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Eagle Ford / GOM Operators Talk Effects of Harvey on Operations

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   |    Wednesday,September 06,2017

Multiple companies have released updates on operations in the wake of Hurricane Harvey along the Gulf Coast.

Updates by date / company follow.

September 6, 2017

Updates as of Sept. 6. 2017.

Devon Energy

Devon Energy Corp. (NYSE:DVN) today provided a preliminary update on the impact of Hurricane Harvey to the company's Eagle Ford operations in south Texas.

As a precautionary measure in preparation for Hurricane Harvey, the company temporarily ceased drilling, well-completion activity and shut-in production across its entire Eagle Ford position. Post-storm inspections indicated that Devon's producing assets and facilities sustained only minimal damage. The company has restarted drilling operations and expects to have the vast majority of its affected production online by the end of the week.

Devon is working with its downstream providers to minimize midstream and fractionation curtailments in the Gulf Coast region. Many third-party downstream facilities have now restarted, and the company plans to update its production outlook once more information is available.

ExxonMobil

ExxonMobil said today that facility assessments and restart activities continue at its Baytown refinery, and that it has made significant progress in restarting chemical production, pipelines and other logistical infrastructure in the Houston area. The company's fuel terminals in Houston are open and supplying gasoline and diesel to customers. Offshore production platforms in the Gulf of Mexico are beginning to return to normal operations. Production units at the Beaumont refinery remain shut down due to flooding in the lower level of the refinery.

Safety remains the company's first priority as facility assessments continue and operations begin to resume.

Efforts are underway to transport refined products from unaffected regions to communities and customers in the most severely impacted areas. The company is also delaying scheduled maintenance at other ExxonMobil refineries to continue producing gasoline and diesel to relieve the supply situation. Personnel from the Baton Rouge, Billings and Joliet refineries are being deployed to Baytown and Beaumont to help restore operations.

The company has allocated supplies of fuel for use by emergency responders, and has thus far provided nearly 650,000 gallons to responders working in areas impacted by the storm, including Beaumont, Baytown and the greater Houston area, as well as Dallas and Baton Rouge. In Beaumont, ExxonMobil engineers continue to assist the city with restoring the municipal water system, which was impacted by flooding. The company has distributed 30,000 bottles of water and about 400 pounds of toiletries in Beaumont. About 4,500 gallons of bleach have also been provided to Jefferson County for distribution to residents and businesses in impacted areas.

"Our teams have been working around the clock to restore operations as quickly and safely as possible so we can supply fuels to our customers," said Darren W. Woods, chairman and chief executive officer. "The incredible efforts our employees have put behind maintaining critical operations under challenging conditions has been remarkable."

ExxonMobil has also been assessing impacts on its onshore and offshore oil and gas production assets. Galveston 209 offshore platform systems are safe and operational, and startup operations are underway. The Hadrian South subsea production system in the Gulf of Mexico has been deemed safe and operational, and production has resumed. Crews from ExxonMobil subsidiary, XTO Energy, have begun assessments and are bringing onshore wells on line when safe to do so.

ExxonMobil employees are also contributing their time toward assisting area residents in need. For example, the company's U.S. Production unit is initiating a volunteer program to continue assisting fellow employees, ExxonMobil annuitants, and the greater community. Employees have also volunteered at several area shelters, including the George R. Brown Convention Center in Houston, the Fort Worth Convention Center, and others in the region.

Employees can take advantage of the ExxonMobil Foundation's volunteer involvement program. In the United States, the program provides qualified organizations a $500 donation on the employee's behalf for every 20 hours volunteered, up to four times per volunteer per year.

"Volunteerism has been a core value for the company since its earliest days," Woods said. "Our employees are committed to assisting residents in their communities also impacted by effects of the storm. Our thoughts remain with all area residents during this challenging time, and we hope our efforts in working with disaster relief agencies and local first responders have provided comfort to families and individuals in need."

