Subsequent Events

12 Months Ended

Dec. 31, 2011

SUBSEQUENT EVENTS

On February 14, 2012, Energen completed the purchase of certain properties in the Permian Basin for a cash purchase price of $63 million (subject to closing adjustments). This purchase had an effective date of December 1, 2011. Energen acquired total proved reserves of approximately 8.5 MMBOE. Of the proved reserves acquired, an estimated 80 percent are undeveloped. Approximately 64 percent of the proved reserves are oil, 22 percent are natural gas liquids and natural gas comprises the remaining 14 percent. Energen Resources used its credit facilities and internally generated cash flows to finance the acquisition.

On February 21, 2012, Energen Resources Corporation entered into a definitive agreement with BHP Billiton (BHP) to buy a 50 percent undivided interest in three existing wells in Reeves County from Energen Resources for approximately $18 million. As a result of purchasing the wells, and subject to initiating horizontal completions of two of the wells, BHP will own a 50 percent undivided interest in 4,829 net acres. BHP will carry Energen Resources in completion operations of the two wells. The agreement also includes the option for BHP to purchase from Energen Resources a 50 percent undivided interest in 51,720 net acres in the Permian Basin. The option is exercisable on or before May 1, 2012, after BHP initiates the horizontal completion of one of the wells.