##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2009
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to.
 Commission File Number 1-33571
 DOUBLE EAGLE PETROLEUM CO.
  MARYLAND
    
    83-0214692(State or other jurisdiction of
    
    (I.R.S. employerincorporation or organization)
    
    identification no.)1675 Broadway, Suite 2200, Denver, Colorado
    
    80202(Address of principal executive offices)
    
    (Zip code)
 303-794-8445
  None
  Yes þ No o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
(Do not check if a small reporting company)
    
    Small reporting Company o
 Yes o No þ
  Class
    
    Outstanding as of May 1, 2009Common stock, $.10 par value
    
    
    9,233,756




---



##### 



Page #PART I. Financial Information:Item 1. Financial StatementsConsolidated Balance Sheets as of March 31, 2009 (Unaudited)
and December 31, 2008
    
    
    2Consolidated Statements of Income for the Quarter
Ended March 31, 2009 and 2008 (Unaudited)
    
    
    3Consolidated Statements of Cash Flows for the Quarter
Ended March 31, 2009 and 2008 (Unaudited)
    
    
    4Notes to Consolidated Financial Statements (Unaudited)
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations
    
    
    14Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    22Item 4. Controls and Procedures
    
    
    22PART II. Other Information:Item 1. Legal Proceedings
    
    
    22Item 1A. Risk Factors
    
    
    22Item 6. Exhibits
    
    
    23Signatures
    
    
    25Exhibit 31.1Exhibit 31.2Exhibit 32
   1




---



##### Table of Contents



ITEM 1. FINANCIAL STATEMENTS
 DOUBLE EAGLE PETROLEUM CO.
 
 CONSOLIDATED BALANCE SHEETS
 (Amounts in thousands of dollars except share and per share data)
 March 31,
    
    
    December 31,2009
    
    
    2008(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    2,171
    
    
    $
    Cash held in escrow
    
    
    607
    
    
    
    605Accounts receivable
    
    
    9,432
    
    
    
    21,381Assets from price risk management
    
    
    11,167
    
    
    
    14,290Other current assets
    
    
    3,475
    
    
    
    3,513Total current assets
    
    
    26,852
    
    
    
    39,789Oil and gas properties and equipment, successful efforts method:Developed properties
    
    
    151,792
    
    
    
    133,516Wells in progress
    
    
    10,444
    
    
    
    18,518Gas transportation pipeline
    
    
    5,465
    
    
    
    5,465Undeveloped properties
    
    
    2,916
    
    
    
    2,907Corporate and other assets
    
    
    1,921
    
    
    
    1,920172,538
    
    
    
    162,326Less accumulated depreciation, depletion and amortization
    
    
    (39,635
    )
    
    
    (35,253
    )Net properties and equipment
    
    
    132,903
    
    
    
    127,073Assets from price risk management
    
    
    4,322
    
    
    
    5,029Other assets
    
    
    90
    
    
    
    98TOTAL ASSETS
    
    $
    164,167
    
    
    $
    171,989LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    7,776
    
    
    $
    35,488Accrued expenses
    
    
    7,382
    
    
    
    6,794Term loan
    
    
    3,750
    
    
    
    Accrued production taxes
    
    
    3,521
    
    
    
    3,017Capital lease obligations, current portion
    
    
    525
    
    
    
    522Other current liabilities
    
    
    307
    
    
    
    282Total current liabilities
    
    
    23,261
    
    
    
    46,103Line of credit
    
    
    38,750
    
    
    
    24,639Asset retirement obligation
    
    
    3,983
    
    
    
    4,208Liabilities from price risk management
    
    
    954
    
    
    
    Deferred tax liability
    
    
    3,101
    
    
    
    2,470Capital lease obligations, long-term portion
    
    
    946
    
    
    
    1,078Other long-term liabilities
    
    
    513
    
    
    
    616Total liabilities
    
    
    71,508
    
    
    
    79,114Preferred stock, $0.10 par value; 10,000,000 shares authorized;
1,610,000 shares issued and outstanding as of
March 31, 2009 and December 31, 2008
    
    
    37,972
    
    
    
    37,972Stockholders equity:Common stock, $0.10 par value; 50,000,000 shares authorized;
9,230,877 and 9,192,356 shares issued and outstanding as of
March 31, 2009 and December 31, 2008, respectively
    
    
    923
    
    
    
    919Additional paid-in capital
    
    
    35,544
    
    
    
    35,122Retained earnings
    
    
    2,248
    
    
    
    2,172Accumulated other comprehensive income
    
    
    15,972
    
    
    
    16,690Total stockholders equity
    
    
    54,687
    
    
    
    54,903TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    164,167
    
    
    $
    171,989
   2




---



##### Table of Contents



DOUBLE EAGLE PETROLEUM CO.
 
