Dear Investor January 1, 2017
On behalf of Riverwood we are excited that a successful company like yours is interested in teaming with us in developing our properties and we welcome negotiations and your proposal.
We realize it is challenging in finding good properties with significant upside potential in this price environment and we believe our leases can create significant value. Our properties have remained underdeveloped since the price collapse in 1985/86, and therefore are unique in many respects. While our long lasting litigation battle has capped the value and discouraged investment in the past, we believe our properties still hold significant oil.
You should be aware that these properties have data, back in 1985, of production of over 1700 bpd utilizing enhanced recovery (steam). You are also aware that these properties were purchased at an auction in 2003. Our geoscience report from Bob Dennis indicates 17.5 mmbbl original oil in place with approximately 25% extracted. Based on his findings, this leaves 75% of the OOIP for the Chanac and Etchegon zones on the existing wells only.
In addition, we have the Vedder report, showing a combined 44.7 mmbbl in light crude oil, with more targets including Santa Margarita, Formoso, Olease and others.
We are certainly aware that many major companies in the area had successfully developed the Vedder near our properties.
We believe that the significant upside on our properties is very attractive and can be quite lucrative for any company that teams up with us.
Most of ourinfrastructure is in ‘good to outstanding’ condition, and all permits are up to date.
Knowing all these facts, we believe that our JV will be extremely successful, and as potential business partners, we must believe that we are getting a fair deal on our end and yours as well.
Have a blessed day and we are looking forward to partnering with you on this project.
ROG Team