Hemi Energy Group Announces New Kansas Drilling Developments
June 11 2008 - 8:40AM
Business Wire
Hemi Energy Group, Inc. (Pink Sheets: HMGP): The evaluation of the
well logs and drill cutting samples from the new well on the
Weseloh lease in Woodson County, Kansas has shown excellent oil
shows from multiple pay zones. This virgin lease's new oil well
clearly has the important natural gas in water solution drive. This
will be a very good producing well, based on the opinions and
experience of industry professionals, after it is fraced and other
completion techniques are finalized by next week. This is our first
drilled new well on a virgin lease and therefore will have a much
longer lasting production and at a higher rate than wells that are
drilled on leases with mature wells in southeast Kansas. Our new
oil well is along the Cherry Creek Trend and is in close proximity
to several excellent producing new oil leases of other oil
companies that are also drilling and developing along the oil
trend. These two virgin leases, the Weseloh and Driskell, have all
necessary supplies in place. The total acreage of these two leases
is comprised of approximately two square miles in the Cherry Creek
Trend, an area that is only recently being developed and producing
oil. Hemi Energy's contract driller, McPherson Drilling LLC,
expects to move to the second lease next week. The Driskell lease
is also in the Cherry Creek Trend, which we believe is an extension
of blanket formations, in Woodson County, Kansas. We plan to
complete the drilling and cementing in the next two weeks of the
new well on the Driskell lease. Hemi's new oil well on the Weseloh
lease has also identified five coal bed layers. All of these coal
bed layers lie on top of the Bourbon Arch, which is a geological
feature approximately forty miles long. This new well's coal bed
layers are very similar to coal bed layers that are found
approximately five miles away in our five mature leases with oil
production. Therefore, a logical geological conclusion is beginning
to be confirmed that the coal beds and economically produceable
methane gas exist between our two groups of leases in southeast
Kansas. It is well documented in southeast Kansas that blanket
geological formations are common, especially in CBM pay zones.
Neither Hemi nor Hemi's management have sold any shares in 2008 to
the stock market and no market makers have been selling on the
behalf of Hemi. Therefore, it continues to be Hemi's opinion that
after hours postings are not shares being sold in volume but are
predominately reporting of transactions of sales made during the
day. Hemi continues to be cash flow positive and has more than
sufficient funds to complete the three oil wells being developed in
Kansas, and therefore has no need to sell shares to fund normal
daily operations. Hemi's artificially low market cap is
substantially below book value based on conservative oil and gas
industry standards, especially when the expected oil production
from the three new oil wells in Kansas are factored in near term.
Hemi Energy Group is an independent crude oil and natural gas
producer employing a unique business model capitalizing on
technological advances to exploit mature fields with millions of
barrels of proven oil remaining in the ground. Using attractive
lease/royalty packages Hemi has secured, in its history tens of
thousands of acres of productive domestic projects. The company's
forward-thinking strategy has placed it in an enviable position at
a time when prices and global demand for oil continue to rise.
"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995 Statements in this press release relating to
plans, strategies, economic performance and trends, projections of
results of specific activities or investments, and other statements
that are not descriptions of historical facts may be
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995, Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. Forward-looking information is inherently subject to
risks and uncertainties, and actual results could differ materially
from those currently anticipated due to a number of factors, which
include, but are not limited to, risk factors inherent in doing
business. Forward-looking statements may be identified by terms
such as "may," "will," "should," "could," "expects," "plans,"
"intends," "anticipates," "believes," "estimates," "predicts,"
"forecasts," "potential," or "continue," or similar terms or the
negative of these terms. Although we believe that the expectations
reflected in the forward-looking statements are reasonable, we
cannot guarantee future results, levels of activity, performance or
achievements. The Company has no obligation to update these
forward-looking statements. For additional information please go to
http://hemienergy.com.
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