COMPANY OVERVIEW

Introduction from the CEO

When it comes to energy, Americans want affordable, but also increasingly cleaner sources of energy for our economy and our everyday way of living. Some say you can’t have both. At Denbury, we say, “Yes, we can”! Utilizing tried and tested technologies that have been deployed for nearly four decades, Denbury is revitalizing America’s mature and depleted oil fields with carbon dioxide (“CO₂”) enhanced oil recovery (“EOR”), bringing new life and energy from them that can help fuel our nation for decades to come. Increasingly, CO₂ EOR is also being viewed as a strategy to reduce carbon emissions from new clean energy projects designed to power our nation for this century and beyond. Our CO₂ EOR process provides an economical and technically feasible method of CO₂ disposal, making our nation more energy secure at the same time.

As the nation’s geoscientists, energy policy makers and energy providers come together on strategies that will attempt to provide cleaner, more affordable and abundant energy for our citizens and our industrial base, the benefit of greater utilization of CO₂ EOR is increasingly in the spotlight. What was once thought of as stranded and unreachable oil has now been identified as potentially doubling today’s known reserves — all within the borders of the United States.

The utilization of CO₂ EOR has spurred the design and development of new energy projects advancing clean energy technology, such as coal-to-liquids and Integrated Gasification Combined Cycle (“IGCC”), all of which have great potential for the future. These technologies produce CO₂ like our older, more traditional energy sources, but are being designed to capture the exhaust CO₂ and transport it by pipeline to identified oil fields for use in oil production. Since we inject more CO₂ to produce stranded oil than the amount of CO₂ that is emitted when combusted, it makes sense to put CO₂ to work as a commodity rather than as a waste. CO₂ is non-hazardous, non-flammable and non-explosive and is used in many everyday processes, from soft drinks to fertilizer for food production. It is no wonder that CO₂ EOR is recognized as having excellent potential to produce a more abundant and cleaner energy future.

As one of the leading CO₂ EOR developers in the nation, we accept the responsibility that comes with our efforts to expand America’s CO₂ pipeline network and EOR production capability. The industry and Denbury have a solid and documented safety record, and environmental health and safety is a corporate priority. The Company has grown considerably in the past year, adding key professionals who are guiding this expansion with great skill. Our experience in CO₂ pipeline development now extends to over 800 miles, approximately 75% of which was constructed in the last five years.. We recently commissioned the 325-mile Green Pipeline, a 24-inch CO₂ pipeline that extends our existing Mississippi system across Louisiana and into Texas.  The Green Pipeline is designed to transport 800 million cubic feet per day (“MMcf/d”) of CO₂. We believe this project was completed utilizing the highest standards for compliance with wetland delineation, sensitive habitat and cultural resource requirements. As a result, we are in position to accept large volumes of man-made (“anthropogenic”) CO₂ that in turn can be sequestered in the Gulf Coast region to produce large quantities of stranded oil from existing oil fields.

We expect to begin construction of the 232-mile Greencore Pipeline in August 2011. The Greencore Pipeline is the initial portion of our planned CO₂ pipeline infrastructure in the Rocky Mountain region that will connect the various sources of CO₂ to our oil fields. The first segment of the pipeline will start at the Lost Cabin gas plant and run northeast through Wyoming. In 2012, we plan to complete the pipeline into southeast Montana, where it will initially terminate at Bell Creek Field. This pipeline has a planned capacity of 725 MMcf/d and will greatly expand the capture of industrial CO₂ in the region. The Rocky Mountain region holds great promise as a leader in anthropogenic CO₂ capture, transportation and EOR field development.

This report attempts to describe our strong commitment to professionalism, protection of the environment, the health and safety of our employees and the communities where we operate. This commitment is a primary responsibility that guides our business and extends throughout Denbury from our Board of Directors to our employees.  More than simply saying that we strive to “do the right thing”, we believe that it is our corporate responsibility to show our commitment through the work that we do and the people that do it – day, after day, after day.

We are committed to being good corporate citizens and recognize the important responsibility we have to our employees, shareholders, the environment and the communities in which we operate.

Corporate Responsibility Report 2010

Download Denbury Resources 2010 Corporate Responsibility Report