Kentucky Energy has elected to expand its energy based operations into oil and natural gas exploration and development.
The Company is in the final stages of exercising an option on over 3,000 acres in Rockcastle County, Kentucky, in drilling participation with United States Energy Corp. (USE). In anticipation of drilling, USE has surveyed three drill sites and is in the process of preparing permits for the drill sites in conjunction with the participation development agreement.
There are three potential economic horizons. The Knox formation at about 2700 feet deep is the primary target. The Sunnybrook (Middle Ordovician) is a viable secondary prospect. Upon completion of the option, Kentucky Energy intends to participate in at least two test wells this year with other industry partners.
Kentucky Energy and United States Energy have mutually agreed to enter into a substantive Area of Mutual Interest Agreement which could result in the acquisition of up to an additional 10,000 acres by Kentucky Energy.
Kentucky Energy Chairman, Eugene Chiaramonte, Jr., noted, "With the intense interest in the Marcellus Shale and other Appalachian "tight sands" we feel this acreage play positions the Company for an exciting and extensive play in the oil and gas sector, hedging against our current position as a provider of high quality compliance coal."
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