FIELD ACTIVITIES / American Energy Group: Company Update
OTC Bulletin Board SYMBOL: AMEL
MAY 26, 1998
ISLAMABAD, PAKISTAN--Hycarbex, Inc., a wholly owned subsidiary of
The American Energy Group Ltd. today announced preliminary results
of its first Middle Indus Basin exploratory well in central
Pakistan.
The well, Kharnhak No. 1, was spudded on March 15th, 1998, and was
drilled to total depth on May 12, 1998. The well ceased drilling
in the Chiltan Limestone of the Upper Jurassic formation at 8,250
feet, and had encountered gas shows throughout a 700 foot section
identified by paleotologist reports as the Sui Main Limestone and
a 260 foot section identified as the Pab Ranikot Sandstone. As a
result of log analysis, core analysis, and the gas shows
encountered, the company conducted drillstem tests in the Sui Main
Limestone. The drillstem test of the Sui Main Limestone at
approximately 3,900 feet produced natural gas and formation water,
and pressure tests indicated downhole flowing pressure of 1750
psi. Chromatograph readings taken from gas samples at the surface
indicated a high quality gas with no CO2 or H2S detected. A
successful flare test was conducted at the surface during the
drilling test. Casing has been set to a depth of 7,500 feet,
operations have been suspended, and the drilling rig has been
released. The commerciality of this well and the Sui Main
geological structure will be determined by further evaluation and
analysis by the company and the Government of Pakistan.
Based upon these results and the intent to evaluate other
potentially productive formations and structures, the company will
hold an Operating Committee Meeting, which is comprised of the
working interest owners (in this case, the company and the
Government of Pakistan) in Islamabad to extend its Exploration
License on the Jacobabad Concession for one year and commit to
drill another well to evaluate the Sui Main and Pab formations by
April, 1999. The next well is anticipated to be drilled to a
maximum depth of 5,000 feet.
Having completed its three years of work requirements and initial
License term, the company, per the provisions of its Exploration
License, will relinquish 20 percent of the acerage originally held
under the Concession, thereby retaining approximately one million
acres for further exploration and development. The relinquished
acreage is not part of the potentially productive structure to be
evaluated by the company on the Jacobabad Concession.
The American Energy Group Ltd. is an independent oil and gas
exploration, drilling and production company based in Houston,
involved with both domestic and international exploration
projects.
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