U.S. Energy Corp. Enters Into Second Eagle Ford Participation Agreement With Crimson Exploration Inc.

U.S. Energy Corp. USEG announced today that it has entered into a second participation agreement with Crimson Exploration Inc. CXPO to acquire an interest in an Eagle Ford oil prospect and associated leases located in Zavala and Dimmit Counties, Texas. Under the terms of the agreement, USE will acquire 30% of Crimson's working interest (~23% net revenue interest) in approximately 7,186 acres (2,156 acres net to USE). All of the leases are currently held by production and produce approximately 200 gross BOE/D (46 net BOE/D) from the Austin Chalk formation. It is estimated that under current spacing there is a potential for up to 44 gross (13.5 net) drilling locations on the acreage. All drilling and leasing on this prospect will be on a heads up basis. This acquisition brings USE's total acreage in the Eagle Ford to approximately 11,861 gross acres (3,558.5 acres net to USE) with the potential for up to 70 gross and 21.3 net Eagle Ford drilling locations. The prospect also has additional Austin Chalk and Buda formation production potential. For competitive reasons, the financial terms of the transaction will not be disclosed at this time.