Haynesville Shale Formation - Company Stocks Involved
in Drilling and/or Acreage- Shreveport Shale
If you've been following the Haynesville Shale Story, you've probably noticed that the stocks of the companies involved exploded to the upside when Natural Gas
prices were soaring through the roof in 2008. Most companies that were very active in the Haynesville Shale saw their
stock prices double and triple in price. The recent decline in the stock market popped the bubble in energy prices.
This provides a great buying opportunity for the companies below. In a few years, you might see these stocks double or
triple again if natural gas prices move higher. I not only produce the Top 2010 Stock Gainer List every day I watch it closely. Below is a list of public companies that are drilling in the haynesville shale.
Chesapeake Energy - CHK - Haynesville and Bossier shales (Northwest Louisiana,
East Texas): Chesapeake is the largest leasehold owner and most active driller of new wells in the Haynesville
Shale play in Northwest Louisiana and East Texas. Chesapeake now owns approximately 530,000 net acres of leasehold in the
Haynesville Shale play. The company also has approximately 185,000 net acres of leasehold it believes is prospective for the
Bossier Shale. On its Haynesville and Bossier leasehold, Chesapeake estimates it has approximately 24 tcfe of risked unproved
resources and 39 tcfe of unrisked unproved resources.
The company has drilled and completed 215 gross Chesapeake-operated
horizontal wells in the Haynesville and Bossier since discovering the play in 2007. During the 2010 first quarter, Chesapeake's
average daily net production of 425 mmcfe in the Haynesville increased approximately 15% over the 2009 fourth quarter and
approximately 465% over the 2009 first quarter. Chesapeake is currently producing approximately 510 mmcfe net per day from
the Haynesville and Bossier shales. The company is currently drilling with 36 operated rigs in the Haynesville and anticipates
operating an average of approximately 35 rigs in 2010 to drill approximately 170 net wells.
Three notable recent wells
completed by Chesapeake in the Haynesville are as follows:
The Fuller 8-13-13
H-1 in De Soto Parish, LA achieved a peak 24-hour rate of 23.7 mmcf per day;
The Sloan 4-13-13 H-1 in De Soto Parish,
LA achieved a peak 24-hour rate of 21.9 mmcf per day; and
The Pankey 23-14N-15W H-1 in De Soto Parish, LA achieved
a peak 24-hour rate of 18.9 mmcf per day. More.........
Goodrich Petroleum - GDP - Louisiana - Bethany
Longstreet Field, Caddo and DeSoto Parishes, Louisiana. In the Bethany Longstreet field, the Company conducted drilling
operations on 10 gross (3 net) Haynesville Shale horizontal wells during the quarter. In addition, the Company reached total
depth on 9 gross (3 net) wells and added a total of 5 gross (2 net) wells to production during the quarter.
Within the existing joint development agreement with Chesapeake Energy Corporation ("Chesapeake"),
the Company is currently running three rigs and conducting completion operations on seven wells.
Also
in the Bethany Longstreet field but outside of the joint development agreement with Chesapeake, the Company, as operator,
has drilled and completed the Garland 24H-1 (24% WI), with an initial production rate of 14,500 Mcfe per day on a 22/64 inch
choke with 7,300 psi.
Greenwood Waskom/Metcalf Fields, Caddo
Parish, Louisiana. The Company, as operator, has also successfully drilled and completed the Wayne Bryan 3H-1 (78%
WI), its second Haynesville Shale well in the Greenwood Waskom/Metcalf Field area, with an initial production rate of 17,000
Mcfe per day on a 22/64 inch choke with 7,500 psi. The Company is currently completing its Wayne Bryan 4H-1 (74% WI), with
results expected in the second quarter. Goodrich is also
very active in the Cotton Valley Shale. More.........
PetroHawk Energy - HK -Haynesville Shale - In the first quarter the Company continued to execute its
plan of lease capture in the Haynesville Shale. Continued efficiencies are driving down the spud to spud days, which have
resulted in more flexibility in its Haynesville Shale drilling program. Petrohawk intends to utilize fourteen operated rigs
for the balance of 2010. The forecasted number of operated wells, approximately 110, is expected to remain the same as under
the previous budget due to the increased drilling efficiencies.
Additionally, the Company continues to experience positive
results from its completion program. A sample set of wells in the Coushatta area in Red River Parish shows a definitive trend
of declining completion cost per Mcf of Estimated Ultimate Recovery (EUR) in conjunction with an improving Mcf of EUR per
foot of lateral length. Petrohawk will continue to test all aspects of the completion design in the attempt to optimize both
performance and cost.