 CONSOLIDATED STATEMENTS OF INCOME
 (Amounts in thousands of dollars except share and per share data)
  Three months ended March 31,2009
    
    
    2008RevenuesOil and gas sales
    
    $
    10,500
    
    
    $
    6,251Transportation revenue
    
    
    1,587
    
    
    
    364Price risk management activities
    
    
    (1,140
    )
    
    
    652Other income, net
    
    
    93
    
    
    
    49Total revenues
    
    
    11,040
    
    
    
    7,316Costs and expensesProduction costs
    
    
    1,884
    
    
    
    1,021Production taxes
    
    
    889
    
    
    
    800Exploration expenses including dry hole costs
    
    
    26
    
    
    
    481Pipeline operating costs
    
    
    295
    
    
    
    83General and administrative
    
    
    1,674
    
    
    
    908Depreciation, depletion and amortization
    
    
    4,382
    
    
    
    1,014Total costs and expenses
    
    
    9,150
    
    
    
    4,307Income from operations
    
    
    1,890
    
    
    
    3,009Interest expense, net
    
    
    (252
    )
    
    
    (64
    )Income before income taxes
    
    
    1,638
    
    
    
    2,945Provision for deferred income taxes
    
    
    (631
    )
    
    
    (1,082
    )NET INCOME
    
    $
    1,007
    
    
    $
    1,863Preferred stock dividends
    
    
    931
    
    
    
    931Net Income attributable to common stock
    
    $
    76
    
    
    $
    932Net income per common share:Basic
    
    $
    0.01
    
    
    $
    0.10Diluted
    
    $
    0.01
    
    
    $
    0.10Weighted average shares outstanding:Basic
    
    
    9,201,913
    
    
    
    9,148,105Diluted
    
    
    9,201,913
    
    
    
    9,148,933
   3




---



##### Table of Contents



DOUBLE EAGLE PETROLEUM CO.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Amounts in thousands of dollars)
  Three months ended March 31,2009
    
    
    2008Cash flows from operating activities:Net income
    
    $
    1,007
    
    
    $
    1,863Adjustments to reconcile net income to net cash from
operating activities:Depreciation, depletion, amortization and accretion of asset retirement obligation
    
    
    4,406
    
    
    
    1,118Abandonment of non-producing properties
    
    
    5
    
    
    
    40Provision for deferred taxes
    
    
    631
    
    
    
    1,082Employee stock option expense
    
    
    430
    
    
    
    98Directors fees paid in stock
    
    
    38
    
    
    
    Change in fair value of derivative contracts
    
    
    4,066
    
    
    
    (652
    )Revenue from carried interest
    
    
    (563
    )
    
    
    Gain on sale of producing property
    
    
    (70
    )
    
    
    Changes in current assets and liabilities:Decrease (Increase) in deposit held in escrow
    
    
    (2
    )
    
    
    139Decrease (Increase) in accounts receivable
    
    
    11,949
    
    
    
    (2,147
    )Decrease (Increase) in other current assets
    
    
    38
    
    
    
    (7
    )Increase (Decrease) in accounts payable
    
    
    (12,242
    )
    
    
    1,290Decrease in accrued expenses
    
    
    (2,847
    )
    
    
    (767
    )Increase in accrued production taxes
    
    
    89
    
    
    
    406NET CASH PROVIDED BY OPERATING ACTIVITIES
    
    
    6,935
    
    
    
    2,463Cash flows from investing activities:Additions of producing properties and equipment, net
    
    
    (21,429
    )
    
    
    (10,801
    )Additions of corporate and non-producing properties
    
    
    (15
    )
    
    
    (202
    )Payment of acquisition related costs
    
    
    (102
    )
    
    
    NET CASH USED IN INVESTING ACTIVITIES
    
    
    (21,546
    )
    
    
    (11,003
    )Cash flows from financing activities:Principal payments on capital lease obligations
    
    
    (129
    )
    
    
    Issuance of stock under Company stock plans
    
    
    4
    
    
    
    Tax withholdings related to net share settlement of
restricted stock awards
    
    
    (23
    )
    
    
    Dividends on preferred stock
    
    
    (931
    )
    
    
    (931
    )Net borrowings (repayments) on line of credit
    
    
    17,861
    
    
    
    9,523NET CASH PROVIDED BY FINANCING ACTIVITIES
    
    
    16,782
    
    
    
    8,592Change in cash and cash equivalents
    
    
    2,171
    
    
    
    52Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    125CASH AND CASH EQUIVALENTS AT END OF PERIOD
    
    $
    2,171
    
    
    $
    177Supplemental disclosure of cash and non-cash transactions:Cash paid for interest
    
    $
    643
    
    
    $
    67Interest capitalized
    
    $
    300
    
    
    $
    106Rebill to joint interest partners for well costs
associated with unitization of Catalina
    
    $
    
    
    
    $
    11,426Additions to developed properties included in current liabilities
    
    $
    8,758
    
    
    $
    3,900Share-based compensation expense
    
    $
    468
    
    
    $
    98
   4




---



##### Table of Contents



DOUBLE EAGLE PETROLEUM CO.
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 (Amounts in thousands of dollars except share and per share data)
  1.
    
