"This joint venture provides Energy XXI the opportunity to drill best-in-class exploration projects with a world-class partner," Energy XXI Chairman and CEO John Schiller said. "Acquiring existing production in an oil producing reservoir, along with the additional opportunities identified by our teams, makes this agreement even more significant."
Production for the fiscal first quarter was impacted by downtime associated with Hurricane Isaac, as well as pipeline repairs. While the company sustained no significant physical storm damage, production was shut-in for an extended period. Combined with repairs to operated and third-party pipelines, these shut-ins are expected to result in production of approximately 37,000 BOE/d for the current quarter, with more than 70 percent being liquids. Current production is averaging 45,000 BOE/d, 71 percent oil, with current capacity of 50,000 BOE/d.
"Even with the storm and pipeline outages during the fiscal first quarter, and the deferral of two high-rate gas wells to accommodate the joint venture oil exploration, we still expect to grow the average annual production rate this year more than 25 percent while generating significant free cash flow," Schiller said. "Notably, the oil portion of our production could grow by more than 30 percent, with the potential for upward production and reserves additions in the future if we are successful with our high-impact exploration."Forward-Looking Statements All statements included in this release relating to future plans, projects, events or conditions and all other statements other than statements of historical fact included in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based upon current expectations and are subject to a number of risks, uncertainties and assumptions, including changes in long-term oil and gas prices or other market conditions affecting the oil and gas industry, reservoir performance, the outcome of commercial negotiations and changes in technical or operating conditions, among others, that could cause actual results, including project plans and related expenditures and resource recoveries, to differ materially from those described in the forward-looking statements. Energy XXI assumes no obligation and expressly disclaims any duty to update the information contained herein except as required by law. About the Company Energy XXI is an independent oil and natural gas exploration and production company whose growth strategy emphasizes acquisitions, enhanced by its value-added organic drilling program. The company's properties are located in the U.S. Gulf of Mexico waters and the Gulf Coast onshore. Seymour Pierce is Energy XXI's listing broker in the United Kingdom. To learn more, visit the Energy XXI website at www.EnergyXXI.com . The Energy XXI logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3587 GLOSSARY Barrel – unit of measure for oil and petroleum products, equivalent to 42 U.S. gallons. BOE – barrels of oil equivalent, used to equate natural gas volumes to liquid barrels at a general conversion rate of 6,000 cubic feet of gas per barrel. BOE/d – barrels of oil equivalent per day. MMcf/d – million cubic feet of gas per day. Net Pay – cumulative hydrocarbon-bearing formations. NRI, Net Revenue Interest – the percentage of production revenue allocated to the working interest after first deducting proceeds allocated to royalty and overriding interest. WI, Working Interest – the interest held in lands by virtue of a lease, operating agreement, fee title or otherwise, under which the owner of the interest is vested with the right to explore for, develop, produce and own oil, gas or other minerals and bears the proportional cost of such operations. Workover / Recompletion – operations on a producing well to restore or increase production. A workover or recompletion may be performed to stimulate the well, remove sand or wax from the wellbore, to mechanically repair the well, or for other reasons.
CONTACT: Energy XXI Stewart Lawrence Vice President, Investor Relations and Communications 713-351-3006 email@example.com Greg Smith Director, Investor Relations 713-351-3149 firstname.lastname@example.org Seymour Pierce Nominated Adviser: Jonathan Wright Corporate Broking: Richard Redmayne Tel: +44 (0) 20 7107 8000 Pelham Bell Pottinger James Henderson email@example.com Mark Antelme firstname.lastname@example.org +44 (0) 20 7861 3232