ExxonMobil has also established an employee and retiree donation match program to support relief and recovery. Employee and retiree contributions to the American Red Cross and Salvation Army will be matched on a one-to-one basis up to $25,000 per donor and up to $3 million in total, which will generate up to $6 million for the disaster relief organizations. The company has donated $2.3 million in advertising time to the Red Cross that has been dedicated to high-profile televised public service announcements. These commitments, along with $1 million in initial contributions to the American Red Cross and United Way of Greater Houston and about $1 million worth of in-kind contributions in South Texas, total about $10.3 million.

Employee safety and well-being remains a top priority, and those who need to work remotely are being encouraged to do so. Health and counseling services are available on request for employees. Hotlines have been established to provide updated information to employees across different geographical locations. Constant contacts between managers and employees, as well as the company's automated employee tracking system, have been instrumental in ensuring employee safety.

W&T Offshore

W&T Offshore, Inc. (NYSE: WTI) today announced that W&T experienced relatively minor impacts from Hurricane Harvey in the Gulf of Mexico. In total, the Company's deferred production was approximately 43,000 barrels of oil equivalent and it experienced no material platform damage resulting from the storm. In relative terms, this production deferment is immaterial and represents approximately one day's equivalent production for the Company.

Tracy W. Krohn, W&T Offshore's Chairman and Chief Executive Officer, commented, "Our operations teams were well prepared for the storm and did a great job avoiding and mitigating issues and re-manning our facilities in a safe and efficient manner. We are pleased to report that we sustained essentially no damage to our offshore assets from the storm and have experienced only a minor amount of deferred production volume."

In preparation for the storm, W&T temporarily shut-in and evacuated a small number of its western Gulf of Mexico (GOM) offshore platforms that were located closer to the Hurricane's projected path. The vast majority of the Company's other offshore production platforms and its offshore drilling operations were all on high alert, but conducted near-normal operations during the storm event and were relatively impact free with minimal downtime. The Company has since re-manned and re-started production from its operated offshore production facilities. One non-operated field located in the western GOM is being prepared for production resumption and is anticipated to come back on line soon. The company experienced no injuries or environmental events and experienced no material platform damage as a result of the storm. The company is currently producing at normal pre-storm production rates.

Denbury Resources

Denbury Resources Inc. (NYSE:DNR) ("Denbury" or the "Company") today announced that over the last several days, production has been restarted at five of its six fields impacted by Tropical Storm Harvey. As of today, the Company estimates that approximately 90% of the 16,000 barrels of oil equivalent ("BOE") per day of net production shut-in as of August 27 has been returned to production, and the Company has not identified any significant damage at these impacted fields. The only field that remains shut-in is Thompson Field, which had net production just prior to the storm of approximately 1,000 BOE per day. Production at Thompson Field is expected to return to full capacity over the next eight weeks, as flooding in that area subsides and personnel are able to access the field.

The primary impacts of the storm to date include minimal cleanup costs and temporarily shut-in production. The Company does not expect any insurance recovery related to the storm. The impact of Tropical Storm Harvey on third quarter's production is estimated to be 2,000 2,200 BOE per day, and full-year production is still expected to be within our previously updated guidance of 60,000 62,000 BOE per day.

Christian S. Kendall, Denbury's President and CEO commented, "Our thoughts and prayers are with all affected by this significant storm, including several Denbury families. Although the impact of the storm will be ongoing in the Houston area for quite some time, its effect on our operations was significantly limited due to our pre-storm preparations and the resilience of Denbury's workforce. Above all, I am pleased that all our workers and their families remained safe throughout."

Energy XXI Gulf Coast

Energy XXI Gulf Coast, Inc. ("EGC" or the "Company") (NASDAQ:EXXI) today provided an additional update on the impact from Hurricane Harvey.

