28 February, 2014 – U.S. Oil & Gas Plc.- Operations update, partnership discussions and 2014 programme


U.S. Oil & Gas Plc.

(“U.S. Oil” or the “Company”)

Operations update, partnership discussions and 2014 programme

U.S. Oil & Gas Plc (GXG London: USOP, OTC New York: USOPY), the oil and gas exploration company with assets in Nevada, is pleased to announce the completion of additional surveys of its Hot Creek Valley acreage. In addition, the company is in continuing discussions with potential industry partners.

Partnership discussions

The Company is in advanced discussions with potential investors and strategic partners about additional funding, the further development of the Hot Creek Valley asset, and other matters of potential advantage to the Company. The Company believes that good progress is being made and will report details in due course.

Surveys & modelling

Three additional surveys of the Hot Creek Valley property have been carried out. Field operations began in October 2013 and ended on 21 January, 2014. The data have now been subjected to preliminary analysis.

The surveys were:

* A large-scale reconnaissance Geochemical survey of the full Hot Creek Valley acreage.

* A Gravity Magnetic survey local to the area of the Eblana #1 well.

* A Geochemical survey local to the area of the Eblana #1 well.

The large-scale Geochemical survey was carried out to extend knowledge of the oil system already discovered and to reveal any hitherto unknown anomalies. The local surveys were intended to aid in establishing the direction of `updip’
from the Eblana #1 exploration well, to further define the discovered structure, and to map the basement topology. Surveys and associated analyses were carried out by independent specialist contractors.

Since completing the testing of the Eblana #1 well, the Company has also carried out an intensive programme of additional data analysis and geological modelling and has conducted further analyses with an independent consultancy.
The process has been time-consuming, but the Company believes it has produced an operational programme for 2014 that will maximise the chances of further exploration success (for further details, please see `2014 Programme’ below).

Large-scale reconnaissance Geochemical survey results

Preliminary results from the large-scale reconnaissance Geochemical survey of the greater lease area indicate large potential hydrocarbon seepage anomalies and multiple faults and traps.

This survey was carried out over 68 sq. kms of previously unsurveyed land, excluding inaccessible areas, and was completed in December 2013. Samples were analysed for Magnetic Susceptibility (MS), High Resolution Soil Spectral Analysis (HRSSA), and hydrocarbon content by UV-Vis Spectroscopy, Iodine, and Soil Electrical Conductivity (UMHOS). These analytical methods are independent of one another and can detect small, medium and large structural reservoirs at depth. The Magnetic Susceptibility test indicates the potential for a sample to be magnetic and has been effective in the detection of hydrocarbon seepage alteration anomalies.

Surface structure interpretation shows that the lease area appears to feature two major fault lines. The first, previously identified and the target of the Eblana #1 well, now appears to extend South to South-West of the original anomaly. The Magnetic Susceptibility alteration signature indicates multiple potential faults and traps. The second fault line, intersecting with the first, strikes East-West and is wholly contained within the lease acreage. The intersection of the two lines displays an alteration pattern considerably stronger than any pattern detected elsewhere in the acreage and is a strong indicator of the presence of hydrocarbons.

The Company expects full analysis of the results of this survey to be completed towards the end of March 2014.

Local Gravity Magnetic and Geochemical survey results

Gravity Magnetic and Geochemical (soil gas) surveys were conducted local to the site of the Eblana #1 well with the aim of reducing uncertainty concerning the direction of `updip’ and to aid in mapping the basement topology. Although difficult soil conditions hampered the Geochemical study, the Company believes that data from both studies integrated with existing data, will be sufficient for further geological modelling to confirm the direction of `updip.’ Subject to confirmation, preliminary indications are that `updip’ is West-North-West from Eblana #1.

Gravity Magnetic:

The acquisition of 109 data stations of detailed gravity data along 3 E-W lines was carried out to test whether detailed gravity information can define the target geological features and to ascertain the best data acquisition parameters. The gravity data has been processed, and correlation with the existing seismic data together with 2.5D modelling is in progress. Initial
analysis of the newly acquired detailed surface gravity data indicates that an integrated interpretation will allow significant further development of the geological model of the target area.

