Operator: Ladies and gentlemen, thank you for standing by and welcome to the 2010 Second Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remark, there will be a question-and-answer session. (Operator Instructions).
I will now turn the call over to Scott Winters, Vice President of Corporate Communications. Please go ahead, sir.
Scott Winters - VP, Corporate Communications: Operator, thank you very much. Good morning, everybody. Welcome to PXP's 2010 quarterly earnings conference call, which is also being broadcast live on the Internet. Anyone may listen to the call or the replay by accessing the Company's website at pxp.com. Also located on the website are the earnings release, a slide presentation and the Form 10-Q.
Before we begin today's comments, I'd like to remind everyone that during this call there will be forward-looking statements as defined by the SEC. These statements are based on our current expectations and projections about future events and involve certain assumptions, known as well as unknown risks, uncertainties and other factors that could cause our actual results to differ materially. Please refer to our filings with the SEC, including our Form 10-K, for a discussion of these risks.
In our press release and our prepared comments this morning we present non-GAAP measures. A reconciliation of non-GAAP financial measures to comparable GAAP financial measures is included with the press release.
On the call today is Jim Flores, our Chairman, President and Chief Executive Officer; Doss Bourgeois, our Executive Vice President of Exploration and Production; Winston Talbert, Executive Vice President and Chief Financial Officer; John Wombwell, our Executive Vice President and General Counsel; and Hance Myers, our Vice President of Investor Relations.
For the second quarter 2010, revenues were $364.6 million and net income was $45.4 million or $0.32 per diluted share compared to revenues of $278.7 million and net income of $43.6 million or $0.37 per diluted share for the second quarter 2009.
These results include certain items affecting the comparability of operating results. Those items consist of realized and unrealized gains and losses on our mark-to-market derivative contracts, which exclude the impact of the derivatives monetized in 2009, a non-cash impairment charge related to our Vietnam oil and gas properties in 2010 and a legal recovery in 2009 and other items.
When considering these items, net income for the second quarter 2010 was $36.9 million or $0.26 per diluted share compared to $71.7 million or $0.60 per diluted share for the same period in 2009. This is a non-GAAP measure.
Net cash provided by operating activities was $252.7 million and operating cash flow was $212.3 million for the second quarter of 2010 compared to net cash provided by operating activities of $171 million and operating cash flow of $224.1 million for the second quarter of 2009. Operating cash flow is a non-GAAP measure.
Sales price realizations before derivative transactions were 86% for oil and 99% for natural gas during the second quarter of 2010 versus 83% for oil and 96% for natural gas in the second quarter of 2009. 2010 second quarter oil and gas revenues when compared to the second quarter of 2009 were higher, due primarily to a $9.15 per BOE increase in realized prices before derivatives.