Osage County, OK
Large Scale Oil & Gas
Development Opportunity
NYSE: HK
The price of oil is subject to change. We may also make material acquisitions or divestitures or enter into
financing transactions. None of these events can be predicted with certainty and are not taken into
consideration in the forward-looking statements. Actual results may vary materially from the forward-looking
statements, and we cannot assure you that the assumptions used are necessarily the most likely. We will not
update any forward-looking statements to reflect events or circumstances occurring after the date the
statement is made except as may be required by applicable securities laws.
Please note that this webinar/PowerPoint is an interest seeking presentation only. The investments and
strategies mentioned in the presentation may not be appropriate for everyone; other options not mentioned
may be more suitable for your specific circumstances. Past performance is no guarantee of future results.
Projected or discussed rates of return (ROI) on an investment discussed herein is not a guarantee that this rate
of return will be achieved. While every effort is made to maintain accurate, current information, the possibility
of errors and/or updates always exists. No guarantee is made that all information is current and accurate.
Investor agrees to perform their own due diligence and take full responsibility in satisfying themselves as to
the accuracy. Any projections, opinions, assumptions, or estimates used are for example only and may not
represent the current or future performance of the project.
Rick Coody
President
Ron Clark
Vice President
Marketing Communications
Business Strategy
Investor Relations
IT
Internet
Website Design
Computer Technology
Wanda Sanders
CFO
Handles the Financial and Administrative Side of the Business
Ron Herzfeld
Vice President
Geologist
Drilling Strategy
Business Strategy
Process +
Product
= Success
Rick Coody
"Field General" in charge of Oil Field Operations.
Handles drilling new wells, reworking old ones, and oil & gas lease acquisitions.
Has lived and worked in the OK/KS area his entire life.
25+ years oil & gas industry experience (14 years at Schlumberger).
Much of his career in the oil & gas industry has been in Management in the
Well Service area or as an Owner of Technology Companies.
Hired as a consultant by oil & gas companies in OK and KS to direct and manage
new well drilling and field development programs.
Manages and works closely with geologists and drilling contractors,
as well as with cementing and frac companies.
Responsible for executing each step of the drilling program through
completion and putting the wells into production.
Involved as a consultant in over 200 oil & gas wells from 2008 to 2013.
Oil production ranged from 3 to 20 barrels of oil per day.
New wells and reworked older wells.
President
Ron Herzfeld
Supports "Field General with Geology, Business Strategy, and Business Development.
Studies and analyzes oil & gas formations and then develops a drilling strategy.
B.A. degree from University of Texas / Captain in United States Marine Corps.
30+ years oil & gas industry experience.
Expertise and experience:
Oil field exploration and drilling oil & gas wells at depths from 500 to 18,000 feet.
Geologist
Waterflood, gas gathering, pipeline operations, gas compression and refining operations.
Active member of the Society of Petroleum Engineers (SPE); American Association of Petroleum
Geologists (AAPG); Geological Society of America (GSA); and New York Academy of Sciences (NYAS).
His work with magnetic geophysical exploration has led to the discovery of
major hydrocarbon reserves in the U.S., Canada, and Australia.
He has been widely published in the oil & gas industry . . . in publications such as
the Oil and Gas Journal and World Oil.
The production from oil & gas wells Mr. Herzfeld drilled, reworked, and
operated over the past 17 years is 648,281 Barrels of Oil* and 4,072,174,000
Cubic Feet of Gas*. Thats around $50,000,000 at today's prices.
He has also made 10 new oil & gas field discoveries.
*Numbers based on Railroad Commission of Texas Records RRC ID #681459
Well
Lawson West #1
Burkhart Lease (4 wells)
Brown #1
Hitzfelder #5
Hitzfelder #3 & #8
Hitzfelder A
Salazar Unit #1
Stowe #1
Stowe #2
Stowe #3
Shanafelt #1A
Jennings #1
Jennings #2
Field
Lawson West (Reef)
Kurten (Buda)
Big Foot, N. (Olmos)
Pure Ranch (Serpentine)
Pure Ranch (Anacacho)
Pure Ranch (A Sand)
Heep (Baffin)
Brookshire Dome
Brookshire Dome
Brookshire Dome
Shanafelt (Miss)
Jennings 300 (Anacacho)
Jennings 300 (Anacacho)
First
Production
Last
Production
Oil
(Barrels)
Gas
(MCF)
Nov 2006
Jan 1987
Feb 1999
Mar 1998
Aug 1997
Aug 1998
Jun 2000
Oct 2001
Jan 2002
Nov 2001
Mar 1976
Nov 2009
Mar 2012
Current
Feb 2000
Jan 2002
Current
Current
Current
Aug 2003
Nov 2002
May 2002
Dec 2014
Current
Jan 2013
Current
8,845
254,517
124,449
247,408
6,297
41,362
64,822
64,917
-
156,038
91,285
511,248
111,435
31,872
2,328,948
314,734
27,837
268
79,647
108,763
52,160
812,617
3,814,235
Depth
(Feet)
3,921
8,220
3,346
3,000
3,000
2,550
9,618
1,180
980
2,700
4,979
1,746
1,800
Ron Clark
Supports "Field General" with Business Strategy and Business Development.
