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Production On the Rise for Barrett Resources in the Piceance Basin

Production On the Rise for Barrett Resources in the Piceance Basin

The Colorado Oil and Gas Conservation Commission has approved Barrett Resources' proposal to drill one well per 20 acres within the company's 9,000 acre Rulison, Parachute, and Grand Valley fields located in the Piceance Basin of western Colorado. With this ruling, Denver-based Barrett expects to add 143 Bcf of proved gas reserves from the allotted 134 well sites by the end of 2000.

The approval sets the stage to extend the Piceance drilling inventory by over five years with a continuous four-rig drilling system. It follows a similar ruling in 1998 that opened 4,000 acres in the Piceance to the same well spacing. Barrett's proved gas reserves in the Piceance as of Dec. 31, 1999 were 461 Bcf.

"Barrett has achieved exceptional success in the Piceance Basin," said Joseph N. Jaggers, president of Barrett. "Production levels continue to exceed our original forecast for the year. Development on 20-acre well density will allow Barrett to improve reserve recovery and sustain low risk production growth."

The commission's ruling did impose certain requirements on the producer. The company must use directional drilling from 40-acre surface locations for 33 of the 134 wells, additional site reclamation and advance notice on drilling. Barrett expects these conditions to add up to $140,000 (15%) to the drilling and completion costs on each of the 33 wells.

The company's Piceance gas production has increased 17% since the beginning of 2000, setting a record level of 105 MMcf/d. Barrett attributes the rise to its continuous four rig drilling program, more efficient drilling techniques and increased compression on the gathering system. As a result, the company said it expects to surpass its forecast for the year by 21 wells, drilling a total of 88 wells in 2000.

"Our exploration team also continues to generate quality prospects in the Piceance Basin, such as the Grand Hogback prospect, which will be tested in 2001. The Piceance Basin is a cornerstone of the company's natural gas growth and demonstrates the effectiveness of the Company's Rocky Mountain strategy," said Jaggers.

Alex Steis

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