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Released February 14, 2018 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Denbury Resources Incorporated (NYSE:DNR) (Plano, Texas), an exploration and production company that focuses on enhanced oil recovery (EOR) operations, is ready to build on last year's growth with continued development in some of its most profitable areas. The company expects its 2018 capital spending to total between $300 million and $325 million, compared with $241 million in 2017. Industrial Info is tracking more than $1 billion in active projects across the U.S. involving Denbury Resources.
Total production is estimated to be between 60,000 and 64,000 barrels of oil equivalent per day (boe/d), compared with 60,298 boe/d in 2017. Production in 2017 was down 4% from 2016, although the average production of 61,000 boe/d in the fourth quarter was about 1% higher than that of fourth-quarter 2016. Proved reserves totaled 260 million boe, a 127% replacement of annual production.
"Our 2017 accomplishments improved the full spectrum of our business, positively positioning us heading into 2018," said Chris Kendall, the chief executive officer of Denbury, in a quarterly press release. "We returned to production growth in the third quarter and are set to continue that growth in 2018. We strengthened our core, replacing 127% of our 2017 production."
Kendall noted that the company is highly focused on reaching an investment decision on its initial enhanced oil recovery (EOR) development at Cedar Creek Anticline in Montana in the first half of the year. The Cedar Creek Anticline was the site of one of Denbury's biggest accomplishments in 2017: its first Mission Canyon exploitation well, which had 30-day initial production rate of 1,050 barrels per day (BBL/d) of oil. The company plans to drill six additional wells this year. Industrial Info is tracking the proposed, $225 million EOR pipeline extension and $75 million field conversion and separating/recycling plant that are key elements of the Cedar Creek project.
The pipeline would run 130 miles through eastern Montana, from an interconnection with the Bell Creek EOR field's Greencore CO2 Pipeline to the Cedar Creek Anticline, which is close to Montana's border with South Dakota. The Belle Creek field, which has estimated reserves of 30 million barrels of crude oil, would be converted to a CO2 flooding field, in which carbon dioxide (CO2) is injected into an oil reservoir to boost output. For more information, see Industrial Info's project reports on the proposed pipeline and field conversion.
Denbury's estimated proved CO2 reserves at the end of 2017 totaled 6.4 trillion cubic feet, of which 1.2 trillion is in the Rocky Mountain region and 5.2 trillion is in the Gulf Coast region. The company is considering a proposed, $100 million fourth phase and $100 million fifth phase expansion of its Hastings CO2 Separation & Recycling Plant in Alvin, Texas. Each phase would involve the construction of a 100 million standard-cubic-foot-per-day train to separate CO2 and crude oil, and to recycle and re-inject CO2, to aid in the conversion of Denbury's Hastings field into a CO2 flood EOR field, similar to the Montana project. For more information, see Industrial Info's project reports for Phase IV and Phase V.
Denbury also has an overriding royalty interest (equivalent to roughly 33% ownership interest) in Exxon Mobil Corporation's (NYSE:XOM) (Irving, Texas) CO2 reserves in LaBarge Field in southwestern Wyoming. Denbury is considering a proposed, $500 million CO2 pipeline that would run 240 miles from its Riley Ridge Natural Gas Processing Plant near Big Piney, Wyoming, to an interconnection with the Greencore Pipeline southeast of Lost Cabin, in central Wyoming.
The company also is considering a $60 million expansion of the Riley Ridge plant that would double capacity to 200 million standard cubic feet per day. But both proposals remain in the permitting phases, and Industrial Info rates both at a low probability (0% to 69%) of kicking off within the next two years. For more information, see Industrial Info's project reports on the pipeline and plant expansion.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
Total production is estimated to be between 60,000 and 64,000 barrels of oil equivalent per day (boe/d), compared with 60,298 boe/d in 2017. Production in 2017 was down 4% from 2016, although the average production of 61,000 boe/d in the fourth quarter was about 1% higher than that of fourth-quarter 2016. Proved reserves totaled 260 million boe, a 127% replacement of annual production.
"Our 2017 accomplishments improved the full spectrum of our business, positively positioning us heading into 2018," said Chris Kendall, the chief executive officer of Denbury, in a quarterly press release. "We returned to production growth in the third quarter and are set to continue that growth in 2018. We strengthened our core, replacing 127% of our 2017 production."
Kendall noted that the company is highly focused on reaching an investment decision on its initial enhanced oil recovery (EOR) development at Cedar Creek Anticline in Montana in the first half of the year. The Cedar Creek Anticline was the site of one of Denbury's biggest accomplishments in 2017: its first Mission Canyon exploitation well, which had 30-day initial production rate of 1,050 barrels per day (BBL/d) of oil. The company plans to drill six additional wells this year. Industrial Info is tracking the proposed, $225 million EOR pipeline extension and $75 million field conversion and separating/recycling plant that are key elements of the Cedar Creek project.
The pipeline would run 130 miles through eastern Montana, from an interconnection with the Bell Creek EOR field's Greencore CO2 Pipeline to the Cedar Creek Anticline, which is close to Montana's border with South Dakota. The Belle Creek field, which has estimated reserves of 30 million barrels of crude oil, would be converted to a CO2 flooding field, in which carbon dioxide (CO2) is injected into an oil reservoir to boost output. For more information, see Industrial Info's project reports on the proposed pipeline and field conversion.
Denbury's estimated proved CO2 reserves at the end of 2017 totaled 6.4 trillion cubic feet, of which 1.2 trillion is in the Rocky Mountain region and 5.2 trillion is in the Gulf Coast region. The company is considering a proposed, $100 million fourth phase and $100 million fifth phase expansion of its Hastings CO2 Separation & Recycling Plant in Alvin, Texas. Each phase would involve the construction of a 100 million standard-cubic-foot-per-day train to separate CO2 and crude oil, and to recycle and re-inject CO2, to aid in the conversion of Denbury's Hastings field into a CO2 flood EOR field, similar to the Montana project. For more information, see Industrial Info's project reports for Phase IV and Phase V.
Denbury also has an overriding royalty interest (equivalent to roughly 33% ownership interest) in Exxon Mobil Corporation's (NYSE:XOM) (Irving, Texas) CO2 reserves in LaBarge Field in southwestern Wyoming. Denbury is considering a proposed, $500 million CO2 pipeline that would run 240 miles from its Riley Ridge Natural Gas Processing Plant near Big Piney, Wyoming, to an interconnection with the Greencore Pipeline southeast of Lost Cabin, in central Wyoming.
The company also is considering a $60 million expansion of the Riley Ridge plant that would double capacity to 200 million standard cubic feet per day. But both proposals remain in the permitting phases, and Industrial Info rates both at a low probability (0% to 69%) of kicking off within the next two years. For more information, see Industrial Info's project reports on the pipeline and plant expansion.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