The Company's expanded restricted rate program, including both newly drilled wells and wells
drilled prior to 2010, continues to yield positive results that indicate improvement in both first year production totals
and EUR. As of the end of the first quarter all newly completed wells will be produced at a restricted rate, typically between
7 and 13 Mmcfe/d. The trend noted in the decline curves from the older wells that have been producing on restricted rate,
the oldest of which is now over nine months, suggests potential increases in EUR, some significant, as compared to nearby
wells produced using conventional production practices.
A companion program of the restricted rate program is an initiative
to restrict production from already-producing Haynesville Shale wells. A group of test wells were selected, typically producing
on a 24/64" choke, and placed on a 14/64" choke. The results from these wells show flatter decline curves that not
only model to a potentially higher EUR, but in aggregate also model a flatter overall PDP decline for the Company in future
years. Petrohawk now plans to restrict the rates of all Haynesville Shale wells.
Lower Bossier Shale
The
first Petrohawk operated Lower Bossier Shale well, the Whitney Corp 19 #1H, will spud during May in Section 19-T10N-R13W,
Sabine Parish, Louisiana. This well is located in proximity to a number of recently completed wells which tested the Lower
Bossier Shale at rates and pressures comparable to many of the field's better Haynesville Shale wells. Hawk Field Services
is in the final stages of completing a pipeline into this area and the Company expects to place the well on production upon
completion. More.........
Devon Energy DVN - Devon completed three Haynesville Shale wells within Shelby
and Nacogdoches counties in the first quarter. Initial 24-hour production rates for the three horizontal wells averaged six
million cubic feet of gas equivalent. Devon has a 100 percent working interest in the wells. More.........
XTO Energy- XTO - XTO Energy recently made an acquisition of Hunt Petroleum which will bring XTO energy into the Haynesville Shale formation
play. With this Hunt Petroleum buyout, XTO will gain acreage positions in East Texas, North & Central Louisiana
Haynesville Shale areas. The deal is supposed to close September 2008. Going into this deal, we have identified
hundreds of locations to expand recovery and access the multi-pay targets – including the Pettit, Rodessa, Travis Peak,
Cotton Valley and Bossier formations.” XTO Energy now has 100,000 Haynesville Shale Acres. XTO wants to pick up additional acreage and drill 3-4 horizontal wells
by the end of the year. XTO 2009 Update: We drilled first Haynesville shale well in
western Panola County, the New Horizon's number one that came in at 8.5 million a day, that is not an IP, that well averaged
over 8 million a day for the first 15 days. If we go from that to Stockman Fields in Shelby County, we drilled our first
Haynesville lime wells, before other companies
talked about this area it came in at 10 million a day. We have pretty extensive acreage position down there for development
as well. And then we brought in two James Lime horizontal wells at around 5 million a day in that same Shelby County area,
so we're pretty excited about that stuff More.........
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Forest Oil Company - FST - East Texas, North Louisiana - Haynesville / Bossier Shale - During
the first quarter of 2010, Forest added approximately 25,200 gross (16,700 net) acres in the core area of the Haynesville
/ Bossier Shale play. As of March 31, 2010, Forest holds approximately 40,200 gross (27,900 net) acres in the core area of
the Haynesville / Bossier Shale, which included Red River and Sabine Parishes, Louisiana and Shelby County, Texas. In addition,
Forest has approximately 62,700 gross (44,400 net) acres prospective for the Haynesville / Bossier Shale primarily in Harrison,
Panola, and Rusk Counties, Texas. Forest currently has two wells completing in Red River Parish, Louisiana and expects to
drill 13 wells for the remainder of 2010 in the core area of the Haynesville / Bossier Shale play. Forest
Oil is also active in the Cotton Valley Formation. More.........
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Exco Resources - XCO - Exco Resources XCO is a new company getting into the Bossier/Haynesville
Shale play in a big way. 53,500 net Haynesville acres (~69,000 pro
forma for Common transaction); significant held by production position - Average IP rate from our operated - Haynesville horizontal
wells in DeSoto Parish continues to be approximately 23 Mmcf per day - XCO
is active in the Cotton Valley Field. More.........
