Houston Exploration Says Production Should Restart in a Few Days

The Houston Exploration Company says that as a result of Hurricane Katrina an estimated 63 MMcfe per day of net production remains shut in, primarily due to pipelines and facilities that are temporarily out of service. The company anticipates the majority of these volumes will be back on stream within the next two to four days. The company estimates that the total quarterly impact will be 620 MMcfe to 700 MMcfe, for a daily net rate of 7 MMcfe to 8 MMcfe. During the second quarter 2005, the Gulf of Mexico accounted for approximately 42 percent of the company's total daily production, and of that, more than 80 percent of the production was located west of the path of the hurricane.

At the time of the storm the company had six rigs running in the Gulf, all of which will be operational in the next three to four days. All of the company's manned facilities have been inspected, and at first assessment, damage appears to be minimal. At Main Pass 264, where the company has a three-well development drilling program, the rig and platform have been boarded and drilling operations are expected to resume within the next three to four days. Operated and non-operated production from Main Pass is expected to be shut in for at least another week, which accounts for 24 MMcfe per day, net.