HOUSTON, Jan. 13, 2009 (GLOBE NEWSWIRE) -- Lucas Energy, Inc. (NYSE Alternext US:LEI) ("the Company), an independent oil and gas company based in Houston, Texas, announced today its capital expenditures program for the third and fourth quarters of FY 2009 and first quarter of FY 2010.
The Company intends to re-enter seven shut-in or abandoned wells on leases presently held in its proven undeveloped property inventory in Gonzales County, Texas. Completing these Austin Chalk formation re-entries and putting the wells back into production is the Company's first priority at this time. This work will take an estimated six months, and the Company anticipates this work will increase proved developed producing (PDPs) reserves by approximately 150,000 barrels of oil recoverable.
The Company expects to complete the re-entries by the end of the first quarter of FY 2010 at a total cost of $2.0 million; approximately one-half of this represents intangible drilling costs, with the balance being equipment. In addition, the Company will finalize the acquisition of over 1,000 additional acres in Gonzales County, which will increase the proven un-developed (PUDs) reserves. The Company believes it will be able to fund the planned capital expenditures through internally generated cash flow and its bank line of credit. However, the Company's ability to fund this investment could be affected by prevailing uncertain economic and financial conditions in the oil and gas industry and the continuing volatility of crude oil and natural gas prices. Anticipated cash flows and credit availability may be adversely impacted by declining crude oil prices, which could cause a delay or scale-back in the capital expenditures or require the Company to seek other sources of additional capital.
About Lucas Energy
Lucas Energy, Inc. (AMEX:LEI) is a Houston, Texas based independent crude oil and gas company that indentifies, 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.
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