Energy Prospectus

I am now working on the DNR forecast model but I want to bring this to your attention.
> DNR will get a big boost to production in Q2 from the assets acquired in the Cedar Creek Anticline.
> The DNR operated Delhi Field should reach payout late in the 3rd quarter and EPM's net revenue interest in the field will increase from 7.4% to 26.5% at Payout. You can find our profile on EPM under the Watch List Tab.
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Phil Rykhoek, Denbury's President and CEO, commented, "We are off to a strong start in 2013 as we continue to execute on our proven, unique, and repeatable growth strategy. Quarterly oil production from our core tertiary business exceeded our expectations, reaching a new record level in the first quarter, while our realized oil price premium in the quarter was our highest ever. From a total production standpoint, the first quarter was a transition quarter for us as we sold our Bakken area assets in the fourth quarter of 2012 but did not acquire the replacement assets in the Cedar Creek Anticline until almost the end of the first quarter of 2013. These newly acquired properties are currently producing around 11,000 BOE/d net to our interest, and we expect over 20% of our total daily production to come from the Cedar Creek Anticline for the remainder of 2013.

"With the solid start to the year, we now estimate that both our tertiary and total production will be in the upper half of our currently estimated 2013 production ranges. Further, with our well-defined and lower-risk growth outlook and the high returns of our tertiary investments, we are uniquely positioned to grow per-share value for the foreseeable future."

Production

Production for the first quarter of 2013 averaged 63,823 BOE/d, which included 39,057 Bbls/d from tertiary properties and 24,766 BOE/d from non-tertiary properties. First quarter total production was down approximately 11%, or 7,709 BOE/d, compared to that in the first quarter of 2012, principally due to the asset sales in late 2012. Excluding the impact of asset sales, continuing production was up approximately 17%, or 9,338 BOE/d, due in part to a 17% increase in tertiary production, or 5,800 BOE/d, and the remainder primarily due to 2012 acquisitions. The sequential and year-over-year quarterly tertiary production increases reflect growing production at the Company's newest tertiary floods at Hastings and Oyster Bayou fields combined with production gains from the expanding tertiary floods at Delhi and Tinsley fields. The increases in non-tertiary production for the same periods were the result of the assets acquired in 2012 and 2013.

Denbury's capitial expenditures budget will be more than covered by this year's cash flows from operations, which should exceed $1.3 Billion. I am expecting them to continue an aggressive share repurchase plan that is reducing outstanding shares & will increase earnings per share. - Dan
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Denbury's 2013 capital expenditure budget was recently increased by $60 million, to $1.06 billion. The additional $60 million will primarily fund capital projects on the newly acquired Cedar Creek Anticline properties and capital projects scheduled for 2012 that were carried into 2013. The budgeted amount excludes potential acquisitions, and approximately $160 million of estimated capitalized costs (including capitalized corporate exploration and development overhead; geological and geophysical costs; capitalized interest; and pre-production start-up costs associated with new tertiary floods), which is up from the previous estimate of these capitalized costs of $125 million. Denbury expects its 2013 capital expenditure budget to be fully funded with its estimated cash flow generated from operations in 2013 assuming NYMEX oil prices average in the low $90 per Bbl range for the year.

Denbury continues to repurchase shares from time to time under its share repurchase program, acquiring a total of 4.7 million shares in 2013 through the end of April, to bring total purchases under such program since its commencement in October 2011 to nearly 36 million shares, or about 9% of shares outstanding at September 30, 2011, at an average cost of just over $15 per share. Another $229 million of share repurchases remained authorized under the program as of April 30, 2013.

Denbury Resources (DNR): An updated Net Income & Cash Flow Forecast model has been posted under the Sweet 16 Tab.