A lesson on hydrocarbon accounting and Notes due:
The practice of providing asset values to unproduced hydrocarbons was developed many years ago thanks to accountants and oil industry lobbyists.
Only a handful of firms are allowed to provide these valuations and they can be quite expensive to obtain. The firm that conducted Pilgrim Petroleum’s evaluations was Gustavson and Associates located in Colorado.
Just because a 3rd party engineering firm slaps a rubber stamp on a document saying that the asset is worth X amount of dollars, this never represents the true value of the leasehold interests.
The greatest advantage to utilizing this accounting tool is for the ability to list the company’s stock on a higher value exchange by meeting asset value requirements for that exchange.
I have read many posts and received many emails of shareholders confused by the fact that a $40 million 3rd party valued asset is being sold for a scant $10 million.
Let me assure you, the leasehold interests in question were acquired for a very small sum. Receiving $10 million dollars for these Assets would be a more than fair financial exchange.
I also read posts and emails where shareholders seem to think they are going to receive money based on this asset sale. It is my understanding that this is not the case.
Finally, before I receive any emails or read any public posts concerning a lack of disclosure on this matter one need only look at past financial reports not only from this company but also Arcland Energy. In addition past press releases gave some details to the exchange as well.
The asset exchange Notes come due in a very short period of time and one of three things will occur: 1) Arcland will pay the amount in full and will retain the assets. 2) Arcland will fail to pay the amount owed and the assets will revert back to Pilgrim Petroleum. 3) Some sort of Arcland payment plan will be negotiated by a 3rd party and the Assets will remain in Arcland’s control for an extended duration as long as the payment schedule is maintained.
Shareholders must understand that there are many other financial aspects to this transaction that must be considered in order to make the best possible financial decision on behalf of the company. Some of these involve tax accounting.
Please understand that as an officer of Pilgrim Petroleum it is my ethical responsibility to negotiate the best outcome for the benefit of the Shareholders of this company.
In addition, as public forums have not been officially legally recognized as a public disclosure source this info will be posted on our Company’s website in a timely manner.
Forward-Looking Statements: The statements, which are not historical facts contained in this document are forward-looking statements that involve risks and uncertainties, including but not limited to, the effect of economic conditions, the impact of competition, the results of financing efforts, changes in consumers' preferences and trends.
The words "estimate," "possible," and "seeking" and similar expressions identify forward-looking statements, which speak only to the date the statement was made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, because of new information, future events, or otherwise. Future events and actual results may differ materially from those set forth herein, contemplated by, or underlying the forward-looking statements.
2010 Pilgrim Petroleum Corporation. The information herein is subject to change without notice. Pilgrim Petroleum Corporation shall not be liable for technical or editorial errors or omissions contained herein.
AI
