##### Table of Contents



UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For The Quarter Ended September 30, 2005
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES 
EXCHANGE ACT OF 1934
 Commission File No. 001-32494
 BOIS dARC ENERGY, INC.
  NEVADA
(State or other jurisdiction of
incorporation or organization)
    
    76-0560383
(I.R.S. Employer
Identification Number)
 600 Travis Street, Suite 5200, Houston, Texas 77002
 (713) 228-0438
  þ o
  o þ
  o þ




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BOIS dARC ENERGY, INC.
 QUARTERLY REPORT
 For The Quarter Ended September 30, 2005
 INDEX
 PagePART I. Financial Information
    
    
    3Item 1. Financial Statements (Unaudited):
    
    
    3Consolidated Balance Sheets as of September 30, 2005 and December 31, 2004
    
    
    4Consolidated
Statements of Operations for the Three and Nine Months Ended
September 30, 2005, Consolidated Statement of Operations for the
period from Inception (July 16, 2004) to September 30, 2004 and
Combined Statement of Operations for the period from January 1, 2004 to July 15, 2004
    
    
    5Consolidated Statement of Change in Equity for the Nine Months ended September 30, 2005
    
    
    6Consolidated Statements of Cash Flows for the Three and Nine Months Ended September 30,
2005, Consolidated Statement of Cash Flows for the Period from
Inception (July 16, 2004) to September 30, 2004 and
Combined Statement of Cash Flows for the Period from January 1, 2004 to July 15, 2004
    
    
    7Notes to Consolidated and Combined Financial Statements
    
    
    8Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    17Item 3. Quantitative and Qualitative Disclosure About Market Risks
    
    
    24Item 4. Controls and Procedures
    
    
    25PART II. Other Information
    
    
    26Item 6. Exhibits
    
    
    26Section 302 Certification of the CEOSection 302 Certification of the CFOCertification of the CEO Pursuant to Section 906Certification of the CFO Pursuant to Section 906Certification of the CEO Pursuant to Section 302Certification of the CFO Pursuant to Section 302Certification of the CEO Pursuant to Section 906Certification of CFO Pursuant to Section 906
  2




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PART I  FINANCIAL INFORMATION
 
 ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
 INTRODUCTORY NOTE
   3




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BOIS dARC ENERGY, INC.
 
 CONSOLIDATED BALANCE SHEETS
 Unaudited
 September 30,
    
    
    December 31,2005
    
    
    2004(In thousands)Cash
    
    $
    3,058
    
    
    $
    2,416Accounts Receivable:Oil and gas sales
    
    
    10,798
    
    
    
    9,140Joint interest operations
    
    
    7,562
    
    
    
    5,558Prepaid Expenses
    
    
    7,613
    
    
    
    1,476Total current assets
    
    
    29,031
    
    
    
    18,590Property and Equipment:Proved properties
    
    
    271,006
    
    
    
    291,227Unevaluated properties
    
    
    11,174
    
    
    
    8,566Wells and related equipment and facilities
    
    
    587,231
    
    
    
    444,403Accumulated depreciation, depletion and amortization
    
    
    (265,504
    )
    
    
    (233,243
    )Net oil and gas properties
    
    
    603,907
    
    
    
    510,953Other
Property and Equipment, net of accumulated depreciation of $799
and$1,436 as of September 30, 2005 and December 31, 2004, respectively
    
    
    1,327
    
    
    
    524Other Assets
    
    
    884
    
    
    
    516$
    635,149
    
    
    $
    530,583LIABILITIES AND STOCKHOLDERS EQUITYAccounts Payable
    
    $
    35,723
    
    
    $
    20,103Accrued Expenses
    
    
    19,095
    
    
    
    14,676Total current liabilities
    
    
    54,818
    
    
    
    34,779Long-Term Debt
    
    
    24,000
    
    
    
    Payable to Comstock Resources
    
    
    
    
    
    
    148,066Deferred Income Taxes
    
    
    117,892
    
    
    
    Reserve for Future Abandonment Costs
    
    
    31,140
    
    
    
    28,253Total liabilities
    
    
    227,850
    
    
    
