Allied Energy, Inc. Provides Operations Updates
BOWLING
GREEN, KY-- (Marketwire – May 24, 2013) - Allied Energy, Inc.
(“Company”)
(OTCMarkets: AGGI) today announced updates relating to its
operations.
Drilling Update:
J.T. Fields-Berry
Wells, Caldwell County, TX:
During March 2013,
the Company began the development of five
wells in Caldwell County, TX, consisting of four existing wells and
one
newly-drilled well. Our engineers are targeting both the Buda and
Austin Chalk
formations in each of the wells; thus far, one well has been
completed in both
zones, three wells have been completed in the Buda formation only,
and one well
has been completed in the Austin Chalk formation only.
As of May 2013, the wells
have been
placed on pump and are now in the “flow-back” stage, during which
time
remaining treatment fluids are being recovered. We are beginning to
see an “oil
cut” in the returning fluids, with total average
aggregate production for all five wells ranging from 25 to 30
barrels of oil
per day (“bopd”).
The costs of developing the wells located within the J.T.
Fields-Berry lease are being funded by a general partnership
sponsored by the
Company. The partnership holds an aggregate majority working
interest in
the J.T. Fields-Berry wells. The Company holds a 0.1% working
interest
(0.075% net revenue interest), inclusive of its interests in the
general
partnership.
Clark #1 Test Well,
Milam County, TX:
During August 2012, the Company
participated with an industry partner in the drilling of the Clark
#1 test
well, with the objective of testing the Pecan Gap formation.
The Pecan Gap formation was determined
to be non-productive, and Allied has elected to move “up-hole” to
test and
attempt completion in the Navarro Sands formation, which is known
to be
productive in the area. Upon that
election, the industry partner transferred its interest to Allied,
and the Company
now owns a 100.0% working interest (77.25% net revenue interest) in
the Clark
#1 test well.
Pearson C1 Test Well,
Milam County, TX:
During August 2012, the Company participated with an industry
partner in
the drilling of the Pearson C1 test well, with the objective of
testing the
Pecan Gap formation. The Pecan Gap
formation was determined to be non-productive, and Allied has
elected to move
“up-hole” to test and attempt completion in the Navarro Sands
formation, which
is known to be productive in the area.
Upon that election, the industry partner transferred its interest
to
Allied, and the Company now owns a 100% working interest (77.25%
net revenue
interest) in the Pearson C1 test well.
Non-Commercial
Well Update:
#1 Konvicka Well, Lavaca County,
Texas: During December 2011, the
Company purchased working interests in the #1 Konvicka
well located on the Yoakum East Property lease. In January
2012, in an attempt to increase production, a
fracking operation was scheduled and completed. Due to
unknown reasons, the procedure failed. The Company’s engineer
has finalized a
report of the failed procedure, and there are no further plans to
re-complete
the well. The costs of developing the #1 Konvicka well were funded
by general
partnerships sponsored by the Company.
Production Update:
Ragsdale #2
Well:
During March 2013, the Ragsdale #2 well, located in Cherokee
County, TX,
was completed and placed on pump.
The well produced approximately 20 bopd during initial
production
testing and during April 2013, it produced a total of 159 barrels
of oil.
The drilling and completion of the Ragsdale #2 well was funded by
two
general partnerships sponsored by the Company. The
partnerships hold a majority working interest in the
Ragsdale #2 well. The Company
holds a 0.25% working interest (0.1875% net revenue interest) in
the well,
inclusive of its interests in the general partnerships.
E. Cantrell
#1:
The
E. Cantrell #1 well, located in Wood County,
TX, was placed into production during February 2013. The E.
Cantrell #1 well
produced 243 barrels of oil during the month March 2013 and 72
barrels of oil during
the month of April 2013.
The E. Cantrell #1 well was funded by two general partnerships
sponsored
by the Company. The partnerships
hold a majority working interest in the E. Cantrell #1
prospect. The Company holds a 0.05037% working
interest (0.03777% net revenue interest) in the well, inclusive of
its
interests in the general partnerships.
