Cimarex Reports Fourth-Quarter Earnings of $0.38 Per Share

DENVER – February 20, 2003 – Cimarex Energy Co. (NYSE: XEC) today reported that fourth-quarter 2002 net income rose to $15.8 million, or $0.38 per diluted share, from $4.5 million, or $0.17 per share, in the fourth quarter of 2001.

Primary contributors to the 124 percent increase in earnings per share were higher natural gas and crude oil prices and a 45 percent boost in production volumes stemming from the September 30, 2002 merger with Key Production Company, Inc. (Key).

For the full year 2002, net income totaled $39.8 million, or $1.31 per diluted share, up from net income of $12.2 million, or $0.46 per share, for the twelve-months ended December 31, 2001.

On September 30, 2002, Cimarex was spun-off from Tulsa-based Helmerich & Payne, Inc. and became a stand-alone company. Also on that date, pursuant to a merger agreement, Cimarex acquired 100 percent of the outstanding common stock of Denver-based Key. The acquisition of Key by Cimarex has been accounted for using the purchase method of accounting effective September 30, 2002. As such, the fourth quarter of 2002 is the initial period in which the results of operations include combined company activity.

Fourth-quarter 2002 combined gas and oil production volumes averaged 180 million cubic feet equivalent (MMcfe) per day, up from 124 MMcfe per day during the fourth quarter of 2001. Natural gas production was 141.4 MMcf per day, compared to 110.6 MMcf per day during the prior year’s quarter. Oil production was 6,563 barrels per day versus 2,236 barrels per day during the fourth quarter 2001.

Fourth-quarter 2002 gas prices increased to an average of $3.60 per thousand cubic feet (Mcf) from $2.05 per Mcf during the same three months of 2001. Oil was sold at an average price of $25.43 per barrel versus $19.97 per barrel a year earlier.

Full-year 2002 production volumes averaged 132 MMcfe per day versus 128 MMcfe per day in 2001. Natural gas production was 113.2 MMcf per day, compared to 114.7 MMcf per day during 2001. Oil production was 3,209 barrels per day versus 2,175 barrels per day in 2001.

Even with the substantial increase in gas prices during the latter part of the year, the weighted-average price received for all of 2002 of $2.91 per Mcf was much lower than the average selling price in 2001 of $3.90 per Mcf. In contrast, oil prices averaged $24.91 per barrel in both years.

Operating cash flow in the fourth quarter of 2002 was $45.6 million, or $1.11 per diluted share, up from $16 million, or $0.60 per share, during the same three months of 2001. For all of 2002, operating cash flow totaled $110.7 million, or $3.65 per share. In 2001, operating cash flow was $124.9 million, or $4.70 per share. Operating cash flow is a non-GAAP measure that consists of net cash provided by operating activities adjusted for changes in operating assets and liabilities.

At December 31, 2002, debt totaled $32 million, or 6.7 percent of book capitalization. Since then, debt has been reduced to $20 million.

Year-end 2002 proved reserves increased 67 percent to 409 billion cubic feet (Bcf) equivalent, comprised of 319 Bcf of gas and 15 million barrels of oil. Of total proved reserves, 99.6 percent were classified as proved developed. The all-in cost of reserves added during 2002 was $1.74 per Mcf equivalent, including $1.90 per Mcf equivalent associated with the 150 Bcf equivalent of proved reserves added with the merger of Key.

The estimated present value of the future net cash flow before income taxes from year-end 2002 proved reserves, calculated under guidelines established by the Securities and Exchange Commission and using a 10 percent discount rate, is $741.2 million. For purposes of this calculation, Cimarex’s average gas price was $4.22 per Mcf and its oil price realization was $28.56 per barrel. The standardized measure of discounted cash flows after income taxes was $533.9 million.

Capital investment plans for 2003 contemplate exploration and development expenditures of $150 million, including $90 million for the Mid-Continent region and $40-45 in the Gulf Coast area. Capital investment plans may be modified during the year due to market conditions and other variables. In 2002, combined exploration and development costs incurred by Cimarex and Key (prior to its merger with Cimarex) approximated $110 million.

Projected growth in 2003 production will be highly dependent on the amount and success of the company’s capital investments, including the outcome of wells that have not yet been drilled. The production and sale of oil and gas also involves many other complex factors that are subject to numerous uncertainties, including reservoir risk, mechanical failure, market conditions, transportation issues, human error, and weather. Nonetheless, management currently assumes that aggregate gas and oil production will range between 180-190 MMcfe per day during 2003.

On September 30, 2002, the newly formed Cimarex Board of Directors voted to change the fiscal year of Cimarex from September 30 to December 31. A transition report was filed with the Securities and Exchange Commission (SEC) on November 14, 2002 on Form 10-Q as of and for the quarter ended December 31, 2001. Results of operations for the twelve months ended December 31, 2001 are unaudited and have been prepared by adding together results of operations for the nine-months ended September 30, 2001 and the quarter ended December 31, 2001. Tables containing quarterly statements of income for each of calendar years 2001 and 2002 have been included in this news release.

Conference call and web cast

The fourth quarter earnings conference call has been scheduled for 11 a.m. Mountain Time (1 p.m. Eastern), Thursday, February 20, 2003. Interested parties in the U.S. and Canada may access the call by dialing (800) 881-5262 and requesting the Cimarex Energy Co. teleconference. For other international callers, the number is (706) 645-9769. In addition, a listen-only web cast of the call will be provided at www.cimarex.com. If you are unable to participate in the live broadcast of the call, a replay will be available by dialing (800) 642-1687 and entering conference code 7933256. For those outside the U.S. or Canada, please dial (706) 645-9291 to access the replay. You may also access the replay via the Cimarex website.

Cimarex Energy Co. is an independent natural gas and crude oil exploration and production company with operations focused in Mid-Continent and Gulf Coast regions of the U.S.

This news release may contain projections and other forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Any such projections or statements reflect the Company’s current view with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that such projections will be achieved and actual results could differ materially from those projected. A discussion of important factors that could cause actual results to differ materially from those projected is included in the Company’s Registration Statement on Form S-4 filed with the Securities and Exchange Commission.