    211,098Stockholders and Members Equity:Class A Units, 10,000 units outstanding at December 31, 2004
    
    
    
    
    
    
    10Class B Units, 50,000,000 units outstanding at December 31, 2004
    
    
    
    
    
    
    304,227Common stock, $0.01 par, 64,155,000 outstanding at September 30, 2005
    
    
    642
    
    
    
    Additional paid-in capital
    
    
    453,519
    
    
    
    Retained earnings (deficit)
    
    
    (46,862
    )
    
    
    15,248Total stockholders equity
    
    
    407,299
    
    
    
    319,485$
    635,149
    
    
    $
    530,583
  4




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##### Table of Contents



BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
 
 CONSOLIDATED STATEMENT OF OPERATIONS
 For the Three Months and Nine Months Ended September 30, 2005
and the period from Inception (July 16, 2004) to September 30, 2004
COMBINED STATEMENT OF OPERATIONS
For the Period from January 1, 2004 to July 15, 2004
Unaudited
 CombinedBois dArcBois dArc
    
    
    Bois dArc
    
    
    Bois dArc
    
    
    Bois dArc
    
    
    Energy, LLCEnergy, Inc.
    
    
    Energy, LLC
    
    
    Energy, Inc.
    
    
    Energy, LLC
    
    
    PredecessorsPeriod fromThree Months
    
    
    Period from
    
    
    Nine Months
    
    
    Period from
    
    
    January 1,Ended
    
    
    Inception to
    
    
    Ended
    
    
    Inception to
    
    
    2004 toSeptember 30,
    
    
    September 30,
    
    
    September 30,
    
    
    September 30,
    
    
    July 15,2005
    
    
    2004
    
    
    2005
    
    
    2004
    
    
    2004Oil and gas sales
    
    $
    43,434
    
    
    $
    37,358
    
    
    $
    135,595
    
    
    $
    37,358
    
    
    $
    70,341Operating expenses:Oil and gas operating
    
    
    8,344
    
    
    
    7,293
    
    
    
    24,324
    
    
    
    7,293
    
    
    
    15,233Exploration
    
    
    2,826
    
    
    
    6,660
    
    
    
    10,516
    
    
    
    6,660
    
    
    
    2,676Depreciation, depletion and
amortization
    
    
    9,295
    
    
    
    12,217
    
    
    
    33,901
    
    
    
    12,217
    
    
    
    22,831General and administrative
    
    
    1,882
    
    
    
    795
    
    
    
    6,269
    
    
    
    795
    
    
    
    1,450Total operating expenses
    
    
    22,347
    
    
    
    26,965
    
    
    
    75,010
    
    
    
    26,965
    
    
    
    42,190Income from
operations
    
    
    21,087
    
    
    
    10,393
    
    
    
    60,585
    
    
    
    10,393
    
    
    
    28,151Other income (expenses):Interest income
    
    
    78
    
    
    
    22
    
    
    
    173
    
    
    
    22
    
    
    
    75Interest expense
    
    
    (337
    )
    
    
    (1,139
    )
    
    
    (3,086
    )
    
    
    (1,139
    )
    
    
    (4,453
    )Formation costs
    
    
    
    
    
    
    (1,641
    )
    
    
    
    
    
    
    (1,641
    )
    
    
    Loss on sale of property
    
    
    
    
    
    
    
    
    
    
    (89
    )
    
    
    
    
    
    
    Total other expenses
    
    
    (259
    )
    
    
    (2,758
    )
    
    
    (3,002
    )
    
    
    (2,758
    )
    
    
    (4,378
    )Income before income taxes
    
    
    20,828
    
    
    
    7,635
    
    
    
    57,583
    
    
    
    7,635
    
    
    
    23,773Provision for income taxes
    
    
    (7,559
    )
    
    
    
    
    
    
    (119,693
    )
    
    
    
    
    
    
    Net income
    
    $
    13,269
    
    
    $
    7,635
    
    
    $
    (62,110
    )
    
    $
    7,635
    
    
    $
    23,773Income (loss) per share:Basic
    
    $
    0.21
    
    
    
    
    
    
    $
    (1.10
    )Diluted
    
    $
    0.21
    
    
    
