extremely old news pontgibbs, i was hoping you would post the very relevant details, particularily the announcement i think ignore the above and spend some time looking at the releases of the current moment..
HOUSTON, March 13, 2008 (PRIME NEWSWIRE) -- The Meridian
Resource Corporation (NYSE:TMR) today announced its operational budgetary plans for 2008 together with an update on recent activities.
Capital Budget and Plans for 2008
The Capital Budget for 2008 will be funded primarily from cash and operating cash flows derived from projections based on its year-end reserve report and planned projects for the year. Depending on the success of the scheduled drilling activities, it is expected to spend approximately $74 million (excluding approximately $7 million of assumed property sales), with an emphasis on repeatable low-to-moderate risk drilling activities designed to provide substantial growth for the future in both rate and reserves. With the addition of new management and technical staff in the exploration and development division of the Company, we are focusing our efforts to expand proven plays into new areas, reduce our cycle time so that we can succeed or fail smartly and quickly, pushing technical excellence in not only exploration but also drilling and completions to reduce our overall costs.
Our plan for 2008 will focus on strategic acquisitions, emphasize repeatable plays in or around proven areas versus "one-off" projects, grow oil in the near term, and balance project spending on drilling, land and acquiring and re-processing 3-D seismic data to support the company's current projects and to re-load future inventory for 2009 and beyond. Specifically, our plans and areas of focus for 2008 will include: (1) the acceleration of the development as well as the expansion of our east Texas Austin Chalk play; (2) testing of new generation lowto- moderate risk south Louisiana tertiary exploration from newly processed 3-D seismic, including the exploitation of our Weeks Island oil field in south Louisiana; (3) north Louisiana exploitation; and (4) south andcentral Texas oil projects. With this more conservative approach, we have high expectations of not only better success in the near term but the development of lower risk opportunities in our core areas in Texas and Louisiana. Based on our current plans and projections, it is anticipated that we will generate excess cash through the year that will provide the Company the necessary liquidity, together with its low leverage position to take advantage of additional projects, acquisitions and/or joint ventures as the opportunities are presented or developed throughout the year.
East Texas Austin Chalk Meridian is on track with its plans to develop this growing core area. The Company originally acquired an interest in this play as a 50% working interest owner in approximately 7,600 acres during mid-year 2005. The original plan was to develop the Woodbine sand section offsetting the prolific Double A Wells field. Additional objectives were the Austin Chalk and Buda formations. Meridian was granted operatorship of the play and has since developed a current gross acreage position of approximately 83,000 contiguous acres in this play area. This will provide enough acreage for a drilling inventory of up to 80 possible dual lateral well locations. Since initial drilling started in 2006, the Company has drilled or participated in the drilling of eight Austin Chalk wells (six are producing, one is drilling, one is currently completing and about to be tested). The aggregate gross proved reserves discovered as a result of the completed wells, including PUD locations, equal over 50 Bcfe (12 Bcfe net to Meridian). Average wells in the area reportedly recover approximately 3.8 Bcfe, with the best wells recovering as much as 15 Bcfe. This play's contribution to the Company's net proven reserve base has grown from 0% to approximately 11% over the course of the ast 18 months and is projected to be one of the top four cash flow producing fields in the Company. Scheduled wells for 2008 are in the thicker, shallower chalk areas that are expected to produce higher oil ratios than the Company's initial wells that were primarily focused on the original Woodbine test locations. As stated above, two wells are currently being drilled and completed in this area. The BSM No. 5 well (65% WI) has drilled two horizontal laterals with approximate lengths of 5,000 and 5,500 feet measured depth ("MD"), respectively. Currently a liner is being run in the second lateral and is expected to be completed and tested in the coming weeks. The Freeman No. 1 well (84% WI) has completed its first lateral at approximately 5,000 feet MD. The second lateral is currently at a length of approximately 1,400 feet MD, going to a targeted 6,000 feet MD in length. The vertical depth of the Austin Chalk formation in this area is approximately 13,500 feet.
Additionally, Meridian participated in the outside operated BSM A-917 No. 1H, which was a single lateral well that reached a total depth of 18,800 MD. The well was recently tested at 2.8 Mmcf/d with 700 barrels of oil per day. Meridian holds approximately 9% working interest in this well. The key to this project is management of the cost of drilling and completing dual laterals within estimated cost levels and leveraging the large acreage position to increase production and reserves with continual drilling.
We have achieved these goals in a relatively short cycle and, in doing so, believe that with the addition of our recently acquired and constructed new drilling rig, we will be able to maintain a continuous drilling program within this region.
NOW THIS IS THE VERY INTERSTING PART>>>>>>>>>>>>>>>
Levering off the knowledge and experience of the Company in this play, the Company has expanded beyond its currently established boundaries to explore and test acreage located in two separate south-central Texas areas. Meridian is building leasehold positions and has budgeted four test wells in these areas for calendar year 2008. It is anticipated that in these areas, the production will have a higher liquid (oil) content than its current production in the initial wells in east Texas. The expanded play areas are unproven and in the early stage, therefore, as they are tested, the Company will release additional details on these opportunities as they develop.
also if you listen to the webcast of meridian, you will hear them mention the south central texas play, and it mentions they are not disclosing anything on it, which fits with my conversations the other day with meridian.. still unable to talk about the area as they are aquiring acreages!! meridian said they examined over 50 small to large projects last year, and its focus is on projects that will immediately fit their ideals, which are fast turnarounds on the wells and production.. they are utilizing the experience of the chalks to develop plays similar to their current plays..
if you are keen to learn a little about what meridian is about, and chalks plays, its a good listen and you learn a lot, these guys are impressive to listen to.
ADI Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
(20min delay)