s oil and gas properties. Some or all of these factors are likely to be significant. Because the expected ceiling test impairment charges and other potential items impacting comparability are not reasonably determinable at this time, the Company is unable to provide earnings guidance other than on a non-GAAP basis that excludes these items.



	Updated FY 2020 Guidance	Previous FY 2020 Guidance
Consolidated Earnings per Share, excluding items impacting comparability	$2.75 to $2.95	$2.95 to $3.15
Consolidated Effective Tax Rate	~ 26%	~ 25%

Capital Expenditures (Millions)
Exploration and Production	$375 - $395	$375 - $410
Pipeline and Storage	$175 - $195	$180 - $215
Gathering	$50 - $60	$50 - $60
Utility	$80 - $90	$90 - $100
Consolidated Capital Expenditures	$680 - $740	$695 - $785

Exploration & Production Segment Guidance

Commodity Price Assumptions
NYMEX natural gas price	$2.05 /MMBtu	$2.05 /MMBtu
Appalachian basin spot price	$1.65 /MMBtu	$1.70 /MMBtu
NYMEX (WTI) crude oil price	$22.50 /Bbl	$55.00 /Bbl
California oil price premium (% of WTI)	90%	104%

Production (Bcfe)
East Division - Appalachia	214 to 224	219 to 229
West Division - California	~ 16	~ 16
Total Production	230 to 240	235 to 245

E&P Operating Costs ($/Mcfe)
LOE	$0.85 - $0.89	$0.85 - $0.89
G&A	$0.27 - $0.30	$0.27 - $0.30
DD&A	$0.70 - $0.74	$0.73 - $0.77

Other Business Segment Guidance (Millions)
Gathering Segment Revenues	$135 - $140	$135 - $145
Pipeline and Storage Segment Revenues	~ $305	$290 - $295

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NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
QUARTER ENDED MARCH 31, 2020
(Unaudited)

	Upstream			Midstream						Downstream

	Exploration &			Pipeline &									Corporate /
(Thousands of Dollars)	Production			Storage			Gathering			Utility			All Other			Consolidated*

Second quarter 2019 GAAP earnings	$	21,873		$	17,749		$	12,690		$	35,589		$	2,694		$	90,595

Items impacting comparability:
Mark-to-market adjustments due to hedge ineffectiveness	6,742															6,742
Tax impact of mark-to-market adjustments due to hedge ineffectiveness	(1,416		)													(1,416		)
Unrealized (gain) loss on other investments													(3,831		)	(3,831		)
Tax impact of unrealized (gain) loss on other investments													805			805
Second quarter 2019 adjusted operating results	27,199			17,749			12,690			35,589			(332		)	92,895

Drivers of adjusted operating results**

Upstream Revenues
Higher (lower) natural gas production	21,887															21,887
Higher (lower) crude oil production	2,030															2,030
Higher (lower) realized natural gas prices, after hedging	(20,168		)													(20,168		)
Higher (lower) realized crude oil prices, after hedging	(1,332		)													(1,332		)

Midstream Revenues
Higher (lower) operating revenues				5,456			4,660									10,116

Downstream Margins***
Impact of usage and weather										(3,814		)				(3,814		)
System modernization tracker revenues										1,689						1,689
Regulatory revenue adjustments										615						615
Higher (lower) energy marketing margins													604			604

Operating Expenses
Lower (higher) lease operating and transportation expenses	(4,573		)													(4,573		)
Lower (higher) operating expenses	(395		)	705			(751		)	(2,880		)	415			(2,906		)
Lower (higher) depreciation / depletion	(7,306		)	(1,630		)	(479		)							(9,415		)

Other Income (Expense)
(Higher) lower other deductions	(365		)	(483		)										(848		)
(Higher) lower interest expense	(486		)										(608		)	(1,094		)

Income Taxes
Lower (higher) income tax expense / effective tax rate	(1,646		)	(2		)	2			343			24			(1,279		)

All other / rounding	(399		)	292			7			(43		)	(27		)	(170		)
Second quarter 2020 adjusted operating results	14,446			22,087			16,129			31,499			76			84,237

Items impacting comparability:
Impairment of oil and gas properties	(177,761		)													(177,761		)
Tax impact of impairment of oil and gas properties	48,503															48,503
Deferred tax valuation allowance	(60,463		)				3,769						(76		)	(56,770		)
Unrealized gain (loss) on other investments													(5,414		)	(5,414		)
Tax impact of unrealized gain (loss) on other investments													1,137			1,137
Second quarter 2020 GAAP earnings	$	(175,275	)	$	22,087		$	19,898		$	31,499		$	(4,277	)	$	(106,068	)

* Amounts do not reflect intercompany eliminations
** Operating results have been calculated using the 21% federal statutory rate effective for the 2019 fiscal year.
*** Downstream margin defined as operating revenues less purchased gas expense.

Page 10.



NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
QUARTER ENDED MARCH 31, 2020
(Unaudited)

	Upstream			Midstream						Downstream

	Exploration &			Pipeline &									Corporate /
	Production			Storage			Gathering			Utility			All Other			Consolidated*

Second quarter 2019 GAAP earnings per share	$	0.25		$	0.20		$	0.15		$	0.41		$	0.03		$	1.04
Items impacting comparability:
Mark-to-market adjustments due to hedge ineffectiveness, net of tax	0.06															0.06
Unrealized (gain) loss on other investments, net of tax													(0.03		)	(0.03		)
Second quarter 2019 adjusted operating results per share	0.31			0.20			0.15			0.41			—			1.07

Drivers of adjusted operating results**

Upstream Revenues
Higher (lower) natural gas production	0.25															0.25
Higher (lower) crude oil production	0.02															0.02
Higher (lower) realized natural gas prices, after hedging	(0.23		)													(0.23		)
Higher (lower) realized crude oil prices, after hedging	(0.02		)													(0.02		)

Midstream Revenues
Higher (lower) operating revenues				0.06			0.05									0.11

Downstream Margins***
Impact of usage and weather										(0.04		)				(0.04		)
System modernization tracker revenues										0.02						0.02
Regulatory revenue adjustments										0.01						0.01
Higher (lower) energy marketing margins													0.01			0.01

Operating Expenses
Lower (higher) lease operating and transportation expenses	(0.05		)													(0.05		)
Lower (higher) operating expenses	—			0.01			(0.01		)	(0.03		)	—			(0.03		)
Lower (higher) depreciation / depletion	(0.08		)	(0.02		)	(0.01		)							(0.11		)

