SOURCE: Victory Energy

Victory Energy

June 29, 2011 10:00 ET

Victory Energy Announces Successful Completion of Tunis Creek Well

Oil Reserve Estimates Exceed Expectations; Second Well Location Being Evaluated

NEWPORT BEACH, CA--(Marketwire - Jun 29, 2011) - Victory Energy Corporation (PINKSHEETS: VYEY), through its partnership with Aurora Energy Partners, today announced the successful completion of its Tunis Creek Oil and Gas Prospect in Pecos County, Texas. The University "6" #1 Tunis Creek well was spud on April 22, 2011 and was completed in the Ellenburger formation on Friday, June 24, 2011.

Very preliminary testing of the Ellenburger formation indicates that oil reserves could exceed earlier estimates. Pre-drilling internal total prospect reserve estimates exceeded 500,000 barrels. These preliminary flow tests on the University "6" #1 Tunis Creek well were performed using its natural bottom-hole pressure and was limited to the lower 20 percent of the Ellenburger formation in the wellbore. Sustained flow tests to evaluate bottom-hole pressure and to develop optimal flow rates for this well should occur over the next thirty days. Storage tanks are scheduled to be installed this week with oil sales to market occurring shortly thereafter. Associated natural gas testing has not yet occurred. A natural gas delivery pipeline is nearby.

Based on the positive results of this first well and the previously identified multiple oil and gas pay zones above this producing formation, the company will immediately begin evaluating locations for a second well on the acreage. Several additional development wells may be drilled if production warrants. Field rules established by the State of Texas will determine the exact number of wells.

Robert Miranda, Victory Energy's chairman and CEO, stated, "These preliminary completion results are outstanding and offer the first sizable validation of our ability to use our extensive network of oil and gas contacts to deliver immediate value to our shareholders. Wells of this quality and with reserves of this size are not typically available to micro-cap companies like Victory Energy. The additional development drilling opportunities available on the Tunis acreage could afford us at least two additional years of drilling at this location."

Victory Energy, through its partnership with Aurora Energy Partners, holds a 5 percent working interest and a 3.75 percent net revenue interest in this oil focused prospect.

About the Tunis Creek Prospect
The company acquired its interest in the prospect from well-known Midland, Texas based V-F Petroleum Inc., who is also the operator of the well. The University "6" #1 Tunis Creek well is located twenty-five miles due east of Fort Stockton, Texas, in eastern Pecos County, and is surrounded by significant hydrocarbon shows in all targeted horizons.

Just over two thirds of a mile to the east-northeast in the same section, Midwest Oil opened the one-well Renaud & Tunstill field. That Midwest Oil well (1 University) is down dip of the Tunis Creek well and was completed in 1960. The 1 University well flowed 248 barrels of 43-degree oil per day from the Ellenburger formation at 6,810-95 feet and 1.65 million cubic feet of casinghead gas.

The prospect area is within the Central Basin Platform of the prolific Permian Basin and is located up dip of a previously producing oil and gas well. Hydrocarbon delivery infrastructure is nearby, including a natural gas pipeline. The 1,600 acre lease comprises two sections of block 20, University Lands survey.

About Victory Energy Corporation
Victory Energy Corporation is engaged in the exploration, acquisition, development, and exploitation of oil and gas properties. The company endeavors to utilize its broad range of oil and gas industry relationships to acquire small interests in a large volume of low- to moderate-risk oil and gas prospects. A cornerstone of this strategy is an emphasis on developing and maintaining relationships with proven, well established oil and gas exploration and development companies.

Prospect acquisitions are ideally weighted toward oil, although natural gas projects with high btu content, favorable above-market pricing and modest decline rates will also be targeted. Targeted prospects generally provide the company with a rapid return of capital while offering multiple well locations for additional drilling on an established trend. The model asset portfolio is geologically and geographically diversified. The company's current producing oil and gas assets are located in the United States.

For more information, please visit our website http://www.vyey.com

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
There are forward-looking statements contained in this news release. They use such words as "intend," "will," "may," "expect," "believe," "plan," or other similar terminology. These statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results to be materially different than those expressed or implied in such statements. These factors include, but are not limited to: risks associated with the implementation of the Company's strategic growth plan; legislation and government regulation including the ability to obtain satisfactory regulatory approvals; conditions beyond the Company's control such as weather, natural disasters, disease outbreaks, epidemics or pandemics impacting the Company's customer base or acts of war or terrorism; availability and cost of materials and labor; demand for natural gas; cost and availability of capital; competition; the Company's overall marketing, operational and financial performance; economic and political conditions; the continued service of the Company's executive officer; adverse developments in and increased or unforeseen legal costs related to the Company's litigation; the success of the Company's strategic partnerships and joint venture relationships; the Company's ability to pay certain debts; adoption of new, or changes in, accounting policies and practices; adverse court rulings; results of other litigation in which the company is involved; and other factors discussed from time to time in the Company's news releases, public statements and/or filings with the Securities and Exchange Commission. Forward-looking information is provided by Victory Energy Corporation pursuant to the safe harbor established under the Private Securities Litigation Reform Act of 1995 and should be evaluated in the context of these factors. In addition, the Company disclaims any intent or obligation to update these forward-looking statements.

Contact Information

  • CONTACT:
    Robert J. Miranda
    Chairman and Chief Executive Officer
    714.480.0305

    Investor Relations
    714.227.0391