Attached files
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| 8-K - FORM 8-K 11-17-09 - US ENERGY CORP | form8_k.htm |
877 North 8th West, Riverton, WY
82501 USA, Ph: (307) 856-9271, Fx: (307) 857-3050, www.usnrg.comFor
Immediate Release
U.S.
ENERGY CORP. ANNOUNCES INITIAL PRODUCTION RATE OF APPROXIMATELY 1,544 BOE/D FROM
THE LEE 16-21 #1H BAKKEN WELL
RIVERTON, Wyoming – November 16,
2009 – U.S. Energy Corp. (NASDAQ Capital Market: USEG) (“USE” or the
“Company”), a natural resources exploration and development company with
interests in oil and gas, molybdenum, geothermal, and real estate assets, today
announced the initial production rate from its Lee 16-21 #1H Bakken well and
provided an operations update regarding its Williston Basin drilling
program.
Williston
Basin - Bakken Drilling Program
The Lee
16-21 #1H well, which is operated by Brigham Exploration Company (NASDAQ: BEXP)
("Brigham" or "BEXP"), flowed at an initial 24-hour production test rate of
approximately 1,341 barrels of oil and 1.22 MMCF of natural gas per day or 1,544
BOE/D. The well was completed with swell packers and 28 fracture
stimulation stages. USE's initial working interest in this well is approximately
60% (~47% net revenue interest), and oil sales from this well are expected to
commence immediately. As with the previously completed BCD Farms
16-21 #1H well, gas sales will commence upon connection to a gathering system,
which is estimated to take about 90-120 days.
The
Strand 16-9 #1H well has been drilled to total measured depth of approximately
20,000 feet. Upon completion of the drilling, a sleeve was run into
the hole with 26 swell packers and completion initiatives will commence this
week. USE’s initial working interest in this well is approximately
40%.
Two
additional wells (wells #5 and #6 of the previously announced Drilling
Participation Agreement with Brigham) are currently drilling to
depth. The two wells are the Williston 25-36 #1H (~65% initial
working interest) and the State 36-1 #1H (~28% initial working
interest). As with USEG’s other Brigham program wells, both the
Williston and State wells are targeting the middle Bakken formation, and are
planned to be drilled to a total measured depth of approximately 20,000 feet
(~10,000 ft vertical; ~10,000 horizontal). To date, the drilling of
both the Williston and the State wells have progressed into the horizontal
portion of the well bore and are advancing toward target depth.
Press
Release
November
16, 2009
Page
2 of 3
“With the
successful completion of the Lee well, we have reached an average initial
production rate of 1,810 BOE/D on our first three wells in the Williston Basin,”
stated Keith Larsen, CEO of U.S. Energy Corp. "We continue to make
rapid progress with Brigham in the Rough Rider project area and fully expect
that an additional three wells will be completed by year end," he
added.
* * * *
*
About
U.S. Energy Corp.
U.S.
Energy Corp. is a diversified natural resource company with interests in oil and
gas, molybdenum, geothermal and real estate assets. The Company is
headquartered in Riverton, Wyoming, and its common stock is listed on The NASDAQ
Capital Market under the symbol “USEG”.
Note
Regarding BOE
In this
press release, BOEs are derived by converting gas to oil in the ratio of one
barrel of oil to six thousand cubic feet of gas (1 bbl:6 Mcf). Barrel of oil
equivalent ("BOE") amounts may be misleading, particularly if used in
isolation. A BOE conversion ratio of 1 bbl of oil to 6 Mcf of natural
gas is based on an energy equivalency conversion method primarily applicable at
the burner tip and does not represent a value of equivalency at the well
head.
Note:
Outstanding
third party elections may result in a change to USEG’s working interest and net
revenue interest on a well-by-well basis.
* * * *
*
Disclosure
Regarding Mineral Resources Under SEC and Canadian Regulations; and
Forward-Looking Statements
The
Company owns or may come to own stock in companies which are traded on foreign
exchanges, and may have agreements with some of these companies to acquire
and/or develop the Company’s mineral properties. An example is Sutter
Gold Mining Inc. These other companies are subject to the reporting
requirements of other jurisdictions.
United
States residents are cautioned that some of the information available about our
mineral properties, which is reported by the other companies in foreign
jurisdictions, may be materially different from what the Company is permitted to
disclose in the United States.
Press
Release
November
16, 2009
Page 3
of 3
This
news release includes statements which may constitute “forward-looking”
statements, usually containing the words “believe,” “estimate,” “project,”
“expect," or similar expressions. Forward looking statements in this
release relate to, among other things, USE’s drilling of wells pursuant to the
terms of the DPA, its ownership interests in those wells and the costs it
expects to incur in drilling those wells. There is no assurance that
any of the wells USE drills under the terms of the DPA with Brigham will have
results similar to those referenced in this press release or that any of the
wells drilled with Brigham will be productive at all. In addition,
initial production rates may not be indicative of future or long-term production
rates. These statements are made pursuant to the safe harbor
provision of the Private Securities Litigation Reform Act of
1995. Forward-looking statements inherently involve risks and
uncertainties that could cause actual results to differ materially from the
forward-looking statements. Factors that would cause or contribute to
such differences include, but are not limited to, future trends in mineral
prices, the availability of capital, competitive factors, and other risks
including those described in the Company’s filings with the SEC, which are
incorporated herein by reference. By making these forward-looking
statements, the Company undertakes no obligation to update these statements for
revision or changes after the date of this release.
For
further information on the differences between the reporting limitations of the
United States, compared to reports filed in foreign jurisdictions, and also
concerning forward-looking statements, please see the Company’s Form 10-K
(“Disclosure Regarding Forward-Looking Statements”; “Disclosure Regarding
Mineral Resources under SEC and Canadian Regulation”; and “Risk Factors”); and
similar disclosures in the Company’s Forms 10-Q.
*
* * * *
For
further information, please contact:
Reggie
Larsen
Director
of Investor Relations
U.S.
Energy Corp.
1-800-776-9271
reggie@usnrg.com
Nick
Hurst
Investor
Relations
The
Equicom Group
1-403-218-2835
nhurst@equicomgroup.com