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NOV.4 - News for 'BEXP' - (US Energy Corp provides drilling results in Williston Basin of
North Dakota)
Nov 04, 2010 (Datamonitor via COMTEX) -- US Energy Corp., a natural resources
exploration and development company with interests in oil and gas, molybdenum,
geothermal, and real estate assets, has announced the initial production rate
from its Brad Olson 9-16 No 2H well which was recently completed with Brigham
Exploration Company in the Williston Basin of North Dakota, and provided an
update on its oil and gas drilling initiatives and leasing program in the
Williston Basin.
The Brad Olson 9-16 No 2H, the first Bakken infill well completed under the
Drilling Participation Agreement ("DPA") with Brigham, produced approximately
2,472 barrels of oil and 1.47 MMCF of natural gas per day or 2,717 BOE/D during
an early 24-hour initial flow back period. The well was completed with swell
packers and 32 fracture stimulation stages. US Energy's initial working interest
in this well is approximately 31%. Oil and gas sales from this well have
commenced.
The second infill well in the Brad Olson 9-16 unit, the Brad Olson 9-16 #3H
well, was also drilled late this summer in the same 1,280 acre spacing unit. US
Energy's initial working interest in this well is approximately 31%. It is
expected that this well will be completed in November of 2010.
During the completion of the Brad Olson 9-16 #2H well, the unit was monitored
with a micro-seismic array to evaluate the frac wing performance of the first
infill well in the unit. The resulting information will be used to determine
optimal spacing for the remaining well or wells in the unit, and could delineate
the potential to drill additional infill wells beyond the currently envisioned
three wells per formation, per spacing unit.
If results indicate that four to six wells may be required to effectively drain
the spacing units, which is yet to be determined, USE's drilling inventory could
increase to 120 to 180 total gross wells.
The remaining four initial wells under the DPA with Brigham are expected to be
drilled and completed during the fourth quarter of 2010.
URL: http://www.datamonitor.com
NOV. 3 News for 'BEXP' - (Global Hunter Lifts Target Price on Brigham Exploration to $29.50
(BEXP))
Nov 03, 2010 (SmarTrend News Watch via COMTEX) -- Global Hunter Securities
raised its price target on shares of Brigham Exploration (NASDAQ:BEXP) from $25
to $29.50 after the company topped production estimates combined with a larger
number of well which suggests increasing growth. Shares remain "Buy" rated.
The firm also raised its total year 2010 EPS and CFPS estimates from $0.42 and
$1.02 to $0.52 and $1.18, respectively.
Global Hunter based it upwardly revised PT on 27.3x 2010 EBITDA, 12.1x 2011
EBITDA, and 9.4x 2012 EBITDA.
SmarTrend is bullish on shares of Brigham Exploration and our subscribers were
alerted to buy on August 02, 2010 at $17.80. The stock has risen 19.8% since the
alert was issued.
Brigham Exploration is currently above its 50-day moving average (MA) of $18.53
and above its 200-day of $17.12.
In the last five trading sessions, the 50-day MA has climbed 2.45% while the
200-day MA has risen 1.08%.
NOV 1 News for 'BEXP' - (=DJ Brigham Exploration Swings To 3Q Loss On Hedging Losses)
=Loss $0.01 Cent per share
=Brigham Exploration Co Sees 4Q Avg Vol 10,200-10,800 Barrels
Of Oil Per Day
DOW JONES NEWSWIRES
Brigham Exploration Co. (BEXP) swung to a third-quarter loss on mark-to-market
losses and the early redemption of debt, although the oil-and-gas explorer posted
much higher production volumes of crude oil.
Core earnings for Brigham -- which explores primarily in the Anadarko Basin, the
Gulf Coast and West Texas -- topped Wall Street's expectations.
In each quarter of this year, revenue has jumped on much higher crude-oil
production volumes due to drilling activity in the Williston Basin, which is
located in Montana, the Dakotas and southern Canada. Since early August, Brigham
has expanded its acreage position there.
Brigham posted a loss of $676,000, or a penny a share, compared with a
year-earlier profit of $491,000, or a penny a share. Excluding the effect of
mark-to-market hedging and other impacts, per-share earnings rose to 15 cents from
breakeven a year ago. Revenue more than doubled to $44.4 million.
Analysts surveyed by Thomson Reuters expected a profit of 10 cents per share on
revenue of $44.7 million.
Total net production volumes of crude oil, which drives a bulk of the company's
revenue, more than doubled. Sales prices for crude oil improved 12%.
Shares fell 1.4% to $20.90 in after-hours trading. The stock was up 56% this year
as of Monday's close.
Thanks btrain, I am always networking and sharing information. Make my best investment decisions and deals based on that simple formula. I am new to ihub but posting DD and highlights for my own notes and to seek other feedback. We are also holding BEXP and are very bullish for oil in 2011. November is a bit of a wild card I can agree.
TurnKeyOil I think your postings are a great addition to this quiet board. Bullish on oil...you are not alone.
However, The first couple of weeks in November may be a cautious period. At this point, I can't interpret what the markets may be like, but it is being set up for something. I write a financial journal and have been getting a lot of conflicting data when looking ahead.
Just thought I'd mention it. As you may have guessed, I am a BEXP stock holder and bullish on commodities. But I'm not much of a board poster. Don't have much time for that.
Copper also just got a little bit more bullish today with the US copper pipe ruling. We'll hear about tariffs on imports and the IMF's "protectionism" is not productive dialog again.
My best regards,
btrain
We are very bullish BEXP here. I am using the board to post my DD for my notes hope you don't mind :)
We believe there is 30-40% upside to oil opportunities in 2011 when oil prices exceed triple digits again.
Excellent post TurnKey
Overview of Operational Results
Williston Basin
During the first quarter 2010, we had four operated rigs running in the Williston Basin. Three of the rigs were primarily drilling wells in our Rough Rider project area in Williams and McKenzie Counties, North Dakota; however, one of the operated rigs spent approximately one month drilling a well in our Ghost Rider project area in Roosevelt County, Montana. The fourth operated rig drilled wells in our Ross project area in Mountrail County, North Dakota. The following table summarizes our completions in the Williston Basin since year-end 2009.
Onshore Gulf Coast
Vicksburg Trend
In April, we successfully completed the drilling of the D.J. Sullivan State #16 in our Floyd Fault Block Field and anticipate completing the well in late May.
After completing the drilling of the D.J. Sullivan #16, we commenced drilling the D.J. Sullivan State #17, which is also located in our Floyd Fault Block Field.
Overview of First Quarter 2010 Financial Results
First quarter 2010 crude oil and natural gas prices, excluding realized and unrealized derivative hedging results, increased 112% and 41%, respectively, from that in the first quarter 2009. In the first quarter 2010, the average sales price that we received for crude oil, excluding realized and unrealized derivative hedging results, was $72.69 per barrel, which represents a $38.40 per barrel increase from the first quarter 2009. In the first quarter 2010, the average sales price that we received for natural gas, excluding realized and unrealized derivative hedging results, was $6.01 per Mcf, which represents a $1.74 per Mcf increase from that in the first quarter 2009.
Our first quarter 2010 production volumes were 5,420 barrels of equivalent per day, which represents a 1% increase from last year’s first quarter production volumes of 5,340 barrels of equivalent per day. Crude oil represented 66% of our production volumes in the first quarter 2010 as compared to 36% of our production volumes in the first quarter 2009. Both the increase in our production volumes and the increase in crude oil as a percent of total production volumes were as a result of our increased level of activity and successful drilling program in the Williston Basin targeting the Bakken and Three Forks. Our first quarter 2010 production volumes include approximately 5 MBoe in crude oil added to inventory during the quarter. Adjusting our first quarter 2010 production volumes for our increased level of inventory resulted in sales volumes of 5,364 barrels of equivalent per day in the first quarter 2010 versus sales volumes of 5,340 barrel of equivalent per day in the first quarter 2009.
Our first quarter 2010 crude oil revenue, including hedge settlements but excluding unrealized hedging gains and losses, were up $15.7 million, or 224%, compared to that in the first quarter 2009. Crude oil revenue increased $12.1 million due to higher sales prices and $4.8 million due to higher sales volumes. These increases were partially offset by a $1.2 million decrease in crude oil hedge settlements.
First quarter 2010 natural gas revenue, including hedge settlements but excluding unrealized hedging gains and losses, decreased $7.6 million from the first quarter 2009. Natural gas revenue decreased $3.6 million due to lower sales volumes and $5.8 million due to lower hedge settlements. These decreases were partially offset by the higher natural gas prices during the first quarter 2010 compared to those in the prior year’s quarter, which increased natural gas revenue by $1.8 million.
First quarter 2010 operating income was $13.1 million versus a $115.2 million operating loss in the first quarter last year. The increase in operating income was primarily attributable to the $114.8 million ceiling test write-down and $2.0 million inventory valuation write-down recorded in the first quarter 2009. Operating income also increased due to the increase in both commodity prices and our crude oil sales volumes. These increases to operating income were partially offset by lower natural gas sales volumes, higher lease operating, higher production taxes and higher general and administrative expenses.
As of March 31, 2010, we had $107.5 million in cash, cash equivalents and short term investments and $545.6 million in total assets.
8. Oil and Gas Properties
Brigham uses the full cost method of accounting for oil and gas properties. Under this method, all acquisition, exploration and development costs, including certain payroll, asset retirement costs, other internal costs, and interest incurred for the purpose of finding oil and natural gas reserves, are capitalized. Internal costs and capitalized interest are directly attributable to acquisition, exploration and development activities and do not include costs related to production, general corporate overhead or similar activities.
Capitalized costs of oil and natural gas properties, net of accumulated amortization, are limited to the present value (10% per annum discount rate) of estimated future net cash flow from proved oil and natural gas reserves, based on the oil and natural gas prices in effect on the balance sheet date including the impact of qualifying cash flow hedging instruments; plus the cost of properties not being amortized, if any; plus the lower of cost or estimated fair value of unproved properties included in the costs being amortized, if any; less related income tax effects. If net capitalized costs of oil and gas properties exceed this ceiling amount, Brigham is subject to a ceiling test write-down to the extent of such excess. A ceiling test write-down is a non-cash charge to earnings. If required, it would reduce earnings and impact stockholders’ equity in the period of occurrence and result in lower depreciation, depletion and amortization expense in future periods.
The risk that Brigham will experience a ceiling test write-down increases when oil and gas prices are depressed or if Brigham has substantial downward revisions in its estimated proved reserves. Based on oil and gas prices in effect at the end of March 2009 ($3.63 per MMBtu for Henry Hub gas and $49.65 per barrel for West Texas Intermediate oil, adjusted for differentials), the unamortized cost of Brigham’s oil and gas properties exceeded the ceiling limit by $71.9 million, net of tax. As a result, Brigham was required to record a write-down of the net capitalized costs of its oil and gas properties in the amount of $114.8 million at March 31, 2009.
Based on average oil and gas prices for the year ended March 31, 2010 ($3.99 per MMBtu for Henry Hub natural gas and $69.64 per barrel for West Texas Intermediate oil, adjusted for differentials), the unamortized cost of Brigham’s oil and gas properties did not exceed the ceiling limit. Therefore, Brigham was not required to writedown the net capitalized costs of its oil and gas properties at March 31, 2010.
Oct 25 News - Brigham Exploration Announces Third Quarter 2010 Earnings Conference Call
Posted on: Mon, 25 Oct 2010 16:15:07 EDT
Symbols: BEXP
AUSTIN, TX, Oct 25, 2010 (MARKETWIRE via COMTEX) --
Brigham Exploration Company (NASDAQ: BEXP | PowerRating) will hold its conference call to discuss operational and financial results for the third quarter 2010 on Tuesday, November 2, 2010 at 11:00 AM ET (10:00 AM CT).
Brigham plans to issue an earnings press release after the close of market trading on Monday, November 1, 2010. Participants are advised to dial in and register at least ten minutes prior to the call. Participants may pre-register for the call at https://cossprereg.btci.com/prereg/key.process?key=PVNELWLGV. Pre-registrants will be issued a pin number to use when dialing in to the live call which will provide quick access to the conference. Interested parties may also dial in using the instructions below, or visit Brigham's website for the live and archived webcast at http://www.bexp3d.com.
Details for the conference call are as follows:
Date & Time: Tuesday, November 2, 2010 11:00 AM ET (10:00 AM CT)
Host: Bud Brigham -- Chairman, CEO and President
Dial-In Number: 888.713.4218 within U.S. 617.213.4870 outside U.S.
Participant Passcode: 21582582
Telephone Replay Number: 888.286.8010 within U.S. 617.801.6888 outside U.S.
Telephone Replay Passcode: 42559492
Telephone Replay Available Through: November 9, 2010
Webcast Address: http://www.bexp3d.com
The webcast is also being distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at www.earnings.com. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents (www.streetevents.com).
ABOUT BRIGHAM EXPLORATION
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512.427.3444.
Contact:
Rob Roosa
Finance Manager
(512) 427-3300
You're welcome!
Perhaps I'm Unum E Pluribus --- (one out of many. It may not be good Latin, but it makes sense to me.)
Fred
HOD $20.11, Close at $19.99. Oct $17 Call up 61% @$2.50 a contract. Nice close for the day.
Thank you Koikaze. It looks like we will see the $20s pretty soon....
I haven't thanked you for your updates --- but I should have.
Thanks,
Fred
10/5-News: Brigham Exploration Announces State 36-1 #2H Rough Rider Three Forks Well Early Production Rate of 2,356 BOEPD, Three High Rate
Brigham Exploration Company (NASDAQ: BEXP) announced the completion of the State 36-1 #2H Rough Rider Three Forks well, its first Three Forks well west of the Nesson Anticline, at an early 24-hour peak flow back rate of approximately 2,356 barrels of oil equivalent. Brigham also announced three Bakken completions, including the Domaskin 30-31 #1H Ross project area well at an early 24-hour peak flow back rate of approximately 4,675 barrels of oil equivalent. As a result, Brigham has now completed 36 consecutive high frac stage long lateral Bakken and Three Forks wells in North Dakota with an average early 24-hour peak flow back rate of approximately 2,684 barrels of oil equivalent. In addition, Brigham announced the acquisition of additional leasehold covering approximately 10,200 net acres in the Williston Basin, approximately 7,600 of which is located in its core Rough Rider project area. Finally, Brigham provided an update on its drilling and completion activities in its core 205,600 net acres in the Williston Basin.
Rough Rider Three Forks High Rate Completion
In its Rough Rider project area in Williams County, North Dakota, Brigham announced the completion of the State 36-1 #2H Three Forks well, which was completed with 31 frac stages, at an early 24-hour peak flow back rate of approximately 2,356 barrels of oil equivalent (1,872 barrels of oil and 2.91 MMcf). The State 36-1 #2H represents Brigham's first Three Forks well completed west of the Nesson Anticline and based on publicly available information appears to represent a record Three Forks initial production rate west of the Nesson Anticline. The State 36-1 #2H represents Brigham's third Three Forks long lateral high frac stage completion. The two prior completions were east of the Nesson Anticline in Brigham's Ross project area and together averaged an early 24-hour peak flow back rate of 2,249 barrels of oil equivalent. Continued Three Forks success across its entire Rough Rider project area has the potential to add as many as 362 net drilling locations to Brigham's significantly de-risked development drilling inventory and could result in Brigham having an inventory of up to 933 net de-risked drilling locations within its current core acreage position. Brigham maintains an approximate 30% working interest in the State 36-1 #2H, which was completed with U.S. Energy Corp. (NASDAQ: USEG) as a working interest participant.
High Rate Ross Completion
In Mountrail County, North Dakota, Brigham announced the completion of the Domaskin 30-31 #1H, which was completed with 38 fracture stimulation stages, at an early 24-hour peak flow back rate of approximately 4,675 barrels of oil equivalent (4,106 barrels of oil and 3.42 MMcf). The Domaskin is located one mile to the west of the highest initial production rate Bakken well in the Williston Basin, the Brigham operated Sorenson 29-32 #1H, which was completed in April 2010 at an early 24-hour peak rate of 5,133 barrels of oil equivalent. Based on publicly available information, the Domaskin represents the fourth highest initial production rate Bakken well in the Williston Basin. Brigham has completed seven long lateral high frac stage Bakken wells in Ross at an average early 24-hour peak flow back rate of approximately 3,835 barrels of oil equivalent. Brigham maintains an approximate 65% working interest in the Domaskin. Also participating in the Domaskin is Lario Oil & Gas Company with a 12% working interest.
Acreage Acquisitions
Since early August 2010, Brigham has expanded its acreage position in the Williston Basin by approximately 10,200 net acres to an estimated 368,400 net acres. In its core Rough Rider project area, Brigham has expanded its acreage position by approximately 7,600 net acres, including a large acreage position obtained as a result of a transaction entered into with Zavanna, LLC. Inclusive of the acreage acquisitions, Brigham now has total core acreage of approximately 205,600 net acres.
Williston Basin Drilling and Completion Update
In its Rough Rider project area, Brigham announced the completion of the Larsen 3-10 #1H and the Boots 13-24 #1H Bakken wells, which produced at early 24-hour peak flow back rates of approximately 3,090 (2,631 barrels of oil and 2.75 MMcf) and 1,946 (1,773 barrels of oil and 1.04 MMcf) barrels of oil equivalent, respectively. The Larsen and Boots are located in Williams County and were both completed with 31 fracture stimulation stages. Brigham's working interests in the Larsen and Boots are approximately 72% and 74%, respectively. Brigham has completed 26 long lateral high frac stage Bakken wells in Rough Rider with an average early 24-hour peak rate of approximately 2,421 barrels of oil equivalent.
Brigham's accelerated development of its core operated acreage in its Rough Rider and Ross project areas is proceeding with four operated rigs drilling in Rough Rider and one operated rig drilling in Ross. Another operated rig is expected to arrive in early October and additional rigs are expected to arrive in January and May 2011, respectively, at which time Brigham will be continuously drilling with eight operated rigs.
Brigham currently has two wells fracing and nine wells waiting on completion. In the first quarter 2011, Brigham expects to add additional fracture stimulation capacity. At that time, Brigham estimates that approximately eight wells per month will be fracture stimulated and brought on line to production.
Management Comments
Bud Brigham, the Chairman, President and CEO, commented, "We're extremely excited by the results from our State 36-1 #2H Rough Rider Three Forks well. This well has generated an apparent record early 24-hour production rate for a Three Forks well west of the Nesson Anticline, and begins to potentially de-risk as many as 362 net Rough Rider Three Forks drilling locations. Combining our 571 drilling locations that are already significantly de-risked with as many as 362 net Rough Rider Three Forks drilling locations could result in our de-risked drilling inventory growing to up to 933 potential net locations. We believe success in the Three Forks in our Rough Rider project area represents a significant net asset valuation accretion event for our stockholders and other stakeholders."
Bud Brigham continued, "Our staff continues to manufacture oil wells on our current core acreage and deliver exceptional results. We've now completed 36 consecutive high frac stage long lateral Bakken and Three Forks wells in North Dakota with an average early 24-hour peak production rate of approximately 2,684 barrels of oil equivalent. Furthermore, with our Domaskin completion, we now have three of the four highest initial production rate Bakken wells in the Williston Basin."
Bud Brigham continued, "The results from our four recently completed wells should have a significant positive effect on our fourth quarter 2010 production volumes and our year-end proved reserves. In addition, our production volumes and proved reserves should be further enhanced by our two additional wells that are currently fracing, one of which is located in our Ross project area proximate to our record Bakken wells."
Bud Brigham concluded, "Our land department continues to actively acquire quality acreage in and adjacent to our core areas at attractive costs. We closed on an additional large acreage acquisition in Rough Rider representing approximately 6,000 net acres, all of which is core, and a significant portion of which is held by production. We believe that our track record of 36 consecutive strong producers provides us with a competitive advantage while leasing and we hope to continue to capitalize on that advantage."
Contact:
Rob Roosa
Finance Manager
(512) 427-3300
Sept. 27 News - Brigham Exploration Company Announces Results to Date of Tender Offer and Receipt of Requisite Consents
Date : 09/27/2010 @ 7:30AM
Source : MarketWire
Stock : Brigham Exploration (BEXP)
Brigham Exploration Company (NASDAQ: BEXP) announced today the results to date of the previously announced cash tender offer and consent solicitation (the "Offer") for any and all of its $160 million outstanding principal amount of 9 5/8% senior notes due 2014 (CUSIP No. 109178AB9) (the "Notes") and receipt of the requisite consents to adopt the proposed amendments to the indenture governing the Notes. As of 5:00 p.m., New York City time, on September 24, 2010 (the "Consent Date"), which was the deadline for holders to tender their Notes in order to receive the consent payment in connection with the Offer, tenders and consents had been received from holders of $154.4 million in aggregate principal amount of the Notes, representing approximately 96.5% of the outstanding Notes.
Accordingly, based on the receipt of the consents, Brigham intends to execute a supplemental indenture (the "Supplemental Indenture") to the indenture governing the Notes to eliminate substantially all of the restrictive covenants and certain events of default and to shorten the redemption notice period from 30 days to three days. The Supplemental Indenture will not become operative until Brigham purchases a majority in aggregate principal amount of the outstanding Notes pursuant to the terms of the Offer, which is expected to occur later today, September 27, 2010. The Supplemental Indenture will thereafter be binding on the holders of Notes not purchased in the Offer.
Brigham's obligation to accept for purchase, and to pay for, any Notes pursuant to the Offer is subject to a number of conditions that are set forth in the Offer to Purchase and Consent Solicitation Statement dated September 13, 2010 (the "Offer to Purchase"), including the closing of Brigham's previously announced public offering of $300 million of its 8.750% Senior Notes due 2018 which is expected to occur today. Subject to the satisfaction or waiver of these conditions, all Holders who validly tendered (and did not validly withdraw) their Notes prior to the Consent Date will receive total consideration equal to $1,052.00 per $1,000 principal amount of the Notes, which includes a consent payment of $30.00 per $1,000 principal amount of the Notes, plus accrued and unpaid interest on the Notes up to, but not including, the payment date.
In accordance with the terms of the Offer, withdrawal rights with respect to the tendered Notes expired at 5:00 p.m., New York City time, on September 24, 2010 (the "Withdrawal Deadline"). Accordingly, holders may not withdraw Notes previously or hereafter tendered, except as required by law.
