PITTSBURGH CNX Gas Corporation reported record net income for the quarter ended June 30, 2008 of $64.3 million, or $0.42 per diluted share. This was 55% higher than the net income of $41.5 million, or $0.27 per diluted share, for the quarter ended June 30, 2007, and the highest quarterly net income in the company's three-year history.

Gas production was also a record, at 18.8 billion cubic feet (Bcf), or 206.5 million cubic feet (MMcf) per day, for the quarter ended June 30, 2008. This was 26% higher than the 14.9 Bcf, or 163.6 MMcf per day, for the quarter ended June 30, 2007. It was also 18% higher than the 15.9 Bcf produced in the March 2008 quarter.

Nicholas J. DeIuliis, president and chief executive officer, said, "For the second consecutive quarter, CNX Gas achieved record performance. Our net income and production in the second quarter were the highest in our three-year history. Also, our employees continued to work without a lost-time accident. For 2008, we now expect to produce 73 Bcf, which will be 25% higher than our 2007 production. The higher guidance primarily reflects our continued coalbed methane (CBM) efforts across our development plays.

"We also drilled four additional Chattanooga Shale wells after our successful test well. The first two wells are producing at 450-460 Mcf per day. Two additional wells are in various stages of clean up, but initial results are encouraging. We also consolidated our acreage position in the Chattanooga Shale to 235,000 net acres by adding just over 100,000 net acres. CNX Gas now has a leading acreage position as well as first-mover advantage in the Chattanooga Shale. We don't intend to relinquish either as we continue drilling in this unfolding shale play."

In the Marcellus Shale, CNX Gas brought its first well online last Friday. Preliminary results from the well were favorable, with a flow rate of 1.3 MMcf per day on a 56/64" choke and 50 pounds of back pressure. Because of the strong initial reading, a 24-hour open flow test was not necessary. Instead, the well was immediately placed online where it is currently equilibrating, producing 480 Mcf per day, and generating a choke-back pressure of 2,300 pounds.

At June 30, 2008, the company had cash on hand of $23.1 million, while $27.0 million was drawn upon its credit facility. Capital expenditures for the quarter were $149.3 million and quarterly return on capital employed was 25.9%, on an annualized after-tax basis.