    Summary of Significant Accounting Policies
 Basis of presentation
     Recently adopted accounting pronouncements
      5




---



##### Table of Contents



New accounting pronouncements
 The Hierarchy
of Generally Accepted Accounting Principles
  Determining Fair Value when the Volume and Level of Activity for the Asset or
Liability have Significantly Decreased and Identifying Transactions that are not Orderly
 Interim Disclosures about Fair Value
of Financial Instruments Disclosures about Fair Value of Financial Instruments
 2.
    
    Earnings per share
   6




---



##### Table of Contents



For the Quarter Ended March 31,2009
    
    
    2008Net income
    
    $
    1,007
    
    
    $
    1,863Preferred stock dividends
    
    
    931
    
    
    
    931Income attributable to common stock
    
    $
    76
    
    
    $
    932Weighted average shares:Weighted average shares  basic
    
    
    9,201,913
    
    
    
    9,148,105Dilution effect of stock options
outstanding at the end of period
    
    
    
    
    
    
    828Weighted average shares  diluted
    
    
    9,201,913
    
    
    
    9,148,933Earnings per common share:Basic
    
    $
    0.01
    
    
    $
    0.10Diluted
    
    $
    0.01
    
    
    $
    0.10
  For the Quarter Ended March 31,2009
    
    
    2008Anti-dilutive shares
    
    
    90,809
    
    
    
    10,902
 3.
    
    Derivative Instruments
      Cash flow hedges
   7




---



##### Table of Contents



Mark to market hedging instruments
   Contract Settlement Date2009
    
    
    2010
    
    
    2011Natural Gas forward purchase contracts:Dollar value
    
    $
    20,594
    
    
    $
    18,834
    
    
    $
    20,644Average rate
    
    $
    6.96
    
    
    $
    4.30
    
    
    $
    7.07Volume (MMcf)
    
    
    2,961
    
    
    
    4,380
    
    
    
    2,920
  Derivatives designated as hedginginstruments under SFAS 133
    
    Balance Sheet Location
    
    
    Fair ValueAssetsCommodity derivatives
    
    Assets from price risk management  current
    
    $
    11,649Assets from price risk management  long term
    
    
    4,322Total
    
    
    
    
    
    $
    15,971
 Derivatives not designated ashedging instruments under SFAS 133
    
    Balance Sheet Location
    
    
    Fair ValueLiabilitiesCommodity derivatives
    
    Assets from price risk management  current
    
    $
    (482
    )Liabilities from price risk management  long term
    
    
    (954
    )Total
    
    
    
    
    
    $
    (1,436
    )
  Location of Gain
    
    
    
    
    
    Location of GainDerivatives Designated
    
    
    
    
    
    Reclassified from
    
    Amount of Gain
    
    
    Recognized in Incomeas Cash Flow
    
    Amount of Gain
    
    
    Accumulated OCI
    
    Reclassified from
    
    
    (Ineffective Portion andHedging Instruments
    
    Recognized in
    
    
    into Income
    
    Accumulated OCI
    
    
    Amount Excluded fromunder SFAS 133
    
    OCI on Derivative
    
    
    (effective portion)
    
    into Income
    
    
    Effectiveness testing)Commodity contracts
    
    $
    15,972
    
    
    Oil and gas sales
    
    $
    4,147
    
    
    
    N/A
  8




---



##### Table of Contents



Derivatives notDesignated as
    
    Location of Loss
    
    Amount of LossHedging Instruments
    
    Recognized in Income
    
    Recognized inunder SFAS 133
    
    on Derivative
    
    Income on DerivativeCommodity contracts
    
    Price risk management activities
    
    $
    (1,140
    )
 Normal purchases and normal sales
  4.
    
    Fair Value of Financial Instruments
  
    
    Level 1  Quoted prices (unadjusted) for identical assets or liabilities in active
markets.
    
    Level 2  Quoted prices for similar assets or liabilities in active markets; quoted
prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations
whose inputs or significant value drivers are observable.
    
    Level 3  Unobservable inputs that reflect the Companys own assumptions.
  Derivative instruments
   Asset retirement obligations
   9




---



##### Table of Contents



Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    TotalAssetsDerivative instruments
    
    $
    
    
    
    $
    15,489
    
    
    $
    
    
    
    $
    15,489Total assets at fair value
    
    $
    
    
    
    $
    15,489
    
    
    $
    
    
    
    $
    15,489LiabilitiesDerivative instruments
    
    $
    
    
    
    $
    954
    
    
    $
    
    
    
    $
    954Asset retirment obligation
    
    $
    
    
    
    $
    
    
    
    
    3,983
    
    
    $
    3,983Total liabilities at fair value
    
    $
    
    
    
    $
    954
    
    
    $
    3,983
    
    
    $
    4,937
  December 31, 2008 asset retirement obligation
    
    $
    4,208Liabilities incurred
    
    
    7Liabilities settled
    
    
    (256
    )Accretion expense
    
    
    24March 31, 2009 asset retirement obligation
    
    $
    3,983
  5.
    
