Intro: Silver Tusk Oil Co. / Webinar March 20th 2015 Shawn Bartholomae, Sr. Partner at Silver Tusk Oil Co.
NYMEX Natural Gas Price: $2.79
Crude Oil (WTI): $45.72
I will be addressing many of the questions that are frequently asked. I will be answering some questions that are asked during the Webinar. If by chance I have not answered a specific question, or you were not clear about a particular topic, please do not hesitate to call us after the Webinar to speak directly with myself or one our Silver Tusk representatives.
During this Webinar, I will be delivering information that is not easily conveyed on a website or an email so please remain on the webinar for the duration.
You will be particularly interested in hearing about the planned exit strategy for both the STLADP and the Trinidad!
K1: The STLADP K1’s have been mailed.
December Production Willard & Whelan only
Price $41 a barrel Checks Dated Jan 31st 2015
ACH Deposits on March 6th 2015 Partners’ Share: $45,000.
**The above revenue is two weeks late due to Tax season and preparation of 2014 K1’s
January Production Willard, Whelan & Perrard only
WTI Price $42 a barrel Checks Dated Feb. 28th 2015 ACH Deposits on March 17th 2015 8/8 Gross Production $193,050.
Partners’ Share is 64.75% of 8/8 Gross = $125,000.
Willard, Whelan, Perrard
M Sanders, JD Kilcrease & Kilcrease Bowles
WTI $45 a barrel / NYMEX $2.72 + $1.50 Bonus = $4.22 estimated
Checks Dated March 31st 2015 ACH Deposit on April 15th 2015 8/8 Gross Production = $434,741
Estimated Partners’ Share is 64.75% of 8/8 Gross = $281,495
Willard, Whelan, Perrard, M Sanders, JD Kilcrease & Kilcrease
WTI $48 a barrel / NYMEX $2.72 + $1.50 Bonus = $4.22 estimated
Checks Dated April 30th 2015 ACH Deposit on May 22nd 2015 8/8 Gross Production = $872,194
Projected Partners’ Share is 64.75% of 8/8 Gross = $564,746
Should increase over March production due to the Whelan #16 being on line expected choked down to a restricted rate of
STLADP Development Status
Well Status Willard #1:
Burleson Co. / June 2014
Brief Well History – Double Horizontal
Buda Cumulative Production Revenue:
$1,286,000. Partners Net Share
Chalk Cumulative Production Revenue: $286,350. / $57,270 average over 5 months Present Rate 823 BOPM
Potential after stimulation could significantly increase the
present rate / a stimulation procedure is on hold until WTI Crude climbs back over $75 a barrel / Anticipated 4th quarter 2015
Perrard #1: Burleson Co. / December 2014
Cumulative Production Revenue: December: $18,625. Frac Flow back January: $45,634. Frac Flow back February: $58,393. Frac Flow back March $54,900 Frac Flow back
$122,650. Partners Cumulative Net Share after Feb.
Present Rate 1,220 BOPM
Fracture Stimulation Status: Continuing to flow back Frac fluid with increased oil cut / presently at a 29% oil cut
It is our expectation to see the oil cut climb up to 60% by the time we recover all the frac fluid. Final expectations for this well are very positive.
The true production capabilities of this well is expected to be quite high but cannot be fully realized until all the frac fluid has been recovered.
** Let’s assume the following scenario regarding the Willard & Perrard.
Let’s say WTI Crude climbs back to $75 a barrel this fall. Then doubling the present production rates from these two wells, which by the way is ridiculously conservative, the combined revenue from these two wells would climb from where it is now $109,000 for January Production to over $360,000 a month 330% increase in Revenue just from these two wells.
Margie Sanders #1:
Navarro Co. / Placed on line
Present Rate 1.405 MMCFGPD – 131 BOPDE & 43 BCPD 174 BOPDE @ present rate and price!
10 day production in February
Or 1,748 BOE in 10 days.
