W&T Offshore Sees 100% Drilling Success in 3Q06

W&T Offshore says since the beginning of the third quarter the company has successfully drilled six out of six wells, including three in the deep shelf. Since the beginning of 2006, the Company has successfully drilled seventeen out of twenty exploration wells and eight out of eight development wells. Two of the development wells, indicated below by an asterisk, were drilled by Kerr-McGee prior to the closing of the transaction.

    Third Quarter to Date Successful Wells:

    Field Name/Well               Category                  Working Interest %
    South Timbalier 206 A-10ST    Exploration / Shelf             25%
    Eugene Island 205 C-3ST       Exploration / Deep Shelf       100%
    Green Canyon 82 #3            Exploration / Deepwater        100%
    East Cameron 321 A-25ST       Development / Shelf            100%
    South Timbalier 41#5*         Exploration / Deep Shelf        40%
    West Cameron 295 #4*          Exploration / Deep Shelf        20%

    Updated Third Quarter and Full-Year 2006 Guidance

W&T is revising its third quarter and full year 2006 estimated guidance to reflect the Kerr-McGee transaction. Currently, we anticipate an 18 percent increase in third quarter production and a 16 percent increase for the full year 2006 over our stand-alone guidance. Approximately 2.8 Bcfe has been deferred resulting from third party pipeline repair delays, primarily at East Cameron 321 and Mississippi Canyon 718. The guidance assumes incremental production and expenses as of September 1, 2006.

    Estimated
     Production       Revised Third   Prior Third     Revised       Prior
                       Quarter 2006   Quarter 2006   Full-Year    Full-Year
                                                       2006          2006
    Crude oil
     (MMBbls)          1.66 - 1.71     1.5 - 1.6    6.4 - 6.6     5.8 - 6.1
    Natural gas (Bcf)  14.7 - 15.2    11.9 - 12.2  60.2 - 62.1   48.2 - 51.1
    Total (Bcfe)       24.7 - 25.5    21.1 - 21.6  98.4 - 101.4  83.0 - 87.7
    Estimated Daily
     Production
     (MMcfe/d)          268 - 277      232 - 237    272 - 278     227 - 240

    Operating
     expenses
     ($ in millions,
     except as
     noted)        Revised Third   Prior Third      Revised         Prior
                    Quarter 2006   Quarter 2006    Full-Year      Full-Year
                                                      2006           2006
    Lease operating
     expenses      $28.5 - $30.1  $22.5 - $24.0  $99.7 - $106.8  $75.3 - $82.3
    Gathering,
     transportation &
     production
     taxes          $4.8 - $5.6    $3.7 - $4.4   $19.8 - $21.3   $15.1 - $16.5
    General and
     administrative $9.4 - $11.4   $8.6 - $10.6  $40.6 - $44.6   $38.0 - 43.0
    Income tax rate,
     % deferred       35%, 80%      35.0%, 80%     35.0%, 80%     35.0%, 80%
For More Information on the Offshore Rig Fleet:
RigLogix can provide the information that you need about the offshore rig fleet, whether you need utilization and industry trends or detailed reports on future rig contracts. Subscribing to RigLogix will allow you to access dozens of prebuilt reports and build your own custom reports using hundreds of available data columns. For more information about a RigLogix subscription, visit www.riglogix.com.
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Brent Crude Oil : $54.46/BBL 0.96%
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