The Company has executed an agreement to acquire an additional 220 +/- acre lease to rework and re-complete 5 existing wells and drill 3 new locations near the Caney River in Rogers County, Oklahoma. Each existing well and new drill location has the potential to commingle production from multiple coal seam formations.
"This particular leasehold is ideal in that it provides an opportunity for us to re-complete existing wells for almost immediate production operations," said Steve Stengell, Allied's Sr. Vice President of Operations. "Additionally, this property should provide 3-6 additional new drill locations above that of the 3 wells already planned to be drilled for a projected total of 11-14 potential wells at this leasehold," added Stengell.
Allied Energy Group, Inc., and its strategic industry partners, currently have a reported 15 wells in production, 2 wells being placed into production, 11 wells in completion and/or planned to be re-completed, and a projected 8-10 more wells tentatively scheduled to be drilled by early 2007 in Rogers County with plans to potentially drill and develop an additional 20-25 coalbed methane wells in this same area beginning in 2007. The Company and its investor partners have varying degrees of working interest ownership in each well to be developed.
For the long-term, the Company and its strategic industry partners have secured approximately 4,000 +/- acres currently under lease or to be leased in this area and have future plans to participate in the drilling of as many as 150-200 coalbed methane wells in this part of Oklahoma. Based on production in this area, gross production from 200 wells would be projected at 9,000,000 cubic feet of natural gas per day, which at current market prices approximates gross figures of $60,000 per day before line charges, royalties, taxes and lease operating expenses. Once again, although the company remains confident as to its future operations, no assurances can be given that such production will be achieved or revenues realized.
Allied Energy Group, Inc. is an independent energy development firm primarily engaged in the exploration, development, and production of oil and natural gas in the continental United States.
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