WPX Energy Makes Discovery in Niobrara Formation

  WPX Energy Makes Discovery in Niobrara Formation

                  Results Build Upon Previous Mancos Success

Business Wire

TULSA, Okla. -- January 22, 2013

WPX Energy’s (NYSE:WPX) successful Niobrara shale discovery in western
Colorado has the potential to significantly increase the company’s natural gas
reserves and daily production in ensuing years.

The discovery well produced an initial high of 16 million cubic feet per day
at a flowing pressure of 7,300 pounds per square inch.

The well has since been choked back substantially to optimize reservoir
performance and ensure maximum resource recovery. Over the past 30 days, it
produced at an average rate of 12 million cubic feet per day.

WPX has the lease rights to approximately 180,000 net acres of the
Niobrara/Mancos shale play that underlies the company’s expansive leasehold
position in the Piceance Basin.

Substantial gathering and processing infrastructure is in place to accommodate
additional gas volumes from the area, as is take-away capacity from the basin.
Gas produced from the Niobrara and Mancos shales can be processed without
modification to existing gas treatment facilities.

WPX has drilled more than 4,000 wells in the Piceance Basin, mostly in the
tight sandstones of the Williams Fork formation.

“We have a large-scale position in the Piceance, where we are the lowest-cost,
most efficient producer in the basin. We know the Piceance is a world-class
asset. Now the results of our Niobrara well are showing that our acreage has
even greater reserves potential,” said Ralph A. Hill, president and chief
executive officer.

“This exploratory work in the Niobrara and Mancos shales of the Piceance was a
logical follow-on to our previous Mancos shale discoveries in the San Juan
Basin.

“In the latter half of 2010, we drilled two horizontal discovery wells there
that produced at high rates from the same reservoir that we’re delineating in
the Piceance. The San Juan results already added 1.3 trillion cubic feet of
proved, probable and possible reserves to WPX,” Hill added.

“Based on the early indications from this Piceance discovery, we’re talking
about the potential to ultimately more than double our current 18 trillion
cubic feet equivalent of 3P reserves,” Hill said.

The Niobrara and Mancos shales are generally located at depths of 10,000 to
13,000 feet. The Williams Fork is a shallower formation, generally located at
depths of 6,000 to 9,000 feet. In the Piceance Basin, WPX holds an average
working interest of 66 percent in the Niobrara and Mancos shales.

WPX plans to drill at least two more horizontal Niobrara wells in the Piceance
Basin this year, pending permits, starting within a six-mile radius of the
first well. This additional work will help WPX evaluate how productive the
formation is across the basin. Other operators also are delineating the extent
of the resource on the eastern and western margins of the basin.

WPX’s first Niobrara horizontal well is located on the company’s existing
Piceance Valley acreage in Garfield County. It was drilled to a total vertical
depth of 10,200 feet with a 4,600-foot horizontal lateral.

Drilling operations commenced in August 2012 during which the company
successfully recovered 535 feet of continuous core. Completion operations,
including 17 frac stages, were completed in December.

WPX previously drilled a vertical Niobrara test well in late 2011 that yielded
the impetus for drilling the first horizontal well to gain additional data
about the productivity of the formation.

Steven G. Natali, senior vice president of exploration for WPX, commented, “As
we study what our geoscience and operations teams have achieved in the
Niobrara and Mancos shales, we’re seeing hydrocarbon saturation across
tremendous thickness in a highly over-pressurized environment. These shales
are located directly underneath our current Williams Fork production in the
Piceance.

“Advances in horizontal drilling and the way that our completions engineers
apply multi-stage fracture technology means that much of this gas can
eventually be brought to the surface at an economic rate,” Natali added.

About WPX Energy, Inc.

WPX Energy is an exploration and production company focused on developing its
significant oil and gas reserves, particularly in the liquids-rich Piceance
Basin, the Bakken and Three Forks oil shales and the Marcellus Shale. WPX also
has domestic operations in the San Juan and Powder River basins, as well as a
69 percent interest in Apco Oil and Gas International. Go to
http://www.wpxenergy.com/investors.aspx to join our e-mail list.

This press release includes “forward-looking statements” within the meaning of
the Private Securities Litigation Reform Act of 1995. All statements, other
than statements of historical facts, included in this press release that
address activities, events or developments that the company expects, believes
or anticipates will or may occur in the future are forward-looking statements.
Such statements are subject to a number of assumptions, risks and
uncertainties, many of which are beyond the control of the company. Statements
regarding future drilling and production are subject to all of the risks and
uncertainties normally incident to the exploration for and development and
production of oil and gas. These risks include, but are not limited to, the
volatility of oil, natural gas and NGL prices; uncertainties inherent in
estimating oil, natural gas and NGL reserves; drilling risks; environmental
risks; and political or regulatory changes. Investors are cautioned that any
such statements are not guarantees of future performance and that actual
results or developments may differ materially from those projected in the
forward-looking statements. The forward-looking statements in this press
release are made as of the date of this press release, even if subsequently
made available by WPX Energy on its website or otherwise. WPX Energy does not
undertake and expressly disclaims any obligation to update the forward-looking
statements as a result of new information, future events or otherwise.
Investors are urged to consider carefully the disclosure in our filings with
the Securities and Exchange Commission, available from us at WPX Energy, Attn:
Investor Relations, P.O. Box 21810, Tulsa, Okla., 74102, or from the SEC’s
website at www.sec.gov.

Additionally, the SEC requires oil and gas companies, in filings made with the
SEC, to disclose proved reserves, which are those quantities of oil and gas,
which, by analysis of geoscience and engineering data, can be estimated with
reasonable certainty to be economically producible – from a given date
forward, from known reservoirs, under existing economic conditions, operating
methods, and governmental regulations. The SEC permits the optional disclosure
of probable and possible reserves. From time to time, we elect to use
“probable” reserves and “possible” reserves, excluding their valuation. The
SEC defines “probable” reserves as “those additional reserves that are less
certain to be recovered than proved reserves but which, together with proved
reserves, are as likely as not to be recovered.” The SEC defines“possible”
reserves as “those additional reserves that are less certain to be recovered
than probable reserves.” The Company has applied these definitions in
estimating probable and possible reserves. Statements of reserves are only
estimates and may not correspond to the ultimate quantities of oil and gas
recovered. Any reserve estimates provided in this presentation that are not
specifically designated as being estimates of proved reserves may include
estimated reserves not necessarily calculated in accordance with, or
contemplated by, the SEC‘s reserves reporting guidelines. Investors are urged
to consider closely the disclosure in our SEC filings that may be accessed
through the SEC’s website at www.sec.gov.

The SEC’s rules prohibit us from filing resource estimates. Our resource
estimations include estimates of hydrocarbon quantities for (i) new areas for
which we do not have sufficient information to date to classify as proved,
probable or even possible reserves, (ii) other areas to take into account the
low level of certainty of recovery of the resources and (iii) uneconomic
proved, probable or possible reserves. Resource estimates do not take into
account the certainty of resource recovery and are therefore not indicative of
the expected future recovery and should not be relied upon. Resource estimates
might never be recovered and are contingent on exploration success, technical
improvements in drilling access, commerciality and other factors.

Contact:

WPX Energy, Inc.
Media Contact:
Kelly Swan, 539-573-4944
or
Investor Contact:
David Sullivan, 539-573-9360
 
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