    
    
    
    $
    (1.10
    )Weighted average common and
common stock equivalent
shares outstanding:Basic
    
    
    62,429
    
    
    
    
    
    
    
    56,386Diluted
    
    
    64,213
    
    
    
    
    
    
    
    56,386Pro forma computation related to
conversion to a corporation for
income tax purposes:Income before income taxes
    
    $
    20,828
    
    
    $
    7,635
    
    
    $
    57,583
    
    
    $
    7,635
    
    
    $
    23,773Pro forma provision for
income taxes
    
    
    (7,559
    )
    
    
    (2,854
    )
    
    
    (20,875
    )
    
    
    (2,854
    )
    
    
    (8,321
    )Pro forma net income
    
    $
    13,269
    
    
    $
    4,781
    
    
    $
    36,708
    
    
    $
    4,781
    
    
    $
    15,452Pro forma earnings per
share:Basic
    
    $
    0.21
    
    
    
    
    
    
    $
    0.65Diluted
    
    $
    0.21
    
    
    
    
    
    
    $
    0.63Weighted average common
and common stock
equivalent shares
outstanding:Basic
    
    
    62,429
    
    
    
    
    
    
    
    56,386Diluted
    
    
    64,213
    
    
    
    
    
    
    
    58,103
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BOIS dARC ENERGY, INC.
 
 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
 For the Nine Months Ended September 30, 2005
Unaudited  (In thousands)
 Additional
    
    
    RetainedClass A
    
    
    Class B
    
    
    Common
    
    
    Paid in
    
    
    EarningsUnits
    
    
    Units
    
    
    Stock
    
    
    Capital
    
    
    (Deficit)
    
    
    TotalBalance at January 1, 2005
    
    $
    10
    
    
    $
    304,227
    
    
    $
    
    
    
    $
    
    
    
    $
    15,248
    
    
    $
    319,485Conversion from LLC to a
corporation
    
    
    (10
    )
    
    
    (304,227
    )
    
    
    500
    
    
    
    303,727
    
    
    
    
    
    
    
    (10
    )Public offering of common stock
    
    
    
    
    
    
    
    
    
    
    120
    
    
    
    144,960
    
    
    
    
    
    
    
    145,080Stock issuance costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,818
    )
    
    
    
    
    
    
    (1,818
    )Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    22
    
    
    
    6,650
    
    
    
    
    
    
    
    6,672Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (62,110
    )
    
    
    (62,110
    )Balance at September 30, 2005
    
    $
    
    
    
    $
    
    
    
    $
    642
    
    
    $
    453,519
    
    
    $
    (46,862
    )
    
    $
    407,299
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BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
 
 CONSOLIDATED STATEMENT OF CASH FLOWS
 For the Nine Months Ended September 30, 2005
Period from Inception (July 16, 2004) to September 30, 2004
COMBINED STATEMENT OF CASH FLOWS
Period from January 1, 2004 to July 15, 2004
Unaudited  (In thousands)
 CombinedBois dArcBois dArc
    
    
    Bois dArc
    
    
    Energy, LLCEnergy, Inc.
    
    
    Energy, LLC
    
    
    PredecessorsPeriod fromNine Months
    
    
    Period from
    
    
    January 1,Ended
    
    
    Inception to
    
    
    2004 toSeptember 30,
    
    
    September 30,
    
    
    July 15,2005
    
    
    2004
    
    
    2004CASH FLOWS FROM OPERATING ACTIVITIES:Net income (loss)
    
    $
    (62,110
    )
    
    $
    7,635
    
    
    $
    23,773Adjustments to reconcile net income (loss) to net cash provided by
operating activities:Deferred income taxes
    
    
    117,892
    
    
    
    
    
    
    
    Dry holes and lease impairments
    
    
    
    
    
    
    6,660
    
    
    
    1,527Depreciation, depletion and amortization
    
    
    33,901
    
    
    
    12,217
    
    
    
    22,831Stock based compensation
    
    
    4,165
    
    
    
    515
    
    
    
    Amortization of loan costs
    
    
    61
    
    
    
    
    
    
    
