HOUSTON, Sept. 4, 2007 (PRIME NEWSWIRE) -- Index Oil and Gas, Inc. (OTCBB:IXOG) ("Index" or "the Company") today issued an update on its current and planned oil and gas operations. This covers the Company's:
-- Recent hook-up of Schroeder Gas Unit.
-- Discovery awaiting hook-up.
-- Participations in four active exploratory wells in Texas and
Louisiana, most of which are potentially high impact.
-- Plans to participate in the drilling of three additional high
potential wells in Texas.
-- Plans to drill up to 14 wells in Kansas.
FISCAL YEAR 2007 DISCOVERIES HOOK-UP
Schroeder Gas Unit 1, drilled on the Habanero prospect, is a discovery in the Frio sandstone in Goliad County, Texas. First production started on 31 August at an initial rate of 300 mcfpd (thousand cubic feet per day) on a 7/64" choke. Index has a 37.5% Working Interest ("WI") and 28.125% Net Revenue Interest ("NRI") in the well and corresponding 80 acre gas unit.
Hawkins 1 is also a Frio sandstone discovery in Matagorda County, Texas. The well is awaiting hook-up to the local gas pipeline infrastructure. Excessive rainfall and dependence upon operator activity on adjacent acreage have delayed first production. These issues are being resolved. First production is expected during fourth quarter 2007 or sooner. Index has a 12.5% WI and 10.010634% NRI in the well and the corresponding 160 acre gas unit.
ACTIVE FISCAL YEAR ("FY") 2008 WELLS
Ilse 1, drilled in search of high impact Middle Wilcox pay sands, reached a total depth of 17,000 feet and the drill rig was released on 4 April 2007. The well took longer to drill and test because of the use of a new rig, which experienced excessive down time for repairs, rainfall, and well control problems due to high pressure and carried into FY 2008. These issues resulted in a cost over-run to the original estimate. A Middle Wilcox zone was perforated between 16,760 feet and 16,784 feet, hydraulically fractured, and, on 5 June 2007, flow tested. The test failed to produce gas in commercial quantities. Potential gas zones up-hole are currently being evaluated by the participants for testing. Index has a 10% WI and an 8% WI after payout ("APO") of the prospect. Index has a 6% NRI APO.
Index recently reported ongoing operations on the George Cason 1, Shadyside 1, and Outlar 1 high impact, FY 2008 exploration wells in Nacogdoches County, Texas, St Mary Parish Louisiana, and Wharton County, Texas, respectively. See recent Index press releases for details. All three wells are progressing as planned in terms of depth verses number of days drilling and cumulative cost.
PLANNED FISCAL YEAR 2008 WELLS
Index continues to manage its exploration business using industry best practices and a balanced portfolio approach with increasing emphasis on high-impact wells.
Wells awaiting spud in the current fiscal year are the low-risk Cow Trap production well in Brazoria County, Texas; the high-impact well in the Supple Jack Creek area of Lavaca County, Texas; and the very high-impact well in the Alligator Bayou area of Matagorda County, Texas.
In Kansas, Index has signed 14 well AFEs ("Authorizations for Expenditure") for low-risk oil prospects in Stafford and Barton Counties, Kansas. It is anticipated that drilling in Kansas will begin in third quarter 2007 with up to 14 wells to be drilled at a rate of approximately two wells per month. The number of wells to be drilled in Kansas is dependent upon oil price and results of the early wells to be drilled.
Lyndon West, CEO of Index Oil and Gas, stated, "This is the highest level of activity the Company has seen to date. Index management believes it has assembled a well balanced portfolio of risk-mitigated prospects that will potentially impact the Company very positively as our fiscal year 2008 progresses."
To find out more about Index Oil and Gas Inc. (OTCBB:IXOG), visit our website at www.indexoil.com. A presentation reviewing the Company's current portfolio can be found here.
The statements in the press release that relate to the Company's expectations with regard to the future impact on the Company's results from acquisitions or actions in development are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The statements in this document may also contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, such statements should not be regarded as a representation by the Company, or any other person, that such forward-looking statements will be achieved. Since the information may contain statements that involve risk and uncertainties and are subject to change at any time, the Company's actual results may differ materially from expected results. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. In light of the foregoing, readers are cautioned not to place undue reliance on such forward-looking statements.
Pursuant to a June 1, 2007 agreement, Consulting For Strategic Growth 1, Ltd. ("CFSG1") provides the Company with consulting, business advisory, investor relations, public relations and corporate development service, for which CFSG1 receives cash and/or stock compensation.