American Noble Gas Provides Drilling Update on Initial Exploratory Well to Explore and Develop Natural Gas, Helium and Brine Minerals in the Hugoton Field

Rhea-AI Summary

American Noble Gas, Inc. (OTC-QB: IFNY) has announced promising results from its exploratory drilling in the Hugoton Gas Field, Kansas. The initial well, in which AMGAS holds a 40% stake, has identified two zones with significant potential for natural gas and helium reserves. The company plans to complete the well in two phases, starting in May 2022. The venture aims to revitalize this historically significant gas field, known for its helium reserves, which are crucial given the global shortage. The company will update shareholders on production rates and gas percentages as progress continues.

Positive

• Discovery of two potential zones with significant natural gas and helium reserves.
• Exploration may reinvigorate the Hugoton Gas Field, the largest onshore field in North America.
• Company's first production well is set for completion, increasing production capacity.

Negative

• Dependence on favorable weather and availability of resources could delay progress.
• Uncertainty regarding the actual recoverability of the identified gas reserves.

Initial Exploratory Well Reveals Encouraging Results for Natural Gas and Helium Reserves Inside the Hugoton Gas Field in Haskell and Finney Counties, Kansas.

Lenexa, KS, May 17, 2022 (GLOBE NEWSWIRE) -- American Noble Gas, Inc. (OTC-QB: IFNY) (“AMGAS” or the “Company”) is pleased to provide an update on its drilling operations regarding AMGAS’s participation in its previously announced farm-out agreement (the “Hugoton Farm-out Venture”) to develop its oil and gas and brine interests in the Hugoton Field in Haskell and Finney Counties Kansas. These exploratory drilling operations are designed to reveal important data on previously untapped gas in-place reserves of natural gas and helium gas. If successful, our exploration program may indicate the discovery of substantial new reserves within the Hugoton Gas Field which will reinvigorate the Hugoton Gas Field, the largest conventional onshore natural gas and helium field in North America.

The initial well in which AMGAS has acquired a 40% participation together with three other venture partners and was spud on May 7, 2022 has identified at least two potential zones with substantial potential gas and helium reserves. One of the zones of particular interest revealed a gas show across it. This particular zone was below previous completion attempts in a neighboring well and the completion logs of the zone revealed indications of permeability. The other zone that was previously completed in a neighboring well appeared to release gas while drilling indicating that gas reserve potential exists. 

The Company's first production well has been drilled, logged and production casing set and is currently awaiting completion activities. The well completion is estimated to begin in May and will be completed in 2 phases. The lower zone will be completed and produced. The upper zones will subsequently be completed and then co-mingled. Electricity and pipeline infrastructure are currently being prepared to connect the new well to produce the potential methane and helium gases and for disposal of produced water.

AMGAS and its Venture partners will complete the well as expeditiously as possible subject to potential adverse weather and the availability of raw materials and oil and gas service companies. The Company will apprise shareholders of its progress including the release of appropriate initial production rates and the natural gas and helium percentages.

Management commentary:

Stanton E. Ross, Chairman and Chief Executive Officer of AMGAS remarked that “the Hugoton Farm-out Venture of which we are a 40% participant, exploratory drilling program has started off very well with encouraging test results from its initial well. The Hugoton Gas Field has previously been considered a depleted conventional gas field but our exploratory well results may serve to reinvigorate the entire Hugoton Gas Field. The Hugoton Farm-Out Venture sees the logic of its unconventional theories and the potential impact it may have, in particular the helium reserves that the field may still contain”, commented Stan Ross, Chairman and CEO. He further stated, "The Hugoton Farm-Out Venture has the contractual rights to explore and develop natural gas, helium and other noble gases as well as brine minerals contained inside the Hugoton Gas Field in Haskell and Finney Counties, Kansas.

The Company’s newly appointed advisory board and our service agreement with US Noble Gas, pairs us with specialists who can provide invaluable help to the Hugoton Gas Field Venture for developing its reserves of helium and brine minerals. “The world is currently facing a well-publicized shortage of helium and the world needs helium”, added Mr. Ross, “The Hugoton Gas Field Venture may have just discovered new gas and helium reserves contained inside the Hugoton Gas Field in Haskell and Finney Counties, Kansas that may help alleviate the shortage of those gases, further we remain keenly interested in the brine mineral potential." concluded Mr. Ross.

About the Hugoton Gas Field:

The Hugoton Gas Field is a prolific natural gas and helium gas field located in the States of Kansas, Oklahoma, and Texas. Its name is derived from the town of Hugoton Kansas near which the Hugoton Field was first discovered. Natural gas in the Hugoton gas field was first discovered in 1919 near Liberal, Kansas at a depth of 2,919 feet below surface but was shut-in for three years because it did not find oil. In 1922 the well was completed as a gas well, but there was little demand for natural gas in the area and it was years before another gas well was drilled in the field.

