Denbury Resources Announces 15% Increase in Production Expected for 2002; Sets 2002 Capital Expenditure Budget; Sets Third Quarter Conference Call.

Business Editors

DALLAS--(BUSINESS WIRE)--Oct. 26, 2001

Denbury Resources Inc. (NYSE:DNR)(TSE:DNR.) ("Denbury" or the "Company") today announced its estimated 2002 daily production volumes and projected 2002 development and exploration expenditures ("CAPEX") budget. Daily production next year is estimated to average 36,000 barrels of oil equivalent ("BOE"), or 216 million cubic feet equivalent ("MMcfe") of natural gas, which would be a new production benchmark for the Company. Capital expenditures in 2002 are preliminarily set at $120 million.

Capital Expenditure Program

The 2002 CAPEX budget is balanced among the Company's core areas, risk and commodities. Approximately 20% is budgeted to be spent in each of the Company's core areas: Eastern Mississippi, Western Mississippi (CO2 area), onshore Louisiana and offshore Gulf of Mexico. The balance is set aside for discretionary spending, corporate overhead and other areas. The budget also follows the Company's normal practices, with 10% to 15% budgeted for exploratory drilling and the remainder predominately related to lower risk development drilling, completion costs, facilities, waterfloods and tertiary recovery operations. The budget will be funded from internally generated cash flow. Denbury does not factor acquisition opportunities into its annual budget.

Increase in Daily Production Volumes

Based on this CAPEX budget and current commodity prices using the Company's normal methodology, risking and assumptions, the Company's targeted production for 2002 would be a Company record 36,000 BOE per day, comprised of an estimated 16,000 barrels of oil per day and 120 million cubic feet of natural gas per day. This would represent a 15% increase from Denbury's anticipated average production results for 2001. The funds to be spent for new tertiary recovery operations (approximately 20% of the budget) are not expected to generate any significant production increases until 2003 and beyond.

Mr. Gareth Roberts, Chief Executive Officer of Denbury, said, "In keeping with our fiscal policy to budget less than our anticipated cash flow for CAPEX and in light of lower anticipated oil and natural gas prices for next year, our preliminary 2002 CAPEX budget has been set at $120 million. Based on this budget and our other assumptions as outlined herein, our 2002 spending, excluding any potential acquisitions, should be comfortably less than our discretionary cash flow. We have already identified at least $150 million of additional investment opportunities which are currently targeted for 2003. Some of these opportunities could be added to the 2002 budget if 2002 commodity prices turn out to be higher or 2002 costs turn out to be lower than currently anticipated."

Third Quarter Conference Call

Denbury will release its third quarter 2001 results Thursday morning, November 1, 2001.

You are invited to listen to our conference call broadcast live over the Internet on Thursday, November 1, 2001 at 9:00 a.m. CDT. Gareth Roberts, President and Chief Executive Officer, Phil Rykhoek, Chief Financial Officer, Mark Worthey, Vice President - Operations and Tracy Evans, Vice President - Reservoir Engineering, will lead the call. The call may be accessed at our Web site at www.denbury.com. If you are unable to participate during the live broadcast, the call will be archived on our Web site for approximately 30 days. The audio portion of the call will also be available for playback by phone for one week after the call by dialing 888/203-1112, passcode 574843.

Denbury Resources Inc. (www.denbury.com) is a growing independent oil and gas company. The Company is the largest oil and natural gas operator in Mississippi and holds key operating acreage onshore Louisiana and in the offshore Gulf of Mexico. The Company increases the value of acquired properties in its core areas through a combination of exploitation drilling and proven engineering extraction practices.

This press release, other than historical financial information, contains forward looking statements that involve risks and uncertainties, including expected drilling activity and results, production levels, commodity prices, financial results and other risks and uncertainties detailed in the Company's filings with the Securities and Exchange Commission, including the reports on Form 10-Q. These reports are incorporated by this reference as though fully set forth herein. These statements are based on assumptions concerning pricing, scheduling, drilling and completion results and engineering assumptions that management believes are reasonable based on currently available information; however, management's assumptions and the Company's future performance are both subject to a wide range of business risks, and there is no assurance that these goals and projections can or will be met. Actual results may vary materially.