Mammoth Energy Group Announces Completion of Two Wells in Oklahoma


DENVER, Sept. 25, 2006 (PRIMEZONE) -- Mammoth Energy Group Inc. (Pink Sheets:MMTH) announced today that its wholly owned subsidiary, KMV Consulting, has successfully completed two wells in its shallow gas project in Rogers County, Oklahoma. With these two wells, the total well count is now 12 producing wells. The two new wells were brought on-line in August and September and are on pace to add about 100,000 cubic feet per day (100 MCFD) in natural gas production as dewatering of the wells is completed. This should raise total production to just under 600 MCFD, which on a 12 month average for natural gas prices is the equivalent of about $3,900 in revenues per day before deducting line charges, royalties and operating expenses.

KMV Consulting has a 75% net revenue interest in these 12 gas wells on 1,075 net acres in Northeastern Oklahoma. This project has tremendous upside since it is located on a shallow, blanket gas field where nearly every well drilled produces natural gas and occasionally small amounts of oil.

"We are very pleased with how this project is coming along," said Christopher Miller, Mammoth's Chief Executive Officer. "We believe that this project will be one of our foundations where we can consistently add to our cash flow every month by bringing new wells on-line. Because this is a blanket coal seam, nearly every time we drill we expect that we will find natural gas and occasionally some oil. These wells produce at depths anywhere from 350 to 1,200 feet and are very economical to drill. As such, it is our goal to quickly expand our production base in Rogers County by having about 25 wells on-line by year end."

KMV acquired the property in May 2006 and in this short time has reduced operating expenses by replacing old equipment, improved production by adding compressors and has already added two wells. KMV is now working to secure additional acreage while scheduling other drilling and completion efforts to bring more wells on-line.

About KMV Consulting, Inc.

KMV is focused on developing shallow gas projects in northeastern Oklahoma due to the low risk, blanket characteristics in the area that make it possible to drill and produce a well nearly every time. It is currently focused on developing its Rogers County, OK project into a property with between 8,000 and 12,000 total net acres leased where it can embark on a drilling program aimed at getting 200 to 300 wells on-line. With drilling and completion costs under $100,000 per well, this project is positioned to grow consistently each month as new wells are brought on-line.

More information is available at the company's website at www.mammothenergygroup.com.

Cautionary note: This report contains forward looking statements, particularly those regarding cash flow, capital expenditures and investment plans. Resource estimates, unless specifically noted, are considered speculative. By their nature, forward looking statements involve risk and uncertainties because they relate to events and depend on factors that will or may occur in the future. Actual results may vary depending upon exploration activities, industry production, commodity demand and pricing, currency exchange rates, and, but not limited to, general economic factors. Cautionary Note to U.S. investors: The U.S. Securities and Exchange Commission specifically prohibits the use of certain terms, such as "reserves" unless such figures are based upon actual production or formation tests and can be shown to be economically and legally producible under existing economic and operating conditions.



            

Tags


Contact Data