Hemi Energy Group closes acquisition of additional 45 oil wells
  by: OilOnline
  Friday, September 22, 2006

Hemi Energy Group Inc. recently consummated the purchase of an additional 45 oil wells and 2 injection wells on the Orth-Reno, Orth-Silvey and Bennett Leases. The leases were acquired on cash terms from Inlan Oceans LLC of Galena, Kansas. The acquisition gives Hemi 100% working interest (net revenue interest of 80%) on all lease acreage and wells.

The acquired lease acreage and wells are located in Woodson County, Kansas, comprised in excess of 1000 acres located adjacent to Hemi's current Purcell, Tebbens and Zimmerman leases. This acquisition gives the company 103 existing production and injection wells covering over three square miles of contiguous Enhanced Oil Recovery (EOR) operations. Production is from the Humboldt Chanute oil field comprised of Mississippian era (squirrel) sand stone formations located at intervals at less than 1000 feet of total depth. Since the acquisition, company and contract field crews have been repairing and reinstalling lease infrastructure, test pumping, rehabilitating wells and establishing a baseline production for the leases and each individual well. The company expects to have the leases online and in full production within the next 30 working days depending on variables such as weather and equipment availability.

Additionally, preliminary geological studies conducted and identified by Tectonic Energy Consultants have identified the same geological markers and trends identified outside the known boundaries of the 150,000-acre Humboldt-Chanute field. Following the Tectonic recommendations, we have begun leasing undeveloped or unexplored acreage following this newly identified trend. This additional leasing program is intended to be developmental drilling program, scheduled to commence next spring.