Mon, 15 Dec 2008|
Automatically Generated Transcript (may not be 100% accurate)
Thank you. And there we appreciate. Have in the form appreciated by taking the time out to become listens -- late on Thursday afternoon. No market for inching right now we banker -- not name. Had lunch with the 11100 dollar -- if you have moments of my anymore. He's with his if you had when I take it private and bring back change so that's kind of the world we're in right now it's almost. The situation to where this challenge not only for the for -- shareholders but from management. And it does come here I think -- the time to increase value I think there's it's. Never things are tough is this when he -- make make a lot of value of the company and I think Connell was well positioned with some things we have done. Over the last three or four months. To be able to survive and possibly it would -- roast tonight for our shareholders. We're gonna have forward looking statements. And so what you wanna look at -- well we're 200 million barrels resource company. And what's interesting about a company where strictly water would primarily war -- enhanced oil recovery. And as we sit here today. We never go -- the presentation keep in mind we've spent about a hundred million dollars capital. In these fields over the last year to eighteen months we're just starting to see the results -- as we go forward into 2009. Who were positioned pretty well. Be able to manage within our cash flow. Starting in January. And and still be able to see some reasonable production lift from the -- pleasant in this instrument four. Sort of the 250 all right of the 200 million barrels we have about fifty million barrels that are that are approved. If we were able to get the total 200 -- -- resource in this you won't -- -- MB three. We're gonna only have taken out about 20% of the original place. And if you add into that what's been taken after primary. Then you're still gonna have 50% of the rule one program that's exciting. As prizes can stay or go back up the technologies can continue to get better and better and we control it resource. No expiration risk would you have significant liquidity right now. We announced this morning we discover new credit facility in place. Redeeming California. -- 120 million dollar facility with a sixty million dollar borrowing base -- -- to. -- slide to 75 top and and when we're gonna set when behind as well with a point five penal facility. Fifteen million available immediately Maceda Libor plus six. Low risk again we're trading -- a very steep discount for years. We -- on the American Stock Exchange. We just celebrated our fourth year anniversary -- fiscal year end is June 30. The senior debt as a -- six -- so we've gone down about. Seven million dollars of that. We have about 46 -- shares outstanding with a market cap of point eight I think is closer going today didn't want -- look at it and fifty million barrels of proved reserves as I mentioned. Total acreage position we're in good shape we operate and Kansas -- excuse me Texas Oklahoma New Mexico. So if he is taking the federal liquidity going forward and 2009. We feel like -- we've reduced our capital budget from about 96 million and about 35 million dollars. The majority of that is gonna have been spent in the first six months through December. We'll talk a little bit about that and we'll get fields and then. Once we get in the January will be -- -- cash focused on maintenance capital well -- no responses. Again I told you about our facility that would just with would you like California. And we're gonna implement approximately three million dollars that that begins immediately that we have will be able -- DNA. And operational expenses. Again if you take a look at -- valuation. On approve girl. -- she and take a look at us on what we're being traded at -- flowing barrel or cash flow basis. For preaching. To a strategy historically when we first started this it was about a five year plan was in the first two to three years acquiring assets the idea was. You know that that were making at the time was -- ago prices you know can we get there's this thing and if we can and we're gonna do that and let's not -- a lot respond reserves. So the focus was domestic onshore. Go find some legacy assets. By product this is every asset primarily to -- assets we don't but that the other ones well. -- -- -- -- -- So -- got a lot of day a lot of information lot of infrastructure. You know how much have been taken out you know how much is left wrist as its capital just execution. So at this point in time we're in the execution -- -- started that about a year ago. And that again as we go forward -- 09 I think we're gonna realize a lot of the benefits. From the capital. That we have invested over the -- -- eighteen months. These -- our assets. And primary. Panel in Qaeda. Those are two tremendous fields potato fields and Andrus to our knowledge it's one of the if nothing partisan -- -- -- Permian Basin and it's never been more floated. We we have that going now the end of December we will never for fall's election -- injection. The panhandle -- attempt large school -- the United States. We sort of thing capital that about eighteen months don't mean war injection since February of this year. And it sort of sea lift of actually convert some war would reserves to PDT. And believe will be converting quite -- bit more this year as we continues to -- lift. We also. Go back