8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report

January 26, 2011

Commission File Number	Registrant	State of Incorporation	IRS Employer Identification Number
1-7810	Energen Corporation	Alabama	63-0757759
2-38960	Alabama Gas Corporation	Alabama	63-0022000

605 Richard Arrington Jr. Boulevard North Birmingham, Alabama	35203
(Address of principal executive offices)	(Zip Code)

(205) 326-2700

(Registrant’s telephone number including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.02 Results of Operations and Financial Condition

On January 26, 2011, Energen Corporation and Alabama Gas Corporation issued a press release announcing the fourth quarter and year-to-date 2010 financial results. The press release and supplemental financial information are attached hereto as Exhibit 99.1 and 99.2.

ITEM 7.01 Regulation FD Disclosure

Energen Corporation has included reconciliations of certain Non-GAAP financial measures to the related GAAP financial measures. These Non-GAAP financial measures will be disclosed at various investor/analyst meetings in the coming weeks. The reconciliations are attached hereto as exhibit 99.3.

ITEM 9.01 Financial Statements and Exhibits

(d) Exhibits.

The following exhibits are furnished as part of this Current Report on Form 8-K.

Exhibit Number:
99.1	Press Release dated January 26, 2011
99.2	Supplemental Financial Information
99.3	Non-GAAP Financial Measures Reconciliation

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	ENERGEN CORPORATION ALABAMA GAS CORPORATION
January 26, 2011	By	/s/ Charles W. Porter, Jr.
		Charles W. Porter, Jr. Vice President, Chief Financial Officer and Treasurer of Energen Corporation and Alabama Gas Corporation

EXHIBIT INDEX

EXHIBIT NUMBER	DESCRIPTION
99.1	* Press Release dated January 26, 2011
99.2	* Supplemental Financial Information
99.3	* Non-GAAP Financial Measures Reconciliation

* This exhibit is furnished to, but not filed with, the Commission by inclusion herein.

EX-99.1

Exhibit 99.1

For Release: 4:30 p.m. EDT	Contacts:   Julie S. Ryland
Wednesday, January 26, 2011	205.326.8421

Energen Announces 2010 Results

4^th Quarter Earnings Increase to $1.11 per Diluted Share

2011 Earnings Guidance Range Raised 10¢ Per Diluted Share

BIRMINGHAM, Alabama – Energen Corporation (NYSE: EGN) generated a 23 percent increase in 2010 earnings after normalizing results for a previously announced non-cash charge related to the company’s Alabama shale acreage. Energen’s 2010 net income (including the $24.75 million after-tax write-off of capitalized unproved leasehold) totaled $290.8 million, or $4.04 per diluted share, and compared with earnings of $256.3 million, or $3.57 cents per diluted share, in 2009. Energen’s net income excluding the write-off totaled $315.6 million, or $4.38 per diluted share. This substantial increase in year-over-year earnings largely was due to the impact of higher realized oil and natural gas prices and increased production on the earnings of Energen Resources Corporation, the company’s oil and gas exploration and production subsidiary.

Highlights of Energen’s 2010 year included record production of 18.8 million barrels of oil equivalents (MMBOE), or 113 billion cubic feet equivalent (Bcfe), and record year-end proved reserves of 303 MMBOE, or 1.8 trillion cubic feet equivalent (Tcfe).

Energen’s net income for the three months ended December 31, 2010, totaled $80.3 million, or $1.11 per diluted share, and compared with $58.6 million, or 81 cents per diluted share, in the fourth quarter of 2009. This 37 percent increase in earnings largely reflects higher realized sales prices and a 6 percent increase in year-over-year production.

• ENERGEN RAISES 2011 EARNINGS, CASH FLOW GUIDANCE RANGES

Energen raised its 2011 earnings guidance range by 10 cents to $3.35–$3.75 per diluted share. This 10-cent increase in the guidance range reflects recent 2011 hedges (see Energen’s news release dated January 10, 2011), known January commodity prices and basis differentials, and adjustments to depreciation, depletion, and amortization (DD&A) expense resulting from upward revisions in the company’s 2010 proved reserves.

