Supplemental Oil and Gas Reserve Information — Unaudited

The reserve estimates at December 31, 2013, 2012 and 2011 presented in the table below are based on reports prepared by DeGolyer and MacNaughton, the Company’s independent reserve engineers, in accordance with the FASB’s authoritative guidance on oil and gas reserve estimation and disclosures. At December 31, 2013, 2012 and 2011, all of the Company’s oil and natural gas producing activities were conducted within the continental United States.

The Company emphasizes that reserve estimates are inherently imprecise and that estimates of new discoveries and undeveloped locations are more imprecise than estimates of established proved producing oil and natural gas properties. Accordingly, these estimates are expected to change as future information becomes available.

Proved oil and natural gas reserves are the estimated quantities of oil and natural gas which geological and engineering data demonstrate, with reasonable certainty, to be recoverable in future years from known reservoirs under economic and operating conditions (i.e., prices and costs) existing at the time the estimate is made. Proved developed oil and natural gas reserves are proved reserves that can be expected to be recovered through existing wells and equipment in place and under operating methods being utilized at the time the estimates were made.

Estimated Quantities of Proved Oil and Natural Gas Reserves — Unaudited

The following table sets forth the Company’s estimated net proved, proved developed and proved undeveloped reserves at December 31, 2013, 2012 and 2011:



	Oil (MBbl)		Gas (MMcf)		MBoe
2011
Proved reserves
Beginning balance	36,550		19,379		39,780
Revisions of previous estimates	(262	)	(159	)	(288	)
Extensions, discoveries and other additions	36,464		40,220		43,168
Sales of reserves in place	(56	)	(518	)	(142	)
Purchases of reserves in place	100		65		111
Production	(3,732	)	(1,087	)	(3,914	)
Net proved reserves at December 31, 2011	69,064		57,900		78,715
Proved developed reserves, December 31, 2011	31,749		24,535		35,839
Proved undeveloped reserves, December 31, 2011	37,315		33,365		42,876
2012
Proved reserves
Beginning balance	69,064		57,900		78,715
Revisions of previous estimates	(567	)	(8,495	)	(1,983	)
Extensions, discoveries and other additions	66,245		45,759		73,871
Sales of reserves in place	—		—		—
Purchases of reserves in place	881		512		966
Production	(7,533	)	(4,146	)	(8,224	)
Net proved reserves at December 31, 2012	128,090		91,530		143,345
Proved developed reserves, December 31, 2012	62,602		44,695		70,051
Proved undeveloped reserves, December 31, 2012	65,488		46,835		73,294
2013
Proved reserves
Beginning balance	128,090		91,530		143,345
Revisions of previous estimates	3,390		10,411		5,125
Extensions, discoveries and other additions	40,784		31,856		46,094
Sales of reserves in place	—		—		—
Purchases of reserves in place	37,459		49,631		45,731
Production	(11,133	)	(7,450	)	(12,375	)
Net proved reserves at December 31, 2013	198,590		175,979		227,920
Proved developed reserves, December 31, 2013	106,774		92,170		122,136
Proved undeveloped reserves, December 31, 2013	91,816		83,809		105,784

Purchases of Reserves in Place

In 2013, the Company purchased 45,731 MBoe of estimated net proved reserves from properties acquired in the West Williston Acquisition and the East Nesson Acquisitions. In 2012, the Company purchased 966 MBoe of estimated net proved reserves from properties acquired in Burke and Mountrail counties. The Company had no significant reserve purchases in 2011.

Extensions, Discoveries and Other Additions

In 2013, the Company had a total of 46,094 MBoe of additions due to extensions and discoveries. An estimated 22,190 MBoe of these extensions and discoveries were associated with new producing wells at December 31, 2013, with 100% of these reserves from wells producing in the Bakken or Three Forks formations. An additional 23,904 MBoe of proved undeveloped reserves were added across all three of the Company’s Williston Basin project areas associated with the Company’s 2013 operated and non-operated drilling program, with 100% of these proved undeveloped reserves in the Bakken or Three Forks formations.

In 2012, the Company had a total of 73,871 MBoe of additions due to extensions and discoveries. An estimated 16,548 MBoe of these extensions and discoveries were associated with new producing wells at December 31, 2012, with 100% of these reserves from wells producing in the Bakken or Three Forks formations. An additional 57,323 MBoe of proved undeveloped reserves were added across all three of the Company’s Williston Basin project areas associated with the Company’s 2012 operated and non-operated drilling program, with 100% of these proved undeveloped reserves in the Bakken or Three Forks formations.