Holders who tender (and do not validly withdraw) their Notes after the Consent Date and prior to the expiration of the Offer, will be entitled to receive consideration equal to $1,022.00 per $1,000 principal amount of the Notes, plus any accrued and unpaid interest on the Notes up to, but not including, the payment date. Holders of Notes tendered after the Consent Date will not receive a consent payment. The tender offer will expire at 11:59 p.m., New York City time on October 8, 2010, unless extended or earlier terminated.
If the conditions set forth in the Offer are met and Brigham accepts the Notes tendered by the Consent Date, Brigham intends to call for redemption on October 8, 2010, all Notes that remain outstanding after the consummation of the Offer at a redemption price of $1,048.13 per $1,000 principal amount of Notes, plus accrued and unpaid interest up to, but not including, the redemption date.
The complete terms and conditions of the Offer are described in the Offer to Purchase, copies of which may be obtained from i-Deal LLC, the information agent for the Offer, at (877) 746-3583 (U.S. toll-free) or (201) 499-3500 (collect).
Brigham has engaged Credit Suisse and BofA Merrill Lynch to act as the dealer managers and solicitation agents in connection with the Offer. Questions regarding the Offer may be directed to Credit Suisse Securities (USA) LLC, Liability Management Group, at (800) 820-1653 (U.S. toll-free) and (212) 325-5912 (collect) or BofA Merrill Lynch, Liability Management Group, at (888) 292-0070 (U.S. toll-free) and (980) 388-9217 (collect).
This announcement is not an offer to purchase, a solicitation of an offer to purchase or a solicitation of consents with respect to any securities. The Offer is being made solely by the Offer to Purchase and Consent Solicitation Statement dated September 13, 2010.
About Brigham Exploration
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
Contact:
Rob Roosa
Finance Manager
(512) 427-3300
9/1 News-Analyst Upgrade target $20/Share
DJ PRICE TARGET CHANGES:
Friedman, Billings & Ramsey issued the following share price target changes on Tuesday:
Company Name Symbol New Trg Old Trg Current Time Span
Bingham Exploration BEXP $20.00 $15.00 $15.32 12 Months
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8/31 News-Oil & Gas 360™ Interviews From EnerCom's The Oil & Gas Conference® 15
EnerCom, Inc. (www.enercominc.com) today announced its industry news and views website Oil & Gas 360™ (www.oilandgas360.com) conducted eight interviews of company executives who presented during EnerCom's The Oil & Gas Conference® 15. The five-day conference assembled 92 companies who presented their unique stories to investors, research analysts, and investment professionals in Denver, Colo.
Oil & Gas 360™ conducted interviews during the conference to ask key presenters follow-up questions to discuss the increasing importance the industry has on shaping the world's economic future. The following companies and executives were interviewed:
* Ben M. "Bud" Brigham, Chairman, Chief Executive Officer and President – Brigham Exploration Company (Nasdaq: BEXP)
* David M. Demshur, Chairman of Supervisory Board, Chief Executive Officer and President – Core Laboratories (NYSE: CLB)
* Stephen C. Jumper, Chief Executive Officer and President – Dawson Geophysical (Nasdaq: DWSN)
* Richard W. McCullough, Chairman, Chief Executive Officer and President – PDC Energy (Nasdaq: PETD)
* David E. Preng, Founder and President – Preng & Associates
* Albert L. Reese, Jr., Chief Financial Officer, Treasurer – ATP Oil & Gas (Nasdaq: ATPG)
* John D. Schiller, Jr., Chairman and Chief Executive Officer – Energy XXI (Nasdaq: EXXI)
* Jeffrey L. Ventura, President and Chief Operating Officer – Range Resources Corporation (NYSE: RRC)
The interviews are posted on interviews
About Oil & Gas 360™
Oil & Gas 360™ is a one-stop source of news, information and analysis from the professionals at EnerCom, Inc. The website is dedicated to all things oil and gas: people, technologies, transactions, trends, macro-economic analysis that impacts commodity prices, views and interviews, profiles and Catalyst™ reports. The goal with Oil & Gas 360™ is to be a trusted source of information and analysis for portfolio managers, equity research analysts, private equity capital providers, private investors, oil and gas executives and professionals, and government officials involved in the oil and gas industry.
About EnerCom
Founded in 1994, EnerCom, Inc. is a nationally recognized investor communications consultancy firm advising and serving energy-centric clients on corporate strategy, investor relations targeting, media and corporate communications, visual communications design, and analysis. The Company's professionals have more than 220 years of industry and business experience and a proven track record of success. EnerCom, Inc. uses the team approach for delivering its wide range of services to public and private companies large and small, operating in the global exploration and production, drilling, OilService, and associated advanced-technology industries. The Company annually hosts three oil and gas investment conferences:
* The Oil and Gas Conference® 15 – Denver, Colorado – August 22 – 26, 2010 www.theoilandgasconference.com
* The Oil and Services Conference™ IX – San Francisco, California – February 23 – 24, 2011 www.theoilandservicesconference.com
* EnerCom's London Oil and Gas Conference™ 3 – London, England – June 16, 2011 http://www.enercomlogc.com
You can now follow EnerCom, Inc. on Twitter at www.twitter.com/enercominc.
For more information about EnerCom and its services, please call: Brian Brooks, at +303-296-8834 or visit www.enercominc.com.
We started selloff yesterday at 3 PM and looks like we're continuing this morning.
EARNINGS NEWS - Aug 03, 2010 16:39 ET
http://www.marketwire.com/press-release/Brigham-Exploration-Reports-Record-Quarterly-Production-Volumes-Second-Quarter-2010-NASDAQ-BEXP-1299478.htm
Brigham Exploration Reports Record Quarterly Production Volumes, Second Quarter 2010 Results and Updates 2010 Forecasts and Cap-Ex Budget
AUSTIN, TX--(Marketwire - August 3, 2010) - Brigham Exploration Company (NASDAQ: BEXP) today announced record quarterly production volumes and its financial results for the second quarter and six months ended June 30, 2010.
SECOND QUARTER 2010 RESULTS
Our average daily production volumes for the second quarter 2010 were a quarterly record 7,756 barrels of crude oil equivalent (Boe) per day, up 71% from the second quarter 2009 and up 43% from the first quarter 2010. Our previous record quarterly production volumes of 7,709 Boe per day were achieved in the second quarter 2007 and reflected production contributions from several of our high rate Southern Louisiana natural gas wells.
Benefiting from both our operated and non-operated drilling activity in the Williston Basin, our crude oil production volumes for the second quarter 2010 averaged 5,584 barrels per day, which represents a 206% increase from that in the second quarter 2009 and a 57% sequential increase from that in the first quarter 2010. Our crude oil production volumes represented 72% of our total production volumes in the second quarter 2010 as compared to 40% in the second quarter 2009 and 66% in the first quarter 2010.
Our production volumes in the Williston Basin for the second quarter 2010 were 5,526 Boe per day, which represents a 334% increase from that in the second quarter 2009 and a 71% sequential increase from that in the first quarter 2010.
Our second quarter production volumes included approximately 5,089 barrels of crude oil produced during the quarter and added to inventory. Adjusting our production volumes for amounts included in inventory resulted in second quarter 2010 daily sales volumes of 7,700 Boe per day.
Revenues from the sale of crude oil and natural gas, including hedge settlements for the second quarter 2010, were up 186% to $41.4 million as compared to that in the second quarter 2009. Higher crude oil sales volumes and crude oil prices increased revenues by $16.5 million and $9.8 million, respectively. Higher natural gas prices increased revenues by $2.0 million while lower natural gas sales volumes decreased revenues by $1.0 million. Finally, lower hedge settlements reduced revenues by $0.4 million.
During the second quarter 2010, our average realized price for crude oil was $68.93 per barrel, which included a $0.26 per barrel loss due to the cash settlement of our crude oil derivative contracts. This compares to an average realized price in the second quarter 2009 of $48.06 per barrel, which included a $1.35 per barrel cash loss due to the settlement of our crude oil derivative contracts. Our average realized price for natural gas in the second quarter 2010 was $6.08 per Mcf, which included a $0.84 per Mcf cash gain associated with the settlement of our natural gas derivative contracts. This compares to an average realized price in the second quarter 2009 of $4.53 per Mcf, which included a $1.03 per Mcf cash gain due to the settlement of our natural gas derivative contracts.
Our second quarter 2010 production costs, which include costs for operating and maintaining (O&M expense) our producing wells, expensed workovers, ad valorem taxes and production taxes, were up $1.13 per Boe when compared to those in the second quarter 2009. The increase was largely driven by a $3.59 per Boe increase in production taxes, which was driven by higher commodity prices and higher levels of production in North Dakota, which are subject to an 11.5% tax rate. Expensed workovers increased $0.80 per Boe, with the majority of the increase due to several workovers of our conventional Gulf Coast and Anadarko Basin natural gas wells. The increases in production taxes and expensed workovers were partially offset by a $2.96 per Boe decrease in O&M expense due primarily to our higher production volumes.
Our general and administrative (G&A) expenses for the second quarter 2010 increased $0.4 million compared to the second quarter 2009 primarily because of an increase in employee compensation costs, which was partially associated with increased level of employee bonuses and bonus accruals as we re-instated our performance bonus plan in 2010 after suspending the plan in 2009.
Our depletion expense for the second quarter 2010 was $14.2 million ($20.56 per Boe) compared to $6.2 million ($15.30 per Boe) in the second quarter 2009. Our higher sales volumes increased depletion expense by $4.4 million and our higher depletion rate increased depletion expense by $3.6 million.
Our net interest expense for the second quarter 2010 decreased $1.3 million from the second quarter 2009. This decrease was primarily due to the repayment of our Senior Credit Facility as a result of our October 2009 equity offering.
We recorded no income tax expense in either the second quarter 2010 or the second quarter 2009, as we are reversing our deferred tax asset valuation allowance against deferred income tax expense.
Our reported net income for the second quarter 2010 was $18.5 million ($0.16 per diluted share) versus net income (loss) of ($7.0) million (($0.12) per diluted share) for the same period last year. Our after-tax earnings in the second quarter 2010 excluding unrealized mark-to-market hedging gains were $15.0 million ($0.13 per diluted share) as compared to our after-tax earnings (loss) in the second quarter 2009 excluding unrealized mark-to-market hedging losses and the non-cash write-down of the carrying value of our inventory were ($2.8) million (($0.05) per diluted share). After-tax earnings excluding the above items is a non-GAAP measure and a reconciliation of GAAP net income to after-tax earnings excluding the above items is included in our accompanying financial tables found later in this release.
In the second quarter, 2010, we spent $92.4 million in exploration and development capital expenditures. Exploration and development and total oil and gas capital expenditures for the second quarter 2010 and 2009 were:
Three months ended June 30,
------------------------------
2010 2009
-------------- --------------
(in thousands)
Drilling $ 71,324 $ 3,552
Net land and G&G 21,062 784
-------------- --------------
Exploration and development capital
expenditures $ 92,386 $ 4,336
Capitalized costs 4,405 2,923
Capitalized FAS 143 ARO 205 103
-------------- --------------
Total oil and gas capital expenditures $ 96,996 $ 7,362
============== ==============
FIRST SIX MONTHS 2010 RESULTS
Our average daily production volumes for the first six months of 2010 were 6,588 barrels of crude oil equivalent (Boe) per day, up 34% from that in the first six months of 2009. Benefiting from both our operated and non-operated drilling activity in the Williston Basin, our crude oil production volumes for the first six months of 2010 averaged 4,568 barrels per day, which represents a 144% increase from that in the first six months of 2009. Our crude oil production volumes represented 69% of our total production volumes in the first six months of 2010 as compared to 38% in the first six months of 2009.
Our production volumes in the Williston Basin for the first six months of 2010 were 4,379 Boe per day, which represents a 240% increase from that in the first six months of 2009.
Our first six months of 2010 production volumes included approximately 10,101 barrels of crude oil produced and added to inventory during the period. Adjusting our production volumes for amounts included in inventory results in average first six months of 2010 daily sales volumes of 6,532 Boe per day.
Revenues from the sale of crude oil and natural gas including hedge settlements for the first six months of 2010 were up 98% to $70.9 million as compared to that in the first six months of 2009. Higher crude oil commodity prices and crude oil sales volumes increased revenues by $23.5 million and $19.8 million. Higher natural gas prices increased revenues by $3.6 million while lower natural gas sales volumes decreased revenues by $4.4 million. Lower hedge settlements reduced revenues by $7.4 million.
During the first six months of 2010, our average realized price for crude oil was $70.27 per barrel, which included a $0.28 per barrel loss due to the cash settlement of our crude oil derivative contracts. This compares to an average realized price in the first six months of 2009 of $44.18 per barrel, which included a $2.55 per barrel cash gain due to the settlement of our crude oil derivative contracts. Our average realized price for natural gas in the first six months of 2010 was $6.36 per Mcf, which included a $0.77 per Mcf cash gain associated with the settlement of our natural gas derivative contracts. This compares to an average realized price in the first six months of 2009 of $6.33 per Mcf, which included a $2.40 per Mcf cash gain due to the settlement of our natural gas derivative contracts.
Our production costs for the first six months of 2010 were up $2.73 per Boe when compared to those in the corresponding period last year. The increase was largely driven by a $3.59 per Boe increase in production taxes, which was driven by higher commodity prices and higher levels of production in North Dakota, which are subject to an 11.5% tax rate. Expensed workovers increased $1.10 per Boe, with the majority of the increase due to several workovers of our conventional Gulf Coast and Anadarko Basin natural gas wells. The increases in production taxes and expensed workovers were partially offset by a $1.79 per Boe decrease in O&M expense due primarily to our higher production volumes.
Our G&A expenses for the first six months of 2010 increased $1.4 million compared to those in the corresponding period last year primarily because of an increase in employee compensation costs, which was partially associated with increased levels of employee bonuses and bonus accruals as we re-instated our performance bonus plan in 2010 after suspending the plan in 2009.
Our depletion expense for the first six months of 2010 was $23.5 million ($19.95 per Boe) versus $16.1 million ($18.12 per Boe) in the first six months of 2009. Our higher sales volumes increased depletion expense by $5.2 million and higher depletion rate increased depletion expense by $2.1 million.
Our net interest expense for the first six months of 2010 decreased $2.5 million from the corresponding period last year. This decrease was primarily due to the repayment of our Senior Credit Facility as a result of our October 2009 equity offering.
We recorded no income tax expense in either the first six months of 2010 or the corresponding period last year, as we are reversing our deferred tax asset valuation allowance against deferred income tax expense.
Our reported net income for the first six months of 2010 was $29.8 million ($0.27 per diluted share) versus net income (loss) of ($126.0) million (($2.39) per diluted share) for the same period last year. Our after-tax earnings in the first six months of 2010 excluding unrealized mark-to-market hedging gains were $23.2 million ($0.21 per diluted share) as compared to our after-tax earnings (loss) in the first six months of 2009 excluding the effect of our first quarter 2009 ceiling test write-down, unrealized mark-to-market hedging losses, and $2.2 million non-cash write-down of the carrying value of our inventory were ($2.2) million (($0.04) per diluted share). After-tax earnings excluding the above items is a non-GAAP measure and a reconciliation of GAAP net income to after-tax earnings excluding the above items is included in our accompanying financial tables found later in this release.
Through June 30, 2010, we spent $144.5 million in exploration and development capital expenditures. Exploration and development and total oil and gas capital expenditures for the first six months of 2010 and 2009 were:
Six months ended June 30,
-----------------------------
2010 2009
-------------- -------------
(in thousands)
Drilling $ 114,930 $ 26,492
Net land and G&G 29,539 (5,687)
-------------- -------------
Exploration and development capital
expenditures $ 144,469 $ 20,805
Capitalized costs 8,974 5,663
Capitalized FAS 143 ARO 257 275
-------------- -------------
Total oil and gas capital expenditures $ 153,700 $ 26,743
============== =============
THIRD AND FOURTH QUARTER 2010 FORECASTS
The following forecasts and estimates for the third quarter and fourth quarter 2010 are forward-looking statements subject to the risks and uncertainties identified in the "Forward-Looking Statements Disclosure" at the end of this release.
We are forecasting that our third quarter 2010 total production volumes to average between 7,900 Boe per day and 8,400 Boe per day and that our crude oil volumes will comprise approximately 72% of our total third quarter production volumes. We are forecasting that our fourth quarter 2010 total production volumes to average between 9,500 Boe per day and 10,500 Boe per day and that our crude oil volumes will comprise approximately 74% of our total fourth quarter production volumes.
For the third quarter 2010, lease operating expenses are projected to be $6.63 per Boe based on the mid-point of our production guidance, production taxes are projected to be approximately 9.5 to 10.0% of pre-hedge crude oil and natural gas revenues, and general and administrative expenses are projected to be $2.9 million ($3.93 per Boe).
UPDATED 2010 EXPLORATION AND DEVELOPMENT BUDGET
Our updated 2010 exploration and development capital budget will fund approximately 37.8 net Williston Basin wells, two net Vicksburg wells in South Texas and 3.5 net wells primarily in the West Texas Wolfberry oil resource play. Included in the updated budget are capital expenditures associated with four transactions and organic leasing to acquire Williston Basin acreage totaling approximately 52,800 net acres. Our updated 2010 exploration and development capital budget is as follows:
(in millions)
-----------------
Drilling $ 275.5
Field level infrastructure 32.8
Land and seismic 41.8
Acreage acquisitions 53.9
------------
Exploration and development capital expenditures $ 404.0
MANAGEMENT COMMENTS
Gene Shepherd, Brigham's Chief Financial Officer, commented, "During the second quarter, the further acceleration in our horizontal Bakken and Three Forks drilling program led to record production volumes, which was the primary factor contributing to our record financial performance for the quarter. Furthermore, we ended the second quarter with $333 million of cash, cash equivalents and investments on the balance sheet and an undrawn credit facility. When combined with our growing cash flow and expanded hedging program, this level of liquidity ensures the company's ability to continue to fund the ramp up in our Bakken and Three Forks drilling program that we have been building to for the last several years, ensuring a strong level of operational performance for the second half of 2010."
Gene Shepherd continued, "The $110 million increase in our 2010 budget takes our exploration and development capital expenditures to $404 million. We are very excited about the fact that roughly $69 million or 62% of the cap-ex increase will fund the acquisition of additional Williston Basin acreage primarily in our Rough Rider project area. The fact that roughly 34,000 or 64% of the 52,800 net acres acquired is located in our core, de-risked project areas makes our recently completed second quarter, given these acreage acquisitions in combination with our operational successes, a period of significant net asset value growth for our shareholders."
CONFERENCE CALL INFORMATION
Our management will host a conference call to discuss operational and financial results for the second quarter 2010 with investors, analysts and other interested parties on Wednesday, August 4, at 11:00 a.m. Eastern Time. To participate in the call, participants within the U.S. please dial 888-713-4211 and participants outside the U.S. please dial 617-213-4864. The participant passcode for the call is 48199177. Participants may pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=P8W9TULAA. Pre-registrants will be issued a pin number to use when dialing into the live call which will provide quick access to the conference. A telephone recording of the conference call will be available approximately two hours after the call is completed through 12:00 p.m. Eastern Time on Wednesday, August 11, 2010. To access the recording, domestic callers dial 888-286-8010 and international callers dial 617-801-6888. The passcode for the conference call playback is 86879958. In addition, a live and archived web cast of the conference call will be available over the Internet at either www.bexp3d.com or www.streetevents.com.
A copy of this press release and other financial and statistical information about the periods covered by this press release and by the conference call that will take place on Wednesday, August 4, 2010, will be available on our website. To access the press release, go to www.bexp3d.com, click on Investor Relations and then click on News Releases. The file with a copy of the press release is named Brigham Exploration Reports Second Quarter 2010 Results and is dated Tuesday, August 3, 2010. To access the other financial and statistical information that will be covered by the conference call that will take place on Wednesday, August 4, 2010, go to www.bexp3d.com, click on Investor Relations and then click on Event Calendar. The file with the other financial and statistical information is named Financial and Statistical Information for the Second Quarter 2010 Conference Call and is dated Tuesday, August 3, 2010.
ABOUT BRIGHAM EXPLORATION
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
Tuesday, August 3, 2010 News Release - Brigham Exploration Announces Approximate 52,800 Net Acre Expansion in Its Williston Basin Acreage Position, Initial Montana Bak
http://ih.advfn.com/p.php?pid=nmona&article=43863511&symbol=BEXP
Since late April 2010, Brigham Exploration Company (NASDAQ: BEXP) has expanded its acreage position in the Williston Basin by approximately 52,800 net acres to an estimated 358,200 net acres, which represents a 17% increase in its total Williston Basin acreage. Importantly, Brigham has expanded its core acreage position by an estimated 34,000 net acres, primarily in and around its Rough Rider project area, to a total of approximately 198,400 net acres. Brigham also announced the completion of the Rogney 17-8 #1H, its first Bakken well in its Eastern Montana project area in Roosevelt County, Montana, at an early 24-hour peak flow back rate of 909 barrels of oil equivalent. Finally, Brigham announced the completion of the Michael Owan 26-35 #1H and the Sedlacek Trust 33-4 #1 at early 24-hour peak flow back rates of 2,931 and 2,695 barrels of oil equivalent, respectively.
Growth in Williston Basin Acreage
In addition to its ongoing organic leasing efforts, Brigham completed four separate acreage acquisition transactions, expanding its Williston Basin acreage position by approximately 52,800 net acres since late April to an estimated 358,200 net acres. Approximately 23,800 net acres were added to its Rough Rider project area in Williams and McKenzie County, North Dakota. In addition, approximately 9,900 net acres were added in far eastern Richland County, Montana, very proximate to Brigham's Sedlacek Trust well, which had an early 24-hour peak rate of 2,695 barrels of oil equivalent. As a result, Brigham's core acreage position west of the Nesson Anticline in Rough Rider and in far Eastern Montana has grown by approximately 27% to an estimated 156,700 net acres. An additional 300 net acres were added east of the Nesson Anticline in the Ross project area in Mountrail County, North Dakota. Together, this represents an increase of 34,000 net acres in its core acreage in the Williston Basin to approximately 198,400 total net core acres. As a result of these acreage additions, Brigham has increased its core acreage drilling locations by an estimated 81 net locations to approximately 574 total net locations.