Once weather conditions in the Gulf of Mexico (GOM) improved, the Company was able to conduct flyover visual inspections of its facilities, and no significant damage was apparent. Crews began returning to EGC's facilities in the western GOM over the weekend for onsite assessment of their condition, and full crews are being restored to its central GOM facilities.

Production was initially shut-in in advance of the storm beginning on August 25. Following its initial release on the impact of the storm on August 28, several EGC-operated facilities beyond the western region were shut-in during the storm when crews were not able to address issues that arose in those locations. In addition, EGC has subsequently been informed by the operators of third-party operated fields that shut-ins occurred in those fields as well. As a result of these additional shut-ins, shut-in volumes peaked briefly at about 7,000 net barrels of oil equivalent per day, but production has already begun to be restored. Currently approximately 4,500 barrels of oil equivalent net daily production is curtailed due to the storm, or about 13% of second quarter 2017 total net average daily production.

Production is expected to be restored to Company-operated facilities that were shut-in from Hurricane Harvey over the next two weeks once EGC's management determines these facilities are safe and fully operational and that the pipelines, shore-based facilities and refineries who accept our product have become fully operational. EGC is awaiting additional information regarding restoration of production from third-party operated fields. The Company is closely monitoring the projected path of Hurricane Irma which may require evacuation of offshore facilities if it threatens the Gulf of Mexico.

Douglas E. Brooks, EGC's Chief Executive Officer and President, commented, "We are pleased that our operated facilities appear to have survived Hurricane Harvey with minimal impact to our offshore facilities. We will soon be in communication with operators of our non-operated assets. I am proud of our team as they work safely and diligently to restore our production as quickly as possible. This continues to be especially difficult as many of our teams address personal challenges much like many residents of Houston and along the Gulf Coast have faced due to extreme flooding conditions. Fully restoring production to pre-storm levels will take time as this is dependent upon all phases of the production, transmission and refining process becoming fully operational."

Williams Partners

Williams Partners (NYSE: WPZ) today announced that its facilities that serve gas and oil producers in the Gulf Coast area experienced no major damage as a result of Hurricane Harvey.

The majority of the partnership’s facilities required to handle offshore production have been inspected and are ready for service. However, as of Sept. 6, some production remains shut-in pending a pre-start test and the restart of the third-party operated Quintana Crude Oil Terminal.

Williams Partners said it is starting to see some offshore production come back online. For the Transco system, there is now about 200 MMcf/d of offshore gas supply being shut in by Gulf producers feeding the Transco system. Transco anticipates offshore production to resume over the next few days and will confirm nominations from previously impacted locations.

Transco has not experienced any operational issues; assessments remain ongoing, but no significant facility damage has been identified during the partnership’s inspections.

Williams Partners’ gathering systems in the Gulf Coast area are also ready for service following post-hurricane inspections and expect third-party producers to resume flow into these systems in the next 24-48 hours. Discovery’s Keathley Canyon Connector resumed normal operations on Aug. 28.

Williams continues to focus on the needs of its employees who were impacted by the storm in the hurricane-affected areas. Employees affected by Harvey are being supported through the Williams emergency disaster relief fund, which includes direct assistance for Williams employees with immediate financial needs.

Last week Williams also announced that it is contributing $500,000 to the United Way of Greater Houston’s flood relief fund.

The company continues to monitor needs in the area and, consistent with its core values and beliefs, will determine other ways to assist throughout the Gulf Coast region.

September 5, 2017

Updates as of Sept. 5, 2017

Carrizo

Carrizo Oil & Gas, Inc. (Nasdaq:CRZO) today provided an update on its operations following Hurricane Harvey as well as announced an agreement to sell its assets in the Utica Shale.