    Impairment of Long-Lived Assets
  6.
    
    Stock-based Compensation
    10




---



##### Table of Contents



Weighted-AverageWeighted-
    
    
    RemainingAverage
    
    
    Contractual
    
    
    AggregateExercise
    
    
    Term
    
    
    IntrinsicShares
    
    
    Price
    
    
    (in years)
    
    
    ValueOptions:Outstanding at January 1, 2009
    
    
    626,897
    
    
    $
    15.68
    
    
    
    5.1Granted
    
    
    50,500
    
    
    $
    7.79Exercised
    
    
    Cancelled/expired
    
    
    (14,000
    )
    
    $
    14.10Outstanding at March 31, 2009
    
    
    663,397
    
    
    $
    15.11
    
    
    
    5.1
    
    
    $
    Exerciseable at March 31, 2009
    
    
    188,679
    
    
    $
    16.26
    
    
    
    3.4
    
    
    $
    
   Weighted-AverageGrant DateShares
    
    
    Fair ValueStock Awards:Outstanding at January 1, 2009
    
    
    94,762
    
    
    $
    14.70Granted
    
    
    37,572
    
    
    $
    3.48Vested
    
    
    (41,527
    )
    
    $
    4.44Forfeited/returned
    
    
    
    
    
    $
    Nonvested at March 31, 2009
    
    
    90,807
    
    
    $
    14.75
 7.
    
    Income TaxesAt March 31, 2009, the Company had a net operating loss carry forward for income tax
reporting purposes of approximately $30.3 million that will begin to expire in 2021. Although
Double Eagle is required to record income tax expense for financial reporting purposes, the
Company does not anticipate any payments of current tax liabilities in the near future.
  8.
    
    Credit Facility
   11




---



##### Table of Contents



9.
    
    Series A Cumulative Preferred Stock
   Redemption Date on or Before
    
    Redemption PriceJune 30, 2009
    
    $
    25.75June 30, 2010
    
    $
    25.50June 30, 2011
    
    $
    25.25June 30, 2012 or thereafter
    
    $
    25.00
  10.
    
    Comprehensive Income (Loss)
  For the Quarter Ended March 31,2009
    
    
    2008Net income attributable to common stock
    
    $
    76
    
    
    $
    1,863Change in derivative instrument
fair value, net of tax benefit of $0
    
    
    (4,865
    )
    
    
    (4,025
    )Reclassification to earnings
    
    
    4,147
    
    
    
    545Comprehensive loss
    
    $
    (642
    )
    
    $
    (1,617
    )
  12




---



##### Table of Contents



March 31,
    
    
    December 31,2009
    
    
    2008Net change in derivative instrument fair
value, net
of tax benefit of $0 and $0
    
    $
    15,972
    
    
    $
    16,690Total accumulated other comprehensive gain, net
    
    $
    15,972
    
    
    $
    16,690
  11.
    
    Cash Held in Escrow
  12.
    
    Intercompany TransactionsThe Company sold transportation assets located in the Catalina Unit, at cost, to Eastern
Washakie Midstream, LLC (EWM), a wholly-owned subsidiary, in exchange for an intercompany note
receivable bearing interest of 5% per annum, maturing on January 31, 2028. The note and related
interest are fully eliminated in consolidation.
  13.
    
    Proposed Merger
   14.
    
    Contingencies
 Litigation
 Double Eagle Petroleum Co.; Antelope Energy Company LLC; E. Cecile Martin f/k/a Cecile Hurt;
Hurt Properties, L.P.; James R. Hurt; John D. Traut, LLC; and Newfield Exploration Company vs.
Burlington Resources Oil & Gas Company, LP, a division of ConocoPhillips Company; ConocoPhillips
Company, a Delaware corporation.
  13




---



##### Table of Contents



ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
  FORWARD-LOOKING STATEMENTS
 This Quarterly Report on Form 10-Q includes forward-looking statements as defined by the
Securities and Exchange Commission, or SEC. We make these forward-looking statements in reliance
on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995.
All statements, other than statements of historical facts, included in this Form 10-Q that address
activities, events or developments that we expect, believe or anticipate will or may occur in the
future are forward-looking statements. These forward-looking statements are based on assumptions
which we believe are reasonable based on current expectations and projections about future events
and industry conditions and trends affecting our business. However, whether actual results and
developments will conform to our expectations and predictions is subject to a number of risks and
uncertainties that, among other things, could cause actual results to differ materially from those
contained in the forward-looking statements, including without limitation the Risk Factors set
forth in our Annual Report on Form 10-K for the year ended December 31, 2008, including the
following:
 