Separate from the aforementioned core acreage additions in far eastern Richland County, Montana, Brigham added approximately 17,300 additional acres in its Eastern Montana project area further west from the Sedlacek Trust well in Richland County. The remaining 1,500 net acres acquired in Eastern Montana are located in Roosevelt County.
Initial Brigham Operated and Non-Operated Montana Bakken Discoveries
Brigham announced the completion of its operated Rogney 17-8 #1H in its Eastern Montana project area in Roosevelt County at an early 24-hour peak rate of approximately 909 barrels of oil equivalent. Given that this was Brigham's initial test in the area, the initial nine frac stages, or approximately 30% of the horizontal wellbore, were stimulated at lower frac pump rates. However, as a consequence the well produced at low initial flow rates. Brigham subsequently treated the remaining 21 frac intervals at higher frac pump rates and, when commingled with the initial nine intervals, the well produced 909 barrels of oil equivalent in an early 24 hour period. Currently the Rogney is flowing at a rate of approximately 400 barrels of oil equivalent per day.
Also in Montana and approximately 17 miles southeast of the Rogney, Brigham participated with a small working interest in the Zenergy Luke Sweetman, which was completed with 23 frac stages. The Luke Sweetman commenced production in late April at an early 24-hour peak rate of approximately 1,201 barrels of oil equivalent per day, after 100 days had produced roughly 30,000 barrels of oil and was recently producing approximately 320 barrels of oil equivalent per day. Brigham will continue to monitor the performance of the Rogney and other surrounding wells, and plans on spudding its next Montana operated well, the Gobbs 17-8, approximately five miles east of the Rogney in November.
Update on Accelerating North Dakota Bakken and Three Forks Operational Activity
Brigham announced the completion of its operated Michael Owan and Sedlacek Trust wells at early 24 hour peak flow back rates of 2,931 (2,640 Bopd and 1.75 MMcf/d) and 2,695 (2,413 Bopd and 1.69 MMcf/d) barrels of oil equivalent, respectively. Both wells are located in Brigham's Rough Rider project area. Notably, the Sedlacek Trust represents the southwestern most well to date of Brigham's acreage in its Rough Rider project area. The Michael Owan and Sedlacek Trust were treated with 33 and 30 frac stages, respectively. Brigham maintains an approximate 87% interest in the Michael Owan and an approximate 48% working interest in the Sedlacek Trust. The Sedlacek Trust was completed with U.S. Energy Corp. (NASDAQ: USEG) as well #10 under the terms of the 15 well Drilling Participation Agreement entered into last year. Brigham's interest in the wells drilled with U.S. Energy Corp. will increase after payout.
Brigham's accelerated development of its core operated acreage in its Rough Rider and Ross project areas is proceeding with five operated rigs drilling, four of which are located in Rough Rider with an additional rig located in Ross. The next operated rig is expected to arrive October 1st and is expected to drill wells in the Ross project area. Additional operated rigs are expected to arrive in January and May 2011 after which Brigham will have eight operated rigs running in the Williston Basin. In terms of operated well completions, one well is currently flowing back after frac, one well is fracing and nine wells are waiting on completion.
Access to an incremental 50% of a frac crew is expected this month and at that time the pace of Brigham operated completions is expected to accelerate. In December 2010 or January 2011, Brigham is expected to gain access to an additional 50% of a frac crew and at that time Brigham will have two fully dedicated crews fracing Brigham operated wells at all times.
Brigham is also actively constructing infrastructure in both the Rough Rider and Ross project areas. In Rough Rider, crude oil, water disposal and fresh water pipelines are being laid. It is expected that Brigham will lay approximately 70 miles of each of these lines. All lines are anticipated to be operational by the second quarter 2011. Additionally, a pipe yard is currently under construction and a water disposal well will be drilled in the near future, both near Williston, North Dakota. In Ross, water disposal lines are being laid, a water disposal well has been drilled and the disposal facility is being constructed. It's expected that the water disposal system will be operational in the next 60 days.
Management Comments
Bud Brigham, the Chairman, President and CEO, commented, "Our Land Department exceeded all expectations by delivering approximately 52,800 net Williston Basin acres to our stockholders, an estimated 34,000 of which are in our core areas, since our last acreage update in April. This acreage was delivered at an average cost of approximately $1,000 per acre, which represents a substantial discount to the per acre cost of a recent industry merger transaction in the Williston Basin and represents a significant net asset value creation event. In total, we estimate that 81 net drilling locations were added to our de-risked core drilling inventory. Our successful long lateral high frac stage drilling formula has delivered 28 consecutive high production rate North Dakota Bakken and Three Forks wells at an average early 24-hour peak rate of 2,659 barrels of oil equivalent. We believe these results have made us an operator of choice in the Rough Rider project area and have assisted in our ability to close meaningful acreage transactions over a two month period."
Bud Brigham continued, "Inclusive of our Rogney test, we now have three apparent Bakken discoveries proximal to our largest acreage block in our Eastern Montana project area. Apparently EOG has completed and is producing the Carat well immediately offsetting our acreage to the north. In addition, the Zenergy Luke Sweetman well, in which we have a small working interest, has now produced for approximately 100 days and is providing encouraging early performance to the southeast. Furthermore, well spacing activity has increased significantly in Eastern Montana with 78 units applied for by other operators at the June and August spacing hearings. The vast majority of these units are just east and north of our acreage block. We've learned a great deal from the Rogney that we will benefit from in our subsequent drilling. The initial nine frac stages were pumped at lower frac rates, reducing the productivity of that portion of the stimulation. The remaining 21 frac stages produced much better results relative to the initial nine stages. We'll of course continue to evaluate the core results of the Rogney and monitor the well's performance, and very much look forward to commencing our second operated test during the fourth quarter."
Bud Brigham continued, "Exciting activity is underway in Rough Rider with our first Three Forks well and first Bakken infill well drilling ahead. Our Three Forks well is being drilled in the same unit as our State 36-1 Bakken well, which commenced production in January 2010 at an initial rate of approximately 3,807 barrels of oil equivalent per day. Success with the State 36-1 Three Forks well would complement third party operated Three Forks discoveries proximal to Rough Rider and potentially further de-risk approximately 344 net Three Forks locations in Rough Rider. Additionally, we are currently drilling our first Bakken infill well in our Brad Olson 9-16 spacing unit and will deploy a micro seismic array to monitor the propagation of our frac wings. Monitoring frac wing performance could enable us to better understand the ultimate number of locations that are available to fully develop each spacing unit. As we have kept the amount of proppant placed in the formation for each well constant while increasing the number of frac stages, it's likely we have more effectively stimulated the near well bore area, while reducing the length of our frac wings. If we are more effectively stimulating the near well bore area, we may have the opportunity to drill more than the currently envisioned three wells per spacing unit."
About Brigham Exploration
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
BEXP Earnings Call Aug 4th, Earnings News Aug 3rd after market Close.
Press Release Source: Brigham Exploration On Thursday July 15, 2010, 8:00 am EDT
AUSTIN, TX--(Marketwire - 07/15/10) - Brigham Exploration Company (NASDAQ:BEXP - News) will hold its conference call to discuss operational and financial results for the second quarter 2010 on Wednesday, August 4, 2010 at 11:00 AM ET (10:00 AM CT).
Brigham plans to issue an earnings press release after the close of market trading on Tuesday, August 3, 2010. Participants are advised to dial in and register at least ten minutes prior to the call. Participants may pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=P8W9TULAA. Pre-registrants will be issued a pin number to use when dialing in to the live call which will provide quick access to the conference. Interested parties may also dial in using the instructions below, or visit Brigham's website for the live and archived webcast at http://www.bexp3d.com.
Details for the conference call are as follows:
Date & Time: Wednesday, August 4, 2010
11:00 AM ET (10:00 AM CT)
Bud Brigham -- Chairman, CEO and
Host: President
Dial-In Number: 888.713.4211 within U.S.
617.213.4864 outside U.S.
Participant Passcode: 48199177
Telephone Replay Number: 888.286.8010 within U.S.
617.801.6888 outside U.S.
Telephone Replay Passcode: 86879958
Telephone Replay Available Through: August 11, 2010
Webcast Address: http://www.bexp3d.com
The webcast is also being distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at www.earnings.com. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents (www.streetevents.com).
BEXP received a Market Perform rating, and is moving up with the oil and market.
Today,s chart looks promising here at $16.65.
DOE report may cause a slight decline today...
DOE: US Crude Oil Stocks +0.36M Bbl In Wk; Seen -1.3M Bbl
US Gasoline Stocks +1.118M Bbl In Wk; Seen +0.7M Bbl
US Distillate Stocks +3.935M Bbl In Wk; Seen +1.6M Bbl
US Refineries Ran At 91.5% Vs 90.5% Week Ago
BEXP to attend EnerCom, Inc. to Host The Oil & Gas Conference(R) 15 on August 22-26, 2010
Crude up to: 76.89
Today's Support and Resistance Points:
BEXP 7-Jul-10 Pivot Points, Fib Pivots and Camarilla
R3 16.97 Fib R3 16.46 Brk Out Long 16.35
R2 16.47 Fib R2 16.18 Short 16.14
R1 16.20 Fib R1 15.99 HL2 16.07
Pivot 15.70 Pivot 15.70 HL1 16.00
S1 15.43 Fib S1 15.41 LL1 15.86
Crude inventories declined, current Price: $74.64
Crude declined down from $75.84 after fuel stocks report indicated less demand for crude ahead.
BEXPs close was a strong indication that we may may break through the $16 barrier this week. Only 3.4 million shares, but we are up 7% on the day. The Oct future Option Call at $17 is up 36.36% a contract, at $1.50. If the trend line continues, and oil continues its move up into August highs this could prove to be a good investment again. All the fundamentals and performance are in place for a record year ahead.
It is critical that we move back up into our 100DMA trend line.
Chart:
JULY 7- news Brigham Exploration Raised To Mkt Outperform From Mkt Perform By Howard Weil >BEXP
Crude now $73.13
The daily chart is up more than 7% this morning. It appears we are moving into the first resistance areas.
BEXP 2-Jul-10 Pivot Points, Fib Pivots and Camarilla
R3 16.81 Fib R3 16.24 Brk Out Long 15.50
R2 16.25 Fib R2 15.76 Short 15.14
R1 15.52 Fib R1 15.45 HL2 15.03
Pivot 14.96 Pivot 14.96 HL1 14.91
S1 14.23 Fib S1 14.47 LL1 14.67
S2 13.67 Fib S2 14.16 LL2 14.55
S3 12.94 Fib S3 13.68 Long 14.44
Brk Out Short 14.08
With destruction in the Gulf and a unrealistic call to end off shore drilling, we'll see more calls for onshore drilling. And any company involved will skyrocket... especially in the oil-rich Bakken area — one of the largest continuous oil accumulations ever assessed in the United States.
Even if the moratorium is gone, investors are likely to come back to on shore drilling stocks... which makes Oasis Petroleum (OAS) even more attractive.
This company has 292,000 net acres under lease prospective in the Bakken and Three Forks areas.
And it already had proved reserves of 13.3 million barrels of oil equivalent (BOE) a day by close of 2009 — and average daily production of 3,295 BOE per day in the first quarter of 2010.
Onshore drilling is where smart investors will look to put their money as the Gulf continues to lap oily waves onto its beaches... and beyond.
Stay Ahead of the Curve,
Ian L. Cooper
Energy and Capital
TER: With the uncertainty in the Gulf, do you see a shift to onshore exploration?
SDP: Every oil company would like to have a steady production base, and if you can't get that offshore, because projects might not start on time or might not get developed or you're going to get a start/stop production profile, then investors really don't like that. What they like is steady production, and that comes from onshore, where you can actually manage drilling programs and deploy rigs on schedule. Onshore gives you the power to create your own destiny. I mean, the Bakken Shale has been really the number one spot to be. A lot of the merit of the Bakken Shale has already been priced into Bakken stocks, but there's even more value being placed on the onshore because it's one of the only places where companies can go in the U.S. and really envision growing oil production.
http://seekingalpha.com/article/208042-opportunities-in-oil-as-a-result-of-the-gulf-spill
3-Mar-10 BRIGHAM BEN M
Officer 212,500 Indirect Sale at $17.52 per share. $3,723,000
3-Mar-10 BRIGHAM BEN M
Officer 62,500 Direct Sale at $17.52 per share. $1,095,000
This stock goes from 2 bucks to 20 bucks in a year and nobody is on this?
WTF?
Covered this at $14.35 for a loss of 9.5% Had it been an actual pairs trade with USEG (i.e., had I bought USEG when I shorted BEXP and sold it when I covered), that pairs trade would have gone for a 1.6% loss. I actually bought USEG a year and a half ago, at about $2.80, and continue to hold it. More details: http://shadowstocks.com/62-that-didnt-work
Shorted BEXP today at $13.11. Sort of a pairs trade, as I already own USEG. More details on my blog: http://shadowstocks.com/49-new-short-position-bexp
BEXP should be moving much higher on this NEWS, and more wells being drilled means the good news should keep on coming in.
Jan 5th 2010
Brigham Exploration Announces State 36-1 #1H Bakken Well Produces at Initial Rate of Approximately 3,807 BOEPD
http://phx.corporate-ir.net/phoenix.zhtml?c=99916&p=irol-newsArticle&ID=1371059&highlight=
Dec 14 2009
Brigham Exploration Announces Williston 25-36 #1H Bakken Well Produces at Initial Rate of Approximately 3,394 BOEPD
http://phx.corporate-ir.net/phoenix.zhtml?c=99916&p=irol-newsArticle&ID=1365737&highlight=
Brigham shares surge on higher oil volumes
Austin Business Journal
Brigham Exploration Co said late Monday it expects oil volumes to increase in the third quarter and cash flows to stay strong.
That announcement, coupled with positive results at its Figaro well in the Bakken shale in North Dakota, sent Brigham's shares up 16 percent on Tuesday to $7.58.
Last week the Austin-based oil and gas company signed an agreement with U.S. Energy Corp. to increase drilling in some of its holdings in the Bakken shale before the leases expire. Figaro is located in McKenzie County, N.D. The well has produced about 1,895 barrels of oil equivalent per day during its early peak 24-hour period, the company said.
Brigham (Nasdaq: BEXP) shares closed at $6.55 Monday but were trading around $7.58 mid-morning Tuesday. The stock has traded in the range of $1.04 to $14.50 over the last 52 weeks.
During the second quarter, Brigham made $9.6 million on revenue of $10.5 million. In 2008, the company made $112.7 million on revenue of $127.8 million. Brigham has roughly 70 total employees.
http://austin.bizjournals.com/austin/stories/2009/08/31/daily12.html?ana=yfcpc
The Bakken boom is still young, so much so that local restaurants are having a hard time hiring new staff due to the sudden surge in demand for youthful laborers. One company, Whiting Petroleum (WLL), has dug three successful wells at Lake Robinson, the third of which is producing 2,530 b/d -- 53% more than the second. Whiting plans to drill at least 30 wells this year alone. Jefferies analyst Biju Perincheril says shares ($57) are worth $66, and that's before assigning a value to Lake Robinson.
"The newness of the [Bakken] play has analysts giving credence only to acreage that has been drilled successfully," portfolio manager David Morehead says. "We do not believe the street has fully valued the Bakken drilling that has already been permitted, let alone the Bakken acreage held in portfolios that has yet to be permitted and drilled."
Other companies with operations in the area include EOG Resources (EOG) [11% of its assets leveraged to the area]; Brigham Exploration (BEXP) [16%]; and Continental Resources (CLR) [33%]. Marathon Oil (MRO) is also moving aggressively into the region
Clarium Makes Huge Play on Oil Services
http://seekingalpha.com/article/146753-clarium-makes-huge-play-on-oil-services
Brigham Exploration Announces 2,021 Boepd Three Forks Well and Provides Williston Basin Update
Brigham Exploration Company (NASDAQ:BEXP - News) announced that the Strobeck 27-34 #1H produced approximately 2,021 barrels of oil equivalent per day from the Three Forks formation during its early 24 hour flow back period. Brigham also provided an update on its operated and non-operated drilling activity in the Williston Basin.
Ross Area, Mountrail County, North Dakota
Strobeck 27-34 #1H Three Forks Completion -- Brigham announced that the Strobeck 27-34 was successfully fractured stimulated and produced approximately 1,788 barrels of oil and 1.4 MMcf of natural gas, or 2,021 barrels of oil equivalent, from the Three Forks formation during its early 24 hour flow back period. The long lateral Strobeck 27-34 was completed with 20 fracture stimulation stages, 18 of which were effectively stimulated. The Strobeck 27-34 appears to represent the second highest initial rate for a Three Forks completion in the Williston Basin behind only the XTO Boucher 41X-21, which produced a reported 2,571 barrels of oil equivalent during its initial 24 hour flow back period. Brigham maintains an approximate 77% working interest and 63% net revenue interest in the Strobeck 27-34.
Anderson 28-33 #1H Bakken Completion -- Brigham recently drilled the lateral of its Anderson 28-33 to a total depth of 19,900 feet, and successfully ran 24 swell packers to bottom in the two section long lateral. Brigham expects to commence the fracture stimulation of 24 stages in the Bakken formation in early August. The Anderson is also located in the Ross Area and is approximately 1 mile west of the Strobeck, and roughly one mile southwest of Brigham's Carkuff 22 #1H Bakken producer. Brigham's Carkuff 22 #1H commenced production at approximately 1,110 barrels of oil per day after the stimulation of 12 frac intervals in a single section short lateral. Brigham maintains an approximate 66% working interest and 55% net revenue interest in the Anderson 28-33.
The Strobeck 27-34 #1H and Anderson 28-33 #1H are located in Brigham's Ross Area where the company controls approximately 35,200 net acres. Assuming two Bakken and two Three Forks wells per 1280 acre drilling unit, Brigham could potentially develop 110 net wells over its Ross Area acreage.
Rough Rider Area, Williams and McKenzie Counties, North Dakota
Figaro 29-32 #1H Bakken Completion -- Brigham will fracture stimulate the Figaro 29-32 from the Bakken formation later this month. It's anticipated that the long lateral well will be completed with approximately 20 fracture stimulation stages. The Figaro 29-32 is located in McKenzie County, North Dakota approximately 5 miles to the northeast of the Mracheck 15-22 #1H. The Mracheck 15-22 #1H was a short lateral Bakken well completed with 7 fracture stimulation stages and produced at an early 24 hour rate of approximately 727 barrels of equivalent per day. Brigham maintains an approximate 95% working interest and 75% net revenue interest in the Figaro 29-32.
Olson 10-15 #1H Offset -- Brigham has commenced drilling operations on the Brad Olson 9-16 #1H and will drill the long lateral to a total depth of approximately 20,000 feet. The Brad Olson 9-16 #1H is planned to be completed with 24 fracture stimulation stages in the Bakken formation. The well is located in Williams County, North Dakota and is approximately one-half mile to the west of Brigham's successful Olson 10-15 #1H. The Olson 10-15 #1H was also a long lateral and produced at an early 24 hour rate of approximately 1,433 barrels of oil equivalent per day after the stimulation of 20 frac stages. Brigham anticipates maintaining an approximate 94% working interest and 74% net revenue interest in the Brad Olson 9-16 #1H.
The Figaro 29-32 #1H and Brad Olson 9-16 #1H are located in Brigham's Rough Rider Area where the company currently controls approximately 100,345 net acres. Assuming two Bakken wells per 1280 acre drilling unit, Brigham could potentially develop up to 157 net Bakken wells in its Rough Rider area. With additional success in the Three Forks and also assuming two wells per 1280 acre drilling unit, a total of up to 314 net wells could be drilled in the Rough Rider area for full development of both objectives.
Non-Operated Williston Basin Activity
The following table summarizes Brigham's non-operated activity (all wells target the Bakken formation unless otherwise noted):
�
OPERATOR WELL NAME COUNTY LOCATION ~ WI STATUS
EOG Resources Austin 11-1H Mountrail 154-90-01 0.78% Fracing
EOG Resources Austin 23-32H Mountrail 154-90-32 0.70% Waiting on
Completion
EOG Resources Austin 3-4H Mountrail 154-90-4 3.12% Producing - IP
1,866 Boepd
EOG Resources Burke 14-17H Mountrail 155-90-17 3.13% Producing - IP
1,062 Boepd
EOG Resources Burke 17-23H Mountrail 155-90-23 7.73% Fracing
EOG Resources Burke 21-30H Mountrail 155-90-30 4.75% Producing - IP
363 Boepd
EOG Resources Burke 5-5H Mountrail 155-90-05 1.17% Producing - IP
639 Boepd
EOG Resources Parshall Mountrail 152-90-31 3.42% Drilling
15-31H
EOG Resources Pederson Mountrail 153-90-33 0.39% Producing - IP
1-33H 1,686 Boepd
EOG Resources Wayzetta Mountrail 153-90-05 3.12% Producing - IP
15-05H 1,265 Boepd
Fidelity Fladeland Mountrail 154-92-14 6.29% Fracing
Exploration 44-31H
Fidelity Moen 23-14H Mountrail 155-91-1423 6.25% Producing - IP
Exploration 432 Bopd
Hess EN-Hermanson Mountrail 154-93-2 1.17% Producing - IP
247 Boepd
Hess RS State H Mountrail 157-90-16 0.26% Waiting on
Completion
Murex Clifford Gene Mountrail 154-91-0112 2.05% Producing - IP
Petroleum #1-12H 1,350 Bopd
Slawson Mamba #1-20H Mountrail 152-91-20 2.54% Producing - IP
506 Boepd
Whiting Carkuff Mountrail 154-92-11 3.15% Drilling
#11-12H
Whiting TTT Ranch Mountrail 153-91-6 4.96% Producing - IP
#11-6H 3,102 Boepd
Windsor Weflen 1-4H Mountrail 153-90-04 10.93% Waiting on
Energy Completion
Group
XTO Moe State Mountrail 155-95-36 0.39% Producing - IP
31X-36(Three 401 Bopd
Forks)
Bud Brigham, the Chairman, President and CEO, stated, "We're extremely excited about the Strobeck 27-34. The well's strong performance further validates the well by well improvement we are generating by increasing the number of fracture stimulation stages. The Strobeck 27-34 results also confirm the core taken from our Anderson 28-33, which indicated that both the upper Three Forks and middle Bakken formations were heavily saturated with oil. Also in the Ross Area, we're looking forward to the results of our Anderson 28-33 completion, which we believe will be the first well completed in the basin with 24 attempted frac stages. Given the strong production generated by our short lateral 12 frac stage Carkuff 22 #1H in the same area, we have high expectations for this well. The approximate 110 net Three Forks and Bakken wells that we could drill to develop the Ross Area, which is only a relatively small portion of our approximate 290,000 net acres in the Williston Basin, represent a significant potential net asset value creation opportunity for our shareholders."
