National Fuel Gas Company Annual Report 2012

FY2012 Annual Report · National Fuel Gas Company

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Fueled by TalenT driven by value

Fueled by talent and driven by value:
National Fuel’s highly talented workforce has
the expertise to produce results, even under
challenging economic conditions. Equally
important is the Company’s proven ability to
identify and create value for shareholders
and customers. These qualities are key to
National Fuel’s success. With a solid track
record of maximizing the value of its assets
across multiple operating segments, combined
with its industry-leading footprint in the
Marcellus Shale, National Fuel is extremely
well positioned for growth as the nation
increasingly recognizes natural gas as the best
fuel choice for consumers, the environment
and energy security.

National Fuel Gas Company
6363 Main Street, Williamsville, New York 14221
716-857-7000 www.nationalfuelgas.com
NYSE: NFG

National Fuel Gas Company
SuM MarY aN N ual rE port 2012

On the Cover: Seneca Resources’ Sespe Field in
California has been producing oil for over a century.
In 2012, Seneca began production from the first
new wells drilled in more than 20 years, demonstrating
its ability to successfully optimize mature assets.

Inside: At-A-Glance

upsTream

midsTream

downsTream

invesTor inFormaTion

National Fuel Gas Company is
an integrated, diversified energy
company with four financial
reporting segments: Exploration and
Production, Pipeline and Storage,
Utility, and Energy Marketing.

National Fuel’s upstream operations are carried
out by the Exploration and production segment
through Seneca resources Corporation, a
natural gas and crude oil producer focused on
developing its resources in California and
within its extensive appalachian acreage position.
the Company’s Midstream operations are
administered by the interstate pipeline, gathering
and storage subsidiaries, including National
Fuel Gas Supply Corporation, Empire pipeline,
Inc. and National Fuel Gas Midstream
Corporation. these subsidiaries develop and
operate pipeline and related facilities to serve
appalachian producers and downstream shippers.
the utility and Energy Marketing segments,
operated by National Fuel Gas Distribution
Corporation and National Fuel resources, Inc.,
perform National Fuel’s Downstream activities and
provide natural gas retail services to customers
in New York and pennsylvania.

PHOtO CAPtiONs
Upstream: Andrew Shepherd, an employee of Seneca Resources
Corporation, monitors a Marcellus Shale well completion in Lycoming
County, Pa.

Midstream: National Fuel Gas Supply Corporation’s Josh Corey
inspects new facilities being constructed at the Wales, N.Y.
Compressor Station.

Downstream: Cathy Martorana of National Fuel Gas Distribution
Corporation oversees customer operations in the New York
Consumer Response Center, ensuring excellent customer service.

ExPloration
& ProdUCtion

Seneca resources Corporation explores for,
develops and produces natural gas and crude
oil reserves in appalachia, California and Kansas.
Most of Seneca’s investment activity is in
the Marcellus Shale in pennsylvania, where the
company controls 775,000 net prospective acres.

2 012 H iG H liG Hts:

Operating Revenues:
$558.2 million(1)

Operating income:
$203.3 million(2)

Net income:
$96.5 million

Capital Expenditures:
$693.8 million

total Assets:
$2.367 billion

total Annual Production:
83.4 Bcfe

• total natural gas and crude oil proved reserves increased 33%

from the prior year, reaching 1.246 tcfe at September 30, 2012.

• Seneca’s three-year average finding and development costs were

$1.87 per Mcfe, a decrease of 11% as compared to the prior
three-year period ended September 30, 2011.

• Crude oil production in Seneca’s West Division grew 8%

compared to the prior year.

• Marcellus Shale production increased 58% from the prior year,

reaching 55.8 Bcfe in 2012.

2 013 OutlO Ok:

• produce 95 to 107 Bcfe of natural gas and crude oil, representing
a 21% increase at the midpoint when compared to the prior year.

• Increase the focus on Seneca’s crude oil activities, spending

approximately $80 to $110 million on projects within its expanding
California operations, as well as its newly acquired acreage in the
Mississippian lime play in Kansas.

• Continue ongoing delineation efforts in the Marcellus and

utica shales across a broad section of Seneca’s pennsylvania
acreage position.

Index

Bcf Billion cubic feet (of natural gas)

Bcfe Bcf equivalent (of natural gas and crude oil)

Dth Dekatherm (Approx. 1 Mcf of natural gas)

Mcf Thousand cubic feet (of natural gas)

Mcfe Mcf equivalent (of natural gas and crude oil)

MMcf Million cubic feet (of natural gas)

Tcf Trillion cubic feet (of natural gas)

Tcfe Tcf equivalent (of natural gas and crude oil)

Note
Footnotes are located on the inside back cover of this report.

PiPElinE &
StoragE

National Fuel Gas Supply Corporation and Empire
pipeline, Inc. provide natural gas transportation
and storage services through an integrated system
of 2,806 miles of pipeline and 31 underground
storage fields.

2 012 H iG H liG Hts:

Operating Revenues:
$259.3 million(1)

Operating income:
$120.4 million(2)

Net income:
$60.5 million

Capital Expenditures:
$144.2 million

total Assets:
$1.244 billion

system throughput:
371.1 Bcf

• Commenced construction of the line N 2012 Expansion project,
which moves 163,000 Dth per day of Marcellus production, and
placed it fully in service November 2012.

• Started building facilities for the Northern access Expansion
project, designed to move 320,000 Dth per day of Marcellus
production to transCanada pipeline at the Canadian Border.
the project commenced service November 2012.

2 013 OutlO Ok:

• Continue to aggressively pursue new projects, focusing primarily

on serving Marcellus and utica producers in pennsylvania and ohio.

• Maintain progress with ongoing efforts to upgrade transmission
pipeline and storage assets to ensure safe and reliable natural
gas delivery.

Utility

National Fuel Gas Distribution Corporation sells
or transports natural gas to customers through a
local distribution system located in western
New York and northwestern pennsylvania.

2 012 H iG H liG Hts:

Operating Revenues:
$719.1 million(1)

Operating income:
$117.2 million(2)

Net income:
$58.6 million

Capital Expenditures:
$58.3 million

total Assets:
$2.070 billion

system throughput:
125.1 Bcf

• More than 75% of capital expenditures are allocated to system

safety, maintenance and enhancements.

• assisted qualifying customers in receiving $51 million in HEap

and lIHEap funding in New York and pennsylvania.

• received regulatory approval to extend a successful energy

conservation program through 2015.

2 013 OutlO Ok:

• Continue to modernize the local distribution system and further

promote natural gas as the safe, reliable, clean and economic fuel
choice for homes, businesses and vehicles.

• address the current challenge of providing continuous natural

gas service to payment-troubled, low-income customers through
enhanced outreach and targeted assistance programs.

• Initiate a multi-year program to upgrade the Customer

Information System.

gatHEring &
ProCESSing

National Fuel Gas Midstream Corporation’s primary
business is to build, own and operate natural gas
processing and pipeline gathering facilities in the
appalachian region.

EnErgy
MarkEting

National Fuel resources, Inc. sells competitively
priced natural gas to industrial, wholesale,
commercial, public authority and residential
customers primarily in New York and pennsylvania.

20 12 H iG H liG Hts:

Operating Revenues:
$17.5 million(1)

Operating income:
$13.1 million(2)

Net income:
$6.9 million(3)

Capital Expenditures:
$80.0 million(4)

total Assets:
$116.8 million(5)

Gathering Volumes:
44.3 Bcf

• Completed initial construction and initiated flow on the 466,000 Mcf
per day trout run Gathering System and its interconnection with the
transco pipeline in lycoming County, pa., during May 2012, allowing
Marcellus production to be transported to major markets.

2 013 OutlO Ok:

• Continue to add facilities to both the trout run and Covington

gathering systems to facilitate the transportation of additional volumes.

