Dune Energy
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Address
3050 Post Oak Blvd.
Suite 695
Houston, TX 77056
U.S.A.
Tel 713-888-0895
Fax 713-888-0899
Web http://www.duneenergy.com
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Capex
Future Plans
Dune Energy, Inc. is forecasting 2008 production of approximately 20 Bcfe, or an average of 55 MMcfe/day. In 2007 Dune produced approximately 9.0 Bcfe, with 3.8 Bcfe produced in the fourth quarter.
Currently 40% of Dune's production is oil, with the remainder being natural gas. During the final week of the year, Dune's production averaged 44 MMcfe/day. The year-end full capacity rate was 52 MMcfe/day.
2008 Overview
Dune intends to maintain a 1-2 rig program in the Barnett Shale of North Texas during 2008. At Garden Island Bay the company are evaluating facilities upgrades to allow for increased oil production capacity. Additionally, a newly reprocessed 3-D survey will be used to design an 8-10 well shallow drilling program to commence later in the year. This drilling program will be similar to the program completed in 2007 which resulted in production increasing from 4-5 MMcfe/day at the beginning of the year to 13-14 MMcfe/day at the end of the year. Dune are evaluating the possibility of acquiring a new 3-D survey in order to evaluate the high impact deeper sections for future drilling. To date, few penetrations have been made below 12,000 feet and none below 15,000 feet in the field. At Bayou Couba, Dune anticipate drilling at least one additional well later in the year, along with several workovers. A 3-D depth migration, currently being processed, will be used to refine the location of this well and evaluate deeper potential including sub-salt prospects. At Chocolate Bayou, Dune will consider drilling additional wells after evaluation of the results of the Weiting #30 currently being drilled.
2008 Upside Opportunities
It is important to note that Dune has not forecast any incremental production volumes from exploratory drilling in 2008. Should the deep section of the Chocolate Bayou well be successful, significant additional volumes could be achieved. Dune could potentially initiate drilling deeper prospects at both Bayou Couba and Garden Island Bay that could add meaningful volumes late in the year. If testing is successful at the company's Delaware Deep Prospect in Sweetwater County Wyoming, volumes could commence by mid year. Dune are always evaluating outside opportunities that could add near term volumes.Production
Dune Energy, Inc. is forecasting 2008 production of approximately 20 Bcfe, or an average of 55 MMcfe/day. In 2007 Dune produced approximately 9.0 Bcfe, with 3.8 Bcfe produced in the fourth quarter.
Production volumes in the fourth quarter of 2007 were 281 Mbbls of oil and 2.15 Bcf of natural gas, or 3.8 Bcfe for the fourth quarter and 9.0 Bcfe for the full year 2007. This compares with 17 Mbbls of oil and 0.43 Bcf of natural gas, or 0.53 Bcfe for the fourth quarter of 2006, and 1.1 Bcfe for the full year 2006. In 2007, the average sales price per barrel of oil was $76.14, and $7.25 per Mcf for natural gas, as compared with $59.77 per barrel and $5.99 per Mcf, respectively, in 2006.
During the final week of 2007, Dune's production averaged 44 MMcfe/day. The year-end full capacity rate was 52 MMcfe/day.
Reserves
Dune Energy Inc. announced year end 2007 reserves totaled 175 Bcfe, consisting of 117 Bcf of natural gas and 9.6 MMbbls of oil. Approximately 67% of the reserves are natural gas. Proforma for the acquisition of Goldking Energy Corporation in May 2007, year end 2006 reserves totaled 142 Bcfe. Prior to the Goldking transaction, Dune reported proved reserves of 29.7 Bcfe at year end 2006. The reserve report was prepared by DeGolyer and McNaughton, an independent reservoir engineering firm.
Proved developed producing reserves (PDP) totaled 58.1 Bcfe, Proved Developed Non-Producing (PDNP) was 60.4 Bcfe, and Proved Undeveloped (PUD) was 56.2 Bcfe. A significant portion of the PDNP (behind pipe) reserves are associated with wells in the company's Chocolate Bayou, Comite, and Garden Island Bay fields, which were drilled prior to year end but have not yet commenced production. The SEC Present Value (PV@10%), based on year end pricing of $7.33/Mcfe and $92.66/bbl, totaled $733.1MM. On a proforma basis, Dune replaced approximately 354% of 2007 production of 12.9 Bcfe.
Who's Who
Alan Gaines
Chairman and Chief Executive Officer
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Dr. Amiel David
President and Chief Operating Officer
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Hugh Idstein
Chief Financial Officer
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Richard M. Cohen
Director and Secretary
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Valery Georgievich Otchertsov
Director
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Steven Barrenechea
Director
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Raissa S. Frenkel
Director
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Steven M. Sisselman
Director
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Marshall Lynn Bass
Director
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Offices
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