    
    The changing political environment in which we operate
 
    
    Our ability to continue to develop our Atlantic Rim project;
 
    
    Our ability to obtain, or a decline in, oil or gas production, or a decline in oil or
gas prices;
 
    
    Our ability to maintain adequate liquidity;
 
    
    Incorrect estimates of required capital expenditures;
 
    
    Increases in the cost of drilling, completion and gas collection or other costs of
production and operations;
 
    
    Our ability to increase our natural gas and oil reserves;
 
    
    The amount and timing of capital deployment in new investment opportunities;
 
    
    The volumes of production from our oil and gas development properties, which may be
dependent upon issuance by federal, state, and tribal governments, or agencies thereof, of
drilling, environmental and other permits, and the availability of specialized
contractors, work force, and equipment;
 
    
    Our future capital requirements and availability of capital resources to fund capital
expenditures;
 
    
    Our ability to successfully integrate and profitably operate any future acquisitions;
 
    
    The possibility that we may be required to take impairment charges to reduce the
carrying value of some of our long-lived assets when indicators of impairment emerge;
 
    
    Numerous uncertainties inherent in estimating quantities of proved oil and gas reserves
and actual future production rates and associated costs;
 
    
    Our ability to remedy any deficiencies that may be identified in the review of our
internal controls;
 
    
    The credit worthiness of third parties with which we enter into business agreements
with;
 
    
    General economic conditions, including the current financial crisis, tax rates or
policies and inflation rates;
 
    
    Changes in or compliance with laws and regulations, particularly those relating to
taxation, safety and protection of the environment;
 
    
    Weather and other natural phenomena;
 
    
    Industry and market changes, including the impact of consolidations and changes in
competition;
 
    
    The effect of accounting policies issued periodically by accounting standard-setting
bodies;
 
    
    The actions of third-party co-owners of interests in properties in which we also own an
interest;
 
    
    The cost and effects on our business, including insurance, resulting from terrorist
actions or natural disasters and responses to such actions or events;
 
    
    The volatility of our stock price; and
 
    
    The outcome of any future litigation or similar disputes and the impact on any such
outcome or related settlements.
  14




---



##### Table of Contents



Business Overview and Strategy
 www.dble.us
  (Amounts in thousands of dollars, except amounts per unit of production):
 
    
    Average Daily Production
  Atlantic Rim .
  15




---



##### Table of Contents



Pinedale Anticline
 Madden Deep Unit
 
    
    Oil and Gas Sales
  
    
    Cash Flow from Operations
  OVERVIEW OF FINANCIAL CONDITION AND LIQUIDITY
 Liquidity and Capital Resources
   March 31,
    
    
    December 31,2009
    
    
    2008Financial Position SummaryCash and cash equivalents
    
    $
    2,171
    
    
    $
    Working capital
    
    $
    3,591
    
    
    $
    (6,314
    )Balance outstanding on credit facility
    
    $
    42,500
    
    
    $
    24,639Stockholders equity
    
    $
    54,687
    
    
    $
    54,903RatiosDebt to total capital ratio
    
    
    31.4
    %
    
    
    21.0
    %Total debt to equity ratio
    
    
    77.7
    %
    
    
    44.9
    %
   16




---



##### Table of Contents



Cash flow activities
  Quarter ended March 31,2009
    
    
    2008Cash provided by (used in):Operating Activities
    
    $
    6,935
    
    
    $
    2,463Investing Activities
    
    
    (21,546
    )
    
    
    (11,003
    )Financing Activities
    
    
    16,782
    
    
    
    8,592Net change in cash
    
    $
    2,171
    
    
    $
    52
    Off-Balance Sheet Arrangements
   Line of Credit
   17




---



##### Table of Contents



Capital Requirements
  Contractual Obligations
  Payments due by periodOne year
    
    
    2  3
    
    
    4  5
    
    
    More thanTotal
    
    
    or less
    
    
    Years
    
    
    Years
    
    
    5 YearsCredit facility (a)
    
    $
    42,500
    
    
    $
    3,750
    
    
    $
    38,750
    
    
    $
    
    
    
    $
    Interest on line of credit (b)
    
    
    3,209
    
    
    
    2,421
    
    
    
    788
    
    
    
    
    
    
    
    Capital lease commitments
    
    
    2,070
    
    
    
    753
    
    
    
    1,317
    
    
    
    
    
    
    
    Operating lease commitments
    
    
    7,029
    
    
    
    1,557
    
    
    
    3,138
    
    
    
    2,334
    
    
    
    Total contractual cash
commitments
    
    $
    54,808
    
    
    $
    8,481
    
    
    $
    43,993
    
    
    $
    2,334
    
    
    $
    
 (a)
    
    The amount listed reflects the balance outstanding as of March 31, 2009. Any balance
outstanding on our revolving line of credit at July 31, 2010, will be due at that time.(b)
    
