Southern Star Provides Operational Update
Southern Star Energy Inc., September 26th, 2007 (OTCBB: SSEY) is pleased to provide an operational update the company’s prospect in North Louisiana.
Operational update:
Southern Star Energy is pleased to announce that they have successfully drilled three evaluation wells and are currently drilling a fourth test well in their North Louisiana prospect acreage. Early evaluation and test results indicate that the deepest and primary hydrocarbon objective reservoirs, in the Cotton Valley sandstone interval, contain thirty percent to fifty percent (30% to 50%) more oil and gas reserves than previous internal forecasts had indicated. In addition, secondary and tertiary oil and gas reservoir targets known to be productive in offset area fields have been indicated by sidewall cores and wireline log measurements to have potential in these new Company wells. Over the last ten months, the Company has been able to drill four wells, simultaneously obtain right of ways, and build a new flow line to market the gas. These activities will allow the Company to significantly expedite future field development. Based on similar offset area field developments and the encouraging results of these early Company wells, which are drilled about two thirds of a mile to nearly one mile apart, the Company’s prospect acreage could experience the drilling of 80 development wells.
Company’s Activities:
Atkins-Lincoln 18-1: Drilled and completed January 16, 2007 to depth of 9950 feet. First production July 11, 2007. First sales September 5, 2007, currently only the bottom 14% of total Cotton Valley pay interval is being produced. The Company intends to further its completion activities on this well and complete the entire Cotton Valley section in October 2007.
All of the estimated recoverable oil and gas reserves in four different zones are confirmed by mudlog, wireline logs and in some cases with sidewall cores and Formation Tester pressure measurements. Total of 85 feet estimated gas pay in the Cotton Valley. The three shallower zones demonstrating primarily oil potential will continue to be evaluated in subsequent wells.
R. C. Atkins 8-1: Drilled and completed February 24, 2007 to depth of 9950 feet. Completion for first production set for September 27, 2007. First sales planned for October 20, 2007 following the completion of entire Cotton Valley section.
All of the estimated recoverable oil and gas reserves in the Cotton Valley zones are confirmed by mudlog, and wireline logs. Total of 64 feet estimated gas pay in the Cotton Valley.
Pipeline/Gas gathering system: Right of ways were obtained and two and a quarter miles of pipeline were installed in June 2007. Gas gathering system and facilities installed and hooked up September 2007.
Atkins-Lincoln 18-2: The Company spudded this well on September 14, 2007 the Company anticipates reaching TD before September 30, 2007. Numerous mudlog gas “breaks” indicate and correlate to hydrocarbon bearing zones present in the previous wells recently drilled about two thirds mile to a mile away.
Rendall 7-1: Drilled and completed July 24, 2007 to depth of 5000 feet. Completion for production attempted on three zones. Produced hydrocarbon shows were experienced in the zone around 4900′ but not in the zones at 3830′ or 1000′. All zones remain as “zones of interest” and will be evaluated further in future wells to be drilled.
All of the estimated recoverable oil and gas reserves in three different zones were indicated by mudlog, wireline logs and in some cases with sidewall cores and Formation Tester pressure measurements in the two previously drilled wells, additionally indicated by wireline logs and sidewall cores in this wells.
Further Information:
Shareholders and prospective investors are encouraged to visit Southern Star Energy’s website: www.ssenergyinc.com to learn more about the Company and the Cotton Valley Trend. Please feel free to call investor relations at 1-800-733-2447 ext. 107 to receive a full corporate investor package.
About Southern Star Energy:
Southern Star Energy has approximately 5500 acres under lease within the prospect area, which is defined by a string of ten vintage wells drilled in the 1950′s. The prospect area was historically developed on 640 acre spacing (wells approximately one mile apart). Most of these old wells were abandoned before 1972 after only producing from one of the Cotton Valley sand members. None of the zones with identified reserve potential has been produced within the prospect area. Preliminary plans, with continued successful evaluation drilling, will be to develop the leased acreage with at least one well per 160 acres. Analog fields are being economically developed with at least one well per 80 acres.
Information Regarding Forward-Looking Statements:
Except for historical information contained herein, the statements in this Press Release are forward-looking statements that are made pursuant to the safe harbor provisions in the Private Securities Legislation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause Southern Star Energy’s actual results in future periods to differ materially from forecasted results. These risks and uncertainties include, among other things: volatility of natural resource prices; product demand; market competition and risks inherent in Southern Star Energy’s operations.