Handles Marketing Communications, Investor Relations,
and IT/Internet/Website/Computer Technology.
B.S. degree in Aerospace Engineering from Penn State University.
Worked in Aerospace industry for six years at NASA and McDonnell Douglas.
Vice President
Transitioned from engineering to sales and marketing when joining Hewlett Packard (HP)
working for four years with business and engineering computer systems as a
systems analyst, an instructor, and in sales/marketing.
Worked in a sales/marketing capacity with Computervision for eight years and was a key
contributor in pioneering and defining the CAD/CAM marketplace. Wrote the first CAD/CAM
paper that defined the central database concept that would eventually automate the design,
engineering and manufacturing side of companies similar to what IBM had done to automate
the business side of companies. Responsible for millions of dollars in sales of CAD/CAM
systems to Fortune 500 companies, such as General Dynamics, Martin Marietta, Hughes,
Rockwell International, Beckman Instruments, Solar Industries, Rohr Industries, Garett Air
Research, and Bertea.
Became an entrepreneur working with start-up companies in various capacities from V.P. of
Sales & Marketing to President and CEO . Wrote business plans for them, "packaged
them", helped them raise venture capital, developed their marketing materials,
applied for patents, developed international markets/business, and much more.
Wanda Sanders
Handles the Financial and Administrative side of the business.
M.B.A. from Golden Gate University in San Francisco, CA.
Bachelor of Science in Business Administration in Finance.
Held executive-level positions at Hewlett Packard,
Verizon Communications and Alere.
Senior-level business leader with a successful track record producing
tangible results in three diverse industries: high tech, telecommunications
and medical devices/biotech.
In her spare time she has served as a member of several Philanthropy Boards
administering an annual budget of $66M designing and implementing Scholar
Programs for students throughout the USA. Recently, she was nominated and
featured in the annual issue of the Minority MBA magazine listing her as one
of the Next Generation of Business Leaders to watch based on her proven,
outstanding Leadership Qualities in her field. She has excellent administrative,
financial, project management, leadership and communication skills.
CFO
Pumping Equipment
Submersible Pump
Pump Jack
Extracts fluids (oil, gas, and salt
water) from an underground
formation reservoir. Fluids then
go into a separator.
Tank Batteries
Horizontal Separators
Lets look at
Oil & gas Production
from Existing Wells
Gross Gas
MMBTU
Gas WI Net
Revenue
Gross Oil
Barrels
Oil WI Net
Revenue
Monthly
Total
6,144
$14,956
341
$27,882
$42,838
Surber 1-26
20,211
62,635
209
15,688
$78,323
Surber 2T
5,390
16,706
70
5,229
$21,935
Ricketts 2-35
3,594
11,136
105
7,966
$19,102
Ricketts 3-26
14,721
48,720
70
5,229
$53,949
Ricketts 4-35H
8,646
26,467
70
5,653
$32,120
39,388
120,556
1,390
111,951
$232,507
Total
98,094
$301,176
2,255
$179,598
$480,774
Monthly Average
19,619
$60,235
451
$35,920
$96,155
Jan
Feb
Mar
110
281
448
7,692,000
9,369,000
14,462,000
1,436
1,896
2,941
46
68
95
February to June 2014 (5 months) monthly average for Barrels of Oil produced was 441. In
March of 2015 the oil production for the month was 448 barrels. The reason why January and
February of 2015 are lower is that this area of the U.S. experienced the worst winter weather
in 50 years, with temperatures frequently dipping down to 5 F to 20 F. Anytime the temperature
gets down under 20 F for a sustained period of time, oil & gas wells have to be shut-in (turned off)
because freezing water can damage the well and tank battery hardware. So the wells had many
days with no production in January and February of 2015 because they were shut-in.
