-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DdBGaBVRCbacIaUTRczOk7zOe982fAF6NrUHuvkTbk0dJ6BArXFUsxOWKauJHN3b tJTvnLjz6eTWQ9zbKXdZlg== 0001343719-08-000017.txt : 20080501 0001343719-08-000017.hdr.sgml : 20080501 20080501104657 ACCESSION NUMBER: 0001343719-08-000017 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20080430 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20080501 DATE AS OF CHANGE: 20080501 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ENERGY XXI (BERMUDA) LTD CENTRAL INDEX KEY: 0001343719 STANDARD INDUSTRIAL CLASSIFICATION: OIL AND GAS FIELD EXPLORATION SERVICES [1382] IRS NUMBER: 000000000 STATE OF INCORPORATION: D0 FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-33628 FILM NUMBER: 08792901 BUSINESS ADDRESS: STREET 1: CANONS COURT STREET 2: 22 VICTORIA STREET PO BX HM 1179 CITY: HAMILTON STATE: D0 ZIP: 00000 BUSINESS PHONE: 713 351 3003 MAIL ADDRESS: STREET 1: CANONS COURT STREET 2: 22 VICTORIA STREET PO BX HM 1179 CITY: HAMILTON STATE: D0 ZIP: 00000 FORMER COMPANY: FORMER CONFORMED NAME: ENERGY XXI ACQUISITION CORP BERMUDA LTD DATE OF NAME CHANGE: 20051107 8-K 1 form8_k.htm EXXI FORM 8-K EARNINGS RELEASE form8_k.htm
 



 

 
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): April 30, 2008
 
Energy XXI (Bermuda) Limited
 
 
(Exact name of registrant as specified in its charter)
 
 
000-52281
 
 
(Commission File Number)
 
Bermuda
98-0499286
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
   
Canon’s Court, 22 Victoria Street, PO Box HM
 
1179, Hamilton HM EX, Bermuda
Not Applicable
(Address of principal executive offices)
(Zip Code)
 
Registrant's telephone number, including area code: 441-295-2244
 
 
Check the appropriate below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
___
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
___
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
___
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2 (b))
   
___
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c))
   


 
 

 


 
Item 2.02.  Results of Operations and Financial Condition
 
On April 30, 2008, Energy XXI (Bermuda) Limited (the "Company"), issued a press release regarding the results of its operations and financial condition for the third quarter ended March 31, 2008.  A copy of the press release is attached hereto as Exhibit 99.1, is incorporated by reference, and is hereby furnished.
 
Item 9.01.  Financial Statements and Exhibits.
 
 
(d) Exhibits.
 
EXHIBIT NO.
 
ITEM
     
99.1
 
Press Release issued April 30, 2008



 
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SIGNATURES
 
 
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 hereunto duly authorized.
 
 
  
 
             
   
Energy XXI (Bermuda) Limited
             
 
Dated May 1, 2008
 
 
By
 
 
 /s/ David West Griffin
 
   
       
Name: David West Griffin
   
       
Title: Chief Financial Officer
   
 

 

 
- 3 - -

 

 
Exhibit Index
 
EXHIBIT NO.
 
ITEM
     
99.1
 
Press Release issued April 30, 2008
 


 

 
- 4 - -

 
EX-99.1 2 ex99_1.htm PRESS RELEASE ex99_1.htm
 


Exhibit 99.1
Energy XXI Reports Fiscal Third-Quarter Results
 
·  
Volumes rise 80% from prior-year third quarter
·  
Revenues and EBITDA more than double to new record highs
·  
Exploration program accelerates and logs success

