The Investment Case
The Eblana #1 exploration well, drilled by U.S. Oil's wholly owned subsidiary Major Oil International LLC in May 2012, encountered nine large potential porous oil reservoir intervals (approx. 1,100 feet cumulative net pay) and associated high fracture zones before reaching its target depth of 8,550 feet on 26th May 2012.
Advanced well log processing and interpretation is now complete. Using a workover rig, the Company will production test the well in order to collect further data including flow rates, reservoir pressure and other information. Of the 20 potential payzones identified by the advanced well-log analysis, up to 15 will be perforated.
The Eblana #1 production wellhead has been installed. Ground operations for the workover programme on the Eblana #1 well will begin on 27th August, 2012, with production testing to commence on September 4th.
A February 2012 Competent Person's Report by Forrest Garb & Associates estimates Gross Prospective Resources of 189 MMSTB OOIP (P50) and 67 MMSTB recoverable oil based on data from the Company's pre-December 2011 lease area.
US OIL’s geological, geochemical and passive 2-D and 3-D seismic surveys show five precisely located hydrocarbon reservoirs, and the company has identified its first drilling targets.
US Oil & Gas has less than 42 million shares in issue.
US Oil is fully funded to drill three wells.
US Oil’s lease area is close to Railroad Valley (10 miles), which has produced over 50 million barrels.
The company anticipates working with Forrest Garb & Associates as independent processes and data auditors throughout the forthcoming drilling campaign. Their role will also include devising and maintaining the Company's data store.
The unit cost of extracting oil in Nevada is amongst the lowest anywhere. The Hot Creek Valley lease area is close to a highway and two refineries. As a result, the viability of the field is minimally sensitive to the oil price.
A discovery in the US, the world’s largest oil market, would be situated in one of the most politically stable, well regulated and secure exploration areas in the world.
NOTE: OOIP figures are those estimated by Forrest A. Garb & Associates, February 2012.
