The recently completed well open flow tested at the rate of 335,000 cubic feet of gas per day and is expected to go on stream in December 2006 at approximately 35,000 to 50,000 cubic feet of gas per day.
"We are pleased with the results of the initial well in our 2006 drilling program," Levi Mochkin, president and CEO of Avenue Group, commented. "The successful completion of this well affirms the validity of our strategy to focus our efforts on low risk Appalachian basin drilling to increase our cash flow."
The drilling program for the 2006 LP calls for the drilling of 10 gross wells (8 net wells) in West Virginia. Avenue has received a $1.5 million commitment from a Private Family Trust towards fulfilling its financial commitment to the operator.
The general terms of the 2006 LP call for Avenue Group's oil and gas subsidiary, Avenue Energy, to act as the general partner of the 2006 LP thereby receiving a 10% partnership share with its share rising to 20% post payout of capital invested.
The Appalachian basin covers over 185,000 square miles across seven states (from Western New York through Georgia and Alabama) and is the US's oldest producing region with production in excess of 46 tcf of gas from over 400,000 wells. In 2003, the National Petroleum Council estimated the basin still contained another 9 tcf of proved gas reserves and an additional 68 tcf of unproved gas reserves.
Avenue Group, Inc., through its subsidiary Avenue Energy, Inc., is engaged in the exploration and development of oil and gas reserves. Its strategy is to acquire a portfolio of oil and gas assets that include low risk oil and gas reserves internationally and the generation of low risk drilling opportunities in Appalachia and similar basins in the US.
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