DNR updated forecast model

[dan_s]

My updated Net Income and Cash Flow Forecast for Denbury Resources (DNR) will be available under the Sweet 16 tab on August 5. The model includes my estimated "Fair Value" or break-up value for the company. - Dan

Phil Rykhoek, Chief Executive Officer, said, “Our results underline the benefits of our being so heavily weighted toward oil in this commodity price environment, enabling us to report record quarterly cash flow from operations, even with lower than targeted production growth. Not only are we more than 90% oil-weighted, but we sell approximately 60% of our oil based on price indexes other than NYMEX WTI prices, resulting in our first ever positive NYMEX oil price differential on a total corporate basis.

DNR's realized oil price was $106.30/bbl and they will continue to receive a significant premium for their oil over WTI prices.

"We expect production growth to accelerate in 2012, as our long-term projects to flood our two newest tertiary fields, Hastings and Oyster Bayou Fields, are on schedule, with anticipated initial oil production expected late this year and late in the first quarter of 2012, respectively, and our Bakken well results in the Cherry area, our largest acreage position, continue to exceed expectations.”

DNR's 2nd quarter production was 64,919 boepd (90% oil). They are on-track to exit the year at over 68,000 boepd.