Geochemical (soil gas):

Extremely harsh soil conditions hampered this study, as frozen ground and snow-cover precluded sampling the area to the recommended depths of 3+ feet for soil gas surveys. Consequently, after completing a single transect over the northern portion of the area the project was halted. Because of the difficulties in obtaining optimal samples, the results can only be used to infer the presence of hydrocarbons in the area, and conventional gas ratio assessments cannot be applied to definitively define the area’s hydrocarbon potential.

Light hydrocarbons were present in most samples (albeit in quantities only slightly above detection limits) but there was sufficient C5+ and C6+ along with methane and other lighter homologue to show that hydrocarbons are present in the area. The favourable readings appear to be near the central region north and slightly west of the current well. A repeat of the study is planned for the end of first quarter 2014 in the expectation of more favourable conditions.

Data Integration

The data collected in the surveys outlined above are now being integrated with all other data sets to allow for the planning of further wells and the submission of any additional regulatory applications that may be required.

2014 Programme

The purpose of the 2014 programme is to progress the project towards a commercial find in Hot Creek Valley, to move the asset further up the value chain to Proved Reserves, to further delineate the extent and size of the oil system and to estimate the resources potential of the full Hot Creek Valley acreage.

The Company intends to extend its exploration programme by drilling further wells and by carrying out 3D Seismic and Passive Seismic surveys of the full Hot Creek Valley acreage, subject to the necessary permissions. As indicated above, a repeat of the soil-gas survey in the area of Eblana #1 is also planned. The option of carrying out a Vertical Seismic Profile (VSP) survey from the Eblana #1 well may also be implemented, subject to the results of current modelling activities.

While the Company has $1m funds on hand, further funding will be required to fully implement this programme.

Field Development Plan

As part of the corporate programme, a considerable investment of time and effort has been expended by the team in developing a conceptual Field Development Plan for the Hot Creek Valley property. Such a plan is a prerequisite for finalising discussions with potential partners, and the Company is working closely with Forrest Garb & Associates to develop the best
possible plan with its associated costing[DEL:,:DEL] expertise and company infrastructure.


Neither this announcement nor the information contained herein constitutes an offer or solicitation by U.S. Oil and Gas plc for the purchase or sale of any securities nor does it constitute a solicitation to any person in anyjurisdiction where solicitation would be unlawful.

For further information contact:

Brian McDonnell, Chief Executive Officer +353 (0) 1 631 9022

Alexander David Securities Ltd – Corporate Finance Adviser
Fiona Kinghorn/David Scott +44 (0) 20 7448 9800

GXG Markets
Simon Kiero-Watson +44 (0) 20 7653 1935
[email protected]

Alex Benger +44 (0) 20 7653 1935
[email protected]

ADR Broker Desk, Deutsche Bank
United Kingdom
Simon Davies and Richard Willis
Tel: +44 (0) 20 7547-6500
Fax: +44 (0) 20 7547-9995
E-mail: [email protected]

Jay Berman
Tel: +1 212 250-9100
Fax: +1 732 544-6346
E-mail: [email protected]

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About U.S. Oil & Gas

U.S. Oil & Gas plc, (GXG London: USOP, OTC New York: USOPY), is an oil and gas exploration company with a strategy to identify and acquire oil and gas assets in the early phase of the upstream life-cycle and mature them. The Company’s
main asset is in Nye County, Nevada where it holds the entire share capital of US-based company Major Oil International LLC (“Major Oil”). Major Oil has acquired rights to exploration and development acreage in Hot Creek Valley, Nye County, adjacent to the oil and gas rich Railroad Valley area of Nevada, both of which are part of the Sevier Thrust of central Nevada and western Utah, USA.

U.S. Oil & Gas PLC.

For further information please refer to our website at: www.usoil.us