    Loss on sale of property
    
    
    89
    
    
    
    
    
    
    
    (Increase) decrease in accounts receivable
    
    
    (3,662
    )
    
    
    4,503
    
    
    
    (8,659
    )Increase in prepaid expenses
    
    
    (6,137
    )
    
    
    
    
    
    
    (199
    )Increase (decrease) in accounts payable and accrued expenses
    
    
    22,545
    
    
    
    (8,092
    )
    
    
    11,715Net cash provided by operating activities
    
    
    106,744
    
    
    
    23,438
    
    
    
    50,988CASH FLOWS FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    (125,077
    )
    
    
    (20,222
    )
    
    
    (83,273
    )Formation of Bois dArc Energy, net of cash distributed
    
    
    
    
    
    
    (24,054
    )
    
    
    Proceeds from sale of assets
    
    
    160
    
    
    
    
    
    
    
    Net cash used for investing activities
    
    
    (124,917
    )
    
    
    (44,276
    )
    
    
    (83,273
    )CASH FLOWS FROM FINANCING ACTIVITIES:Borrowings from Comstock Resources
    
    
    16,000
    
    
    
    67,979
    
    
    
    31,649Repayments to Comstock Resources
    
    
    (164,066
    )
    
    
    (28,175
    )
    
    
    Borrowings under bank credit facility
    
    
    24,000
    
    
    
    
    
    
    
    Redemption of Class A units
    
    
    
    
    
    
    10
    
    
    
    Principal payments on bank loan
    
    
    (10
    )
    
    
    
    
    
    
    (1,944
    )Proceeds from issuance of common stock
    
    
    145,080
    
    
    
    
    
    
    
    Stock and debt issuance costs
    
    
    (2,189
    )
    
    
    
    
    
    
    Cash distributions to equity owners
    
    
    
    
    
    
    398
    
    
    
    (946
    )Net cash provided by financing activities
    
    
    18,815
    
    
    
    40,212
    
    
    
    28,759Net increase (decrease) in cash and cash equivalents
    
    
    642
    
    
    
    19,374
    
    
    
    (3,526
    )Cash and cash equivalents at beginning of period
    
    
    2,416
    
    
    
    
    
    
    
    22,019Cash and cash equivalents at end of period
    
    $
    3,058
    
    
    $
    19,374
    
    
    $
    18,493
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BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
 
 NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
 (1) Organization
    8




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##### Table of Contents



BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS  (continued)
 Bois dArc Energy:
 Contributed toBois dArcEnergy, LLC(In thousands)Cash
    
    $
    17,030Other current assets
    
    
    21,992Property and equipment, net
    
    
    482,697Total assets
    
    $
    521,719Current liabilities and bank loan
    
    $
    (66,788
    )Payable to parent company
    
    
    (83,177
    )Reserve for future abandonment
    
    
    (26,443
    )Total liabilities
    
    
    (176,408
    )Net assets
    
    
    345,311Cash distributed
    
    
    (41,084
    )Net contribution
    
    $
    304,227
 (2) Summary of Significant Accounting Policies
  Basis of Presentation
  9




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BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS  (continued)
     Principles of Consolidation
  Use of Estimates in the Preparation of Financial Statements
  Concentration of Credit Risk and Accounts Receivable
  10




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BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS  (continued)
 Fair Value of Financial Instruments
  Property and Equipment
   Revenue Recognition and Gas Balancing
  11




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BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS  (continued)
 General and Administrative Expense
   Stock-based Compensation
  Income Taxes
   CombinedBois dArc
    
    
    Bois dArc
    
    
    Bois dArc
    
    
    Bois dArc
    
    
    Bois dArcEnergy,
    
    
    Energy,
    
    
    Energy,
    
    
    Energy,
    
    
    Energy, LLCInc.
    
    
    LLC
    
    
    Inc.
    