• Evaluate potential expansion opportunities for new projects to serve
both Seneca resources and third party producers in the Marcellus
and utica shales.

20 12 H iG H liG Hts:

Operating Revenues:
$188.0 million(1)

Operating income:
$5.9 million(2)

Net income:
$4.2 million

total Assets:
$62.0 million

total sales Volume:
45.8 Bcf

• Successfully expanded residential customer base

in pennsylvania.

2 013 Outl O Ok:

• Continue customer growth within current markets.

• Maintain high levels of customer satisfaction and retention.

• Implement new customer billing and accounting software

to support evolving needs of the business.

Common Stock Transfer
Agent and Registrar

Wells Fargo Shareowner Services

p.o. Box 64856

St. paul, MN 55164-0856

tel.: 800-648-8166

Website:

http://www.shareowneronline.com

Email:

Fargo Shareowner Services, the

Investor Relations

Additional Shareholder Reports

administrator of the plan, at the

Investors or financial analysts

additional copies of this report,

address listed above.

desiring information should contact:

the 2012 Form 10-K, and the 2012

Trustee for Debentures

the Bank of New York Mellon

101 Barclay Street, 8W

New York, NY 10286

Stock Exchange Listing

New York Stock Exchange

David p. Bauer

treasurer

tel.: 716-857-7318

timothy J. Silverstein

Director, Investor relations

tel.: 716-857-6987

Financial and Statistical report

can be obtained without charge

by writing to or calling:

paula M. Ciprich

Corporate Secretary

tel.: 716-857-7548

stocktransfer@wellsfargo.com

(Stock Symbol: NFG)

silversteint@natfuel.com

timothy J. Silverstein

Change of address notices and

Annual Meeting

inquiries about dividends should

the annual Meeting of Stockholders

be sent to the transfer agent at

will be held at 9:30 a.m. (local time)

the address listed above.

on thursday, March 7, 2013,

National Fuel Direct Stock
Purchase and Dividend
Reinvestment Plan

at the ritz-Carlton, Naples,

280 Vanderbilt Beach road, Naples,

Fl 34108. Stockholders of record

National Fuel offers a simple, cost-

as of the close of business on

effective method for purchasing

January 7, 2013, will receive in the

shares of National Fuel stock. a

mail formal notice of the meeting,

prospectus, which includes details

proxy statement and proxy.

of the plan, can be obtained by

calling, writing or emailing Wells

National Fuel Gas Company

6363 Main Street

Director, Investor relations

tel.: 716-857-6987

Williamsville, NY 14221

National Fuel Gas Company

Independent Accountants

pricewaterhouseCoopers llp

3600 HSBC Center

Buffalo, NY 14203

6363 Main Street

Williamsville, NY 14221

This report is printed on paper containing
postconsumer fiber. The paper used in
this report is also certified under the
Forest Stewardship Council guidelines.

Back Cover: The Covington
area of the Company’s Marcellus
operations, which has been
fully developed with 47 natural
gas wells and a high-pressure
gathering system, demonstrates
the minimal long-term impact
to the surrounding environment.

At-A-Glance Footnotes:
(1) Consolidated operating revenue as set forth in the Company’s 2012 Statement of Income and Earnings reinvested in the Business was $1,626.9 million, including Exploration
& production, $558.2 million; pipeline & Storage, $259.3 million; utility, $719.1 million; Energy Marketing, $188.0 million; and Corporate and all other, ($97.7) million (including
$17.5 million for National Fuel Gas Midstream Corporation, $4.6 million in other revenue, and intersegment eliminations of ($119.8) million).

(2) Consolidated operating Income as set forth in the Company’s 2012 Statement of Income and Earnings reinvested in the Business was $448.0 million, including Exploration
& production, $203.3 million; pipeline & Storage, $120.4 million; utility, $117.2 million; Energy Marketing, $5.9 million; and Corporate and all other, $1.2 million (including
$13.1 million for National Fuel Gas Midstream Corporation).

(3) Consolidated Net Income as set forth in the Company’s 2012 Statement of Income and Earnings reinvested in the Business was $220.1 million, including Exploration
& production, $96.5 million; pipeline & Storage, $60.5 million; utility, $58.6 million; Energy Marketing, $4.2 million; and Corporate and all other, $0.3 million (including
$6.9 million for National Fuel Gas Midstream Corporation).

(4) National Fuel Gas Midstream Corporation’s capital expenditures are included in “Expenditures for additions to long-lived assets” in the “all other” column in the table for the

year ended September 30, 2012 on page 120 of the Company’s 2012 Form 10-K.

(5) Consolidated total assets as set forth in the Company’s 2012 Balance Sheet were $5.935 billion, including Exploration & production, $2.367 billion; pipeline & Storage,

$1.244 billion; utility, $2.070 billion; Energy Marketing, $62.0 million; and Corporate and all other, $191.4 million (including $116.8 million for National Fuel Gas
Midstream Corporation).

this Summary annual report contains “forward-looking statements” as defined by the private Securities litigation reform act of 1995. Forward-looking statements should be read
with the cautionary statements and important factors included in the Company’s Form 10-K at Item 7, MD&a, under the heading “Safe Harbor for Forward-looking Statements,”
and with the “risk Factors” included in the Company’s Form 10-K at Item 1a. Forward-looking statements are all statements other than statements of historical fact, including, without
limitation, statements regarding future prospects, plans, objectives, goals, projections, estimates of oil and gas quantities, strategies, future events or performance and underlying
assumptions, capital structure, anticipated capital expenditures, completion of construction and other projects, projections for pension and other post-retirement benefit obligations,
impacts of the adoption of new accounting rules, and possible outcomes of litigation or regulatory proceedings, as well as statements that are identified by the use of the words
“anticipates,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,” “may” and similar expressions.

Forward-looking statements include estimates of oil and gas quantities. proved oil and gas reserves are those quantities of oil and gas which, by analysis of geoscience and
engineering data, can be estimated with reasonable certainty to be economically producible under existing economic conditions, operating methods and government regulations.
other estimates of oil and gas quantities, including estimates of probable reserves, possible reserves, and resource potential, are by their nature more speculative than estimates of
proved reserves. accordingly, estimates other than proved reserves are subject to substantially greater risk of being actually realized.

this Summary annual report and the statements contained herein are submitted for the general information of stockholders and employees of the Company and are not intended to
induce any sale or purchase of securities or to be used in connection therewith. For up-to-date information, we have two sources for your use. You may call 1-800-334-2188 at any
time to receive National Fuel’s current stock price and trade volume or to hear the latest news releases. You may also have news releases faxed or mailed to you. National Fuel’s Web
site can be found at http://www.nationalfuelgas.com. You may sign up there to receive news releases automatically by e-mail. Simply go to the News section and subscribe.

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upsTream

midsTream

downsTream

invesTor inFormaTion

National Fuel Gas Company is
an integrated, diversified energy
company with four financial
reporting segments: Exploration and
Production, Pipeline and Storage,
Utility, and Energy Marketing.

PHOtO CAPtiONs
Upstream: Andrew Shepherd, an employee of Seneca Resources
Corporation, monitors a Marcellus Shale well completion in Lycoming
County, Pa.

Midstream: National Fuel Gas Supply Corporation’s Josh Corey
inspects new facilities being constructed at the Wales, N.Y.
Compressor Station.

Downstream: Cathy Martorana of National Fuel Gas Distribution
Corporation oversees customer operations in the New York
Consumer Response Center, ensuring excellent customer service.

ExPloration
& ProdUCtion

2 012 H iG H liG Hts:

Operating Revenues:
$558.2 million(1)

Operating income:
$203.3 million(2)

Net income:
$96.5 million

Capital Expenditures:
$693.8 million

total Assets:
$2.367 billion

total Annual Production:
83.4 Bcfe

• total natural gas and crude oil proved reserves increased 33%

from the prior year, reaching 1.246 tcfe at September 30, 2012.

