HOUSTON, Jan. 9 /PRNewswire-FirstCall/ -- W&T Offshore, Inc. (NYSE: WTI) today provided an update on its recent drilling success as well as 2008 capital budget.
For full year 2007, the Company successfully drilled 6 of 7 exploration wells, for a success rate of 86%, which included four out of five conventional shelf wells, and one on the deep shelf and one in the deepwater. Additionally, the Company successfully drilled two of two development wells, both of which were on the conventional shelf. For the 2007 drilling program of 9 total wells, W&T achieved a success rate of 89%.
During the fourth quarter, W&T Offshore successfully drilled three exploration wells: Lease Name/Well Category Working Interest % Green Canyon 82 #4 Exploration / Deepwater 100% Ship Shoal 300 A-1ST Exploration / Shelf 75% Ship Shoal 300 A-3ST Exploration / Shelf 75% In the fourth quarter, the Company drilled one non-commercial well: Lease Name/Well Category Working Interest % Main Pass 162 A-3 Exploration / Shelf 67%
"Our 2007 success rate of 89% for all wells drilled is in-line with our historic rates," said Tracy W. Krohn, Chairman and Chief Executive Officer. "At the beginning of 2007, we made a conscientious decision to cut back on our drilling program and focus on restructuring our debt and significantly enhancing our liquidity. After our successful bond offering this summer, we announced plans to ramp up drilling activities to take advantage of our free cash flow and declining drilling costs. By year end, we successfully drilled 8 of 9 wells and are currently drilling on four additional wells that should be finished drilling in the next couple of weeks," said Mr. Krohn. "One of the successful wells we drilled was our Green Canyon 82 Healey #4 deepwater well. We have completed the drilling portion of the well and are evaluating our findings currently. While it is too early to discuss specifics about the discovery, we anticipate making further announcements during our year-end conference call in February."
Capital and Major Expenditure Budget: The Board of Directors has approved the Company's 2008 budget ("Budget") of $800 million. The 2008 Budget represents a 77% increase over the Company's revised 2007 budget of $453 million. The Budget includes capital to drill 50 wells, including 44 exploration and 6 development wells. Of those wells, 40 are on the conventional shelf and 10 are in the deep shelf or deepwater. We anticipate fully funding our Budget with internally generated cash flow.
Category Amount in $MM % Exploration $330 41% Development 450 56% Seismic 20 3% Total $800 100%
"As I've mentioned before, it takes around two years to review and evaluate a transaction of the size of Kerr-McGee and our 2008 Budget is consistent with that statement. In 2008, over half of the wells budgeted to be drilled are on the former Kerr-McGee properties," continued Mr. Krohn. "The Company is clearly committed to drilling in 2008 and we look forward to an exciting year with the drill bit."
About W&T Offshore
Founded in 1983, W&T Offshore is an independent oil and natural gas company focused primarily in the Gulf of Mexico, including exploration in the deepwater, where it has developed significant technical expertise. W&T has grown through acquisition, exploitation and exploration and now holds working interests in over 200 fields in federal and state waters and a majority of its daily production is derived from wells it operates. For more information on W&T Offshore, please visit its Web site at http://www.wtoffshore.com
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements reflect our current views with respect to future events, based on what we believe are reasonable assumptions. No assurance can be given, however, that these events will occur. These statements are subject to risks and uncertainties that could cause actual results to differ materially including, among other things, market conditions, oil and gas price volatility, uncertainties inherent in oil and gas production operations and estimating reserves, unexpected future capital expenditures, competition, the success of our risk management activities, governmental regulations and other factors discussed in our Annual Report on 10-K for the year ended December 31, 2005 (http://www.sec.gov).
Contacts: Manuel Mondragon, Vice President of Finance firstname.lastname@example.org 713-297-8024
Ken Dennard / email@example.com Lisa Elliott / firstname.lastname@example.org DRG&E / 713-529-6600
SOURCE W&T Offshore, Inc. 01/09/2008 CONTACT: Manuel Mondragon, Vice President of Finance of W&T Offshore +1-713-297-8024, email@example.com Ken Dennard, firstname.lastname@example.org Lisa Elliott, email@example.com both of DRG&E +1-713-529-6600, for W&T Offshore Web site: http://www.wtoffshore.com (WTI)