    
    LLC
    
    
    PredecessorsThree Months
    
    
    Period from
    
    
    Nine Months
    
    
    Period from
    
    
    Period fromEnded
    
    
    Inception to
    
    
    Ended
    
    
    Inception to
    
    
    January 1,September 30,
    
    
    September 30,
    
    
    September 30,
    
    
    September 30,
    
    
    2004 to2005
    
    
    2004
    
    
    2005
    
    
    2004
    
    
    July 15, 2004Current
    
    $
    621
    
    
    $
    
    
    
    $
    1,801
    
    
    $
    
    
    
    $
    Deferred
    
    
    6,938
    
    
    
    
    
    
    
    117,892
    
    
    
    
    
    
    
    Provision for income
taxes
    
    $
    7,559
    
    
    $
    
    
    
    $
    119,693
    
    
    $
    
    
    
    $
    
 12




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BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS  (continued)
 Pro Forma Income Tax Information
   CombinedBois dArc
    
    
    Bois dArc
    
    
    Bois dArc
    
    
    Bois dArc
    
    
    Bois dArcEnergy,
    
    
    Energy,
    
    
    Energy,
    
    
    Energy,
    
    
    Energy, LLCInc.
    
    
    LLC
    
    
    Inc.
    
    
    LLC
    
    
    PredecessorsPeriod fromThree Months
    
    
    Period from
    
    
    Nine Months
    
    
    Period from
    
    
    January 1,Ended
    
    
    Inception to
    
    
    Ended
    
    
    Inception to
    
    
    2004 toSeptember 30,
    
    
    September 30,
    
    
    September 30,
    
    
    September 30,
    
    
    July 15,2005
    
    
    2004
    
    
    2005
    
    
    2004
    
    
    2004Income before income
taxes
    
    $
    20,828
    
    
    $
    7,635
    
    
    $
    57,583
    
    
    $
    7,635
    
    
    $
    23,773Effective pro forma
income tax
rate
    
    
    36
    %
    
    
    37
    %
    
    
    36
    %
    
    
    37
    %
    
    
    35
    %Pro forma income tax
expense
    
    $
    7,559
    
    
    $
    2,854
    
    
    $
    20,875
    
    
    $
    2,854
    
    
    $
    8,321
 Earnings Per Share
  Three Months Ended September 30, 2005Income
    
    
    Shares
    
    
    Per Share(In thousands, except per share amounts)Basic Earnings Per Share:Net Income
    
    $
    13,269
    
    
    
    62,429
    
    
    $
    0.21Diluted Earnings Per Share:Net Income
    
    $
    13,269
    
    
    
    62,429Effect of Dilutive Securities:Stock Grants and Options
    
    
    
    
    
    
    1,784Net Income Available to Common Stockholders
With Assumed Conversions
    
    $
    13,269
    
    
    
    64,213
    
    
    $
    0.21
 Nine Months Ended September 30, 2005Income
    
    
    Shares
    
    
    Per Share(In thousands, except per share amounts)Basic Earnings Per Share:Net Loss
    
    $
    (62,110
    )
    
    
    56,386
    
    
    $
    (1.10
    )Diluted Earnings Per Share:Net Loss
    
    $
    (62,110
    )
    
    
    56,386Effect of Dilutive Securities:Stock Grants and Options
    
    
    
    
    
    
    
    (1)Net Loss Available to Common Stockholders
With Assumed Conversions
    
    $
    (62,110
    )
    
    
    56,386
    
    
    $
    (1.10
    )
 
 (1)
    
    For the nine months ended September 30, 2005 the effect of stock grants and options would have
been anti-dilutive to the net loss. Statements of Cash Flows
  Asset Retirement Obligations
  13




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##### Table of Contents



BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS  (continued)
  CombinedBois dArcBois dArc
    
    
    Bois dArc
    
    
    Energy, LLCEnergy, Inc.
    
