Allied Energy Group, Inc. Provides an Overview of Its Oil and Gas Drilling and Production Operations
Allied Energy Group, Inc. provided the following update regarding its coalbed methane projects in Oklahoma and other oil and gas developments in strategic areas of operations throughout the domestic U.S.:
Rogers County, Oklahoma
Allied Energy Group, Inc. and its strategic industry partners currently have a reported 17 wells in production, 11 wells in completion and/or planned to be re-completed, and a projected 8-10 more wells tentatively scheduled to be drilled by early 2007 in Rogers County with plans to potentially drill and develop an additional 20-25 coalbed methane wells in this same area beginning in 2007.
The Company has successfully drilled and discovered gas in multiple coal seams for its 5-well program and is currently in completion for each of the 5 wells. The Company is scheduled to immediately begin drilling three additional wells in close proximity to this area.
The Company has finalized an agreement with Insight Energy Corporation to acquire an additional 220 +/- acre lease to rework and re-complete 5 existing wells and drill 3 new locations near the Caney River in Rogers County, Oklahoma. “We expect to have our 5-well program in production and begin drilling our 3-well program in the very near future,” said Steve Stengell, Allied’s Sr. Vice President Operations.
The Company also has plans to drill and develop an additional 20-25 coalbed methane wells in this same area beginning in 2007.
The Company and its partners have varying degrees of working interest ownership in each well to be developed.
The Company and its strategic industry partners have been making specific improvements to the field operations that include repairing equipment, modifying gas lines, and adding compressors to improve the general efficiency of the production operations.
Based on this area’s production history and our results to date, the Company expects to achieve gross well production of 1,700,000 cubic feet of natural gas per day from 38 wells in the very near future, which at current market prices approximates gross figures of $11,000 per day before line charges, royalties, taxes and operating expenses. No assurances can be given that such production will be achieved or revenues realized.
For the long-term, the Company and its industry partners have secured approximately 4,000 +/- acres currently under lease or to be leased in this area and has future plans to participate in the drilling of as many as 150-200 coalbed methane wells in this part of Oklahoma. Based on production in this area, gross production from 200 wells would be projected at 9,000,000 cubic feet of natural gas per day, which at current market prices approximates gross figures of $60,000 per day before line charges, royalties, taxes and operating expenses. Once again, although the company remains confident as to its future operations, no assurances can be given that such production will be achieved or revenues realized.
Knox and Laurel Counties, Kentucky
The Don Sullivan #8, Clarence Bright #2, and Dale Greer #1 were successfully drilled and encountered gas in the Big Lime and/or Waverly formations. The Company owns 16.67% working interest in each of these three wells.
An acid “frac” stimulation has been successfully performed for both the Don Sullivan #8 and Dale Greer #1 wells located in Knox and Laurel Counties, Kentucky.
A sand “frac” stimulation is scheduled to be performed for the Clarence Bright #2 this week. “Based on the results of this type of treatment to the Waverly formation of a nearby well, we anticipate an initial production target rate of 100,000 cubic feet of natural gas per day,” said Steve Stengell.
The Don Sullivan #8 reported 245 lbs. of shut-in pressure and after treatment was placed into production at a reported initial rate of 60,000 cubic feet.
The Dale Greer #1 was successfully drilled to an approximate depth of 1,350 feet and had 12 feet of fractured potential pay-zone in the Big Lime formation. The Dale Greer #1 should be in production in the very near future.
The Clarence Bright #2 was successfully drilled to an approximate depth of 1,650 feet and has a reported potentially productive pay-zone of 75 total feet in the Devonian Shale, Waverly, and Big Lime formations.
Schleicher County, Texas
The Company is currently evaluating results from various treatments performed to restore production operations for the Pring-Allied #1 and re-establish production for the Pring-Allied #2 located on its El Dorado Leasehold. The Pring-Allied #1 has previously reported daily production rates as high as 60 barrels of oil per day and the Pring-Allied #2 has a reported 30 feet of potentially productive oil pay-zone. However, production for the Pring #1 is still marginal and monomer treatments to the Pring #2 were unsuccessful. The Company drilled the Holly Beth #1 well to a total depth of 5,800 +/- feet. The well was deemed noncommercial.
Illinois Basin and Eastern Kentucky
The Company is finalizing plans to potentially explore and aggressively develop several strategic gas plays in the Illinois Basin and Eastern Kentucky.
A myriad of independent oil and gas companies have been and continue to be successful in developing a number of natural gas developments in these areas.
“Understanding the inherent risks associated with our industry, Allied is extremely confident that its continued focus in areas of the more conservative nature as a strategy to build future production and reserves is key to the Company’s future success,” said Steve Stengell.
About Allied Energy Group
Allied Energy Group, Inc. (Other OTC:AGGI.PK – News) is an independent energy development firm primarily engaged in the exploration, development, and production of oil and natural gas in the continental United States. The company relies upon its industry partners, well operators, geologists, petroleum engineers, seismic specialists, and financial analysts whose combined industry experience is essential to the success of each project. Allied Energy Group’s strategic focus is the development of oil and natural gas reserves. As the fuel of choice to meet the growing demand for a clean-burning domestically produced fuel, the company firmly believes its natural gas exploration strategy should provide substantial growth to the company for the years to come.
For more information: www.alliedenergy.com
Certain statements in this release and the attached corporate profile that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by the use of words such as “anticipate,” “believe,” “expect,” “future,” “may,” “will,” “would,” “should,” “plan,” “projected,” “intend,” and similar expressions. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. The Company may have varying degrees of working interest ownership in each well and/or prospect. Thus, gross revenue projections may not be equal to what is distributed net to the Company. The Company’s future operating results are dependent upon many factors, including but not limited to the Company’s ability to: (i) obtain sufficient capital or a strategic business arrangement to fund its expansion plans; (ii) build the management and human resources and infrastructure necessary to support the growth of its business; (iii) competitive factors and developments beyond the Company’s control; and (iv) other risk factors.
Contact:
Company Contact:
Steve Stengell Allied Energy Group, Inc. 2800 Griffin Dr, Bowling Green, KY. 42101 Phone: 866-256-5836 Fax: 800-251-9322 Website: http://www.alliedenergy.com
Email: info@alliedenergy.com
Source: Allied Energy Group, Inc.
