Sanchez Energy Announces Second Quarter 2014 Production of 1,859 MBOE, an Increase of 164% Over the Second Quarter of 2013, and

  Sanchez Energy Announces Second Quarter 2014 Production of 1,859 MBOE, an
  Increase of 164% Over the Second Quarter of 2013, and Provides Operations
                                    Update

PR Newswire

HOUSTON, July 23, 2014

HOUSTON, July 23, 2014 /PRNewswire/ --Sanchez Energy Corporation (NYSE: SN)
("Sanchez Energy" or the "Company") today provided an update on its second
quarter 2014 production and operations.

Summary Highlights

  oEstimated second quarter 2014 production of approximately 1,859 MBOE
    (20,427 BOE/D), an increase of 164% compared to the same period a year ago
    and above the midpoint of the production guidance range of 19,000 to
    21,000 BOE/D
  oReported production volumes consisted of 73% oil, 14% NGLs, and 13%
    natural gas
  oProduction during the month of July has averaged approximately 36,000
    BOE/D with 43 gross wells in various stages of completion
  oThe Company reiterates third quarter 2014 production guidance of 37,000 to
    41,000 BOE/D
  oInitial six wells in the Five Mile Creek area of Marquis came online with
    initial 30 day average rates ranging from approximately 450 to 700 BOE/D,
    in line with expectations and de-risking the 10,000 net acre position with
    an average completed well cost of $7.0 million
  oClosed the Catarina acquisition on June 30, 2014 and full scale
    development is underway with one rig currently drilling and a dedicated
    frac spread undergoing completion operations on the initial set of 22
    wells drilled, cased, and awaiting completion

Tony Sanchez, III, President and Chief Executive Officer of Sanchez Energy,
said: "The second quarter of 2014 was a transformational quarter for the
Company as we announced and closed the Catarina acquisition, enabling the
Company to significantly increase its reserves and production. Our inventory
of potential drilling locations now stands at almost 3,000. We permanently
financed the Catarina acquisition and have fully funded our capital plans
through 2015 after issuing $850 million of senior notes and 5 million shares
of common stock."

Sanchez continued: "Integration and planning for the full scale development of
the Catarina assets is already underway with one rig currently drilling on the
western side of Catarina and a second rig expected to be deployed by the end
of August in the same area. A third rig is scheduled to start Lower Eagle Ford
appraisal drilling on the eastern side of the asset later in the third quarter
of this year. With the scale attained from the Catarina operations, we have
contracted a full time, dedicated frac spread that has recently begun
completing the first set of 22 wells which have already been drilled, cased,
and are awaiting completion on this asset. This dedicated frac spread, along
with the direct sourcing of chemicals and sand, represents the next level of
costs savings which we expect will drive comparable completion costs down by
another 20% to 30%."

Sanchez concluded: "We are continuing full scale development across all of our
Eagle Ford areas and have de-risked the 10,000 net acre Five Mile Creek area
of Marquis by bringing online six wells with initial 30 day average production
rates of approximately 450 to 700 BOE/D which, along with continued appraisal
work in the rest of Marquis and Cotulla, are steadily adding de-risked
inventory. We are currently drilling a Buda appraisal well in the Five Mile
Creek area and are preparing to spud two Upper Eagle Ford wells in the Sante
area."

Production Overview

Estimated total production for the second quarter of 2014 was approximately
1,859 MBOE (20,427 BOE/D), within our guidance range of 19,000 to 21,000
BOE/D. Our quarterly average production rate would have been approximately
20,600 BOE/D if we would not have been impacted by the unexpected third party
pipeline downtime in our Cotulla and Wycross areas. Crude oil represented 73%
of the total production stream, NGLs represented 14%, and natural gas
represented 13%. Going forward, we anticipate production growth to continue as
a result of our ongoing Eagle Ford development and appraisal work as well as
the addition of the Catarina asset which will impact third quarter volumes.
Across all assets, we have 43 gross wells drilled and waiting on completion
and 7 rigs running, resulting in a steady backlog of wells that will
contribute to our continued production growth and reserve additions. We
reiterate our third quarter 2014 production guidance range of 37,000 to 41,000
BOE/D.