Energen also increased its 2011 after-tax cash flow estimate to a range of $664-$693 million (previous estimate was $643-$672 million).

The company’s guidance assumptions for commodity prices remain unchanged at $4.25 per thousand cubic feet (Mcf) of natural gas, $80 per barrel of oil, and $0.83 per gallon of natural gas liquids (NGL).

Key assumptions in Energen’s 2011 guidance include:

• Hedge position covering approximately 69 percent of the company’s 2011 estimated production;

• A 9 percent increase in production to 20.5 MMBOE (123 Bcfe);

• An average DD&A rate at Energen Resources of $11.46 per barrel of oil equivalent (BOE);

• Lease operating expense (LOE), including production taxes, at Energen Resources of $12.18 per BOE (base LOE and marketing and transportation costs of $9.78 per BOE);

• General & administrative (G&A) expense at Energen Resources of $2.94 per BOE;

• Alabama Gas Corporation (Alagasco), the company’s utility subsidiary, earning on estimated average equity of $346 million;

• Capital spending of $667 million by Energen Resources and $75 million by Alagasco; and

• Average diluted shares outstanding of 72.2 million.

Energen Resources’ 2011 hedge position is as follows:

Commodity	Hedge Volumes		Estimated Production		Hedge %	NYMEXe Price
Natural Gas		52.4 Bcf		72.1 Bcf	73%		$6.20/Mcf
Oil		4.4 MMBO		6.4 MMBO	69%		$78.10/barrel
NGLs		42.8 MMgal		86.7 MMgal	49%		$0.90/gallon

NOTE: INCLUDES KNOWN BASIS DIFFERENTIALS

Energen Resources’ natural gas and oil hedge positions by hedge type for 2011 are as follows:

Natural Gas Hedges	Volumes (Bcf)	Assumed Differential	NYMEXe Price
San Juan Basin	38.1	$0.40 per Mcf	$6.09 per Mcf
NYMEX	14.3	—	$6.49 per Mcf
Oil Hedges	Volumes (MBO)	Assumed Differential	NYMEXe Price
Sour Oil (WTS)	2,076	$2.50 per barrel	$72.74 per barrel
NYMEX	2,345	—	$82.86 per barrel

NOTE: INCLUDES KNOWN BASIS DIFFERENTIALS

Sensitivity of 2011 Earnings, Cash Flows to Changes in Commodity Prices

Given Energen Resources’ current hedge position for 2011, changes in commodity prices are estimated to have the following impact on Energen’s 2011 earnings and cash flows:

• Every 10-cent change in the average NYMEX price of gas from $4.25 represents an estimated net income impact of approximately $725,000 (1.0 cents per diluted share).

• Every $1.00 change in the average NYMEX price of oil from $80 per barrel represents an estimated net income impact of approximately $1,085,000 (1.5 cents per diluted share).

• Every 1-cent change in the average price of liquids from $0.83 per gallon represents an estimated net income impact of approximately $230,000 (0.3 cents per diluted share).

Price-related events such as substantial basis differential changes could cause earnings sensitivities to be materially different from those outlined above.

2010 PROVED RESERVES INCREASE 17.5%

Energen Resources’ preliminary proved reserves at year-end 2010 increased 17.5 percent from the prior year and now total a record 303 MMBOE (1.8 Tcfe). In the Permian Basin alone, where Energen Resources has focused its acquisition and development efforts in 2009 and 2010, proved reserves at year-end 2010 jumped 44 percent to 132.8 MMBOE; the Permian Basin now is home to 44 percent of the company’s total proved reserves. Another 45 percent of the company’s reserves are in the San Juan Basin, while 9 percent are in the coalbed methane fields of the Black Warrior Basin. Natural gas comprises 53 percent of the company’s preliminary proved reserves, while oil and NGL make up the other 47 percent.