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Cabot Oil & Gas - The Company recently finished its second operated Haynesville Shale well that
was completed with a 16-stage frac, on a 4,925' lateral. The well produced at a max rate of 20.5 Mmcf per day and at a restricted
24-hour rate of 15.5 Mmcf per day. In addition to this well, the Company has three completions occurring in the area at this
time, with six additional Haynesville/Bossier wells drilling or waiting on completion. "Information from Cabot's wells
and numerous industry wells around County Line indicates the Haynesville shale is a prolific productive zone in this area,"
said Dinges. "With this latest result and expectations for the new completions, Cabot's Haynesville production has the
potential to increase significantly during the second half of the year. Adding to this potential is our first Bossier test
which, based on recent prolific nearby industry wells, creates more excitement."
Cotton Valley Formation - Additionally in Texas, the Company completed its third horizontal Cotton Valley Taylor Sand well with the best result to date. This well flowed
at an initial production rate of 11.1 Mmcf per day with pressure at 2,425 psi. "The estimated recovery of our recent
wells in this area ranges between six to seven Bcfe," commented Dinges.
Berry Petroleum - BRY - We plan to run one rig during 2009 and will drill approximately five vertical wells in the Oakes field during
the year and plan to begin drilling horizontal wells in the Haynesville Shale Darco field in the third quarter of 2009.
.
Encana- ECA - Encana ECA recently announced that they have established acreage positions in the Haynesville Shale. The Deep
Bossier continues to be a leading near-term driver of EnCana's future production growth in East Texas. We strengthened
our position in the Haynesville gas resource play by acquiring 25,000 net acres, increasing our land position to about
400,000 net acres, plus 63,000 net acres of mineral rights. We currently have six rigs running with a focus on cost reduction and completion optimization. We will target drilling
and completing the first well in the mid-Bossier shale in the fourth quarter The Haynesville Shale is a very exciting emerging
play with a potential to rival the quality and scope of the Barnett shale play. With the few number of wells that were drilled in the Haynesville
so far, we've seen, and some of our competitors or industry competitors, have seen initial production rates which are
in the order of twice that of the ... some of the best wells ever drilled in the Barnett
Shale play. More.........
2010 Update: In the Haynesville we continue to be very
active in our land retention program. We currently have 23 rigs working this resource play and although we are still only
drilling one well per location at this time to help maximize the amount of land retained we’re becoming an increasingly
more efficient with our drilling as we continue to optimize technology and processes.
Our spud to rig release times are
moving to below 40 days with our 2010 target of 35 days even though we are drilling horizontal wells with longer laterals.
Expected efficiencies to improve even further once we begin pad drilling.
During the quarter we drilled 20 of our planned
110 net well drilling program for 2010 currently producing about 250 Bcfe/d net to EnCana from the Haynesville formation and we are on track to exit the year producing about 400 to
500 Bcfe/d net from this high growth resource play.
Given the level of activity the industry is currently seeing in
the Haynesville inflationary pressures are becoming
a concern to us. Sherri Brillon will talk more about this in a few minutes, but I wanted to point out that in the Haynesville as in most of our other areas of operation EnCana has contracted all our
required service for 2010 thereby mitigating inflationary pressures in this region.
EOG Resources - EOG - In an area where EOG had previously focused on the Haynesville, EOG reported strong production results
from its first Bossier natural gas test. The Sustainable Forest 5 - No. 2 Alt., drilled to a vertical depth of 11,400 feet
in the Trenton prospect area in DeSoto Parish, La., began producing at 13 million cubic feet per day. EOG has 100 percent
working interest in the well that is estimated to have reserves in excess of 8 billion cubic feet. EOG is currently operating
five rigs in the Trenton prospect where it is drilling and developing both the Bossier and Haynesville reservoirs concurrently.
Penn Virginia PVA - East Texas - During the first quarter of
2010, we drilled three (2.8 net) Lower Bossier (Haynesville) Shale horizontal wells, all of which are waiting on completion.
Since we resumed drilling late last year, we have faced delays in completions that have resulted in our having an inventory
of five wells that are waiting on completion. The delays relate to the scarcity of high working pressure pumping equipment
with sufficient rating to stimulate Lower Bossier Shale wells.
We currently have two operated rigs drilling wells, one
targeting the Lower Bossier Shale and one targeting the horizontal Cotton Valley. Due to the completion delays and the inventory
of uncompleted Lower Bossier Shale wells, after drilling one more Lower Bossier Shale well, we expect to devote both drilling
rigs to the horizontal Cotton Valley program. This two-rig Cotton Valley program will continue until the Lower Bossier Shale
completion program is caught up, most likely late in the third quarter. Primarily as the result of the completion delays,
we have slightly lowered the upper end of 2010 production guidance by 1.0 Bcfe, or two percent. PVA is also active in the Cotton Valley field.
