RIVERTON, Wyo., Sept. 17, 2008 (GLOBE NEWSWIRE) -- U.S. Energy Corp. (Nasdaq:USEG) ("USE" or the "Company"), a natural resources exploration and development company with interests in molybdenum, oil and gas, and real estate, today announced that its partner, PetroQuest Energy L.L.C. ("PetroQuest") (NYSE:PQ), has reached contract depth on the Bluffs Prospect in Louisiana, encountering approximately 85 feet (true vertical depth) of net pay in the Cris I - Hollywood 1 Sand.
"These results mark a successful start to our relationship with PetroQuest as we begin to progress through the initial three-well drilling program," stated Keith Larsen, CEO of U.S. Energy Corp. "With a strong financial position and these first steps in our strategy completed, we are currently evaluating additional opportunities as we look to expand our oil and gas portfolio."
A production liner has now been set and completion is expected to take place over the next few weeks. Further testing will be required before actual production rates of the well will be known. Production from the well is expected to commence in the fourth quarter of 2008 but is dependent on the logistical impact of the Atlantic Hurricane Season. U.S. Energy Corp. participated in this well as a 20% working interest partner with a 25% back-in provision to completion decision. This back-in provision is held by a participant in the well and is specific to this leasehold. As a result, U.S. Energy Corp. will have a 15% working interest in this well going forward. This provision will not apply to the next two prospects to be drilled with PetroQuest. Following completion at the Bluffs Prospect, the rig will be mobilized to spud the Highlands Prospect. The Highlands well should spud within two weeks and is estimated to reach its target depth in the fourth quarter. It is anticipated that immediately following the drilling of the Highlands Prospect, the rig will then be moved to spud the St. Andrews Prospect. PetroQuest, Inc. will be the operator of both of these projects.
About U.S. Energy Corp.
U.S. Energy Corp. is a diversified natural resource company with interests in molybdenum, oil and gas, and real estate. The Company is headquartered in Riverton, Wyoming, and its common stock is listed on The NASDAQ Capital Market under the symbol "USEG."
The U.S. Energy Corp. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5043
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.
This news release includes statements which may constitute "forward-looking" statements, usually containing the words "believe," "estimate," "project," "expect," or similar expressions. 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. 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.