                                  Three Months Ended June 30,
                                  2014      2013     % Change
Total Production Volumes
Oil (MBbls)                       1,356     541      151%
Natural Gas (MMcf)                1,445     470      208%
NGLs (MBbls)                      262       84       213%
Total Production Volumes (MBOE)   1,859     703      164%
Average Daily Production Volumes
Oil (Bbls/d)                      14,901    5,946    151%
Natural Gas (Mcf/d)               15,879    5,162    208%
NGLs (Bbls/d)                     2,879     920      213%
Total Production Volumes (BOE/D)  20,427    7,726    164%



Eagle Ford Operations Update

The Company continues to realize sustained costs savings and drilling
efficiencies as it currently has 6 gross (5 operated and 1 non-operated) rigs
running across its Eagle Ford positions. In addition to the rig currently
running in Catarina, we have contracted a new, modern rig which will be
deployed in Catarina by the end of August. Results of our step-out tests in
the Marquis and Cotulla areas have now confirmed additional high return
inventory in these areas. Six new wells in the Five Mile Creek area of Marquis
were brought online with initial 30 day average production rates of
approximately 450 to 700 BOE/D at an average cost of $7.0 million, de-risking
the 10,000 net acre position. We are also drilling our first Buda well, the
Crabb Ranch A #2, targeting the Buda formation across the Five Mile Creek area
and are now in final preparation for the drilling of two Upper Eagle Ford
appraisal wells in the third quarter in the Sante area, with plans for
additional Upper Eagle Ford appraisal wells in Fayette and Lavaca Counties in
the second half of the year. In the Wycross area of Cotulla, we completed four
wells in an appraisal area close to the salt dome designed to expand the
prospective area for future locations. Those wells were brought online during
the second quarter with average initial 30 day production rates of
approximately 500 BOE/D, confirming that we can expand our planned activity in
Wycross at favorable rates of return in an area originally thought to be too
complicated and risky around the salt dome. In the Talbutt area of northern
Cotulla, we successfully drilled an approximately 7,000' lateral and achieved
initial 30 day rates over 600 BOE/D, which is a significant improvement over
the 350 BOE/D results from initial wells drilled prior to our May 2013
acquisition. We are currently completing four Wycross wells with an additional
five Wycross wells waiting on completion.

The extensional drilling we have undertaken since the start of the year has
significantly increased our available inventory in the Lower Eagle Ford.
Success appraising the Upper Eagle Ford, Buda, and Austin Chalk would
significantly expand our resource base, increasing our total potential
locations to almost 3,000. During the second half of the year, we will also
begin the process of de-risking the Lower Eagle Ford on over 60,000 untested
and prospective acres in Catarina.

Tuscaloosa Marine Shale Operations Update

Our first TMS well, the Dry Fork East #2H, in Wilkinson County, Mississippi
was spud in late May and reached total depth earlier this month within the
planned time-frame. During clean out prior to running production casing, the
drill string parted due to defects in the drill pipe. We are now in the
process of sidetracking the lateral portion of the well and expect to have
casing run within two weeks. The lateral exhibited strong hydrocarbon shows
during drilling, confirming our expectation of a good well. The TMS rig will
run continuously throughout the year, allowing us to spud up to four gross
operated wells in addition to participating in 10 – 15 gross non-operated
wells. We increased our TMS net acreage position during the second quarter
from approximately 40,000 net acres to 58,000 net acres, largely through bolt
on acreage positions. We expect other TMS operators to continue ramping up
their activity and further de-risk various portions of the play.

As detailed in the table below, Sanchez Energy currently has 7 gross rigs (6
operated and 1 non-operated) running across its Eagle Ford and TMS areas with
413 gross producing wells and 43 gross wells in various stages of completion.

