Replies to This Discussion

Permalink Reply by Wilma Watts on October 15, 2009 at 8:36

Chesapeake investor presentation done yesterday:

http://media.corporate-ir.net/media_files/nys/CHK/presentations/200...

They have a number of slides on the Haynesville play.

Permalink Reply by Wilma Watts on October 23, 2009 at 3:04

From an article published last week, like to see the multiple zone potential:

Many investors assume that an exploration and production company drills, completes and puts a well on production and then that particular lease is done. However, most producing areas in North America and elsewhere have multiple producing pay zones at different depths. An exploration and production company can re-enter a lease and tap a different formation either below or above whichever one is currently producing.

Multiple Pay Zone Players
In the Haynesville Shale, where Goodrich Petroleum (NYSE: GDP ) has acreage, the industry has identified at least five producing formations. These include the James Lime, the Travis Peak, the Bossier Shale, the Cotton Valley and finally the Haynesville Shale.

Goodrich Petroleum originally got into its acreage in East Texas by developing the Cotton Valley or Taylor Sand. The company now has 230 Bcfe of proved reserves here as of December 31, 2008.

Chesapeake Energy (NYSE: CHK ) discussed the Bossier Shale at its recent analyst day. The Bossier Shale overlaps the southern part of the Haynesville Shale, and Chesapeake Energy has 175,000 net acres that are prospective for the Bossier Shale. The company's first test well was the Blackstone 26 H-1, and it had an initial production (IP) rate of 9.4 million cubic feet equivalent per day. A second well is currently being drilled and two more are being planned.

Chesapeake Energy is using what it calls the "superpad" concept, meaning it will drill up to 16 wells from one pad where the Bossier and Haynesville Shale overlap.

Permalink Reply by Wilma Watts on October 27, 2009 at 1:44

Take a look at Cabot's recent presentation on the Haynesville and Pettet/Travis Peak - slide 13 and 14:

http://www.cabotog.com/pdf/090810_Enercom_Oil_Gas_Conference.pdf

Very interesting stuff. They are drilling right where Crimson is according to the plats. And they just announced some very good crude oil IP's in the Pettet / Travis Peak. If crude is in Cabots's wells it will also be on Crimson's wells - CXPO's slides also show this a a potential target zone in their Kardell well - the question is are oil wells with IP's of 800 to 900 bbls per day enough to make this an economic play?

Cabots release this week, bodes very well for CXPO IMO:

HOUSTON, Oct. 26 /PRNewswire-FirstCall/ -- Cabot Oil & Gas Corporation (NYSE:
COG) today announced that its Pettet oil development in Shelby and St.
Augustine counties in east Texas continues to show superior results. Thus far
during 2009, Cabot has drilled four wells targeting the Pettet formation.
Four of these wells have been completed with horizontal intervals covering
between 3,800' to 5,200' with up to 15 frac stages. Individually, these wells
had initial production rates ranging between 815 to 936 barrels of oil per
day, plus natural gas, with 30-day average production rates between 450 - 514
barrels of oil per day.

"This success is exciting in light of the market differentials between oil
prices and natural gas prices," said Dan O. Dinges, Chairman, President and
Chief Executive Officer. "Right now this differential is a multiple of 15:1
and with the well performance, the Pettet is a very economic play."

The Company is currently completing a fifth well and is drilling its sixth
well with plans to drill five additional wells this year in the Pettet.
Overall, the Pettet is currently producing over 1,000 barrels of oil per day
plus 3.7 Mmcf per day. The Company estimates it has 175 to 225 gross Pettet
locations with a potential of 25 - 35 MMBO, plus 100 - 140 Bcf of natural gas.

Permalink Reply by Wilma Watts on November 8, 2009 at 14:02

I just posted this on a DVN board, but maybe I should address it to the Crimson folks. Something does not add up.

Comments welcome.

Here is something to ponder.

Just a thought. Crimson (CXPO) has 12,000 acres in the San Augustine prospect. Most of the leases have 2 years left on the 3 year term.

After the Kardell well if leases fo for $7,500 an acre CXPO's acreage might sell for $5,000 an acre with 2 years left.

Value of CXPO's haynesville leasehold alone would be $60 million. Market cap of the entire company is $50 million.

Something in my calculation does not add up. But I know Chesapeake makes a killing re-selling leasehold positions to third parties. Maybe CXPO will also. Then again, maybe they will lease my lands. Or Devon for that matter, I like the DVN folks, they know their stuff.

Permalink Reply by Les Bamburg on November 9, 2009 at 15:28

Wilma, only 3000 acres are in the Bruin prospect so the market may not place the same value on their entire acreage position.

Permalink Reply by Wilma Watts on November 9, 2009 at 18:48

Thanks guys for the feedback. I really like the folks at Devon, Crimson was smart to tie up with them.

I think the whole acreage position in the south leg of the haynesville for everyone just got more valuable. for small companies i think the impact of the development will be especially noticable.

encana has a conference call this week, they really like the haynesville i am told.

Permalink Reply by Cheerleader on November 9, 2009 at 19:58

Les B,
Where is the Bruin prospect?? Is the acreage continuous at 100% for Crimson and/or Devon??

Permalink Reply by Les Bamburg on November 10, 2009 at 10:11

Cheerleader, Crimson has only made limited reference to the Kardell well being in their Bruin Prospect but it may be depicted on the attached map.

Attachments:

• Crimson Bruin.pdf, 151 KB

Permalink Reply by Cheerleader on November 12, 2009 at 10:48

Les B,
Thanks for the map!!!

Permalink Reply by DR on November 9, 2009 at 17:10

Devon plans to drill ~105 wells to de-risk their southern acreage. Others will do the same. AMIs will be formed to de-risk acreage and potential resources will turn into proven. Imo, Crimson will be worth a whole lot more a year from now.

Permalink Reply by Wilma Watts on November 10, 2009 at 1:38

This should add more ' color' to the haynesville play and what they think:

EnCana Corporation (TSX, NYSE: ECA) will release its third quarter 2009 results and preliminary 2010 budget plans for both the new EnCana Corporation and Cenovus Energy Inc. on Thursday, November 12, 2009.

***
Crimson will hold a call in the next few weeks also I expect.

Permalink Reply by Wilma Watts on November 10, 2009 at 3:51

This was posted elsewhere, interesting take on things, wow - $30k per acre! Is this a pipe dream? I hope not!

*******
Price Of Poker Higher In Haynesville Shale In Southern Part Of Texas

The price of leases left to be leased or to be bought from others holding leases will go higher now because of the huge Devon well in San Augustine County, Texas. Prices could go as high as $30,000 - $50,000 /acre because that is the price that has been paid in Desota Parish, La this year. That Parish doesn't have all the payzones that are present in Sabine, San Augustine and Shelby Counties of Texas. . . .

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