Bud Brigham continued, "These results further illustrate that our company is at the forefront of technological development in the core of the Williston Basin Bakken and Three Forks plays. We continue to experience improved production and economic performance with our operational advancements, particularly as we've increased the number of fracture stimulation stages. Other companies are following our lead, and we therefore expect initial production rates and estimated ultimate recoveries to continue to improve."
Bud Brigham concluded, "Importantly, we also continue to see reductions in drilling and completion costs, which will further enhance the economics of the Williston Basin. We completed our Strobeck 27-34 with 20 frac stages at a cost of approximately $3.9 million, down approximately 33% from that of our AFE's late in 2008. We currently estimate the cost to drill and complete our Brad Olson 9-16 #1H, long lateral well with 24 fracture stimulation stages, at $6.25 million, down roughly 34% relative to last year's AFE's. The reduced costs, combined with moderated differentials, bode well for the long-term economics of the basin."
Drilling with Charlie – Blizzard in the Badlands
by Charlie Brister
Published May 25 2009 by ASPO-USA
http://www.energybulletin.net/node/49016
[Note: a true story from the oil fields. You may have burned some of the associated gasoline.]
I am no longer in the directional drilling business due to the industry downturn. Since many of us will not be returning to the oil fields, those who have this experience will be fewer in number, and the demands on their time will be great.
My work with horizontal drilling began in 1995 in the Williston Basin. Previously I had been a “mudlogger” in the Gulf of Mexico and onshore Gulf Coast, working primarily vertical wells, then directional wells from fixed platforms. Eventually I became a lead well-site geological consultant.
In the Williston, we worked the Cedar Hills Anticline in Bowman County, North Dakota. An anticline is a gentle uplifting structure that provides the classic oil trap in geological textbooks. This anticline was the training ground for many who would later use their skills in the famous Bakken Shale play. Our target zone was “Red River B” formation--a 10-foot-thick, oil-bearing layer 9000 feet underground; only the top three feet was the “sweet spot”--the best producer. This layer consisted of a fine micro-crystalline, dark brown dolomite that looks like brown sugar. “Sucrosic” describes how it appears under a microscope. As we drilled wells south along the anticline, problems always popped up, hence the nickname “Aggravation Acres.”
Some wells are memorable. One for the books was the “Eagon”, named after the rancher on whose land it was drilled. The area around the Cedar Hills Anticline is known for the Badlands that were created when the area uplifted. The Hell Creek formation outcrops in this area; it is famous for the Triceratops, T-Rex and other dinosaur fossils found in the area. During the Indian Wars, a U.S. General quipped that the area was “like hell with the fires put out”.
I arrived in early April after a 10-hour drive from Colorado, looking for a derrick among the panoramic buttes. The few cottonwood trees along the coulées were still bare, as spring comes late to North Dakota. I found Rig 52, drove on site and checked in at the “Company Man's” trailer. The first sensation on a rig is the sound and vibration of the multiple engines that power it. The generators and power plants are loud and starkly contrast to the peaceful surroundings.
The Eagon was a re-entry well, meaning that it had been drilled previously and we were going to try to correct what had been done before. I reviewed the log history. After some 9000 vertical feet of cased well, the first horizontal leg had been drilled and they were in “search” mode within the pay zone, with the wellbore drifting up and down, when they hit a problem. They pulled back to near the end of the well casing and drilled a new wellbore. They used the first lateral as a “roadmap.” About 2500 feet into the second horizontal leg, they lost the formation again and decided to drill down. At that point they had a failure, and in an attempt to pull out of the hole they got stuck, accidently twisted off and then abandoned the Bottom Hole Assembly (= expensive equipment). In a word, let me assure you that this well had trouble written all over it.
We drilled the cement plug that had capped the old well. At first things went pretty well. My logging equipment allowed me to see the amounts and types of hydrocarbons encountered. The tools allowed me to describe rock cuttings that were flushed to the surface by the drilling fluid. We calculated the “lag time” from when the bit cut the rock until it would reach the surface; that told us the depth from which those cuttings were coming up. In the case of the Eagon, at the start it took about 45 minutes. We were getting good “shows” of oil.
So how do you know where you are, in a well bore, relative to the thickness of the pay zone layer? After a couple hundred feet out horizontally, we steer the Bottom Hole Assembly (with drill bit) slightly upwards. The Measurement-While-Drilling surveys indicates the wellbore’s angle is at 91 degrees from the vertical. The anhydrite “roof” of the target zone is encountered, and a slowdown is noted. At this point, the bit is tilted a bit down, dropping lower into the zone. The survey should note that you now are at 89 degrees, or less than 90 degrees (90 = horizontal). Keep in mind that this is not the angle at the bit but typically 45 feet or so behind the bit; it is kind of like driving a car forward while looking in the rear view mirror. This maneuver should produce a “top strike” that can be seen in the rock cuttings or gamma log. A few hundred feet further out we do this again, producing another top strike. Using geometry and knowing the True Vertical Depth (TVD) of the two top strikes, a dip angle of the formation can be calculated. In a perfect world, the formation could be projected the mile or so out that the lateral would be drilled. But the earth’s formations are complex; they may be up-dip for a distance, then “roll over” and down-dip, then go up-dip again.
While we kept drilling, it started raining Friday evening, April 4, 1997. Soon the temperature dropped and rain turned to snow, falling about 2 inches per hour. Then the Dakotas wind kicked up to about 60 miles an hour; by 10:00 p.m., we were in a full-fledged blizzard. Come morning, snow had drifted over the pipe racks and packed against the trailers, completely covering the Company Man's trailer. He called over the handheld radio, “Guys, the roads are all closed and drifted over. No one can get in or out of here. There’s no relief crew until roads are cleared, and I have no idea how long that will be. The wind is blowing too hard to send the derrick man up to trip out [pull the pipe out of the well], so we can either come off bottom and circulate [fluids only, no rock] or we can try to drill ahead as long as we can.” There was a pause as the crew chewed it over in the “doghouse.” Finally, the driller called back. “We’ll drill ahead.”
Had the Toolpusher (rig supervisor) been on location, there may have been a different decision, but. he had gone to town on Friday night and was missing in action. The risk was that by drilling ahead, should anyone get hurt, there was zero chance of getting an ambulance to the rig. The crew had already worked their 12-hour shift and were now facing an indefinite schedule. They came from the local area and had only brought enough food for the one shift. The Company Man came back on the radio, “All right, we will drill as long as we can. Let’s gather up whatever food we have on location and start splitting it up. We may be here a while.”
While the storm raged, we were 9,000 feet deep and 2000 feet horizontal. During slight letups in the blizzard, I staggered from the logging shack to the shale shaker to grab rock cuttings for analysis. As we drilled, I drew a “graphical log” showing our progress. We were about 2 feet beneath the top of the formation. At about 2500 horizontal feet the penetration rate slowed; that normally indicated another top strike into the “roof” above the pay zone. I radioed the Company Man: “I think we better [steer the bit] down here. I may be wrong but this is where they screwed up the first time.” At the time, and on most horizontal drilling operations today, decisions are made at the well-site. Several companies have tried drilling from the office or by committee and have met with limited success. Maybe someday, but it wasn't practical then.
An hour later, the cuttings arrived at the surface (lag time increases as you drill further) from the earlier slowdown in penetration rate. Pure limestone. No sucrosic dolomite visible whatsoever. We had drilled through a fault, and were either in the upper or lower limestone. Now we were again, as the others before us, searching for the pay zone…with an exhausted crew.
By Saturday afternoon, the rig crew had been working 24 hours straight—double the normal shift. They were catching naps as best they could, with the driller and derrick man changing out on the brake handle from time to time. The Company Man was also acting as directional driller and was trapped in his trailer under 10 foot snowdrifts, but sat in a lounge chair with a radio call waking him up about every hour to make a decision, after getting data, on where to steer.
I trudged from the logging unit over to our living trailer, which we shared with the MWD hand, Steve, who had set up his equipment there. Steve had terminal cancer, though we didn’t know it at the time. In hindsight, that explained some of his strange behavior. He constantly watched religious programming and made comments like, “These are the End Times.” As the wind sounded like it was going to shred the shack, Steve sat staring at the satellite TV that was down. Snow blew in cracks around windows as he stared on, mumbling something about “the wrath of God”. I ate my sandwich and shook my head. Then we heard the radio crackle, “Hey – anybody got any drinking water? We're out.” Steve and I looked around the shack and found about a half gallon--barely enough to make one pot of coffee. Coffee was the juice these guys were running on. We began melting snow, but it took hours to make enough for just a few pots.
We continued to drill down through the Red River Limestone when, once again, the penetration rate slowed. I radioed the Company Man, “I think we need to pick up and circulate out for samples to find out what this is.” “Not a problem,” he responded, “Maybe the boys can get an hour nap.” At that point--Saturday evening--they had been working about 36 hours. The driller began working the pipe up and down, taking steps to prevent anything getting stuck in the well. A little over an hour later, I trudged through the snow, grabbed a cutting sample, and scoped it. Fine white particles of anhydrite were visible. We were approaching the “roof” of the Red River B zone. I called the Company Man, “Let's keep going down.” We drilled at a slower rate as we penetrated the thin anhydrite section, then the drilling rate increased from 20 feet to 80 feet per hour. “Zone!” At almost 3000 feet lateral, we had drilled through a fault, turned the bit down and had re-entered our production zone. Now we were trying to recover and level out in the zone without drilling past it. An hour later, we got confirmation that we were still in the pay zone.
By Monday morning, the winds let up and the sun broke through. The snow was about 3 feet deep with drifts up to 10 feet. One of the hands called out on the radio: “Hey there's somebody walking, about a mile over there!” We sent out our skid loader and recovered the mystery man; it was our Toolpusher, Mike, who had gone missing Friday night. He had driven off the road into a coulee, then had left his truck and made it to a nearby rancher's home. Since it was early April and calving season, the rancher brought the newborn calves into the home to try to keep them alive. “Hannah” was one of the most brutal springtime blizzards in modern history, killing over 100,000 head of cattle in the Dakotas. As the snow melted, its runoff flooded the Red River Valley, including Grand Forks. Mike had spent his time helping the rancher keep his calves alive. Later that day, the roads were cleared and our relief crew finally arrived, honking their horns as they drove in. At this point, we had worked 66 hours straight. As darkness fell, the relief crew began tripping out to change the bit that had managed to last through the ordeal, both above and below the surface. These men would, a few years later, become Toolpushers themselves and would become the workforce that would discover and exploit the Bakken Shale. The “Red River B” formation was estimated to contain about 120 million barrels of oil, but after about 10 years of development, it annually supplies less than a week of U.S. oil consumption.
Later that night, my night hand man Dave and I drove two miles west of the rig and stopped. The lights of Rig 52 were behind us. We wanted to see Comet Hale Bopp, then at its closest approach in its orbit. I stood there in the still, cold North Dakota night and saw Hale Bopp brightly visible above the Cretaceous age buttes that held the bones of dinosaurs. For a moment I could sense the passing of time, from when those animals roamed the earth and how we ourselves, and maybe our entire civilization, are here for only an instant. After a moment of reflection, we returned to Rig 52 and would successfully finish the unforgettable Eagon well.
Charlie Brister has spent over three decades working in various arms of the energy sector: oil, utilities, solar, and residential energy. After his layoff, he’s migrating back into the latter realm.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Brigham Exploration Announces Frio Discovery, Provides Operational Update and Announces Execution of Williston Basin Mineral Sale Agreement
Tuesday March 31, 2009, 4:15 pm EDT
AUSTIN, TX--(MARKET WIRE)--Mar 31, 2009 -- Brigham Exploration Company (NasdaqGS:BEXP - News) announced production testing of the G.S. Harrison Unit #2 at a rate of 3.0 MMcfe per day, provided an update on well performance in the Williston Basin and announced the execution of the sales agreement for its mineral interests in the Williston Basin for $6 million.
G.S. Harrison Unit #2 -- Brigham has successfully production tested its G.S. Harrison Unit #2 at rate of approximately 3.0 MMcfe per day from the lowest pay interval in the primary Frio objective, which is now commencing production to sales. Brigham owns an approximate 63% working interest and an approximate 47% net revenue interest in the well. The G.S. Harrison Unit #2 is located in Matagorda County, Texas and encountered approximately 61 feet of net pay in the upper and lower target sands. The well was perforated and fractured stimulated from 20 feet of net pay in the lower sands, with the upper 41 feet of apparent net pay remaining behind pipe for completion at a later date. Other interest owners in the well include Panhandle Oil and Gas Inc. (NYSE:PHX - News), with a 12.5% working and 9.5% revenue interest.
Williston Basin Operations Update -- West of the Nesson Anticline in Williams County, North Dakota, Brigham has successfully placed the Olson 10-15 #1H on rod pump at a current rate of approximately 573 barrels of oil and 430 Mcf of natural gas per day. Brigham owns an approximate 100% working interest and 79% net revenue interest in the well.
In Sheridan County, Montana Brigham successfully brought on line the Friedrich Trust 31 #1 at an early rate of 200 barrels of oil per day on March 17th, and the well was recently producing approximately 145 barrels of oil per day. Brigham owns an approximate 77% working interest and 59% net revenue interest in the well. The Friedrich Trust represents the third consecutive Red River discovery utilizing 3-D seismic stratigraphic attributes to identify reservoirs.
Williston Basin Mineral Interest Sale -- Brigham has executed the sales agreement on the $6 million sale of approximately 3,122 net mineral interest acres. The sale is effective March 1, 2009 and will close by April 15, 2009.
Bud Brigham, the Chairman, President and CEO, stated, "We're excited about our most recent discovery along the onshore Gulf Coast, the G.S. Harrison Unit #2. This is a nice PDP reserve addition which will fully impact our second quarter production volumes."
Bud Brigham continued, "We also continue to be impressed by the very strong performance of our Olson 10-15 #1H, which was drilled in our approximate 105,000 net acres west of the Nesson Anticline in North Dakota. Based on its early performance, it's easily the best well we've drilled in the Bakken and Three Forks play, significantly outperforming even our best Mountrail County wells. The Olson has already produced over 28,000 barrels of oil since coming on line just over two months ago, illustrating the substantial improvement in well performance and economics we're experiencing in the play as we and other operators continually innovate. Given our recent results and, since year end, the combination of the rebound in oil prices, the decline in Williston Basin differentials and the significant decline in service costs, the economics of drilling Bakken and Three Forks wells appear very attractive today. We expect further improvement in drilling economics as we move through 2009."
Bud Brigham stated, "We're pleased to have executed the sales agreement for our mineral interest in the Williston Basin. The execution of the agreement represents the completion of the first step in the process we outlined in the fourth quarter conference call to generate additional liquidity so as to be in position to take advantage of an improving operating environment."
Gene Shepherd, Executive Vice President and Chief Financial Officer, stated, "We are progressing on the other initiatives discussed in our year end conference call. We continue to evaluate the potential sale of our non-operated Mountrail County acreage in the Parshall / Austin / Sanish Fields and the potential sale of a portion of our leasehold in our remaining Williston Basin acreage. We are also taking steps to reduce our general and administrative costs, including reducing executive officer salaries by 25%. Furthermore, we've monetized a number of our high value 2009 natural gas costless collars, generating an incremental $3.2 million in cash, and simultaneously replacing such collars with swaps at the current market."
Brigham Exploration Reports Year End and Fourth Quarter 2008 Results
AUSTIN, TX, Mar 11, 2009 (MARKET WIRE via COMTEX) -- Brigham Exploration Company (NASDAQ: BEXP) today announced financial results for the year-ended and quarter-ended December 31, 2008.
YEAR END 2008 RESULTS
Revenues from the sale of oil and natural gas including hedge settlements for 2008 were $121.5 million, which represents a 3% decrease when compared to last year. Lower production volumes and hedge settlements decreased revenue by $20.4 million and $7.8 million, respectively, while higher prices increased revenue by $25.0 million. Average daily equivalent production volumes for 2008 were 31.8 MMcfe per day, down 23% when compared to those for 2007. Despite the fact that our overall equivalent volumes were down for the year, our oil volumes increased by 47% as we expanded both our operated and non-operated drilling activity in the Williston Basin.
Our average realized price for natural gas in 2008 was $9.08 per Mcf, which included a $0.13 per Mcf loss associated with the settlement of our natural gas derivative contracts. This compares to an average realized price in 2007 of $7.66 per Mcf, which included a $0.36 per Mcf gain due to the settlement of our natural gas derivative contracts. Our average realized price for oil for 2008 was $84.63 per barrel, which included a $4.43 per barrel loss due to the settlement of our oil derivative contracts. This compares to an average realized price in 2007 of $71.51, which included a $0.79 per barrel loss due to the settlement of oil derivative contracts last year.
Our production costs per Mcfe, which include costs for operating and maintaining our producing wells (O&M expense), expensed workovers, ad valorem taxes and production taxes, increased 76%, or by $0.67 per Mcfe, when compared to 2007. Production taxes increased by $0.30 per Mcfe, due to a $2.7 million decrease in high cost gas production tax abatements received in 2008 as compared to 2007. O&M expenses increased by $0.28 per Mcfe, primarily due to increases in salt water disposal, compressor rental, and fuel costs. Workover costs increased by $0.09 per Mcfe, due to an increase in the number and cost of workovers. Ad valorem taxes were in-line with 2007.
Our general and administrative (G&A) expenses rose by 3% in 2008 versus 2007 as higher contract and professional fees, office costs and franchise taxes were mostly offset by lower employee bonuses.
Our depletion expense for 2008 was $53.5 million ($4.67 per Mcfe) compared to $59.1 million ($3.94 per Mcfe) in 2007. Our decreased production volumes reduced depletion expense by $13.9 million while our higher depletion rate increased depletion expense by $8.3 million in 2008. The increase in our depletion rate was a result of an increase in the cost of reserve additions.
In 2008, we recorded a $237.2 million non-cash ceiling test impairment charge ($148.6 million after-tax) on our oil and gas properties. A ceiling test impairment is recorded when the capitalized cost of our oil and gas properties exceeds the present value (10% per annum discount rate) of estimated future net cash flows based on commodity prices at the end of the reporting period plus certain unevaluated property costs. Commodity spot prices as of December 31, 2008 for Henry Hub natural gas and West Texas intermediate crude oil were $5.71 per Mcf and $44.60 per barrel.
Our net interest expense for 2008 was 1% lower than last year. The primary driver behind the decrease in our interest expense was higher capitalized interest expense associated with our higher level of drilling activity. Our weighted average debt outstanding for 2008 was $220.1 million versus $189.1 million in 2007.
We recorded a deferred income tax benefit of $42.7 million in 2008 compared to a deferred income tax expense of $6.7 million in 2007. The deferred income tax benefit primarily resulted from our $237.2 million ceiling test writedown.
Our reported net income (loss) for 2008 was ($162.2) million (($3.57) per diluted share) versus net income of $10.2 million ($0.22 per diluted share) for the same period last year. Our after-tax earnings in 2008 excluding the effect of our unrealized derivative gains and ceiling test impairment charge were $15.4 million ($0.33 per diluted share), while our after-tax earnings in 2007 excluding the effect of our unrealized derivative losses and ceiling test impairment charge were $17.9 million ($0.39 per diluted share). After-tax earnings excluding the above items is a non-GAAP measure and a reconciliation of GAAP net income to after-tax earnings excluding the above items is included in our accompanying financial tables found later in this release.
As of December 31, 2008, we had $40.0 million in cash and $145.0 million of debt outstanding under our senior credit facility.
In 2008, we spent $185.3 million on oil and gas capital expenditures, which represents a 47% increase from 2007. Oil and gas capital expenditures for 2008 and 2007 were:
Year Ended December 31,
-----------------------
2008 2007
----------- -----------
(in thousands)
Drilling $ 136,248 $ 96,833
Net land and seismic 35,796 17,527
Capitalized costs 12,852 11,631
Capitalized SFAS 143 ARO 412 325
----------- -----------
Total oil and gas capital expenditures $ 185,308 $ 126,316
=========== ===========
FOURTH QUARTER 2008 RESULTS
Our average net daily equivalent production volumes for the fourth quarter 2008 were 37.4 MMcfe per day, up 5% when compared to those for the fourth quarter 2007. Benefiting from both our operated and non-operated drilling activity in the Williston Basin, our oil volumes for the fourth quarter 2008 averaged 2,279 barrels per day, which represents a 118% increase from the 1,045 barrels per day produced in the fourth quarter 2007. Revenues from the sale of oil and natural gas including hedge settlements for the fourth quarter 2008 were down 11% to $26.0 million when compared to those for the fourth quarter 2007. Lower realized prices decreased revenues by $10.5 million, while higher production volumes and higher hedge settlement gains increased revenues by $6.2 million and $1.2 million, respectively.
Our average realized price for natural gas for the fourth quarter 2008 was $7.04 per Mcf, which included a $0.61 per Mcf gain associated with the settlement of our natural gas derivative contracts. This compares to an average realized price in the fourth quarter 2007 of $8.02, which included a $0.45 per Mcf gain due to the settlement of our natural gas derivative contracts. During the fourth quarter 2008, our average realized price for oil was $53.35 per barrel, which included a $3.28 per barrel gain due to the settlement of our oil derivative contracts. This compares to an average realized price in the fourth quarter 2007 of $84.98, which included a $4.29 per barrel loss due to the settlement of our oil derivative contracts.