    Assumes the interest rate on our credit facility is consistent with that of March 31,
2009.  18




---



##### Table of Contents



RESULTS OF OPERATIONS
 Quarter ended March 31, 2009 compared to the quarter ended March 31, 2008
 Oil and gas sales volume and price comparisons
 Quarter Ended March 31,
    
    
    Percent
    
    
    Percent2009
    
    
    2008
    
    
    Volume
    
    
    PriceVolume
    
    
    Average Price
    
    
    Volume
    
    
    Average Price
    
    
    Change
    
    
    ChangeProduct:Gas (Mcf)
    
    
    2,234,415
    
    
    $
    5.90
    
    
    
    865,988
    
    
    $
    6.69
    
    
    
    158
    %
    
    
    -12
    %Oil (Bbls)
    
    
    7,696
    
    
    $
    30.68
    
    
    
    5,464
    
    
    $
    83.34
    
    
    
    41
    %
    
    
    -63
    %Mcfe
    
    
    2,280,591
    
    
    $
    5.89
    
    
    
    898,772
    
    
    $
    6.96
    
    
    
    154
    %
    
    
    -15
    %
       Transportation and gathering revenue
  Price risk management activities
   19




---



##### Table of Contents



Oil and gas production expenses, depreciation, depletion and amortization
 Quarter Ended March 31,2009
    
    
    2008(in dollars per mcfe)Average price
    
    $
    5.89
    
    
    $
    6.96Production costs
    
    
    0.83
    
    
    
    1.14Production taxes
    
    
    0.39
    
    
    
    0.89Depletion and amortization
    
    
    1.88
    
    
    
    1.03Total operating costs
    
    
    3.10
    
    
    
    3.06Gross margin
    
    $
    2.79
    
    
    $
    3.90Gross margin percentage
    
    
    47
    %
    
    
    56
    %
   Pipeline operating costs
  General and administrative
  Income taxes
   20




---



##### Table of Contents



CONTRACTED VOLUMES
   FORWARD SALES CONTRACTS
 RemainingContractual
    
    
    DailyProperty
    
    Volume
    
    
    Production
    
    
    Term
    
    
    PriceCatalina
    
    
    61,000
    
    
    
    1,000
    
    
    
    06/07-05/09
    
    
    $
    5.4791,000
    
    
    
    1,000
    
    
    
    07/07-06/09
    
    
    $
    5.84182,000
    
    
    
    2,000
    
    
    
    07/07-06/09
    
    
    $
    5.69214,000
    
    
    
    1,000
    
    
    
    11/07-10/09
    
    
    $
    5.66Atlantic Rim
    
    
    122,000
    
    
    
    1,000
    
    
    
    08/07-07/09
    
    
    $
    6.15Pinedale Anticline
    
    
    91,000
    
    
    
    1,000
    
    
    
    07/07-06/09
    
    
    $
    6.41Company Total
    
    
    761,000
  RemainingContractual
    
    
    DailyType of Contract
    
    Volume
    
    
    Production
    
    
    Term
    
    
    PriceFixed Price Swap
    
    
    2,200,000
    
    
    
    8,000
    
    
    
    1/09-12/09
    
    
    $
    7.34Fixed Price Swap
    
    
    4,380,000
    
    
    
    12,000
    
    
    
    1/10-12/10
    
    
    $
    4.30Fixed Price Swap
    
    
    2,920,000
    
    
    
    8,000
    
    
    
    1/11-12/11
    
    
    $
    7.07Total
    
    
    9,500,000
  CRITICAL ACCOUNTING POLICIES AND ESTIMATES
   21




---



##### Table of Contents



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Commodity Price Risks
   Interest Rate Risks
  
 ITEM 4. CONTROLS AND PROCEDURES
   
  
 ITEM 1. LEGAL PROCEEDINGS
  
 ITEM 1A. RISK FACTORS
   22




---



##### Table of Contents



ITEM 6. EXHIBITS
  Exhibit
    
    Description2.1
    
    
    Agreement and Plan of Merger dated March 30, 2009 by and among Double Eagle
Petroleum Co., DBLE Acquisition Corporation, and Petrosearch Energy Corporation and Form of
Voting Agreement (incorporated by reference from Exhibit 2.1 and 2.2 of the Companys
Current Report of Form 8-K dated March 31, 2009).3.1
    (a)
    
    Articles of Incorporation filed with the Maryland Secretary of State on
January 23, 2001 (incorporated by reference from Exhibit 3.1(a) of the Companys Annual
Report on Form 10-KSB for the year ended August 31, 2001).3.1
    (b)
    
    Certificate of Correction filed with the Maryland Secretary of State on
February 15, 2001 concerning the Articles of Incorporation (incorporated by reference from
Exhibit 3.1(b) of the Companys Annual Report on Form 10-KSB for the year ended August 31,
2001).3.1
    (c)
    
