Nighthawk Energy Regulatory News (HAWK)

22 May 2007 07:02

Nighthawk Energy plc22 May 2007 Nighthawk Energy plc BLM Approval for Broadhead Tap and Pipeline at Cisco Springs Project Construction of Pipeline and Engineering Works Underway The directors of Nighthawk Energy plc ("Nighthawk" or the "Company") (AIM: HAWK)are pleased to announce that the Utah division of the Bureau of Land Management("BLM"), a section of the US Department of the Interior, has granted approvalfor the construction of the Broadhead tap facility into the Northwest Pipelineand the construction of a main link pipeline at the Cisco Springs production anddevelopment project situated in Grand County, Utah. Nighthawk holds a 37.5 percent interest in the project and Running Foxes Petroleum Inc. ("Running Foxes"),a Denver-based private company, is the operator. Current natural gas production from Cisco Springs is sold and routed into theNorthwest Pipeline via a third party owned pipeline, the capacity of which islimited to approximately 1 million cubic feet of gas per day. Nighthawk andRunning Foxes are currently producing up to 700,000 cubic feet of natural gasper day. Upon completion, the new tap and compression facility will provideofftake capacity of up to 8 million cubic feet per day. The implementation of the tap and pipeline will bring numerous commercial anddevelopment benefits to the Cisco Springs project which include: • The provision of a reliable means of natural gas transportation, coupled with sufficient pipeline capacity for the planned increased production at Cisco Springs; • The eradication of third party sales tariffs; • A sales and transportation option for existing and planned wells in the acreage to the south of the US I-70 Interstate; • A reduction in wellhead flowing pressures and enhancement of both production and ultimate recovery through the new gas compression facilities; and • A strong competitive advantage for Nighthawk and Running Foxes in the Cisco Springs region. The link pipeline will run from the northwest side of Interstate 1-70 to a tappoint on the Northwest Pipeline, south of Interstate 1-70. Various contractingcompanies have commenced work on site and Polaris Drilling will bore a holeunder Interstate 1-70 and construct an eight inch pipeline to the tap. Other project related equipment has been sourced and purchased and will beinstalled at the tap facility. This equipment includes refrigeration plant,dehydration plant, pipeline and compressors. David Bramhill, Managing Director of Nighthawk commented "The approval by theBLM and the planned construction of the Broadhead tap facility and main pipelineare pivotal events in the development of the Cisco Springs project. Ourpartner, Running Foxes, has put considerable effort into obtaining the approvalincluding in the undertaking of stringent environmental and biological surveys.The implementation and completion of this work will bring major benefits toshareholders and the Company in respect of Cisco Springs." For further information please contact: Nighthawk Energy plc 01271 882160David Bramhill, Managing Director office@nighthawkenergy.netwww.nighthawkenergy.net Hanson Westhouse Limited 0113 246 2610Tim Feather tim.feather@hansonwesthouse.comMatthew Johnson matthew.johnson@hansonwesthouse.com Bishopsgate Communications Limited 020 7562 3350Dominic Barretto dominic@bishopsgatecommunications.comFran Read fran@bishopsgatecommunications.com Notes for Editors Nighthawk is a hydrocarbon production and development company focused onbuilding a portfolio of assets in the US. Nighthawk floated on AIM in March2007 having raised a total of £10 million. Nighthawk holds a 37.5 per cent. working interest in the producing Cisco Springsoil and gas project in Grand County,Utah. Running Foxes, a privately ownedDenver-based company, is the operator and majority owner of the project. At the time of Nighthawk's admission to AIM, Oilfield Production ConsultantsLimited ("OPC"), estimated the following reserves, net to Nighthawk, in theCisco Springs project: P90 P50 P10 Gas (BCF) 74.9 94.2 116.2Oil (MMBBLS) 0.3 0.6 1.1 OPC estimated the NPV10 of Nighthawk's interest in Cisco Springs to be US$192.3million (approximately £98.6 million). The Cisco Springs project area presently covers approximately 17,000 acres.There are currently 18 production wells at Cisco Springs, primarily supplyingnatural gas to the Californian market with ancillary oil production soldlocally. A major drilling and development programme is in progress with 390well sites identified on the current acreage. Approximately 60 new wells areplanned in the next two years. In addition, Nighthawk holds an 80 per cent. interest in the Vogel Bartlesvillewaterflood project in Kansas. The initial project area of 160 acres, which theoperator, Running Foxes, estimated to contain oil in place of 3.1 millionbarrels, has increased by recent acquisitions to approximately 960 acres. Aprogramme of production and injection wells is in progress to determine thereservoir characteristics in preparation for flooding the reservoir andproduction. This information is provided by RNS The company news service from the London Stock Exchange