Production from the Marg Area 1 at Port Neches is averaging 337 BOPD for this quarter. The production drop is due to fluctuation in both GOR and BS&W on various producing wells, low water injectivity in the reservoir and shut-in one producing well to perform a workover to replace a failed gravel pack setting. Coil tubing work was performed on 2 injection wells in order to resume injection of water and CO, in the reservoir. The Marg Area 2 did not respond favorably to CO, injection in the Kuhn #6 well. For this reason Texaco will not pursue any further development of this section of the reservoir due mainly to low target reserves. Instead Texaco will reallocate the money to a new Marg segment (Marg Area 3) in order to test a new process that will utilize the CO, to accelerate the primary production rates and reduce cycle time. Also the process should reduce water disposal cost, cash lifting cost, operating cost and increase the NPV of the reserves.