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PDC Energy focuses its exploration, development and production efforts in two geographic areas: within the liquid-rich Core Wattenberg Field in Colorado and within the Delaware Basin in Texas.

Wattenberg Field, DJ Basin, Weld County, Colorado

The Wattenberg Field represents PDC’s largest asset with over 84% of the Company’s 2017 production and 75% of its year-end 2017 proved reserves. The Company has approximately 100,000 net acres in the core area making PDC the third largest leaseholder, as well as producer, in the Core Wattenberg. The Company is actively developing this liquid-rich field through horizontal drilling in the Niobrara and Codell formations. As of year-end 2017, the Company estimates that it has 1,500 gross horizontal future drilling locations in the Wattenberg Field.

Unique Geological Setting of Core Wattenberg Field

The Wattenberg Field is one of the top rate-of-return horizontal oil plays in the U.S. Onshore. PDC has successfully drilled the equivalent of 20-22 horizontal wells per 640-acre section, to more efficiently capture the large oil and gas resources in-place in the Niobrara and Codell formations, which contain over 300 feet of combined reservoir rock. The Core Wattenberg Field is a well-defined area north of Denver that owes its prolific productivity to its unique geologic setting. The Core overlies an area of crustal basement rock weakness, which is limited in geographic extent. This crustal weakness allowed unusually high heat flow from deeper mantle sources to “super-heat” the highly organic Niobrara source rocks, which in turn generated the significant oil and gas deposits now contained in the Niobrara and Codell formations. The crustal basement weakness extends south-westerly of Wattenberg beneath the Rocky Mountains, where the same high heat flow system has contributed to extensive mineral deposits. This southwest extension is commonly known as the Colorado Mineral Belt, because of the World Class deposits of gold, silver and molybdenum.

The Company continually pursues additional capital efficiencies designed to improve economic returns. These enhancements include tighter completion spacing and exclusive use of “plug-n-perf” completions and mono-bore drilling. The 2018 capital investment program is focused on the Kersey area, with some spuds in its Plains area, as well as turning-in-line the 24 horizontal wells it acquired in the Prairie area. The Company expects to run three drilling rigs in 2018.

Delaware Basin, West Texas 

In December 2016, PDC made a significant acquisition of assets in the Delaware Basin. As of year-end 2017, the Company had approximately 60,000 net acres in Reeves and Culberson Counties. The Company expects to run three drilling rigs in 2018. The drilling in 2018 is focused primarily on drilling single Wolfcamp wells in the A or B benches to meet drilling obligations, as well as a downspacing test in its Eastern area that will evaluate the equivalent of 12-wells per section in the Wolfcamp A and a well that will test the Wolfcamp C.

Robust Inventory Potential in the Basin's ~3,000' Thick Gross Interval

The Delaware Basin has gross potential pay interval that is around 3,000 feet thick from the top of the Bone Spring and Avalon Shale to the base of the lower Wolfcamp. The Company’s year-end 2017 analysis identified 450 drilling locations with an average lateral length of ~7,500’ in the Company’s oiliest Eastern and North Central focus areas. Some of these location are subject to a higher degree of uncertainty as they reflect assumptions primarily related to future downspacing that the Company is either in the process of testing, or has not yet tested.