HOUSTON – April 30, 2008 – Energy XXI (Bermuda) Limited (NASDAQ: EXXI) (AIM: EXXI, EXXS) today announced fiscal third-quarter financial and operating results for the period ended March 31, 2008.
“Our fiscal third-quarter operating results reflect the continued success of our acquire-and-exploit strategy,” Energy XXI Chairman and CEO John Schiller said.  “Energy XXI remains on track to deliver a solid performance from our core producing properties during our 2008 fiscal year ending June 30, with the potential to significantly boost reserves through high-impact exploration.”
For the 2008 fiscal third quarter, revenues were $167.1 million and earnings before interest, taxes, depreciation, depletion and amortization (EBITDA) totaled $117.5 million, more than double the 2007 fiscal third-quarter revenues of $77.6 million and EBITDA of $54.5 million.  Net income was $10.3 million, or $0.12 per diluted share, which included a loss of $2.7 million, or $0.03 per diluted share, for non-cash mark-to-market charges on open oil and gas derivative contracts.  In the 2007 fiscal third quarter, net income was $9.6 million, or $0.11 per diluted share, which included a mark-to-market gain of $1.6 million, or $0.02 per diluted share, for open oil and gas derivative contracts.
Net cash provided by operating activities totaled $112.5 million for the 2008 fiscal third quarter, compared with $76.2 million in the 2007 fiscal third quarter.  Discretionary cash flow was $96.2 million in the 2008 fiscal third quarter, compared with $47.5 million in the 2007 fiscal third quarter.
For the 2008 fiscal third quarter, sales volumes averaged 26,100 barrels of oil equivalent per day (BOE/d), compared with 14,500 BOE/d in the 2007 fiscal third quarter.  The net realized price received for the company’s production in the 2008 fiscal third quarter averaged $70.33 per BOE, including an $8.92 per BOE reduction due to hedging, compared with a net realized price of $59.54 per BOE, including a $7.95 per BOE contribution from hedging, in the 2007 fiscal third quarter.

Capital Expenditures
During the 2008 fiscal third quarter, capital expenditures totaled $62.8 million.  The fiscal-year 2008 capital budget, excluding acquisitions, is expected to approximate $300 million, which reflects about $40 million of added spending primarily associated with incremental exploration activity and development costs associated with successful exploration.


 
- 1 - -

 


3rd Quarter Operational Highlights
During the fiscal third quarter, Energy XXI continued to implement its exploration and development program, details of which are provided in the attached Operations Report.
“The last few months have been encouraging for us from an operations standpoint,” Energy XXI President and Chief Operating Officer Steve Weyel said.  “We initiated drilling and recompletion work at the Main Pass properties acquired last June, with good results that should positively impact our fourth quarter.  We drilled a discovery at our Lake Salvador project onshore Louisiana, helping validate the extensive pre-drill work we have done in the area.  We side-tracked and resumed drilling at the high-potential Cote de Mer prospect.  More recently, we gained access to 425,000 gross acres across the ultra-deep prospect trend on the shallow-water Gulf of Mexico shelf, including the re-entry of the Blackbeard West wellbore. While production volumes continued to be frustrated by infrastructure outages during the quarter, our operated properties have performed ahead of our expectations.”

Conference Call Tomorrow at 9 a.m. CDT, 3 p.m. London Time
Energy XXI will host its third-quarter conference call tomorrow, Thursday, May 1, 2008, at 9 a.m. CDT (3 p.m. London time). The dial-in number is 1 (913) 312-0715 in the U.S. and 08081 011 402 in the U.K., and the confirmation code is 4499493. For complete instructions on how to actively participate in the conference call, or to listen to the live audio webcast or a replay, please refer to www.energyxxi.com.

Forward-Looking Statements
All statements included in this release relating to future plans, projects, events or conditions and all other statements other than statements of historical fact included in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based upon current expectations and are subject to a number of risks, uncertainties and assumptions, including changes in long-term oil and gas prices or other market conditions affecting the oil and gas industry, reservoir performance, the outcome of commercial negotiations and changes in technical or operating conditions, among others, that could cause actual results, including project plans and related expenditures and resource recoveries, to differ materially from those described in the forward-looking statements. Energy XXI assumes no obligation and expressly disclaims any duty to update the information contained herein except as required by law.

