Lower Smackover Brown Dense Play

Southwestern Energy - Lower Smackover Brown Dense Comments - Fourth Quarter of 2011

Southwestern Energy (SWN) made the following comments about the Lower Smackover Brown Dense formation during the company’s conference call held on February 28, 2012, to discuss fourth quarter of 2011 earnings. The speaker is Steven L. Mueller, the CEO and president of Southwestern Energy.

“In our Lower Smackover Brown Dense play in southern Arkansas and northern Louisiana, we hold approximately 520,000 net acres at an average cost of $375 per acre. Earlier this month, we’ve began flowing back our first well in the area, the Roberson 18-19 #1-15H, located in Columbia County, Arkansas. This well had a vertical depth of approximately 9,369 feet and horizontal lateral length of approximately 3,600 feet and was completed in 11 stages. The lateral was landed in the lower 1/3 of the zone, and subsequent core analysis indicated this section had some of the lowest permeability in the entire interval. The well has been producing from 8 of the 11 stages, fracture stimulated. It has produced for 20 days of the originally planned 20- to 30-day cleanup period. Well production began on day 8, with the highest 24-hour rates to date of 103 barrels of oil per day, 200 Mcf per day of gas and 1,009 barrels of load water per day. 45% of load has been recovered to date.”

“Our second well, the Garrett 7-23-5H #1, located in Claiborne Parish, Louisiana, was drilled to a total depth in February 2012 of approximately 10,863 feet, with a 6,536-foot horizontal lateral. And fracture stimulations are planned to begin on March 1. Knowledge gains from the first well allowed us to drill the second well with no troubles and allowed us to target the Brown Dense drilling in the lateral and -- at no problems, allowed us to target the Brown Dense. Drilling in the lateral was not only faster, but oil shows in cuttings indicated better-quality rock.”

“We have also spud our third well, located in Union Parish, Louisiana, and is drilling at 7,900 feet. We're looking forward to learning more about this play, and our activity could increase dramatically if it is successful.”

Source: Seeking Alpha

Southwestern Energy - Lower Smackover Brown Dense Play Summary

Southwestern Energy (SWN) has 540,000 net acres under lease that is prospective for the Lower Smackover Brown Dense formation.  The acreage is located across parts of southern Arkansas and northern Louisiana.

Southwestern Energy said that the company’s average lease cost here was approximately $354 per acre and it holds an average net revenue interest of 82%.  The leases have four year terms along with four year renewals.

Southwestern Energy is targeting an upper Jurassic age oil formation at depths of 8,000 feet and a thickness of 300 to 550 feet.  The company has finished one well into the Lower Smackover Brown Dense formation and has at least two other wells in various stages of drilling or completion.  The three wells are:

Roberson 18-19 1-15H - Columbia County, Arkansas

Garrett 7-23-5H 1 - Claiborne Parish, Louisiana

BML 31-22 1-1H - Union Parish, Louisiana