1st NRG Corp. provides an update on the company’s operations.
Utica Shale – Eastern Ohio
The Company has entered into a Letter of Intent to develop approximately 7,150 acres in Eastern Ohio, one of the most active areas for oil, natural gas and natural gas liquids exploration in the United States. Recently the Ohio Department of Natural Resources released estimates of the possible Utica-Point Pleasant recoverable reserve potential in Ohio to be between 3.75 to 15.7 trillion cubic feet of natural gas and 1.3 to 5.5 billion barrels of oil. According to Aubrey McClendon, CEO of Chesapeake Energy, which owns the largest leasehold in Ohio, “This is the best treasure of American energy,” McClendon said on CNBC’s Mad Money hosted by Jim Cramer.
Niobrara Shale – Western Nebraska
The Company also has entered into an agreement which will deliver an Oil and Gas Lease and surface use agreement for 1,370 acres located in Banner County Nebraska. We expect the area to have possibilities to develop the Niobrara Shale which is being compared to the Bakken Shale in North Dakota. Located in the Denver Julesburg Basin which extends from Southeast Wyoming and Southwest Nebraska into Northeast Colorado, the acreage will provide the company with possible oil, natural gas and natural gas liquids development in the Niobrara Shale, as well as the Codell, Greenhorn, D and J Sands. Industry estimates of the possible Niobrara Original Oil in Place (OOIP) are 30 million BOE per section; however recoverable oil, natural gas and natural gas liquids will vary by area, thickness, porosity and fracture systems.
CBM – Northern Wyoming
Clabaugh Ranch - Clabaugh Ranch was acquired in October 2010 and consists of various working interests in forty-two producing coal bed methane (CBM) wells. Coal bed methane is a source of clean natural gas. Along with the forty-two (1.22 net) drilled and producing wells, the Company holds an interest in eight (6.00 net) permitted locations which we intend to drill in the fourth quarter 2012. The field currently produces 1,200 – 1,300 MCFD and we estimate our reserves to be about 4.8 BCF (3P).