Competent Person Disclosure
The technical information contained in this announcement relating to operations (including information in the attached Operations Report) adheres to the standard set by the Society of Petroleum Engineers.  Tom O’Donnell, Vice President of Corporate Development, a registered Petroleum Engineer, is the qualified person who has reviewed and approved the technical information contained in this announcement.

About the Company
Energy XXI is an independent oil and natural gas exploration and production company whose growth strategy emphasizes acquisitions, enhanced by its value-added organic drilling program. The company’s properties are primarily located in the U.S. Gulf of Mexico waters and the Gulf Coast onshore. Collins Stewart Europe Limited and Tristone Capital Limited are Energy XXI listing brokers in the United Kingdom.  In the United States, BMO Capital Markets, Collins Stewart, Dahlman Rose & Co., Jefferies & Company, Natixis Bleichroeder and Sterne Agee & Leach, Inc. are market makers. To learn more, visit the Energy XXI website at www.energyxxi.com.

 
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ENERGY XXI (BERMUDA) LIMITED
CONSOLIDATED BALANCE SHEETS
(In Thousands, except share information)

   
March 31,
   
June 30,
 
   
2008
   
2007
 
   
(Unaudited)
       
ASSETS
           
Current Assets
           
Cash and cash equivalents
  $ 3,066     $ 19,784  
Accounts receivable
               
Oil and natural gas sales
    95,613       55,763  
Joint interest billings
    25,488       14,377  
Insurance and other
    2,548       958  
Prepaid expenses and other current assets
    17,691       21,870  
Deferred income taxes
    30,258        
Royalty deposits
    4,548       2,175  
Derivative financial instruments
          17,131  
Total Current Assets
    179,212       132,058  
Property and Equipment, net of accumulated depreciation, depletion, and amortization
               
Oil and natural gas properties - full cost method of accounting
    1,529,845       1,491,685  
Other property and equipment
    8,494       3,097  
Total Property and Equipment
    1,538,339       1,494,782  
Other Assets
               
Debt issuance costs, net of accumulated amortization
    17,973       20,986  
Deferred income taxes
    2,724        
Derivative financial instruments
          616  
Total Other Assets
    20,697       21,602  
Total Assets
  $ 1,738,248     $ 1,648,442  

LIABILITIES
           
Current Liabilities
           
Accounts payable
  $ 68,592     $ 79,563  
Advances from joint interest partners
    5,053       2,026  
Accrued liabilities
    57,469       33,459  
Deferred income taxes
          1,044  
Derivative financial instruments
    95,268       1,480  
Note payable
    3,323        
Current maturities of long-term debt
    4,188       5,508  
Total current liabilities
    233,893       123,080  
Long-term debt, less current maturities
    1,066,377       1,045,511  
Deferred income taxes
          14,788  
Asset retirement obligations
    64,304       63,364  
Derivative financial instruments
    68,435       4,573  
Total Liabilities
    1,433,009       1,251,316  
Commitments and Contingencies
               
Stockholders’ Equity
               
Preferred stock, $0.01 par value, 2,500,000 shares authorized and no shares issued at March 31, 2008 and June 30, 2007
           
Common stock, $0.001 par value, 400,000,000 shares authorized and 84,511,906 and 84,203,444 issued and outstanding at March 31, 2008 and June 30, 2007, respectively
    84       84  
Additional paid-in capital
    363,285       363,206  
Retained earnings
    49,721       31,072  
Accumulated other comprehensive income (loss), net of tax
    (107,851 )     2,764  
Total Stockholders’ Equity
    305,239       397,126  
Total Liabilities and Stockholders’ Equity
  $ 1,738,248     $ 1,648,442  


 
- 3 - -

 




ENERGY XXI (BERMUDA) LIMITED
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, except per share information)
(Unaudited)

