Black Dragon Resource Companies Inc (BDGR)

[LGL8054]

Posted by: caddopineisland

RE-POST of CADDO invaluable Work.
can check on all closing stocks ( thats the amount of oil left in the tank at the end of each month ) on the State of Louisiana/Department of Natural Resources website called "sonris". It will also show monthly production but these figures are submitted by the operator so they may not be factual.Having grown up in the Caddo Pine Island oilfiled, being a petroleum engineer for the past 30 years not to mention living down the street from your Chairman ( house listed for $900K before he almost doubled its size) and eating dinner at the restaurant he bought for his wife on Cross Lake in Shreveport ($1MM) I wish you luck with your company but be advised, there is no way to increase production from the Annona chalk and Nacatoch wells that Black Dragon has purchased. If so the major oil companies ( Amoco, Texaco and Mobil ) would have already done so before they left this area in the late 1980's



Pay no attention to my post. I have only been drilling, completing and producing wells in North Louisiana for the past 30 years and I am currently drilling 15,000' MD horizontal wells, so I believe I am not living in the 1980's. TECHNOLOGY - Great! Horizontal and multi-lateral wells in the Annona chalk will not work. Why? Bottomhole pressure has been reduced to a point that even with the increased drainage area due to a lateral the formation at best will only gravity drain into the lateral.Also, this lateral will require stimulation via hydraulic fracturing and then a problem arises with the recovery of your treatment fluid. With very little bottomhole pressure how are you going to recover your frac fluid? You could jet the wells with either N2 or CO2 via CTU ( coiled tubing unit) but even with $70/Bbl. gross oil prices this would not prove economic on the amount of oil recovered. Enhanced Recovery/Secondary Recovery will not work in the Annona Chalk. Why? Permeability values on the average of 2 md ( that's millidarcy, after Darcy's Law in relation to fluid dynamics, i.e. fluid flow through a porous medium). The Nacatoch wells/reservoirs are water drive reservoirs with a very strong water drive. Oil/Water ratios in these wells are 5/95 at best. A lateral in the Nacatoch would be interesting but how are you going to address fluid loading in the lateral? One concept that has been around since the early 1980's is the mining of the Annona Chalk and a company is currently conducting tests via core tests in Oil City not far from your corporate headquarters. I only wish you luck with your company but keep the words caveat emptor in mind. Thank you for your wishes of a nice day and a very good day to yourself as well.


At the risk of offending " Charts Talk"
June , 2007 production numbers for Four Star.
1144 Bbls oil produced, average of 38 BOPD with the Horne well producing 624 Bbls.of the 1144 Bbls produced in June.This is a lease that could be sold for appx. $500K+. This represents appx. 50 producing leases and a total well count of 409 wells, although some are SWD wells and some are Status 33 wells ( shutin).
Reported Closing Stocks. 2014 Bbls. Please do not place much faith in the closing stock figures. The majority of the Four Star leases have not produced in months and a lease that has not sold oil in months, the closing oil stock is probably not merchantable oil but actually BS&W ( Basic sediment & water), the crude oil purchaser will reject the oil if the BS&W content is too high. I did not run the totals for Petrol Industries ( both Four Star and Petrol show the Lanza's as owners)
If you would like to view these figures for yourself go to
http://sonris-www.dnr.state.la.us./sonlite.htm
Look under " Well Information"
Click on "Wells by Organization"
Enter " Four Star"
Click on " 1822 - Four Star Oil Company"
You can do the same with Petrol Industries. Hopefully your Petrol leases are producing/selling greater production volumes.


Whats Next?

Only one way to save this company. Hire a local petroleum engineer and/or a non-degreed technical professional who knows how to manage and produce stripper oil wells, give this person free rein to run the operations as he sees fit without taking orders from the previous Chairman. Also, place all operations in the name of Black Dragon, i.e. take operations away from Four Star and Petrol, and employ a company owned/company employee workover rig to cut costs as opposed to contract workover rigs. If these leases will not work at $70.00/Bbl oil, they never will. By taking over operations you will also save money by not having to subsidize a dining/entertainment establishment. Good Luck


I am very familiar with the Caddo Pine Island Field, as to Black Dragon leases, I am not sure what "deep rights" they have. I do know that a Smackover propsect under the Gemini acreage under Caddo Lake has been shopped around Shreveport for the past 3 years. I looked at it and passed. I am not sure if Gemini is still a part of Black Dragon although I drive past some wells that were previously owned by Gemini but now have Four Star wellsigns, these wells are on the north shore of Caddo Lake off of the Dawes Road, used to be owned by Allen Brothers. As far as the "deep potential", the Cotton Valley maybe productive but tests to date have not been encouraging. Samson established 3 Cotton Valley units in Mooringsport but they have yet to drill any wells. I believe a recent post by localoil stated that your NRI's ( net revenue interest ) were fairly low due to overrides granted to ???. This would make it difficult to bring a exploration partner in if the NRI's are below 75%. The closest Cotton Valley production is the Longwood Field, south of Mooringsport where they have had some good wells. It just takes a drillbit to find it, that and a checkbook. Good Luck.
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Caddo Thank you for all your post, You have a lot of good info and your contribution is priceless.
Thanks
LGL