Tertiary-Operations-

Current Tertiary Operations

Cedar Creek Anticline. The Cedar Creek Anticline (CCA) is the largest Enhanced Oil Recovery (EOR) resource property that we own and is currently our largest producing property, contributing approximately 23% of our 2021 total production. Historical oil production from the property has mainly been from the Red River interval through secondary waterflood recovery. The field is primarily located in Montana but extends into North Dakota and is approximately 126 miles long. On February 1, 2022 we commenced CO2 injection into the Red River formation in our Phase 1 EOR development fields which includes Cedar Hills South Unit and East Lookout Butte. CCA is located approximately 110 miles north of Bell Creek Field, and in November of 2021 we completed install of the 105 mile pipeline to bring COto the CCA fields. In addition to the successful pipeline install, during 2021 we progressed initial injector conversion well work and in-field infrastructure to prepare the fields for COflooding operations. In 2022, we plan to complete the ongoing necessary injector well work and install of recycle facilities for anticipated CO2 response in the second half of 2023. Additional phases of CCA CO2 development will target other formations such as the Interlake, Stony Mountain and Red River formations at Cabin Creek Field.

CCA is a series of 13 different operating areas on a common geological trend, each of which could be considered a field by itself. We acquired our initial interest in CCA as part of the Encore merger in 2010 and acquired additional interests from a wholly-owned subsidiary of ConocoPhillips in 2013. In addition to the Red River formation, CCA contains other oil-bearing intervals including Mission Canyon and Charles B. We began pursuing these additional exploitation opportunities in late 2017. We have drilled ten successful Mission Canyon exploitation wells and a successful initial test well in Cabin Creek's Charles B formation over the last few years. We continue to evaluate the Charles B formation and believe it has characteristics that would make it a good candidate for secondary or tertiary flooding.   

Bell Creek Field. We acquired our interest in Bell Creek Field in southeast Montana as part of the Encore merger in 2010. The oil-producing reservoir in Bell Creek Field is a sandstone reservoir with characteristics similar to those we have successfully flooded with CO2 in the Gulf Coast region. During 2013, we began first CO2 injections into Bell Creek Field, recorded our first tertiary oil production, and booked initial proved tertiary reserves. During 2018, we completed the phase five expansion at the field, and in April 2019, commenced CO2 injection into phase six of the field development.

Grieve Field. Under a 2011 farm-in agreement, we obtained a 65% working interest in Grieve Field, located in Natrona County, Wyoming, in exchange for developing the Grieve Field CO2 flood. During 2016, the Company and its joint venture partner in Grieve Field revised their development arrangement for the field so that our partner funded development of the facility and fieldwork in exchange for a 14% higher working interest and a disproportionate sharing of revenue from the first 2 million barrels of production. We commenced tertiary production from Grieve Field during the fourth quarter of 2018 and booked initial proved tertiary reserves during 2019. In October 2020, we foreclosed on the joint venture partner’s interest, and we obtained record title to their interest in February 2021.

Salt Creek Field. We acquired our 23% non-operated working interest in Salt Creek Field in Wyoming for approximately $72 million in June 2017.

Wyoming CO2 EOR Fields. In March 2021, we acquired a nearly 100% working interest (approximately 83% net revenue interest) in the Big Sand Draw and Beaver Creek oil fields located in Wyoming for $12 million cash, including surface facilities and a 46-mile CO2 transportation pipeline to the acquired fields. The agreement provides for us to make two contingent cash payments of $4 million each in 2021 and 2022 if NYMEX WTI oil prices average at least $50 per Bbl during the respective calendar years.



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