Evolution Petroleum Provides Commentary on Delhi Field Remediation ahead of its Presentation at EnerCom's The Oil & Gas Conference® 18 in Denver

HOUSTON, Aug. 8, 2013 /PRNewswire/ -- Evolution Petroleum Corporation (NYSE MKT: EPM) announced today that it will present at EnerCom's The Oil & Gas Conference® 18 in Denver, to be held at the Westin Denver Downtown hotel on August 11-15, 2013.

Robert S. Herlin, Chairman, President and Chief Executive Officer is scheduled to make a presentation on Tuesday, August 13, 2013 at 9:40 a.m. Mountain Standard Time (11:40 a.m. Eastern Standard Time) and will be joined by Sterling H. McDonald, Chief Financial Officer.  The presentation will be webcast live over the internet and can be accessed, along with the accompanying slides, from http://www.investorcalendar.com/IC/CEPage.asp?ID=171271&CID=. The presentation materials will be available on the Company's website the day of the event.

Recent Developments at Delhi Field

The operator of the Delhi Field, where Evolution Petroleum Corporation ("Evolution") owns royalty interests and a reversionary working interest, recently reported on the status of a release of fluids discovered in June. The operator, a subsidiary of Denbury Resources, previously stated that the fluids released were primarily CO2 with smaller amounts of salt water, natural gas and a smaller amount of oil. The operator took immediate remedial action to stop the release and contain and remove all liquids in the affected area, and is working with government officials and agencies to complete the remediation. The cause of the leak is still under investigation by the operator. During the remediation, the operator has temporarily halted CO2 injection in the affected area surrounding one or more previously abandoned wells in order to relieve pressure during the remediation. Production from wells in the affected area has continued, but oil production from those particular wells has declined due to the reduced injection volumes that provide the necessary "drive" for tertiary oil production.

At this time, we are not working interest owners in the Holt Bryant Unit of the Delhi Field and therefore are not bearing any cash costs of the remediation, the amount of which the operator has recently estimated to be a minimum of $70 million. However, revenues to our royalty interest are being temporarily impacted by the reduction in oil production in the affected area.

We are evaluating the impact of the remediation on our interests in relation to our existing agreements with the operator. The reduced oil production level and remediation costs, to the extent not covered by the operator's indemnity and contractually assumed obligations and net of any associated insurance reimbursements, are currently expected to delay the date that our reversionary working interest becomes effective. The extent of the delay is uncertain and also depends upon other variables including the temporary reduction in purchased CO2 volumes and oil prices.

The operator has projected that CO2 injection will resume in the affected area by the 4th calendar quarter of 2013, and further stated that CO2 injection and oil production in the larger portion of the field are continuing. 

We have no current expectation that ultimate field recoveries and reserves at Delhi will be materially impacted from those reported as of July 1, 2012, adjusted for production, and we are continuing to monitor the field operations in our limited role as a non-working interest royalty owner. 

About Evolution Petroleum

Evolution Petroleum Corporation develops incremental petroleum reserves and shareholder value by applying conventional and specialized technology to known oil and gas resources, onshore in the United States.  Principal assets as of June 30, 2012 include 13.4 MMBOE of proved and 12.7 MMBOE of probable reserves, before adjustment for the divestment of noncore assets in the Giddings Field, and no debt.  Producing assets include a CO₂-EOR project with growing production in Louisiana's Delhi Field and producing wells and proved drilling locations in the Giddings Field and Lopez Field in Texas.  Other assets include an interest in a joint venture in the Mississippian Lime play in Kay County, OK, and a patented artificial lift technology designed to extend the life of horizontal wells with oil or associated water production.  Additional information, including the Company's annual report on Form 10-K and its quarterly reports on Form 10-Q, is available on its website at (www.evolutionpetroleum.com)

Cautionary Statement

All statements contained in this press release regarding potential results and future plans and objectives of the Company are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update or review any forward-looking statement, whether as a result of new information, future events, or otherwise. Important factors that could cause actual results to differ materially from our expectations include, but are not limited to, those factors that are disclosed under the heading "Risk Factors" and elsewhere in our documents filed from time to time with the United States Securities and Exchange Commission and other regulatory authorities. Statements regarding our ability to complete transactions, successfully apply technology applications in the re-development of oil and gas fields, realize future production volumes, realize success in our drilling and development activity and forecasts of legal claims, prices, future revenues and income and cash flows and other statements that are not historical facts contain predictions, estimates and other forward-looking statements. Although the Company believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved and these statements will prove to be accurate. Important factors could cause actual results to differ materially from those included in the forward-looking statements.

Company Contact: 
Sterling McDonald, VP & CFO
(713) 935-0122
[email protected]

SOURCE Evolution Petroleum Corporation