Development and Exploration Budget Set at $900 Million by Denbury
Denbury Resources' 2008 development and exploration budget (excluding acquisitions) is currently set at $900 million. The current 2008 program includes an estimated $245 million to acquire the 24-inch pipe and right-of-ways for its proposed carbon dioxide pipeline from Louisiana to Texas (the "Green Pipeline") and another $80 million for the carbon dioxide pipeline from Tinsley to Delhi Fields ("Delta Pipeline"). The Company expects to spend an additional $450 million constructing the Green Pipeline during 2009, making its current anticipated total cost for that line approximately $700 million. Currently, over 50% of the remaining portion of our 2008 budget is expected to be spent on other tertiary related operations, over 25% in the Barnett Shale area, and the balance in other areas. As a result of the higher liquid recoveries from the Barnett Shale production in the fourth quarter of 2007, the Company is increasing its 2008 production forecast by 1,500 BOE/d to 49,000 BOE/d. This production target represents a 25% increase in production over the Company's 2007 production levels after adjusting for the Louisiana property sale. Production from the Company's tertiary operations is expected to increase from a 2007 average of 14,767 BOE/d to a projected 2008 range between 22,000 BOE/d and 25,000 BOE/d, a 59% increase based on the mid-point of the range.
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