Other Income (Expense)
(Higher) lower other deductions	—			(0.01		)										(0.01		)
(Higher) lower interest expense	(0.01		)										(0.01		)	(0.02		)

Income Taxes
Lower (higher) income tax expense / effective tax rate	(0.02		)	—			—			—			—			(0.02		)

All other / rounding	—			0.01			0.01			(0.01		)	—			0.01
Second quarter 2020 adjusted operating results per share	0.17			0.25			0.19			0.36			—			0.97

Items impacting comparability:
Impairment of oil and gas properties, net of tax	(1.49		)													(1.49		)
Deferred tax valuation allowance	(0.70		)				0.04						—			(0.66		)
Unrealized gain (loss) on other investments, net of tax													(0.05		)	(0.05		)
Earnings per share impact of diluted shares	(0.01		)	0.01												—
Second quarter 2020 GAAP earnings per share	$	(2.03	)	$	0.26		$	0.23		$	0.36		$	(0.05	)	$	(1.23	)

* Amounts do not reflect intercompany eliminations
** Operating results have been calculated using the 21% federal statutory rate effective for the 2019 fiscal year.
*** Downstream margin defined as operating revenues less purchased gas expense.

Page 11.



NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
SIX MONTHS ENDED MARCH 31, 2020
(Unaudited)

	Upstream			Midstream						Downstream

	Exploration &			Pipeline &									Corporate /
(Thousands of Dollars)	Production			Storage			Gathering			Utility			All Other			Consolidated*

Six months ended March 31, 2019 GAAP earnings	$	60,087		$	42,851		$	26,872		$	61,237		$	2,209		$	193,256

Items impacting comparability:
Remeasurement of deferred taxes under 2017 Tax Reform	(990		)				(500		)				(3,510		)	(5,000		)
Mark-to-market adjustments due to hedge ineffectiveness	237															237
Tax impact of mark-to-market adjustments due to hedge ineffectiveness	(50		)													(50		)
Unrealized (gain) loss on other investments													2,516			2,516
Tax impact of unrealized (gain) loss on other investments													(528		)	(528		)
Six months ended March 31, 2019 adjusted operating results	59,284			42,851			26,372			61,237			687			190,431

Drivers of adjusted operating results**

Upstream Revenues
Higher (lower) natural gas production	40,427															40,427
Higher (lower) crude oil production	3,487															3,487
Higher (lower) realized natural gas prices, after hedging	(32,792		)													(32,792		)
Higher (lower) realized crude oil prices, after hedging	(754		)													(754		)

Midstream Revenues
Higher (lower) operating revenues				1,625			8,688									10,313

Downstream Margins***
Impact of usage and weather										(3,678		)				(3,678		)
System modernization tracker revenues										2,033						2,033
Regulatory revenue adjustments										1,550						1,550
Higher (lower) energy marketing margins													891			891

Operating Expenses
Lower (higher) lease operating and transportation expenses	(11,082		)													(11,082		)
Lower (higher) operating expenses	(1,016		)	1,260			(2,038		)	(2,707		)	674			(3,827		)
Lower (higher) property, franchise and other taxes	1,187			(1,215		)										(28		)
Lower (higher) depreciation / depletion	(14,770		)	(2,017		)	(843		)							(17,630		)

Other Income (Expense)
(Higher) lower other deductions	(713		)	(916		)							1,004			(625		)
(Higher) lower interest expense	(1,192		)	412			272						(717		)	(1,225		)

Income Taxes
Lower (higher) income tax expense / effective tax rate	(2,980		)	(2,458		)	(213		)	(443		)	(266		)	(6,360		)

All other / rounding	(664		)	650			(165		)	90			591			502
Six months ended March 31, 2020 adjusted operating results	38,422			40,192			32,073			58,082			2,864			171,633

Items impacting comparability:
Impairment of oil and gas properties	(177,761		)													(177,761		)
Tax impact of impairment of oil and gas properties	48,503															48,503
Deferred tax valuation allowance	(60,463		)				3,769						(76		)	(56,770		)
Unrealized gain (loss) on other investments													(6,433		)	(6,433		)
Tax impact of unrealized gain (loss) on other investments													1,351			1,351
Six months ended March 31, 2020 GAAP earnings	$	(151,299	)	$	40,192		$	35,842		$	58,082		$	(2,294	)	$	(19,477	)

* Amounts do not reflect intercompany eliminations
** Operating results have been calculated using the 21% federal statutory rate effective for the 2019 fiscal year.
*** Downstream margin defined as operating revenues less purchased gas expense.

Page 12.



NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
SIX MONTHS ENDED MARCH 31, 2020
(Unaudited)

	Upstream			Midstream						Downstream

	Exploration &			Pipeline &									Corporate /
	Production			Storage			Gathering			Utility			All Other			Consolidated*
Six months ended March 31, 2019 GAAP earnings per share	$	0.69		$	0.49		$	0.31		$	0.71		$	0.03		$	2.23
Items impacting comparability:
Remeasurement of deferred taxes under 2017 Tax Reform	(0.01		)				(0.01		)				(0.04		)	(0.06		)
Mark-to-market adjustments due to hedge ineffectiveness, net of tax	—															—
Unrealized (gain) loss on other investments, net of tax													0.02			0.02
Rounding													0.01			0.01
Six months ended March 31, 2019 adjusted operating results per share	0.68			0.49			0.30			0.71			0.02			2.20

Drivers of adjusted operating results**

Upstream Revenues
Higher (lower) natural gas production	0.47															0.47
Higher (lower) crude oil production	0.04															0.04
Higher (lower) realized natural gas prices, after hedging	(0.38		)													(0.38		)
Higher (lower) realized crude oil prices, after hedging	(0.01		)													(0.01		)

Midstream Revenues
Higher (lower) operating revenues				0.02			0.10									0.12

Downstream Margins***
Impact of usage and weather										(0.04		)				(0.04		)
System modernization tracker revenues										0.02						0.02
Regulatory revenue adjustments										0.02						0.02
Higher (lower) energy marketing margins													0.01			0.01

Operating Expenses
Lower (higher) lease operating and transportation expenses	(0.13		)													(0.13		)
Lower (higher) operating expenses	(0.01		)	0.01			(0.02		)	(0.03		)	0.01			(0.04		)
Lower (higher) property, franchise and other taxes	0.01			(0.01		)										—
Lower (higher) depreciation / depletion	(0.17		)	(0.02		)	(0.01		)							(0.20		)

