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Arena Resources, Inc. Announces 2005
Year End Production and Reserves
Tulsa, Oklahoma — February 22, 2006
— Arena Resources, Inc. (AMEX: ARD, ARD.WS) ("Arena")
("Company") announced today that its estimated total
proved reserves of oil and natural gas as of December
31, 2005 increased 42% to 30.2 million barrels of oil
equivalent (Boe), from 21.2 million Boe at year end
2004. The 2005 year-end proved reserves consisted of
24.9 million barrels of crude oil (82%) and 32 Bcf of
natural gas (18%). Of the 30.2 million Boe of total
proved reserves, 38% are proved developed and 62% are
proved undeveloped. The proved developed reserves consist
of proved developed producing (26%), proved developed
non-producing (4%) and proved developed behind-pipe
(8%).
The
estimated present value, using a 10% discount rate,
of the future net cash flows before income taxes of
the Company's proved oil and natural gas reserves as
of December 31, 2005 was $682.9 million, using year-end
pricing of $55.00 per barrel for oil and $8.20 per Mcf
for natural gas. This compares to $302.4 million at
year-end 2004 using prices of $39.00 per barrel for
oil and $5.19 per Mcf for gas. These estimates are based
on an independent reserve study of Arena's oil and gas
properties prepared by Lee Keeling & Associates,
Inc., Tulsa, Oklahoma.
Total net production for the fourth quarter of 2005
was 172,386 Boe, as compared to 72,965 Boe for the same
period in 2004, an increase of 136%. Net production
for the full year 2005 was 508,430 Boe, compared to
223,333 Boe in 2004, an increase of 127%. The Company's
average net daily production in December 2005 was approximately
2,050 Boe per day.
Mr. Tim Rochford, President & CEO, stated, "We
are very pleased with the operating results for 2005.
Our acquisition and development activities have combined
to replace 1,770% of our 2005 production. Our original
2005 plans called for drilling a minimum of 33 wells,
in addition to various workovers and re-completions
on existing wells. We surpassed those goals and finished
2005 with 42 development wells drilled, 24 re-fracs
and re-completions, participated in the drilling of
two exploratory wells and continued to upgrade and consolidate
the infrastructure on numerous leases. We have received
board approval to increase our capital expenditure budget
for 2006 to up to $65 million, which will allow us to
accelerate our development program, and with the addition
of our own drilling rig scheduled to be in operation
by the end of the first quarter, we plan to drill a
minimum of 120 development wells in 2006 with emphasis
on our Fuhrman-Mascho prospect. We will also continue
to look for acquisitions that will compliment and enhance
our core properties."
About Arena Resources, Inc.
Arena Resources, Inc. is an oil and gas exploration,
development and production company with current operations
in Texas, Oklahoma, Kansas and New Mexico.
This
release contains forward-looking statements within the
meaning of the "safe-harbor" provisions of the Private
Securities Litigation Reform Act of 1995 that involve
a wide variety of risks and uncertainties, including,
without limitations, statements with respect to the
Company's strategy and prospects. Readers and investors
are cautioned that the Company's actual results may
differ materially from those described in the forward-looking
statements due to a number of factors, including, but
not limited to, the Company's ability to acquire productive
oil and/or gas properties or to successfully drill and
complete oil and/or gas wells on such properties, general
economic conditions both domestically and abroad, and
the conduct of business by the Company, and other factors
that may be more fully described in additional documents
set forth by the Company.
For further information contact:
K M Financial, Inc.
Bill Parsons
480-947-1589
k-m-financial@msn.com
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