                                          Gross
             Gross      Gross    Net      Wells Waiting /
Project      Producing  Rigs     Rigs     Undergoing
Area         Wells      Running  Running  Completion
Catarina     176        1        1        22
Marquis      59         4        3        11
Cotulla      114        1        1        10
Palmetto     61         -        -        -
TMS / Other  3          1        1        -
Total        413        7        6        43

About Sanchez Energy Corporation

Sanchez Energy Corporation is an independent exploration and production
company focused on the acquisition and development of unconventional resources
in the onshore U.S. Gulf Coast with a current focus on the Eagle Ford Shale
where we have assembled approximately 224,000 net acres. The Company also has
approximately 58,000 net acres targeting the Tuscaloosa Marine Shale. Sanchez
Energy plans to hold its second quarter 2014 earnings conference call on
Thursday, August 7, 2014 at 2:00 p.m. EDT (1:00 p.m. CDT). For more
information about Sanchez Energy Corporation, please visit our website:
www.sanchezenergycorp.com

Forward Looking Statements

This press release contains, and our officers and representatives may from
time to time make, 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. All statements, other than statements of historical facts,
included in this press release that address activities, events or developments
that Sanchez Energy expects, believes or anticipates will or may occur in the
future are forward-looking statements, including statements relating to the
anticipated benefits of our acquisitions. These statements are based on
certain assumptions made by the company based on management's experience,
perception of historical trends and technical analyses, current conditions,
anticipated future developments and other factors believed to be appropriate
and reasonable by management. When used in this press release, the words
"will," "potential," "believe," "estimate," "intend," "expect," "may,"
"should," "anticipate," "could," "plan," "predict," "project," "profile,"
"model," or their negatives, other similar expressions or the statements that
include those words, are intended to identify forward-looking statements,
although not all forward-looking statements contain such identifying words.

Such statements are subject to a number of assumptions, risks and
uncertainties, many of which are beyond the control of Sanchez Energy, which
may cause actual results to differ materially from those implied or expressed
by the forward-looking statements, including, but not limited to failure of
acquired assets to produce as anticipated, failure to successfully integrate
acquired assets, failure to continue to produce oil and gas at historical
rates, costs of operations, delays, and any other difficulties related to
producing oil or gas, the price of oil or gas, marketing and sales of produced
oil and gas, estimates made in evaluating reserves, competition, general
economic conditions and the ability to manage and continue growth and other
factors described in Sanchez Energy's Annual Report for the fiscal year ended
December 31, 2013 and any updates to those risk factors set forth in Sanchez
Energy's Quarterly Reports on Form 10-Q. Further information on such
assumptions, risks and uncertainties is available in Sanchez Energy's filings
with the Securities and Exchange Commission ("SEC"). Sanchez Energy's filings
with the SEC are available on its website at www.sanchezenergycorp.com and on
the SEC's website at www.sec.gov. In light of these risks, uncertainties and
assumptions, the events anticipated by Sanchez Energy's forward-looking
statements may not occur, and, if any of such events do occur, Sanchez Energy
may not have correctly anticipated the timing of their occurrence or the
extent of their impact on its actual results. Accordingly, you should not
place any undue reliance on any of Sanchez Energy's forward-looking
statements. Any forward-looking statement speaks only as of the date on which
such statement is made and Sanchez Energy undertakes no obligation to correct
or update any forward-looking statement, whether as a result of new
information, future events or otherwise, except as required by applicable law.

Cautionary Note to U.S. Investors

The SEC permits oil and gas companies, in their filings with the SEC, to
disclose only proved, probable and possible reserves. We may use certain terms
in our press releases, such as net resource potential and other variations of
the foregoing terms that the SEC's guidelines strictly prohibit us from
including in filings with the SEC. U.S. Investors are urged to consider
closely the reserves disclosures in our filings with the SEC available on our
website at www.sanchezenergycorp.comand the SEC's website at www.sec.gov. You
can also obtain this information from the SEC by calling its general
information line at 1-800-SEC-0330.

Company contact:

Michael G. Long
Executive Vice President and Chief Financial Officer
Sanchez Energy Corporation
(713) 783-8000

Gleeson Van Riet
SVP, Capital Markets & Investor Relations
Sanchez Energy Corporation
(713) 783-8000



SOURCE Sanchez Energy Corporation

Website: http://www.sanchezenergycorp.com
 
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