JD Kilcrease #1:
Navarro Co. / Placed on line
Present Rate 1.401 MMCFGPD & 38 BCPD = 169 BOPDE 10 day production in February
Kilcrease Bowles #1: Navarro Co. / Placed on line
4/64” Choke with 340 PSI FTP 241 MCFGPD – 15 BCPD – 38 BOPDE
10 day production in February
P. Casavilla #1:
Henderson Co. / Placed on Line
H20 and future plans and hope
6 BOPD – 28 BOWPD Sold a load of Oil:
Jan - $7920
Feb - $8590
Estimated March - $8230
Swab Rates 3 BOPH
Expected Potential 70 BOPD
Expected Restricted Dailey Rate: 30 BOPD
Waiting on Oil Pipeline / Define pipeline circumstance
Oil Pipeline under wetlands 500’
STOC would try to negotiate a 10% CWI & 7.5% NRI from production in this lease to be earned by the STLADP.
Acreage is prime Buda Lime and Austin Chalk potential Potential to drill 3 horizontals in Buda or Chalk Potential for 1,000 BOPD production would be a practical expectation from this acreage
By the 4th quarter of this year we expect to have the acreage
By the 4th quarter of 2015 prices are expected to be back in the $75 per bbl. range.
At that price, combined with 1,000 BOPD output would generate the STLADP an Estimated Positive Cash Flow of $170K pr. mo.
Estimated 36 mo. @ $75 a barrel could yield a Cash out Value of $6MM
Additional Rodessa Acreage Owned by STLADP 1,000 prospective acres adjoining the M Sanders & Kilcrease
This acreage to be purchased and developed by the Trinidad Lake I Prospect Partnership
I will discuss how this prospect will benefit the STLADP Partners.
Overall expectations of the STLADP
$45MM was raised to drill 15 wells prior to utilizing revenue for remaining 10 wells to total 25 wells.
These additional 10 wells are to be drilled and completed with cash flow received by the original 15 wells and so on.
How fast will the remaining 10 wells be drilled? This variable is dependent on other factors such as: How strong the original 15 are producing?
The price of oil and gas at the time. The drilling cost at that time.
As each additional well is placed on line, the level of financial contribution it makes toward the development process.
As more wells are placed on line the process begins to speed up significantly.
Realistically 24 months to drill 25 wells overall
Where do we expect our partners to be financially after the STLADP has been fully developed?
This is a very difficult question to answer.
All of the rapidly changing elements that contribute to the end result make it near impossible to be accurate with an answer.
With that being said, there is a conservative approach
For an example:
Let’s assume WTI Crude doesn’t average over $75 a barrel and that NYMEX Natural Gas price don’t average over $3 per MCF over the next 24 months.
Let’s assume that the remaining wells drilled and placed on line are only average in production.
Let’s assume that only 85% of the remaining wells to be drilled are commercially productive.
And let’s incorporate sharp decline production curves to all the producers.
I could calculate an
This does not include any additional income that the STLADP would see from
An estimate from already known and planned
totaling $2.7MM per mo.
The STLADP is the type of development that is specifically designed for an Exit Strategy, to have many of the desirable attributes that interest most production buyers such as: Large blocks of acreage held by production with
proven reserves. Multiple Producing wells
Combination of Oil and Gas production Infield development potential Existing infrastructure
Geological Consistency Multiple completion potential per well
Trinidad Lake I Prospect Partnership The TLIPP is a
It creative structuring and design addresses several important issues at once.
Partnership Structuring – Such as a minimal 15% Carried Working Interest, which 10% is allocated to the STLADP
Trinidad is economically streamlined for the Investor Partners objectives such as
Actual cost development / Unburdened / Working Interest Partners have No reduction of ownership after payout.
Revenue is not being used to drill all the wells in the development.
Trinidad is designed to significantly boost the partners overall ROI in both the STLADP / Trinidad.
Trinidad financial impact on STLADP can be highly beneficial After full funding the Trinidad will return
STLADP earns 10% CWI 7.5% NRI in the TLIPP Estimated positive cash flow to be $45K pr. mo to STLADP
Trinidad – Planned to drill 5 wells originally.
AFE estimate was completed in December 2014 when drilling cost were much higher.
At present drilling cost we may expect to drill at least 8 wells overall without having to utilize any of the existing revenue.