GMX Resources - GMXR - As previously announced, the Company completed two Haynesville/Bossier
horizontal wells ("H/B Hz") in the first quarter. The Company successfully completed the Mia Austin #1H H/B Hz with
a 14.1 million cubic feet of gas per day ("MMCF/D") initial production ("IP") rate. The well has a 4,600
foot lateral, with 12 frac stages and was flowing on a 20/64 choke with 5,492 pounds of Flowing Casing Pressure ("FCP")
into a sales line with 850 pounds of Line Pressure ("LP"). Additionally, the Company successfully completed the
Verhalen E #1H with an 8.3 MMCF/D IP rate. This well has a 4,300 foot lateral, with 12 frac stages and was flowing on an 18/64
choke with 3,870 pounds FCP into a sales line with 640 pounds of LP. These wells were the last two using 4 1/2" casing.
All future H/B Hz wells will use 5 1/2" casing.
Two additional wells were rescheduled from Q1 to early Q2 and have
been successfully completed. The Bosh #19H H/B Hz was tested with a 10.1 MMCF/D IP rate. The well was drilled with a 4,153
foot lateral, and stimulated with 12 frac stages, however during the process of drilling out the plugs an obstruction prevented
the last 6 of 12 frac stages from being accessed. After several attempts the Company made a decision to cease current efforts
to drill out the remaining plugs and produce the well from approximately 6 of the 12 frac stages across 2,174 feet of the
open lateral. The well test was over 24 hours on a 14/64 choke with 4,526 pounds of FCP into a sales line with 590 pounds
of LP. Also originally scheduled for Q1 and rescheduled to Q2 was the Verhalen D #3H H/B Hz which tested with an 11.1 MMCF/D
IP rate. The well was drilled with a 4,900 foot lateral and stimulated with 11 frac stages. The well test was over 24 hours
on a 22/64 choke with 5,200 pounds of FCP into a sales line with 627 pounds of LP.
Scheduled for completion in Q2 and
previously announced was the Blocker Heirs #20H H/B Hz with a 14.4 MMCF/D IP rate. The well was drilled with a 4,450 foot
lateral and stimulated with 11 frac stages. The well test was over 24 hours on a 20/64 choke with 5,890 pounds of FCP into
a sales line with 975 pounds of LP. The Verhalen E #6H H/B Hz has also been completed in Q2 and had an IP rate of 11.1 MMCF/D.
This well was drilled with a 4,500 foot lateral and stimulated with 10 frac stages. The well test was over 24 hours on a 20/64
choke with 5,283 pounds of FCP into a sales line with 635 pounds of LP. .
More.........
Anadarko Petroleum APC - Anadarko has more than 80,000 net acres in the prospective
fairway of the Haynesville Shale, the majority held by production underneath our
producing fields in the Carthage area in Texas and Elm Grove in Louisiana. Anadarko operated one rig
in the haynesville shale and spud its 2nd horizontal well during the quarter.
Anadarko Petroleum ( APC ) 2010 Update - Drilling activity continued with two operated and one nonoperated rig. During the
quarter, Anadarko and its partners spud five wells and completed one well. The Anadarko-operated Bailey Sheppard 2-12
HH, drilled in Rusk county, had an initial production rate of 12.7 MMcf/d with 6,211 psi of flowing tubing pressure.
Questar STR - Questar E&P has approximately 43,000 net acres of Haynesville Shale lease rights in northwest Louisiana. The
depth of the top of the Haynesville Shale ranges from approximately 10,500 feet to 12,500 feet across Questar E&P's leasehold
and is below the Hosston and Cotton Valley formations, a target of Questar E&P development drilling for over a decade.
Questar E&P intends to drill or participate in up to 35 horizontal Haynesville Shale wells in 2009. As of September 30,
2009, Questar E&P had six operated rigs drilling in the project area and operated or had working interests in 598 producing
wells in northwest Louisiana compared to 463 at September 30, 2008. Questar
is also involved in the Cotton Valley Field.
SandRidge Energy SD - Sandridge is active in the East Texas side of the Haynesville Shale -
East Texas/North Louisiana – Haynesville Shale Play:
The company controls approximately 36,000 acres
in the developing Haynesville shale play of East Texas and North Louisiana. About 22,500 acres of that
total are in Rusk and Harrison Counties, Texas. The company drilled two vertical test wells within the
Oakhill field area in Rusk County to evaluate the potential for Haynesville shale production. The initial
well had a total of 260 feet of Haynesville shale thickness and tested at a rate of 1.5 MMcfe per day.