    
    Energy, LLC
    
    
    PredecessorsNine Months
    
    
    
    
    
    
    Period fromEnded
    
    
    Period from
    
    
    January 1,September
    
    
    Inception to
    
    
    2004 to30, 2005
    
    

September 30, 2004
    
    
    July 15, 2004($ in thousands)Future abandonment
liability at
beginning of period
    
    $
    28,253
    
    
    $
    
    
    
    $
    24,876Contributed on
July 16, 2004
    
    
    
    
    
    
    26,443
    
    
    
    Accretion expense
    
    
    1,396
    
    
    
    421
    
    
    
    Liabilities assumed and new
wells drilled
    
    
    1,913
    
    
    
    250
    
    
    
    1,567Liabilities settled
    
    
    (422
    )
    
    
    (591
    )
    
    
    Future abandonment
liability at
end of period
    
    $
    31,140
    
    
    $
    26,523
    
    
    $
    26,443
 (3) Debt
    14




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BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS  (continued)
 (4) Payable to Comstock Resources
  (5) Stockholders Equity
   (6) Long-term Incentive Plan
  15




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##### Table of Contents



BOIS dARC ENERGY, INC.
BOIS dARC ENERGY, LLC PREDECESSORS
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS  (continued)
  Number of OptionsGranted and
    
    Weighted Average
    
    Weighted Average
    
    Number of OptionsExercise Price
    
    Outstanding
    
    Exercise Price
    
    Remaining Life
    
    Exercisable(years)$6.00  $12.80
    
    
    2,887,500
    
    
    
    $6.19
    
    
    
    8.7
    
    
     (1)
 
 (1)
    
    The options vest over five years with service to the Company.   (7) Commitments and Contingencies
 Contingencies
  (8) Related Party Transactions
   16




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##### Table of Contents



ITEM 2: MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
  Overview
 Our Business.
     17




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Our Predecessors.
 Our Formation.
 18




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##### Table of Contents



Comparability of Results
  Results of Operations
  Bois dArc
    
    
    Bois dArcEnergy, Inc.
    
    
    Energy, LLCThree Months
    
    
    Period fromEnded
    
    
    Inception toSeptember 30,
    
    
    September 30,2005
    
    
    2004($ in thousands, except per unit amounts)Revenues:Oil and gas sales
    
    $
    43,434
    
    
    $
    37,358Expenses:Oil and gas operating(1)
    
    $
    8,344
    
    
    $
    7,293Exploration
    
    $
    2,826
    
    
    $
    6,660Depreciation, depletion and amortization(2)
    
    $
    9,172
    
    
    $
    12,150Net Production Data:Oil (Mbbls)
    
    
    245
    
    
    
    440Natural gas (Mmcf)
    
    
    3,306
    
    
    
    3,129Natural gas equivalent (Mmcfe)
    
    
    4,775
    
    
    
    5,769Average Sales Price:Oil (Bbls)
    
    $
    59.96
    
    
    $
    42.54Natural gas (Mcf)
    
    $
    8.70
    
    
    $
    5.96Average equivalent price (per Mcfe)
    
    $
    9.10
    
    
    $
    6.48Expenses ($  per Mcfe):Oil and gas operating(1)
    
    $
    1.75
    
    
    $
    1.26Depreciation, depletion and amortization(2)
    
    $
    1.92
    
    
    $
    2.11
 
 (1)
    
    Includes lease operating costs and production and ad valorem taxes.(2)
    
    Represents depreciation, depletion and amortization of oil and gas properties only. 19




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##### Table of Contents



CombinedBois dArcBois dArc
    
    
    Bois dArc
    
    
    Energy, LLCEnergy, Inc.
    
    
    Energy, LLC
    
    
    Predecessors
    
    
    CombinedNine Months
    
    
    Period from
    
    
    Period from
    
    
    Nine MonthsEnded
    
    
    Inception to
    
    
    January 1, 2004
    
    
    EndedSeptember 30,
    
    
    September 30,
    
    
    to July 15,
    
    
    September 30,2005
    
    
    2004
    
    
    2004
    
    
    2004($ in thousands, except per unit amounts)Revenues:Oil and gas sales
    
    $
    135,595
    
    
    $
    37,358
    
    
    $
    70,341
    
    
    $
    107,699Expenses:Oil and gas operating(1)
    
    $
    24,324
    
    
    $
    7,293
    
    
    $
    15,233
    
    
    $
    22,526Exploration
    
    $
    10,516
    
    
    $
    6,660
    
    
    $
    2,676
    
    
    $
    9,336Depreciation, depletion and amortization(2)
    
    $
    33,657
    
    
    $
    12,150
    
    
    $
    22,831
    
    
    $
    34,981Net Production Data:Oil (Mbbls)
    