Proved Reserves, YE2009 to YE2010 (MMBOE)

Basin	YE2009		2010 Production			2010 Acquisitions		Additions/ Divestitures		Price/Other Revisions			YE2010
San Juan		131.5		(9.4	)		0.0		2.8		11.0			135.9
Permian		92.3		(6.2	)		25.8		22.0		(1.1	)		132.8
Black Warrior		26.0		(2.2	)		0.0		1.4		0.5			25.7
Other		8.0		(1.0	)		0.0		0.5		1.1			8.6
TOTAL		257.8		(18.8	)		25.8		26.7		11.5			303.0

NOTE: Preliminary reserve data

Proved reserves in 2010 were priced at $4.38 per Mcf of gas (vs. $3.87 per Mcf in the prior year), $79.43 per barrel of oil (vs. $61.18 per barrel in the prior year) and 98 cents per gallon of NGLs (vs. 71 cents per gallon in the prior year).

2010 FINANCIAL RESULTS

For the 12 months ended December 31, 2010, Energen’s net income totaled $290.8 million, or $4.04 per diluted share. This compares with 2009 net income of $256.3 million, or $3.57 per diluted share. Current-year results included $24.75 million (34 cents per diluted share) of non-cash, after-tax write-offs for capitalized unproved leasehold. Included in 2009 results is a one-time gain of $3.1 million, or 4 cents per diluted share, generated by the sale of a small, non-operated Permian Basin property.

Energen Resources’ net income in 2010 totaled $245.3 million ($270.1 million excluding the write-off) as compared with 2009 net income of $212.1 million. Alagasco’s 2010 net income totaled $46.9 million as compared with $45.4 million in 2009.

Energen Resources Corporation

Energen Resources’ year-over-year increase in net income largely reflected the impact of higher realized sales prices and increased production partially offset by the non-cash charges, increased DD&A expense, higher exploration expense, and a rise in commodity price-driven production taxes.

Average Realized Sales Prices

Commodity	2010		2009		Change
Natural Gas (per Mcf)	$	6.82	$	6.36		7	%
Oil (per barrel)	$	78.86	$	60.72		30	%
NGL (per gallon)	$	0.83	$	0.89		(7	)%

Production

Commodity	2010		2009		Change
Natural Gas (Bcf)		70.9		72.3		(2	)%
Oil (MBO)		5,131		4,690		9	%
NGL (MMgal)		79.0		75.2		5	%
Total (Bcfe)		113.0		111.2		2	%
Total (MBOE)		18,832		18,537		2	%

Production by Area

Area	2010		2009		Change
San Juan Basin (Bcfe)		56.3		54.9		3	%
Permian Basin (MBOE)		6,160		5,633		9	%
Black Warrior Basin (Bcfe)		13.1		14.3		(8	)%
N. LA/E. TX/Other (Bcfe)		6.6		8.2		(20	)%

Permian Basin production increased in 2010 largely due to the June 2009 acquisition of Range Resources Corporation’s interests in the Fuhrman-Mascho field and new waterflood development in the North Westbrook unit. San Juan Basin production increased largely due to new well development and better-than-expected performance from certain Fruitland Coal wells. Decreased production in the Black Warrior Basin and other areas, while large on a percentage basis, is relatively slight in terms of volumes and reflects the company’s capital investment focus in its Permian Basin oil properties and normal property declines.

Total LOE per unit in 2010 increased 2 percent from 2009 to $11.94 per BOE. Base LOE and marketing and transportation expenses decreased about 1 percent while commodity price-drive production taxes rose 19 percent on a per-unit basis.

DD&A expense per unit in 2010 increased 9 percent from 2009 to $10.62 per BOE largely due to higher development costs and price-related reserve revisions at year-end 2009.

Per-unit net G&A expense of $2.82 per BOE was unchanged in 2010.

Alabama Gas Corporation

Energen’s natural gas utility generated net income of $46.9 million in 2010 as compared with $45.4 million in 2009. This slight increase primarily reflected the utility’s ability to earn on a higher level of equity largely offset by the timing of rate recovery and revenue reductions under Alagasco’s rate-setting mechanism.

Fourth Quarter 2010 Results

Energen’s consolidated net income for the three months ended December 31, 2010, totaled $80.3 million, or $1.11 per diluted share, and compared with $58.6 million, or 81 cents per diluted share, in the fourth quarter of 2009.