Our fourth quarter 2008 per Mcfe production costs were up 49% when compared to those for the fourth quarter 2007. The increase was largely driven by a $0.36 per Mcfe increase in O&M expense and a $0.08 per Mcfe increase in production taxes. O&M expense rose due to higher saltwater disposal, compressor rental and fuel costs. Production taxes rose due to a $0.2 million decrease in high cost gas production tax abatements in 2008 as compared to 2007.
G&A expense for the fourth quarter 2008 decreased $0.4 million compared to the fourth quarter 2007 because of lower employee bonuses which were partially offset by both higher contract and professional services and higher franchise taxes.
Our depletion expense for the fourth quarter 2008 was $16.9 million ($5.03 per Mcfe) compared to $13.7 million ($4.30 per Mcfe) in the fourth quarter 2007. Our higher depletion rate increased depletion expense by $2.5 million and our higher production volumes increased depletion expense by $0.7 million. The increase in our depletion rate was a result of an increase in the cost of reserve additions.
In the fourth quarter 2008, we recorded a $237.2 million non-cash ceiling test impairment charge ($148.6 million after-tax) on our oil and gas properties. A ceiling test impairment is recorded when the capitalized cost of our oil and gas properties exceeds the present value (10% per annum discount rate) of estimated future net cash flows based on commodity prices at the end of the reporting period plus certain unevaluated property costs. Commodity spot prices as of December 31, 2008 for Henry Hub natural gas and West Texas intermediate crude oil were $5.71 per Mcf and $44.60 per barrel.
Our net interest expense for the fourth quarter 2008 increased $0.3 million, or by 8%, from the fourth quarter 2007. This increase was primarily due to our higher weighted average debt outstanding of $260.1 million in the fourth quarter 2008 versus $176.6 million in the fourth quarter 2007. The increase in weighted average debt outstanding was partially offset by a 67% increase in capitalized interest expense.
We recorded a deferred income tax benefit of $53.9 million in the fourth quarter of this year compared to a deferred income tax expense of $1.5 million in the fourth quarter last year. The deferred income tax benefit primarily resulted from the ceiling test writedown of $237.2 million.
Our reported net income (loss) for the fourth quarter 2008 was ($180.6) million (($3.95) per diluted share) versus net income of $1.8 million ($0.04 per diluted share) for the same period last year. Our after-tax earnings (loss) in the fourth quarter 2008 excluding our unrealized derivative gains and ceiling test impairment charge were ($1.9) million (($0.04) per basic share), while our after-tax earnings in the fourth quarter 2007 excluding unrealized derivative losses were $3.4 million ($0.07 per diluted share). After-tax earnings excluding the above items is a non-GAAP measure and a reconciliation of GAAP net income to after-tax earnings excluding the above items is included in our accompanying financial tables found later in this release.
In the fourth quarter 2008, we spent $47.3 million on oil and gas capital expenditures, which represents a 31% increase from 2007. Oil and gas capital expenditures for 2008 and 2007 were:
Three Months Ended December 31,
-------------------------------
2008 2007
--------------- ---------------
(in thousands)
Drilling $ 36,815 $ 25,765
Net land and seismic 7,566 7,558
Capitalized costs 2,724 2,782
Capitalized SFAS 143 ARO 145 0
--------------- ---------------
Total oil and gas capital expenditures $ 47,250 $ 36,105
=============== ===============
2008 PROVED RESERVES
Our estimated net proved reserve volumes at December 31, 2008 totaled 137.1 Bcfe of which approximately 69% was natural gas. During 2008, we added approximately 8.3 Bcfe in net proved reserves and replaced 73% of our 11.5 Bcfe of production. As of December 31, 2008, our estimated proved reserves were comprised of 63.4 Bcfe of net proved developed and 73.6 Bcfe of net proved undeveloped reserves.
Equivalent Reserves
(MMcfe)
-------------------
2008 Beginning Proved Reserves 140,202
Extensions, discoveries & other additions 13,688
Revisions of prior estimates (5,356)
Sale of minerals-in-place
Production (11,464)
-------------------
2008 Ending Proved Reserves 137,070
===================
At year-end 2008, the standardized measure and the pre-tax present value ("Pre-tax PV10% Value") of our estimated proved reserves were $279.3 million and $288.0 million, respectively. For 2008, these measures were calculated using a West Texas Intermediate Sweet oil price of $44.60 per barrel and a Henry Hub natural gas price of $5.71 per MMBtu.
Bud Brigham, the Chairman, President and CEO, commented, "At mid-year 2008, we had high expectations for reserve growth during the year. The biggest factor negatively impacting that growth was of course the dramatic fall in commodity prices, particularly for oil in our Bakken Three Forks play. In that play, we invested the largest portion of our capital, 62% of our drilling capex, drilling in a $100 per barrel of oil cost environment, and then subsequently booking the associated reserves at $44.60 per barrel. The drilling cost and oil price mismatch element was compounded by the fact that we could only book proved undeveloped reserves to a level associated with the drilling and completion technology used in the original, directly offsetting well. As a consequence, proved undeveloped locations offsetting older technology wells were booked at lower reserve volumes, or not at all, relative to the volumes associated with our more recent wells completed with a greater number of fracture stimulation stages."
At December 31, 2008
--------------------
(in millions)
Standardized measure of discounted future net cash
flows $ 279.3
Add present value of future income tax discounted at
10% 8.7
--------------------
Pre-tax PV10% Value $ 288.0
====================
Pre-tax PV10% Value is the estimated present value of the future net revenues from our proved oil and natural gas reserves before income taxes, discounted using a 10% discount rate. Pre-tax PV10% Value is considered a non-GAAP financial measure under SEC regulations because it does not include the effects of future income taxes, as is required in computing the standardized measure of discounted future net cash flows. We believe that Pre-tax PV10% Value is an important measure that can be used to evaluate the relative significance of our oil and natural gas properties and that Pre-tax PV10% Value is widely used by security analysts and investors when evaluating oil and natural gas companies. Because many factors that are unique to each individual company impact the amount of future income taxes to be paid, the use of a pre-tax measure provides greater comparability of assets when evaluating companies. We believe that most other companies in the oil and natural gas industry calculate Pre-tax PV10% Value on the same basis. Pre-tax PV10% Value is computed on the same basis as the standardized measure of discounted future net cash flows, but without deducting income taxes.
2009 CAPITAL EXPENDITURE BUDGET
The current capital expenditure budget for 2009 includes completing several of our late 2008 wells in the Williston Basin in early 2009, completing additional 2008 Williston Basin wells in mid-summer 2009 after expected further reductions in service costs, hooking up our Southern Louisiana wells to production and drilling and completing a Gulf Coast well. Our budgeted capital expenditure program for 2009 is as follows:
(In millions)
-------------
Drilling $ 26.7
Net land and seismic (2.4)
-------------
Exploration and development capital expenditures $ 24.3
Capitalized Costs 12.5
Other non-oil & gas assets 0.3
-------------
Total $ 37.1
=============
Bud Brigham commented, "The capital budget that we've announced today positions us to maintain our financial flexibility in a very difficult environment. However, we will revisit the current 2009 cap-ex budget as we move through the year. Further, we anticipate closing one or several of the transactions outlined below after March, and as long as oil prices stabilize or improve and services costs continue to decrease, we would expect to be able to scale up our drilling during the second half of 2009."
FIRST QUARTER 2009 FORECASTS
The following forecasts and estimates of our first quarter 2009 production volumes are forward looking statements subject to the risks and uncertainties identified in the "Forward Looking Statements Disclosure" at the end of this release. We currently expect our first quarter 2009 production volumes to average between 30.0 MMcfe per day and 33.0 MMcfe per day. Given the uncertainty around our 2009 cap-ex budget for the second half of 2009, we are electing not to provide a full year production forecast, but will revisit this decision as we move through the year.
For the first quarter 2009, lease operating expenses are projected to be $1.48 per Mcfe based on the mid-point of our production guidance, production taxes are projected to be approximately 5.25% to 5.50% of pre-hedge oil and natural gas revenues, and G&A expenses are projected to be $2.15 million ($0.80 to $0.72 per Mcfe).
MANAGEMENT COMMENTS
Bud Brigham commented, "During early 2008, we brought on-line our first Bakken wells east of the Nesson Anticline in Mountrail County. Throughout the year, we rapidly acquired acreage in the Williston Basin and have assembled one of the premier acreage positions in the basin for a company our size. In addition, we rapidly advanced drilling and completion techniques, with our most recent wells being our most successful in term of initial rates and forecasted economic ultimate recoveries. The rapid improvement in our results with the Mrachek, Johnson, Carkuff and Adix wells gave us the confidence to pick up a second operated rig late in the year."
Bud Brigham continued, "We moved our two operated rigs west of the Nesson Anticline in order to further test our 105,590 net acres in Williams and McKenzie Counties and our engineers developed a plan to be the first company in the basin to complete a long lateral with 19 swell packers and 20 fracture stimulation stages. We announced the highly successful results of our first well completed with this technology, the Olson 10-15 #1H, in early February at an initial production rate of 1,200 barrels of oil per day and 1.4 MMcf of natural gas per day. To date, the well continues to perform strongly and it has the highest cumulative recovery of any of our wells in the basin over a similar production period. It's a huge compliment to our highly effective staff that we were able to drill and complete the first well of this type successfully."
Bud Brigham continued, "Unfortunately at about the same time we picked up our second rig, the unprecedented economic upheaval firmly took root and the price of oil and natural gas rapidly decreased. Meanwhile, drilling day rates, steel costs and pressure pumping rates were elevated from the high levels of activity in the summer 2008. In response to rapidly decreasing commodity prices and high service costs, we dropped both of our Williston Basin operated rigs by mid February, as we wanted to maintain financial flexibility and believed that much more favorable service costs, and therefore better project economics, would be experienced this summer."
Gene Shepherd, Brigham's Chief Financial Officer, commented, "In response to the current economic uncertainty and in order to maintain financial flexibility, we drew down our unused availability under our senior credit facility just before year end and at the present time have $33.3 million of cash on the balance sheet. Based on our announced 2009 capital expenditure budget and our reduced level of drilling activity since mid February, we are forecasting to be free cash flow positive for the remainder of 2009. We have a number of additional initiatives under way to further enhance our liquidity during these uncertain times, including the $6 million sale of our Mountrail County mineral interests that we expect to close by the end of March. Further, we are actively marketing our non-operated 7,715 net acres in the Parshall / Austin / Sanish fields. We are also marketing up to 50% of our working interest in a portion of our remaining 301,058 net acres in the Williston Basin, but we will remain the operator. We believe that our strong acreage position in this premier oil resource play provides us the opportunity to sell working interest positions in portions of the play, thereby accessing additional capital, while retaining a very substantial inventory of net drilling locations for future net asset value growth. Lastly, we have reduced our cash G&A costs and will continue to do so throughout the year. During the second half of 2008, no bonuses were paid to employees. We currently anticipate reducing our 2009 cash G&A costs by 10 to 15% relative to those in 2008."
CONFERENCE CALL INFORMATION
Our management will host a conference call to discuss operational and financial results for the year-end and fourth quarter 2008 with investors, analysts and other interested parties on Thursday, March 12, at 10:00 a.m. Eastern Time. To participate in the call, participants within the U.S. please dial 888-713-4217 and participants outside the U.S. please dial 617-213-4869. The participant passcode for the call is 45020372. Participants may pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=P6CTKHPEV. Pre-registrants will be issued a pin number to use when dialing into the live call which will provide quick access to the conference. A telephone recording of the conference call will be available to interested parties approximately two hours after the call is completed through 12:00 p.m. Eastern Time on Thursday, March 19, 2009. To access the recording, domestic callers dial 888-286-8010 and international callers dial 617-801-6888. The passcode for the conference call playback is 11926310. In addition, a live and archived web cast of the conference call will be available over the Internet at www.bexp3d.com.
We will be updating our corporate presentation prior to our conference call and will reference information contained therein. We encourage you to access the presentation in advance of the conference call. To access the presentation, go to www.bexp3d.com and click on Corporate Presentation along the left side of our home page. In addition, a copy of this press release and other financial and statistical information about the periods covered by this press release and by the conference call that will take place on Thursday, March 12, 2009, will be available on our website. To access the press release, go to www.bexp3d.com and click on News Releases. The file with a copy of the press release is named Brigham Exploration Reports Year-End and Fourth Quarter 2008 Results and is dated Wednesday, March 11, 2009. To access the other financial and statistical information that will be covered by the conference call that will take place on Thursday, March 12, go to www.bexp3d.com and click on Event Calendar. The file with the other financial and statistical information is named Financial and Statistical Information for the Fourth Quarter 2008 Conference Call and is dated Thursday, March 12, 2009.
ABOUT BRIGHAM EXPLORATION
Brigham Exploration Company is an independent exploration and production company that applies 3-D seismic imaging and other advanced technologies to systematically explore for and develop onshore domestic oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
Forward-Looking Statement Disclosure
Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements within the meaning of the federal securities laws. Important factors that could cause our actual results to differ materially from those contained in the forward-looking statements include our growth strategies, our ability to successfully and economically explore for and develop oil and gas resources, anticipated trends in our business, our liquidity and ability to finance our exploration and development activities, market conditions in the oil and gas industry, our ability to make and integrate acquisitions, the impact of governmental regulation and other risks more fully described in the company's filings with the Securities and Exchange Commission. Forward-looking statements are typically identified by use of terms such as "may," "will," "expect," "anticipate," "estimate" and similar words, although some forward-looking statements may be expressed differently. All forward-looking statements contained in this release, including any forecasts and estimates, are based on management's outlook only as of the date of this release, and we undertake no obligation to update or revise these forward-looking statements, whether as a result of subsequent developments or otherwise.
BRIGHAM EXPLORATION COMPANY
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data) (unaudited)
Three Months Ended Year Ended
December 31, December 31,
---------------------- ----------------------
2008 2007 2008 2007
---------- ---------- ---------- ----------
Revenues:
Oil and natural gas sales $ 23,996 $ 28,307 $ 125,108 $ 120,557
Hedging settlements 1,981 762 (3,592) 4,167
---------- ---------- ---------- ----------
25,977 29,069 121,516 124,724
Unrealized hedging gains
(losses) 4,495 (2,846) 6,140 (5,831)
---------- ---------- ---------- ----------
30,472 26,223 127,656 118,893
Other revenue 28 15 132 88
---------- ---------- ---------- ----------
Total Revenue 30,500 26,238 127,788 118,981
---------- ---------- ---------- ----------
Costs and expenses:
Lease operating 3,737 2,246 12,363 10,704
Production taxes 1,267 968 5,374 2,541
General and
administrative 1,866 2,303 9,557 9,276
Depletion of oil and
natural gas properties 16,932 13,732 53,498 59,079
Impairment of oil and
natural gas properties 237,180 -- 237,180 6,505
Depreciation and
amortization 165 145 629 613
Accretion of discount on
asset retirement
obligations 98 81 361 379
---------- ---------- ---------- ----------
261,245 19,475 318,962 89,097
---------- ---------- ---------- ----------
Operating income (loss) (230,745) 6,763 (191,174) 29,884
---------- ---------- ---------- ----------
Other income (expense):
Interest expense, net (3,832) (3,551) (14,495) (14,622)
Interest income 28 118 191 654
Other income (expense) 111 15 530 1,022
---------- ---------- ---------- ----------
(3,693) (3,418) (13,774) (12,946)
---------- ---------- ---------- ----------
Income (loss) before income
taxes (234,438) 3,345 (204,948) 16,938
---------- ---------- ---------- ----------
Income tax (expense)
benefit:
Current -- -- -- --
Deferred 53,887 (1,501) 42,701 (6,728)
---------- ---------- ---------- ----------
53,887 (1,501) 42,701 (6,728)
---------- ---------- ---------- ----------
Net income (loss) $ (180,551) $ 1,844 $ (162,247) $ 10,210
========== ========== ========== ==========
Net income (loss) per
share available to common
stockholders:
Basic $ (3.95) $ 0.04 $ (3.57) $ 0.23
========== ========== ========== ==========
Diluted $ (3.95) $ 0.04 $ (3.57) $ 0.22
========== ========== ========== ==========
Weighted average shares
outstanding:
Basic 45,685 45,184 45,441 45,110
========== ========== ========== ==========
Diluted 45,685 45,708 45,441 45,531
========== ========== ========== ==========
BRIGHAM EXPLORATION COMPANY
PRODUCTION, SALES PRICES AND OTHER FINANCIAL DATA
(unaudited)
Three Months
Ended Year Ended
December 31, December 31,
-------------- --------------
2008 2007 2008 2007
------ ------ ------ ------
Average net daily production:
Natural gas (MMcf) 23.7 29.2 22.2 35.1
Oil (Bbls) 2,279 1,045 1,605 1,089
Equivalent natural gas (MMcfe) (6:1) 37.4 35.5 31.8 41.6
Total net production:
Natural gas (MMcf) 2,135 2,629 7,996 12,626
Oil (MBbls) 205 94 578 392
Equivalent natural gas (MMcfe) (6:1) 3,366 3,194 11,463 14,978
% Natural gas 63% 82% 70% 84%
Sales price:
Natural gas ($/Mcf) $ 6.43 $ 7.57 $ 9.21 $ 7.30
Oil ($/Bbl) 50.07 89.27 89.06 72.30
Equivalent natural gas ($/Mcfe) (6:1) 7.13 8.86 10.91 8.05
Sales price including derivative settlement
gains (losses):
Natural gas ($/Mcf) $ 7.04 $ 8.02 $ 9.08 $ 7.66
Oil ($/Bbl) 53.35 84.98 84.63 71.51
Equivalent natural gas ($/Mcfe) (6:1) 7.72 9.10 10.60 8.33
Sales price including derivative settlement
gains (losses) and unrealized gains
(losses):
Natural gas ($/Mcf) $ 8.18 $ 7.52 $ 9.48 $ 7.38
Oil ($/Bbl) 63.41 68.66 89.79 65.57
Equivalent natural gas ($/Mcfe) (6:1) 9.05 8.21 11.14 7.94
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands)
December 31, December 31,
2008 2007
------------ ------------
Assets:
Current assets $ 78,520 $ 32,505
Oil and natural gas properties, net (full cost
method) 404,839 510,207
Other property and equipment, net 1,873 1,034
Other non-current assets 3,824 4,682
------------ ------------
Total assets $ 489,056 $ 548,428
============ ============
Liabilities and stockholders' equity:
Current liabilities $ 48,215 $ 41,718
Senior notes 158,730 158,492
Senior credit facility 145,000 10,000
Mandatorily redeemable preferred stock,
Series A 10,101 10,101
Deferred income tax liability 149 41,625
Other non-current liabilities 5,592 7,465
------------ ------------
Total liabilities $ 367,787 $ 269,401
Stockholders' equity 121,269 279,027
------------ ------------
Total liabilities and stockholders' equity $ 489,056 $ 548,428
============ ============
BRIGHAM EXPLORATION COMPANY
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands) (unaudited)
Three Months Ended Year Ended
December 31, December 31,
---------------------- ----------------------
2008 2007 2008 2007
---------- ---------- ---------- ----------
Cash flows from operating
activities:
Net income (loss) $ (180,551) $ 1,844 $ (162,247) $ 10,210
Depletion, depreciation and
amortization 17,097 13,877 54,127 59,692
Impairment of oil and gas
properties 237,180 -- 237,180 6,505
Accretion of discount on
ARO 98 81 361 379
Amortization of deferred
loan fees and debt
issuance costs 295 255 1,105 968
Non-cash stock compensation 369 450 1,592 1,905
Market value adjustments
for derivatives
instruments (4,495) 2,846 (6,140) 5,831
Deferred income tax expense
(benefit) (53,887) 1,501 (42,701) 6,728
Provision for Doubtful
Accounts 17 -- 17 --
Other noncash items -- -- 4 (4)
Changes in operating assets
and liabilities (20,131) (3,757) (13,668) (1,765)
---------- ---------- ---------- ----------
Cash flows provided by
operating activities $ (4,008) $ 17,097 $ 69,630 $ 90,449
Cash flows used by
investing activities (36,615) (23,930) (179,866) (99,093)
Cash flows (used)
provided by financing
activities 72,003 10,200 136,416 18,207
---------- ---------- ---------- ----------
Net increase (decrease)
in cash and cash
equivalents $ 31,380 $ 3,367 $ 26,180 $ 9,563
========== ========== ========== ==========
SUMMARY PER MCFE DATA
(unaudited)
Three Months Ended Year Ended
December 31, December 31,
------------------ ------------------
2008 2007 2008 2007
-------- -------- -------- --------
Revenues:
Oil and natural gas sales $ 9.05 $ 8.21 $ 11.14 $ 7.94
Other revenue 0.01 -- 0.01 --
-------- -------- -------- --------
$ 9.06 $ 8.21 $ 11.15 $ 7.94
======== ======== ======== ========
Costs and expenses:
Lease operating 1.11 0.70 1.08 0.71
Production taxes 0.38 0.30 0.47 0.17
General and administrative 0.55 0.72 0.83 0.62
Depletion of oil and natural gas
properties 5.03 4.30 4.67 3.94
Impairment of oil and natural gas
properties 70.46 -- 20.69 0.43
Depreciation and amortization 0.05 0.05 0.05 0.04
Accretion of discount on ARO 0.03 0.03 0.03 0.03
-------- -------- -------- --------
$ 77.61 $ 6.10 $ 27.82 $ 5.94
-------- -------- -------- --------
Operating income $ (68.55) $ 2.11 $ (16.67) $ 2.00
======== ======== ======== ========
Interest expense, net of interest
income (a) (1.13) (1.07) (1.25) (0.93)
Other income (expense) (b) 0.03 -- 0.05 0.07
-------- -------- -------- --------
Adjusted income $ (69.65) $ 1.04 $ (17.87) $ 1.14
======== ======== ======== ========
(a) Calculated as interest expense minus interest income divided by
production for period.
(b) Excludes non-cash gains/(losses) arising from hedge accounting for
certain of our oil and natural gas hedges.