    Articles of Merger filed with the Maryland Secretary of State on February 15,
2001 (incorporated by reference from Exhibit 3.1(c) of the Companys Annual Report on Form
10-KSB for the year ended August 31, 2001).3.1
    (d)
    
    Certificate of Correction filed with the Maryland Secretary of State
(incorporated by reference from Exhibit 3 of the Companys Quarterly Report on Form 10-QSB
for the quarter ended November 30, 2001).3.1
    (e)
    
    Certificate of Correction to the Articles of Incorporation, filed with the
Maryland Department of Assessments and Taxation on June 1, 2007 (incorporated by reference
from Exhibit 3.3 of the Companys Current Report of Form 8-K dated June 29, 2007).3.1
    (f)
    
    Articles of Amendment, filed with the Maryland Department of Assessments and
Taxation on June 26, 2007 (incorporated by reference from Exhibit 3.1 of the companys
Current report on Form 8-K dated June 29, 2007).3.1
    (g)
    
    Articles Supplementary, filed with the Maryland Department of Assessments and
Taxation on June 29, 2007 (incorporated by reference from Exhibit 3.2 of the Companys
Current report of Form 8-K dated June 29, 2007).3.1
    (h)
    
    Articles Supplementary of Junior Participating Preferred Stock, Series B,
dated as of August 21, 2007 (incorporated by reference from Exhibit 3.1 of the Companys
Current report of Form 8-K dated August 28, 2007).3.2
    (a)
    
    Bylaws of the Company (incorporated by reference from Exhibit 3.2 of the
Companys Annual Report on Form 10-KSB, filed for the year ended August 31, 2001).3.2
    (b)
    
    Bylaws of the Company, as amended and restated on March 14, 2007
(incorporated by reference from Exhibit 3.2 of the Companys Current report on Form 8-K,
filed on March 14, 2007).3.2
    (c)
    
    Second Amendment and Restated Bylaws of the Company (incorporated by
reference from Exhibit 3.2 of the Companys Current report on Form 8-K dated June 11,
2007).4.1
    (a)
    
    Form of Warrant Agreement concerning Common Stock Purchase Warrants
(incorporated by reference from Exhibit 4.3 of the Amendment No. 1 to the Companys
Registration Statement on Form SB-2 filed on November 27, 1996, SEC Registration No.
333-14011).4.1
    (b)
    
    Shareholder Rights Agreement, dated as of August 24, 2007 (incorporated
herein by reference to the Companys Current report on Form 8-A filed on August 24,
2007).
  23




---



##### Table of Contents



Exhibit
    
    Description4.1
    (c)
    
    Articles Supplementary, filed with the Maryland Department of Assessments and
Taxation on June 29, 2007 (incorporated by reference from Exhibit 3.2 of the Companys
Current report on Form 8-K dated June 29, 2007).4.1
    (d)
    
    Articles Supplementary of Junior Participating Preferred Stock, Series B,
dated as of August 21, 2007 (incorporated by reference from Exhibit 3.1 of the Companys
Current report of Form 8-K dated August 28, 2007).10.1
    
    
    Credit Agreement dated February 26, 2009 between Double Eagle Petroleum Co. and
Bank of Oklahoma, N.A. et.al; Promissory Term Note dated February 26, 2009 between Double
Eagle Petroleum Co. and Bank of Oklahoma N.A.; and Revolving Notes dated February 26, 2009
between Double Eagle Petroleum Co. and Bank of Oklahoma, N.A. et.al; (incorporated by
reference from Exhibit 10.1, 10.2, and 10.3 of the Companys Current report of Form 8-K
dated March 3, 2009).31.1
    
    
    Certification of Chief Executive Officer (Principal Executive Officer) pursuant to Rule 13a 
14(a) and Rule 15a 14(a) of the Securities Exchange Act, as amended.31.2
    
    
    Certification of Chief Financial Officer (Principal Accounting Officer) pursuant to Rule 13a
 14(a) and Rule 15a  14(a) of the Securities Exchange Act, as amended.32
    
    
    Certification of Chief Executive Officer (Principal Executive Officer) and Chief Financial
Officer (Principal Accounting Officer) pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes  Oxley Act of 2002.
  24




---



##### Table of Contents



SIGNATURES
  DOUBLE EAGLE PETROLEUM CO.
(Registrant)Date:  May 7, 2009
    By:
    /s/   Richard D. DoleRichard D. DoleChief Executive Officer
(Principal Executive Officer)Date:  May 7, 2009
    By:
    /s/   Kurtis S. HooleyKurtis S. HooleyChief Financial Officer
(Principal Accounting Officer)  25




---



##### Table of Contents



Exhibit Number
    
    Description2.1
    
    
    Agreement and Plan of Merger dated March 30, 2009 by and
among Double Eagle Petroleum Co., DBLE Acquisition
Corporation, and Petrosearch Energy Corporation and Form of
Voting Agreement (incorporated by reference from Exhibit
2.1 and 2.2 of the Companys Current Report of Form 8-K
dated March 31, 2009).3.1
    (a)
    