Operational Update Following Hurricane Harvey

Carrizo's producing assets and facilities in the Eagle Ford Shale sustained no damage as a result of Hurricane Harvey. In preparation for the storm, the Company suspended its drilling and completions operations in the play, but crews were able to return to the field last week, and all of the Company's operated Eagle Ford rigs and frac crews have resumed operations. As a result of downtime at third party midstream facilities and Gulf Coast refineries, sales volumes were temporarily reduced. The Company was able to secure some storage capacity, which has partially mitigated the impact on its production. Many of the third party facilities have restarted and resumed taking crude oil and natural gas, and Carrizo expects to be able to ramp back to nearly full sales capacity in the play this week. The Company plans to update its production guidance once more detailed information is available.

Crestwood

Crestwood Equity Partners LP (NYSE: CEQP) (“Crestwood”) announced today that all Crestwood employees have been contacted and are safe, the Houston office and corporate headquarters has resumed normal business activity, and the Tres Palacios Gas Storage facility, located along the gulf coast in Matagorda County, TX, has resumed normal operations with no long-term impact following Hurricane Harvey. Crestwood conducted thorough safety and asset integrity tests before returning the facility to service on August 31st and does not anticipate the temporary shut-in to have a meaningful impact on Crestwood’s operations.

“We are thankful all Crestwood employees are safe, no assets were materially impacted and we are committed to helping our employees and the community rebuild following this devastating natural disaster,” said Robert G. Phillips, Chairman, President and CEO of Crestwood Equity Partners. “In addition to the previously announced donation of $125,000 to the Red Cross of Greater Houston and employee match program, Crestwood has initiated an employee assistance program for members of the Crestwood family who were directly affected by the storm. We are very grateful for the national outpouring of support we have received and I am proud of our employees involvement in local relief and recovery efforts. The impact of this storm will be felt in this community for a long-time to come, and we are committed to fully supporting the recovery of Houston and its surrounding communities.”

September 1, 2017

Updates as of Sept. 1, 2017

Energy Transfer Partners

Energy Transfer Partners (NYSE: ETP) announced today that based on an initial assessment, it has determined that the overall impact to its operations in the Houston area and along the Gulf Coast from Hurricane Harvey has been minimal, and that all of its employees are safe and accounted for.

Energy Transfer has dedicated approximately one thousand employees to its emergency response team to manage the operational challenges presented by Hurricane Harvey. This dedicated team, many of whom are facing personal losses and hardships because of the hurricane, has gone beyond the call of duty to expertly manage Energy Transfer’s operations during this catastrophic event.

Below is an assessment of Energy Transfer’s current operations by operating segment:

Crude Segment

Energy Transfer’s crude operations continue with minimal interruptions; however, takeaway capacity is constrained based on ship channel closure and refinery capabilities. The Nederland, Texas facility continues to leverage its storage capacity; however, deliveries are being managed to maximize the system. Bayou Bridge and Dakota Access pipelines are fully operational and delivering product. Energy Transfer’s terminal and trucking operations are coming back up to full operations as flood waters recede.

Natural Gas/Natural Gas Liquids

Energy Transfer’s extensive natural gas pipeline system throughout Texas is operational and undamaged. Systems are now operating near full capacity with volumes returning out of the Eagle Ford Shale. Energy Transfer did experience some interruption in its natural gas liquids service earlier in the week due to limited takeaway capacity and constraints at Mont Belvieu.

Refined Products

Energy Transfer’s Mont Belvieu, Texas facility is fully functional including its ability to export products; however, only two of the four fractionators are operating due to constrained takeaway capacity and the shut in of all ship and barge operations at this time. All other refined products marketing terminals in Texas and Louisiana are open with the exception of the Hebert Terminal; however, inventories are low. The Hebert Pump Station is expected to restart by Sunday, September 3, 2017.

August 31, 2017

Updates as of August 31, 2017.

EP Energy

EP Energy Corporation (NYSE:EPE) today announced the company's Eagle Ford assets have not experienced any damage from weather relating to Hurricane Harvey. The local area only experienced a few inches of rain, which did not impair drilling or production operations.