The second well encountered 288 feet of shale thickness and is awaiting completion.
Plains Exploration PXP - The Haynesville Shale continues to deliver outstanding drilling results with 49 horizontal wells drilled and
completed. Production is currently 21 million cubic feet equivalent (MMCFE) per day net to PXP (160 MMCFE per day gross) with
approximately 9 MMCFE per day net to PXP (70 MMCFE per day gross) currently curtailed from the play.
Continental Resources CLR- Continental CLR is a new operator in the Haynesville Shale. They currently have 17,000 acres in Louisiana but are
not saying what parish they are in. They will be drilling their first well in the fourth quarter.
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Nabors Industries NBR - Nabors NBR supplies drilling rigs to Haynesville Shale companies/operators. We have 32 rigs
now working in the Haynesville Shale, compared to 20 at the beginning of the year, and we expect to have 40 or 50, probably closer
to 50 by the end of the year. Also, we have kind of a unique advantage, if an operator needs a rig, and he really wants a
built for purpose specialty design new build, and he needs a good rig right away, we can give him a rig to bridge the gap
between his requirements right now and when he will get the new build which could be 9, 10, 11, 12, 13 months from now.
.
Encore Aquisition - EAC - Encore elected to exercise its preferential right to purchase the interest of its partners in its Greenwood
Waskom/Stateline prospect for total consideration of $54 million subject to customary closing adjustments. The Company closed
the acquisition July 15, 2008 and will immediately take over operations on five units currently producing from the Cotton
Valley formation. Encore will also acquire the Haynesville rights in each of these units. Encore's average working interest
and net revenue interest will be approximately 92 percent and 72 percent, respectively. This acquisition will add approximately
3,200 net acres to Encore's existing 12,800 net acres in the heart of the Haynesville play, giving Encore a total of 16,000
net acres. Encore also owns approximately 6,600 net acres in the rapidly expanding extensional area of the play for a total
of 22,600 net acres in the Haynesville play. Encore is currently permitting locations and expects to add a rig to begin developing
its acreage in the Haynesville play in late 2008.
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St. Mary Land & Exploration - HAYNESVILLE CARRY AND EARNING AGREEMENT - St. Mary has entered into a CEA with a third
party that relates only to the Haynesville and Bossier intervals located on roughly 32,000 net acres in East Texas. The agreement
allows the third party to earn 95% of St. Mary's interest in approximately 8,400 net acres in Shelby County, Texas (the "North
Block") and 5% of St. Mary's interest in approximately 23,400 net acres in Shelby and San Augustine Counties, Texas (the
"South Block"). In exchange the Company will be carried in roughly $87 million in drilling and completion costs
for horizontal wells planned for the South Block. St. Mary will be the operator of wells drilled on the South Block. Once
St. Mary has completed the expenditure of the carry amount, the two parties will share all costs on the affected lands in
accordance with their respective ownership interests. St. Mary's acreage position in the Haynesville shale, adjusted for the
CEA, is roughly 32,300 net acres.
.
Noble Energy NBL- One final item of note onshore in the US concerns our Shelby County, Texas acreage, where we brought in a partner on our
Hainesville potential. Petrohawk has joined in
our approximately 15,000 acre position and will operate the first four wells before we resume operatorship. This joint venture,
with Noble retaining 60% working interest, represents an excellent opportunity to partner with one of the leading developers
of the Hainesville Shale, and we look forward
to working together to better understand this emerging resource. Our first well spud late May and we should have results in
the third quarter. We are also participating in a 25% Hainesville
well in the Caspiana Field in Louisiana with another operator.
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Marathon Oil MRO- MRO is new to the Haynesville Shale - Marathon has 25,000 acres in the Haynesville Shale in Louisiana and
Texas and will start drilling in 2009.
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Southwestern Energy SWN - East Texas - Production
from the company's East Texas properties was 9.6 Bcfe for the first three months of 2010,
compared to 7.8 Bcfe for the first three months of 2009. Southwestern participated in drilling 11 wells in East
Texas during the first three months of 2010, 6 of which were James Lime horizontal wells,
3 of which were Haynesville horizontal wells and 2 of which were Pettet horizontal oil wells.
.