BRIGHAM EXPLORATION COMPANY
RECONCILIATION OF GAAP NET INCOME TO AFTER-TAX EARNINGS
EXCLUDING THE EFFECT OF CERTAIN ITEMS
(in thousands)
Three months Year
ended December 31, ended December 31,
---------------------- ----------------------
2008 2007 2008 2007
---------- ---------- ---------- ----------
Net income (loss) as
reported $ (180,551) $ 1,844 $ (162,247) $ 10,210
Unrealized derivative
(gains) losses (4,495) 2,846 (6,140) 5,831
Unrealized derivative
(gains) losses on
ineffective hedges -- -- -- --
Impairment of oil and
natural gas properties 237,180 -- 237,180 6,505
Tax impact (54,021) (1,277) (53,397) (4,678)
---------- ---------- ---------- ----------
Earnings (loss) excluding
the effect of certain
items $ (1,887) $ 3,413 $ 15,396 $ 17,868
========== ========== ========== ==========
Earnings without the effect of certain items represents net income excluding the following: unrealized gains and losses on derivative contracts; unrealized gains and losses related to ineffectiveness on our derivatives that were previously classified as cash flow hedges; and our non-cash impairment charge on our oil and gas properties. Management believes that exclusion of these items enhances comparability of operating results between periods.
BRIGHAM EXPLORATION COMPANY
SUMMARY OF 2009 AND 2010 COMMODITY PRICE HEDGES OUTSTANDING
AS OF MARCH 11, 2009
(unaudited)
2009 2010
---------------------------- ---------------------------
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
------- ------ ------ ------ ------ ------ ------ ------
Natural Gas Costless Collars:
Daily
volumes MMBtu/d 9,111 5,934 5,870 2,283 2,333 3,626 3,587 1,304
Floor $/MMBtu $ 7.954 $7.139 $7.139 $5.750 $5.750 $5.750 $5.750 $6.500
Cap $/MMBtu $ 9.621 $7.950 $7.950 $7.050 $7.050 $7.191 $7.191 $8.250
Natural Gas Three Way Costless Collars:
Daily
volumes MMBtu/d 1,667 2,308 2,283 4,239 4,333 -- -- --
Floor $/MMBtu $ 8.000 $6.250 $6.250 $6.962 $6.962 $ -- $ -- $ --
Written
Put $/MMBtu $ 4.500 $4.750 $4.750 $4.577 $4.577 $ -- $ -- $ --
Cap $/MMBtu $10.350 $8.800 $8.800 $8.615 $8.615 $ -- $ -- $ --
Natural Gas Swaps:
Daily
volumes MMBtu/d 2,000 4,176 1,522 652 -- -- -- --
Price $/MMBtu $ 5.225 $4.956 $4.745 $4.900 $ -- $ -- $ -- $ --
Oil Costless Collars:
Daily
volumes Bbls/d 333 99 -- -- -- -- -- --
Floor $/Bbl $ 79.15 $62.00 $ -- $ -- $ -- $ -- $ -- $ --
Cap $/Bbl $108.53 $81.75 $ -- $ -- $ -- $ -- $ -- $ --
Oil Swaps
Daily
volumes Bbls/d -- 330 326 326 -- -- -- --
Price $/Bbl $ -- $50.75 $50.75 $50.75 $ -- $ -- $ -- $ --
Hedged volumes and prices reflected in this table represent average contract amounts for the quarterly periods presented; natural gas hedge prices and crude oil hedge contract prices are based on NYMEX pricing.
Contact:
Rob Roosa
Finance Manager
(512) 427-3300
SOURCE: Brigham Exploration
[As usual much can be learned with respect tp the overall health of the U.S. O&G Industry by reading BEXP's transparent quarterly reports]
futrcash
Brigham Exploration Announces Fourth Quarter and Year End 2008 Earnings Conference Call
Brigham Exploration Company (Nasdaq: BEXP) will hold its conference call to discuss operational and financial results for the fourth quarter and year end 2008 on Thursday, March 12, 2009 at 10:00 AM ET (9:00 AM CDT).
Brigham plans to issue an earnings press release after the close of market trading on Wednesday, March 11, 2009. Participants are advised to dial in and register at least ten minutes prior to the call. Participants may pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=P6CTKHPEV. Pre-registrants will be issued a pin number to use when dialing in to the live call which will provide quick access to the conference. Interested parties may also dial in using the instructions below, or visit Brigham's website for the live and archived webcast at http://www.bexp3d.com.
Details for the conference call are as follows:
Date & Time:
Thursday, March 12, 2009
10:00 AM ET (9:00 AM CDT)
Host: Bud Brigham - Chairman, CEO and President
Dial-In Number: 888-713-4217 within U.S.
617-213-4869 outside U.S.
Participant Passcode: 45020372
Telephone Replay Number: 888-286-8010 within U.S.
617-801-6888 outside U.S.
Telephone Replay Passcode: 11926310
Telephone Replay Available Through: March 19, 2009
Webcast Address: http://www.bexp3d.com
The webcast is also being distributed over CCBN's Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through CCBN's individual investor center at www.companyboardroom.com or by visiting any of the investor sites in CCBN's Individual Investor Network. Institutional investors can access the call via CCBN's password-protected event management site, StreetEvents (www.streetevents.com).
ABOUT BRIGHAM EXPLORATION
Brigham Exploration Company is an independent exploration and production company that applies 3-D seismic imaging and other advanced technologies to systematically explore for and develop onshore domestic oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
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(NASDAQ:BEXP) Brigham Exploration Company (BEXP) engages in the exploration, development, and production of oil and natural gas in the United States. The company owns property interests in the Onshore Gulf Coast consisting of the Vicksburg trend in Brooks County, Texas; the Frio trend in and around Matagorda County, Texas; and joint venture interests in southern Louisiana. Brigham Exploration also holds interest in Hunton Trend in the Anadarko Basin; Powder River Basin and Williston Basin in the Rocky Mountains; and west Texas. As of December 31, 2006, it had 146.5 billion cubic feet of natural gas equivalent of total estimated, proved reserves. The company sells its oil and natural gas to intrastate pipeline purchasers, operators of processing plants, and marketing companies. Brigham Exploration was founded in 1990 and is headquartered in Austin, Texas.
The Company's exploration and development activities are focused in the Rocky Mountains, Onshore Gulf Coast, the Anadarko Basin and West Texas. During the year ended December 31, 2009, the Company drilled, completed 57 gross wells, consisting of two exploratory wells and 55 development wells with an average completion rate of 98%. The natural gas is sold to various purchasers, including intrastate pipeline purchasers, operators of processing plants, and marketing companies under both monthly spot market contracts and multi-year arrangements.
COMPANY WEB SITE
http://www.bexp3d.com/
SHARES OUTSTANDING
46,127,000
COMPANY REPORTS
FORM 10-K, ANNUAL REPORT, 7-Mar-2008
http://biz.yahoo.com/e/080307/bexp10-k.html
November 23, 2011
Statoil (NYSE: STO) (OSLO: STL) and Brigham Exploration Company (NASDAQ: BEXP) have decided to make voluntary filings with the U.S. Committee on Foreign Investment in the United States (CFIUS) in connection with Statoil's previously announced acquisition of Brigham. The filing is voluntary and consistent with Statoil's policy to cooperate with all relevant governmental authorities in the United States, including CFIUS. Statoil will pay for shares consistent with the pending tender offer. Neither the filing nor completion of the CFIUS review is a condition to closing of Statoil's pending tender offer for shares of common stock of Brigham Exploration. The initial tender offer is currently scheduled to expire at midnight NYC time on November 30, 2011.
Additional Information
This communication is neither an offer to purchase nor a solicitation of an offer to sell any shares of the common stock of Brigham Exploration Company or any other securities. Statoil ASA and Fargo Acquisition Inc. have filed a tender offer statement on Schedule TO, including an offer to purchase, a letter of transmittal and related documents, with the United States Securities and Exchange Commission (the "SEC"). The offer to purchase shares of Brigham common stock (the "Offer") will only be made pursuant to the offer to purchase, the letter of transmittal and related documents filed with such Schedule TO. INVESTORS AND STOCKHOLDERS ARE URGED TO READ BOTH THE TENDER OFFER STATEMENT, AS FILED AND AS IT MAY BE AMENDED FROM TIME TO TIME, AND THE SOLICITATION/RECOMMENDATION STATEMENT REGARDING THE OFFER, AS FILED AND AS IT MAY BE AMENDED FROM TIME TO TIME, BECAUSE THEY CONTAIN IMPORTANT INFORMATION REGARDING THE OFFER. The solicitation/recommendation statement on Schedule 14D-9 has been filed with the SEC by Brigham. Investors and stockholders may obtain a free copy of these statements (when available) and other documents filed with the SEC free of charge at the website maintained by the SEC at www.sec.gov or by directing such requests to Innisfree M&A Incorporated at (877) 687-1875.
About Brigham Exploration
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
Forward-Looking Statement Disclosure
Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements within the meaning of the federal securities laws. Important factors that could cause our actual results to differ materially from those contained in the forward-looking statements include early initial production rates which decline steeply over the early life of wells, particularly our Williston Basin horizontal wells for which we estimate the average monthly production rates may decline by approximately 70% in the first twelve months of production, our growth strategies, our ability to successfully and economically explore for and develop oil and gas resources, anticipated trends in our business, our liquidity and ability to finance our exploration and development activities, market conditions in the oil and gas industry, our ability to make and integrate acquisitions, the impact of governmental regulation and other risks more fully described in the company's filings with the Securities and Exchange Commission. Forward-looking statements are typically identified by use of terms such as "may," "will," "expect," "anticipate," "estimate" and similar words, although some forward-looking statements may be expressed differently. All forward-looking statements contained in this release, including any forecasts and estimates, are based on management's outlook only as of the date of this release, and we undertake no obligation to update or revise these forward-looking statements, whether as a result of subsequent developments or otherwise.
Statoil Further Information
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July 26, 2011
Interested parties may dial in using the instructions below, or visit Brigham's website for the live and archived webcast at http://www.bexp3d.com. Details for the conference call are as follows:
Date & Time: Tuesday, August 9, 2011 11:00 AM ET (10:00 AM CT) Host: Bud Brigham - Chairman, CEO and President Dial-In Number: 877.398.9480 within U.S./Canada 708.290.1157 outside U.S./Canada Conference ID: 86489005 Telephone Replay Number (toll-free): 855.859.2056 Telephone Replay Available Through: August 16, 2011 Webcast Address: http://www.bexp3d.com/
April 3, 2011
Brigham Exploration Company (NASDAQ: BEXP) today announced financial results for the quarter ended March 31, 2011.
FIRST QUARTER 2011 RESULTS
Our average daily production volumes for the first quarter 2011 were 11,314 barrels of crude oil equivalent (Boe) per day, up 109% from the first quarter 2010 and down 1% from the fourth quarter 2010.
Benefiting from both our operated and non-operated drilling activity in the Williston Basin, our high value crude oil production volumes for the first quarter 2011 averaged 9,211 barrels of crude oil per day, which represents a 159% increase from that in the first quarter 2010 and up 1% from that in the fourth quarter 2010. Our high value crude oil production volumes represented 81% of our total production volumes in the first quarter 2011, as compared to 66% in the first quarter 2010 and 80% in the fourth quarter 2010.
Our production volumes in the Williston Basin for the first quarter 2011 were 9,371 Boe per day, which represents a 190% increase from that in the first quarter 2010 and a slight increase from that in the fourth quarter 2010. During March 2011, our Williston Basin volumes exceeded 10,000 Boe per day for the first time in our history.
Our first quarter production volumes included approximately 732 barrels of crude oil produced during the first quarter 2011 and added to inventory. Adjusting our production volumes for amounts included in inventory resulted in first quarter 2011 daily sales volumes of 11,306 Boe per day.
Revenues from the sale of crude oil and natural gas, including cash hedge settlements for the first quarter 2011, were up 158% to $76.0 million as compared to that in the first quarter 2010. Higher crude oil sales volumes and crude oil prices increased revenues by $37.3 million and $9.4 million, respectively. Higher natural gas sales volumes also increased revenue by $0.8 million. Lower cash hedge settlements and natural gas prices decreased revenues by $0.5 million and $0.5 million, respectively.
During the first quarter 2011, our average realized price for crude oil was $82.76 per barrel, which included a $1.27 loss from the cash settlement of our crude oil derivative contracts. This compares to an average realized price in the first quarter 2010 of $72.39 per barrel, which included a $0.30 per barrel cash loss due to the settlement of our crude oil derivative contracts. Our average realized price for natural gas inclusive of natural gas liquids in the first quarter 2011 was $6.57 per Mcf, which included a $0.96 per Mcf cash gain due to the settlement of our natural gas derivative contracts. This compares to an average realized price in the first quarter 2010 of $6.68 per Mcf, which included a $0.67 per Mcf cash gain due to the settlement of our natural gas derivative contracts.
Our first quarter 2011 production costs, which include costs for operating and maintaining (O&M expense) our producing wells, expensed workovers, ad valorem taxes and production taxes, were up $0.95 per Boe when compared to that in the first quarter 2010. The increase was attributable to a $2.37 per Boe increase in production taxes, which was driven by higher commodity prices and higher levels of production in North Dakota, which are subject to an 11.5% tax rate. This increase was partially offset by a $1.48 per Boe decrease in expensed workovers due to fewer workovers.
Our general and administrative (G&A) expenses for the first quarter 2011 decreased by $3.07 per Boe as compared to the prior year's quarter due to our higher production volumes. The per unit decrease associated with our higher production volumes was partially offset by an increase in employee compensation costs due to higher levels of employee salaries in 2011 to ensure competitive compensation levels with other oil and gas companies, and a higher number of employees due to our growth in activity in the Williston Basin.
Our depletion expense for the first quarter 2011 was $18.9 million ($18.61 per Boe) compared to $9.2 million ($19.07 per Boe) in the first quarter 2010. Our higher sales volumes increased depletion expense by $10.2 million while our lower depletion rate decreased depletion expense by $0.5 million.
Our net interest expense for the first quarter 2011 was $0.5 million higher than that in the first quarter 2010. Interest expense increased due to the September 2010 issuance of our $300 million Senior Notes due 2018 and was partially offset by an increase in our capitalized interest associated with our higher level of drilling activity in the Williston Basin.
We recorded deferred income tax expense of $0.2 million in the first quarter 2011, which consists of $0.1 million in deferred federal income tax expense and $0.1 million in deferred North Dakota state income tax expense.
Our reported net income for the first quarter 2011 was $1.6 million ($0.01 per diluted share) versus net income of $11.3 million ($0.11 per diluted share) for the same period last year. Our after-tax earnings in the first quarter 2011 excluding unrealized mark-to-market hedging losses were $33.8 million ($0.29 per diluted share) as compared to our after-tax earnings in the first quarter 2010 excluding our unrealized mark-to-market hedging gains were $8.3 million ($0.08 per diluted share). After-tax earnings excluding the above items is a non-GAAP measure and a reconciliation of GAAP net income to after-tax earnings excluding the above items is included in our accompanying financial tables found later in this release.
Through March 31, 2011, we spent $122.8 million in oil and gas capital expenditures. Capital expenditures for the first three months of 2011 and 2010 were:
Three months ended March 31, ----------------------- 2011 2010 ----------- ----------- (in thousands) Drilling $ 110,778 $ 43,606 Support infrastructure 5,264 -- Land 6,770 8,477 ----------- ----------- Oil and gas capital expenditures $ 122,812 $ 52,083 Capitalized costs 6,641 4,569 Capitalized FAS 143 ARO 178 52 ----------- ----------- Total capital expenditures $ 129,631 $ 56,704 =========== ===========
SECOND QUARTER 2011 FORECASTS
The following forecasts and estimates of our second quarter 2011 production volumes are forward-looking statements subject to the risks and uncertainties identified in the "Forward-Looking Statements Disclosure" at the end of this release. We are forecasting that our second quarter 2011 production volumes to average between 12,000 Boe per day and 14,000 Boe per day and that our crude oil volumes will comprise approximately 82% of our second quarter production volumes.
For the second quarter 2011, lease operating expenses are projected to be $7.40 per Boe based on the mid-point of our production guidance, production taxes are projected to be approximately 10.0 to 10.5% of pre-hedge crude oil and natural gas revenues, and general and administrative expenses are projected to be $3.5 million ($2.99 per Boe).
MANAGEMENT COMMENTS
Gene Shepherd, Brigham's Chief Financial Officer, commented, "As we have demonstrated over the last two years, the consistency of our drilling results continues to give us excellent visibility as to the growth in production volumes and reserves that we expect to achieve in 2011. In addition to continuing to grow our inventory of development drilling locations in western North Dakota and eastern Montana, we expect 2011 to be a year where the company benefits from significant efficiencies in our drilling and completion techniques that should positively impact our costs in the second half of 2011 and in 2012. We expect these efficiencies to help offset the higher drilling and completion costs that we have experienced in 2011. Despite the increased costs, the 10% overage factor that was part of our February budget provides adequate protection against cost overruns such that we believe that we are still operating within our original 2011 budget."
Mr. Shepherd continued, "Given our record first quarter financial performance, strong balance sheet and accelerating level of drilling activity as we enter the second quarter, we look forward to 2011 being one of the most exciting years in our company's history."
CONFERENCE CALL INFORMATION
Our management will host a conference call to discuss operational and financial results for the first quarter 2011 with investors, analysts and other interested parties on Wednesday, May 4, at 11:00 a.m. Eastern Time. To participate in the call, participants within the U.S./Canada please dial 877-398-9480 and participants outside the U.S./Canada please dial 708-290-1157. The conference ID number for the call is 62089416. A telephone recording of the conference call will be available approximately two hours after the call is completed through 11:59 p.m. Eastern Time on Wednesday, May 11, 2011. To access the recording, U.S./Canada callers dial 800-642-1687 and international callers dial 706-645-9291. The conference ID number for the call is 62089416. In addition, a live and archived web cast of the conference call will be available over the Internet at www.bexp3d.com.
We will be updating our corporate presentation prior to our conference call and will reference information contained therein. We encourage you to access the presentation in advance of the conference call. To access the presentation, go to www.bexp3d.com and click on Corporate Presentation along the left side of our home page. In addition, a copy of this press release and other financial and statistical information about the periods covered by this press release and by the conference call that will take place on Wednesday, May 4, 2011, will be available on our website. To access the press release, go to www.bexp3d.com, click on Investor Relations and then click on Press Releases. The file with a copy of the press release is named Brigham Exploration Reports First Quarter 2011 Results and is dated Tuesday, May 3, 2011. To access the other financial and statistical information that will be covered by the conference call that will take place on Wednesday, May 4, 2011, go to www.bexp3d.com, click on Investor Relations and then click on Events & Presentations. The file with the other financial and statistical information is named Financial and Statistical Information for the First Quarter 2011 Conference Call and is dated Wednesday, May 4, 2011.
ABOUT BRIGHAM EXPLORATION
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
FORWARD-LOOKING STATEMENTS DISCLOSURE
Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements within the meaning of the federal securities laws. Important factors that could cause our actual results to differ materially from those contained in the forward-looking statements include early initial production rates which decline steeply over the early life of wells, particularly our Williston basin horizontal wells for which we estimate the average monthly production rates may decline by approximately 70% in the first twelve months of production, our growth strategies, our ability to successfully and economically explore for and develop oil and gas resources, anticipated trends in our business? our liquidity and ability to finance our exploration and development activities? market conditions in the oil and gas industry? our ability to make and integrate acquisitions, the impact of governmental regulation and other risks more fully described in the company's filings with the Securities and Exchange Commission. Forward-looking statements are typically identified by use of terms such as "may," "will," "expect," "anticipate," "estimate" and similar words, although some forward-looking statements may be expressed differently. All forward-looking statements contained in this release, including any forecasts and estimates, are based on management's outlook only as of the date of this release, and we undertake no obligation to update or revise these forward-looking statements, whether as a result of subsequent developments or otherwise.
