At Eugene Island 312, the #1 well, drilled to a total depth of 8,110 feet and encountered approximately 70 feet of apparent high quality natural gas pay in a single interval. The #1 well, which was a moderate risk, moderate potential well, is expected to be on line by mid- year 2007. Hunt Petroleum (AEC), Inc. ("Hunt"), the operator, holds a 60% working interest in the well and EPL holds the remaining 40%.
The Company also announced an exploratory success in the South Timbalier 41/42 area with the South Timbalier 42 #2 well. This well successfully encountered its intended four development objectives and in addition found two new pay intervals in that section of the well. This moderate risk, moderate potential well drilled to a total depth of 19,500 feet and encountered a total of 150 feet of high quality apparent oil and natural gas pay. The Company said that the well encountered better than predicted pay intervals in both number and footage, and as a result will add new reserves this year. After securing all pay intervals by running casing, an attempt to drill deeper to test additional exploratory potential was aborted due to adverse hole conditions. The next planned exploratory well in this area, the high potential South Timbalier 42 #3, will target sands deeper than those tested in the South Timbalier 42 #2. This most recent well marks the seventh success in seven exploratory tests in the South Timbalier 41/42 area since the first well was drilled in 2003. Both this new well and last year's discovery, the South Timbalier 42 #1, are expected be on line in the third quarter of 2006. EPL, the operator, holds a 60% working interest in the well and Kerr-McGee holds the remaining 40%.
In the Greater Bay Marchand area, the SB15 #3st well, drilled to a total depth of 11,306 feet and encountered approximately 100 feet of apparent high quality oil pay in a single interval. The well, which was a low risk, moderate potential well, is expected to be on line later this year. EPL holds a 27% working interest in the well.
In addition, the Company announced the high potential, high risk well at West Cameron 25 did not encounter hydrocarbons. The well, in which the Company held a 100% working interest, was drilled to a total depth of 11,373 feet. EPL expects to recognize approximately $8.6 million in exploration expense in the second quarter of 2006 attributable to this well.
EPL currently has exploratory tests underway on the Shelf at East Cameron 109 and East Cameron 46.
Onshore in south Louisiana, the Company drilled a successful exploratory test in the Little Lake area. This low risk, moderate potential well is expected on line later this year. This well marks the fourteenth exploratory success of eighteen tests for the Company since the south Louisiana onshore program began on the acreage acquired in early 2005.
Current drilling operations continue at EPL's high risk, high potential Lakeside prospect, that is currently at 14,205 feet and progressing to its intended total depth.
Richard A. Bachmann, EPL's Chairman and CEO, commented, "We are pleased that our drilling program continues to be on track in what is proving to be an exciting year for us. While we are quickly moving forward with the pending acquisition of Stone Energy, which is set to close early in the fourth quarter, we continue to focus on growth through the drill bit by maintaining an active exploratory drilling program in order to deliver value to our shareholders."
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