    Articles of Incorporation filed with the Maryland Secretary
of State on January 23, 2001 (incorporated by reference
from Exhibit 3.1(a) of the Companys Annual Report on Form
10-KSB for the year ended August 31, 2001).3.1
    (b)
    
    Certificate of Correction filed with the Maryland Secretary
of State on February 15, 2001 concerning the Articles of
Incorporation (incorporated by reference from Exhibit
3.1(b) of the Companys Annual Report on Form 10-KSB for
the year ended August 31, 2001).3.1
    (c)
    
    Articles of Merger filed with the Maryland Secretary of
State on February 15, 2001 (incorporated by reference from
Exhibit 3.1(c) of the Companys Annual Report on Form
10-KSB for the year ended August 31, 2001).3.1
    (d)
    
    Certificate of Correction filed with the Maryland Secretary
of State (incorporated by reference from Exhibit 3 of the
Companys Quarterly Report on Form 10-QSB for the quarter
ended November 30, 2001).3.1
    (e)
    
    Certificate of Correction to the Articles of Incorporation,
filed with the Maryland Department of Assessments and
Taxation on June 1, 2007 (incorporated by reference from
Exhibit 3.3 of the Companys Current Report of Form 8-K
dated June 29, 2007).3.1
    (f)
    
    Articles of Amendment, filed with the Maryland Department
of Assessments and Taxation on June 26, 2007 (incorporated
by reference from Exhibit 3.1 of the companys Current
report on Form 8-K dated June 29, 2007).3.1
    (g)
    
    Articles Supplementary, filed with the Maryland Department
of Assessments and Taxation on June 29, 2007 (incorporated
by reference from Exhibit 3.2 of the Companys Current
report of Form 8-K dated June 29, 2007).3.1
    (h)
    
    Articles Supplementary of Junior Participating Preferred
Stock, Series B, dated as of August 21, 2007 (incorporated
by reference from Exhibit 3.1 of the Companys Current
report of Form 8-K dated August 28, 2007).3.2
    (a)
    
    Bylaws of the Company (incorporated by reference from
Exhibit 3.2 of the Companys Annual Report on Form 10-KSB,
filed for the year ended August 31, 2001).3.2
    (b)
    
    Bylaws of the Company, as amended and restated on March 14,
2007 (incorporated by reference from Exhibit 3.2 of the
Companys Current report on Form 8-K, filed on March 14,
2007).3.2
    (c)
    
    Second Amendment and Restated Bylaws of the Company
(incorporated by reference from Exhibit 3.2 of the
Companys Current report on Form 8-K dated June 11, 2007).
  26




---



##### Table of Contents



Exhibit Number
    
    Description4.1
    (a)
    
    Form of Warrant Agreement concerning Common Stock Purchase
Warrants (incorporated by reference from Exhibit 4.3 of the
Amendment No. 1 to the Companys Registration Statement on
Form SB-2 filed on November 27, 1996, SEC Registration No.
333-14011).4.1
    (b)
    
    Shareholder Rights Agreement, dated as of August 24, 2007
(incorporated herein by reference to the Companys Current
report on Form 8-A filed on August 24, 2007)4.1
    (c)
    
    Articles Supplementary, filed with the Maryland Department
of Assessments and Taxation on June 29, 2007 (incorporated
by reference from Exhibit 3.2 of the Companys Current
report on Form 8-K dated June 29, 2007).4.1
    (d)
    
    Articles Supplementary of Junior Participating Preferred
Stock, Series B, dated as of August 21, 2007 (incorporated
by reference from Exhibit 3.1 of the Companys Current
report of Form 8-K dated August 28, 2007).10.1
    
    
    Credit Agreement dated February 26, 2009 between Double
Eagle Petroleum Co. and Bank of Oklahoma, N.A. et.al;
Promissory Term Note dated February 26, 2009 between Double
Eagle Petroleum Co. and Bank of Oklahoma N.A.; and
Revolving Notes dated February 26, 2009 between Double
Eagle Petroleum Co. and Bank of Oklahoma, N.A. et.al;
(incorporated by reference from Exhibit 10.1, 10.2, and
10.3 of the Companys Current report of Form 8-K dated
March 3, 2009).31.1
    
    
    Certification of Chief Executive Officer (Principal
Executive Officer) pursuant to Rule 13a  14(a) and
Rule 15a  14(a) of the Securities Exchange Act, as
amended.31.2
    
    
    Certification of Chief Financial Officer (Principal
Accounting Officer) pursuant to Rule 13a  14(a) and
Rule 15a  14(a) of the Securities Exchange Act, as
amended.32
    
    
    Certification of Chief Executive Officer (Principal
Executive Officer) and Chief Financial Officer (Principal
Accounting Officer) pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes  Oxley Act
of 2002.
  27