• Seneca’s three-year average finding and development costs were

$1.87 per Mcfe, a decrease of 11% as compared to the prior
three-year period ended September 30, 2011.

• Crude oil production in Seneca’s West Division grew 8%

compared to the prior year.

• Marcellus Shale production increased 58% from the prior year,

reaching 55.8 Bcfe in 2012.

2 013 OutlO Ok:

• produce 95 to 107 Bcfe of natural gas and crude oil, representing
a 21% increase at the midpoint when compared to the prior year.

• Increase the focus on Seneca’s crude oil activities, spending

approximately $80 to $110 million on projects within its expanding
California operations, as well as its newly acquired acreage in the
Mississippian lime play in Kansas.

• Continue ongoing delineation efforts in the Marcellus and

utica shales across a broad section of Seneca’s pennsylvania
acreage position.

Index

Bcf Billion cubic feet (of natural gas)

Bcfe Bcf equivalent (of natural gas and crude oil)

Dth Dekatherm (Approx. 1 Mcf of natural gas)

Mcf Thousand cubic feet (of natural gas)

Mcfe Mcf equivalent (of natural gas and crude oil)

MMcf Million cubic feet (of natural gas)

Tcf Trillion cubic feet (of natural gas)

Tcfe Tcf equivalent (of natural gas and crude oil)

Note
Footnotes are located on the inside back cover of this report.

PiPElinE &
StoragE

2 012 H iG H liG Hts:

Operating Revenues:
$259.3 million(1)

Operating income:
$120.4 million(2)

Net income:
$60.5 million

Capital Expenditures:
$144.2 million

total Assets:
$1.244 billion

system throughput:
371.1 Bcf

• Commenced construction of the line N 2012 Expansion project,
which moves 163,000 Dth per day of Marcellus production, and
placed it fully in service November 2012.

2 013 OutlO Ok:

• Continue to aggressively pursue new projects, focusing primarily

on serving Marcellus and utica producers in pennsylvania and ohio.

• Maintain progress with ongoing efforts to upgrade transmission
pipeline and storage assets to ensure safe and reliable natural
gas delivery.

Utility

National Fuel Gas Distribution Corporation sells
or transports natural gas to customers through a
local distribution system located in western
New York and northwestern pennsylvania.

2 012 H iG H liG Hts:

Operating Revenues:
$719.1 million(1)

Operating income:
$117.2 million(2)

Net income:
$58.6 million

Capital Expenditures:
$58.3 million

total Assets:
$2.070 billion

system throughput:
125.1 Bcf

• More than 75% of capital expenditures are allocated to system

safety, maintenance and enhancements.

• assisted qualifying customers in receiving $51 million in HEap

and lIHEap funding in New York and pennsylvania.

• received regulatory approval to extend a successful energy

conservation program through 2015.

2 013 OutlO Ok:

• Continue to modernize the local distribution system and further

promote natural gas as the safe, reliable, clean and economic fuel
choice for homes, businesses and vehicles.

• address the current challenge of providing continuous natural

gas service to payment-troubled, low-income customers through
enhanced outreach and targeted assistance programs.

• Initiate a multi-year program to upgrade the Customer

Information System.

gatHEring &
ProCESSing

National Fuel Gas Midstream Corporation’s primary
business is to build, own and operate natural gas
processing and pipeline gathering facilities in the
appalachian region.

EnErgy
MarkEting

National Fuel resources, Inc. sells competitively
priced natural gas to industrial, wholesale,
commercial, public authority and residential
customers primarily in New York and pennsylvania.

20 12 H iG H liG Hts:

Operating Revenues:
$17.5 million(1)

Operating income:
$13.1 million(2)

Net income:
$6.9 million(3)

Capital Expenditures:
$80.0 million(4)

total Assets:
$116.8 million(5)

Gathering Volumes:
44.3 Bcf

2 013 OutlO Ok:

• Continue to add facilities to both the trout run and Covington

gathering systems to facilitate the transportation of additional volumes.

• Evaluate potential expansion opportunities for new projects to serve
both Seneca resources and third party producers in the Marcellus
and utica shales.

20 12 H iG H liG Hts:

Operating Revenues:
$188.0 million(1)

Operating income:
$5.9 million(2)

Net income:
$4.2 million

total Assets:
$62.0 million

total sales Volume:
45.8 Bcf

• Successfully expanded residential customer base

in pennsylvania.

2 013 Outl O Ok:

• Continue customer growth within current markets.

• Maintain high levels of customer satisfaction and retention.

• Implement new customer billing and accounting software

to support evolving needs of the business.

Common Stock Transfer
Agent and Registrar

Wells Fargo Shareowner Services

p.o. Box 64856

St. paul, MN 55164-0856

tel.: 800-648-8166

Website:

http://www.shareowneronline.com

Email:

Fargo Shareowner Services, the

Investor Relations

Additional Shareholder Reports

administrator of the plan, at the

Investors or financial analysts

additional copies of this report,

address listed above.

desiring information should contact:

the 2012 Form 10-K, and the 2012

Trustee for Debentures

the Bank of New York Mellon

101 Barclay Street, 8W

New York, NY 10286

Stock Exchange Listing

New York Stock Exchange

David p. Bauer

treasurer

tel.: 716-857-7318

timothy J. Silverstein

Director, Investor relations

tel.: 716-857-6987

Financial and Statistical report

can be obtained without charge

by writing to or calling:

paula M. Ciprich

Corporate Secretary

tel.: 716-857-7548

stocktransfer@wellsfargo.com

(Stock Symbol: NFG)

silversteint@natfuel.com

timothy J. Silverstein

Change of address notices and

Annual Meeting

inquiries about dividends should

the annual Meeting of Stockholders

be sent to the transfer agent at

will be held at 9:30 a.m. (local time)

the address listed above.

on thursday, March 7, 2013,

National Fuel Direct Stock
Purchase and Dividend
Reinvestment Plan

at the ritz-Carlton, Naples,

280 Vanderbilt Beach road, Naples,

Fl 34108. Stockholders of record

National Fuel offers a simple, cost-

as of the close of business on

effective method for purchasing

January 7, 2013, will receive in the

shares of National Fuel stock. a

mail formal notice of the meeting,

prospectus, which includes details

proxy statement and proxy.

of the plan, can be obtained by

calling, writing or emailing Wells

National Fuel Gas Company

6363 Main Street

Director, Investor relations

tel.: 716-857-6987

Williamsville, NY 14221

National Fuel Gas Company

Independent Accountants

pricewaterhouseCoopers llp

3600 HSBC Center

Buffalo, NY 14203

6363 Main Street

Williamsville, NY 14221

This report is printed on paper containing
postconsumer fiber. The paper used in
this report is also certified under the
Forest Stewardship Council guidelines.

(4) National Fuel Gas Midstream Corporation’s capital expenditures are included in “Expenditures for additions to long-lived assets” in the “all other” column in the table for the

year ended September 30, 2012 on page 120 of the Company’s 2012 Form 10-K.

(5) Consolidated total assets as set forth in the Company’s 2012 Balance Sheet were $5.935 billion, including Exploration & production, $2.367 billion; pipeline & Storage,

$1.244 billion; utility, $2.070 billion; Energy Marketing, $62.0 million; and Corporate and all other, $191.4 million (including $116.8 million for National Fuel Gas
Midstream Corporation).

