Drilling / Well Results | Forecast - Production | Drilling Activity

HighPoint Touts Latest Hereford Results; Q3 Output at High-End of Guidance

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   |    Monday,October 07,2019

HighPoint Resources Corp. reported positive results from the Hereford Field and announces third quarter of 2019 production at the high end of its guidance range.

Highlights include:

- Third quarter production sales volume expected to be 3.4 MMBOE, which is a 20% sequential increase over the second quarter of 2019 and at the high end of guidance despite depressed processing yields

• Third quarter oil volumes are expected to be 2.18 MMBbls or 64% of total equivalent production sales volume, which is a 25% sequential increase over the second quarter of 2019

- Strong operating results from Hereford with wells in DSU 11-63-16 exhibiting a 75% current daily production increase over previously completed wells

• Early results in DSU 11-63-17 demonstrating 30% higher initial total fluid productivity compared to DSU 11-63-16

Chief Executive Officer and President Scot Woodall commented, "Following up on our solid second quarter results, we continued to demonstrate strong operational execution during the third quarter as we anticipate production to be at the high end of our guidance range, including high oil volumes. This outperformance was driven primarily by well performance and completion improvements in Hereford and NE Wattenberg that exceeded expectations and was achieved despite depressed processing yields, including basin-wide ethane rejection. We are extremely pleased with significantly improved results in Hereford and our optimization program, which is yielding a substantial and continuous improvement in well productivity and confirms a highly economic value creation opportunity. This is demonstrated by early production data as the initial seven wells located on the eastern portion of DSU 11-63-16 are exhibiting a dramatic current daily production increase of 75% greater than previously completed wells. In addition, the wells in DSU 11-63-17 were completed with even larger fluid volumes and are demonstrating 30% higher total fluid productivity during early flowback, which is an early positive indicator of greater stimulated reservoir volume. Production from these wells continues to ramp and an assessment with respect to EURs and optimal well spacing will be provided once the wells reach peak production. We also continue to see positive results in NE Wattenberg as the seven wells on the western flank of the acreage continue to track above a 1 MMBoe type-curve. More recently, we placed seven XRL wells on flowback in DSU 5-61-35 in the central portion of the field in September that are ramping to peak production. Furthermore, we remain positioned to generate positive free cash flow for the remainder of the year and look forward to providing further updates as we deliver increased value to our stakeholders."

Hereford Field

The Company recently completed the implementation of its extensive reservoir and geologic technical study of the Hereford Field and is pleased with the initial results and the immediate performance insights gained during the execution of the program. This is demonstrated by strong early production results that are dramatically improved compared to earlier wells. Specific conclusions reached and implemented include design changes in fluid volumes and pump rates as well as cluster and stage spacing that materially increase the stimulated rock volume and greatly enhance the Company's ability to deliver an economic and repeatable development program.

Recent results are highlighted by seven wells located on the eastern portion of DSU 11-63-16 that were placed on flowback in June and have the longest production history. Development consisted of increased well density of 16 wells per section, incorporated approximately 30 barrels of fluid per lateral foot and approximately 1,500 pounds of sand per lateral foot. The completion improvements implemented have resulted in better early productivity than previously drilled wells and is driving a current daily production rate increase of approximately 75% compared to early program wells. In addition, through the initial 105 days of production, the wells have achieved average cumulative production of approximately 33,000 barrels of oil per well, which is 22% higher than previously completed wells. The Company is also encouraged by the early production profile of the remaining wells in the program, which include four wells located on the western portion of DSU 11-63-16 and 12 wells located in DSU 11-63-17. These wells were stimulated with larger fluid completions than all previous wells and continue to ramp to peak production after being placed on flowback in July. The wells are demonstrating 30% higher initial total fluid productivity compared to DSU 11-63-16 during initial flowback. This positive increase coupled with higher observed pressure should be a direct indicator of increased stimulated reservoir volume supporting higher hydrocarbon production.

NE Wattenberg

The Company is seeing continued strong well performance as a result of high-fluid intensity completions as the seven XRL wells in DSU 4-63-5 on the western flank of its acreage continue to track above a 1 MMBoe type-curve. These are the first wells completed by the Company in this area utilizing high-fluid intensity completions.

The Company also recently placed seven XRL wells on flowback in DSU 5-61-35 in the central portion of its acreage in September that are in the early flowback stage.