Geological Characteristics in the Trinidad development are an extension of the
M Sanders & Kilcrease Wells
The data from the M Sanders and Kilcrease wells lend geological insight to the 1,000 acres that directly surround those wells. This acreage will be rapidly developed will by the Trinidad Prospect.
Natural gas is our primary objective; production should be 85% natural gas and 15% liquids such as oil or condensate.
Moreover the gas from some of our targeted formation within this region will likely yield a very high BTU rating just as it did in the nearby wells M Sanders & Kilcrease wells.
This brings a much higher price than NYMEX spot, like in the M Sanders & Kilcrease wells our contract from Enbridge is $1.5 above NYMEX Spot.
An example: If NYMEX Spot is at $3 per MCF then we would be receiving $4.50 per MCF.
TLIPP Development Timeline
Is going to be a very rapid development compared to the STLADP
Infrastructure already in place Geological Consistency
Vertical wells drill out in less than a month per well With drilling cost down and continuing to go down we could
easily drill 8 wells with the $11.75MM And
have them placed on line in as little as 9 Months!
Provided the Trinidad wells perform as good as the M Sander & Kilcrease Wells they could comfortably
Generate $1,330,000 8/8 Gross Production at today’s prices This is around $860,000 a month in net revenue to the Partners Net Share – Not bad for an $11,750,000 investment!
This is much more than I indicated in my recent email Titled
A True Silver Crossing
Strategically speaking an Investment in the Trinidad Prospect may yield significant returns and be highly beneficial for any partner that is already a participant in the STLADP, this may enhance their ROI potential overall!
Silver Tusk Website
Presently being modified for Investors to log in and track production history and payments along with future estimates extending 3 months.
Per Unit Calculations with an example of production figures
STLADP – M Sanders, JD Kilcrease & Kilcrease Bowles
Combined daily production from the above mentioned wells: 3,500 MCFPD X 30.5 Days X $4.22 = $450,485 8/8 Gross Production
118 BOPD X 30.5 Days X $45 = $161,955 8/8 Gross Production
Total 8/8 Gross Production = $612,440. From the above mentioned wells. To calculate your % share from 8/8 Gross production:
64.75% Net to the Partners Share / 3600 units = .017986% per Unit X 8 units =
.143888% (8 units share).
$612,440 X .143888% = $881.22 per month income to 8 units share from just these three wells over a 30.5 day period.
Or another way to look at it would be as followed:
To calculate your share of Partnership Distributions:
3600 units / 8 units = 450, 8 units share is 1/450th of Partner Distributions
$612,440 X 64.75% Total Partners Share = $396,554.90 / 450 = $881.23 8 units share per month
$612,440 X 64.75% Total Partners Share = $396,554.90 X .027777% per unit = $110.15 per month per unit X 8 units = $881.23 per month 8 units share
The sell value of $881.23 is as followed: $881.23 X 60 Months cash flow = $52,873.8 sell value your share from just the three wells only – This is from an 8 unit investment of $100,000.
Comparison in percentage ownership:
STLADP = .017986% per Unit of 8/8 Gross Production Before payout
STLADP = .0143888% per Unit of 8/8 Gross Production After payout
Trinidad = .066246% per Unit of 8/8 Gross Production Always.
I would ask that each of you respond after the webinar to at least let us know if the information you have received is understandable and helpful. Our Partners’ input is very important to us. We are open to any suggestions about how we could better improve our communication with you.
Shawn Bartholomae, firstname.lastname@example.org
The Accreditation Process may simplified.
All that is needed is a letter from one of the following, your CPA, Attorney, Banker, Investment Firm or Financial Advisor that simply states you are accredited as of this date. Or for that matter, Phoenix American may also complete the accreditation verification as long as you show proof of accreditation by supplying them with proof of funds in excess of $1MM.
To simplify your subscription process for the
Trinidad Lake I Prospect Partnership you may call us directly here at Silver Tusk Oil Co.
Additionally you may click on the following link
Trinidad Subscription Documents
To download and open the Subscription Documents. All the Best,
Silver Tusk Oil Co.