Other Income (Expense)
(Higher) lower other deductions	(0.01		)	(0.01		)							0.01			(0.01		)
(Higher) lower interest expense	(0.01		)	—			—						(0.01		)	(0.02		)

Income Taxes
Lower (higher) income tax expense / effective tax rate	(0.03		)	(0.03		)	—			(0.01		)	—			(0.07		)

All other / rounding	(0.01		)	0.01			—			—			—			—
Six months ended March 31, 2020 adjusted operating results per share	0.44			0.46			0.37			0.67			0.04			1.98

Items impacting comparability:
Impairment of oil and gas properties, net of tax	(1.49		)													(1.49		)
Deferred tax valuation allowance	(0.70		)				0.04						—			(0.66		)
Unrealized gain (loss) on other investments, net of tax													(0.06		)	(0.06		)
Earnings per share impact of diluted shares							0.01						(0.01		)	—
Six months ended March 31, 2020 GAAP earnings per share	$	(1.75	)	$	0.46		$	0.42		$	0.67		$	(0.03	)	$	(0.23	)

* Amounts do not reflect intercompany eliminations
** Operating results have been calculated using the 21% federal statutory rate effective for the 2019 fiscal year.
*** Downstream margin defined as operating revenues less purchased gas expense.

Page 13.





NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

(Thousands of Dollars, except per share amounts)
	Three Months Ended						Six Months Ended
	March 31,						March 31,
	(Unaudited)						(Unaudited)
SUMMARY OF OPERATIONS	2020			2019			2020			2019
Operating Revenues:
Utility and Energy Marketing Revenues	$	282,634		$	357,654		$	510,660		$	629,747
Exploration and Production and Other Revenues	156,542			146,467			323,735			310,403
Pipeline and Storage and Gathering Revenues	51,919			48,423			100,888			102,641
	491,095			552,544			935,283			1,042,791
Operating Expenses:
Purchased Gas	118,270			195,037			210,542			333,697
Operation and Maintenance:
Utility and Energy Marketing	51,725			48,559			94,981			92,475
Exploration and Production and Other	39,959			40,141			76,652			72,936
Pipeline and Storage and Gathering	27,305			27,249			53,190			52,182
Property, Franchise and Other Taxes	22,743			22,535			45,887			46,540
Depreciation, Depletion and Amortization	77,912			65,664			152,830			129,918
Impairment of Oil and Gas Producing Properties	177,761			—			177,761			—
	515,675			399,185			811,843			727,748

Operating Income (Loss)	(24,580		)	153,359			123,440			315,043

Other Income (Expense):
Other Income (Deductions)	(17,480		)	(5,919		)	(20,520		)	(15,521		)
Interest Expense on Long-Term Debt	(25,270		)	(25,273		)	(50,713		)	(50,713		)
Other Interest Expense	(1,892		)	(1,787		)	(3,443		)	(2,860		)

Income (Loss) Before Income Taxes	(69,222		)	120,380			48,764			245,949

Income Tax Expense	36,846			29,785			68,241			52,693

Net Income (Loss) Available for Common Stock	$	(106,068	)	$	90,595		$	(19,477	)	$	193,256

Earnings (Loss) Per Common Share
Basic	$	(1.23	)	$	1.05		$	(0.23	)	$	2.24
Diluted	$	(1.23	)	$	1.04		$	(0.23	)	$	2.23

Weighted Average Common Shares:
Used in Basic Calculation	86,561,066			86,290,047			86,469,258			86,159,932
Used in Diluted Calculation	86,561,066			86,767,673			86,469,258			86,738,809

Page 14.



NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)

	March 31,			September 30,
(Thousands of Dollars)	2020			2019

ASSETS
Property, Plant and Equipment		$11,559,528			$11,204,838
Less - Accumulated Depreciation, Depletion and Amortization	6,003,658			5,695,328
Net Property, Plant and Equipment	5,555,870			5,509,510

Current Assets:
Cash and Temporary Cash Investments	111,655			20,428
Hedging Collateral Deposits	10,728			6,832
Receivables - Net	172,011			139,956
Unbilled Revenue	44,715			18,758
Gas Stored Underground	8,860			36,632
Materials and Supplies - at average cost	48,113			40,717
Unrecovered Purchased Gas Costs	—			2,246
Other Current Assets	100,188			97,054
Total Current Assets	496,270			362,623

Other Assets:
Recoverable Future Taxes	115,934			115,197
Unamortized Debt Expense	13,151			14,005
Other Regulatory Assets	161,800			167,320
Deferred Charges	56,855			33,843
Other Investments	137,044			144,917
Goodwill	5,476			5,476
Prepaid Post-Retirement Benefit Costs	71,381			60,517
Fair Value of Derivative Financial Instruments	94,797			48,669
Other	81			80
Total Other Assets	656,519			590,024
Total Assets		$6,708,659			$6,462,157

CAPITALIZATION AND LIABILITIES
Capitalization:
Comprehensive Shareholders' Equity
Common Stock, $1 Par Value Authorized - 200,000,000 Shares; Issued and
Outstanding - 86,561,532 Shares and 86,315,287 Shares, Respectively		$86,562			$86,315
Paid in Capital	835,444			832,264
Earnings Reinvested in the Business	1,176,870			1,272,601
Accumulated Other Comprehensive Loss	(18,917		)	(52,155		)
Total Comprehensive Shareholders' Equity	2,079,959			2,139,025
Long-Term Debt, Net of Current Portion and Unamortized Discount and Debt Issuance Costs	2,134,964			2,133,718
Total Capitalization	4,214,923			4,272,743

Current and Accrued Liabilities:
Notes Payable to Banks and Commercial Paper	230,000			55,200
Current Portion of Long-Term Debt	—			—
Accounts Payable	106,938			132,208
Amounts Payable to Customers	17,213			4,017
Dividends Payable	37,654			37,547
Interest Payable on Long-Term Debt	18,508			18,508
Customer Advances	615			13,044
Customer Security Deposits	14,999			16,210
Other Accruals and Current Liabilities	150,239			139,600
Fair Value of Derivative Financial Instruments	7,652			5,574
Total Current and Accrued Liabilities	583,818			421,908

Deferred Credits:
Deferred Income Taxes	777,299			653,382
Taxes Refundable to Customers	360,331			366,503
Cost of Removal Regulatory Liability	224,546			221,699
Other Regulatory Liabilities	157,371			142,367
Pension and Other Post-Retirement Liabilities	126,959			133,729
Asset Retirement Obligations	128,779			127,458
Other Deferred Credits	134,633			122,368
Total Deferred Credits	1,909,918			1,767,506
Commitments and Contingencies	—			—
Total Capitalization and Liabilities		$6,708,659			$6,462,157

Page 15.





NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	Six Months Ended
	March 31,
(Thousands of Dollars)	2020			2019

Operating Activities:
Net Income (Loss) Available for Common Stock	$	(19,477	)	$	193,256
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities:
Impairment of Oil and Gas Producing Properties	177,761			—
Depreciation, Depletion and Amortization	152,830			129,918
Deferred Income Taxes	104,883			90,468
Stock-Based Compensation	7,580			10,731
Other	9,800			7,997
Change in:
Receivables and Unbilled Revenue	(58,248		)	(130,377		)
Gas Stored Underground and Materials and Supplies	20,086			29,093
Unrecovered Purchased Gas Costs	2,246			(1,556		)
Other Current Assets	(3,134		)	10,438
Accounts Payable	(5,465		)	10,226
Amounts Payable to Customers	13,196			12,069
Customer Advances	(12,429		)	(13,176		)
Customer Security Deposits	(1,211		)	(7,184		)
Other Accruals and Current Liabilities	9,076			48,028
Other Assets	(10,359		)	(38,686		)
Other Liabilities	3,857			(10,410		)
Net Cash Provided by Operating Activities	$	390,992		$	340,835

Investing Activities:
Capital Expenditures	$	(395,486	)	$	(386,579	)
Other	4,167			(2,616		)
Net Cash Used in Investing Activities	$	(391,319	)	$	(389,195	)

Financing Activities:
Changes in Notes Payable to Banks and Commercial Paper	$	174,800		$	—
Dividends Paid on Common Stock	(75,197		)	(73,197		)
Net Repurchases of Common Stock	(4,153		)	(8,864		)
Net Cash Provided by (Used in) Financing Activities	$	95,450		$	(82,061	)

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash	95,123			(130,421		)
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period	27,260			233,047
Cash, Cash Equivalents, and Restricted Cash at March 31	$	122,383		$	102,626

Page 16.





NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)

UPSTREAM BUSINESS


	Three Months Ended									Six Months Ended
(Thousands of Dollars, except per share amounts)	March 31,									March 31,
EXPLORATION AND PRODUCTION SEGMENT	2020			2019			Variance			2020			2019			Variance
Total Operating Revenues	$	155,560		$	146,102		$	9,458		$	321,499		$	308,978		$	12,521

Operating Expenses:
Operation and Maintenance:
General and Administrative Expense	17,429			17,113			316			32,809			32,312			497
Lease Operating and Transportation Expense	51,730			45,941			5,789			102,531			88,503			14,028
All Other Operation and Maintenance Expense	3,084			2,900			184			6,041			5,252			789
Property, Franchise and Other Taxes	3,471			3,310			161			8,171			9,673			(1,502		)
Depreciation, Depletion and Amortization	45,136			35,888			9,248			89,284			70,588			18,696
Impairment of Oil and Gas Producing Properties	177,761			—			177,761			177,761			—			177,761
	298,611			105,152			193,459			416,597			206,328			210,269

Operating Income (Loss)	(143,051		)	40,950			(184,001		)	(95,098		)	102,650			(197,748		)

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(395		)	(4		)	(391		)	(790		)	(8		)	(782		)
Interest and Other Income	208			279			(71		)	441			562			(121		)
Interest Expense	(14,163		)	(13,548		)	(615		)	(28,220		)	(26,711		)	(1,509		)

Income (Loss) Before Income Taxes	(157,401		)	27,677			(185,078		)	(123,667		)	76,493			(200,160		)
Income Tax Expense	17,874			5,804			12,070			27,632			16,406			11,226
Net Income (Loss)	$	(175,275	)	$	21,873		$	(197,148	)	$	(151,299	)	$	60,087		$	(211,386	)

Net Income (Loss) Per Share (Diluted)	$	(2.03	)	$	0.25		$	(2.28	)	$	(1.75	)	$	0.69		$	(2.44	)

Page 17.




NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)

MIDSTREAM BUSINESSES


	Three Months Ended									Six Months Ended
(Thousands of Dollars, except per share amounts)	March 31,									March 31,
PIPELINE AND STORAGE SEGMENT	2020			2019			Variance			2020			2019			Variance
Revenues from External Customers	$	51,919		$	48,421		$	3,498		$	100,888		$	102,639		$	(1,751	)
Intersegment Revenues	27,326			23,918			3,408			50,577			46,769			3,808
Total Operating Revenues	79,245			72,339			6,906			151,465			149,408			2,057

Operating Expenses:
Purchased Gas	(3		)	510			(513		)	(10		)	813			(823		)
Operation and Maintenance	22,014			22,907			(893		)	42,945			44,540			(1,595		)
Property, Franchise and Other Taxes	8,132			7,641			491			16,487			14,949			1,538
Depreciation, Depletion and Amortization	13,356			11,293			2,063			24,960			22,407			2,553
	43,499			42,351			1,148			84,382			82,709			1,673

Operating Income	35,746			29,988			5,758			67,083			66,699			384

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit (Costs) Credit	(174		)	930			(1,104		)	(349		)	1,397			(1,746		)
Interest and Other Income	1,535			1,043			492			3,088			2,502			586
Interest Expense	(7,152		)	(7,500		)	348			(14,264		)	(14,786		)	522

Income Before Income Taxes	29,955			24,461			5,494			55,558			55,812			(254		)
Income Tax Expense	7,868			6,712			1,156			15,366			12,961			2,405
Net Income	$	22,087		$	17,749		$	4,338		$	40,192		$	42,851		$	(2,659	)

Net Income Per Share (Diluted)	$	0.26		$	0.20		$	0.06		$	0.46		$	0.49		$	(0.03	)


	Three Months Ended									Six Months Ended
	March 31,									March 31,
GATHERING SEGMENT	2020			2019			Variance			2020			2019			Variance
Revenues from External Customers	$	—		$	2		$	(2	)	$	—		$	2		$	(2	)
Intersegment Revenues	35,267			29,366			5,901			70,055			59,056			10,999
Total Operating Revenues	35,267			29,368			5,899			70,055			59,058			10,997

