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Black Dragon Resources Companies, Inc. (BDGR)
Black Dragon Resource Companies, Inc. is an independent domestic oil and natural gas producer. The company’s strategy is to generate stable cash flow and production by acquiring mature oil and gas well fields.
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| Recent Price |
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| Market Capitalization |
3.4M +/- |
| Est Float |
36 M +/- |
| Outstanding Shares |
69 M |
| Quotation |
OTC.PK |
1714 Forkview Road
Austin, TX 78704
Phone: 512-442-4151
Fax:
http://www.black-dragonoil.com
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| Similar Companies in Sector |
- Black Dragon
's focus on mature, domestic oil fields eliminates exploration risk, reducing costs, and provides immediate generation of income in a niche market where larger independent and major oil companies are not positioned to compete.
- The company is noted for its domestic oil and gas assets located in the Caddo Pine Island region of Louisiana.
- According to a March 2005 Department of Energy report of the major oil fields in Louisiana, Caddo Pine Island contains 2.06 billion barrels of Remaining Oil In-Place (ROIP), the richest field in the Onshore Gulf Coast basin.
- The company has no exploration risk. Black Dragon's portfolio contains an ever-increasing number of producing wells.
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Favorable governmental issues exist to increase domestic production.
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Black Dragon Resources Continues Its Property Acquisition Program
BDGR recently announced that it has acquired 65 percent of the working interest in four oil and gas leases in the Caddo Pine Island Field. The leases add 240 additional mineral acres, and 33 existing oil and gas wells. Two of the wells are in the Glen Rose Formation (3500-4500 feet deep), 20 are in the Annona Chalk (1500 Feet) and 11 are in the Nacotosh Sands (800-900 feet). The Company's field administrator, Ronnie Allen, has informed Black Dragon that he anticipates that the existing wells when placed into service should produce at least 600 barrels of oil a month, applying existing data.
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BDGR Announces Profitable Sale of Caddo Lake Property
The company has completed an agreement for the sale of the Caddo Lake shallow rights. This sale as it has improved the Company's economic position, realizing $1.1 million in cash and elimination of a $2.4 million liability. Analysis of the higher costs and operating complexities associated with drilling and maintaining the lake properties indicated that
the Company is better served by focusing on the land based operations.
The Company showed a net gain on the sale of approximately $640K. The company is now proceeding with an aggressive drilling program in Hosston and Pine Island
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Black Dragon Resource, Inc.
(OTC.PK:BDGR)
Black Dragon Resource Companies, Inc. (BDGR), is focused on the acquisition and production of: (1) abandoned or marginal oil and gas stripper wells, and (2) the development of new production in mature, shallow, proven oil, and gas fields. By bringing properties online in today’s energy environment, BDGR is capturing economics that were not achievable a few years ago when many stripper well operators shut down production. By acquiring properties in areas with proven reserves, BDGR is sticking to a core operating principle in which BDGR accepts execution and energy price risk but incurs minimal exploration risk. BDGR’s properties are located around Oil City in Caddo Parish in northwestern Louisiana near the Texas border. To maximize operational and management efficiencies, BDGR plans to remain focused on production within the general Caddo Parish region. If energy prices remain relatively stable, allowing the company to continue installing wells out of free cash flow, BDGR’s growth potential for 2007 and beyond is tremendous.
Like any oil and gas producer, BDGR’s cash flow and growth opportunities are amplified or muted by
energy prices. However, BDGR has positioned itself well operationally and financially with significant
growth opportunities under the right market conditions but relatively low overhead. The Company’s
strategy of financing via working interest vs. debt, allows management to apply the brakes should oil
and gas prices fall. BDGR has assembled a strong management team and working group with extensive
experience in the Caddo Parish region. By concentrating in a small geographic area, BDGR will enjoy
operational and management efficiencies and should have ongoing opportunities to acquire additional
wells.
Caddo Pine Island
Black Dragon has acquired 915 wells in the Pine Island area of Caddo Parish, Louisiana, and
nearby fields in
Haynesville
,
Louisiana
;
Corsicana
,
Texas
;
Palestine
,
Texas
and
Harrison
County,
Texas
. The vast majority of these wells are drilled into the Anocha Chalk formation.
350 of these wells are currently equipped and producing oil. Approximately 550 wells need
additional equipment to be productive. The Company has three rigs dedicated to this task and
Management believe that its crews can place 50 wells into production each month at a cost of
$3,000 per well. In addition, there are approximately 100 wells that require more extensive work
to be returned to production. The Company has one rig dedicated to these wells that can add one
well per week to production at a cost of $10,000 per well. Upon completion of the 550 wells,
these rigs will be assigned to the last 100 wells until all are in production.
The Company’s 14 wells in Haynesville and the wells in Texas will be put into production
during the first 3 months, post-financing. Conservative projections of 3/5 barrels per day per well are anticipated, translating into 550 barrels of oil per day, or 15,000 barrels per month. The Company holds all of the working interest equal to 70% of 8/8 of production. Operating expenses are budgeted at $130 per well per month. At full production, these properties are projected to yield $5.5 million in annual net income, before taxes and depreciation.
Engineering reports substantiate these projections and show proven reserves in place of:
Pine Island Wooldridge Properties 5,500,000 barrels
Petrol Properties 6,750,000 barrels
Haynesville Properties 5,500,000 barrels
Arkana Properties: Currently working on 30 mcf and 3 Million Barrels of Oil: 25 to 500 Barrels a day
Black Dragon’s wells are located in one of the most prolific petroleum basins in the U.S., with
over 2 billion barrels of remaining oil-in-place, more than 3 times larger than the next largest
field in the State of Louisiana
.
Leadership
Richard Michael
,
President
Ronnie Allen
,
Vice President, Director
Thomas V. Neely, Corporate Secretary, Director
Monte Anderson, Chairman, Director
Barry McFarland, Chief Financial Officer
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