The Bayou Bengal B #13 commenced producing after stimulation at a rate of approximately 1.1 MMcfe per day from approximately 6 feet of Lower Frio Tex Miss pay, and is currently producing approximately 0.4 MMcfe per day. Brigham plans to add approximately 12 feet of shallower apparent Tex Miss pay to the producing stream. The Bayou Bengal B #13 also encountered approximately 35 feet of apparent net pay in the shallower "F" series Frio sands, which remain behind pipe for future completion.
Brigham is preparing to commence the State Tract 266 #1, the first offset to the Bayou Bengal B #13 and State Tract 254 #1 discoveries. The State Tract 266 #1 is expected to begin drilling in about four weeks, commencing the development of the shallower apparent "F" series Frio pay sands encountered in both wells on an estimated 500 acre structure. Brigham expects to drill additional offsets in 2006, with up to 5 total wells required for full development. Royale Energy, Inc. is a participant in both the State Tract 254 #1 and Bayou Bengal B #13 wells with a 25% working interest.
Subsequent to fracture stimulation, the Wyse #1 began producing formation water along with approximately 0.7 MMcfe per day of natural gas and condensate. Brigham and Penn Virginia are currently evaluating various options, which include but are not limited to attempting to squeeze off the water producing zone which is likely below the Lower Frio pay intervals, or setting a plug above the current pay intervals in order to complete approximately 90 feet of apparent pay in a shallower Lower Frio interval.
2005 OPERATIONAL STATISTICS
Brigham has spud 27 wells thus far in 2005, retaining an average working interest of approximately 57%. Twenty-four of these wells have been or are currently being completed, with three 2005 wells currently drilling. In addition, one 2004 well was recently completed, the Mills Ranch #2-98. Brigham's gross and net completion rate thus far in 2005 is 100%.
2005 PRODUCTION GUIDANCE UPDATE
Brigham currently estimates that its production for the third quarter 2005 averaged roughly 32 MMcfed, up approximately 8% relative to its second quarter 2005 production and within the previously announced guidance range. Brigham estimates that less than 1.0 MMcfed of its average daily production was lost during the third quarter due to pipeline shut-ins resulting from Hurricane Rita. Due primarily to recent completions, Brigham also estimates that production will increase further during the fourth quarter 2005 to record levels, when production is expected to average between 36 and 42 MMcfed. The mid-range of the forecasted fourth quarter production range would represent an increase of 31% relative to Brigham's first half 2005 average production of 29.8 MMcfed. Taking into consideration Brigham's estimated third quarter 2005 production and the mid-point of its current guidance for its fourth quarter 2005 production, Brigham's production for 2005 would average 32.6 MMcfed.
Bud Brigham, the Chairman, President and CEO stated, "Our recent drilling successes, including three potentially substantial Lower Frio field discoveries, are beginning to positively impact our production volumes. Given our recent completions, the significant wells currently completing (the Grisham #1 Lower Frio development well, the Sullivan C-31 Vicksburg development well, and the Wright #2 exploration well), in addition to the very high quality wells we're currently drilling, we expect to exit 2005 with production and reserves at record levels."
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