Operating Expenses:
Operation and Maintenance	5,702			4,752			950			11,044			8,464			2,580
Property, Franchise and Other Taxes	24			18			6			38			48			(10		)
Depreciation, Depletion and Amortization	5,279			4,673			606			10,418			9,351			1,067
	11,005			9,443			1,562			21,500			17,863			3,637

Operating Income	24,262			19,925			4,337			48,555			41,195			7,360

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(71		)	(1		)	(70		)	(143		)	(83		)	(60		)
Interest and Other Income	89			190			(101		)	157			315			(158		)
Interest Expense	(2,160		)	(2,345		)	185			(4,379		)	(4,723		)	344

Income Before Income Taxes	22,120			17,769			4,351			44,190			36,704			7,486
Income Tax Expense	2,222			5,079			(2,857		)	8,348			9,832			(1,484		)
Net Income	$	19,898		$	12,690		$	7,208		$	35,842		$	26,872		$	8,970

Net Income Per Share (Diluted)	$	0.23		$	0.15		$	0.08		$	0.42		$	0.31		$	0.11

Page 18.





NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)

DOWNSTREAM BUSINESS


	Three Months Ended									Six Months Ended
(Thousands of Dollars, except per share amounts)	March 31,									March 31,
UTILITY SEGMENT	2020			2019			Variance			2020			2019			Variance
Revenues from External Customers	$	250,556		$	298,636		$	(48,080	)	$	445,465		$	518,647		$	(73,182	)
Intersegment Revenues	3,937			4,394			(457		)	5,853			7,040			(1,187		)
Total Operating Revenues	254,493			303,030			(48,537		)	451,318			525,687			(74,369		)

Operating Expenses:
Purchased Gas	119,411			165,235			(45,824		)	204,116			277,115			(72,999		)
Operation and Maintenance	51,070			47,795			3,275			93,913			90,950			2,963
Property, Franchise and Other Taxes	10,820			11,312			(492		)	20,634			21,365			(731		)
Depreciation, Depletion and Amortization	13,751			13,365			386			27,382			26,656			726
	195,052			237,707			(42,655		)	346,045			416,086			(70,041		)

Operating Income	59,441			65,323			(5,882		)	105,273			109,601			(4,328		)

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(12,388		)	(12,686		)	298			(19,151		)	(19,614		)	463
Interest and Other Income	294			1,068			(774		)	1,245			1,780			(535		)
Interest Expense	(5,516		)	(6,263		)	747			(11,190		)	(12,157		)	967

Income Before Income Taxes	41,831			47,442			(5,611		)	76,177			79,610			(3,433		)
Income Tax Expense	10,332			11,853			(1,521		)	18,095			18,373			(278		)
Net Income	$	31,499		$	35,589		$	(4,090	)	$	58,082		$	61,237		$	(3,155	)

Net Income Per Share (Diluted)	$	0.36		$	0.41		$	(0.05	)	$	0.67		$	0.71		$	(0.04	)

Page 19.



NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)

	Three Months Ended									Six Months Ended
(Thousands of Dollars, except per share amounts)	March 31,									March 31
ALL OTHER	2020			2019			Variance			2020			2019			Variance
Revenues from External Customers	$	32,925		$	59,328		$	(26,403	)	$	67,161		$	112,416		$	(45,255	)
Intersegment Revenues	79			43			36			256			375			(119		)
Total Operating Revenues	33,004			59,371			(26,367		)	67,417			112,791			(45,374		)
Operating Expenses:
Purchased Gas	29,151			56,820			(27,669		)	61,184			108,337			(47,153		)
Operation and Maintenance	1,875			1,944			(69		)	3,578			3,822			(244		)
Property, Franchise and Other Taxes	176			134			42			320			270			50
Depreciation, Depletion and Amortization	206			254			(48		)	408			536			(128		)
	31,408			59,152			(27,744		)	65,490			112,965			(47,475		)

Operating Income (Loss)	1,596			219			1,377			1,927			(174		)	2,101

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(69		)	(11		)	(58		)	(138		)	(133		)	(5		)
Interest and Other Income	193			360			(167		)	471			666			(195		)
Interest Expense	(24		)	(8		)	(16		)	(42		)	(13		)	(29		)

Income Before Income Taxes	1,696			560			1,136			2,218			346			1,872
Income Tax Expense (Benefit)	527			144			383			678			(153		)	831
Net Income	$	1,169		$	416		$	753		$	1,540		$	499		$	1,041
Net Income Per Share (Diluted)	$	0.01		$	0.01		$	—		$	0.02		$	0.01		$	0.01

	Three Months Ended									Six Months Ended
	March 31,									March 31,
CORPORATE	2020			2019			Variance			2020			2019			Variance
Revenues from External Customers	$	135		$	55		$	80		$	270		$	109		$	161
Intersegment Revenues	1,094			1,165			(71		)	2,187			2,329			(142		)
Total Operating Revenues	1,229			1,220			9			2,457			2,438			19
Operating Expenses:
Operation and Maintenance	3,499			3,955			(456		)	6,142			6,751			(609		)
Property, Franchise and Other Taxes	120			120			—			237			235			2
Depreciation, Depletion and Amortization	184			191			(7		)	378			380			(2		)
	3,803			4,266			(463		)	6,757			7,366			(609		)

Operating Loss	(2,574		)	(3,046		)	472			(4,300		)	(4,928		)	628

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs	(775		)	(647		)	(128		)	(1,550		)	(1,385		)	(165		)
Interest and Other Income	22,801			32,761			(9,960		)	53,874			56,377			(2,503		)
Interest Expense on Long-Term Debt	(25,270		)	(25,273		)	3			(50,713		)	(50,713		)	—
Other Interest Expense	(1,605		)	(1,324		)	(281		)	(3,023		)	(2,367		)	(656		)

Income (Loss) before Income Taxes	(7,423		)	2,471			(9,894		)	(5,712		)	(3,016		)	(2,696		)
Income Tax Expense (Benefit)	(1,977		)	193			(2,170		)	(1,878		)	(4,726		)	2,848
Net Income (Loss)	$	(5,446	)	$	2,278		$	(7,724	)	$	(3,834	)	$	1,710		$	(5,544	)
Net Income (Loss) Per Share (Diluted)	$	(0.06	)	$	0.02		$	(0.08	)	$	(0.05	)	$	0.02		$	(0.07	)


