Operations

Simmons is an independent oil and gas company based in Farmington, New Mexico with operations in the San Juan and Paradox Basins. DJ Simmons has roots in Texas where its founder, David Jack Simmons, drilled wells in the 1940’s. Mr. Simmons acquired acreage in the San Juan Basin in the 1950’s, and drilled his first wells there in 1952. D.J. Simmons, Inc. has had operations in the Four Corners since that time.

A Philosophy of Long-Term Value

Operational decisions at DJ Simmons rely on the philosophy of extracting maximum long-term value of its assets. The Company is intelligently cautious and risk averse as it seeks to maximize long-return on its capital investments.

Operational decisions are made with an eye toward “doing it right the first time” and avoiding making the same expenditure twice. The engineering and production staff is sharply focused on stable production and predictable cost expenditures. For DJ Simmons, the bottom line is execution.

This philosophy works well for the Company’s family owners and numerous working-interest owners. Projects are designed and completed so that long-term returns are maximized. Wells are not cheaply completed at the expense of foregoing the value-enhancing possibilities of subsequent reentry and maximum resource recovery.

Intelligent Expense Control

Like all commodity producers, DJ Simmons cannot, in the long run, control the prices of the commodities it produces. Intelligent expense control helps Simmons produce regular, consistent cash flow and earnings. The Company operates its 100 wells with a lean, well-trained staff of one engineer, two production foremen, four pumpers, and a rig supervisor. This sharply focused team actively manages the Company’s asset base and oversees a set of excellent vendor relationships.

Preventative maintenance is a hallmark of a well-run E&P company. The operations team at Simmons strives to keep production running and avoid unexpected down time by relying on systematic preventative maintenance practices as opposed to the approach of “we’ll fix it when it breaks.” Strong human involvement and a sense of personal responsibility for results are characteristics of the Simmons operations team. For the operations team, it’s “eyes on and hands-on” that works best for stakeholders.

A Strong Safety and Environmental Record

The operations team at DJ Simmons believes that if you operate safely and comply with environmental regulations, you’ll also be operating cost-effectively and efficiently for the long-term. DJ Simmons’ operational personnel have an excellent lost time history with very few accidents over the last 20 years. When the Company acquires a production property, it raises the standards and appearance of that property and makes a strong effort to practice “good housekeeping.” As a result, Simmons has excellent regulatory relationships.

Results that speak for themselves

Results are what matters. The State of New Mexico Oil Conservation Division data shows that production from DJ Simmons’ wells is better than the average production of other producers in the San Juan basin. DJ Simmons production declines annually at an average rate of 3% versus the San Juan basin average of 7%. This means longer-lived wells at lower cost and, ultimately, higher returns on investment for owners and working interest owners.