Berry Petroleum to Acquire Stake in Niobrara Gas Acreage

Niobrara Play, Northeastern Denver Basin
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Berry Petroleum has entered into an agreement to purchase a 50% working interest in 345,000 prospective acres from Bill Barrett Corporation. Berry and Bill Barrett Corporation will jointly explore and develop shallow Niobrara gas assets on the acreage, which is located in eastern Colorado, western Kansas and southwestern Nebraska (the Tri-State acreage). Berry will pay approximately $5 million for its 50% working interest in the acreage. Drilling of the initial obligatory two test wells is scheduled to begin in the first quarter of 2005.

Robert F. Heinemann, president and CEO of Berry Petroleum, said, "This acreage is located immediately east of our pending acquisition of gas assets from J-W Operating Company. It provides us with a larger footprint in what will be Berry's newest core producing asset, the Niobrara gas field. The upside potential on the Tri-State acreage complements the producing assets in Yuma County, both technically and operationally, and strengthens the probability of achieving our goal of adding significant natural gas production and reserves to Berry's asset portfolio. We are delighted to be partnering again with Bill Barrett Corporation, given their proven track record of discovering and developing natural gas in this region."

A plan is under development to evaluate the total acreage, with Bill Barrett Corporation initially conducting and operating the seismic programs and, ultimately, drilling the first test wells. Berry will operate the wells once production is established. Mr. Heinemann added, "After closing, we anticipate capital expenditures on this project in 2005 to be in the range of $2 to $5 million. Closing is expected within 10 days."

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