	Three Months Ended									Six Months Ended
	March 31,									March 31,
INTERSEGMENT ELIMINATIONS	2020			2019			Variance			2020			2019			Variance
Intersegment Revenues	$	(67,703	)	$	(58,886	)	$	(8,817	)	$	(128,928	)	$	(115,569	)	$	(13,359	)
Operating Expenses:
Purchased Gas	(30,289		)	(27,528		)	(2,761		)	(54,748		)	(52,568		)	(2,180		)
Operation and Maintenance	(37,414		)	(31,358		)	(6,056		)	(74,180		)	(63,001		)	(11,179		)
	(67,703		)	(58,886		)	(8,817		)	(128,928		)	(115,569		)	(13,359		)

Operating Income	—			—			—			—			—			—

Other Income (Expense):
Interest and Other Deductions	(28,728		)	(29,201		)	473			(57,675		)	(57,897		)	222
Interest Expense	28,728			29,201			(473		)	57,675			57,897			(222		)
Net Income (Loss)	$	—		$	—		$	—		$	—		$	—		$	—
Net Income (Loss) Per Share (Diluted)	$	—		$	—		$	—		$	—		$	—		$	—

Page 20.





NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT INFORMATION (Continued)
(Thousands of Dollars)


	Three Months Ended									Six Months Ended
	March 31,									March 31,
	(Unaudited)									(Unaudited)
							Increase									Increase
	2020			2019			(Decrease)			2020			2019			(Decrease)

Capital Expenditures:
Exploration and Production	$	102,424	⁽¹⁾	$	142,571	⁽³⁾	$	(40,147	)	$	229,343	⁽¹⁾⁽²⁾	$	262,786	⁽³⁾⁽⁴⁾	$	(33,443	)
Pipeline and Storage	25,554		⁽¹⁾	22,674		⁽³⁾	2,880			82,638		⁽¹⁾⁽²⁾	52,638		⁽³⁾⁽⁴⁾	30,000
Gathering	15,072		⁽¹⁾	12,680		⁽³⁾	2,392			24,910		⁽¹⁾⁽²⁾	21,470		⁽³⁾⁽⁴⁾	3,440
Utility	19,457		⁽¹⁾	19,735		⁽³⁾	(278		)	36,622		⁽¹⁾⁽²⁾	35,657		⁽³⁾⁽⁴⁾	965
Total Reportable Segments	162,507			197,660			(35,153		)	373,513			372,551			962
All Other	1			22			(21		)	22			41			(19		)
Corporate	134			85			49			320			103			217
Total Capital Expenditures	$	162,642		$	197,767		$	(35,125	)	$	373,855		$	372,695		$	1,160

⁽¹⁾

Capital expenditures for the quarter and six months ended March 31, 2020, include accounts payable and accrued liabilities related to capital expenditures of $41.2 million, $9.7 million, $4.4 million, and $4.2 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts have been excluded from the Consolidated Statement of Cash Flows at March 31, 2020, since they represent non-cash investing activities at that date.

⁽²⁾

Capital expenditures for the six months ended March 31, 2020, exclude capital expenditures of $38.0 million, $23.8 million, $6.6 million and $12.7 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2019 and paid during the six months ended March 31, 2020. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2019, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at March 31, 2020.

⁽³⁾

Capital expenditures for the quarter and six months ended March 31, 2019, include accounts payable and accrued liabilities related to capital expenditures of $53.4 million, $10.7 million, $7.4 million, and $3.4 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts have been excluded from the Consolidated Statement of Cash Flows at March 31, 2019, since they represent non-cash investing activities at that date.

⁽⁴⁾

Capital expenditures for the six months ended March 31, 2019, exclude capital expenditures of $51.3 million, $21.9 million, $6.1 million and $9.5 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2018 and paid during the six months ended March 31, 2019. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2018, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at March 31, 2019.




DEGREE DAYS

				Percent Colder
				(Warmer) Than:
Three Months Ended March 31	Normal	2020	2019	Normal ⁽¹⁾		Last Year ⁽¹⁾

Buffalo, NY	3,326	2,738	3,372	(17.7	)	(18.8	)
Erie, PA	3,142	2,555	3,096	(18.7	)	(17.5	)

Six Months Ended March 31

Buffalo, NY	5,579	4,970	5,697	(10.9	)	(12.8	)
Erie, PA	5,186	4,461	5,126	(14.0	)	(13.0	)


⁽¹⁾	Percents compare actual 2020 degree days to normal degree days and actual 2020 degree days to actual 2019 degree days.

Page 21.





NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

EXPLORATION AND PRODUCTION INFORMATION


	Three Months Ended							Six Months Ended
	March 31,							March 31,
					Increase							Increase
	2020		2019		(Decrease)			2020		2019		(Decrease)

Gas Production/Prices:
Production (MMcf)
Appalachia	55,638		44,883		10,755			109,922		90,188		19,734
West Coast	479		487		(8		)	966		989		(23		)
Total Production	56,117		45,370		10,747			110,888		91,177		19,711

Average Prices (Per Mcf)
Appalachia	$	1.77	$	2.65	$	(0.88	)	$	1.97	$	2.79	$	(0.82	)
West Coast	4.34		6.06		(1.72		)	4.67		6.40		(1.73		)
Weighted Average	1.80		2.69		(0.89		)	1.99		2.83		(0.84		)
Weighted Average after Hedging	2.12		2.58		(0.46		)	2.22		2.60		(0.38		)

Oil Production/Prices:
Production (Thousands of Barrels)
Appalachia	1		1		—			2		2		—
West Coast	605		563		42			1,206		1,134		72
Total Production	606		564		42			1,208		1,136		72

Average Prices (Per Barrel)
Appalachia	$	55.90	$	47.54	$	8.36		$	55.48	$	55.93	$	(0.45	)
West Coast	49.91		61.85		(11.94		)	56.25		63.79		(7.54		)
Weighted Average	49.92		61.82		(11.90		)	56.25		63.78		(7.53		)
Weighted Average after Hedging	58.23		61.01		(2.78		)	60.57		61.36		(0.79		)

Total Production (MMcfe)	59,753		48,754		10,999			118,136		97,993		20,143

Selected Operating Performance Statistics:
General & Administrative Expense per Mcfe ⁽¹⁾	$	0.29	$	0.35	$	(0.06	)	$	0.28	$	0.33	$	(0.05	)
Lease Operating and Transportation Expense per Mcfe ⁽¹⁾⁽²⁾	$	0.87	$	0.94	$	(0.07	)	$	0.87	$	0.90	$	(0.03	)
Depreciation, Depletion & Amortization per Mcfe ⁽¹⁾	$	0.76	$	0.74	$	0.02		$	0.76	$	0.72	$	0.04


⁽¹⁾	Refer to page 16 for the General and Administrative Expense, Lease Operating and Transportation Expense and Depreciation, Depletion, and Amortization Expense for the Exploration and Production segment.