   
Three Months Ended
   
Nine Months Ended
 
   
March 31,
   
March 31,
 
   
2008
   
2007
   
2008
   
2007
 
                         
Revenues
                       
Oil sales
  $ 103,627     $ 42,777     $ 284,522     $ 121,882  
Natural gas sales
    63,510       34,831       179,948       100,686  
Total Revenues
    167,137       77,608       464,470       222,568  
                                 
Costs and Expenses
                               
Lease operating expense
    38,342       16,351       103,078       43,819  
Production taxes
    1,755       1,691       4,987       2,909  
Depreciation, depletion and amortization
    75,268       28,600       223,927       88,055  
Accretion of asset retirement obligation
    1,911       877       5,660       2,619  
General and administrative expense
    4,912       5,733       16,327       16,324  
Loss (gain) on derivative financial instruments
    2,700       (1,552 )     2,656       (3,110 )
Total Costs and Expenses
    124,888       51,700       356,635       150,616  
                                 
Operating Income
    42,249       25,908       107,835       71,952  
                                 
Other Income (Expense)
                               
Interest income
    348       307       1,249       1,599  
Interest expense
    (26,058 )     (12,646 )     (79,688 )     (39,653 )
Total Other Income (Expense)
    (25,710 )     (12,339 )     (78,439 )     (38,054 )
                                 
Income Before Income Taxes
    16,539       13,569       29,396       33,898  
                                 
Provision for Income Taxes
    6,252       3,988       10,747       11,976  
                                 
Net Income
  $ 10,287     $ 9,581     $ 18,649     $ 21,922  
                                 
Earnings Per Share
                               
Basic
  $ 0.12     $ 0.11     $ 0.22     $ 0.26  
Diluted
  $ 0.12     $ 0.11     $ 0.22     $ 0.26  
                                 
Weighted Average Number of Common Shares Outstanding
                               
Basic
    84,141       84,049       84,139       83,893  
Diluted
    84,141       84,049       85,259       83,893  


 
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ENERGY XXI (BERMUDA) LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)

   
Three Months Ended
   
Nine Months Ended
 
   
March 31,
   
March 31,
 
   
2008
   
2007
   
2008
   
2007
 
                         
Cash Flows From Operating Activities
                       
Net income
  $ 10,287     $ 9,581     $ 18,649     $ 21,922  
Adjustments to reconcile net income to net cash  provided by (used in) operating activities:
                               
Deferred income tax expense
    6,252       3,988       10,747       11,976  
Change in derivative financial instruments
    1,319       4,114       811       10,505  
Accretion of asset retirement obligations
    1,911       877       5,660       2,619  
Depletion, depreciation, and amortization
    75,268       28,600       223,927       88,055  
Amortization and write-off of debt issuance costs
    1,114       325       3,688       5,998  
Common stock issued to Directors for services
                67        
Changes in operating assets and liabilities
                               
Accounts receivable
    (14,247 )     28,769       (48,142 )     35,807  
Prepaid expenses and other current assets
    20,676       (13,334 )     1,806       (39,501 )
Accounts payable and other liabilities
    9,901       13,326       20,122       21,385  
Net Cash Provided by Operating Activities
    112,481       76,246       237,335       158,766  
                                 
                                 
Cash Flows from Investing Activities
                               
Acquisitions
    (8,569 )           (38,935 )     (302,481 )
Capital expenditures
    (62,784 )     (130,587 )     (234,002 )     (250,951 )
Proceeds from the sale of oil and natural gas properties
                      1,400  
Other
    (102 )     573       (135 )     1,333  
Net Cash Used in Investing Activities
    (71,455 )     (130,014 )     (273,072 )     (550,699 )
                                 
Cash Flows from Financing Activities
                               
Proceeds from the issuance of common stock - net
          108       32       13,167  
Proceeds from long-term debt
    21,000       65,000       204,135       364,000  
Payments on long-term debt
    (69,024 )     (10,000 )     (180,159 )     (24,625 )
Payments on put financing
    (1,419 )     (2,011 )     (4,294 )     (7,030 )
Debt issuance costs
                (675 )     (4,754 )
Other
    (17 )     (407 )     (20 )     (1,037 )
Net Cash Provided by (Used in) Financing Activities
    (49,460 )     52,690       19,019       339,721  
                                 