"Our teams have performed well and operations have been conducted safely during the last week. We remain focused on the safety of all of our employees and the communities in which we operate," said Brent Smolik, chairman, president and chief executive officer of EP Energy Corporation. "Production volume impacts were minimal during the storm. Looking ahead, we will continue to monitor the recovery of the Gulf Coast downstream infrastructure for potential impacts on market demand."

Halcon Resources

Halcón Resources Corporation issued a statement today regarding Hurricane Harvey.

The Halcón family's thoughts and prayers are with those that have been and continue to be affected by Hurricane Harvey and the devastating flooding in Houston and surrounding communities. The Company is thankful all of its employees are safe. Halcón's operations were unaffected during the hurricane and continue without interruption thanks to the efforts of its dedicated employees, vendors and contractors.

Halcón is proud of its employees who are actively volunteering in their neighborhoods and communities. It will take all businesses, government agencies and volunteers working together to rebuild our community.

The Company has instituted a program whereby all employee donations up to $3,000 for relief donations will be matched by the Company. Halcón is also assisting its own employees who have been directly impacted by Hurricane Harvey.

Additionally, Halcón Resources is making a $250,000 donation to the JJ Watt Houston Flood Relief Fund to assist in the relief and recovery efforts throughout Houston and surrounding areas.

August 30, 2017

Updates as of August 30, 2017.

Penn Virginia

Penn Virginia Corporation provided an update on the impact to its Eagle Ford Shale operations in south Texas from Hurricane Harvey.

There has been no long-term damage to Penn Virginia's producing assets or facilities due to the storm. The Company's Gonzales, Texas, field office is fully operational.

  • Sales of production have been curtailed due to compression availability and localized flooding. The Company is currently producing at approximately 50% of full potential with 80% of production expected to be online in three days and full production expected in a week, depending on refinery capacities.
  • Drilling operations were suspended at the four-well Rhino pad and the three-well Oryx pad in advance of the storm. Drilling operations have resumed on the Rhino pad and the Company expects drilling operations to resume on the Oryx pad by tomorrow.
  • Completions operations were suspended at the eight-well Chicken Hawk and Jake Berger pads. The Company expects completion operations to resume within two days. The completion of the Chicken Hawk and Jake Berger pads is expected to be delayed by seven to ten days compared to original estimates with first sales now anticipated to be in late September.
  • The storm impacts are not expected to delay the closing of the previously announced acquisition of Eagle Ford assets from Devon Energy Corporation primarily located in Lavaca County, Texas, with closing still anticipated for September 30 or earlier.
  • The Company will update production forecasts as more detailed information becomes available.

John A. Brooks, President and Chief Executive Officer, commented, "While the full impact of this historic storm is still not fully known, I am pleased to report that our employees and their families are safe. We appreciate the substantial efforts of our employees and contractors during this trying time as they have made outstanding progress in our drive to resume full operations as quickly and safely as possible. Most important, our thoughts are with the many thousands of fellow Texans that are dealing with very difficult circumstances."

Sanchez Midstream

Sanchez Midstream Partners LP announced that the Company’s midstream assets in the Western Eagle Ford did not sustain any significant damage from Hurricane Harvey.

“We are pleased to report that our midstream assets in South Texas, which include our Western Catarina Midstream system, the Carnero Gathering Line, the Raptor Gas Processing Facility in La Salle County, Texas and Seco Pipeline, did not sustain any significant damage as a result of Hurricane Harvey and are currently fully operational,” said Gerry Willinger, Chief Executive Officer of the General Partner of SNMP. “We are in contact with employees based in our Houston office and in the field and remain primarily concerned for the safety of these individuals, as well as other members of our community. We would like to thank the first responders that have worked diligently throughout the crisis along the Gulf Coast as well as the people who have unselfishly volunteered to assist others during this time of need. We would also like to thank our operations team and joint venture partner, Targa Resources Corporation, for their exceptional work in preparing for Hurricane Harvey and managing our assets throughout the storm.

