Dune Energy Reaches TD at McPeek Barnett Shale Well

Dune Energy reports that its Foster-McPeek #1 well has reached total depth of 9,036 feet, and encountered a Barnett Shale section comparable to the section on our adjacent wells, McPeek #1 (currently producing) and McPeek #2 (scheduled for fracture stimulation the week of August 28). The Foster-McPeek #1 is presently in the process of completion. Dune anticipates that this well will be placed on production shortly after fracture stimulation, which is scheduled for late September, dependant upon equipment availability. In addition, the Foster-McPeek #1 also encountered Marble Falls pay, which will be evaluated as potential "behind pipe" reserves. The Foster-McPeek #1, located in Denton County, Texas, offsets Dune's McPeek #2 well, which encountered a significant Barnett Shale section. Dune owns a 95% WI and a 69.4% NRI in the Foster-McPeek #1.

Dune will move the rig from the Foster-McPeek #1 to its Pitts #2 location, and will spud that well prior to month end. After completion of the Pitts #2, the rig will then move to a location to be determined.

In a related development, Dune expects delivery of its Itera #1 Rig by mid-September, for an initial term of two years. The Itera #1 will be dedicated exclusively for use by Dune, and will be capable of drilling both horizontal and vertical wells. Concurrent with the arrival of the Itera #1 Rig, Dune will accelerate the development of its Denton Country Club lease.

During the second week of September, Dune also expects to tie the UNT #1 well into a pipeline. The UNT #1 had been fracture stimulated and was shut-in until now, awaiting the construction of the pipeline. In addition, Dune is scheduling fracture stimulations for each of its Guyer #1 and Guyer #2 wells. The exact dates are dependent upon equipment availability and the completion of the construction of a pipeline, which is presently anticipated to be completed in October.