Net Increase (Decrease) in Cash and Cash Equivalents
    (8,434 )     (1,078 )     (16,718 )     (52,212 )
                                 
Cash and Cash Equivalents, beginning of period
    11,500       11,255       19,784       62,389  
                                 
Cash and Cash Equivalents, end of period
  $ 3,066     $ 10,177     $ 3,066     $ 10,177  




 
- 5 - -

 


ENERGY XXI (BERMUDA) LIMITED
CONSOLIDATED OPERATING RESULTS
(In Thousands, except per unit amounts)(Unaudited)
             
   
Quarter Ended
       
   
 
Mar. 31, 2007
   
June 30, 2007
   
Sept. 30,  2007
   
Dec. 31, 2007
   
Mar. 31, 2008
       
   
Twelve Months Ended
Mar. 31, 2008
 
                                     
Operating Revenues
  $ 77,608     $ 118,716     $ 143,608     $ 153,725     $ 167,137     $ 583,186  
                                                 
Operating Expenses
                                               
Lease operating expense
                                               
Insurance expense
    4,866       2,489       4,832       4,812       4,642       16,775  
Workover and maintenance
    1,910       5,532       5,720       4,489       5,447       21,188  
    Direct lease operating expense
    9,575       17,145       20,141       24,742       28,253       90,281  
  Total lease operating expense
    16,351       25,166       30,693       34,043       38,342       128,244  
Production taxes
    1,691       686       1,960       1,272       1,755       5,673  
DD&A
    28,600       57,873       73,253       75,406       75,268       281,800  
General and administrative
    5,733       10,183       5,771       5,644       4,912       26,510  
Other – net
    (675 )     1,545       2,802       903       4,611       9,861  
Total operating expenses
    51,700       95,453       114,479       117,268       124,888       452,088  
Operating Income
  $ 25,908     $ 23,263     $ 29,129     $ 36,457     $ 42,249     $ 131,098  
                                                 
Sales Volumes per Day
                                               
   Natural gas (MMcf)
    42.1       60.0       83.5       78.1       73.3       73.7  
   Crude oil (MBbls)
    7.5       10.9       12.3       13.0       13.9       12.5  
      Total (MBOE)
    14.5       20.9       26.2       26.0       26.1       24.8  
                                                 
Average Sales Price
                                               
    Natural gas per Mcf
  $ 7.77     $ 7.78     $ 5.83     $ 7.48     $ 9.25     $ 7.51  
    Hedge gain per Mcf
    1.43       0.80       1.46       0.93       0.28       0.89  
        Total natural gas per Mcf
  $ 9.20     $ 8.58     $ 7.29     $ 8.41     $ 9.53     $ 8.40  
                                                 
    Crude oil per Bbl
  $ 56.24     $ 67.46     $ 79.19     $ 90.71     $ 100.10     $ 85.44  
    Hedge gain (loss) per Bbl
    7.36       5.21       (1.52 )     (12.68 )     (18.20 )     (7.59 )
        Total crude oil per Bbl
  $ 63.60     $ 72.67     $ 77.67     $ 78.03     $ 81.90     $ 77.85  
                                                 
    Hedge gain (loss) per BOE
  $ 7.95     $ 5.03     $ 3.94     $ (3.56 )   $ (8.92 )     (1.18 )
                                                 
 Operating Revenues per BOE
  $ 59.54     $ 62.53     $ 59.63     $ 64.24     $ 70.33     $ 64.25  
                                                 
