Miller Exploration Company Announces Receipt of Bank Commitment Letter And Operational Update
June 16, 2000 10:31 AM Eastern Time
HOUSTON, June 16 /PRNewswire/ -- Miller Exploration Company MEXP , the "Company" or "Miller" announces receipt of bank commitment letter and operational update.
* Commitment Letter received from Bank One, Texas, NA.
* Centerville Dome production increased by 170% to approximately 2.0 MMCFE/d.
* Midway Dome production increased by 22% to 16.6 MMCFE/d
* Five drilling permits applied for in the Mississippi Salt Basin.
DEBT FINANCING
Miller Exploration has received a commitment letter from Bank One, Texas, NA, which represents a 30-month reducing revolving term loan at prime plus 2%. The borrowing base under this new facility is $12.5 million, which will require the Company to raise $5 million in equity to pay down its existing bank debt. Management currently believes the conditions precedent in the commitment letter, including the required equity, can be satisfied prior to closing.
The Company has requested a 30-day extension of its June 15, 2000, borrowing base redetermination from its existing senior lender, Bank of Montreal, to allow time for the necessary document preparation. The current outstanding balance with its senior lender is approximately $17.4 million.
COMMODITY HEDGING
The Company currently has approximately 50% of current daily gas production hedged through March 31, 2001, at prices ranging from $2.52/MCF to $4.40/MCF. The lower hedges of $2.52/MCF (2 MMCF/d) and $3.00/MCF (4 MMCF/d) expire in August 2000 and September 2000, respectively. The Company has also hedged 250 BOPD at $29.60 for July through September 2000.
OPERATIONAL UPDATE
Miller Exploration currently has an involvement in wells being drilled in Cameron Parish, Louisiana and Covington County, Mississippi. Drilling permits have also been applied for on Arm Dome, Grange Dome, Kola Dome, and Moselle Dome.
Producing Wells: Centerville Dome, Jones County, Mississippi
Miller recently re-completed the Ellzey #1 and has realized a gross daily production of 1.0 MMCF/d and 639 BOPD. Miller's net increase is 165 MCFD and 256 BOPD.
Midway Dome, Lamar County, Mississippi
Compression has been added to the Allar #1, Allar #6 and Patterson #1 wells at Midway Dome. This has resulted in a gross incremental increase of 3 MMCFD for the field to 16.6 MMCFD. Miller's net increase is 1.7 MMCFD. Miller is finalizing installation of compression on the Allar #2 which should be in operation by June 21, 2000.
Drilling: Chenier Perdue Prospect, Cameron Parish, Louisiana
In Cameron Parish, Louisiana, Miller is participating in the Ballard Exploration operated Miami Corporation B #1 well. This well is a 3-D seismic controlled prospect being drilled to test the Camerina Sands at 13,000 feet. The well is drilling below intermediate casing which was set at 9,730 feet. Miller has approximately a 14% interest in this prospect.
Eminence Dome, Covington County, Mississippi
The Crosby #1 well was spud on May 9, 2000, and is intended to test the Hosston and Cotton Valley formations at 18,500 feet. The well is currently drilling below 12,140 feet. Remington Oil and Gas Corporation is the operator. Miller has approximately a 23% working interest in this well. This prospect is also supported by 3-D seismic.
Permitting: Kola Dome, Covington County, Mississippi
Miller's partner, Key Production Company, has filed for a permit for the Langston #2 well to be drilled to test the Hosston at Kola Dome. The Langston #1, which was completed for a rate of 9 MMCFD and 450 BOPD in May, is awaiting final hook up, which should commence on Saturday, June 17, 2000. Miller has approximately a 17% working interest in these two wells.
Moselle Dome, Jones County, Mississippi
Miller has applied for a permit for the Miller-Lewis Oil Properties 8-2 #1, to be drilled as the south offset to the Roundtree Frost #1, in the Parker Creek Field. The Frost #1 is a strong well which is producing at rates in excess of 750 BOPD. Four wells are currently producing at Parker Creek Field on Moselle Dome.
Arm Dome, Lawrence County, Mississippi
Miller's partner, Key Production, has applied for a permit to drill the Endymion #1, a 17,200 foot Hosston test. Miller has approximately a 46% interest in this prospect. This is a 3-D seismic supported test.
Grange Dome, Lawrence County, Mississippi
Miller has applied for a drilling permit of the Miller-Sills #1. This well is a 3-D seismic controlled prospect targeted as a 17,500 foot Hosston test. Miller has approximately a 46% working interest in this well.
Southwest Kola Prospect, Covington County, Mississippi
Miller and its partner Remington Oil and Gas have permitted the Pickering #1, a 19,000 foot Cotton Valley test on the Southwest Kola Prospect. This is a 3-D seismic controlled interdomal prospect designed to explore for hydrocarbons on a "turtle structure" similar to what produces at Collins Field which has produced a cumulative 5.9 billion cubic feet of gas and 4.9 million barrels of oil from the Cotton Valley, Hosston, Sligo, Rodessa, Paluxy and Mooringsport formations. Miller has approximately a 38% working interest in this prospect.
Miller is an independent oil and gas exploration and production company with established exploration efforts concentrated primarily in the Mississippi Salt Basin. Miller emphasizes the use of 3-D seismic data analysis and imaging, as well as other emerging technologies, to explore for and develop oil and natural gas in its core exploration areas. Miller is the successor to the independent oil and natural gas exploration and production business first established in Michigan by members of the Miller family in 1925. Miller's common shares trade on the NASDAQ under the symbol MEXP. |
