Miller Energy Brings Alaska Well Online

Miller Energy Resources, Inc. announced that its Alaskan subsidiary, Cook Inlet Energy (CIE), has successfully brought a new gas well, RU-3, into production. CIE completed the RU-3 gas workover on Osprey Platform with Miller's Rig-35. After a successful well test Feb. 16, the gas well was immediately put into production. This new source of natural gas, together with gas produced from CIE's RU-4 well which was previously brought online, further eliminates the need to purchase costly fuel gas from third parties. RU-3 showed an initial post-workover shut-in pressure of 2,135 PSI. The subsequent four-point flow test culminated in a peak flow rate of 3.7 million cubic feet of gas per day (MMscf/d) at a 25/64ths inch choke setting.

The RU-3 work-over consisted of re-completing the well to access a behind pipe gas accumulation in the Lower Tyonek gas sands at a measured depth of approximately 14,800 feet. RU-3 encountered an average of 20 feet of net gas pay across an estimated 150-acre reservoir with an estimated minimum of 1.2 BCF of remaining recoverable reserves. The zone produced a total of 452 MMscf between May and December of 2003. At that time, the well went off production due to mechanical problems and had subsequently been plugged back to a shallower zone for an attempted completion. CIE successfully completed a complex fishing job to remove materials and equipment left in the wellbore from this previous completion attempt in order to reopen the deeper proven reservoir and reestablish production.

CIE is currently producing both RU-3 and RU-4 gas wells at reduced rates while supplying its own fuel gas needs. Company is in discussions with third parties to establish gas sales.

"We're very pleased with RU-3 four-point flow test results as well as recent success with RU-4; this now establishes gas production from two out of six compartmentalized fault blocks on the Redoubt structure which we have high level of confidence the remaining un-tapped fault blocks will prove gas productive," explained David Hall, CIE's CEO.

"We could not be more pleased with the performance of RU-3 and our other newly recompleted wells in the Cook Inlet," said Scott M. Boruff, Miller's CEO. "The results seen with RU-3 and the recently recompleted RU-1 and RU-4 wells vindicate the strategy we have been pursuing in this basin, and clearly demonstrate the value both of our assets and of our operational team in Alaska."


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