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**Pattern Alert**
VISA
Let price confirm. Adding second chart just something a little extra.
NICE chart! buTT 12,400 max IMVHO. 
My WAG.
Nice. DNR I thought support was $33.5 so I grabbed some there then it to $33 I was like "no good".. I was biting my fingernails in the morning. When I came out of the meeting after 5 hours, it went back up to close above $34.5. WEEEEEEEEEEEEEE
We really need DNR to stay above $34.75 (the last breakout)
DNR some DD
Ancient CO2 Helps Extract Oil From Nearly Tapped-Out Wells
BY MARILYN ALVA
Posted 6/3/2008
It might seem odd for an oil and gas company to put drawings of dinosaurs and other prehistoric creatures in an annual report.
Denbury Resources (DNR) doesn't see it that way.
The firm says its very foundation is based on geologic events that happened during the dinosaur age.
As the story goes, a volcano erupted, trapping carbon dioxide in porous rock that got buried underground.
Humans arrived. The wheel was invented, and on it went. Today, that trapped underground CO2 is still there, outside the city of Jackson, Miss.
Denbury has mineral lease rights to most of it — some 42,500 net acres in what it calls the Jackson Dome. The field holds about 5.6 trillion cubic feet of proven reserves.
"We control the only known source of CO2 in this region of the U.S.," said Phil Rykhoek, Denbury's chief financial officer.
That source is the only one known to exist east of the Mississippi. The surrounding region is home to numerous oil and gas fields abandoned by drillers who moved on to greener pastures when wells ran dry.
CO2 can bring those wells back to life. By pressure-pumping liquefied CO2 into the porous rock, trapped oil can be freed and extracted.
While oil and water don't mix, CO2 and oil are a perfect match.
But pipelines are needed to transport the CO2 to oil wells.
"We have CO2, pipelines and oil fields. So we have all the pieces," Rykhoek said.
Denbury has snapped up depleted oil wells at reasonable rates. It then works to revive them with CO2, which acts like a solvent.
While the old wells might be cheap, CO2 extraction is costly. High costs aren't a problem when oil prices top $100 a barrel — or even $60 a barrel. Rykhoek says Denbury breaks even when oil prices are as low as $30 to $35.
"We're making lots of money," he said.
Year-over-year profit gains rose to triple digits starting in last year's fourth quarter.
First-quarter earnings rose 144% to 39 cents a share from a year earlier. Denbury said the jump was due to higher oil prices and higher production levels.
Oil production from the tertiary deposits in the first quarter rose 46% over the earlier year, averaging 17,156 barrels of oil equivalent a day. Total production, including natural gas, rose 17% to 44,900 BOE a day.
Total revenue grew 82% from last year's comparable period to $317.3 million. In addition to CO2 production, the sum also included higher natural gas sales from the Barnett Shale around Fort Worth, Texas.
Executives say future expansion targets CO2 projects almost exclusively. The third of eight planned expansion phases just started in an area of Mississippi known as the Tinsley field.
"They're carving out their competitive (niche) in the Gulf Coast," said analyst Andrew Coleman of UBS Securities. "They plan to buy more oil fields and use CO2 to recover more oil from them."
Analysts tracked by Thomson Reuters estimate that full-year earnings will jump 62% from last year, to $1.80 a share, and rise 16% the next year.
Oil firms have used CO2 methods since the 1970s, especially in the Permian Basin of western Texas. But the practice fell off in the 1990s, when low oil prices made it unprofitable.
Denbury has been building its CO2 business since 2001, when it bought wells and a pipeline in the Jackson Dome that had essentially been sold off by Royal Dutch Shell (RDSA) to industrial firm Airgas. (ARG)
Before then, Denbury was a traditional exploration and production company.
Hundreds of mature oil fields in Denbury's target states of Mississippi, Louisiana and Texas are still ripe for Denbury's picking, Coleman says.
"They have not been flooded with CO2," he said. "Denbury is buying from anybody who has old fields."
The oil that Denbury coaxes out of mature wells happens to be high-quality light crude, which fetches the best prices.
"The oil that most people are producing nowadays is of a lower quality," Coleman said.
To get more CO2 supply to wells, Denbury plans to build a 300-mile pipeline to the Houston area. The $750 million project is expected to be completed in late 2009 or early 2010. Meanwhile, Denbury plans to drill five new CO2 source wells this year to raise production capacity and reserves.
It says it has enough existing projects and reserves to keep output growing for the next six years.
Then what? That's when things could get interesting.
"The bigger issue longer-term is assuring they have enough CO2," said Johnson Rice analyst Ken Carroll.
At some point, CO2 from natural underground sources might run its course. So Denbury is looking at ways to capture CO2 from man-made sources such as gas and chemical plants.
Since CO2 emitted into the air pollutes, Denbury's scheme would have the added benefit of reducing the greenhouse effect. It would swipe CO2 that otherwise would mess up the air and then pump it into the ground to free more oil.
"It's a beautiful trade-off," Coleman said.
Rykhoek says Denbury is talking to several interested parties in the Gulf region about gasification projects. "We would love to take their CO2," he said.
maybe DHX?
DHX woooohooooo
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