GeoResources, Inc. provides operations update
  by: OilOnline
  Thursday, May 01, 2008

GeoResources, Inc. continued its successful development of its Austin Chalk acreage through its horizontal drilling program in the Giddings Field, principally located in Grimes County, Texas. Two additional wells have been completed in the first quarter, resulting in a 100% success rate since initiation of the program in February 2007. The East Richards #1-H was completed in March as a single lateral and has averaged 9.7 MMCFPD over the first 30 days of production. Based on performance, an offsetting infill location may be drilled, on acreage that is held by production, to capture additional reserves. The Keisler #1-H, which was completed in Jan 2008, had cumulative production of almost 900 MMCF in its first 90 days of production and is currently producing over 11 MMCFPD. The Company is currently drilling the Jeff Haynie #1-H as a dual lateral. This well is expected to be completed during May. The rig will then move to the Keisler #2-H which is a direct offset to the Keisler #1-H.

Current operated gross production from the properties is approximately 51 MMCFPD. The current rate is 175% over the 29 MMCFPD that field averaged during January 2007, immediately prior its acquisition. The increase is a direct result of the drilling program and other activities initiated by the Company, including, operational workovers, re-engineering enhancements and pipeline improvements. The Company has acquired additional acreage and is in the process of permitting more drilling locations. Based on continued technical review, successful leasing and acceptable well performance, GeoResources expects to retain the current drilling rig and crew and spud a new well approximately every 60-75 days for the next three years. The Company is the operator of the wells and holds a direct 7.2% working interest. In addition, an affiliated partnership owns an 82.8% working interest. As general partner and partnership manager, the Company holds a 2% general partner interest which may increase to 35.66%, in accordance with terms of the partnership agreement.

In south Louisiana, the Company recently completed two shallow exploration wells in Lafourche Parish. The Davaine and Parr wells are both located in the Raceland field and since completion, have averaged 97 BOPD and 450 MCFPD for the two wells combined. This project will continue with two additional prospects expected to be drilled in the summer of 2008. These prospects were generated prior to consummation of the Merger in April 2007, and the majority of the prospect interests were promoted out to industry partners. Accordingly, the Company has a 10% working interest and the terms of participation included a retained over-riding royalty and back-in after payout.

GeoResources has completed drilling a shallow multi-lateral horizontal oil well in its Wayne field, located in Bottineau County, North Dakota. The Oscar Fossum H5 is currently being completed and has tested oil rates exceeding 200 BOPD. Initial production is expected in May. Production equipment and facilities are presently being installed. The Company has a 67% working interest in this well. The drilling rig was moved to the Ballantyne-State/Steinhaus H2 and is presently drilling the first of two planned laterals. The Company has a 100% working interest in the Ballantyne-State/Steinhaus H2, which should be completed in May and placed on production in the 2^nd quarter. These are relatively shallow wells with a true vertical depth of approximately 4,000 feet. Both wells are expected to be similar to other horizontal wells in the area which have had initial rates of up to 275 BOPD and reserves ranging from 250-400 MBO per well.

The Company and its joint venture partner, Slawson Exploration, are in the process of completing a horizontal Bakken well in Mountrail County, North Dakota. The Company has a 5.1% working interest in the Pathfinder #1-9H, being the first of a multi-well Slawson operated drilling program in and near the prolific Parshall and Sanish fields. The Pathfinder well, which encountered hydrocarbons while drilling, is currently undergoing multi-stage frac operations and is expected to be completed in May. Drilling has commenced on the Jackal #1-17H and Slawson plans to keep the rig drilling throughout 2008 and 2009. At present 13 wells are scheduled and GeoResources working interests range from 5 to 10% in these wells. The joint venture holds approximately 26,000 net acres in Mountrail County. GeoResources has participated in eight wells and currently expects to participate in six additional scheduled wells which are operated by other independents. Four of the wells are producing and others are drilling or completing. These participations are financially nominal and thus far average less than 1%, due to minimal lease ownership in such units. However, these nominal participations result in valuable engineering and geological data. While the Company will concentrate on Slawson operated wells, it is evaluating technical information and attempting to increase its position in this expanding play.

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