UnionTown Awaits Arrival of Service Rig at Miami Property

UnionTown expects a service rig to arrive this week at its New Miami property to prepare the recently drilled #42-20H well for production.

"We're excited to be so close to putting the well on pump and commencing production," said UnionTown's Chief Executive Officer Michael Butterworth. "This is undeniably a huge milestone for our company. The New Miami #42-20H will be our company's first producing well, and the initiation of production will formally mark our transition from an exploration-stage company to an oil producer and revenue generator."

The first order of business for the service rig crew will be to acidize the pay zone in the horizontal leg to encourage higher production rates. Next, they will swab the well back through the tubing. Once these steps are completed, the tubing will be removed and the pump installed. UnionTown expects to bring the pump online and commence oil production within seven to ten days of the arrival of the service rig.

Following commencement of production, the company estimates it will take about seven days to stabilize the pump and determine the flow rate. Based on this anticipated schedule of events, UnionTown expects that it will be able to report its first production results during the company's 4th quarter, which ends October 31.

Drilling on the New Miami #42-20H well was completed on June 19, 2011. The well was designed to horizontally penetrate and expose approximately 2,000 feet of the Sun River Dolomite pay zone (the upper three to five feet of the Madison Formation). During the horizontal drilling process, two secondary Madison Formation pay zones were also encountered.

As previously reported on April 11, 2011, the New Miami #42-20H is one of two initial wells the company plans to drill on the property. The company considers these two wells will be lower in exploration risk as they are offset from two previous vertical wells that have determined the New Miami property sits atop a shallow oil accumulation. UnionTown believes the property could accommodate up to 17 shallow horizontal oil well drill zones.

The New Miami property comprises more than 1,480 acres in the Sweetgrass Arch area of northwest Montana.