Acquisition
Update:
Acquisition of
Additional Acreage in Milam County, TX:
During May
2013, the Company acquired a lease in Milam County, TX, comprising
240 acres.
Additional Working
Interest Acquired in the High Island Block 19S
Prospect:
In May 2013, the Company entered into an agreement to purchase
an
additional 77% working interest in the High Island 19S Prospect,
which brings
the Company’s total working interest ownership to 80% and a
corresponding net
revenue interest ranging between 59.2% and 63.2%.
Withdrawal from
Participation:
North Constitution
“Hooks” Prospect:
In October 2012, the Company
entered into an agreement to participate with industry partners in
the drilling
of a well in Jefferson County, TX.
During March 2013, the Company executed an “exit agreement”
which
formally withdrew the Company from any participation or involvement
in the
North Constitution “Hooks” Prospect.
Disposition of
Certain General Partnerships:
Rogers County,
Oklahoma:
The
Company continues to evaluate all the interests of the general
partnerships for
which the Company acts as managing general partner in Rogers
County, OK. The Company is conducting a review of
production and expense records to determine the financial condition
of the
partnerships and the status of each of the partnerships wells, a
large majority
of which may be non-commercial.
Based upon the findings of the review, we have begun to make
specific
recommendations either to 1) “shut-in” wells that might benefit by
a future
rebound in the market prices of gas, 2) plug and abandon wells
deemed to be
non-commercial, or 3) continue to operate wells that are profitable
or may be
candidates for enhancement procedures or re-engineering to improve
production.
It is anticipated that some of the general partnerships sponsored
by the
Company holding interests in wells in Rogers County, Oklahoma may
be terminated
due to non-profitable operations.
About
Allied Energy:
Allied
Energy, Inc. is engaged in the oil and gas exploration and
development
business, with operations located primarily in Texas, Oklahoma and
Ohio. The Company sponsors oil & gas
partnerships through which it raises funds for the drilling and
development of
oil & gas wells. The Company
serves as managing general partner of the partnerships and often
owns differing
partnership interests in the partnerships and/or differing direct
interests in
the properties in which the partnerships
participate.
The
Company’s subsidiaries include Allied Operating, LLC and Allied
Operating,
Texas, LLC, two operating companies that are used to undertake,
either directly
or through third-party contracting entities, the drilling,
development and
operations of the oil & gas drilling partnerships sponsored by
the Company,
as well as for other non-affiliated oil and gas companies that are
joint interest
owners in drilling activities owned primarily by partnerships
sponsored by the
Company. The Company is also
majority owner of Allied Gas Transmission, Inc., which owns the
pipeline system
used to transmit production from gas wells located in Rogers
County, Oklahoma
to gas purchasers.
The
Company’s ultimate strategic focus is on the development of oil and
natural gas
production and reserves. The
Company believes that its oil and natural gas development strategy
will provide
growth to the Company in the future.
For more information:
www.alliedenergy.com
Forward-Looking
and Continuing Statements:
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, including, but not limited to, geological and geophysical
risks inherent
to the oil and gas industry, and uncertainties and other factors
that may cause
the actual results, price of oil and natural gas, state of the
economy,
industry regulation, reliance upon expert recommendations and
opinions, and
performance or achievements of the Company to be materially
different from
those expressed or implied by such forward-looking
statements. The Company's future operating results
are dependent upon many factors, including but not limited to: (i)
the
Company’s ability to obtain sufficient capital or strategic
business
arrangements to fund its drilling plans; (ii) the Company’s ability
to 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, including but not limited to the strength of the
overall
economy; and (iv) other risk factors inherent to the oil and gas
industry.
Contact:
Heather Age
Allied Energy,
Inc.
2427
Russellville Road
Bowling Green,
KY 42101
Phone:
800-330-2535
Fax: 800-251-9322
Website:
http://www.alliedenergy.com
Email:
info@alliedenergy.com
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