Also Provides Gulf Coast Lease Sale Results
HOUSTON, March 31 /PRNewswire-FirstCall/ -- Cabot Oil & Gas Corporation (NYSE: COG) today announced results from its first quarter exploration drilling activity including three additional discoveries from its Gulf Coast region and its initial discovery in Canada. In aggregate, the Company is off to a stellar start in 2004 with seven successful wildcats in as many attempts, five successes in the Gulf Coast region, one in Canada and one in the Rocky Mountains. The three previously disclosed discoveries include Eugene Island 142 #5, the Breton Sound 41 #5 and the Osborne Spring Unit #32-14.
The three new discoveries in the Gulf Coast region include:
Cabot's Little Horn Bayou Prospect was drilled on Continental Land & Fur acreage in Terrebone Parish, LA. The CL&F 8-1 well was drilled to a total depth of 14,422 feet and encountered 94 feet of pay in the Bourg formation. Completion efforts are underway with initial production expected in June of this year. The initial rate anticipated from this well is approximately 15 million cubic feet equivalent per day (Mmcfe). The discovery has also set up one additional offset location, which will spud in April. Cabot has a 75% working interest and operates both the discovery well and the planned offset.
Cabot owns a 25% working interest in the Eugene Island Block 277 #A-3 well, operated by EPL. Thus far, the well has encountered 15 feet of pay in the Basal Nebraskan 2 sand (BN-2) at approximately 8,700 feet and 20 feet of pay in the BN-7 sand at approximately 10,050 feet. Drilling continues toward a target depth of 12,600 feet with three additional primary objectives still to be evaluated.
In Acadia Parish, LA., the Cabot-operated Prevost #1 well was drilled to a total depth of 13,500 feet, encountering 10 feet of pay in the Nonion Struma. Production commenced the first week of March at 440 barrels of oil per day (BOPD) and 420 Mcf/D. The company has a 55% working interest in this well.
"Since the latter part of 2003, our exploration program has continued to gain momentum throughout the Company," said Dan O. Dinges, Chairman, President and Chief Executive Officer. "With this first quarter success, our Gulf Coast region is positioned to add meaningful production and reserves over the next three quarters."
Cabot's initial discovery in Canada came through its joint venture partner 6149332 Canada Inc. and was originally initiated in 2003. The Cabot Musreau 6-15-62-6W6 well was drilled to a total depth of 3,350 meters (10,991 feet). This well encountered 71 feet of pay in multiple zones. Completion efforts are underway with initial production anticipated by August 2004. Cabot owns a 40% working interest in the well.
"We are extremely pleased with Cabot's ability to get off to a successful start with our first wildcat in Canada," stated Dinges. "Canada is a long term play for the Company and our resolve remains committed to a drilling effort to grow this business."
In its ongoing effort to build its prospect inventory, Cabot Oil & Gas Corporation participated in the recent Central Gulf of Mexico Outer Continental Shelf Sale 190. The Company was the apparent successful bidder on eight of the ten blocks on which it bid, with apparent high bids totaling $3.0 million. These blocks continued the Company's focus on moderate depth exploration targets on the shelf. Following Phase I reviews by the MMS, the Company has already been awarded three of the blocks. Assuming the successful awarding of the other five blocks, Cabot will then hold an interest in 32 federal blocks in the Gulf of Mexico.
"This offshore effort complements our exploration efforts throughout the Company," commented Dinges. "Our Gulf Coast drilling provides us with significant reserve potential both onshore and offshore and our goal remains to balance this effort."
Cabot Oil & Gas Corporation, headquartered in Houston, Texas, is a leading independent natural gas producer with substantial interests in the Gulf Coast, including Texas and Louisiana; the West, with the Rocky Mountains and Mid- Continent; the East and an expansion effort in Canada. For additional information, visit the Company's Internet homepage at www.cabotog.com .
The statements regarding future financial performance and results and the other statements which are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties, including, but not limited to, market factors, the market price (including regional basis differentials) of natural gas and oil, results of future drilling and marketing activity, future production and costs, and other factors detailed in the Company's Securities and Exchange Commission filings.
SOURCE Cabot Oil & Gas Corporation