Pioneer to Shut In Canyon Express Gas System Shut for Repair

Pioneer Natural Resources reports that production from the Canyon Express gas system was shut in during early December as a result of a leak in the methanol delivery system. Pioneer initially expected that the production impact would be minimal; however, difficulties in locating the leak have delayed repair operations. The methanol delivery line was located on January 1, and while the exact cause is still under investigation, it appears to be the result of structural damage caused by accidental impact. Pioneer believes that the repair costs should be recoverable by insurance.

TOTAL E&P USA, INC. is the operator of the Canyon Express system, and several options for repairing the leak are under evaluation. The timeframe required for completing the repair will depend on the option selected. Assuming that undue delays are not encountered in contracting for the services required to complete the repairs, Pioneer currently anticipates that production from Canyon Express should resume in approximately 30 days. Initial daily production rates are expected to vary as the methanol delivery system is cleared of water and debris associated with the leak and the repair operations.

Pioneer's share of net gas production from Canyon Express was averaging approximately 90 million cubic feet per day prior to being shut in. The impact to the Company's fourth quarter average daily production is expected to be approximately 5,000 barrels oil equivalent (BOE), leaving total production for the quarter at the lower end of Pioneer's forecasted production range of 190,000 to 205,000 BOE per day.