GMX RESOURCES INC. Provides Updated Reserves and Other Information

Mon May 13, 2013 3:09pm EDT

* Reuters is not responsible for the content in this press release.

OKLAHOMA CITY, May 13, 2013 (GLOBE NEWSWIRE) -- GMX RESOURCES INC., (OTC Markets:GMXRQ) (the "Company"); is an oil and gas exploration and production Company with assets in the Williston Basin, Denver Julesburg ("DJ") Basin and East Texas Basin.

The Company is providing the following production information and an updated sensitivity analysis regarding the Company's estimated proved reserves in connection with information being provided to potential purchasers of the Company's assets. As previously disclosed, the Company's year-end 2012 reserve estimates were prepared by DeGolyer and McNaughton, an independent reserve engineering firm.   

January 2013 Production

Average daily production of the Company's Bakken properties for January 2013 was 533 BOE/ day. The Company's East Texas production, including Haynesville/Bossier properties, was 13.9 MMcfe/day during January 2013. The Company's total average daily production was 2,843 BOE/day during January 2013.

March 31, 2013 Estimated Proved Reserves

Based on management's roll-forward of estimated proved reserves as of March 31, 2013, based on an average annual NYMEX strip pricing as of April 18, 2013, and after deductions for first quarter 2013 production and including certain changes in interests for asset swaps of undeveloped acreage including proved undeveloped (PUD) locations and anticipated timing for PUD drilling (but without further adjustments for type-curves based on first quarter 2013 production or changes that may be applicable based on timing of current projected future drilling), the Company's estimated proved reserves with respect to certain areas is set forth below. Since the Company is currently operating as a debtor-in-possession following its April 1, 2013 filing for Chapter 11 bankruptcy protection under a limited capital budget, it cannot reasonably forecast, and is not updating any prior public projections regarding, its future drilling program.

NYMEX Natural Gas and Oil Pricing

Proved Reserves 3/31/13 –Annual Average NYMEX Natural Gas and Oil Strip Pricing(a)

           
  Oil/NGLs
MMbls
Natural Gas
Bcf
MMBOE PV-10(b)
($ in Millions)
PV 10 %
Total Proved
Proved Developed          
Bakken/Three Forks 2.0 1.2 2.2 $51.5 20.7%
Haynesville/Bossier  55.0 9.2 93.2 37.6%
Cotton Valley and Other  0.4 0.1 1.0 0.4%
Proved Undeveloped          
Bakken/Three Forks 7.6 4.2 8.3 38.0 15.3%
Haynesville/Bossier  106.0 17.7  64.4  25.9%
Cotton Valley and Other   —
Total Proved (c) 9.6 166.9 37.4 $248.1 100.0%

(a)   Company roll forward of DeGolyer and MacNaughton prepared December 31, 2012 report with interest changes and PUDs retimed. The proved reserves as of March 31, 2013 for oil are calculated based on the annual average NYMEX West Texas Intermediate ("WTI") price as of April 18, 2013 adjusted for quality, transportation fees and regional price differentials. The annual averages used for oil were $86.83, $84.91, $83.34, $82.43, $81.85, $81.37, $80.98, $80.46, and $80.24 for 2013, 2014, 2015, 2016, 2017, 2018, 2019, and 2020 and thereafter, respectively per barrel. For natural gas the proved reserves were based on the annual average NYMEX strip price as of April 18, 2013. The annual averages used were $4.68, $4.52, $4.58, $4.68, $4.80, $4.99, $5.21, $5.47, $5.79, $6.13, $6.48, $6.85 and $7.22 for 2013, 2014, 2015, 2016, 2017, 2018, 2019, 2020, 2021, 2022, 2023, and 2024 and thereafter, respectively per MMBTU and was adjusted for energy content, transportation fees, regional price differences, and system shrinkage.

(b)   PV-10 represents the present value, discounted at 10% per annum, of estimated future net revenue before income tax of the Company's estimated proved reserves. The PV-10 value is different than the standardized measure of discounted estimated future net cash flows which is calculated after income taxes. The Company believes the PV-10 is a useful measure for evaluating the relative monetary significance of their proved reserves. Investors may use the PV-10 as a basis for comparison of the relative size and value of the Company's reserves to its peers. However, due to the Company's fully reserved net deferred tax assets, its standardized measure of discounted estimated net cash flows is currently the same as its PV-10.

(c)   Totals may not equal the sum due to rounding.

Summary of Reserve Differences for Sensitivity Comparisons

Bakken - 10.5 MMBOE (versus 8.9 MMBOE in December 31, 2102 SEC reserve report), based on 19 producing wells, 22 net PUDs as of March 31, 2013 and 35,728 net acres. 

Haynesville Bossier; Cotton Valley and Other - 161.5 Bcfe (versus 160.5 Bcfe in December 31, 2012 SEC reserve report).

Total estimated proved reserves - 37.4 MMBOE (versus 35.6 MMBOE in December 31, 2012 SEC reserve report).

Proved reserves PV-10(1) - $248 million (versus $80.1 million in December 31, 2012 SEC reserve report).

(1) PV-10 represents the present value, discounted at 10% per annum, of estimated future net revenue before income tax of the Company's estimated proved reserves. The PV-10 value is different than the standardized measure of discounted estimated future net cash flows which is calculated after income taxes. The Company believes the PV-10 is a useful measure for evaluating the relative monetary significance of their proved reserves. Investors may use the PV-10 as a basis for comparison of the relative size and value of the Company's reserves to its peers. However, due to the Company's fully reserved net deferred tax assets, its standardized measure of discounted estimated net cash flows is the same as its PV-10.

Additional information regarding GMXR's Chapter 11 proceedings can be found at http://dm.epiq11.com/GMX or by calling 877-854-0023 (within U.S.) or +1-503-597-7711 (outside U.S.).

This press release includes certain statements that may be deemed to be "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that GMXR expects, believes or anticipates will or may occur in the future are forward-looking statements. They include statements regarding the Company's properties and resource potential. These statements are based on certain assumptions and analysis made by GMXR in light of its experience and perception of historical trends, current conditions, expected future developments, and other factors it believes appropriate in the circumstances, including the assumption that there will be no material change in the operating environment for GMXR's properties. Such statements are subject to a number of risks, including but not limited to risks relating to the Company's Chapter 11 bankruptcy filing, its ability to obtain financing for activities, the disposition of its assets and liabilities, commodity price risks, drilling and production risks, risks related to weather and unforeseen events, governmental regulatory risks and other risks, many of which are beyond the control of GMXR. Reference is made to GMXR's reports filed with the Securities and Exchange Commission for a more detailed disclosure of the risks. For all these reasons, actual results or developments may differ materially from those projected in the forward-looking statements.

CONTACT: Jennifer E. Mercer
         Epiq Strategic Communications for GMX Resources
         310-712-6215
         jmercer@epiqsystems.com