Energen Resources Corporation

Energen Resources’ fourth quarter 2010 net income totaled $70.6 million as compared with $51.1 million in the same period a year ago. This increase largely reflected the impact of higher realized sales prices and increased production.

Average Realized Sales Prices, Fourth Quarter Comparison

Commodity	4Q10		4Q09		Change
Natural Gas (per Mcf)	$	6.53	$	6.55		NM
Oil (per barrel)	$	80.93	$	64.98		25	%
NGL (per gallon)	$	0.87	$	0.99		(12	)%

Production, Fourth Quarter Comparison

Commodity	4Q10		4Q09		Change
Natural Gas (Bcf)		18.2		17.8		2	%
Oil (MBO)		1,397		1,234		13	%
NGL (MMgal)		21.3		19.3		10	%
Total (Bcfe)		29.6		28.0		6	%
Total (MBOE)		4,931		4,660		6	%

Production by Area Fourth Quarter Comparison

Area	4Q10		4Q09		Change
San Juan Basin (Bcfe)		14.6		13.6		7	%
Permian Basin (MBOE)		1,690		1,478		14	%
Black Warrior Basin (Bcfe)		3.3		3.5		(6	)%
N. LA/E. TX/Other (Bcfe)		1.5		2.0		(25	)%

In the Permian Basin, fourth quarter 2010 production increased 14 percent due to the company’s two recent Wolfberry acquisitions and development drilling in the Fuhrman-Mascho and North Westbrook units. In the San Juan Basin, production increased largely due to improved performance in certain Fruitland Coal wells due to added compression. Decreased production in the Black Warrior Basin and other areas primarily reflects the company’s capital investment focus on its Permian Basin oil properties and normal property declines.

Total per-unit LOE in the fourth quarter of 2010 decreased 6 percent from the same period a year ago to $11.76 per BOE. Base LOE and marketing and transportation expenses decreased 7 percent largely due to fewer workovers and repairs-and-maintenance; commodity price-driven production taxes decreased 5 percent on a per-unit basis.

DD&A expense per unit in the fourth quarter of 2010 increased 1 percent over the same period last year to $10.62 per BOE.

Per-unit net G&A expense in the fourth quarter of 2010 declined 20 percent over the same period in 2009 to $2.46 per BOE largely due to certain legal expenses and benefits-related expenses.

Alabama Gas Corporation

Alagasco’s fourth quarter 2010 net income totaled $10.1 million as compared with $7.8 million in the fourth quarter of 2009. This improvement largely reflects the timing of rate recovery and the utility’s ability to earn on a higher level of equity.

STRONG HEDGE POSITIONS IN 2012-2014

Energen continues to utilize hedging of its flowing production in future years to help protect projected earnings and cash flows from commodity price volatility. Energen’s hedge positions in 2012-2014 are provided in the tables below.

2012

Energen Resources’ hedge position for 2012 is as follows:

Commodity	Hedge Volumes		NYMEXe Price
Natural Gas		40.5 Bcf	$	5.02/Mcf
Oil		3.7 MMBO	$	82.34/barrel
NGLs		39.9 MMgal	$	0.86/gallon

Energen Resources’ natural gas and oil hedge positions by hedge type for 2012 are as follows:

Natural Gas Hedges	Volumes (Bcf)		Assumed Differential		NYMEXe Price
San Juan Basin		29.5	$	0.40 per Mcf	$	5.00 per Mcf
NYMEX		11.0		—	$	5.07 per Mcf
Oil Hedges	Volumes (MBO)		Assumed Differential		NYMEXe Price
Sour Oil (WTS)		672	$	2.80 per barrel	$	84.20 per barrel
NYMEX		3,072		—	$	81.94 per barrel

2013

Energen Resources’ hedge position for 2013 is as follows:

Commodity	Hedge Volumes		NYMEXe Price
Natural Gas		28.0 Bcf	$	5.30/Mcf
Oil (NYMEX)		3.2 MMBO	$	85.32/barrel

Energen Resources’ natural gas hedge position by hedge type for 2013 is as follows:

