Hiko Energy Corp. (fka HIKO)

[eom7]

Be nice if they still had any of these:


ITEM 2: PROPERTIES

A. Mining Properties

UTAH: Box Elder County: Registrant owns 80 acres of patented land located in the Grouse Creek Mountains of Northwestern Utah in Box Elder County. This property was the basis for the founding of strategic Minerals, Inc., the original name of the Company prior to the time when the name was changed to Hiko Bell Mining & Oil Company. The Company was founded in 1942. Registrant’s company was incorporated in 1942 for the specific purpose of mining ore to assist the World War II effort in the production of armor resistant steel used in ships and military tanks for the war effort.

Geologic investigations of the area have shown the property to have a high potential value from mineral production of gold and silver. Registrant intends to do a physical sampling of the property in summer and fall of 2007.


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UTAH: Uintah County: Registrant owns 10 placer mining claims located along the Green River in northeastern Utah, 8 miles northeast of the town of Jensen. The claims are accessible year-round by a gravel road that is maintained by Uintah county. The gold content of the gravels ranges from .05 to .08 ounce per ton. The gravels on the property have been calculated to contain 2.5 million ounces of gold in the 20 million cubic yards of material. The ore also contains an estimated 2.5 million ounces of silver. Engineering data indicates that the average value of the ore, screened to a minus ¼” is $121.46 per ton, having calculated that value using the price of gold at $380 per ounce, with the price now currently in excess of $600 per ounce. The cost of mining, concentrating and refining, using that parameter, is estimated to be $32.25/ton. This would give the operation a Net profit of $89.20/ton, before taxes. Based on a 2500 ton per day operation, utilizing 300 working days per year, annual pre-tax revenue could be around $40,000,000. Estimated plant and equipment costs are $8,360,000.

The economic feasibility of the project should be preceded with a bench scale model to determine the economic viability of a large-scale operation. The efficiency of the four gold recovery process will be the determining factor as to whether or not the project will be economically viable, a factor yet to be determined. Technical and environmental studies will have to be conducted. The plans will have to be submitted to the Bureau of Land Management, the State of Utah Geological Survey, the state Office of Water Quality and other appropriate governmental agencies for approval, before mining operations can be undertaken. The time frame for this work is estimated to be one year at an estimated cost of $350,000, including Federal and State environmental bonding.


B. Utah Oil and Gas Properties

UTAH: Duchesne County: Registrant owns mineral interests within the Duchesne City and in the Indian Canyon area. These mineral rights are presently not leased.

UTAH: Uintah County: Coyote Basin Area: Registrant has overriding royalties in two oil and gas leases that are presently operated by Houston Exploration Co. Two Uinta formation gas wells are located on the leases. It is probable the gas development drilling on this acreage will begin during 2006. The leases are “held by production”(HBP).

UTAH: Uintah County: Asphalt Ridge Area: Registrant has mineral interests in the Asphalt Ridge area west of Vernal, Utah. The mineral interest is not presently leased.

UTAH: Uintah Basin: Registrant owns producing royalties under wells operated by El Paso Natural Gas and by Devon energy. These wells are located in the Bluebell-Altamont oilfield. New drilling and exploration development wells on lands under registrant’s royalties will add new reserves of gas and oil to Hiko Bell’s inventory in the future.

UTAH: Uintah County: Registrant had a Working Interest in a field in western Uintah County, Utah, which it sold to Newfield Exploration Company.


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NEVADA: In December, Registrant filed on approximately 26,000 acres of federal oil and gas leases in Clark, Nye, and Elko Counties of eastern Nevada.

The discovery of the Wolverine King’s Ranch oilfield in Sevier County, Utah has created a high interest among geologists, landsmen and oil companies in the “hinge line” overthrust belt of western Utah and eastern Nevada. The recently accepted revisions of structural geology have been revised through drilling and seismic work to open up a new interpretation of oil and gas exploration. The acceptance of plate tectonic by the earth scientist, combined with the use of thermal maturity of source rocks have led to the basic discoveries of oil and gas in Wyoming, Utah and Nevada. Registrant’s exploration division has been conducting geologic studies of four prospects on their acreage portfolio. Management has been in discussion with an investor group on a possible million dollar exploration and development program on the Nevada leases.