Allied Energy Preps Giddings Well for Production

Allied Energy is making preparations to commence production operations for the Allied Howard #1H and begin drilling its second horizontal well, the Allied Howard #2H, in the historic Giddings Field of Grimes County, Texas.

On May 15, 2010, the Howard #1H tested at a flowing rate of 4,011 MCFGD on a 20/64" choke with associated condensate. Construction of the production / surface facilities, NGL processing unit, etc. is now complete and production operations for the Allied Howard #1H is scheduled to begin in the next two weeks.

Allied Gas Transmission, a majority owned subsidiary of Allied, has completed building 4,000+/- feet of pipeline and hydro-tested the line at 2,220 PSI in order to begin selling gas to the Atmos Energy, Inc. Interconnect.

Road and location construction is currently underway for the Allied Howard #2H well and the Pioneer Rig #33 is scheduled to begin moving on location in the next week to begin drilling.

"We are extremely pleased with the results we have seen thus far in the Giddings Field and look forward to utilizing the technological advances that relate to horizontal drilling and production," said Steve Stengell, Allied's President. "We are also making tentative plans for a third location in the future," added Stengell.

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