Crimson Presentation Gives Gammage Estimate

Good looks at the San Augustine, Nacagdoches, Sabine area and potential.

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Permalink Reply by Wilma Watts on November 14, 2009 at 3:41
Your comments on the Encana breakup are on point. They have a bunch of stuff to address on the split up right now - i expect management and most employees are focusing on the split first and foremost.

Interesting comments from geologist George Blake and Princeton's Dr. Dreyeffes on the energy sector this morning - first hour of the program. They say crude production peaked in 2005 and natural gas is grossly undervalued at current prices. Entertaining if nothing else, but they make some good points:

http://www.zapatageorge.com/zapatag/web_radio#
Permalink Reply by RBH on November 22, 2009 at 17:58
My broker said they already did the break up
Permalink Reply by ken hatcher on November 14, 2009 at 5:30
Encana has slowed way down in sabine parish on the units shell had started. Theres some serious problems somewhere.
Permalink Reply by Wilma Watts on November 24, 2009 at 2:52
Crimson filed an S-1 with the SEC. They will drill 12 wells in the South Haynesville prospect next year - exciting. And they upgrade their stock listing to the NASDAQ. Details in the filing as follows -


Our Company

Crimson is an independent energy company engaged in the acquisition, exploitation, exploration and development of natural gas and crude oil properties. We have historically focused our operations in the onshore U.S. Gulf Coast and South Texas regions, which are generally characterized by high rates of return in known, prolific producing trends. We have recently expanded our strategic focus to include longer reserve life resource plays that we believe provide significant long-term growth potential in multiple formations.

In late 2008 and early 2009, we acquired approximately 12,000 net acres in East Texas where we completed our first well, the Kardell #1H, in October 2009. This well targeted the Haynesville Shale and initially produced 30.7 MMcfe/d, which we believe to be the highest publicly announced initial production rate to date in that formation. In addition to the Haynesville Shale, we believe this acreage is equally prospective in the Bossier Shale and James Lime formations where industry participants have drilled successful wells on adjacent acreage.

In 2007, we acquired approximately 2,800 net acres in South Texas, which we believe is prospective in the Austin Chalk and the Eagle Ford Shale. We drilled our first well on this acreage, the Dubose #1, during the fourth quarter of 2009, and we are preparing to complete the well in the Eagle Ford Shale.

We intend to grow reserves and production by developing our existing producing property base, developing our East Texas and South Texas resource potential, and pursuing opportunistic acquisitions in areas where we have specific operating expertise. We have developed a significant project inventory of over 800 drilling locations associated with our existing property base. Our technical team has a successful track record of adding reserves through the drillbit. Since January 2008, we have drilled 34 gross (15.2 net) wells with an overall success rate of 91% (excluding one well which has not yet been completed).

As of December 31, 2008, our estimated proved reserves, as prepared by our independent reserve engineering firm, Netherland, Sewell & Associates, Inc., were 131.9 Bcfe, consisting of 96.2 Bcf of natural gas and 6.0 MMBbl of crude oil, condensate and natural gas liquids. As of December 31, 2008, 73% of our proved reserves were natural gas, 69% were proved developed and 81% were attributed to wells and properties operated by us. From 2006 to 2008, we grew our estimated proved reserves from 46.4 Bcfe to 131.9 Bcfe. In addition, we grew our average daily production from 7.3 MMcfe/d for the year ended December 31, 2006 to 43.0 MMcfe/d for the nine months ended September 30, 2009. For the nine months ended September 30, 2009, we generated $55.2 million of Adjusted EBITDAX. Our definition of the non-GAAP financial measure of Adjusted EBITDAX and a reconciliation of net income (loss) to Adjusted EBITDAX are provided under “—Non-GAAP Financial Measures and Reconciliations.” For the same period, our net income (loss) was $(16.8) million.

After application of net proceeds of $ from this offering (estimated based upon the midpoint of the range of the offering price on the cover of this prospectus), we expect to have approximately $ million of available borrowing capacity under our revolving credit facility to pursue our 2010 drilling program. Our 2010 capital budget is approximately $55 million, exclusive of acquisitions, of which we expect to spend approximately 76% of our budget on our East Texas and South Texas resource plays and 24% on our existing producing assets. We plan to drill 12 gross (6.0 net) wells in 2010, including 7 gross (3.0 net) wells on our East Texas resource play acreage
Permalink Reply by Wilma Watts on November 24, 2009 at 2:56
Our Strategy

The key elements of our business strategy are:


• Develop our East Texas resource play. We have approximately 12,000 net acres in San Augustine and Sabine Counties of East Texas, which we believe is prospective in the Haynesville Shale, Bossier Shale and James Lime formations. In November 2009, we announced the completion and initial production of our first well on this acreage, the Kardell #1H. The well tested at 30.7 MMcfe/d, which we believe to be the highest publicly reported 24-hour initial production rate for a Haynesville Shale well in Texas or Louisiana to date and is currently flowing to sales. We believe the Kardell #1H confirms the potential of our Bruin Prospect, which is comprised of 3,000 net acres in San Augustine County, resulting in over 100 potential drilling locations in multiple formations. We are currently in the planning stages of several wells in this area and intend to further evaluate and exploit these multiple formations beginning in early 2010. We have an additional 9,000 net acres outside this prospect within Sabine and San Augustine Counties, and we expect to drill our initial well on that acreage in early 2010. We intend to allocate a substantial portion of our capital budget over the next several years to develop the significant potential that we believe exists on our East Texas acreage. Based on our current capital budget, we expect to drill approximately 7 gross (3.0 net) wells in 2010 that will target the Haynesville and Bossier Shales, while retaining future development opportunities in shallower formations.
Permalink Reply by Wilma Watts on November 24, 2009 at 3:08
Permalink Reply by A.C.123 on November 24, 2009 at 15:30
where exactly is Crimson's "Bruin prospect" that they reference.
Permalink Reply by Les Bamburg on November 24, 2009 at 15:53
AC, see my November 10th post with attachment several pages back.
Permalink Reply by A.C.123 on November 24, 2009 at 16:36
Les, thanks. but that area covers quite a bit of central SA county. Was trying to ascertain whether I was in the "Bruin" or not.

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