“While all of our midstream assets are currently fully operational, we remain cognizant of the potential for natural gas liquids constraints at Mont Belvieu and markets further downstream, which may limit our ability to move hydrocarbons. In the wake of Hurricane Harvey, we continue to monitor developments in these downstream markets, as well as the operations and production from the assets that we service, and will provide additional operational updates as warranted.”

August 29, 2017

Updates as of August 29, 2017.

WildHorse Resource Development

WildHorse Resource Development announced today that its Eagle Ford operations and production have been minimally affected by Hurricane Harvey. WRD's assets sustained no damage and only a small portion of its Eagle Ford production was temporarily shut-in during the storm. WRD is currently operating all five of its rigs and experienced insignificant drilling down time. Completions were temporarily suspended due to weather conditions, but are again operational with two of three crews back online. Full completion operations are expected within the next twenty-four hours with the resumption of the third crew. While the availability of third-party oil-hauling trucks has been limited by the storm, considerable capacity has returned to our region with most capacity expected to return over the next few days. These temporary trucking constraints affected oil sales but not production volumes.

"We are very proud of our field personnel and their ability to prepare for this storm. They have managed to keep us operational with minimal down time while also maintaining an unwavering commitment to the safety and welfare of our employees," said Jay Graham, Chairman and Chief Executive Officer of WRD, "As the Texas Gulf Coast recovers from this disaster, the community will be foremost in our thoughts and prayers. We would also like to thank our first responders for their amazing work as well as the contributions of countless citizens volunteering at this time. Together as a community, we plan on coming back stronger than ever from this storm."

Silverbow Resources

SilverBow Resources, Inc. announced an update to operations after Hurricane Harvey.

The Company's continued thoughts and prayers go out to all those affected by the tragic and catastrophic weather associated with Hurricane Harvey. The safety of our employees and contractors is our top priority, and as such we have temporarily closed our Houston headquarters.

Our field operations are not in flooded areas and have been largely unaffected by the storm. We have continued drilling and completing our wells on schedule with only minor delays due to equipment and crew availability. However, we have had to shut-in some of our wells due to the temporary curtailments of third-party midstream providers. Generally, we expect these outages to be short in duration. While it is too early to quantify the overall impact the weather will have on our operations, we will continue to monitor conditions and update the markets when appropriate.

Baytex Energy

Baytex Energy Corp. announces that due to Hurricane Harvey, on August 25, 2017 our Eagle Ford operations were shut-in and drilling and completion operations were suspended. This decision was driven by a number of factors including the safety of operating personnel and the availability of downstream markets. Our Houston office was also evacuated.

As of August 28, 2017, field operations are being inspected and drilling and completion operations are expected to resume this week.

There is currently a limited ability to produce as downstream markets are closed or significantly curtailed. The safe start-up of field operations has begun and will be balanced with market access. We expect to increase production throughout the week.

August 28, 2017

Updates as of August 28, 2017.

Sanchez Energy

Sanchez Energy announced that the Company's Western Eagle Ford operations and production have been largely unaffected by Hurricane Harvey to date.

"While Hurricane Harvey has had a significant impact along the Gulf Coast, we can currently report that our operations and production in the Western Eagle Ford in South Texas have been largely unaffected by the storm," said Tony Sanchez, III, Chief Executive Officer of Sanchez Energy. "We are very happy to report that currently none of our assets have sustained significant damage.

"As always, our primary concern is the safety of our employees and other members of our community and the environment. Our drilling operations are ongoing and were only temporarily impacted by the storm. As a precautionary measure, we have suspended completion operations but we expect those to resume as soon it is safe to do so. We will continue to monitor the situation and take additional steps as needed. We applaud the professionalism that our operations team has shown through this crisis and would like to thank all of the first responders that have helped people across the impacted areas of Texas."

