HMGP Hemi Energy Group Inc (GM)

Hemi Energy Group, Inc. (Pink Sheets: HMGP) January oil production ramped up to 669 bbls from the December production of 461 bbls. We sold 395 bbls in January and are cash flow positive as we were in December. Even though we are in the dead of winter in Kansas, which required us to periodically shut down some wells on leases for maintenance caused by winter weather, we have still been able to increase production to this level. Not reflected in these numbers is the Bennett lease which is still off line for additional development and service work. The de-watering process is working well as the ratio of oil to water is continuing to improve which demonstrates the oil migration continues to respond positively to our enhanced oil recovery EOR programs. We will see continuing increased production near term and throughout the coming year as the EOR programs expand across the 1800 acres of leases in Woodson County, Kansas that we are re-developing. Hemi increased its checkerboarding of leases in Fort Worth that are intermingled with the Barnett shale leases of two large oil companies, listed on the NY stock exchange, that have major urban drilling programs. We have acquired additional leases that will absolutely be required legally by these two giants for several of their drill locations before drilling can begin. Management's opinion, based on due diligence and experience, is that some of our FW leases will become pooled as part of these large oil companies' drilling operations in 2008. Hemi believes these FW leases and proving up of Kansas and Texas reserves will gain recognition from larger oil companies and further our stated goals. Hemi has the funds to start new well drilling in Kansas as soon as the weather allows and the logistics are completed. In early spring Hemi also plans to drill new wells to replace the less efficient or mechanically inoperable mature wells on some of these 5 leases that comprise the 1800 acres in Woodson County, Kansas. We are exploring several options available for development of Texas leases. Funds will also be available for drilling a proven oil producing lease in Texas. Hemi Energy Group is an independent crude oil and natural gas producer employing a unique business model capitalizing on technological advances to exploit mature fields with millions of barrels of proven oil remaining in the ground. Using attractive lease/royalty packages Hemi has secured in its history tens of thousands of acres of productive domestic projects. The company's forward-thinking strategy has placed it in an enviable position at a time when prices and global demand for oil continue to rise. Building on decades of experience in enhanced oil recovery Hemi has successfully amassed a substantial and attractive portfolio of these high quality domestic properties. By streamlining operations through cutting-edge technologies, Hemi has the ability to operate more effectively and efficiently than larger oil companies. "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995 Statements in this press release relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, risk factors inherent in doing business. Forward-looking statements may be identified by terms such as "may," "will," "should," "could," "expects," "plans," "intends," "anticipates," "believes," "estimates," "predicts," "forecasts," "potential," or "continue," or similar terms or the negative of these terms. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. The Company has no obligation to update these forward-looking statements. For additional information please go to http://hemienergy.com.