UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
---------------
Date of Report (Date of earliest event reported): February 19, 2002
BRIGHAM EXPLORATION COMPANY
(Exact name of registrant as specified in its charter)
Delaware 000-22433 75-2692967
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
6300 Bridgepoint Parkway
Building Two, Suite 500
Austin, Texas 78730
(Address, including zip code, of principal executive offices)
Registrant's telephone number, including area code: (512) 427-3300
Item 5. Other Events.
On February 14, 2002, the Registrant issued a press release to disclose
its year-end 2001 proved reserves and announce its planned 2002 capital budget.
The full text of the press release which is set forth in Exhibit 99.1 hereto is
filed and incorporated in this Report as if fully set forth herein.
Item 7. Financial Statements and Exhibits.
(c) Exhibits
Item Exhibit
99.1* Press Release dated
February 14, 2002.
- -------
* filed herewith.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BRIGHAM EXPLORATION COMPANY
Date: February 19, 2002 By: /s/ Curtis F. Harrell
---------------------------
Curtis F. Harrell
Executive Vice President &
Chief Financial Officer
EXHIBIT 99.1
INDEX TO EXHIBITS
Item Number Exhibit
99.1* Press Release dated
February 14, 2002.
NEWS RELEASE
FOR IMMEDIATE RELEASE
BRIGHAM EXPLORATION ANNOUNCES 306 PERCENT RESERVE REPLACEMENT AND $1.23 F&D COST
FOR 2001; $24 MILLION CAPITAL BUDGET FOR 2002
- --------------------------------------------------------------------------------
Austin, TX -- February 14, 2002 -- Brigham Exploration Company
(NASDAQ:BEXP) today disclosed its year-end 2001 proved reserves and announced
its planned 2002 capital budget.
YEAR-END 2001 PROVED RESERVES AND FINDING COSTS
Brigham's estimated net proved reserve volumes at December 31, 2001 totaled
111 Bcfe, which represents a 17% increase from its 95 net Bcfe at year-end 2000.
During 2001, Brigham added 29.2 Bcfe, primarily through drilling activities in
its Anadarko Basin, Texas Gulf Coast and West Texas 3-D seismic projects.
Brigham's 2001 drilling program generated net proved reserve additions that
replaced 306% of its 9.6 Bcfe of net volumes produced during the year.
Approximately 80% of Brigham's year-end 2001 reserve volumes are natural gas and
49% are proved developed.
The present value of Brigham's estimated proved reserves, calculated in
accordance with SEC guidelines ("PV10% Value"), is $147 million at year-end
2001. Lower year-end oil and gas prices resulted in a decrease in the PV10%
value for 2001 versus that reported for 2000. PV10% Value for 2001 was
calculated using a Henry Hub natural gas price of $2.57 per MMBtu and a West
Texas Intermediate Sweet price of $19.84 per barrel versus a Henry Hub natural
gas price of $10.42 per MMBtu and a West Texas Intermediate Sweet price of
$26.83 per barrel that were used for the 2000 year-end.
Capital expenditures incurred during 2001 totaled $36.0 million (including
capitalized G&A and interest), approximately 75% of which related to drilling
activities. As a result, Brigham's average finding costs for reserves added in
2001 (including revisions to prior estimates) were $0.93 per Mcfe based only on
drilling expenditures and $1.23 per Mcfe based on total capital expenditures. In
addition, Brigham's three-year average finding costs for reserves added
(including revisions to prior estimates) was $0.74 per Mcfe based only on
drilling expenditures and $1.00 per Mcfe based on total capital expenditures.
Equivalent Reserves
--------------------------
(Bcfe)
---------------------------
---------------------------
2001 Beginning Reserves 95,387
Discoveries & Extensions 29,164
Revisions of Previous Estimates 141
Purchases of Reserves in Place 0
Sales of Reserves in Place (4,038)
Production (9,573)
---------------------------
---------------------------
2001 Ending Reserves 111,081
===========================
2002 CAPITAL EXPENDITURE BUDGET
Brigham also announced the approval, by its board of directors, of a
$23.7 million capital expenditure budget for 2002. The spending will be funded
out of Brigham's discretionary cash flow and liquidity under its subordinated
credit facility. Depressed commodity prices led to a budgeted decrease in
capital spending of $12.3 million (34%) for 2002 when compared to 2001 capital
spending. Brigham's budget is based on anticipated commodity prices and is
subject to change if market conditions shift.
The 2002 capital budget includes the planned drilling of 26 wells with
an average working interest of 32%. Due to recent field discoveries,
approximately 80% of Brigham's planned 2002 drilling expenditures are allocated
to development drilling. In addition, approximately 95% of budgeted drilling
expenditures will be directed to five geologic plays where Brigham has recently
completed 25 wells in 28 attempts. These focus plays include the Springer and
Hunton trends of the Anadarko Basin, the Vicksburg and Frio trends of the Texas
Gulf Coast and the Horseshoe Atoll trend in West Texas.
Capital Expenditures ($MM)
2001 2002
Estimated Budget
Drilling $27.2 $15.6
Land and G&G 2.8 2.3
Total Exploration and Development $30.0 $17.9
Capitalized Costs and Other 6.0 5.8
Total Capital Expenditures $36.0 $23.7
================================================================================
MANAGEMENT COMMENT
Bud Brigham, the Chairman and CEO stated, "Given the challenges in
2001, particularly with regard to managing higher service costs, we are
extremely pleased with our 2001 finding costs. As was the case in both 1999 and
2000, in 2001 we made a significant field discovery with the Triple Crown
Vicksburg Field. In addition, in late 2001, we announced our Providence Frio
Field discovery. Due to the planned development of these two new field
discoveries, combined with the development of our prior Home Run and Mills Ranch
Field discoveries, we estimate that approximately 80% of our 2002 drilling
expenditures will be developmental."
Bud Brigham further stated, "Our Triple Crown and Providence Field
discoveries occurred late in 2001. As a result, these new discoveries will not
materially impact our production volumes and cash flow until 2002. Further, in
2002 we will benefit significantly from a number of operational enhancements,
particularly in the drilling and completion of our Vicksburg wells in our Home
Run and Triple Crown Fields, while also expending less capital per well due to
lower drilling and completion costs. Therefore, given our recent field
discoveries, and the success we're enjoying with our ongoing exploration
drilling program, we expect 2002 to again provide our shareholders with growth
in reserves, production volumes and cash flow."
ABOUT BRIGHAM EXPLORATION
Brigham Exploration Company (www.bexp3d.com) is an independent
exploration and production company that applies 3-D seismic imaging and other
advanced technologies to systematically explore and develop onshore domestic
natural gas and oil provinces.
FORWARD LOOKING STATEMENTS DISCLOSURE
Except for the historical information contained herein, the matters
discussed in this news release are forward looking statements that are based
upon current expectations. Important factors that could cause actual results to
differ materially from those in the forward looking statements include risks
inherent in exploratory drilling activities, the timing and extent of changes in
commodity prices, unforeseen engineering and mechanical or technological
difficulties in drilling wells, availability of drilling rigs, land issues,
federal and state regulatory developments and other risks more fully described
in the company's filings with the Securities and Exchange Commission.
Contact: John Turner, Manager - Finance & Investor Relation
(512) 427-3300 / investor@bexp3d.com