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KFG Resources Ltd., through its 100% owned U.S. operations subsidiary "KFG Petroleum Corporation" owns production and holds exploration and development interests in Louisiana and Mississippi. Daily average production for the quarter ended July 31, 2014 was 75 BOPD. Average oil price received was $102 per barrel. Oil sales for the quarter ended July 31, 2014 were $788,143 and management fee income was $116,266 totaling $904,409 as compared to $582,176 in the fiscal first quarter of 2013. Wilcox Oil Play KFG focuses on the Wilcox formation which is a water-drive reservoir of Eocene Age prevalent in East-Central Louisiana and Southwest Mississippi. The Wilcox is a relatively shallow horizon varying between 3500 and 9200 feet in depth. There is also the deeper Tuscaloosa formation in many areas where KFG operates and when found is known to be a prolific production horizon. KFG's projects are described below. Mississippi Fayette Field, Jefferson County, Mississippi The Fayette field is located 21 miles northeast of the city of Natchez. KFG has a 74.9% working interest (59.4% net) in the field. Fayette is a salt feature covering approximately 3800 acres. Past production was from the Wilcox and the Lower Tuscaloosa formations. KFG did a 3D seismic survey in 2008 and the results led to the discovery of the Spring Hill feature in June 2009. Spring Hill is fully developed with 6 producing wells. KFG has 2 other wells at Fayette including 1 small gas well. The reprocessed 3D seismic survey reveals both shallow and a deep target which KFG intends to test in the future. The Spring Hill is past the flush part of production and is in a long slow decline. Carthage Point Field, Adam's County Mississippi KFG drilled the MacNeil #2 well in March 2013 and a successful offset, the MacNeil #3 in October 2013. In August 2014 payout of the project was achieved and KFG's working interest increased to 20.5% from 8%. Daily production is 50 BOPD. LaGrange Field, Adam's County Mississippi KFG has a 10% working interest in the Parker Lease with no reversion. Four wells have been drilled - three producers and one dry hole. Combined production on the lease is 90 BOPD and it is fully developed. Also at LaGrange but in a different part of the field, KFG drilled its Craig #1 well in November 2013 followed by its Craig #2 in January 2014. Production from both wells is about 115 BOPD. A third well, the Craig #3, was put on production in July 2014 and it is currently producing 50 BOPD. The Craig #4 well has been staked and will be drilled in December 2014. The Craig #1 and #2 wells have paid out and KFG's interest jumped from 10% to 21.5% in those wells. KFG's working interest in the Craig #3 well is currently10% Mantua Field, Adams County, Mississippi In September 2014 the Company completed its Barnum #2 well at 6398 feet in the Parker Sand of the Wilcox. The well is currently producing 140 BOPD and will be offset in the first quarter of 2015. KFG has a 9% working interest in that well, jumping to 20.5%at payout. At this writing there appears to be three potential offsets. Franklin County, Mississippi There are several areas in Franklin County being leased by the Company which KFG intends to drill in the first Quarter 2015. Depths range from 4400 feet to 6800 feet. In each instance KFG has mitigated its risk by only keeping a 10% working interest and, if successful, backing in for up to an additional 16.25%. At present three of these projects are drill ready. Louisiana Concordia Parish, Louisiana KFG has three leases in Concordia Parish. The Dale lease went off production in April 2013 and was returned to production in May 2014.after being shutin for a year waiting on saltwater disposal well approval. The lease is currently producing 25 BOPD from two well with an average working interest of 17%. The Roundtree lease is currently shutin, awaiting a cement squeeze to shut off a channel in the cement and the Clayton Lease, (#1 Miller) continues to produce about 12 BOPD, KFG has a 4% working interest at Clayton increasing to 18% at payout. . |
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WOODVILLE RD., SUITE 2, NATCHEZ, MISSISSIPPI This Company Listed On TSX Venture Exchange TSX KFG |
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This website has forward-looking statements which involve risks, uncertainties and other factors which may cause actual results to be materially different from those expressed or implied by such forward-looking statements. Although management believes that the expectations reflected in such forward-looking statements are reasonable, it cannot and does not guarantee future results nor does it undertake any obligation to publicly release any revisions to the forward-looking statements to reflect events or circumstances after the date hereof of to reflect the occurrence of unanticipated events. Shareholders and prospective investors are accordingly cautioned not to place undue reliance upon the forward-looking statements. |