BOWLING GREEN, KY-- (OTC: AGGI.PK) November 1, 2010-- Allied Energy announced today record earnings and continued growth for the combined first, second and third quarters of 2010. The company’s unaudited financial statements are now available at www.alliedenergy.com
For the nine months ended September 30, 2010, the Company’s reported total revenue of $20.8 million, which is a 96% increase from the same period for 2009. Of this amount, for the 2010 period, $19.9 million inrevenue is turnkey drilling revenue, and $875,600 is oil and gas production revenue. During the first nine months of 2009, the Company had $10.2 million of turnkey drilling revenue and $424,800 of oil and gas production revenue.
Also for the nine months ended September 30, 2010,the Company’s earnings before income taxes (EBIT) of $5.6 million increased by 936% when compared to the Company’s earnings for the same period of 2009. Net income was $3.4 million for the first nine months of 2010 as compared with a net loss of $664,748 for the same period of 2009. The Company attributes the majority of this increase to the Company’s experienced personnel, management team, subsidiaries, progress in the field and strategic industry partners.
The Company serves as the managing general partner for a number of general and limited partnerships in oil and natural gas development. These partnerships’ aggregate oil and natural gas exploration and development costs for 2010 increased to $10.6 million from $7.7 million in 2009 as a direct result of the Company’s continued aggressive acquisition and re-investment program including but not limited to increased participation in horizontal drilling programs, sponsorship of partnerships, lease acquisitions in Central-East Texas, well reworks and completions, building of gas line infrastructure, and the formation of the Company’s wholly-owned operating companies, Allied Operating Oklahoma, LLC and Allied Operating Texas, LLC.
For the three month ended September 30, 2010, the Company’s total revenue was $10.8 million, including $10.5 million from turnkey drilling revenue and $384,600 from oil and gas production revenue. Also for the three months ended September 30, 2010, the Company’s earnings before income taxes were $5.0 million as compared with $999,600 for the same period of 2009, and the Company’s net income was $3.0 million as compared with net income of $999,599 for year-earlier period.
Earlier this spring, the Allied Operating Howard #1H, Allied’s first horizontal well, was drilled to a total measured depth of approximately 17,000 feet, including a vertical depth of approximately 12,500 feet and horizontal length of approximately 4,500 feet, in two horizontal laterals oriented northwest and southeast along existing trends. The Howard #1H encountered a series of natural gas bearing intervals while drilling through the primary objective Buda / George-town Limestone Formation.
On May 15, 2010, the Howard #1H had an initial flowingtest rate of 4,011 MCFGD on a 20/64" choke with associated condensate and has initially produced, as expected, at an estimated sales rate of~ 2,000 MCFD of gas with 25 to 30 BCPD while maintaining ~ 2250 PSI FTP.
"We are extremely pleased with the results we haveseen thus far for our horizontal programs in Grimes County, Texas and theoverall execution of our business model for the first nine months of 2010," said Steve Stengell, Allied's Chief Executive Officer.
Allied Energy, Inc. contracted Allied Gas Transmission, a majority-owned subsidiary of Allied, to trench, lay line and connect the Howard#1H to the local gas market. Allied Energy, Inc. recently signed and executed a pipeline connection agreement with Atmos Pipeline – Texas, a division of Atmos Energy Corporation, in order to sell its gas in Grimes County, Texas.
Allied Operating Texas, LLC, a wholly-owned subsidiary, was formed in 2009 for the purposes of operating and developing Allied Energy’svertical and horizontal drilling programs in Central-East Texas Basins.
At October 31, 2010, the Company, either directly or through its partnership interests, owned interests in 70 producing wells and/orwells awaiting hook-up, four wells in various stages of testing or completion, 2 wells in process of being drilled, and 20 additional wells scheduled to commence drilling on or before December 31, 2010.
No assurances can be made as to the company’s future success and/or ability to sponsor general partnerships or other oil and natural gas projects. Nor can assurances be made as it relates to present or future production rates or estimated reserves for any given project. Tremendous risks and uncertainty are associated with oil and gas drilling, completion, development and production operations. It is impossible to accurately estimate future rates and/or declines in production operations for oil, condensate and natural gas.
Although the Company has thoroughly reviewed this information, these financial statements are unaudited.
Allied Energy has achieved the “Best of Bowling Green” award for the category of crude oil and natural gas production for the last two years and was recently nominated by an independent selection committee as one of three finalists for the Bowing Green “Outstanding Business of theYear” award for 2010.
About Allied Energy
Allied Energy, Inc. (Other OTC:AGGI.PK - News) is an independent energy development firm primarily engaged in the exploration, development, and production of oil and natural gas in the continental United States. The Company relies upon its industry partners, well operators, geologists, petroleum engineers, and other operational personnel whose combined industry experience is essential to each project. Allied Energy's strategic focus is the development of oil and natural gas reserves.
For more information: www.alliedenergy.com
The financial reports herein are unaudited statements. Certain statements in this release and the attached corporate profile that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by the use of words such as "anticipate," "believe," "expect," "future," "may," "will," "would," "should," "plan," "projected," "intend," and similar expressions. Such forward-looking statements involve known and unknown risks, including but not limited to geological and geophysical risks, risks of blow-outs and other potential damaging occurrences inherent to the oil and gas industry, and uncertainties and other factors that may cause the actual results, reliance upon expert recommendations and opinions, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. The Company may have varying degrees of working interest ownership in each well and/or prospect. Thus, gross revenue projections may not be equal to what is distributed net to the Company. The Company's future operating results are dependent upon many factors, including but not limited to the following: (i) the Company's ability to obtain sufficient capital or a strategic business arrangement to fund its expansion plans; (ii) the Company’s ability to build the management and human resources and infrastructure necessary to support the growth of its business; (iii) competitive factors and developments beyond the Company's control including but not limited to the strength of the overall economy; and (iv) other risk factors inherent to the oil and gas industry.
Contact:
Company Contact:
Angela Stokes / Heather Age
Allied Energy, Inc.
2800 Griffin Dr.
Bowling Green, KY 42101
Phone: 866-256-5836
Fax: 800-251-9322
Website: http://www.alliedenergy.com
Email: info@alliedenergy.com
ALLIED HOWARS #2H DRILLING OPERATION
Source: Allied Energy, Inc.