Press release from Business Wire
WPX Energy's Niobrara Discovery Well Hits Production Milestone
Monday, April 08, 2013
WPX Energy's Niobrara Discovery Well Hits Production Milestone08:00 EDT Monday, April 08, 2013
TULSA, Okla. (Business Wire) -- WPX Energy (NYSE:WPX) announced today that its Niobrara Shale discovery well in the Piceance Basin exceeded 1 billion cubic feet of natural gas production in just over 100 days of operation.
At this rate, WPX expects the Niobrara well to produce in its first four months what a typical well in the Piceance Basin's Williams Fork formation produces over its estimated lifecycle of 25 to 30 years.
The Niobrara well is located on WPX's acreage in Western Colorado, where the company has the lease rights to approximately 180,000 net acres of the Niobrara/Mancos shale play.
The discovery well initially produced 16 million cubic feet per day at a flowing pressure of 7,300 pounds per square inch. It registered an average production rate of almost 10 million cubic feet per day over its first 90 days, despite being choked back substantially.
“We're very pleased with what we're seeing,” said Ralph A. Hill, WPX's president and chief executive officer. “This well is demonstrating tremendous strength. It's a large discovery that has significant upside potential for creating shareholder value.”
Over time, WPX believes that its Niobrara discovery has the potential to more than double the company's proved, probable and possible (3P) reserves, which were approximately 18 trillion cubic feet at year-end 2012.
WPX started drilling its second Niobrara well on Wednesday, April 3. The company expects to begin completion activities in June.
As previously announced, WPX plans to drill a total of four horizontal Niobrara wells in 2013. The drilling plan is designed to prove up adjacent acreage and test the repeatability of the play on additional acreage the company owns.
WPX already has extensive processing and takeaway capacity under contract in the Piceance to support Niobrara production.
The Niobrara and Mancos shales are generally located at depths of 10,000 to 13,000 feet. The Williams Fork is a shallower formation, generally located at depths of 6,000 to 9,000 feet. In the Piceance Basin, WPX holds an average working interest of 66 percent in the Niobrara and Mancos shales.
About WPX Energy, Inc.
WPX Energy is an exploration and production company focused on developing its significant oil and gas reserves, particularly in the liquids-rich Piceance Basin, the Bakken and Three Forks oil shales and the Marcellus Shale. WPX also has domestic operations in the San Juan and Powder River basins, as well as a 69 percent interest in Apco Oil and Gas International. Go to http://www.wpxenergy.com/investors.aspx to join our e-mail list.
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the company expects, believes or anticipates will or may occur in the future are forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the company. Statements regarding future drilling and production are subject to all of the risks and uncertainties normally incident to the exploration for and development and production of oil and gas. These risks include, but are not limited to, the volatility of oil, natural gas and NGL prices; uncertainties inherent in estimating oil, natural gas and NGL reserves; drilling risks; environmental risks; and political or regulatory changes. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. The forward-looking statements in this press release are made as of the date of this press release, even if subsequently made available by WPX Energy on its website or otherwise. WPX Energy does not undertake and expressly disclaims any obligation to update the forward-looking statements as a result of new information, future events or otherwise. Investors are urged to consider carefully the disclosure in our filings with the Securities and Exchange Commission, available from us at WPX Energy, Attn: Investor Relations, P.O. Box 21810, Tulsa, Okla., 74102, or from the SEC's website at www.sec.gov .
Additionally, the SEC requires oil and gas companies, in filings made with the SEC, to disclose proved reserves, which are those quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible – from a given date forward, from known reservoirs, under existing economic conditions, operating methods, and governmental regulations. The SEC permits the optional disclosure of probable and possible reserves. From time to time, we elect to use “probable” reserves and “possible” reserves, excluding their valuation. The SEC defines “probable” reserves as “those additional reserves that are less certain to be recovered than proved reserves but which, together with proved reserves, are as likely as not to be recovered.” The SEC defines “possible” reserves as “those additional reserves that are less certain to be recovered than probable reserves.” The Company has applied these definitions in estimating probable and possible reserves. Statements of reserves are only estimates and may not correspond to the ultimate quantities of oil and gas recovered. Any reserve estimates provided in this presentation that are not specifically designated as being estimates of proved reserves may include estimated reserves not necessarily calculated in accordance with, or contemplated by, the SEC‘s reserves reporting guidelines. Investors are urged to consider closely the disclosure in our SEC filings that may be accessed through the SEC's website at www.sec.gov .
The SEC's rules prohibit us from filing resource estimates. Our resource estimations include estimates of hydrocarbon quantities for (i) new areas for which we do not have sufficient information to date to classify as proved, probable or even possible reserves, (ii) other areas to take into account the low level of certainty of recovery of the resources and (iii) uneconomic proved, probable or possible reserves. Resource estimates do not take into account the certainty of resource recovery and are therefore not indicative of the expected future recovery and should not be relied upon. Resource estimates might never be recovered and are contingent on exploration success, technical improvements in drilling access, commerciality and other factors.
Kelly Swan, 539-573-4944
David Sullivan, 539-573-9360