Allied Energy Preps to Drill 2nd HZ Well in Tx.

Allied Energy is making preparations to begin drilling its second horizontal well in the historic Giddings Field of Grimes County, Texas.

Earlier this spring, Allied's first location, the Allied Operating Howard #1H, was drilled to a total measured depth of approximately 17,000' in two horizontal laterals oriented northwest and southeast along existing trends. The Howard #1H encountered a series of natural gas bearing intervals while drilling through the primary objective Buda / Georgetown Limestone Formation.

On May 15, 2010, the Howard #1H tested at a flowing rate of 4,011 MCFGD on a 20/64" choke with associated condensate. It is anticipated that the well will initially produce at the sales rate of ~ 2,000 MCFGD and potentially higher in the future. The company has constructed the production facilities, gas flow lines, processing facilities and other necessary surface equipment in preparation to begin its ongoing production operations.

"We are extremely pleased with the results we have seen thus far for this project and are now making plans for our second horizontal location," said Steve Stengell, Allied's President. "Allied plans to continue to pursue and develop additional horizontal opportunities in Central-East Texas and implement the newer technological advances that relate to horizontal drilling and production," added Stengell.