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Fueled by TalenT driven by value

National Fuel Gas Company
6363 Main Street, Williamsville, New York 14221
716-857-7000 www.nationalfuelgas.com
NYSE: NFG

National Fuel Gas Company
SuM MarY aN N ual rE port 2012

Inside: At-A-Glance

Flexible by design

With a diverse portfolio of quality assets and wide-ranging
expertise in the oil and natural gas business, National Fuel
is flexible by design. Recognizing the best time to deploy or
preserve capital enables the Company to focus its investment
activities where, and when, the opportunities are greatest.
The result is enhanced shareholder value over the long run.

talented
employees

Quality
assets

Business
synergies

uPstream seneca

resources
corporation

83.4 bcfe

total production

In 2012, Seneca grew
production by 23% from
the prior year, driven
by an increase in both
Marcellus Shale natural
gas and California crude
oil production.

1.25 tcfe

proved reserves

Seneca surpassed
1 trillion cubic feet
equivalent of natural gas
and crude oil reserves as
of September 30, 2012.

The Exploration and Production
segment has a great collection
of natural resource assets.
With 775,000 net prospective
acres, the Marcellus Shale
remains the centerpiece
of Seneca’s future growth
plans. Seneca’s operations are
readily scalable, up or down,
because the company owns,
in fee, nearly 80 percent of its
natural gas rights. Responding
to the prolonged decline in
natural gas prices, in 2012
Seneca slowed the pace of its
Marcellus development plans.
This preserved the strength of
National Fuel’s balance sheet
and places the Company
in a position to capitalize on
economic opportunities as
they arise.

Seneca’s California operations
had a tremendous year, as
the company posted an
8 percent increase in crude

Seneca Resources’ operations in Lycoming County,
Pa., highlight the ability to drill multiple wells
from one surface location, a practice that furthers
the Company’s commitment to the environment.

oil production, even though
many of the area’s fields have
been active for more than a
century. Seneca’s employees
continue to find new ways to
optimize these mature fields
and economically extract
additional oil.

2012 also saw activities that
augur well for Seneca’s future.

The Company is furthering
its delineation efforts in the
Utica Shale, a promising play
that underlies much of the
Company’s Pennsylvania
acreage. In addition, Seneca
acquired properties in
Kansas and California that
will increase, and further
diversify, the Company’s oil
production footprint.

ProliFic results — lycoming county, Pa.
With its location in the heart of Pennsylvania, Lycoming County
will play an important role in Seneca’s plans during the next few
years. In 2012, Seneca commenced Marcellus production from
this region, seeing prolific results, with initial production rates
per well ranging from 10.5 to 16.1 million cubic feet per day.
These wells, on average, represent the most productive drilled
by Seneca since the commencement of its Marcellus program.
As a result, this area of more than 10,000 net acres will be the
centerpiece of Seneca’s development plans in 2013.

National Fuel Gas Company Summary Annual Report 2012Seneca Resources continues to distinguish
itself as an operator that can turn opportunities
into results in established and emerging plays
throughout Appalachia and in California.

Recent development
activity in the Sespe Field
in California helped drive
crude oil production
growth that delivers strong
cash flows to fund the
Company’s Appalachian
development.

midstream national Fuel g as supply corporation

empire pipeline, inc.
national Fuel g as midstream corporation

Positioned strategically
throughout Appalachia,
National Fuel’s gathering and
FERC-regulated interstate
pipeline network has been
rapidly expanding to meet
the needs of both natural
gas producers and utility
customers in the region. In
fact, 2012 was an inflection
point for these midstream
businesses. With three major
projects completed, including
Empire’s Tioga County
Extension Project, Supply’s
Line N Expansion Project
and NFG Midstream’s Trout
Run Gathering System, these
businesses invested more in

infrastructure during 2012
than any other year in National
Fuel’s history.

In addition to contributing
significantly to 2012 revenue,
these expansion projects are
the start of a reconfiguration
of the Company’s pipeline
network. As a result, new
pipeline paths were created
and additional Marcellus
gathering infrastructure
was constructed, creating
opportunities for shippers
to access key markets in the
northeast and Canada. The
new Tioga County Extension
Project has improved flexibility

for shippers, allowing them
to pursue the most economic
opportunities by creating
bi-directional transportation
routes along the system.

In Lycoming County, Pa., National
Fuel Gas Midstream Corporation’s
Trout Run Gathering System
underlying this right-of-way will
provide natural gas transportation for
future production from Seneca’s wells
being drilled by the pictured rig.

In 2013, the transformation
of National Fuel’s pipeline
network is expected to
continue. With two additional
projects, including a second
expansion to transport
additional volumes into
Canada, the Company
is positioned to play a
critical role in the ongoing
development of the Marcellus
and Utica shales.

National Fuel Gas Company Summary Annual Report 2012
Terry Kreuz and Mike Kasprzak of National Fuel Gas
Supply Corporation monitor construction progress on
the Northern Access Expansion Project that transports
natural gas to Canadian markets.

$375 million

new inFrastructure

During 2011 and 2012,
the Company spent
nearly $375 million to
expand and upgrade
its Appalachian
infrastructure, nearly a
350% increase over the
prior two-year period.

670 mmcf

daily export capacity

Two new projects have
been completed since
November 2011 that
allow for the capability
to export natural gas
to Canada.

With a long history of building and operating
natural gas pipelines in Appalachia, National
Fuel is strategically positioned to be a leader
in the midstream business for years to come.

Terry Falsone and Greg Maliken
are working on marketing plans for
projects designed to expand the
Company’s pipeline operations
within Appalachia.

downstream

national Fuel g as distriBution corporation
national Fuel resources, inc.

Employees of National
Fuel Resources, Inc., the
Company’s energy marketing
subsidiary, discuss natural
gas delivery plans to ensure
that the load demands of
all its various customers are
consistently met.

Despite the dual challenges
of a slow economic recovery
and a very warm winter, the
Utility contributed net income
of $58.6 million in 2012, only
7 percent lower than in 2011.
This achievement was made
possible by employees’ sharp
focus on cost control, which
yielded significant savings
across many business
operations. These measures,
however, were not undertaken

at the expense of pipeline
modernization and safety, for
which spending remained
largely unchanged. Likewise,
National Fuel’s attention to
excellent customer service
was undiminished as the
Utility, once again, exceeded
its customer service
performance targets, including
metrics imposed by regulators.

National Fuel Gas Company Summary Annual Report 2012 The Utility’s dedication to excellent customer service is
exemplified by its commitment to efficiently answer inquiries
using trained representatives. Having call centers in both
New York and Pennsylvania provides overflow support and
the flexibility to reroute calls in the event of a disruption.

Utility employee Todd Woods
demonstrates how to re-light
natural gas appliances in the
company’s new state-of-the-
art training facility.

Uncompromising safety, steadfast reliability and
excellent service have long been the mission
of National Fuel’s downstream retail operations.

On the energy marketing
side, National Fuel Resources
completed another year
of providing a value-driven
competitive alternative for
thousands of natural gas
customers in New York and
Pennsylvania. Like the Utility,
NFR’s earnings dipped
primarily because of the
throughput declines due to
the warmer weather, but
year-end results still met our
adjusted expectations.

Low commodity prices
continue to generate
significant savings for
customers served by the
Utility and NFR. Those savings
are providing new service
opportunities for the Utility,
as reflected in an increase in
applications for gas delivery
service and growing interest
in compressed natural gas
as a vehicle fuel alternative
to traditional motor fuels like
diesel or gasoline.

8.8 seconds

eFFicient customer service

On average, for the past 12 months,
customer service telephone calls to the Utility
call centers were answered in 8.8 seconds.

$27 million

customer assistance

In the first five years of the Conservation
Incentive Program, New York utility customers
have received more than $27 million in appliance
rebates and low-income housing weatherization.

saFety & stewardshiP

National Fuel places safety
and protection of the
environment at the forefront of
its operations. We continue to
build and sustain a company-
wide culture where safety and
environmental stewardship
are top priorities. Not only
does the Company observe
all federal, state and local
regulations in its operations, it
also goes beyond compliance
by embracing industry
best practices as a matter
of course.