In 1927, gas was discovered at about 2,600 feet below the surface southwest of Hugoton, Kansas which is now considered the center of the Hugoton Field. By the end of 1928, five wells had been drilled in the field and the first pipeline was transporting gas to local markets.

In 2007, the Hugoton gas area produced 358 billion cubic feet of gas, making it the 5th largest source of natural gas in the United States. The Hugoton currently (2022) ranks second in cumulative natural gas production and eighth in estimated total reserves globally.

The natural gas in the Hugoton field of Kansas and Oklahoma, plus the Panhandle Field of Texas, contains unusually high concentrations of helium, from 0.3% to 1.9%. Because of the large-size of these fields, it is recognized to contain the largest reserves of helium in the United States. Helium is separated out as a byproduct from natural gas, from the Hugoton field, the Panhandle field in Texas, the Greenwood field in Kansas, and the Keyes field in Oklahoma.

About American Noble Gas, Inc.:

AMGAS has recently acquired current oil & gas production and the mineral rights to approximately 11,000 acres in the Otis/Albert Field located on the Kansas Central Uplift. Prior to the recent acquisition, AMGAS had been involved in oil and gas exploration, development and production of natural gas and oil in Texas and the Rocky Mountain region of the United States as well as an oil field service company located in Eastern Kansas, Northern Oklahoma, Colorado and Wyoming prior to December 2012. AMGAS was founded in 1987, is headquartered in Lenexa, Kansas and its common stock is listed on the OTC-QB under the symbol "IFNY". The Company's financial statements and additional information are available on the Internet at www.otcmarkets.com.

Forward-Looking Statement:

This press release includes statements that may constitute "forward-looking" statements, usually containing the words "believe", "estimate", "project", "expect" or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Forward-looking statements in this press release include the following: whether the Company will be successful in exploring for noble gases including developing commercially efficient production of its noble gas reserves, developing the oil & gas reserves of the Oil & Gas Properties; whether the TORP Agreement will provide the desired beneficial engineering and development data to increase production of oil & gas from the Oil & Gas Properties, whether the Company will be successful in workover/stimulation activities of existing producing oil & gas wells that result in increased production of the Properties; whether the Company will be able to execute its exploration and development plans for the Properties, including obtaining the required financing; whether the required financing for the exploration & development of the Properties can be obtained on terms favorable to the Company and its shareholders; the quantity of hydrocarbons beneath the Properties and whether they can be economically extracted; the accuracy of the consultants' preliminary analysis and estimate of the recoverable oil & gas reserves (including noble gas reserves) on the Properties and their underlying assumptions; whether or to what extent the relevant geological zone contains hydrocarbons and/or noble gas; the inability to predict, in advance of drilling and testing, whether any particular prospect will yield oil in sufficient quantities to recover drilling and/or completion costs or to be economically viable; the fact that the process of estimating the quantity of oil in a prospect is complex, requiring the interpretation of available technical data and many assumptions; the potential for significant inaccuracies in such interpretations and assumptions that could materially affect the Company's estimates or those of its consultants; the necessity for estimates to be based upon available geological, geophysical and engineering data that can vary in quality and reliability; the inherent lack of precision in estimates involving the quantity of oil and noble gases in the development project in Kansas as a result of the foregoing; whether the Company will be successful in exploring for the existence of mineral reserves other than oil & gas in commercial quantities including the development of the underlying reserves of such reserves and its ability to find a qualified partner, if necessary, with whom to pursue its exploration and development program on terms and conditions acceptable to the Company; the Company's ability to extract oil and gas from the Properties and the costs and technical and other challenges of extracting oil from the Properties; variations in the prices of oil and gas, unexpected negative geological variances, governmental uncertainties in Kansas; operating risks, delays and problems, the availability of services on acceptable terms, the results of drilling and completions; changes United States regulation respecting oil and gas; and actions by creditors with respect to debt or other financial obligations of the Company; and its ability to resolve its liquidity and capital requirements. Additional information respecting factors that could materially affect the Company and its operations are contained in its annual report on Form 10-K for the year ended December 31, 2021 and its Form 10-Q for the three months ended March 31, 2022 as filed with the Securities and Exchange Commission.

For Additional Information, Please Contact:

Stanton E. Ross, CEO, at 816-955-0532

FAQ

What are the results of the initial exploratory well by American Noble Gas?

The initial exploratory well has identified two zones likely containing significant natural gas and helium reserves.

What percentage of the Hugoton Farm-out Venture does American Noble Gas own?

American Noble Gas holds a 40% ownership stake in the Hugoton Farm-out Venture.

When is the completion of the well expected to start for IFNY?

Well completion activities are anticipated to commence in May 2022.

What is the significance of the Hugoton Gas Field for helium reserves?

The Hugoton Gas Field is recognized for containing some of the largest helium reserves in the United States.

What challenges might American Noble Gas face in its exploration efforts?

Challenges include potential delays due to adverse weather and resource availability.