Operating Expenses per BOE
                                               
Lease operating expense
                                               
Insurance expense
    3.73       1.31       2.00       2.01       1.95       1.85  
Workover and maintenance
    1.47       2.91       2.38       1.88       2.29       2.33  
    Direct lease operating expense
    7.34       9.03       8.36       10.34       11.89       9.95  
  Total lease operating expense
    12.54       13.25       12.74       14.23       16.13       14.13  
Production taxes
    1.30       0.36       0.81       0.53       0.74       0.63  
DD&A
    21.94       30.48       30.42       31.51       31.67       31.05  
General and administrative
    4.40       5.37       2.40       2.36       2.07       2.92  
Other – net
    (0.52 )     0.82       1.16       0.38       1.94       1.08  
Total operating expenses
    39.66       50.28       47.53       49.01       52.55       49.81  
Operating Income per BOE
  $ 19.88     $ 12.25     $ 12.10     $ 15.23     $ 17.78     $ 14.44  


 
- 6 - -

 



ENERGY XXI (BERMUDA) LIMITED
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(In Thousands, except per share information)
(Unaudited)


As required under Regulation G of the Securities Exchange Act of 1934, provided below are reconciliations of net income to the following non-GAAP financial measures: EBITDA and discretionary cash flow.  The company uses these non-GAAP measures as key metrics for the management of the company and to demonstrate the company’s ability to internally fund capital expenditures and service debt.  The non-GAAP measures are useful in comparisons of oil and gas exploration and production companies as they exclude non-operating fluctuations in assets and liabilities.


   
Three Months Ended
   
Nine Months Ended
 
   
March 31,
   
March 31,
 
   
2008
   
2007
   
2008
   
2007
 
                         
Net Income as Reported
  $ 10,287     $ 9,581     $ 18,649     $ 21,922  
                                 
   Total other (income) expense
    25,710       12,339       78,439       38,054  
   Depreciation, depletion and amortization
    75,268       28,600       223,927       88,055  
   Provision for income taxes
    6,252       3,988       10,747       11,976  
                                 
EBITDA
  $ 117,517     $ 54,508     $ 331,762     $ 160,007  
                                 
EBITDA Per Share
                               
Basic
  $ 1.40     $ 0.65     $ 3.94     $ 1.91  
Diluted
  $ 1.40     $ 0.65     $ 3.89     $ 1.91  
                                 
Weighted Average Number of Common Shares Outstanding
                               
Basic
    84,141       84,049       84,139       83,893  
Diluted
    84,141       84,049       85,259       83,893  
                                 
                                 
                                 
                                 
Net Income as Reported
  $ 10,287     $ 9,581     $ 18,649     $ 21,922  
                                 
   Deferred income tax expense
    6,252       3,988       10,747       11,976  
   Change in derivative financial instruments
    1,319       4,114       811       10,505  
   Accretion of asset retirement obligations
    1,911       877       5,660       2,619  
   Depletion, depreciation, and amortization
    75,268       28,600       223,927       88,055  
   Amortization and write-off of debt issuance costs
    1,114       325       3,688       5,998  
   Common stock issued to Directors for services
                67        
                                 
Discretionary Cash Flow
  $ 96,151     $ 47,485     $ 263,549     $ 141,075  



 
- 7 - -

 


ENERGY XXI (BERMUDA) LIMITED
SUMMARY OF HEDGE POSITIONS AS OF APRIL 30, 2008

Natural Gas (000 MMBTU)
   
Crude Oil (000 BBL)
 
                                                             
             
Average
                 
Average
 
Qtr
 
Instrument
 
Volume
   
Sub
   
Floor
   
Cap
   
Qtr
 
Instrument
 
Volume
   
Sub
   
Floor
   
Cap
 
                                                             
  Q408  
Swaps
    1,150             8.86       8.86       Q408  
Swaps
    217             79.66       79.66  
     
3 Way Collars
    460       5.67       7.41       10.10          
3 Way Collars
    66       54.09       67.21       78.61  
     
Collars
    264               7.96       10.49          
Collars
    60               65.47       76.36  
     
Puts
    40               8.00                  
Puts
    10               60.00          
     
Put Spreads
    450       6.00       8.00                                                    
                                                                                 
  Q109  
Swaps
    3,020               8.90       8.90       Q109  
Swaps
    676               82.60       82.60  
     