As part of a federal pipeline
integrity program, the
Company’s utility and
interstate pipeline subsidiaries
successfully completed
the first 10-year cycle of
transmission pipeline integrity
assessments. This program
will systematically recur,
and to date, the Company
has inspected 694 miles
of its transmission pipeline.
Ensuring the operational

integrity of the distribution and
transmission pipeline networks
remains a critical component
of the Company’s capital
spending program, with
efforts focused on replacing
legacy pipelines, validating
maximum pipeline operating
pressures and continuing
modernization of the system.

Like all National Fuel
companies, Seneca
Resources regularly applies
best practices across its
operations. From the use of
third-party operational audits,
to the observance of a “Zero
Surface Water Discharge”
policy and the creation of
a Water Protection Team,
these successful programs
demonstrate Seneca’s
commitment to sound
environmental practices
in the communities where
it operates.

The dual goals of customer safety and
responsible environmental stewardship
are embedded in National Fuel’s internal
culture, driving innovation and promoting
the use of industry best practices.

Michael Argauer of the
Company’s Utility subsidiary
inspects a low-pressure
distribution line in Lackawanna,
N.Y., maintaining National Fuel’s
commitment to operating a safe
and reliable system.

National Fuel Gas Company Summary Annual Report 2012 The Utility continues to
upgrade its vintage steel and
cast iron infrastructure.

employee saFety

2012 was a remarkable
year for employee safety,
with the lowest OSHA
Recordable Injury Rates
ever registered by
National Fuel.

system modernization

Continuing its
commitment to safety,
the Utility retired or
replaced more than 6,100
of its bare steel service
lines in 2012.

caliFornia oPerator oF the year
In 2012, Seneca Resources Corporation was recognized as the
Bureau of Land Management’s 2012 California Operator of
the Year. It has taken several steps to reduce the operational risk
and improve the aesthetics of its activities in the topographically
challenging and environmentally sensitive areas of California’s
Sespe Oil Field, a mature field that has been producing for more
than a century. There, Seneca has removed excess materials,
reduced treating facilities from ten to two, and refinished all
surface equipment to minimize the visual impact of its operations.
This award reflects Seneca’s and National Fuel’s commitment to
safety and environmental best practices across all operations.

to our shareholders

After several years of rapid growth, the natural gas
industry experienced a slowdown in 2012 that tested
the strength and adaptability of many companies.

At National Fuel, we started the year with a robust plan to further develop our
Marcellus Shale acreage. With natural gas prices falling significantly, however,
and in furtherance of our strategy for growth over the long run, we examined
alternatives and adjusted our near-term plans by reducing Seneca Resources’
rig count and delaying some Marcellus completions. This enabled us to preserve
investment capital and focus on Seneca’s more economic opportunities in
California and in Lycoming County, Pa. We also redoubled our efforts to expand
the pipeline system within our midstream businesses. Because of these actions,
we maintained a healthy balance sheet and, quite unlike the asset-shedding
response forced upon some of our peers, we preserved our ability to act when
other investment opportunities arise. As a result, even though expectations were
tempered during the year, the Company is very well positioned for future growth
and solid, long-term performance.

It appears that for some, the industry is following its historic boom-bust pattern
of rapid expansion, followed by equally rapid contraction. National Fuel’s ability
to weather a low commodity price environment and preserve its future growth
opportunities was an exception to that rule, and not by accident. By design, this
Company boasts certain attributes that provide it with the flexibility to quickly
adapt to changing circumstances.

Seneca, for example, owns most of its Marcellus acreage in fee, which allows
the Company to scale development — down or up — in order to maximize
opportunities without compromising long-term shareholder interests. Practically
speaking, this means that we are not compelled by the requirements of limited-
term leases to maintain an aggressive drilling program when current economics
do not support it. In addition, the Company owns synergistically diverse assets,
allowing us to allocate capital into the business segments with the best potential
in response to changing market dynamics. And most importantly, our experienced
and knowledgeable employees recognize when and how to pursue the most
advantageous opportunities when it is valuable to our shareholders and beneficial
to our customers.

Ronald J. Tanski
President and Chief
Operating Officer

David F. Smith
Chairman of the
Board and Chief
Executive Officer

National Fuel Gas Company Summary Annual Report 2012

Even with the substantial change to its operational program, Seneca’s results
continue to be better than anticipated. In May, Seneca commenced production
from a new development area in Lycoming County, Pa., in conjunction with the
completion of our midstream pipeline subsidiary’s Trout Run Gathering System.
Seneca’s production from these wells is the best we have seen since the
Company commenced Marcellus development in 2009. In fact, the Lycoming
County wells helped to drive the Company’s total production increase to
23 percent, reaching 83.4 Bcfe, and will be the main driver behind the 20 percent
production growth we anticipate in 2013. As a result of this success, Seneca
eclipsed 1 trillion cubic feet equivalent (Tcfe) of natural gas and crude oil
proved reserves and ended the year with nearly 1.25 Tcfe. Furthermore, should
natural gas prices improve, the same flexibility that allows us to scale down
our development program would also enable us to readily scale it back up as
circumstances warrant.

While our efforts have been focused on the Marcellus Shale, in 2012, we
increased exploration activities in the deeper Utica Shale, a play that underlies
much of National Fuel’s Marcellus footprint. Seneca’s initial test results, along
with Utica data points from many other operators in the basin, show promise for
enhancing the value of our Appalachian acreage. We are also pleased with the
contribution of our oil operations to the Company’s performance. To maintain
that contribution, we completed two modest transactions in 2012. With those
acquisitions we expanded our California footprint and also have diversified
our asset base into an emerging basin in Kansas. Even though the impact
of these transactions in 2013 will be limited, they exemplify our employees’
industry expertise and our ability to deploy capital both in response to current
circumstances and in furtherance of our emphasis on creating long-term value.

RESERVE GROWTH
MILESTONE REACHED
Total Company Proved
Reserves (Bcfe)
at September 30

1,246

935

700

528

’09

’10

’11

’12

As expected, 2012 was an inflection point for our midstream businesses,
which saw the completion of several major initiatives to expand the Company’s
Marcellus-area pipeline infrastructure. In the
first quarter, two major expansion projects
were placed in service, each unique in its own
right. With its initial Line N Expansion Project,
Supply Corporation has established itself as
a critical provider of transportation capacity in
southwestern Pennsylvania, one of the most
actively developed areas in the Marcellus Shale
and Appalachia. Additionally, Empire Pipeline
placed the Tioga County Extension into
service. A first for Appalachian pipelines, the
Tioga County Extension provides the capability of exporting production into
Ontario, Canada, in addition to other markets for still-increasing Marcellus
Shale production.

We are pleased to report that
National Fuel’s remarkable record of
uninterrupted dividends continued in
2012 for its 110th year and 42nd year
of consecutive annual increases.

We remain focused on opportunities for continued expansion of pipeline assets
in the Marcellus and Utica shale production areas. Moving forward, we are actively
pursuing new projects with potential shippers to find ways to meet their needs

5-YEAR TOTAL SHAREHOLDER RETURNS
At September 30* (Assumes Dividend Reinvestment)

$150

$130

$110

$90

$70

NFG

SIG Oil E&P Index
PHLX Utility
Sector Index

S&P 500 Index

$50

’07

’08

’09

’10

’11

’12

*Assumes $100 invested on September 30, 2007 and reinvesting of dividends

and to provide the infrastructure required to move their natural gas to end-use
demand markets. Given our regional expertise, existing footprint, and ongoing
success in efficiently shepherding projects from the drawing board to active
service, we are confident that this business will
play a considerable role in driving the growth we
anticipate during the coming years.

The United States has never been
in a more advantageous position
to capture the long-term economic,
geopolitical and environmental
benefits that natural gas can deliver.

