NE OK Oil/Gas Production w/Oilfield Service Co

We own and operate a 55-well package situated on 2,880 acres in prolific NE Oklahoma. The wells are all shallow vertical wells from 1,700’ deep to 2,500’ deep. Our pre-purchase research indicated that the leases had tremendous potential and simply needed a knowledgeable operator with enough capital to turn on the wells and maximize the production.

Part of the leasehold contains the largest Arbuckle high in the area, and there are five Arbuckle wells already drilled (1960’s vintage) that came in at 200 to 500 BOPD. We have re-activated one of the wells so far and it produces about 20 BOPD after upsizing the pumping equipment twice to pump down the fluid level for maximum production. Based on the historical production, we believe that the remaining four drilled Arbuckle wells can be reworked and equipped with PC pumps which will move fluid efficiently, bringing those wells back to at least 10-20 BOPD each.

There is room to drill several new Arbuckle wells on the high. We can drill and complete a new 2,500’ deep Arbuckle well for $277,000 (worst case) that should produce at least 25 BOPD and could come in between 200 and 500 BOPD. This Arbuckle high is well known among the local authorities, and we have strong confidence and evidence that it contains enormous potential.

We have good Arbuckle disposal wells on the leases, and the wells are generally on a strong vacuum, so we do not haul any water and only pump into one of several wells with a ten HP motor.

We currently have 12 wells back online and the production is about 35 BOPD and 50 MCFD gas. Due to low crude prices and increased costs of operation due to inflation and tariffs, we simply do not have the capital to finish the development of these valuable leases and are seeking a capital partner to bring the necessary funds to finish the work in exchange for a 70% stake in the operation. Alternatively, we would consider selling the leases 100% but only to an operator qualified to take advantage of the potential.

OILFIELD SERVICES
We purchased one rig with the purchase of the wells to perform our own well repairs and workovers in-house to save capital. We have since purchased two more rigs and have developed a very active and growing business servicing customer wells as well as taking care of our own wells at minimum cost. We have $350,000 worth of rigs, crew trucks, winch truck, and other equipment currently. We could justify the purchase of two additional rigs to accommodate a few large customers and to accept a large plugging contract (100 wells in first tranche) the local authorities have offered us.

We feel strongly that the two businesses are intrinsically linked and need to remain under the same ownership and management. The company wells need access to very affordable rig work, and we have a large and growing customer list for retail rig work. We have three excellent rig operators with crews and can hire more. We can easily add additional services, including winch truck work, roustabout work, tank truck work, road work, and mulching/brush hog work as the business continues to grow.

SUMMARY
We are seeking a capital partner to fund the well development and drilling on the leases, and fund the growth of oilfield services. The capital partner will need to deploy up to $2 Million, and we expect 100-125 BOPD, 200 MCFD gas, and at least $600k revenue from oilfield services. We estimate that the combined operation will be worth $5 million+.