FX Energy: Winna Gora Drillsite Under Construction

FX Energy, Inc. reported Thursday that all required permits have been issued for the Winna Gora-1 well in Poland and that the well location is currently under construction. Drilling is expected to begin in early September.

The Roszkow-1 well is in the tender process to select a drilling contractor, and drilling is currently planned to begin in the fourth quarter of this year. The Polish Oil and Gas Co. is the operator of the Winna Gora-1 and the Roszkow-1 wells and owns 51%. FX Energy owns the remaining 49%.

The construction of the Wilga gas/condensate field production facilities and the Zaniemysl gas field production facilities are nearing completion, with initial production expected in September 2006. FX Energy owns an 82% interest in the Wilga field and a 24.5% interest in the Zaniemysl field.

FX also reported that it will drill a well in Montana to test a new heavy oil play. The company owns the drilling rig, which it operates, and can earn up to a 60% interest in the project. "This project fits our business model perfectly," said Andy Pierce, FX's chief operating officer. "This play has the potential to earn a sizeable acreage position and discover meaningful reserves. It is near our existing Montana production and can be drilled at a low cost using our equipment and personnel." The well is scheduled to begin drilling in approximately 30 days.

FX Energy will also drill two wells in Railroad Valley Nevada, with the first well beginning early in the fourth quarter. The company owns a 50% interest in both wells.

FX Energy, Inc. holds a land position of more than 1.7 million acres in a known hydrocarbon region in western Poland's Permian Basin. The Permian Basin's gas-bearing Rotliegend sandstone is a direct analog to the Southern Gas Basin offshore England and represents a largely untapped source of potentially significant gas reserves.