On the retail side, in 2012, our regulated Utility and
energy marketing subsidiary were confronted with
the twin challenges of a record-warm winter and
tepid economic conditions in the companies’ service
areas. Despite these difficulties, the companies
held their own and registered another year of solid
earnings. This would not have been possible without

our employees’ efforts to rein in costs and increase operational efficiencies.
We are very pleased with the results that those measures achieved, while
spending on safety and new infrastructure in the Utility segment was maintained
as a top priority.

Customers, of course, enjoyed another year of comparatively low bills and safe,
reliable service. Because of the continuing low prices, residential oil and propane
users are converting to natural gas utility service in increasing numbers. Industrial
users, including electric generation plants, are also considering natural gas as a
cleaner and more economical alternative to coal. As a vehicle fuel, natural gas’
significant price and emission advantage over diesel and gasoline is attracting
the interest of fleet owners, some of whom have already constructed new fueling
facilities in the Utility’s service territory. To capture these promising new customer
opportunities, the Utility has enhanced its marketing efforts and is working with
state regulators to create innovative rates and services designed to promote
increased usage of natural gas.

National Fuel Gas Company Summary Annual Report 2012

42 YEARS OF
DIVIDEND INCREASES
Annualized Dividend
Rate at Fiscal Year End

$1.42

$1.38

$1.46

$1.34

’09

’10

’11

’12

We are also pleased to report that National Fuel’s remarkable record of
uninterrupted dividends continued in 2012 for its 110th year and 42nd year of
consecutive annual increases. There are few companies that match this kind
of reliable, long-lasting performance, and rare indeed is the energy company that
can produce solid returns during prolonged commodity price declines.

This past year brought change to National Fuel’s Board of Directors. David
Carroll, President of the Gas Technology Institute, was elected to the Board
effective June 7, 2012. David is a highly respected and nationally known leader
with significant knowledge of the natural gas industry and the development
of technology solutions for transmission and distribution pipeline integrity,
unconventional gas production, and end-use applications. We believe that David’s
impressive breadth of industry experience is a reflection of this Company’s
commitment to maintaining a Board of Directors that is, by any measure, the best
in the business. In March, George Mazanec retired from the Board after 16 years
of distinguished service. With his invaluable guidance and deep understanding of
the business, George exemplified the high standards of expertise and professional
integrity that define the National Fuel Board. We wish him the best of luck in
his retirement.

The United States has never been in a more advantageous position to capture
the long-term economic, geopolitical and environmental benefits that natural
gas can deliver. And there are a multitude of benefits, from the obvious savings
to consumers as a result of lower natural gas prices, to less obvious savings in
electric rates and manufacturing costs. From an energy security perspective,
increased production of domestic natural gas is already credited with reducing
our dependence on foreign imports. There are environmental benefits too, as
home heating customers switch from oil to cleaner-burning natural gas, and
electric generation plants replace older, less efficient coal facilities with modern
natural gas-fired equipment. The industry recognizes its responsibility for the
protection of natural resources, and National Fuel in particular is a leader in its
use of environmentally sound production and operational technologies. The fact
is, natural gas production, transmission and distribution are industrial activities
that, like other industrial activities that power this nation, can be undertaken with
minimal negative impact on the environment. Responsible energy policy and,
perhaps more reliably, economic necessity, will ensure that the nation’s energy
needs are increasingly fueled by natural gas. We are excited that National Fuel
will continue to play an integral role during this transformative period.

Sincerely,

David F. Smith
Chairman of the Board and
Chief Executive Officer

January 7, 2013

Ronald J. Tanski
President and
Chief Operating Officer

PrinciPal oFFicers

directors

NatioNal Fuel Gas CompaNy
David F. Smith
Chairman and Chief
Executive Officer

Ronald J. Tanski
President and Chief
Operating Officer

Matthew D. Cabell
Senior Vice President

James D. Ramsdell
Senior Vice President

David P. Bauer
Treasurer and Principal
Financial Officer

Karen M. Camiolo
Controller and Principal
Accounting Officer

Paula M. Ciprich
General Counsel and
Secretary

Donna L. DeCarolis
Vice President Business
Development

Principal Officers of
Principal Subsidiaries

seNeCa ResouRCes
CoRpoRatioN
David F. Smith
Chairman

Matthew D. Cabell
President

Barry L. McMahan
Senior Vice President
and Secretary

John P. McGinnis
Senior Vice President

Cindy D. Wilkinson
Controller

NatioNal Fuel Gas
supply CoRpoRatioN
David F. Smith
Chairman

John R. Pustulka
President

David P. Bauer
Treasurer

James R. Peterson
Secretary and General
Counsel

Karen M. Camiolo
Controller

Ronald C. Kraemer
Vice President

empiRe p ipeliNe, iNC .
David F. Smith
Chairman

Ronald C. Kraemer
President

David P. Bauer
Treasurer

James R. Peterson
Secretary

Karen M. Camiolo
Controller

NatioNal Fuel Gas
DistRibutioN CoRpoRatioN
David F. Smith
Chairman

Anna Marie Cellino
President

Carl M. Carlotti
Senior Vice President

Paula M. Ciprich
Secretary

Karen M. Camiolo
Controller

Richard E. Klein
Treasurer

Bruce D. Heine
Vice President

Jay W. Lesch
Vice President

Steven Wagner
Vice President

Sarah J. Mugel
Vice President and
General Counsel

Ann M. Wegrzyn
Vice President

NatioNal Fuel ResouRCes, iNC.
Joseph N. Del Vecchio
Vice President

NatioNal Fuel Gas
miDstReam CoRpoRatioN
Duane A. Wassum
President

James R. Peterson
Secretary

Philip C. Ackerman 3,5^
Former Chairman of the
Board of Directors, Chief
Executive Officer and
President of the Company.
Director of Associated
Electric and Gas Insurance
Services Limited. Company
Director since 1994.

Robert T. Brady 2, 3, 4^
Executive Chairman and
Board member, former
Chief Executive Officer
and President of Moog
Inc. Director of Astronics
Corporation and M&T Bank
Corporation. Member of
the UB Council (State
University of New York at
Buffalo), member of the
Board of the Buffalo Niagara
Partnership and a member
of the Governor’s Regional
Economic Development
Council of Western New York.
Former director of Seneca
Foods Corporation. Company
Director since 1995.

David C. Carroll 4
President and Chief Executive
Officer of Gas Technology
Institute. Director of Versa
Power Systems, Inc. Member
of the Society of Gas Lighting
and the Executives’ Club of
Chicago. Chairman of the
Steering Committee for the
17th International Conference
and Exhibition on Liquified
Natural Gas in Houston
(2013) and will become
President of the International

Gas Union as the United
States prepares to host the
2018 World Gas Conference
in Washington, D.C. Company
Director since June 2012.

R. Don Cash 1,2^,4
Chairman Emeritus and
Board Director of Questar
Corporation. Former
Chairman, Chief Executive
Officer and President of
Questar Corporation. Director
of Zions Bancorporation,
Associated Electric and Gas
Insurance Services Limited
and the Ranching Heritage
Association. Former Director
of TODCO (The Offshore
Drilling Company). Company
Director since 2003.

Stephen E. Ewing 1,2,5
Former Vice Chairman of DTE
Energy. Former President and
Chief Operating Officer of
MCN Energy Group Inc. and
Former President and Chief
Executive Officer of Michigan
Consolidated Gas Company.
Director of CMS Energy.
Trustee and immediate past
Chairman of the Board of The
Skillman Foundation. Chairman
of the Auto Club of Michigan
and Vice Chairman of the
Board of the Auto Club Group
(AAA). Former Chairman of the
American Gas Association, the
National Petroleum Council,
the Midwest Gas Association
and the Natural Gas Vehicle
Coalition. Company Director
since 2007.