Energy XXI

Energy XXI Gulf Coast, Inc. provided an update on the impact from Hurricane Harvey.

Late last week the Company initiated its emergency preparedness plan and evacuated all personnel from its western Gulf of Mexico (GOM) facilities and production from those fields was temporarily shut-in. Those facilities will remain shut-in until the weather in the GOM clears sufficiently to allow visual inspections to determine if any significant damage has occurred. About 4,000 barrels of oil equivalent net daily production (or approximately 11% of second quarter 2017 total net average daily production) is currently curtailed due to the storm. Non-essential personnel were evacuated late last week from EGC's central GOM properties where the majority of its production is located, but production was not shut-in. Staffing in that area is expected to return to normal levels once the weather clears. Operations in the Company's eastern GOM region were not impacted.

Douglas E. Brooks, EGC's Chief Executive Officer and President, commented, "We are thankful that all of our personnel, both offshore and in the Houston area, are safe but many are facing risk from additional flooding of their homes due to the continuing impact by the remnants of Harvey. I personally thank them all for their efforts to keep our offshore business operating when they faced huge personal challenges. We will conduct inspections of our offshore facilities as soon as possible and will return them to production upon confirmation that there is no major damage and that the pipelines serving the area are operational. We will provide additional updates over the next several days as warranted."

Denbury Resources

Denbury Resources Inc. announced that due to conditions associated with now Tropical Storm Harvey, effective Sunday, August 27, the Company suspended operations and temporarily shut-in all production at its Houston area fields, representing net production of approximately 16,000 barrels of oil equivalent per day. The impacted fields include Hastings, Oyster Bayou, Conroe, Thompson, Webster and Manvel. While no significant damage outside of localized flooding has been reported at any of these fields, the full impact of the storm may not be determined for several days as we have evacuated our employees and contractors as a precautionary measure.

Chris Kendall, Denbury's President and CEO commented, "The safety of our employees and contractors is our top priority. We will continue to monitor conditions at each of the impacted fields, and will resume operations to restore production when conditions allow, and we are able to ensure the safe return of our personnel."

Lonestar Resources

Lonestar Resources has provided an operations update following Hurricane Harvey.

As the storm approached, Lonestar received notice from its crude oil purchasers regarding suspended operations on August 24, 2017, and evacuated their field personnel from the Eagle Ford Shale producing region, and terminals which receive the bulk of Lonestar's crude oil via truck were shut-in. Additionally, refineries in Houston, Texas and Corpus Christi were shut down, and the Ports of Houston and Corpus Christi have been closed.

Lonestar elected to continue producing the vast majority of its Eagle Ford Shale wells, and has been largely successful in maintaining production wherever adequate crude oil tankage is available. Lonestar has experienced reduced gas sales at Horned Frog due to an outage at its amine plant, shut-in certain of its wells in Gonzales County due to lack of availability of trucking capacity, and certain of its producing wells at Marquis have been shut-in due to power outages. Generally, we expect these outages to be short in duration. However, the bulk of the Company's operated wells continue to produce, and in Dimmit and LaSalle Counties, trucking operations have already resumed and crude oil sales have recommenced this morning. Additionally, Lonestar ceased drilling operations at Burns Ranch, and delayed frac operations at Cyclone as a result of evacuations by its service providers. Lonestar currently anticipates resumption of drilling and completion operations later in the week.

Lonestar's Chief Executive Officer, Frank D. Bracken, III, commented, "Most importantly, our employees and their families are safe. Additionally, our operations team here in Fort Worth coordinated with our field personnel to come up with resourceful solutions to keep most of our wells producing through the storm and its aftermath. We are grateful to the tireless work of our operations group to maintain high levels of uptime while preserving safety in the work environment. Lastly, our hearts go out to our friends in the Houston area, who are bearing a heavy burden in the wake of this storm, and we wish them the best in their efforts to recover and rebuild."

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