VHGI Energy plans drilling campaign in Tennessee's Cumberland Plateau

Source: VHGI Energy

VHGI Holdings, Inc. (OTC:VHGI) and VHGI Energy, LLC, its wholly-owned operating subsidiary, plan begin a drilling program in Tennessee’s Cumberland Plateau. 

VHGI Energy has entered into an agreement with Outdoor Resources of Crossville, TN to drill its initial well within the next 120 days. They plan an additional four wells as quickly as possible upon successful completion of this initial effort. The wells are to be located in the "Upper Cumberland Region" of north central Tennessee (Morgan, Fentress and/or Scott Counties). 

The plan is for a shallow drilling program with a target of the Monteagle formation (750'); traditionally Tennessee's top gas and oil producing formation. The Monteagle is the most wide spread oil and gas producing formation in the Cumberland Plateau. 

"We have been working on entry level drilling programs for the past year and believe this is the right place to invest this start-up capital," said Eric Leonetti, VHGI VP/COO. 

This is a single well "Turnkey" drilling agreement allowing VHGI Energy, LLC a 65% "Over Riding Royalty" while Outdoor Resources, Inc. and the land owners will hold the remaining interest. Outdoor Resources, Inc. will hold 100% of the "Working Interest". VHGI Energy, LLC has retained the right to acquire up to an additional four wells upon completion of this initial effort. The "Turnkey" drilling costs are to be $150,000.00 per well.

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