Natural Gas Hedges	Volumes (Bcf)		Assumed Differential		NYMEXe Price
San Juan Basin		19.2	$	0.40 per Mcf	$	5.30 per Mcf
NYMEX		8.8		—	$	5.30 per Mcf

2014

Energen Resources’ hedge position for 2014 is as follows:

Commodity	Hedge Volumes		NYMEXe Price
Oil (NYMEX)		2.7 MMBO	$	87.44/barrel

Average realized oil and gas prices for Energen Resources’ production associated with NYMEX contracts as well as for unhedged production will reflect the impact of basis differentials. Average realized NGL prices will be net of transportation and fractionation fees. For production associated with basin-specific contracts, Energen Resources will receive the contracted hedge price. Energen typically hedges basis differentials where applicable. In the tables above, the basin-specific contract prices were converted for comparability purposes to a NYMEX-equivalent price by adding to them Energen Resources’ assumed basis differentials.

Energen Corporation is a diversified energy holding company with headquarters in Birmingham, Alabama. Its dominant business is the acquisition, development, and exploration of oil, natural gas, and natural gas liquids. Through Energen Resources Corporation, the company has more than 615 million barrels of oil-equivalent proved, probable, and possible reserves. These all-domestic reserves are located mainly in the San Juan and Permian basins. Energen subsidiary Alabama Gas Corporation is the largest distributor of natural gas in Alabama and has a business heritage in the state spanning more than 150 years. For more information, go to
http://www.energen.com.

This release contains statements expressing expectations of future plans, objectives and performance that constitute forward-looking statements made pursuant to the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Except as otherwise disclosed, the Company’s forward-looking statements do not reflect the impact of possible or pending acquisitions, divestitures or restructurings. We undertake no obligation to correct or update any forward-looking statements, whether as a result of new information, future events or otherwise. All statements based on future expectations rather than on historical facts are forward-looking statements that are dependent on certain events, risks and uncertainties that could cause actual results to differ materially from those anticipated. In addition, the Company cannot guarantee the absence of errors in input data, calculations and formulas used in its estimates, assumptions and forecasts. A more complete discussion of risks and uncertainties that could affect future results of Energen and its subsidiaries is included in the Company’s periodic reports filed with the Securities and Exchange Commission.

Financial, operating, and support data pertaining to all 2010 reporting periods included in this release are unaudited and subject to revision.

EX-99.2

Exhibit 99.2

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

For the 3 months ending December 31, 2010 and 2009

	4th Quarter
(in thousands, except per share data)	2010			2009			Change
Operating Revenues
Oil and gas operations	$	252,451		$	216,388		$	36,063
Natural gas distribution		121,640			146,417			(24,777	)
Total operating revenues		374,091			362,805			11,286
Operating Expenses
Cost of gas		54,038			73,771			(19,733	)
Operations and maintenance		99,584			105,775			(6,191	)
Depreciation, depletion and amortization		62,840			62,776			64
Taxes, other than income taxes		20,453			21,230			(777	)
Accretion expense		1,610			1,330			280
Total operating expenses		238,525			264,882			(26,357	)
Operating Income		135,566			97,923			37,643
Other Income (Expense)
Interest expense		(9,827	)		(9,793	)		(34	)
Other income		1,730			914			816
Other expense		(102	)		(101	)		(1	)
Total other expense		(8,199	)		(8,980	)		781
Income Before Income Taxes		127,367			88,943			38,424
Income tax expense		47,117			30,322			16,795
Net Income	$	80,250		$	58,621		$	21,629
Diluted Earnings Per Average Common Share	$	1.11		$	0.81		$	0.30
Basic Earnings Per Average Common Share	$	1.12		$	0.82		$	0.30
Diluted Avg. Common Shares Outstanding		72,081			72,057			24
Basic Avg. Common Shares Outstanding		71,862			71,701			161
Dividends Per Common Share	$	0.13		$	0.125		$	0.005

