Allied Energy, Inc. ("Company") (OTC Pink: 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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