DENVER, Nov. 9, 2006 (PRIMEZONE) -- Mammoth Energy Group Inc. (Pink Sheets:MMTH) announced today that its wholly owned subsidiary, KMV Consulting, has scheduled three more wells to drill in its shallow gas project in Rogers County, Oklahoma. These three new wells are on acreage leased since KMV took over the project in May 2006 and will lay the groundwork for expanding the project over the next few months.
These wells to be drilled are expected to be productive since the area has several different blanket coal seams that run through the area, which is largely responsible for the 100% success rate in the area reported on over 300 wells. If completed, this would put KMV's total well count at 18 producing wells with five more wells scheduled to be drilled before year end.
"Should all 18 wells produce like our 15 on-line now, KMV would average about 825,000 cubic feet of gas per day," said Christopher Miller, Mammoth's CEO. "At today's natural gas prices, this is the equivalent of more than $5,000 in revenues per day before deducting line charges, royalties and operating expenses.
KMV Consulting has a 49.5% net revenue interest in these 18 gas wells on 2,550 acres in Northeastern Oklahoma after it sold off 33% of its working interest to Allied Energy for $1.5 million. Once about 30 wells are producing, management believes wells can be financed from cash flow every month.
"One of the reasons we are excited about this area, is that on our recently acquired acreage there are about 8 old oil wells that can be re-completed to produce gas and brought on-line for about half of the cost to drill a new well and complete it," said Christopher Miller, Mammoth's CEO. "This means that we can bring wells on-line faster and stretch our money further. Of the next 15 wells we plan to drill, about half of them fall into this category. Therefore, we hope to have about 30 wells producing by the end of the first quarter 2007."
About KMV Consulting, Inc.
KMV, as a wholly owned subsidiary of Mammoth Energy Group, Inc., 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 5,000 and 8,000 total net acres leased where it can embark on a drilling program aimed at getting 150 to 200 wells on-line. With rigs readily available and shallow wells that can be drilled quickly, 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
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