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

For the 12 months ending December 31, 2010 and 2009

	Year-to-date
(in thousands, except per share data)	2010			2009			Change
Operating Revenues
Oil and gas operations	$	958,762		$	822,546		$	136,216
Natural gas distribution		619,772			617,874			1,898
Total operating revenues		1,578,534			1,440,420			138,114
Operating Expenses
Cost of gas		316,988			306,054			10,934
Operations and maintenance		429,165			380,625			48,540
Depreciation, depletion and amortization		247,865			235,084			12,781
Taxes, other than income taxes		84,961			78,329			6,632
Accretion expense		6,178			4,935			1,243
Total operating expenses		1,085,157			1,005,027			80,130
Operating Income		493,377			435,393			57,984
Other Income (Expense)
Interest expense		(39,222	)		(39,379	)		157
Other income		4,285			4,972			(687	)
Other expense		(643	)		(690	)		47
Total other expense		(35,580	)		(35,097	)		(483	)
Income Before Income Taxes		457,797			400,296			57,501
Income tax expense		166,990			143,971			23,019
Net Income	$	290,807		$	256,325		$	34,482
Diluted Earnings Per Average Common Share	$	4.04		$	3.57		$	0.47
Basic Earnings Per Average Common Share	$	4.05		$	3.58		$	0.47
Diluted Avg. Common Shares Outstanding		72,051			71,885			166
Basic Avg. Common Shares Outstanding		71,845			71,667			178
Dividends Per Common Share	$	0.52		$	0.50		$	0.02

SELECTED BUSINESS SEGMENT DATA (UNAUDITED)

For the 3 months ending December 31, 2010 and 2009

	4th Quarter					Change
(in thousands, except sales price data)	2010			2009
Oil and Gas Operations
Operating revenues
Natural gas	$	118,633		$	116,686	$	1,947
Oil		113,082			80,163		32,919
Natural gas liquids		18,626			19,042		(416	)
Other		2,110			497		1,613
Total	$	252,451		$	216,388	$	36,063
Production volumes
Natural gas (MMcf)		18,156			17,805		351
Oil (MBbl)		1,397			1,234		163
Natural gas liquids (MMgal)		21.3			19.3		2.0
Total production volumes (MMcfe)		29,588			27,965		1,623
Revenue per unit of production including effects of all derivative instruments
Natural gas (Mcf)	$	6.53		$	6.55	$	(0.02	)
Oil (barrel)	$	80.93		$	64.98	$	15.95
Natural gas liquids (gallon)	$	0.87		$	0.99	$	(0.12	)
Other data
Lease operating expense (LOE)
LOE and other	$	46,215		$	47,054	$	(839	)
Production taxes		11,659			11,492		167
Total	$	57,874		$	58,546	$	(672	)
Depreciation, depletion and amortization	$	53,176		$	49,900	$	3,276
General and administrative expense	$	12,230		$	14,384	$	(2,154	)
Capital expenditures	$	330,972		$	73,975	$	256,997
Exploration expense	$	10,217		$	8,860	$	1,357
Operating income	$	117,344		$	83,368	$	33,976
Natural Gas Distribution
Operating revenues
Residential	$	80,441		$	94,097	$	(13,656	)
Commercial and industrial		31,442			36,013		(4,571	)
Transportation		15,006			15,044		(38	)
Other		(5,249	)		1,263		(6,512	)
Total	$	121,640		$	146,417	$	(24,777	)
Gas delivery volumes (MMcf)
Residential		4,790			5,137		(347	)
Commercial and industrial		2,250			2,320		(70	)
Transportation		12,491			11,129		1,362
Total		19,531			18,586		945
Other data
Depreciation and amortization	$	9,662		$	12,876	$	(3,214	)
Capital expenditures	$	17,756		$	20,702	$	(2,946	)
Operating income	$	19,005		$	15,140	$	3,865

SELECTED BUSINESS SEGMENT DATA (UNAUDITED)