3 Way Collars
    1,340       5.66       7.38       10.11          
3 Way Collars
    205       54.12       67.44       78.99  
     
Collars
    744               7.97       10.46          
Collars
    55               60.00       78.00  
     
Puts
    120               8.00                  
Puts
    27               60.00          
     
Put Spreads
    1,280       6.00       8.00                                                    
                                                                                 
  Q209  
Swaps
    2,450               8.82       8.82       Q209  
Swaps
    472               78.88       78.88  
     
3 Way Collars
    1,250       5.63       7.34       10.12          
3 Way Collars
    184       54.02       67.40       79.09  
     
Collars
    685               7.97       10.43          
Collars
    162               70.28       96.67  
     
Puts
    110               8.00                  
Puts
    26               60.00          
     
Put Spreads
    1,170       6.00       8.00                                                    
                                                                                 
  Q309  
Swaps
    2,080               8.46       8.46       Q309  
Swaps
    325               70.85       70.85  
     
3 Way Collars
    1,040       6.00       8.09       9.97          
3 Way Collars
    170       53.94       67.24       78.94  
     
Collars
    302               7.72       9.96          
Collars
    233               76.74       107.25  
                                                                                 
  Q409  
Swaps
    1,830               8.46       8.46       Q409  
Swaps
    303               70.86       70.86  
     
3 Way Collars
    930       6.00       8.10       9.96          
3 Way Collars
    137       53.69       67.37       79.66  
     
Collars
    289               7.73       9.91          
Collars
    220               76.67       107.17  
                                                                                 
  Q110  
Swaps
    1,770               8.47       8.47       Q110  
Swaps
    277               70.97       70.97  
     
3 Way Collars
    820       6.00       8.11       9.96          
3 Way Collars
    111       53.38       67.52       80.49  
     
Collars
    137               8.00       8.85          
Collars
    211               76.58       107.07  
                                                                                 
  Q210  
Swaps
    1,580               8.47       8.47       Q210  
Swaps
    257               71.01       71.01  
     
3 Way Collars
    740       6.00       8.12       9.95          
3 Way Collars
    87       52.93       67.70       81.64  
     
Collars
    137               8.00       8.85          
Collars
    201               76.51       106.99  
                                                                                 
  Q310  
Swaps
    1,700               8.12       8.12       Q310  
Swaps
    238               70.86       70.86  
     
3 Way Collars
    490       6.00       8.12       9.95          
3 Way Collars
    68       52.35       67.35       82.05  
                                               
Collars
    190               76.53       104.76  
                                                                                 
  Q410  
Swaps
    1,500               8.12       8.12       Q410  
Swaps
    215               70.89       70.89  
     
3 Way Collars
    460       6.00       8.20       9.92          
3 Way Collars
    60       52.00       67.00       82.04  
                                               
Collars
    174               76.49       104.68  
                                                                                 
  Q111  
Swaps
    1,380               8.12       8.12       Q111  
Swaps
    193               70.93       70.93  
     
3 Way Collars
    440       6.00       8.20       9.92          
3 Way Collars
    52       51.54       66.54       82.03  
                                               
Collars
    156               76.48       104.66  
                                                                                 
  Q211  
Swaps
    1,280               8.12       8.12       Q211  
Swaps
    171               70.96       70.96  
     
3 Way Collars
    420       6.00       8.21       9.91          
3 Way Collars
    45       50.95       65.95       82.02  
                                               
Collars
    146               76.50       104.69  

Includes production for June 2008 and later; Quarters based on June 30 fiscal year-end
All prices are weight-averaged by contract volume

 
- 8 - -

 


FY 2008 3rd Quarter Operations Report

EXXI Fiscal 3rd Quarter 2008 Drilling Results
 
 
Exploration
Development
Total
 
Gross
Net
Gross
Net
Gross
Net
Operated
           
Oil
0
0
1
1
1
1
Gas
0
0
0
0
0
0
Dry
0
0
0
0
0
0
Non-Operated
           
Oil
0
0
0
0
0
0
Gas
2
0.85
0
0
2
0.85
Dry
2
0.64
0
0
2
0.64
Total
4
1.49
1
1
5
2.49
             