In 2011, the Company had a total of 43,168 MBoe of additions. An estimated 12,696 MBoe of extensions and discoveries were associated with new producing wells at December 31, 2011, with 100% of these reserves from wells producing in the Bakken or Three Forks formations. An additional 30,472 MBoe of proved undeveloped reserves were added across all three of the Company’s Williston Basin project areas associated with the Company’s 2011 operated and non-operated drilling program, with 100% of these proved undeveloped reserves in the Bakken or Three Forks formations.

Sales of Reserves in Place

In 2013 and 2012, the Company did not have any sales of reserves. In November 2011, the Company sold its remaining interests in non-core oil and gas producing properties located in the Barnett shale in Texas, which had a minimal impact on the Company’s estimated net proved reserves.

Revisions of Previous Estimates

In 2013, the Company had a net positive revision of 5,125 MBoe, or 3.6% of the beginning of the year estimated net proved reserves balance. This net positive revision was the result of several immaterial changes, including well performances, working interests, operating costs and realized prices.

In 2012, the Company had a net negative revision of 1,983 MBoe, or 2.5% of the beginning of the year estimated net proved reserves balance. The primary causes for this revision were negative well performances offset by working interest increases in the proved locations. Actual well results in portions of the Company’s acreage came in below the proved forecasts prepared in 2011. The proved forecasts for the 2012 reserve report have been adjusted to reflect these well performances. The working interest increases arose from acreage trades, non-participation by other interest owners and additional mineral leasing in the reserve locations. Operating costs and realized prices had an immaterial impact to the reserves balance.

In 2011, the Company had a net negative revision of 288 MBoe, or 0.7% of the beginning of the year estimated net proved reserves balance. This net negative revision was the result of several immaterial changes, including well performances, net revenue interest changes, operating costs and realized prices.

Standardized Measure of Discounted Future Net Cash Flows Relating to Proved Oil and Natural Gas Reserves — Unaudited

The Standardized Measure represents the present value of estimated future net cash flows from estimated net proved oil and natural gas reserves, less future development, production, plugging and abandonment costs and income tax expenses, discounted at 10% per annum to reflect timing of future cash flows. Production costs do not include depreciation, depletion and amortization of capitalized acquisition, exploration and development costs.

The Company’s estimated net proved reserves and related future net revenues and Standardized Measure were determined using index prices for oil and natural gas, without giving effect to derivative transactions, and were held constant throughout the life of the properties. The unweighted arithmetic average first-day-of-the-month prices for the prior twelve months were $96.96/Bbl for oil and $3.66/MMBtu for natural gas for the year ended December 31, 2013, $94.68/Bbl for oil and $2.75/MMBtu for natural gas for the year ended December 31, 2012 and $96.23/Bbl for oil and $4.12/MMBtu for natural gas for the year ended December 31, 2011. These prices were adjusted by lease for quality, transportation fees, geographical differentials, marketing bonuses or deductions and other factors affecting the price received at the wellhead.

The following table sets forth the Standardized Measure of discounted future net cash flows from projected production of the Company’s estimated net proved reserves at December 31, 2013, 2012 and 2011.



	At December 31,
	2013			2012			2011
	(In thousands)
Future cash inflows	$	19,063,500		$	11,321,992		$	6,508,604
Future production costs	(5,473,767		)	(2,809,960		)	(1,690,264		)
Future development costs	(1,904,095		)	(1,434,648		)	(783,486		)
Future income tax expense	(3,628,977		)	(2,123,973		)	(1,225,395		)
Future net cash flows	8,056,661			4,953,411			2,809,459
10% annual discount for estimated timing of cash flows	(4,329,102		)	(2,693,514		)	(1,489,988		)
Standardized measure of discounted future net cash flows	$	3,727,559		$	2,259,897		$	1,319,471

The following table sets forth the changes in the Standardized Measure of discounted future net cash flows applicable to estimated net proved reserves for the periods presented.



	2013			2012			2011
	(In thousands)
January 1,	$	2,259,897		$	1,319,471		$	485,735
Net changes in prices and production costs	254,979			(7,814		)	299,108
Net changes in future development costs	57,566			28,124			(38,244		)
Sales of oil and natural gas, net	(857,540		)	(542,515		)	(262,485		)
Extensions	1,111,202			1,358,479			989,697
Discoveries	—			—			—
Purchases of reserves in place	858,382			15,890			2,679
Sales of reserves in place	—			—			(2,499		)
Revisions of previous quantity estimates	99,954			(47,957		)	(5,058		)
Previously estimated development costs incurred	373,912			480,925			146,847
Accretion of discount	346,068			190,370			69,782
Net change in income taxes	(774,910		)	(400,196		)	(372,146		)
Changes in timing and other	(1,951		)	(134,880		)	6,055
December 31,	$	3,727,559		$	2,259,897		$	1,319,471