For the 12 months ending December 31, 2010 and 2009

	Year-to-date
(in thousands, except sales price data)	2010			2009		Change
Oil and Gas Operations
Operating revenues
Natural gas	$	483,935		$	460,370	$	23,565
Oil		404,625			284,750		119,875
Natural gas liquids		65,161			67,254		(2,093	)
Other		5,041			10,172		(5,131	)
Total	$	958,762		$	822,546	$	136,216
Production volumes
Natural gas (MMcf)		70,924			72,337		(1,413	)
Oil (MBbl)		5,131			4,690		441
Natural gas liquids (MMgal)		79.0			75.2		3.8
Total production volumes (MMcfe)		112,989			111,224		1,765
Revenue per unit of production including effects of all derivative instruments
Natural gas (Mcf)	$	6.82		$	6.36	$	0.46
Oil (barrel)	$	78.86		$	60.72	$	18.14
Natural gas liquids (gallon)	$	0.83		$	0.89	$	(0.06	)
Other data
Lease operating expense (LOE)
LOE and other	$	182,180		$	181,777	$	403
Production taxes		42,721			35,652		7,069
Total	$	224,901		$	217,429	$	7,472
Depreciation, depletion and amortization	$	203,821		$	184,089	$	19,732
General and administrative expense	$	52,549		$	52,214	$	335
Capital expenditures	$	717,782		$	427,399	$	290,383
Exploration expense	$	64,584		$	10,234	$	54,350
Operating income	$	406,729		$	353,645	$	53,084
Natural Gas Distribution
Operating revenues
Residential	$	414,870		$	399,760	$	15,110
Commercial and industrial		159,658			162,141		(2,483	)
Transportation		57,049			54,312		2,737
Other		(11,805	)		1,661		(13,466	)
Total	$	619,772		$	617,874	$	1,898
Gas delivery volumes (MMcf)
Residential		24,463			20,921		3,542
Commercial and industrial		10,985			9,934		1,051
Transportation		46,479			40,903		5,576
Total		81,927			71,758		10,169
Other data
Depreciation and amortization	$	44,042		$	50,995	$	(6,953	)
Capital expenditures	$	93,566		$	77,809	$	15,757
Operating income	$	88,383		$	83,984	$	4,399

EX-99.3

Exhibit 99.3

Non-GAAP Financial Measures

The United States Securities and Exchange Commission requires public companies, such as Energen Corporation (the Company), to reconcile Non-GAAP (GAAP refers to generally accepted accounting principles) financial measures to related GAAP measures. After-tax Cash Flows is a Non-GAAP financial measure. Energen believes after-tax cash flows are relevant because they are a measure of cash available to fund the Company’s capital expenditures, dividends, debt reduction, and other investments. Additionally, Net Income excluding the non-cash after-tax unproved leasehold write-off is a Non-GAAP financial measure. Energen believes that excluding it for comparative purposes better reflects financial performance of the Company’s on-going operations.

Reconciliation To GAAP Information

($ in millions)

	Years Ended 12/31
	2010 Actual			2011 Estimate (e)
Net Income (GAAP)		291			242	—	271
Depreciation, depletion and amortization		248			279	—	279
Deferred income taxes, net		134			143	—	143
After-tax Cash Flows (Non-GAAP)		673			664	—	693
Changes in assets and liabilities and other adjustments		(4	)		40	—	40
Net Cash Provided by Operating Activities (GAAP)		669			704	—	733

Consolidated Net Income

($ in millions except per share data)

	Twelve Months Ended 12/31/2010
	Net Income		Per Diluted Share
Net Income (GAAP)		290.8		4.04
Non-cash leasehold write-off (net of $14.9 tax)		24.8		0.34
Net Income (Non-GAAP)		315.6		4.38

Energen Resources Net Income

($ in millions)

	Twelve Months Ended  12/31/2010
Net Income (GAAP)		245.3
Non-cash leasehold write-off (net of $14.9 tax)		24.8
Net Income (Non-GAAP)		270.1

(e) This estimate is a “forward-looking statement” as defined by the Securities and Exchange Commission. All statements based on future expectations rather than on historical facts are forward-looking statements that are dependent on certain events, risks and uncertainties that could cause actual results to differ materially from those anticipated. In addition, the Company cannot guarantee the absence of errors in input data, calculations and formulas used in its estimates, assumptions and forecasts. A discussion of risks and uncertainties, which could affect future results of Energen and its subsidiaries, is included in the Company’s periodic reports filed with the Securities and Exchange Commission.