    
    956
    
    
    
    440
    
    
    
    832
    
    
    
    1,272Natural gas (Mmcf)
    
    
    11,718
    
    
    
    3,129
    
    
    
    6,267
    
    
    
    9,396Natural gas equivalent (Mmcfe)
    
    
    17,457
    
    
    
    5,769
    
    
    
    11,260
    
    
    
    17,029Average Sales Price:Oil (Bbls)
    
    $
    51.54
    
    
    $
    42.54
    
    
    $
    36.50
    
    
    $
    38.59Natural gas (Mcf)
    
    $
    7.36
    
    
    $
    5.96
    
    
    $
    6.38
    
    
    $
    6.24Average equivalent price (per Mcfe)
    
    $
    7.77
    
    
    $
    6.48
    
    
    $
    6.25
    
    
    $
    6.32Expenses ($  per Mcfe):Oil and gas operating(1)
    
    $
    1.39
    
    
    $
    1.26
    
    
    $
    1.35
    
    
    $
    1.32Depreciation, depletion and amortization(2)
    
    $
    1.93
    
    
    $
    2.11
    
    
    $
    2.02
    
    
    $
    2.05
 
 (1)
    
    Includes lease operating costs and production and ad valorem taxes.(2)
    
    Represents depreciation, depletion and amortization of oil and gas properties only. Revenues -
  Oil and gas sales.
  20




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Costs and Expenses -
 Oil and gas operating expenses.
 Exploration expense.
 Depreciation, depletion and amortization.
 General and administrative expenses.
 Interest expense.
 21




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Income taxes
 Net income.
 Critical Accounting Policies
  Liquidity and Capital Resources
    CombinedBois dArcBois dArc
    
    
    Bois dArc
    
    
    Energy, LLCEnergy, Inc.
    
    
    Energy, LLC
    
    
    PredecessorsNine Months
    
    
    
    
    
    
    Period from
    
    
    CombinedEnded
    
    
    Period from
    
    
    January 1,
    
    
    Nine Months EndedSeptember
    
    
    Inception to
    
    
    2004 to
    
    
    September 30,30, 2005
    
    
    September 30, 2004
    
    
    July 15, 2004
    
    
    2004($ in thousands, except per unit amounts)Acquisitions of proved oil and
gas properties
    
    $
    
    
    
    $
    
    
    
    $
    715
    
    
    $
    715Acquisitions of unproved oil and
gas properties
    
    
    3,813
    
    
    
    560
    
    
    
    2,049
    
    
    
    2,609Exploration and development
expenditures
    
    
    119,910
    
    
    
    19,331
    
    
    
    80,509
    
    
    
    99,840Other
    
    
    1,354
    
    
    
    331
    
    
    
    
    
    
    
    331$
    125,077
    
    
    $
    20,222
    
    
    $
    83,273
    
    
    $
    103,495
 22




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23




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##### Table of Contents



(In thousands)Operating leases
    
    $
    2,393Contracted drilling services
    
    $
    24,049Acquisition of seismic data
    
    $
    8,340
 
 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ON MARKET RISKS
 Oil and Natural Gas Prices.
 Interest Rates.
 24




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ITEM 4. CONTROLS AND PROCEDURES
   25




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PART II  OTHER INFORMATION
 
 ITEM 6. EXHIBITS
 Exhibits
 31.1*
    
    Section 302 Certification of the Chief Executive Officer.31.2*
    
    Section 302 Certification of the Chief Financial Officer.32.1*
    
    Certification for the Chief Executive Officer as required by Section 906 of the Sarbanes-Oxley Act of 2002.32.2*
    
    Certification for the Chief Financial Officer as required by Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Filed herewith 26




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SIGNATURES
  BOIS dARC ENERGY, INC.Date: November 14, 2005
    /s/ WAYNE L. LAUFERWayne L. Laufer, Chief Executive Officer(Principal Executive Officer) Date: November 14, 2005
    /s/ ROLAND O. BURNSRoland O. Burns, Senior Vice President,Chief Financial Officer, Secretary, and Treasurer
(Principal Financial and Accounting Officer) 27