Houston-based Crimson Exploration Inc. said its Woodbine and Eagle Ford shale programs continue to enjoy success, contribution to second quarter production that was in the upper range of the company’s guidance.

Crimson has about 18,500 net acres in Madison and Grimes counties, TX, covering three areas that the company refers to as Force, Iola-Grimes, and Chalktown where it has been developing the Woodbine. The oil potential in all three areas has been confirmed by production tests.

“The Woodbine section in each of these areas has slightly different characteristics, including different sand lobes within the overall Woodbine section, and it is expected that more than one well will be required in each area to optimize the best landing point and completion practices required to maximize production and recovery,” the company said. “Crimson is very encouraged by the results to date and confident that this area will deliver a multi-year inventory of impactful and superior rate of return oil projects…”

Crimson estimates that there are 115 net potential drilling locations in its Woodbine acreage based on 160-acre spacing. Assuming the company’s average type curve estimated ultimate recovery (EUR) of 400,000 boe — 90% oil and natural gas liquids (NGL) — per location, total net potential in the Woodbine acreage is more than 34 million boe, which represents more than five times Crimson’s net liquids reserves booked at year-end 2011, the company said.

In the Eagle Ford Shale, recent wells drilled in adjacent Brazos, Robertson and Leon counties have had initial production (IP) rates in excess of 600 b/d, Crimson said. The Eagle Ford section across Crimson’s acreage position has similar reservoir characteristics, thickness, porosity, resistivity and shows in existing wells. Assuming development on 80-acre spacing, the Eagle Ford could potentially add up to an additional 230 locations and 68 million boe of net potential to Crimson’s position, the company said.

The Georgetown was recently tested by an offset operator adjacent to Crimson’s Force acreage at an IP of more than 700 b/d. The Georgetown is a 300-foot thick carbonate section that has historically produced from both vertical and horizontal open-hole completions. The use of horizontal multi-fracture completions potentially changes the Georgetown from a statistical play to a repeatable resource opportunity, Crimson said.. Assuming development on 320-acre spacing, the Georgetown could potentially add up to an additional 58 locations and 17 million boe of net potential for Crimson.

The evolution of the Buda Lime is very similar to that of the Georgetown, where recent wells employing horizontal multi-frack technology have resulted in IPs of more than 600 b/d, the company said. The technology potentially changes the Buda from a statistical play to a repeatable resource opportunity. Assuming development on 320-acre spacing, the Buda could potentially add up to an additional 58 locations and 17 million boe net potential to Crimson’s position.

“[We] believe that our results provide the data points necessary to validate our acreage position in Madison and Grimes counties where we have over 18,500 net acres that includes 115 drilling locations in the Woodbine, and potentially as many as 346 additional locations in the Eagle Ford, Georgetown and Buda formations,” said CEO Allan Keel.

“Given the scale of our leasehold position, we are confident that this area will generate significant value for the shareholders. Permitting and new well activity has increased dramatically in Madison and Grimes counties in recent months due to the liquids-rich characteristics of the multiple underlying formations and the ability to attain premium oil price realizations due to access to the Gulf Coast markets. We are very encouraged by the results to date and will continue to monitor new well activity to develop the best practices needed to maximize performance.”

Production during the second quarter was 3.7 Bcfe, or 40,432 Mcfe/d, within the upper range of the company’s production guidance of 38,000-41,000 Mcfe/d. Crude oil and natural gas liquids production averaged 46% for the second quarter, up 8% over the first quarter of 2012 and up 20% from the prior-year quarter. Over the last year Crimson has transitioned production from a gas-weighted profile to a current production profile of an approximate 50/50 balance between crude oil and natural gas liquids (NGL) and natural gas.