National Fuel Gas Company Summary Annual Report 2012
Rolland E. Kidder 1,4
Founder, former Chairman
and President of Kidder
Exploration, Inc., and former
Trustee of the New York Power
Authority. Former Director
of two Appalachian-based
energy associations: the
Independent Oil and Gas
Association of New York and
the Pennsylvania Natural Gas
Association. Former Executive
Director of the Robert H.
Jackson Center, Inc. Company
Director since 2002.

Craig G. Matthews 1^,3,5
Former President, Chief
Executive Officer and
Director of NUI Corporation.
Former Vice Chairman,
Chief Operating Officer
and Director of KeySpan
Corporation. Director of
Hess Corporation and
Board member of Republic
Financial Corporation.
Member and former Chairman
of the Board of Trustees of
Polytechnic Institute of New

York University, member of
the National Advisory Board
for the Salvation Army and
founding Chairman of the New
Jersey Salvation Army Board.
Company Director since
February 2005.

Richard G. Reiten 2,4
Former Chairman, Director,
Chief Executive Officer and
President of Northwest
Natural Gas Company.
Former President of Portland
General Electric Company and
Portland General Corporation.
Director of Associated Electric
and Gas Insurance Services
Limited. Former Chairman and
Director of the American Gas
Association, former Director
of Building Materials Holding
Corporation, former Director
of US Bancorp and former
Director of IDACORP Inc.
A Company Director since
2004, Mr. Reiten’s Board
service concludes at the 2013
Annual Meeting.

Frederic V. Salerno 2,4
Director of GGCP, Inc. Since
2006, Mr. Salerno has also
served as Senior Advisor
to New Mountain Capital,
L.L.C. Former Vice Chairman
and Chief Financial Officer
of Verizon Communications.
Trustee and former President
of the Inner City Scholarship
Fund and former Chairman
of the Board of Trustees
of the State University
of New York. Director of
Akamai Technologies, Inc.,
Intercontinental Exchange,
Inc., Viacom, Inc., and CBS
Corporation. Former Director
of Bear Stearns & Co., Inc.
and Consolidated Edison,
Inc., and former Chairman
of the Board of Orion Power
Holdings. Company Director
since 2008.

David F. Smith 3^,5
Chairman, Chief Executive
Officer and former President
of National Fuel Gas
Company. Board member of
the American Gas Association
(Executive Committee),
American Gas Foundation,
Gas Technology Institute
(Executive Committee), the
Business Council of New
York State (Chairman and
member of the Executive
Committee), the Buffalo
Niagara Enterprise (immediate
past Chairman and member of
the Executive Committee), the
State University of New York
at Buffalo Law School Dean’s
Advisory Council and The
Buffalo Sabres Foundation.
Company Director since 2007.

1 Member of Audit Committee

2 Member of Compensation Committee

3 Member of Executive Committee

4 Member of Nominating/Corporate

Governance Committee

5 Member of Financing Committee

^ Denotes Committee Chairman

george l. mazanec — 16 years as director
For sixteen years, George Mazanec’s contribution to the National Fuel Gas Company Board
of Directors has proven invaluable. With a formidable intellect and deep respect for the
highest ethical standards, George played a key role in guiding the Company through a period
of tremendous growth, where total assets increased from $2.1 billion in 1996 to $5.9 billion
today. George’s quality leadership, sound advice and tireless dedication exemplified the high
standards that define National Fuel’s Board.

Through the years we also enjoyed the privilege of George’s and his late wife Elsa’s friendship
and camaraderie. Although George’s service ended in March, he will long remain an important
member of the National Fuel family.

Financial and oPerating highlights

National Fuel Gas Company Year Ended September 30

2012

2011

2010

2009

2008

operating Revenues (Thousands)(1)

$ 1,626,853

$ 1,778,842

$ 1,760,503

$ 2,051,543

$ 2,396,837

Net income available for Common stock (Thousands)

220,077(2)

258,402(3)

225,913(4)

100,708(5)

268,728

Return on average Common equity (6)

11.4%

14.2%

13.5%

6.3%

16.6%

per Common share

Basic Earnings

Diluted Earnings

Dividends Paid

Dividend Rate at Year-End

Book Value at Year-End

2.65

2.63

1.43

1.46

23.52

3.13

3.09

1.39

1.42

22.85

2.78

2.73

1.35

1.38

21.27

1.26

1.25

1.31

1.34

19.74

3.27

3.18

1.26

1.30

20.27

Common shares outstanding at year-end

83,330,140

82,812,677

82,075,470

80,499,915

79,120,544

Weighted average Common shares outstanding

Basic

Diluted

83,127,844

82,514,015

81,380,434

79,649,965

82,304,335

83,739,771

83,670,802

82,660,598

80,628,685

84,474,839

average Common shares traded Daily

558,000

534,526

411,256

551,327

654,620

Common stock price

High

Low

64.19

41.57

54.04

75.98

48.67

48.68

54.42

42.83

51.81

48.30

26.67

45.81

63.71

38.04

42.18

Net Cash provided by operating activities (Thousands)

$ 660,787

$ 660,546

$ 447,032

$ 611,818

$ 482,776

total assets (Thousands)

$ 5,935,142

$ 5,221,084

$ 5,047,054

$ 4,769,129

$ 4,130,187

Capital expenditures
per statements of Cash Flows (Thousands)

Volume information

utility throughput – mmcf

Gas Sales

Gas Transportation

pipeline & storage throughput – mmcf

$ 1,036,784

$ 820,872

$ 443,101

$ 313,633

$ 397,734

64,099

61,027

73,857

66,273

68,760

60,105

69,414

59,751

73,470

64,267

Gas Transportation

371,139

319,954

301,366

352,182

358,370

production

Gas – MMcf

Oil – Mbbl

Total – MMcfe

proved Reserves

Gas – MMcf

Oil – Mbbl

Total – MMcfe

66,131

2,870

83,351

988,434

42,862

50,467

2,860

67,627

30,345

3,220

49,665

22,284

3,373

42,522

22,341

3,070

40,761

674,922

428,413

248,954

225,899

43,345

45,239

46,587

46,198

1,245,606

934,992

699,847

528,476

503,087

energy marketing Volume – mmcf

Gas

average Number of utility Retail Customers

average Number of utility transportation Customers

Number of employees at september 30

45,756

599,106

133,467

1,874

52,893

58,299

60,858

56,120

609,126

619,897

624,149

627,938

122,474

108,850

103,176

1,827

1,859

1,949

98,925

1,943

(1) Excludes discontinued operations.
(2) Includes elimination of other post-retirement regulatory liability of $12.8 million.
(3) Includes gain on sale of unconsolidated subsidiaries of $31.4 million.

(4) Includes gain on sale of Horizon LFG, Inc. of $6.3 million.
(5) Includes impairment of oil and gas producing properties of ($108.2) million.
(6) Calculated using average Total Comprehensive Shareholder Equity.

National Fuel Gas Company Summary Annual Report 2012

upsTream

midsTream

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invesTor inFormaTion

National Fuel Gas Company is
an integrated, diversified energy
company with four financial
reporting segments: Exploration and
Production, Pipeline and Storage,
Utility, and Energy Marketing.

PHOtO CAPtiONs
Upstream: Andrew Shepherd, an employee of Seneca Resources
Corporation, monitors a Marcellus Shale well completion in Lycoming
County, Pa.

Midstream: National Fuel Gas Supply Corporation’s Josh Corey
inspects new facilities being constructed at the Wales, N.Y.
Compressor Station.

Downstream: Cathy Martorana of National Fuel Gas Distribution
Corporation oversees customer operations in the New York
Consumer Response Center, ensuring excellent customer service.

ExPloration
& ProdUCtion

2 012 H iG H liG Hts:

Operating Revenues:
$558.2 million(1)

Operating income:
$203.3 million(2)

Net income:
$96.5 million

Capital Expenditures:
$693.8 million

total Assets:
$2.367 billion

total Annual Production:
83.4 Bcfe

• total natural gas and crude oil proved reserves increased 33%

from the prior year, reaching 1.246 tcfe at September 30, 2012.