⁽²⁾	Amounts include transportation expense of $0.56 and $0.56 per Mcfe for the three months ended March 31, 2020 and March 31, 2019, respectively. Amounts include transportation expense of $0.57 and $0.55 per Mcfe for the six months ended March 31, 2020 and March 31, 2019, respectively.

Page 22.



NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

EXPLORATION AND PRODUCTION INFORMATION

Hedging Summary for Remaining Six Months of Fiscal 2020	Volume			Average Hedge Price
Oil Swaps
Brent	690,000	BBL	$	64.55 / BBL
NYMEX	162,000	BBL	$	50.52 / BBL
Total	852,000	BBL	$	61.88 / BBL

Gas Swaps
NYMEX	45,700,000	MMBTU	$	2.67 / MMBTU
DAWN	3,600,000	MMBTU	$	3.00 / MMBTU
Fixed Price Physical Sales	29,608,125	MMBTU	$	2.18 / MMBTU
Total	78,908,125	MMBTU

Hedging Summary for Fiscal 2021	Volume			Average Hedge Price
Oil Swaps
Brent	696,000	BBL	$	64.29 / BBL
NYMEX	156,000	BBL	$	51.00 / BBL
Total	852,000	BBL	$	61.86 / BBL

Gas Swaps
NYMEX	117,920,000	MMBTU	$	2.61/ MMBTU
DAWN	600,000	MMBTU	$	3.00 / MMBTU
No Cost Collars	25,850,000	MMBTU	$	2.28 / MMBTU (Floor) / $2.77 / MMBTU (Ceiling)
Fixed Price Physical Sales	46,810,846	MMBTU	$	2.22 / MMBTU
Total	191,180,846	MMBTU

Hedging Summary for Fiscal 2022	Volume			Average Hedge Price
Oil Swaps
Brent	300,000	BBL	$	60.07 / BBL
NYMEX	156,000	BBL	$	51.00 / BBL
Total	456,000	BBL	$	56.97 / BBL

Gas Swaps
NYMEX	62,550,000	MMBTU	$	2.52 / MMBTU
No Cost Collars	2,350,000	MMBTU	$	2.28 / MMBTU (Floor) / $2.77 / MMBTU (Ceiling)
Fixed Price Physical Sales	40,588,964	MMBTU	$	2.23 / MMBTU
Total	105,488,964	MMBTU


Hedging Summary for Fiscal 2023	Volume			Average Hedge Price
Gas Swaps
NYMEX	17,500,000	MMBTU	$	2.47 / MMBTU
Fixed Price Physical Sales	36,961,007	MMBTU	$	2.26 / MMBTU
Total	54,461,007	MMBTU

Hedging Summary for Fiscal 2024	Volume			Average Hedge Price
Gas Swaps
NYMEX	1,150,000	MMBTU	$	2.45 / MMBTU
Fixed Price Physical Sales	20,801,194	MMBTU	$	2.25 / MMBTU
Total	21,951,194	MMBTU

Hedging Summary for Fiscal 2025	Volume			Average Hedge Price
Fixed Price Physical Sales	2,293,200	MMBTU	$	2.18 / MMBTU

Page 23.




NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES



Pipeline & Storage Throughput - (millions of cubic feet - MMcf)

	Three Months Ended				Six Months Ended
	March 31,				March 31,
			Increase				Increase
	2020	2019	(Decrease)		2020	2019	(Decrease)
Firm Transportation - Affiliated	42,602	50,967	(8,365	)	77,269	86,668	(9,399	)
Firm Transportation - Non-Affiliated	153,197	148,653	4,544		327,178	304,855	22,323
Interruptible Transportation	531	750	(219	)	1,244	1,665	(421	)
	196,330	200,370	(4,040	)	405,691	393,188	12,503

Gathering Volume - (MMcf)
	Three Months Ended				Six Months Ended
	March 31,				March 31,
			Increase				Increase
	2020	2019	(Decrease)		2020	2019	(Decrease)
Gathered Volume - Affiliated	65,134	54,157	10,977		129,526	108,845	20,681


Utility Throughput - (MMcf)
	Three Months Ended				Six Months Ended
	March 31,				March 31,
			Increase				Increase
	2020	2019	(Decrease)		2020	2019	(Decrease)
Retail Sales:
Residential Sales	26,155	30,906	(4,751	)	45,631	50,686	(5,055	)
Commercial Sales	4,033	4,712	(679	)	6,846	7,558	(712	)
Industrial Sales	183	284	(101	)	400	488	(88	)
	30,371	35,902	(5,531	)	52,877	58,732	(5,855	)
Transportation	25,157	28,928	(3,771	)	45,712	51,198	(5,486	)
	55,528	64,830	(9,302	)	98,589	109,930	(11,341	)

Page 24.

NATIONAL FUEL GAS COMPANY

AND SUBSIDIARIES

NON-GAAP FINANCIAL MEASURES

In addition to financial measures calculated in accordance with generally accepted accounting principles (GAAP), this press release contains information regarding Adjusted Operating Results and Adjusted EBITDA, which are non-GAAP financial measures. The Company believes that these non-GAAP financial measures are useful to investors because they provide an alternative method for assessing the Company's ongoing operating results and for comparing the Company’s financial performance to other companies. The Company's management uses these non-GAAP financial measures for the same purpose, and for planning and forecasting purposes. The presentation of non-GAAP financial measures is not meant to be a substitute for financial measures in accordance with GAAP.