Comstock Resources CRK - In the East Texas/North Louisiana region, Comstock drilled 13 wells (9.4 net) in the first quarter. Twelve of the
wells are Haynesville shale wells. Six of the operated Haynesville shale wells drilled in 2010 have been completed and had
an average initial production rate of 14.0 MMcfe per day. In the South Toledo Bend field in Sabine Parish, Louisiana, Comstock
drilled the Sustainable Forest 3#1H well to the upper section of the Haynesville shale or Bossier shale and completed the
well with 16 frac stages. The well's initial production rate was 20 MMcfe per day. Comstock has a 67% working interest in
this well. In the Logansport field in DeSoto Parish, Louisiana, Comstock completed two successful operated Haynesville shale
wells. The Horn 5 #1H well was drilled to a vertical depth of 11,275 feet with a 4,669 foot lateral. The well was completed
with 18 frac stages and was tested at an initial production rate of 20 MMcfe per day. Comstock has a 100% working interest
in this well. The Ramsey 4 #1H well was drilled to a vertical depth of 11,426 feet with a 4,616 foot horizontal lateral. The
well was completed with 18 frac stages and was tested at an initial production rate of 15 MMcfe per day. Comstock has a 100%
working interest in this well. In the North Toledo Bend field in DeSoto Parish, Louisiana, Comstock completed two successful
wells. The BSMC 1 #1H was drilled to a vertical depth of 11,416 feet with a 4,471 foot horizontal lateral. The well was completed
with 12 frac stages and was tested at an initial production rate of 9 MMcfe per day. Comstock has a 63% working interest in
this well. The BSMC 12 #2H was drilled to a vertical depth of 11,017 feet with a 4,431 foot horizontal lateral. The well was
completed with 12 frac stages and was tested with an initial production rate of 9 MMcfe per day. Comstock has a 66% working
interest in this well. In the Waskom field in Harrison County, Texas Comstock drilled the Clark H #1H well to a vertical depth
of 10,908 feet with a 4,261 foot horizontal lateral. The well was completed with 18 frac stages and was tested at an initial
production rate of 12 MMcfe per day. Comstock has a 100% working interest in this well.
Crosstex Energy XTXI - Crosstex XTXI has been drilling in Haynesville Shale. Prime locations in the Haynesville Shale included Harrison
County, Texas for XTXI
El Paso EP - El Paso continues to drill in the Haynesville Shale - ( From Seeking Alpha ) - We have an update for our Cotton Valley horizontal and Haynesville programs in the Arklatex.
El Paso Haynesville Shale Production -We started out below 10 million a day per well. And our most recent
well, the Blake 10H produced over 20 million a day, after 10 stages of fracs in the lateral. We’ll probably keep two
to four rigs running in the Arklatex that are capable of drilling these kind of wells, and we can drill somewhere in the neighborhood
of 15 to as many as 25 Haynesville wells this
year in 2009.
Unit Corp UNT - In the Haynesville trend in East Texas
we've now drilled five vertical wells in Shelby County. And we have two of the five wells hooked up to gas lines. Their early
production from these vertical wells on the first two wells has been somewhat disappointing, but certainly not conclusive
at this point. Both wells are currently flowing about 100 Mcfe a day and are experiencing some water loading problem.
We'll start drilling our first horizontal Haynesville well later this month and we'll plan to keep one or two Unit bridge drilling in the Haynesville in the Shelby County area during the third quarter of this year.
In
addition to the Shelby County activity, in addition to our activity, another operator has just announced plans to drill the
horizontal Haynesville well that's just adjacent
to our acreage block and this should also give us additional information and to evaluate our block.
The current plan
for 2009 is to drill a total of approximately nine vertical wells and one horizontal well in Shelby County at an approximate
cost of $25 million.
In addition to the Shelby County, Haynesville, we also plan on drilling three vertical Haynesville wells in Harrison County, at an approximate cost of $6.5 million. .
Denbury Resources DNR - Denbury's Haynesville Shale assets are up for sale - Within the Haynesville, we drilled two operated wells, the [Renfro] 5-1H and the [Korbies] 20-2H in 2010. We completed
the [Dun] 2-1, which was actually drilled in 2009 in the Renfro, and we are currently drilling a third well, the [Purvis]
20-3H. We have also participated in 10 non-operating wells during the first quarter of 2010.
The two Purvis wells are
on the same path and thus the completion of those wells will follow the finalized drilling of the 20-3H probably in early
June. First quarter production averaged approximately about 3,200 BOEs per day within the Haynesville, and our preliminary estimated April production averaged over 4,500 BOEs
per day.
