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Newfield Exploration Issues Mid-Year Operational Update

Stocks in this article: NFX

Newfield is a proven operator in the Woodford formation of Oklahoma where it has drilled approximately 380 horizontal wells in the Arkoma Woodford since 2005. In the second half of 2012 and into 2013, Newfield plans to drill SXL wells (up to 10,000' laterals) in the Cana Woodford, a practice that led to improved production rates, higher recoveries of hydrocarbons, lower finding and development costs and improved returns in the Arkoma Woodford.

Net production from Newfield's Mid-Continent region is approximately 57,000 BOEPD.

Uinta Basin Oil Developments

Newfield's production from the Uinta Basin continues to grow with current gross production recently setting a new record of approximately 36,000 BOEPD, or 25,000 BOEPD net. Full-year 2012 production is expected to increase about 20% over 2011 levels. Newfield owns interest in approximately 230,000 net acres in the Uinta Basin.

The region's production growth is being driven by strong results from the Central Basin region, an area located immediately north and adjacent to Monument Butte. The Central Basin is producing more than 7,500 BOEPD gross (85% oil) from new plays in the Uteland Butte and Wasatch.

Uteland Butte – Newfield is very encouraged with production rates from its first two horizontal wells completed in the "pressured" section of the Uteland Butte. Initial production rates from the two pressured wells were nearly three times the rate of the Company's initial wells in the normally-pressured Uteland Butte section.

Grace 3-16 The Grace is the most recent well to commence production with initial gross production of 1,476 BOEPD (87% oil), and averaged 1,276 BOEPD over its first 7 days of production.

Thorne 4-2 The Thorne had initial gross production of 1,435 BOEPD (87% oil), and averaged 929 BOEPD over its first 30 days of production.

The Company is currently completing two additional "pressured" Uteland Butte wells. Newfield has more than 200,000 net acres prospective for the Uteland Butte. In development mode, Newfield believes that these wells will be drilled and completed for about $5.5 million gross.

Wasatch – Since mid-2011, Newfield has drilled and completed more than 30 vertical wells in the pressured Wasatch play, a deeper geologic formation prevalent on approximately 60,000 net acres. Year-to-date 2012, Newfield has completed 18 vertical Wasatch wells with an average initial gross production rate of nearly 900 BOEPD and a 30-day average gross rate of more than 400 BOEPD. On average, the pressured vertical Wasatch wells can be drilled and completed for about $4.2 million gross.

The Company recently commenced production on its first two horizontal pressured Wasatch wells. Although encouraged with early flowback, the wells continue to clean-up and have not yet achieved peak initial production rates. Peak rates are expected in the next few weeks.

In the second half of 2012, the Company plans to drill an additional 15-20 pressured wells in the Central Basin, primarily targeting the Uteland Butte and Wasatch formations.

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