Replies to post #273960 on Billionaire Boys Club Member Forum (BBCMF)

[fast.money]

ABOUT $BYSD'S BUSINESS

Bayside is focused on growth via the reworking of marginal Oil & Gas wells in mature but marginally producing fields that have significant proven reserves yet to be produced. In many cases, more than 50% of the original recoverable reserves are awaiting oil well remediation technologies such as reworking and recompletions, etc. in order to resume maximum production.

Thousands of mature oil and gas fields across the lower 48 states encompass hundreds of thousands of marginal wells, commonly referred to as ‘stripper’ wells, i.e. wells that produce less than 15 barrels per day of crude oil. Few lay persons realize the importance of these wells and their significance to domestic crude oil supplies. Marginal wells produced more than 335 million barrels of oil in the United States in 2006. That's equivalent to more than 60 percent as much as the United States imports annually from Saudi Arabia.

With approximately 20 percent of American oil production and 10 percent of American natural gas production coming from marginal wells, they are America’s true strategic petroleum reserve.

… Barry Russell,
President and CEO of the Independent Petroleum Association of America.

Many marginal wells are aging wells that have dwindling production as a result of age-related degradation, e.g.: production tubing getting clogged, over time, with sand and other solids that restricts the free flow of the oil (or natural gas.) Bayside’s projects involve primarily aging oil & gas wells whose once-healthy production has dwindled to ‘stripper’ well status despite sufficient proven reserves and reservoir characteristics to support much higher levels of production. Through the application of expertise and technology, Bayside intends to elevate such wells significantly above their current ‘stripper’ status.

By reworking/remediating these wells, i.e. re-entering the well and replacing the clogged production tubing with new tubing, and applying other technologies such as ‘fracing’ and other EOR (Enhanced Oil Recovery) procedures, oil flow rates can be restored to maximum levels of production. In addition to this very attractive rework potential, some of the Company’s mature oil & gas fields also present potential for drilling offsetting development wells to further boost production from the field.

If a given oilfield contains sufficient recoverable reserves – and Bayside’s project selection process ensures this by confining its acquisitions and rework projects to those projects meeting minimum proven reserve requirements and other technical prerequisites – rework procedures will generally succeed in dramatically restoring flow rates, thus boosting oil production by more than an order of magnitude. (From 15 bbls/day to 200 bbls/day+ on many of Bayside’s projects.)