Sanchez Energy Corporation, a fast growing independent oil and gas company with a 95,000 net acre position targeting the liquids-rich Eagle Ford Shale, Pearsall Shale, Austin Chalk, and Buda Limestone, today provided a drilling and production update on the Company's third quarter production and operating activities.
Sanchez Energy's estimated net production exit rate at September 30, 2012 was approximately 1,700 barrels of oil equivalent (BOE) per day, of which approximately 86% was oil. This rate represents a 42% increase over June 30, 2012 estimated net production exit rate of 1,200 BOE/d and an increase of over 350% from the same period a year ago. Production is expected to significantly increase during the fourth quarter as the Company executes the remainder of its 2012 drilling plan and adds seven wells already drilled and currently waiting on completion. Sanchez Energy reaffirms its 2012 production exit rate guidance range of 4,000 to 5,000 BOE/d.
Tony Sanchez, III, President and Chief Executive Officer, said, "We are executing our accelerated drilling program with two rigs currently drilling in each of our three major project areas after closing our $150 million convertible preferred equity offering. As we continue more development-type drilling in each project area and bring online wells currently waiting on completion, we expect to rapidly grow our production from its base of 1,700 BOE/d at the end of September. We are also testing tighter spacing in each of our areas, which may allow us to materially increase our 800 to 1,200 net identified potential drilling locations and our 250 to 380 million barrels of oil equivalent net resource potential based on 80 to 120 acre well spacing."
Operations and Well Status Update
There are two rigs running in the Palmetto area, two rigs running in the Marquis area, and two rigs running in the Maverick area.
Maverick Area — Zavala and Frio Counties:
Sanchez Energy has nine producing wells and two wells currently drilling in its Maverick area. The Company expects to spud a total of up to 10 gross and net wells in 2012.
- The Mark & Sandra #3H and the Petro-Pards #3H have both been recently spud and will be followed by the Petro-Pards #4H. These wells are offsets to the Mark & Sandra #2H, which had a 24-hour initial production rate of 931 BOE/d (~97% oil).