Management defines Adjusted Operating Results as reported GAAP earnings before items impacting comparability. The following table reconciles National Fuel's reported GAAP earnings to Adjusted Operating Results for the three and six months ended March 31, 2020 and 2019:



	Three Months Ended						Six Months Ended
	March 31,						March 31,
(in thousands except per share amounts)	2020			2019			2020			2019
Reported GAAP Earnings	$	(106,068	)	$	90,595		$	(19,477	)	$	193,256
Items impacting comparability
Impairment of oil and gas properties (E&P)	177,761			—			177,761			—
Tax impact of impairment of oil and gas properties	(48,503		)	—			(48,503		)	—
Deferred tax valuation allowance	56,770			—			56,770			—
Remeasurement of deferred income taxes under 2017 Tax Reform	—			—			—			(5,000		)
Mark-to-market adjustments due to hedge ineffectiveness (E&P)	—			6,742			—			237
Tax impact of mark-to-market adjustments due to hedge ineffectiveness	—			(1,416		)	—			(50		)
Unrealized (gain) loss on other investments (Corporate/All Other)	5,414			(3,831		)	6,433			2,516
Tax impact of unrealized (gain) loss on other investments	(1,137		)	805			(1,351		)	(528		)
Adjusted Operating Results	$	84,237		$	92,895		$	171,633		$	190,431

Reported GAAP Earnings per share	$	(1.23	)	$	1.04		$	(0.23	)	$	2.23
Items impacting comparability
Impairment of oil and gas properties, net of tax (E&P)	1.49			—			1.49			—
Deferred tax valuation allowance	0.66			—			0.66			—
Remeasurement of deferred income taxes under 2017 Tax Reform	—			—			—			(0.06		)
Mark-to-market adjustments due to hedge ineffectiveness, net of tax (E&P)	—			0.06			—			—
Unrealized (gain) loss on other investments, net of tax (Corporate/All Other)	0.05			(0.03		)	0.06			0.02
Rounding	—			—			—			0.01
Adjusted Operating Results per share	$	0.97		$	1.07		$	1.98		$	2.20

Management defines Adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability. The following tables reconcile National Fuel's reported GAAP earnings to Adjusted EBITDA for the three and six months ended March 31, 2020 and 2019:



	Three Months Ended						Six Months Ended
	March 31,						March 31,
(in thousands)	2020			2019			2020			2019
Reported GAAP Earnings	$	(106,068	)	$	90,595		$	(19,477	)	$	193,256
Depreciation, Depletion and Amortization	77,912			65,664			152,830			129,918
Other (Income) Deductions	17,480			5,919			20,520			15,521
Interest Expense	27,162			27,060			54,156			53,573
Income Taxes	36,846			29,785			68,241			52,693
Mark-to-Market Adjustments due to Hedge Ineffectiveness	—			6,742			—			237
Impairment of Oil and Gas Producing Properties	177,761			—			177,761			—
Adjusted EBITDA	$	231,093		$	225,765		$	454,031		$	445,198

Adjusted EBITDA by Segment
Pipeline and Storage Adjusted EBITDA	$	49,102		$	41,281		$	92,043		$	89,106
Gathering Adjusted EBITDA	29,541			24,598			58,973			50,546
Total Midstream Businesses Adjusted EBITDA	78,643			65,879			151,016			139,652
Exploration and Production Adjusted EBITDA	79,846			83,580			171,947			173,475
Utility Adjusted EBITDA	73,192			78,688			132,655			136,257
Corporate and All Other Adjusted EBITDA	(588		)	(2,382		)	(1,587		)	(4,186		)
Total Adjusted EBITDA	$	231,093		$	225,765		$	454,031		$	445,198

Page 25.

NATIONAL FUEL GAS COMPANY

AND SUBSIDIARIES

NON-GAAP FINANCIAL MEASURES

SEGMENT ADJUSTED EBITDA



	Three Months Ended						Six Months Ended
	March 31,						March 31,
(in thousands)	2020			2019			2020			2019
Exploration and Production Segment
Reported GAAP Earnings	$	(175,275	)	$	21,873		$	(151,299	)	$	60,087
Depreciation, Depletion and Amortization	45,136			35,888			89,284			70,588
Other (Income) Deductions	187			(275		)	349			(554		)
Interest Expense	14,163			13,548			28,220			26,711
Income Taxes	17,874			5,804			27,632			16,406
Mark-to-Market Adjustments due to Hedge Ineffectiveness	—			6,742			—			237
Impairment of Oil and Gas Producing Properties	177,761			—			177,761			—
Adjusted EBITDA	$	79,846		$	83,580		$	171,947		$	173,475

Pipeline and Storage Segment
Reported GAAP Earnings	$	22,087		$	17,749		$	40,192		$	42,851
Depreciation, Depletion and Amortization	13,356			11,293			24,960			22,407
Other (Income) Deductions	(1,361		)	(1,973		)	(2,739		)	(3,899		)
Interest Expense	7,152			7,500			14,264			14,786
Income Taxes	7,868			6,712			15,366			12,961
Adjusted EBITDA	$	49,102		$	41,281		$	92,043		$	89,106

Gathering Segment
Reported GAAP Earnings	$	19,898		$	12,690		$	35,842		$	26,872
Depreciation, Depletion and Amortization	5,279			4,673			10,418			9,351
Other (Income) Deductions	(18		)	(189		)	(14		)	(232		)
Interest Expense	2,160			2,345			4,379			4,723
Income Taxes	2,222			5,079			8,348			9,832
Adjusted EBITDA	$	29,541		$	24,598		$	58,973		$	50,546

Utility Segment
Reported GAAP Earnings	$	31,499		$	35,589		$	58,082		$	61,237
Depreciation, Depletion and Amortization	13,751			13,365			27,382			26,656
Other (Income) Deductions	12,094			11,618			17,906			17,834
Interest Expense	5,516			6,263			11,190			12,157
Income Taxes	10,332			11,853			18,095			18,373
Adjusted EBITDA	$	73,192		$	78,688		$	132,655		$	136,257

Corporate and All Other
Reported GAAP Earnings	$	(4,277	)	$	2,694		$	(2,294	)	$	2,209
Depreciation, Depletion and Amortization	390			445			786			916
Other (Income) Deductions	6,578			(3,262		)	5,018			2,372
Interest Expense	(1,829		)	(2,596		)	(3,897		)	(4,804		)
Income Taxes	(1,450		)	337			(1,200		)	(4,879		)
Adjusted EBITDA	$	(588	)	$	(2,382	)	$	(1,587	)	$	(4,186	)

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NATIONAL FUEL GAS CO Reports