the real quick up in the top right. Hand corner of Oklahoma was on a lot of field and we also been working on a history and the like tertiary as a way to go in important don't have -- to. That you can take your soaps and -- polymers to the field. And -- beautiful injecting injection there since last December. So almost a year -- anticipating. Started to see some results of that field as well here over the next 36 today it's pretty close. This gives a good visual. Or resource -- looks like about eleven -- I mean girls of PDP. About forty the UDs in another 150. Understand. Is what distinguishes a little bit from -- appears of -- 150. -- -- Fifty of that that there will be little if any more capital expanded its -- for the -- flood. Fields and it's going to be rate of recovery. So 7% -- recovery we're in Europe we can take that to nineteen and -- 14%. You're gonna pick up here that could mean from the main recovery. -- both of these bills around 12%. And for but programs and -- Last four quarters of production. With our business model little flat last quarter -- we didn't -- hundred -- underground. Very little fourth quarter last fiscal year. We picked it up this quarter and I believe would just release it this week and we -- finish growing up the -- -- Hamels -- And will be an injection the full injection by the end of this calendar here. So if you take a look at the panhandle are proper range unit draft 15100 acres. We started we drove about seven wells we're gonna have said we have seven injection wells -- producing well we're we're. Injecting about 50000 girls they wore. On we started it was about ten -- fifteen girls that they were -- -- they -- so now have been there for couple three months. -- the maintenance program some of the war was going it is not the best part rock. So we -- sixteen wells over the last couple months and -- -- -- right place. And feel like we're probably sometime -- 09 -- it PowerPoint now on. The -- -- we should start to -- more significantly -- response -- about twenty point 5% for calling feel a need to get about we have 50%. And -- continues in response. At the Cato field. This is interest in this may have -- one of their acquisitions that we've made. Right now million dollars -- seven cash -- We've drilled. A number of infill wells -- to finish up worthless pattern it was a pilot -- I -- -- necessary. In the eighties it was successful. Prices went down they exited so when there's this area where we're injecting right now -- has five mean Earl Warren ground. We're currently inject him about seven well we'll have the other seven objective going. Next month. And anticipates in response little quicker -- what you normally would. But I would expect anything public secondhand. Is -- your -- We took over this bill was about forty feet girls they were about 300 barrels -- -- now. See you see the drop in production. Or or border which in June. Was not an -- that -- back -- the program. And actually picked up some primary production. In some of the zones were not just -- weren't you live. The primary production over 300 girls today but -- mind would release the -- So it Kato's going to be the challenge to keep that there till we start to see some more -- response. We in July. Going forward then we're on we can maintain flat and maintenance capital and our cash flow. And at -- once we start -- -- the response collection. And we can continue to see -- production growth. Was minimal capital. Until tore the markers to position where -- -- -- sportsman. There's been wanna feel that talks about -- glorious. This. -- Is only produced about 13 of 1% wells and 75000. Barrels day. July 11250 girls -- for. So the idea of the time -- -- -- and some polymers. Soaps. Now valued at prime Andy Cooper bacon and every sport and get an -- and on dishwashing -- in their separated and same thing with the war -- just introduced this into the water flood and it will take -- -- more well rock. And our hope is is taken in the pilot from -- point 3% cut to two to 3% which is make the -- increase. -- -- -- -- -- -- Probable and have been part of move over and it PDP the -- would. Whether or not we'll go full scale and -- we'll see we've been successful more when the University of Texas now -- -- -- -- -- -- And steady and -- -- -- trying to get right when this looks like we may have some of the panhandle field and some other groups as well so we've proven. We'll have to make that decision that kind the total resource potential no one is about five million barrels and resource potential -- panhandle through -- this substantial. It's it's it's probably as much -- have looked at which thirty million barrels right now for war. So. You know right now I guess why you wanna buy Condo and and I know everybody stock is depressed right now. I guess -- now Jack and uses. Little over thirty days ago we sold off. 20% of our production non -- Represent less -- 10% of our reserves. Of 43 million dollars. A market cap today is -- about twenty me. So. -- where healthy and we've ever been our production from the -- would have is this is our evidence then. And -- month goes by where a lot closer for the -- you know to. Be a substantial part. Of our production and continue to get lift. We can do so without spending much camp which for some pretty unique position over the next twelve point four months. And -- -- to come to break out they have to answer any any questions there appreciate your time today.