 
Exploration
Development
Total
Success Rates
50%
57%
100%
100%
60%
74%
             
 
Exploration
Development
Total
Onshore
4
0
1
Offshore
0
1
4
Total
4
1
5


Gulf Of Mexico Shelf Highlights

South Timbalier 21 (100% WI)
South Timbalier 21 net production averaged 8,549 BOE/d during the fiscal third quarter, an increase of almost 1,400 BOE/d net from the previous quarter.  
After working through minor facility obstacles, the Beaujolais (ST 21 #138) well’s production was stabilized by mid-February and production has been averaging 1,700 BOE/d net from the D-15 and D-18 sands.
The Sangria (ST 27 #D-13ST2) development well commenced production during February at a peak rate of 1,200 BOE/d net from the D-7 Stray sand.
The #135 well was recompleted through tubing to the D-10 sand during February and initially produced at a rate of 490 BOE/d net.
The #75ST well was recompleted through tubing to the S-4A sand during January and initially produced at a rate of 570 BOE/d net.
The Cabernet (#89 ST) well was recently reworked to restore production from the lower D-7 sand.  The initial net rate was 334 BOE/d.

Acquired Pogo Properties
The Gulf of Mexico shelf properties acquired in June 2007 from Pogo Producing Company averaged 9,598 BOE/d net during the fiscal third quarter. After completing MMS compliance work and getting the properties released from MMS probation in the previous quarter, the first rig program was initiated in the third quarter, along with some non-rig workovers.  Activity in the field temporarily interrupted some production volumes.

 
- 9 - -

 


The Ensco 82 rig arrived at Main Pass 61-B in early February.  The recompletion of well #B-1 was successful, resulting in 600 BOE/d net of new production starting late March.  The #B-6 development well was spud in late March and is expected to come online in May.  Also in the fiscal third quarter, 550 BOE/d net was added at MP 73 as a result of a successful non-rig workover.
The Ensco 82 rig will move to the Main Pass 61-A platform in May to drill and complete the MP 60 #A-9 exploratory well and change out tubing in the MP 62 #A-4.  This rig is then expected to spud the Main Pass 147 #1 development well near the end of June.  Two additional rigs are expected to arrive in May and June to begin well work at MP 61-C and MP 126.
           In Lease Sale 206, Energy XXI was high bidder on five blocks adjacent to the South Pass 49 field.  Following facility upgrades, including replacement of separation and compression units, gas lift optimization and acid stimulations on four D-69/D-70 sand wells are planned for South Pass 49.

South Louisiana Onshore Highlights

Eugene Island
·  
SL 17695 #1 (35% WI) (Comus Prospect), Iberia Parish – spud 12/22/07 with a proposed TD of 13,800’; primary objective wet; secondary target zone, the Cris I sand, deemed commercial; awaiting completion rig.

Cote de Mer
·  
McIlhenny #1 (35% WI) (Cote de Mer Prospect), Vermillion Parish – Coastal rig 21 arrived March 13th; sidetracked at approximately 13,000’; preparing to run casing to 15,685’ MD; proposed TD is 21,000’.

Kaplan NW
·  
Green & Broussard #1 (100% WI) (Kaplan Prospect), Vermillian Parish – Spud 3/28/08; drilling at about 6,300’ MD toward proposed TD of 18,500’.

Venus
·  
SL 19515 #1 (50% WI) (Venus Prospect), Cameron Parish – Spud 4/30/08; beginning to drill toward proposed TD of 16,000’.

 
- 10 - -

 



Enquiries of the Company

Energy XXI (Bermuda) Limited
Stewart Lawrence
Vice President, Investor Relations and Communications
+1 713-351-3006
slawrence@energyxxi.com