BRIGHAM EXPLORATION COMPANY SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) Three Months Ended March 31, ---------------------- 2011 2010 ---------- ---------- Revenues: Crude oil sales $ 69,596 $ 22,870 Natural gas sales 6,367 6,060 Hedging settlements 50 582 ---------- ---------- 76,013 29,512 Unrealized hedging gains(losses) (36,008) 3,052 ---------- ---------- 40,005 32,564 Support infrastructure 594 -- Other revenue 2 9 ---------- ---------- Total Revenue 40,601 32,573 ---------- ---------- Costs and expenses: Lease operating 7,720 4,349 Production taxes 7,698 2,508 Support infrastructure 190 -- General and administrative 3,382 3,086 Depletion of oil and natural gas properties 18,940 9,211 Depreciation and amortization 971 233 Accretion of discount on asset retirement obligations 110 105 ---------- ---------- 39,011 19,492 ---------- ---------- Operating income (loss) 1,590 13,081 ---------- ---------- Other income (expense): Interest expense, net (3,378) (2,904) Interest income 367 453 Other income (expense) 3,154 685 ---------- ---------- 143 (1,766) ---------- ---------- Income (loss) before income taxes $ 1,733 $ 11,315 Income tax (expense) benefit: Current -- -- Deferred (179) -- ---------- ---------- (179) -- ---------- ---------- Net income (loss) $ 1,554 $ 11,315 ========== ========== Net income (loss) per share available to common stockholders: Basic $ 0.01 $ 0.11 ========== ========== Diluted $ 0.01 $ 0.11 ========== ========== Weighted average shares outstanding: Basic 116,359 99,444 ========== ========== Diluted 118,522 101,357 ========== ========== BRIGHAM EXPLORATION COMPANY PRODUCTION VOLUMES, SALES VOLUMES, SALES PRICES AND OTHER FINANCIAL DATA (unaudited) Three Months Ended March 31, ---------------- 2011 2010 ------- ------- Average net daily production volumes: Crude oil (Bbls) 9,211 3,552 Natural gas (MMcf) 12.6 11.2 Equivalent crude oil (Boe) (6:1) 11,314 5,420 Total net production volumes: Crude oil (MBbls) 829 320 Natural gas (MMcf) 1,136 1,009 Equivalent oil (MBoe) (6:1) 1,018 488 % Crude oil 81% 66% Increase in inventory: Crude oil (Bbls) 732 5,012 Natural gas (MMcf) -- -- Equivalent crude oil (Boe) (6:1) 732 5,012 Average net daily sales volumes (Average net production volumes less average net daily increase in inventory): Crude oil (Bbls) 9,203 3,496 Natural gas (MMcf) 12.6 11.2 Equivalent crude oil (Boe) (6:1) 11,306 5,364 Total net sales volumes (Total net production volumes less increase in inventory): Crude oil (MBbls) 828 315 Natural gas (MMcf) 1,136 1,009 Equivalent crude oil (MBoe) (6:1) 1,018 483 % Crude oil 81% 65% Sales price: Crude oil ($/Bbl) $ 84.03 $ 72.69 Natural gas ($/Mcf) 5.61 6.01 Equivalent crude oil ($/Boe) (6:1) 74.65 59.93 Sales price including derivative settlement gains (losses): Crude oil ($/Bbl) $ 82.76 $ 72.39 Natural gas ($/Mcf) 6.57 6.68 Equivalent crude oil ($/Boe) (6:1) 74.70 61.13 Sales price including derivative settlement gains (losses) and unrealized gains (losses): Crude oil ($/Bbl) $ 40.48 $ 73.90 Natural gas ($/Mcf) 5.70 9.23 Equivalent crude oil ($/Boe) (6:1) 39.31 67.45 SUMMARY CONSOLIDATED BALANCE SHEETS (in thousands) March 31, December 2011 31, 2010 ----------- ----------- Assets: Current assets $ 323,306 $ 360,857 Oil and natural gas properties, net (full cost method) 774,557 669,356 Other property and equipment, net 47,984 42,837 Other non-current assets 15,451 12,351 ----------- ----------- Total assets $ 1,161,298 $ 1,085,401 =========== =========== Liabilities and stockholders' equity: Current liabilities $ 236,747 $ 176,545 Senior notes 300,000 300,000 Other non-current liabilities 28,634 15,586 ----------- ----------- Total liabilities $ 565,381 $ 492,131 Stockholders' equity 595,917 593,270 ----------- ----------- Total liabilities and stockholders' equity $ 1,161,298 $ 1,085,401 =========== =========== BRIGHAM EXPLORATION COMPANY SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) Three Months Ended March 31, ---------------------- 2011 2010 ---------- ---------- Cash flows from operating activities: Net income (loss) $ 1,554 $ 11,315 Depletion, depreciation and amortization 19,911 9,444 Accretion of discount on ARO 110 105 Amortization of deferred loan fees and debt issuance costs 526 506 Non-cash stock compensation 747 427 Market value adjustments for derivatives instruments 36,008 (3,052) Deferred income tax expense 179 -- Provision for doubtful accounts (2) -- Other noncash items -- (1) Changes in operating assets and liabilities 7,178 7,229 ---------- ---------- Cash flows provided by operating activities $ 66,211 $ 25,973 Cash flows provided (used) by investing activities (65,525) (42,910) Cash flows provided (used) by financing activities (3,843) 632 ---------- ---------- Net increase (decrease) in cash and cash equivalents $ (3,157) $ (16,305) ========== ========== SUMMARY PER BOE DATA (unaudited) Three Months Ended March 31, ---------------------- 2011 2010 ---------- ---------- Revenues: Crude oil and natural gas sales $ 74.65 $ 59.93 Hedging settlements 0.05 1.20 Unrealized hedging gains (losses) (35.39) 6.32 Support infrastructure 0.58 -- Other revenue -- 0.02 ---------- ---------- $ 39.89 $ 67.47 ========== ========== Costs and expenses: Lease operating 7.58 9.00 Production taxes 7.56 5.19 Support infrastructure 0.19 -- General and administrative 3.32 6.39 Depletion of oil and natural gas properties 18.61 19.07 Depreciation and amortization 0.95 0.48 Accretion of discount on ARO 0.11 0.22 ---------- ---------- $ 38.32 $ 40.35 ---------- ---------- Operating income (loss) $ 1.57 $ 27.12 ========== ========== Interest expense, net of interest income (a) (2.96) (5.07) Other income (expense) 3.10 1.42 ---------- ---------- Adjusted income (loss) $ 1.71 $ 23.47 ========== ========== (a) Calculated as interest expense minus interest income divided by production for period. BRIGHAM EXPLORATION COMPANY RECONCILIATION OF GAAP NET INCOME TO AFTER-TAX EARNINGS EXCLUDING THE EFFECTS OF CERTAIN ITEMS (in thousands) Three months ended March 31, ---------------------- 2011 2010 ---------- ---------- Net income (loss) as reported $ 1,554 $ 11,315 Unrealized derivative (gains) losses 36,008 (3,052) Tax impact (3,720) -- ---------- ---------- Earnings excluding the effects of certain items $ 33,842 $ 8,263 ========== ========== Earnings without the effects of certain items represent net income excluding unrealized gains and losses on derivative contracts. Management believes that exclusion of these items enhances comparability of operating results between periods. BRIGHAM EXPLORATION COMPANY SUMMARY OF COMMODITY PRICE HEDGES OUTSTANDING AS OF MAY 3, 2011 (unaudited) 2011 2012 ---------------------- ------------------------------- Q2 Q3 Q4 Q1 Q2 Q3 Q4 ------ ------- ------- ------- ------- ------- ------- Crude Oil Costless Collars: Daily volumes Bbls/d 6,110 7,587 9,207 8,239 8,580 10,168 10,000 Floor $ /Bbl $65.68 $ 67.69 $ 70.84 $ 69.03 $ 69.46 $ 71.71 $ 73.99 Cap $ /Bbl $98.83 $103.57 $109.45 $109.07 $110.07 $114.56 $116.11 Crude Oil Floors: Daily volumes Bbls/d -- -- -- 1,500 1,500 1,500 1,500 Floor $ /Bbl $ -- $ -- $ -- $ 65.00 $ 65.00 $ 80.00 $ 80.00 Natural Gas Costless Collars: Daily volumes MMBtu/d 3,626 3,587 3,587 -- -- -- -- Floor $/MMBtu $ 5.48 $ 5.48 $ 5.48 $ -- $ -- $ -- $ -- Cap $/MMBtu $ 7.16 $ 7.16 $ 7.16 $ -- $ -- $ -- $ -- 2013 --------------- Q1 Q2 ------- ------- Crude Oil Costless Collars: Daily volumes Bbls/d 9,000 1,341 Floor $ /Bbl $ 80.38 $ 85.00 Cap $ /Bbl $125.25 $134.00 Crude Oil Floors: Daily volumes Bbls/d -- -- Floor $ /Bbl $ -- $ -- Natural Gas Costless Collars: Daily volumes MMBtu/d -- -- Floor $/MMBtu $ -- $ -- Cap $/MMBtu $ -- $ -- Hedged volumes and prices reflected in this table represent average contract amounts for the quarterly periods presented; crude oil hedge contract prices and natural gas hedge prices are based on NYMEX pricing.
Contact:
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February 24, 2011
Brigham Exploration Company (NASDAQ: BEXP) announced that it will begin its acceleration to 12 operated Williston Basin rigs in 2011. Brigham also announced micro-seismic monitoring and production results that appear to support four wells per producing horizon per 1,280 acre spacing unit, or eight total Bakken and Three Forks locations per spacing unit. Brigham announced that the Swindle 16-9 #1H, its second Montana Bakken completion, produced at an early 24-hour peak flow back rate of approximately 1,065 barrels of equivalent. Brigham also announced the completion of two additional North Dakota Bakken wells at an average early 24-hour peak flow back rate of 3,513 barrels of oil equivalent. Finally, Brigham provided an update on its drilling and completion activities in the Williston Basin.
Williston Basin Activity Accelerating to 12 Operated Rigs
Brigham announced that it plans to accelerate its Williston Basin operated rig count to 12 rigs by continuing to add an incremental operated rig every 4 months after adding its planned eighth rig in May 2011. Accelerating from eight to 12 operated rigs is anticipated to increase Brigham's drilling pace by approximately 44 gross wells per year, or approximately 29 net wells, once at the 12 operated rig level. Brigham anticipates reaching 12 operated rigs by September 2012.
Based on an accelerated level of activity in 2011, Brigham anticipates drilling approximately 66 net Williston Basin Bakken and Three Forks wells during 2011 as compared to approximately 39 net wells in 2010. Drilling capital is anticipated to be approximately $582.1 million in 2011, which incorporates a total per well cost of approximately $7.9 million plus a 10% budgeted overage.
Micro-seismic Monitoring and Early Production Supports Eight Total Wells Per 1,280 Acre Spacing Unit
Brigham announced that the interpretation of the micro-seismic data from the 18 square mile data set accumulated during the Brad Olson 9-16 #2H fracture stimulation indicates that frac wings appear to extend laterally approximately 500' on either side of the wellbore, or 1,000' in total, per well. Based on a one mile wide spacing unit, results from the micro-seismic monitoring appear to support development of at least four wells per producing horizon per 1,280 acre spacing unit, or approximately eight total Bakken and Three Forks wells per spacing unit.
Based on the increased density drilling opportunity, Brigham estimates that its de-risked drilling inventory in its Ross / Parshall / Austin and Rough Rider project areas has increased from 590 total net locations to approximately 782 total net locations.
Smart Pad Development
Brigham announced that it has initiated utilization of smart pad development in its Rough Rider and Ross project areas. Smart pad development can be implemented either by drilling multiple wells from the same location in a single spacing unit or by drilling stacked 1,280 acre spacing units, one to the north and one to the south, and drilling multiple wells in both spacing units from the same location. Smart pad development, once fully implemented, is anticipated to save approximately 10% to 20% per well on drilling and completion capital expenditures. Furthermore, smart pads are expected to reduce surface footprints and allow for consolidation of equipment and services into centralized facilities.
Drilling efficiencies are achieved by minimizing rig mobilization and demobilization times by placing wellbores in close proximity, which allows rigs to be moved without complete disassembly. Alternatively, "walking rigs," or rigs that can move short distances from wellhead to wellhead, also minimize rig related move time. To gain these additional advantages, Brigham has ordered two PACE "B" Series walking rigs from Nabors Drilling USA, LP (an operating unit of Nabors Industries, Ltd, (NYSE: NBR)) and expects to begin drilling operations with these rigs late in 2011 or early in 2012. Drilling efficiencies are also achieved by simultaneously drilling the same segment of multiple wellbores, which minimizes the amount of time spent laying down drill pipe and changing mud systems.
Completion efficiencies are achieved via the simultaneous fracture stimulation of wells in close proximity. While one well is fracing, the other well is undergoing perf and plug wire line procedures. Completion crews then alternate the fracing and wire line work between wells. Brigham has just completed its first simultaneous fracture stimulation in Ross with the Sorenson 29-32 #2H and the Cvancara 20-17 #1H. Based on initial results, it appears that approximately nine to 11 stages can be completed per day with simultaneous stimulation versus 6 stages per day while independently fracing wells.
In total, Brigham's large and concentrated acreage positions in Rough Rider and Ross provide approximately 188 operated 1,280 acre spacing units for potential smart pad development, where the company could drill as many as 1,504 gross wells. Brigham estimates that 112 of these spacing units are stacked units (two 1,280 acre spacing units that adjoin each other end to end), which provides additional drilling and completion efficiencies. Current 2011 drilling plans include 26 stacked units to be drilled in Rough Rider and Ross.
Montana Bakken Completion Results / Update
Brigham announced that the Swindle 16-9 #1H, which is located in Roosevelt County, produced approximately 1,065 barrels of oil equivalent during its early 24-hour peak flow back period. The well was completed with 19 fracture stimulation stages as the liner with swell packers did not reach total depth. Approximately 3,200' of the outermost wellbore was completed with a single open hole fracture stimulation.
Brigham is currently in the process of fracture stimulating the Johnson 30-19 #1H, which is located in Richland County, with 30 fracture stimulation stages after successfully running the liner to bottom. Also in Richland County, Brigham is in the process of recompleting the Voss 21-11H, which was purchased from another operator who drilled and completed it in August 2007 with a single fracture stimulation. The old liner was successfully removed from the wellbore and Brigham is in the process of cleaning out the entirety of the wellbore in preparation of running a liner with swell packers in order to stimulate the well with 28 stages.
Brigham is in the process of drilling the Beck 15-10 #1H in Roosevelt County. The Beck 15-10 #1H is located approximately five miles north of the Rogney 17-8 #1H, which was completed in August 2010.
Williston Basin Operated North Dakota Well Result Update
Brigham has now completed 51 consecutive long lateral high frac stage wells in North Dakota with an average early 24-hour peak flow back rate of approximately 2,858 barrels of oil equivalent per day. The following table updates Brigham's North Dakota long lateral, high frac stage well results:
Early 24-Hour Peak Flow Back Rate ------------------------ Barrels of Crude Oil County, Working Oil Natural Equivalent Well State Objective Stages Interest (1) Gas (2) (3) ------------ ------------ --------- ------ -------- ----- ------- ---------- Knoshaug 14-11 #1H Williams, ND Bakken 36 50% 3,761 4.09 4,443 Gibbins 1-12 #1H McKenzie, ND Bakken 33 55% 2,305 1.66 2,582 Average 3,513 1. Barrels of crude oil. 2. Millions of cubic feet of natural gas (MMcf). 3. Converted to barrels of oil equivalent using the ratio of six Mcf of natural gas per barrel of crude oil.
Williston Basin Operated Drilling and Completion Update
Brigham's accelerated development of its acreage in North Dakota and Montana is proceeding with four operated rigs drilling in Rough Rider, two operated rigs drilling in Ross and the aforementioned operated rig drilling in Roosevelt County, Montana. Brigham's eighth and ninth operated rigs are currently expected to arrive in May and September 2011, respectively.
Brigham currently has two wells flowing back, two wells fracing and 12 wells waiting on completion.
By mid-April, Brigham expects to add additional fracture stimulation capacity thereby providing access to two fully dedicated frac crews focused on completing Brigham operated horizontal wells in the basin. At that time, Brigham estimates that a minimum of eight wells per month will be fracture stimulated and brought on line to production due to the efficiencies gained by simultaneous stimulations.
Year-End 2010 Proved Reserves
As previously announced, Brigham increased its proved reserves by 141% to 66.8 million barrels of equivalent. Proved reserves were 78% crude oil and were 35% proved developed. During the year, Brigham drilled 44 net wells, 39 of which were located in the Williston Basin. At year-end 2010, approximately 58 net proved developed and 96 net proved undeveloped locations were booked in the Williston Basin, representing approximately 7% and 12% of Brigham's total available de-risked inventory of locations based on four well spacing per producing horizon. Revisions included approximately 0.8 million barrels of oil equivalent in conventional natural gas reserves that were removed from proved reserves as they were unlikely to be drilled within the five year development window required under SEC rules.
Brigham's reserve reconciliation is provided in the table below:
Equivalent Reserves (MMBoe) -------------------- 2010 Beginning Proved Reserves 27.7 Extensions, discoveries & other additions 39.1 Revisions of prior estimates 3.4 Purchases of minerals-in-place 0.2 Sale of minerals-in-place (0.6) Production (3.0) -------------------- 2010 Ending Proved Reserves 66.8 ====================
During 2010, Brigham spent approximately $280.1 million on drilling capital and $112.2 million on land. Proved drilling and land finding and development costs for 2010 based on additions and revisions were $9.23 per barrel of oil equivalent. Proved developed finding costs based on the aforementioned drilling capital and excluding purchases were estimated to be approximately $16.75 per barrel of oil equivalent. Brigham's operated Bakken / Three Forks proved developed finding costs were estimated to be $15.57 per barrel of oil equivalent versus $25.83 per barrel of oil equivalent for non-operated volumes.
Management Comments
Bud Brigham, the Chairman, President and CEO, commented, "We're very excited to announce the acceleration of our operated activity in the Williston Basin to 12 rigs. Our highly skilled and innovative staff has successfully and seamlessly executed our current acceleration and I believe we will continue with the successful and seamless integration of the four additional rigs contemplated with our ramp up to 12 rigs."
Bud Brigham continued, "Our staff is continuing to innovate and has focused attention on the capital cost side of the return equation given the 782 total net de-risked locations we have to drill in our Ross and Rough Rider project areas. In my opinion, the utilization of smart pad drilling will clearly enhance returns via reduced costs but will also make utilization of our service provider crews more efficient. For example, we should, with the implementation of simultaneous fracture stimulations, be able to complete additional wells with the same number of dedicated frac crews. As we've de-risked vast areas of acreage, we are moving into full scale development mode in these areas. Our team is and will continue to work diligently towards beginning to capture and quantify those efficiencies in 2011."
Bud Brigham continued, "We continue to work towards de-risking our Montana acreage with the drilling and completion of additional wells in both Roosevelt and Richland Counties. We believe the Swindle 16-9 #1H had a good outcome given the issues encountered while attempting to run our liner to bottom. We are currently fracing the Johnson 30-19 #1H, recompleting the Voss 20-11H and drilling the Beck 15-10 #1H. Furthermore, industry activity is accelerating in Eastern Montana as operators secure additional acreage and begin to drill wells."
Bud Brigham concluded, "Our numerous opportunities to improve returns by enhancing recoveries and reducing costs will be exciting initiatives in 2011. Our record 2010 reserve additions announced earlier this year already created positive operational momentum for a strong 2011. We look forward to updating our stockholders on our numerous initiatives and catalysts as we move through the remainder of 2011."
About Brigham Exploration
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
Forward-Looking Statement Disclosure
Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements within the meaning of the federal securities laws. Important factors that could cause our actual results to differ materially from those contained in the forward-looking statements early initial production rates which decline steeply over the early life of wells, particularly our Williston basin horizontal wells for which we estimate the average monthly production rates may decline by approximately 70% in the first twelve months of production, our growth strategies, our ability to successfully and economically explore for and develop oil and gas resources, anticipated trends in our business, our liquidity and ability to finance our exploration and development activities, market conditions in the oil and gas industry, our ability to make and integrate acquisitions, the impact of governmental regulation and other risks more fully described in the company's filings with the Securities and Exchange Commission. Forward-looking statements are typically identified by use of terms such as "may," "will," "expect," "anticipate," "estimate" and similar words, although some forward-looking statements may be expressed differently. All forward-looking statements contained in this release, including any forecasts and estimates, are based on management's outlook only as of the date of this release, and we undertake no obligation to update or revise these forward-looking statements, whether as a result of subsequent developments or otherwise.
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January 27, 2011
Brigham Exploration Company (NASDAQ: BEXP) announced that year-end 2010 proven reserves increased 141% to a record 66.8 million barrels of oil equivalent (Boe). Brigham also announced that fourth quarter 2010 production volumes are estimated to be a record 11,384 barrels of equivalent per day (Boepd), which represents a 125% increase from the fourth quarter 2009 and a 34% sequential increase. Further, Brigham announced the completion of four high rate North Dakota Bakken wells at an average early 24-hour peak flow back rate of 3,078 Boe. To date, Brigham has completed 49 consecutive long lateral, high frac stage Bakken and Three Forks wells in North Dakota at an average early 24-hour peak flow back rate of 2,831 Boe. Finally, Brigham provided an update on its drilling and completion activities in the Williston Basin.
Year-End 2010 Proven Reserves
Brigham's proved reserves totaled a company record 66.8 million Boe at year-end 2010. Brigham grew reserves 141% during the year and replaced 1427% of its estimated 2010 production volumes. Additions including revisions increased reserves 42.5 million Boe and were primarily attributable to the Company's highly successful drilling efforts in the Williston Basin Bakken and Three Forks plays, where Brigham grew reserves 260% to 55.4 million Boe. At year-end 2010, Brigham's high value oil volumes comprised a record 78% of proved reserves as compared to 60% at year-end 2009. Proved developed reserves comprised 35% of year-end 2010 reserves, as compared to 37% at year-end 2009.
For year-end 2010, reserve calculations were based on the average first day of the month price for the prior 12 months. The prices utilized for the year-end 2010 reserve report were $79.43 per barrel of crude oil and $4.38 per Mmbtu of natural gas. Utilizing these prices, Brigham's pre-tax PV10% Value of its proved reserves was $1.1 billion, which represents a 336% increase from year-end 2009. Using strip prices as of December 31, 2010, the pre-tax PV10% Value of Brigham's proved reserves would have been $1.5 billion.
Pre-tax PV10% Value is the estimated present value of the future net revenues from Brigham's proved oil and natural gas reserves before income taxes, discounted using a 10% discount rate. Pre-tax PV10% Value is considered a non-GAAP financial measure under SEC regulations because it does not include the effects of future income taxes, as is required in computing the standardized measure of discounted future net cash flows. Brigham believes that pre-tax PV10% Value is an important measure that can be used to evaluate the relative significance of its oil and natural gas properties and that pre-tax PV10% Value is widely used by security analysts and investors when evaluating oil and natural gas companies. Because many factors that are unique to each individual company impact the amount of future income taxes to be paid, the use of a pre-tax measure provides greater comparability of assets when evaluating companies. Brigham believes that most other companies in the oil and natural gas industry calculate pre-tax PV10% Value on the same basis. Pre-tax PV10% Value is computed on the same basis as the standardized measure of discounted future net cash flows, but without deducting income taxes. The reconciliation of Brigham's Pre-tax PV10% Value to its standardized measure will be included in its Brigham's Form 10-K as the information necessary to compute the standardized measure is not yet available.
Brigham's proved reserves as of December 31, 2010 were prepared by the independent reserve engineering firm Cawley, Gillespie & Associates, Inc. in accordance with SEC guidelines.
Estimated Fourth Quarter 2010 Production
Brigham's estimated average daily production volumes for the fourth quarter 2010 were a quarterly record 11,384 Boepd, up 125% from the fourth quarter 2009 and up 34% from the third quarter 2010. Brigham's previous record quarterly production volumes were 8,509 Boepd in the third quarter 2010.
Benefiting from both its operated and non-operated drilling activity in the Williston Basin, Brigham's high value crude oil production volumes for the fourth quarter 2010 averaged 9,129 barrels of crude oil per day, which represents a 218% increase from that in the fourth quarter 2009 and a 44% sequential increase from that in the third quarter 2010. Brigham's high value crude oil production volumes represented 80% of its total production volumes in the fourth quarter 2010, as compared to 57% in the fourth quarter 2009 and 75% in the third quarter 2010.
Brigham's production volumes in the Williston Basin for the fourth quarter 2010 were 9,359 Boepd, which represents a 272% increase from that in the fourth quarter 2009 and a 45% sequential increase from that in the third quarter 2010.
Production volumes include approximately 135 barrels of crude oil per day of inventory build during the fourth quarter.
