Facts on Mineral Right's Business. B-G PARTNERS, LLC. Started in 1983, Has three managing members of the General Partner and over one hundred and fifty Limited Partners,
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Started in 1983,
Has three managing members of the General Partner and over one hundred and fifty Limited Partners,
For fifteen years, Partners continued to purchase “Class A” locations as delineated by the Majors working in the Michigan Basin.
These partnerships were all “rolled up” into two Master Limited Partnerships in 2003 and 2004.
Consists of mineral rights to reduce personal liability for partners.
Partners receive their share of revenues as income from producing wells.
In partnership with a Michigan LLC, it has 594 sites that represent about 8,000 net acres.
Each site may elect to participate (at cost) in the drilling/completion expenses and receive a pro-rata share of net revenue from a successful well rather than a royalty participation.
Map of Michigan geological location (Exhibit 1),
Formations are U shaped that is similar to the Permian Basin (Exhibit 2),
Antrim is 200’ at the edge and 2,000’+ in center of State (Exhibit 3),
Dundee is in 3,000’-5,000’ range,
Utica-Collingwood shale depth ranges 7,200’ to 9,700’.
PDC is at the center and 9,000’-12,000’ deep.
Antrim, Dundee, Utica-Collingwood, St. Peter Sandstone/Trenton and Prairie du Chien,
Prospects drilled and abandoned by major oil companies,
Several up-hole targets identified for redrilling in abandoned PDC wells using new technology.
Formation diagram (Exhibit 5A),
Comparison with Barnett Shale:
i) Antrim Shale covers a larger area than Barnett Shale in
ii) A bullet point list of the Antrim compared to the Barnett Shale that is supported by government documentation (Exhibit 5B+C).
iii) It underlies all of the lower peninsula of Michigan and has as much
potential as the Barnett,
iv) Requires a good fracture system.
v) Antrim Shale, as a gas play, at depths of 500’-2,000’, and 2,500’+ for
USGS estimates success rate for finding new Antrim is at 80%… Bradford-Gordon mineral right’s sites
Opportunities in Osceola County
i) Seventeen identified properties should have an excellent
potential for success in the Antrim.
ii) Evidence of enhanced fracture content within the Antrim
locations because of geological structure associated with
currently producing fields.
Primarily located in Central Basin where drilling costs are low.
Various wells at Fork Field (Mecosta Co.) offer a unique chance to find additional oil at low risk; the location of the oil is known and has a significant percentage of unrecovered hydrocarbons.
In the field, a horizontal well can have 4-10 times the productivity of a vertical well. (Exhibit 8).
Drilling mud logs and structure maps are shown for McCasey 1-7, Noreen 1-18, and St. Burdell 1-5 sites. (Exhibits 9-12A+B).
The fourth site, Zinger 1-1, has several additional oil/gas reserves in formations located in “deeper productive horizons.” (Exhibits 13A+B)
Note: B-G has mineral rights in two other wells near the site.
As it has a large minority of mineral properties in the county, further evaluation should be on an area wide basis instead of individually (Exhibit 14, on the next page).
Most of the top selected abandoned PDC wells for the Utica-Collingwood shale is located in that County. (Exhibit 15, on page 34)
The conversion of “6 to 1” from the gas equivalent to the oil are as follows:
Dundee 20 Bcfe 3.3 MMBOE
Antrim 695 Bcfe 115.8 MMBOE
Upper PDC 816 Bcfe 136.0 MMBOE
Twenty of the abandoned PDC well sites were identified for re-drilling and offsets in potential reserves, which are located primarily in Osceola and Mecosta Counties.
Comments on these sites are available on request; all have top ratings by a noted petroleum geologist.
Seismic surveys will be required but, over the ten year period, the total revenues from the Selected Six Sites is projected after drilling cost at $88.5 million, or at present value (PV) valuation of $25.6 million assuming oil at $45 per barrel and gas at $4.25 per Mcf.
The PV Valuation, on the next page, should increase in value once research on Utica-Collingwood takes place.
With PV at $3.034 billion and a 4% participation, the value amounts to $121.3 million - based on $80 per barrel.
In another perspective on Bradford Gordon valuation, research on the holdings on the leases was recently valued at $440 billion, with development/ production costs estimated at $12 billion for a $428 billion profit.
Spreadsheet has interesting Purchase Narratives on each site.
February 19, 2012