Gas
Oil
(MCF)
(Barrels)
250
244
251
253
257
261
263
263
263
262
261
251
261
260
259
259
266
264
265
263
264
261
262
259
253
245
239
238
237
235
231
7,900
5.43
4.18
5.43
6.26
1.67
6.68
5.01
8.35
5.43
9.6
5.85
7.52
8.35
9.6
8.35
8.35
10.44
10.44
10.44
14.2
9.6
10.44
7.93
12.11
10.44
13.36
12.53
10.86
12.94
11.27
8.35
271.41
5 vertical wells being drilled are not complicated, costly, or risky to drill.
Oil & gas formations are shallow (1,800 to 2,300 ft.) and easy to access.
Targeting 4 primary formations with proven oil & gas reserves.
Low risk, high potential return venture.
Investor friendly venture where investors are treated like partners.
Investors have a significant amount of control and full transparency.
Investors receive 86% of the net income. (very high in the oil & gas industry)
Solid management team with over 50 years of experience in all aspects of the industry .
This is one of
many 3D
Seismic Maps
obtained from
HALCON
Resources
that will be
used to help
define the
best locations
to drill the 5
vertical wells.
Geology Summary
OK HC Project is located in the 26,500 sq. mi. Cherokee Platform Province in SE KS & NE OK.
This oil & gas Province has been highly prolific, since its first oil discovery in 1873.
Since then over 200,000 wells drilled and 431 new oil & gas fields discovered.
5.3 Billion Barrels of Oil and 4.3 Trillion Cubic Feet of Gas produced by 1990 in this Province.
Primary Formations
From 1979 to
1996 the
Bartlesville
Sand produced
90,277,717
Barrels of Oil
Lets look at
how we do Business.
Business Model
Increasing Production = Increase in Cash Flow = Increase in Asset Value
Investor
Participation
$s
Sell Asset at
a Nice
Profit
Cash Flow $s
Cash Flow $s
We Manage
the Project
A New
Oil & Gas Project
Can we make a good profit today with oil at $50 per barrel? Answer: Absolutely
Is there large oil reserves where we will be drilling? Answer: Absolutely
Is oil a good long term play? Answer: Absolutely
The oil market is cyclical . . .
The long term trend for the price of oil is up.
The world runs on oil and that is not going to change any time soon.
We are in it for the long term. We know that the price of oil
will go back up. It is just a matter of how soon and how much.
Answer: Yes
HALCON leases have large untapped underground oil & gas reserves.
Oil and gas is being produced daily from the HALCON wells.
Seismic maps point to the best locations for drilling into large oil & gas reserves.
The 5 new wells will be drilled after analyzing all available geological data.
This is not Wildcat drilling where you drill a hole in the ground hoping to find oil and
its a hit or miss proposition. That type of oil exploration is highly risky.
Risk Continued
Over Promotion It is common for an oil & gas deal to be over promoted. This makes it
difficult for investors to get a decent return on their investment, or any
return at all in some cases. Is the HC-5A Project over promoted?
Answer: No
This HC-5A Project is actually under promoted because investors are getting an unusually
large piece of the pie. They are getting 86% of net revenue. This is very high!
Price of Oil & Profitability Can they be profitable through wild swings in oil prices?
Answer: Yes
Our cost to get a barrel of oil out of the ground is $25 to $30.
So we are in good shape with oil at $50 or $40/barrel.
Even at $35/barrel, we could run a lean and mean operation and turn a profit.
We are in it for the long term and in the long term oil prices are going
to go up based on all the data that is out there on the industry.
Do the Math
Our COST to produce a Barrel of Oil is
$25 to $30. Currently sells for around $60.
= Gross Profit Margin of around $30 to $35 per Barrel
Investing in Oil
Lets look at some of the
important facts.
Oklahoma
Next Exit
Oklahoma
Oklahoma
Oklahoma was averaging 262,000 barrels of oil per day by the end of 2012.
Osage County
Next Exit
Oklahoma Counties
24 Hour
Temporary
Access
www.oklahomaHCproject.com
The website is private and can only be accessed by those investing in the Project.
They are given a Username and Password that enables them to logon to it.
Questions?
Need More Information?