HOUSTON, June 3, 2009 (GLOBE NEWSWIRE) -- Lucas Energy, Inc. (NYSE Amex:LEI) an independent oil and gas company based in Houston, Texas, today reports that the Griffin Oil Unit No. 2 well has surpassed its expectations.
Lucas Energy, Inc. purchased a shut in well (Griffin Oil Unit No. 2) in June 2006 from a local oil producer operating several wells in Gonzales County, Texas. The cost of the acquisition was $15,000. The Company invested another $120,000 in a pumping unit, tubing and rods, and workover expenses to put the well back on production. Since putting the well back on in July 2006, the well has made more than 33,000 bbls of oil from the Austin Chalk formation.
The Griffin Oil Unit No. 2 well was originally drilled and completed in January 1991. The well produced more than 280,000 bbls of oil prior to being shut in in the year 2000. Several attempts were made to restore production after that without success. Lucas Energy, Inc. acquired the well bore and unit leasehold rights in 2006 and restored production. The first year, the well made more than 12,000 bbls of oil.
To date, the well has grossed more than $1.8 million to the Company's interest; and Lucas has netted $1.3 million after capital and lease operating expenses. Lucas Energy, Inc. owns 100% of the working interest in the well. Production taxes are abated due to a shut in tax exemption which Lucas received from the State of Texas.
Mr. William A. Sawyer, President and CEO of Lucas Energy, said "This is the type of business plan that we have endeavored to follow; re-establishing production in shut in wells. This particular well has been exceptional. We hope to find others like it."
About Lucas Energy
Lucas Energy, Inc. (NYSE Amex:LEI) is a Houston, Texas based independent crude oil and gas company that identifies, evaluates and acquires leasehold property interests, primarily in the Austin Chalk formation of South Texas, Southeast of San Antonio, that are underperforming or have been shut-in or plugged and abandoned. These properties are then revitalized by undertaking extensive re-entry and work-over procedures, including clean-up, repairs and treatments of the existing well bores and lateral extensions, as well as extending or drilling new laterals into previously nonproducing areas of the formation. By utilizing tight field and operating management controls, together with having a comprehensive understanding of the production characteristics of the Austin Chalk, the Company believes that it can increase reserves, improve production and maximize cash flow while avoiding most of the high risks of typical exploration projects.
The Company's headquarters are located at 6800 West Loop South, Suite 415, Bellaire (a suburb of Houston), Texas 77401.
The Lucas Energy logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4192
Forward-Looking Statement
This Press Release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. A statement identified by the words "expects," "projects," "plans," "feels," "anticipates" and certain of the other foregoing statements may be deemed "forward-looking statements." Although Lucas Energy believes that the expectations reflected in such forward-looking statements are reasonable, these statements involve risks and uncertainties that may cause actual future activities and results to be materially different from those suggested or described in this press release. These include risks inherent in the drilling of oil and natural gas wells, including risks of fire, explosion, blowout, pipe failure, casing collapse, unusual or unexpected formation pressures, environmental hazards, and other operating and production risks inherent in oil and natural gas drilling and production activities, which may temporarily or permanently reduce production or cause initial production or test results to not be indicative of future well performance or delay the timing of sales or completion of drilling operations; risks with respect to oil and natural gas prices, a material decline in which could cause the Company to delay or suspend planned drilling operations or reduce production levels; and risks relating to the availability of capital to fund drilling operations that can be adversely affected by adverse drilling results, production declines and declines in oil and gas prices and other risk factors. The Company's complete filings with the Securities and Exchange Commission are available at http://www.sec.gov