DENVER, CO--(Marketwired - May 15, 2014) - 1st NRG Corp. (OTC Pink: FNRC) (PINKSHEETS: FNRC) is an exploration and production company currently engaged in the development of natural gas producing properties in the Powder River Basin of Wyoming. Headquartered in Denver Colorado, our focus has been centered on our coal bed methane reserves where we hold a working interest in 42 producing wells, 8 permitted locations and 3,300 undeveloped acres. The Company is expanding its activities into one of North America's most exciting shale plays participating in a development of prospective acreage in SE Ohio encompassing approximately 7,000 acres.
The United States natural gas stocks are currently 982 BCF behind the historical five year average for storage levels and according to the EIA figures, in 2013 the United States averaged a withdrawal of 1.5 bcf/d for the year. Also in 2013, seasonal injections averaged approximately 9.5 bcf/d. So, in order to return to the five year average storage levels during this injection season, the United States needs to inject an additional 4.5 bcf/d for an average total injection rate of 15 bcf/. Currently the United States produces approximately 67.7 bcf/d and according to the EIA, natural gas consumption averaged 71.3 bcf/d in 2013. The shortfall between produced natural gas and consumption has been met historically by imports which averaged 8.5 bcf/d in 2013. What appears to be a tightening gas market is reflected in the overall price for natural gas, and more specifically in the Powder River Basin where we saw an average $1.67/mcf higher in the quarter ended March 31, 2014 when compared to the quarter one year earlier ended March 31, 2013.
At Clabaugh Ranch we have been slowing advancing toward the highly anticipated initial production from the 42-15 well drilled in December 2013. Infrastructure access issues have hampered our progress and the current operator of the field has been unresponsive to our requests and proposals. This lack of cooperation has pushed the Company to pursue other gathering, water disposal and electricity solutions. We are awaiting approval for our pending applications to use the ARID tool for water disposal, we have made arrangements for power and we are discussing our options to transport our natural gas production with three different gathering companies. The delay, while frustrating, will benefit the Company in the longer term as we will be in complete control of our expenses and operations.
In Ohio, the initial due diligence and cure periods have concluded with the Company and its operating partner purchasing the initial 40 acre drill site for the vertical test well. This well will be drilled through the Utica Shale approximately at 6,500 feet in depth. Currently land use agreements for the vertical test well and subsequent horizontal well are being completed. 1st NRG Corp holds a 20% working interest in the development and is carried in the drilling of the vertical test well.
On May 12, 2014, FINRA announced the Company's declared dividend of one Series "E" Preferred Share for each 100,000 shares of Common Stock owned by shareholders of record on April 28, 2014. The Series "E" Preferred Shares are restricted and will be convertible into Common Shares after six months if the Company has an effective registration statement in place, otherwise they are convertible into Common Shares after 12 months. The Company will need additional capital to facilitate its acquisition and development activities and as part of the Company's growth Strategy, we plan to offer a private placement of up to 1,000,000 shares or $2,500,000 of our Series "B" Preferred Shares at a price of $2.50 per share. This announcement is for informational purposes only and is not a solicitation or offer to sell the securities represented by our Series "B" Preferred Shares. The securities will be offered only to accredited investors via a written offering circular and only in jurisdictions where the sale is allowed. The Series 'B" and Series "E" share the same attributes in that a share of either is convertible into 100,000 shares of the Company's Common Stock, have liquidation rights and are non-voting.
For more information, please visit http://1stnrg-corp.com.
Forward-looking statements in this release are within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. A statement identified by the words "expects," "projects," "plans," "feels", "anticipates," and certain of the other foregoing statements may be deemed "forward-looking statements." Although 1st NRG Corp. believes the expectations reflected in such forward-looking statements are reasonable, these statements involve risks and uncertainties that may cause actual future activities and results to be materially different from those suggested or described in this press release.