• Seneca’s three-year average finding and development costs were

$1.87 per Mcfe, a decrease of 11% as compared to the prior
three-year period ended September 30, 2011.

• Crude oil production in Seneca’s West Division grew 8%

compared to the prior year.

• Marcellus Shale production increased 58% from the prior year,

reaching 55.8 Bcfe in 2012.

2 013 OutlO Ok:

• produce 95 to 107 Bcfe of natural gas and crude oil, representing
a 21% increase at the midpoint when compared to the prior year.

• Increase the focus on Seneca’s crude oil activities, spending

approximately $80 to $110 million on projects within its expanding
California operations, as well as its newly acquired acreage in the
Mississippian lime play in Kansas.

• Continue ongoing delineation efforts in the Marcellus and

utica shales across a broad section of Seneca’s pennsylvania
acreage position.

Index

Bcf Billion cubic feet (of natural gas)

Bcfe Bcf equivalent (of natural gas and crude oil)

Dth Dekatherm (Approx. 1 Mcf of natural gas)

Mcf Thousand cubic feet (of natural gas)

Mcfe Mcf equivalent (of natural gas and crude oil)

MMcf Million cubic feet (of natural gas)

Tcf Trillion cubic feet (of natural gas)

Tcfe Tcf equivalent (of natural gas and crude oil)

Note
Footnotes are located on the inside back cover of this report.

PiPElinE &
StoragE

2 012 H iG H liG Hts:

Operating Revenues:
$259.3 million(1)

Operating income:
$120.4 million(2)

Net income:
$60.5 million

Capital Expenditures:
$144.2 million

total Assets:
$1.244 billion

system throughput:
371.1 Bcf

• Commenced construction of the line N 2012 Expansion project,
which moves 163,000 Dth per day of Marcellus production, and
placed it fully in service November 2012.

2 013 OutlO Ok:

• Continue to aggressively pursue new projects, focusing primarily

on serving Marcellus and utica producers in pennsylvania and ohio.

• Maintain progress with ongoing efforts to upgrade transmission
pipeline and storage assets to ensure safe and reliable natural
gas delivery.

Utility

National Fuel Gas Distribution Corporation sells
or transports natural gas to customers through a
local distribution system located in western
New York and northwestern pennsylvania.

2 012 H iG H liG Hts:

Operating Revenues:
$719.1 million(1)

Operating income:
$117.2 million(2)

Net income:
$58.6 million

Capital Expenditures:
$58.3 million

total Assets:
$2.070 billion

system throughput:
125.1 Bcf

• More than 75% of capital expenditures are allocated to system

safety, maintenance and enhancements.

• assisted qualifying customers in receiving $51 million in HEap

and lIHEap funding in New York and pennsylvania.

• received regulatory approval to extend a successful energy

conservation program through 2015.

2 013 OutlO Ok:

• Continue to modernize the local distribution system and further

promote natural gas as the safe, reliable, clean and economic fuel
choice for homes, businesses and vehicles.

• address the current challenge of providing continuous natural

gas service to payment-troubled, low-income customers through
enhanced outreach and targeted assistance programs.

• Initiate a multi-year program to upgrade the Customer

Information System.

gatHEring &
ProCESSing

National Fuel Gas Midstream Corporation’s primary
business is to build, own and operate natural gas
processing and pipeline gathering facilities in the
appalachian region.

EnErgy
MarkEting

National Fuel resources, Inc. sells competitively
priced natural gas to industrial, wholesale,
commercial, public authority and residential
customers primarily in New York and pennsylvania.

20 12 H iG H liG Hts:

Operating Revenues:
$17.5 million(1)

Operating income:
$13.1 million(2)

Net income:
$6.9 million(3)

Capital Expenditures:
$80.0 million(4)

total Assets:
$116.8 million(5)

Gathering Volumes:
44.3 Bcf

2 013 OutlO Ok:

• Continue to add facilities to both the trout run and Covington

gathering systems to facilitate the transportation of additional volumes.

• Evaluate potential expansion opportunities for new projects to serve
both Seneca resources and third party producers in the Marcellus
and utica shales.

20 12 H iG H liG Hts:

Operating Revenues:
$188.0 million(1)

Operating income:
$5.9 million(2)

Net income:
$4.2 million

total Assets:
$62.0 million

total sales Volume:
45.8 Bcf

• Successfully expanded residential customer base

in pennsylvania.

2 013 Outl O Ok:

• Continue customer growth within current markets.

• Maintain high levels of customer satisfaction and retention.

• Implement new customer billing and accounting software

to support evolving needs of the business.

Common Stock Transfer
Agent and Registrar

Wells Fargo Shareowner Services

p.o. Box 64856

St. paul, MN 55164-0856

tel.: 800-648-8166

Website:

http://www.shareowneronline.com

Email:

Fargo Shareowner Services, the

Investor Relations

Additional Shareholder Reports

administrator of the plan, at the

Investors or financial analysts

additional copies of this report,

address listed above.

desiring information should contact:

the 2012 Form 10-K, and the 2012

Trustee for Debentures

the Bank of New York Mellon

101 Barclay Street, 8W

New York, NY 10286

Stock Exchange Listing

New York Stock Exchange

David p. Bauer

treasurer

tel.: 716-857-7318

timothy J. Silverstein

Director, Investor relations

tel.: 716-857-6987

Financial and Statistical report

can be obtained without charge

by writing to or calling:

paula M. Ciprich

Corporate Secretary

tel.: 716-857-7548

stocktransfer@wellsfargo.com

(Stock Symbol: NFG)

silversteint@natfuel.com

timothy J. Silverstein

Change of address notices and

Annual Meeting

inquiries about dividends should

the annual Meeting of Stockholders

be sent to the transfer agent at

will be held at 9:30 a.m. (local time)

the address listed above.

on thursday, March 7, 2013,

National Fuel Direct Stock
Purchase and Dividend
Reinvestment Plan

at the ritz-Carlton, Naples,

280 Vanderbilt Beach road, Naples,

Fl 34108. Stockholders of record

National Fuel offers a simple, cost-

as of the close of business on

effective method for purchasing

January 7, 2013, will receive in the

shares of National Fuel stock. a

mail formal notice of the meeting,

prospectus, which includes details

proxy statement and proxy.

of the plan, can be obtained by

calling, writing or emailing Wells

National Fuel Gas Company

6363 Main Street

Director, Investor relations

tel.: 716-857-6987

Williamsville, NY 14221

National Fuel Gas Company

Independent Accountants

pricewaterhouseCoopers llp

3600 HSBC Center

Buffalo, NY 14203

6363 Main Street

Williamsville, NY 14221

This report is printed on paper containing
postconsumer fiber. The paper used in
this report is also certified under the
Forest Stewardship Council guidelines.

(4) National Fuel Gas Midstream Corporation’s capital expenditures are included in “Expenditures for additions to long-lived assets” in the “all other” column in the table for the

year ended September 30, 2012 on page 120 of the Company’s 2012 Form 10-K.

(5) Consolidated total assets as set forth in the Company’s 2012 Balance Sheet were $5.935 billion, including Exploration & production, $2.367 billion; pipeline & Storage,

$1.244 billion; utility, $2.070 billion; Energy Marketing, $62.0 million; and Corporate and all other, $191.4 million (including $116.8 million for National Fuel Gas
Midstream Corporation).

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Fueled by TalenT driven by value

National Fuel Gas Company
6363 Main Street, Williamsville, New York 14221
716-857-7000 www.nationalfuelgas.com
NYSE: NFG

National Fuel Gas Company
SuM MarY aN N ual rE port 2012

Inside: At-A-Glance