KFG Resources President Robert A. Kadane reported that KFG's wholly owned subsidiary, KFG Petroleum Corporation, has completed its Spring Hill #7 well in the Stewart A1 Sand at 3780 feet.
The well, located in the Fayette Field, Jefferson County, Miss., is producing 70BOPD of 40 gravity sweet crude oil. The 4600' Sand is also productive at this location but will remain behind pipe for the time being. KFG holds a 100% working interest(79.16% net) in the well until payout of all costs incurred to date in the field. At this writing, approximately $1,400,000US remains to be recovered. At payout, the Company's interest in the field reverts to a 74.6% working interest(59.1% net). Field production is approximately 190 BOPD at present.
Concordia Parish, Louisiana
The Company is planning to drill three(3) 6000' Wilcox tests on a 1500 acre lease about 3 miles south of the town of Vidalia. Because of high water in the Mississippi River the start date has been delayed until late May 2011. The Company will retain a 12.5% working interest in the project and back in after payout for an additional 20% working interest. All producing zones in the Wilcox interval will be evaluated.
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