Allied Energy has commenced drilling operations at its first horizontal well in Leon County, Texas.

The company plans to drill about 7,000ft vertical and approximately 4,000ft horizontal to test the oil bearing Woodbine Formation utilizing new and evolving fracture stimulation methodologies.

Over the last year, there have been a series of horizontal Woodbine wells on trend, which were drilled and completed for production.

Allied Energy plans to mimic the most prolific wells in the play, which utilize the combination of horizontal laterals with multi-stage hydraulic fracture treatments.

The ability to drill horizontal laterals and apply multi-stage treatments to the Woodbine Formation has created what appears to be a growing trend of horizontal drilling activity in the regional area of the East Texas Basin, the company said.

In Grimes County, the Allied operating Howard #2H well was recently drilled to a total measured depth of approximately 18,000′ along existing trends.

This well is a horizontal lateral that encountered a series of natural gas bearing intervals while drilling through the primary objective Buda/Georgetown Limestone Formation.

On December 12, 2010, Howard #2H tested at a rate of approximately 4,000mcfgd with associated condensate.

It is anticipated that the well will initially produce at a sales of about 2,000mcfgd equivalent and potentially higher in the future.

The company is currently constructing production facilities, gas flow lines, processing facilities and other necessary surface equipment in preparation to begin its ongoing production operations.

On 15 May 2010, Allied Energy’s first horizontal location in Grimes County, the Howard #1H well, tested at a flowing rate of 4,011mcfgd with associated condensate.

Allied Energy is primarily engaged in the exploration, development and production of oil and natural gas in the continental US.