Williston Basin Operated Well Result Update
The following table updates Brigham's long lateral, high frac stage well results:
Early 24-Hour Peak Flow Back Rate -------------------------- Barrels of Oil County, Working Crude Natural Equivalent Well State Objective Stages Interest Oil (1) Gas (2) (3) ----------- ----------- --------- ------ -------- ------- ------- ---------- Lloyd 34-3 McKenzie, #1H (4) ND Bakken 31 29% 3,240 4.74 4,030 Bratcher McKenzie, 10-3 #1H ND Bakken 30 91% 3,206 2.76 3,667 M. Macklin Williams, 15-22 #1H ND Bakken 38 89% 2,312 1.34 2,534 M. Olson Williams, 20-29 #1H ND Bakken 38 91% 1,936 0.86 2,080 Average 3,078
(1) Barrels of crude oil.
(2) Millions of cubic feet of natural gas (MMcf).
(3) Converted to barrels of oil equivalent using the ratio of six Mcf of natural gas per barrel of crude oil.
(4) Represents joint venture well completed with U.S Energy Corp. (NASDAQ: USEG)
Williston Basin Operated Drilling and Completion Update
Brigham's accelerated development of its acreage in North Dakota and Montana is proceeding with five operated rigs drilling in Rough Rider and two operated rigs drilling in Ross. Brigham's eighth operated rig is currently expected to arrive in May 2011.
Brigham currently has one well flowing back, two wells fracing and ten wells waiting on completion. Brigham is currently fracing the Swindle 16-9 #1H, which is located in Roosevelt County, Montana, and will frac the Johnson 30-19 #1H, which is located in Richland County, Montana, in mid-February.
By mid-April, Brigham expects to add additional fracture stimulation capacity thereby providing access to two fully dedicated frac crews focused on completing Brigham operated horizontal wells in the basin. At that time, Brigham estimates that approximately eight wells per month will be fracture stimulated and brought on line to production.
Management Comments
Bud Brigham, the Chairman, President and CEO, commented, "In our view, the Williston Basin Bakken and Three Forks plays are the highest value resource plays in North America, and our 2010 proved reserve growth clearly demonstrates that Brigham Exploration is a technological leader in these plays. Our record 2010 reserves and production growth reflect the substantial net asset value we've created for investors in 2010. This was achieved at very attractive drilling and leasehold acquisition finding and development costs, which excludes the cost of our field level infrastructure investment, of roughly $10 per proved barrel of oil equivalent. Importantly, given that we're very early in the development of this world class resource, we estimate that we've drilled only 7% of our core de-risked locations across our approximate 205,600 net acres assuming four well spacing per producing horizon. In light of our remarkable transformational year, I want to personally commend our employees for these terrific results, the credit goes to them for their efforts to continue to innovate and be the leader in the Williston Basin."
Bud Brigham continued, "Looking ahead, given the significant drilling inventory remaining on our core acreage, our ongoing drilling to further delineate the economics of our Rough Rider Three Forks and Montana Bakken locations, the potential to increase the number of density wells per spacing unit, and the success we've achieved acquiring additional acreage, I believe that 2010 is just the first of many years of significant, low cost reserve additions for our shareholders. As other companies are striving to become liquids rich, we already have the oil manufacturing machine up and running with 80% of our production volumes driven by high value crude oil. The oil manufacturing machine is expandable as well, as we continue to engage with service providers to ramp up our rig count beyond the eight rigs we will have running by May."
Bud Brigham concluded, "In addition to our efforts to increase our drilling inventory and accelerate the development of the associated net asset value, we have internally developed a number of initiatives that we will test during 2011 to further enhance estimated ultimate recoveries. Furthermore, we are at the very early stages of investigating opportunities to reduce costs through drilling and completion efficiencies. Overall, 2011 looks to be a very exciting year and one in which we anticipate making substantial progress in our goal of 'No Oil Left Behind™.'"
Disclosure Statements
The production and financial information in the release is unaudited and subject to revision. Audited and final results will be provided in our Annual Report on Form 10-K for the year ended December 31, 2010 currently planned to be filed with the Securities and Exchange Commission by the end of February or early March 2011.
About Brigham Exploration
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
Forward-Looking Statement Disclosure
Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements within the meaning of the federal securities laws. Important factors that could cause our actual results to differ materially from those contained in the forward-looking statements early initial production rates which decline steeply over the early life of wells, particularly our Williston basin horizontal wells for which we estimate the average monthly production rates may decline by approximately 70% in the first twelve months of production, our growth strategies, our ability to successfully and economically explore for and develop oil and gas resources, anticipated trends in our business, our liquidity and ability to finance our exploration and development activities, market conditions in the oil and gas industry, our ability to make and integrate acquisitions, the impact of governmental regulation and other risks more fully described in the company's filings with the Securities and Exchange Commission. Forward-looking statements are typically identified by use of terms such as "may," "will," "expect," "anticipate," "estimate" and similar words, although some forward-looking statements may be expressed differently. All forward-looking statements contained in this release, including any forecasts and estimates, are based on management's outlook only as of the date of this release, and we undertake no obligation to update or revise these forward-looking statements, whether as a result of subsequent developments or otherwise.
Contact:
Rob Roosa
Finance Manager
(512) 427-3300
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Operational Update - November 1, 2010
Brigham Exploration Company (NASDAQ: BEXP) announced the completion of three high rate Bakken wells, including the Clifford Bakke 26-35 #1H and the Abelmann 23-14 #1H at early 24-hour peak flow back rates of approximately 5,061 and 4,169 barrels of oil equivalent, respectively. In total, Brigham has completed 39 consecutive high frac stage long lateral Bakken and Three Forks wells in North Dakota with an average early 24-hour peak flow back rate of approximately 2,777 barrels of oil equivalent. Brigham also provided an update on its drilling and completion activities in the Williston Basin.
Ross Project Area Update
In Mountrail County, North Dakota, Brigham announced the completion of the Clifford Bakke 26-35 #1H, which was completed with 38 fracture stimulation stages, at an early 24-hour peak flow back rate of approximately 5,061 barrels of oil equivalent (4,438 barrels of oil and 3.73 MMcf). The Clifford Bakke 26-35 #1H is located two miles to the east of the Anderson 28-33 #1H, which was completed in August 2009 with 24 fracture stimulation stages at an early 24-hour peak flow back rate of 2,154 barrels of oil equivalent. Based on publicly available information, the Clifford Bakke 26-35 #1H appears to represent the second highest initial production rate well in the Williston Basin and Brigham now has the first, second, third and fifth highest initial production rate wells in the basin. To date, Brigham has completed eight Ross project area long lateral Bakken wells at an average early 24-hour peak flow back rate of approximately 3,988 barrels of oil equivalent. Brigham maintains an approximate 43% working interest in the Clifford Bakke 26-35#1H.
Rough Rider Project Area Update
Record Rough Rider Bakken Completion -- In McKenzie County, North Dakota, Brigham announced the completion of the Abelmann 23-14 #1H at an early 24-hour peak flow back rate of 4,169 barrels of oil equivalent (3,745 barrels of oil and 2.55 MMcf). The Abelmann 23-14 #1H was completed with 33 frac stages and, based on publicly available information, appears to represent a record initial production rate well west of the Nesson Anticline. Brigham maintains an approximate 53% working interest in the Abelmann 23-14 #1H.
Rough Rider Increased Density Pilot Project -- In Williams County, North Dakota, Brigham is in the process of flowing back the Brad Olson 9-16 #2H, which is being completed with 32 fracture stimulation stages and represents Brigham's 40th long lateral high frac stage completion. Current flow back results indicate the early 24-hour peak flow back rate will be within the range of early 24-hour peak flow back rates for other Brigham operated Rough Rider wells. Brigham hopes to be able to provide an early 24-hour peak flow back rate on its 3rd quarter 2010 conference call tomorrow morning. Brigham maintains an approximate 56% working interest in the Brad Olson 9-16 #2H, with U.S. Energy Corp. (NASDAQ: USEG) as a working interest participant.
The Brad Olson 9-16 #2H represents Brigham's first infill test west of the Nesson Anticline. By monitoring frac wing performance of the well with a deployed micro-seismic array and monitoring continued well performance, Brigham hopes to delineate the potential to drill incremental infill wells beyond the currently envisioned three wells per spacing unit. If results indicate that four to six wells may be required to effectively drain spacing units, Brigham's de-risked Rough Rider drilling inventory could increase by approximately 120 to 360 net locations, which would represent a significant net asset value enhancement event. Subject to results, Brigham plans to commence additional increased density pilots in Rough Rider and Ross in the first half 2011, including four well density units.
Additional Rough Rider Completion -- Also in Williams County, North Dakota, Brigham announced the completion of the Smith Farm 23-14 #1H, which was completed with 32 fracture stimulation stages at an early 24-hour peak flow back rate of 2,417 barrels of oil equivalent. Brigham maintains approximate 82% working interest in the Smith Farm 23-14 #1H.
Williston Basin Drilling and Completion Update
Brigham's accelerated development of its acreage in North Dakota and Montana is proceeding with three operated rigs drilling in Rough Rider, two operated rigs drilling in Ross and one operated rig drilling in Roosevelt County, Montana. A seventh operated rig is expected to arrive in mid-November, approximately two months ahead of schedule. Brigham's eighth operated rig is currently expected to arrive in May 2011.
Brigham currently has one well flowing back, two wells fracing and nine wells waiting on completion. In the first quarter 2011, Brigham expects to add additional fracture stimulation capacity thereby providing access to two fully dedicated frac crews focused on completing Brigham operated horizontal wells in the basin. At that time, Brigham estimates that approximately eight wells per month will be fracture stimulated and brought on line to production.
Management Comments
Bud Brigham, the Chairman, President and CEO, commented, "We've now drilled 39 consecutive high frac stage long lateral completions in North Dakota averaging 2,777 barrels of oil equivalent over an early 24-hour peak flow back period. The outperformance of our wells once again resulted in our exceeding the high end of our production volume guidance, and we also achieved record quarterly production volumes of 8,509 barrels of oil equivalent per day during the third quarter. Furthermore, during the third quarter, our high value oil production volumes continued to grow and represented approximately 75% of our total production volumes and 87% of our pre-hedge revenues, which drove our revenue and cash flow to record levels during the quarter. We're even more excited about the potential for strong fourth quarter production volume growth given the three wells we recently brought on line and our plans to complete approximately six wells per month in the Williston Basin during the quarter. We currently anticipate achieving between 20% and 27% sequential production volume growth during the fourth quarter and therefore expect our volumes to average between 10,200 to 10,800 barrels of oil equivalent per day."
Bud Brigham continued, "We've moved an operated rig into Montana and are currently drilling the Swindle 9-16 #1H in Roosevelt County about seven miles east of our Rogney well. We will subsequently move the rig to Richland County, Montana to drill the Johnson 30-19 #1H, which is approximately seven to eight miles northwest of our Sedlacek Trust 33-4 #1H. We're excited about the opportunity to complete two additional Montana wells early in 2011 in an effort to further de-risk portions of our approximately 105,400 net acres in the area."
Bud Brigham concluded, "Our Brad Olson 9-16 #2H and #3H, which will be completed later this year, could provide yet another potential catalyst for net asset value growth. As we've increased the number of frac stages while pumping the same amount of ceramic proppant, we potentially have decreased the length of our frac wings and increased our drainage efficiency along the length of the wellbore. By analyzing the results of our deployed micro-seismic array and ongoing monitoring of well performance, we hope to determine whether we may have the opportunity to drill more than our currently planned three wells per spacing unit. If we can drill four to six wells per spacing unit, in our Rough Rider area alone our de-risked development drilling inventory could increase by approximately 120 to 360 net wells, which would represent a significant net asset value enhancement."
Conference Call Information
Our management will host a conference call to discuss operational and financial results for the third quarter 2010 with investors, analysts and other interested parties on Tuesday, November 2, at 11:00 a.m. Eastern Time. To participate in the call, participants within the U.S. please dial 888-713-4218 and participants outside the U.S. please dial 617-213-4870. The participant passcode for the call is 21582582. Participants may pre-register for the call at https://cossprereg.btci.com/prereg/key.process?key=PVNELWLGV. Pre-registrants will be issued a pin number to use when dialing into the live call which will provide quick access to the conference. A telephone recording of the conference call will be available approximately two hours after the call is completed through 12:00 p.m. Eastern Time on Tuesday, November 9, 2010. To access the recording, domestic callers dial 888-286-8010 and international callers dial 617-801-6888. The passcode for the conference call playback is 42559492. In addition, a live and archived web cast of the conference call will be available over the Internet at either www.bexp3d.com or www.streetevents.com.
About Brigham Exploration
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
Contact:
Rob Roosa
Finance Manager
(512) 427-3300
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August 3, 2010, 4:45 pm EDT
Since late April 2010, Brigham Exploration Company (NASDAQ: BEXP) has expanded its acreage position in the Williston Basin by approximately 52,800 net acres to an estimated 358,200 net acres, which represents a 17% increase in its total Williston Basin acreage. Importantly, Brigham has expanded its core acreage position by an estimated 34,000 net acres, primarily in and around its Rough Rider project area, to a total of approximately 198,400 net acres. Brigham also announced the completion of the Rogney 17-8 #1H, its first Bakken well in its Eastern Montana project area in Roosevelt County, Montana, at an early 24-hour peak flow back rate of 909 barrels of oil equivalent. Finally, Brigham announced the completion of the Michael Owan 26-35 #1H and the Sedlacek Trust 33-4 #1 at early 24-hour peak flow back rates of 2,931 and 2,695 barrels of oil equivalent, respectively.
Growth in Williston Basin Acreage
In addition to its ongoing organic leasing efforts, Brigham completed four separate acreage acquisition transactions, expanding its Williston Basin acreage position by approximately 52,800 net acres since late April to an estimated 358,200 net acres. Approximately 23,800 net acres were added to its Rough Rider project area in Williams and McKenzie County, North Dakota. In addition, approximately 9,900 net acres were added in far eastern Richland County, Montana, very proximate to Brigham's Sedlacek Trust well, which had an early 24-hour peak rate of 2,695 barrels of oil equivalent. As a result, Brigham's core acreage position west of the Nesson Anticline in Rough Rider and in far Eastern Montana has grown by approximately 27% to an estimated 156,700 net acres. An additional 300 net acres were added east of the Nesson Anticline in the Ross project area in Mountrail County, North Dakota. Together, this represents an increase of 34,000 net acres in its core acreage in the Williston Basin to approximately 198,400 total net core acres. As a result of these acreage additions, Brigham has increased its core acreage drilling locations by an estimated 81 net locations to approximately 574 total net locations.
Separate from the aforementioned core acreage additions in far eastern Richland County, Montana, Brigham added approximately 17,300 additional acres in its Eastern Montana project area further west from the Sedlacek Trust well in Richland County. The remaining 1,500 net acres acquired in Eastern Montana are located in Roosevelt County.
Initial Brigham Operated and Non-Operated Montana Bakken Discoveries
Brigham announced the completion of its operated Rogney 17-8 #1H in its Eastern Montana project area in Roosevelt County at an early 24-hour peak rate of approximately 909 barrels of oil equivalent. Given that this was Brigham's initial test in the area, the initial nine frac stages, or approximately 30% of the horizontal wellbore, were stimulated at lower frac pump rates. However, as a consequence the well produced at low initial flow rates. Brigham subsequently treated the remaining 21 frac intervals at higher frac pump rates and, when commingled with the initial nine intervals, the well produced 909 barrels of oil equivalent in an early 24 hour period. Currently the Rogney is flowing at a rate of approximately 400 barrels of oil equivalent per day.
Also in Montana and approximately 17 miles southeast of the Rogney, Brigham participated with a small working interest in the Zenergy Luke Sweetman, which was completed with 23 frac stages. The Luke Sweetman commenced production in late April at an early 24-hour peak rate of approximately 1,201 barrels of oil equivalent per day, after 100 days had produced roughly 30,000 barrels of oil and was recently producing approximately 320 barrels of oil equivalent per day. Brigham will continue to monitor the performance of the Rogney and other surrounding wells, and plans on spudding its next Montana operated well, the Gobbs 17-8, approximately five miles east of the Rogney in November.
Update on Accelerating North Dakota Bakken and Three Forks Operational Activity
Brigham announced the completion of its operated Michael Owan and Sedlacek Trust wells at early 24 hour peak flow back rates of 2,931 (2,640 Bopd and 1.75 MMcf/d) and 2,695 (2,413 Bopd and 1.69 MMcf/d) barrels of oil equivalent, respectively. Both wells are located in Brigham's Rough Rider project area. Notably, the Sedlacek Trust represents the southwestern most well to date of Brigham's acreage in its Rough Rider project area. The Michael Owan and Sedlacek Trust were treated with 33 and 30 frac stages, respectively. Brigham maintains an approximate 87% interest in the Michael Owan and an approximate 48% working interest in the Sedlacek Trust. The Sedlacek Trust was completed with U.S. Energy Corp. (NASDAQ: USEG) as well #10 under the terms of the 15 well Drilling Participation Agreement entered into last year. Brigham's interest in the wells drilled with U.S. Energy Corp. will increase after payout.
Brigham's accelerated development of its core operated acreage in its Rough Rider and Ross project areas is proceeding with five operated rigs drilling, four of which are located in Rough Rider with an additional rig located in Ross. The next operated rig is expected to arrive October 1st and is expected to drill wells in the Ross project area. Additional operated rigs are expected to arrive in January and May 2011 after which Brigham will have eight operated rigs running in the Williston Basin. In terms of operated well completions, one well is currently flowing back after frac, one well is fracing and nine wells are waiting on completion.
Access to an incremental 50% of a frac crew is expected this month and at that time the pace of Brigham operated completions is expected to accelerate. In December 2010 or January 2011, Brigham is expected to gain access to an additional 50% of a frac crew and at that time Brigham will have two fully dedicated crews fracing Brigham operated wells at all times.
Brigham is also actively constructing infrastructure in both the Rough Rider and Ross project areas. In Rough Rider, crude oil, water disposal and fresh water pipelines are being laid. It is expected that Brigham will lay approximately 70 miles of each of these lines. All lines are anticipated to be operational by the second quarter 2011. Additionally, a pipe yard is currently under construction and a water disposal well will be drilled in the near future, both near Williston, North Dakota. In Ross, water disposal lines are being laid, a water disposal well has been drilled and the disposal facility is being constructed. It's expected that the water disposal system will be operational in the next 60 days.
Management Comments
Bud Brigham, the Chairman, President and CEO, commented, "Our Land Department exceeded all expectations by delivering approximately 52,800 net Williston Basin acres to our stockholders, an estimated 34,000 of which are in our core areas, since our last acreage update in April. This acreage was delivered at an average cost of approximately $1,000 per acre, which represents a substantial discount to the per acre cost of a recent industry merger transaction in the Williston Basin and represents a significant net asset value creation event. In total, we estimate that 81 net drilling locations were added to our de-risked core drilling inventory. Our successful long lateral high frac stage drilling formula has delivered 28 consecutive high production rate North Dakota Bakken and Three Forks wells at an average early 24-hour peak rate of 2,659 barrels of oil equivalent. We believe these results have made us an operator of choice in the Rough Rider project area and have assisted in our ability to close meaningful acreage transactions over a two month period."
Bud Brigham continued, "Inclusive of our Rogney test, we now have three apparent Bakken discoveries proximal to our largest acreage block in our Eastern Montana project area. Apparently EOG has completed and is producing the Carat well immediately offsetting our acreage to the north. In addition, the Zenergy Luke Sweetman well, in which we have a small working interest, has now produced for approximately 100 days and is providing encouraging early performance to the southeast. Furthermore, well spacing activity has increased significantly in Eastern Montana with 78 units applied for by other operators at the June and August spacing hearings. The vast majority of these units are just east and north of our acreage block. We've learned a great deal from the Rogney that we will benefit from in our subsequent drilling. The initial nine frac stages were pumped at lower frac rates, reducing the productivity of that portion of the stimulation. The remaining 21 frac stages produced much better results relative to the initial nine stages. We'll of course continue to evaluate the core results of the Rogney and monitor the well's performance, and very much look forward to commencing our second operated test during the fourth quarter."
Bud Brigham continued, "Exciting activity is underway in Rough Rider with our first Three Forks well and first Bakken infill well drilling ahead. Our Three Forks well is being drilled in the same unit as our State 36-1 Bakken well, which commenced production in January 2010 at an initial rate of approximately 3,807 barrels of oil equivalent per day. Success with the State 36-1 Three Forks well would complement third party operated Three Forks discoveries proximal to Rough Rider and potentially further de-risk approximately 344 net Three Forks locations in Rough Rider. Additionally, we are currently drilling our first Bakken infill well in our Brad Olson 9-16 spacing unit and will deploy a micro seismic array to monitor the propagation of our frac wings. Monitoring frac wing performance could enable us to better understand the ultimate number of locations that are available to fully develop each spacing unit. As we have kept the amount of proppant placed in the formation for each well constant while increasing the number of frac stages, it's likely we have more effectively stimulated the near well bore area, while reducing the length of our frac wings. If we are more effectively stimulating the near well bore area, we may have the opportunity to drill more than the currently envisioned three wells per spacing unit."
About Brigham Exploration
Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. For more information about Brigham Exploration, please visit our website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
Contact:
Rob Roosa
Finance Manager
(512) 427-3300
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Brigham Exploration Company Investor Presentation April 2008
http://www.bexp3d.com/IR_pres.pdf
Brigham Exploration Company Q4 2007 Earnings Call Transcript, 03 04 08
http://tinyurl.com/2zgzcl
DUE DILIGENCE - EXTERNAL
Williston Basin [North Dakota] sets pace for sales of oil, gas leases
http://209.157.64.201/focus/f-news/1571175/posts
"The U.S. Is Poised to Hit a New Oil Gusher" 03 17 08
By Jim Ostroff, Associate Editor, The Kiplinger Letter
http://tinyurl.com/yqbgcd
"North Dakota -- the next Saudi Arabia"
http://tinyurl.com/3ebkvh
Williston Basin - From Wikipedia
http://en.wikipedia.org/wiki/Williston_Basin
Bakken Formation - From Wikipedia
http://en.wikipedia.org/wiki/Bakken_Formation
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