GEOI Georesources, Inc. (MM)

GeoResources, Inc., (NASDAQ: GEOI), today provided an operations update.

BAKKEN SHALEThe Company holds a proportionate 10% - 18% working interest in approximately 110,000 net acres in the Bakken Shale trend of the Williston Basin. Approximately 63,000 acres are located in Mountrail County, with the remainder located in adjacent counties. To date, the Company has realized a 100% success rate with 30 successful wells drilled by the joint venture operator. In addition, the Company owns minor working interests in more than 125 wells within the Bakken/Three Forks play. These wells have provided invaluable information related to the development economics, geology and drilling and completion procedures with multiple operators at different locations within the basin. Our joint venture continues to acquire acreage in this expanding play and is currently running three rigs and may occasionally run a fourth drilling rig.

The following table provides an overview of our activities for 2009. The Company reports joint venture and other wells where its interests are meaningful, but generally does not report numerous minor interest wells. With the significant acreage acquisition in May 2009 and subsequent acreage additions, the pace of activity has increased and we expect to participate in more than 60 joint venture wells over the next 18 months, exclusive of the participation in numerous minor interest wells.

                          STATUS

 

SPACING

WI IP (BOPD) (OR

WELL NAME

UNIT

24 HOUR ESTIMATED             TEST   SPUD DATE)  

1st Qtr

Jericho #1-5H 640 6.24% 753 Producing Wombat #1-25H 640 8.05% 541 Producing Colt #1-16H 640 8.71% 387 Producing  

2nd Qtr

Banshee #1-1H 640 5.45% 1060 Producing Nightcrawler #1-17H 640 6.66% 935 Producing Polaris #1-21H 640 7.89% 370 Producing Mamba #1-20H 640 8.86% 894 Producing Meerkat #1-12H (1) 557 10.00% 1,344 Producing Bandit #1-29H 640 7.00% 480 Producing  

3rd Qtr

Wolf #1-4 640 7.12% 533 Producing Holst #1-33 640 9.70% 825 Producing Meerkat #1-7H (1) 557 8.50% 726 Producing Genesis #1-13H 640 8.45% 1274 Producing Fox #1-28H 640 14.40% --- Completing Minx #1-29H 640 9.90% --- Completing Coyote #1-32H 640 5.40% 1383 Producing Tempest #1-14H 640 5.00% --- Completing Bazooka #1-20H 640 10.74% --- Completing Zulu #1-21H 640 13.08% --- Completing  

4th Qtr

Skybolt #1-24H 640 5.40% Drilling Drilling Stallion #2-1-12H 1280 11.70% Moving In 10/15/2009 Goldeneye #2-2H(2) 640 4.34% Drilling Drilling Banshee #2-1H 640 5.41% --- 10/30/09 Howitzer #1-25H 640 14.40% --- 11/3/09 Zephyr #1-36H 640 12.03% --- 11/14/09 Ripper #1-22H 640 5.27% --- 11/24/09 Cougar Fed #1-30H 640 12.19% --- 11/28/09 Cannonball #1-27H 640 8.00% (est.) --- 12/9/09 Tarantula #1-16H 640 4.69% --- 12/19/09

Machete #1-19H

640 8.08% --- 12/23/09

(1) Meerkat wells were drilled on a single 557 acre pooled unit.(2) Goldeneye #2-2H is an increased density well being the second well on a 640 acre unit.

Completed well costs, including surface equipment and production facilities for single lateral wells drilled on 640 acre units range from approximately $3.0 to $3.5 million. The economics of drilling on 640 spacing units are attractive and allows us to “prove-up” and place acreage on production under an expedited schedule. Further, where we drill two or more wells off a single pad, additional vertical well bores may allow for further cost-effective development from in-fill locations or deeper horizontal drilling. However, we are scheduling 1,280 acre (and some larger) spacing units and have numerous locations which may result in or require such larger spacing units.

AUSTIN CHALKThe Company expects to spud its next well within thirty days. The next two or three locations will be on the north-west side of our acreage block where we expect the reserves to be more “oily” and result in about 50% oil and liquids. To date, the Company has drilled 13 Austin Chalk wells and achieved a 100% success rate. Our present inventory includes 15 proved undeveloped and probable locations within the Giddings Field. At present, we expect to sequentially drill all locations with a single drilling rig. Our working interest varies from 50% to 53%.

Comments

Frank A. Lodzinski, Chief Executive Officer of GeoResources, said, “Our drilling programs continue to deliver positive results. The Bakken Shale development play has recently been expanded and provides a continuous opportunity to add reserves and production. We have interests in approximately 110,000 acres, with over 63,000 acres located in the heart of the play in Mountrail County. After a 60 day suspension of drilling, we are anxious to spud our next Austin Chalk well. This development program has delivered production and reserve growth. We have a current development inventory of at least 15 locations where we will have in excess of a 50% working interest. Our acreage position exceeds 68,000 acres, a majority of which is held by production and is prospective for the shallow Yegua and for the Eagle Ford Shale, Buda and Georgetown formations. We continue to seek attractive acreage additions in both of these successful core areas. Our strong cash flows, earnings, and liquidity provide adequate funding for our capital programs.”

About GeoResources, Inc.GeoResources, Inc. is an independent oil and gas company engaged in the acquisition and development of oil and gas reserves through an active and diversified program which includes purchases of reserves, re-engineering, and development and exploration activities, currently focused in the Southwest, Gulf Coast and the Williston Basin. For more information, visit our website at www.georesourcesinc.com.

Forward-Looking Statements

Information herein contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as "may," "will," "expect," "anticipate," "estimate" or "continue," or comparable words. All statements other than statements of historical facts that address activities that the Company expects or anticipates will or may occur in the future are forward-looking statements. Readers are encouraged to read our 10-K/A for the year ended December 31, 2008 and the other SEC reports of the Company and any and all other documents filed with the SEC regarding information about GeoResources for meaningful cautionary language in respect of the forward-looking statements herein. Interested persons are able to obtain free copies of filings containing information about GeoResources, without charge, at the SEC’s Internet site (http://www.sec.gov).