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Presents

Presents. DIRECT INVESTMENT IN OIL AND GAS RESERVES. The United States and Canada Allow Private Ownership of Oil and Gas Resources. Most of the World’s Reserves are Nationalized or Held by Sovereigns. The United States and Canada Allow

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Presents

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  1. Presents DIRECT INVESTMENT IN OIL AND GAS RESERVES

  2. The United States and Canada Allow Private Ownershipof Oil and Gas Resources

  3. Most of the World’s Reserves are • Nationalized or Held by Sovereigns The United States and Canada Allow Private Ownership of Oil and Gas Resources

  4. Most of the World’s Reserves are • Nationalized or Held by Sovereigns • The US and Canada have Clear and Established • Legal Structures to Protect Private Property Rights The United States and Canada Allow Private Ownership of Oil and Gas Resources

  5. The United States and Canada Allow Private Ownership of Oil and Gas Resources • Most of the World’s Reserves are • Nationalized or Held by Sovereigns • The US and Canada have Clear and Established • Legal Structures to Protect Private Property Rights • Private Property Rights are Critical to Their Culture • and Support Economic and Political Identity

  6. Transparency The United States and Canada Allow Private Ownership of Oil and Gas Resources

  7. The United States and Canada Allow Private Ownership of Oil and Gas Resources • Transparency • Heavily Regulated Industry

  8. The United States and Canada Allow Private Ownership of Oil and Gas Resources • Transparency • Heavily Regulated Industry • Oil and Gas Production Reported Publicly

  9. The United States and Canada Allow Private Ownership of Oil and Gas Resources • Transparency • Heavily Regulated Industry • Oil and Gas Production Reported Publicly • Internet Access to Data

  10. Oil and Gas Industry is an Efficient Micro-Economic Business Model

  11. The World’s Strongest Economy Sets Market Prices Oil and Gas Industry is an Efficient Micro-Economic Business Model

  12. Oil and Gas Industry is an Efficient Micro-Economic Business Model • The World’s Strongest Economy Sets Market Prices • Market Prices Established in New York or London… • (No Volume Discounts)

  13. Oil and Gas Industry is an Efficient Micro-Economic Business Model • The World’s Strongest Economy Sets Market Prices • Market Prices Established in New York or London… • (No Volume Discounts) • 100% of Supply is Sold… • (at Highest Market Prices)

  14. Oil and Gas Industry is an Efficient Macro-Economic Business Model

  15. Oil and Gas Reserves have become an • International Currency Oil and Gas Industry is an Efficient Macro-Economic Business Model

  16. Oil and Gas Industry is an Efficient Macro-Economic Business Model • Oil and Gas Reserves have become an • International Currency • US Dollar Denominated

  17. Oil and Gas Industry is an Efficient Macro-Economic Business Model • Oil and Gas Reserves have become an • International Currency • US Dollar Denominated • Exchange Traded. (Provides Liquidity) • SEC & FTSE Valuation Standards

  18. Oil and Gas Industry is an Efficient Macro-Economic Business Model • Oil and Gas Reserves have become an • International Currency • US Dollar Denominated • Exchange Traded. (Provides Liquidity) • SEC & FTSE Valuation Standards • Tangible Asset with Cash Flow

  19. Three Stages of Activity in an Oil Field

  20. Three Stages of Activity in an Oil Field • Exploration: • Very High Risk, • Very High Reward

  21. Three Stages of Activity in an Oil Field • Exploration • Developmental: • Low Risk, • High Reward

  22. Three Stages of Activity in an Oil Field • Exploration • Developmental • Reserve Asset: • Very Low Risk, • Modest Reward

  23. SK & CO Specializes in Developmental Oil and Gas Projects

  24. Purchase Existing Production SK & CO Specializes in Developmental Oil and Gas Projects

  25. Purchase Existing Production • Extend Scientific Data SK & CO Specializes in Developmental Oil and Gas Projects

  26. Purchase Existing Production • Extend Scientific Data • Acquire Additional Acreage SK & CO Specializes in Developmental Oil and Gas Projects

  27. Purchase Existing Production • Extend Scientific Data • Acquire Additional Acreage • Commence Developmental Drilling SK & CO Specializes in Developmental Oil and Gas Projects

  28. Return of Investment precedes Return on Investment

  29. Typical Oil or Gas Well Returns • 100% of Investment in 18-24 Months Return of Investment precedes Return on Investment

  30. Return of Investment precedes Return on Investment • Typical Oil or Gas Well Returns • 100% of Investment in 18-24 Months • 20 to 30 Years of Production Follows • Return of Capital

  31. Return of Investment precedes Return on Investment • Typical Oil or Gas Well Returns • 100% of Investment in 18-24 Months • 20 to 30 Years of Production Follows • Return of Capital • Remaining Reserves Decline Over Time • and Are Valued Accordingly

  32. Unique Financial Model

  33. SK & Co. Reinvests Cash Flow From Current • Production Into Further Developmental Drilling Unique Financial Model

  34. Unique Financial Model • SK & Co. Reinvests Cash Flow From Current • Production Into Further Developmental Drilling • Minimizes The Use of Capital

  35. Unique Financial Model • SK & Co. Reinvests Cash Flow From Current • Production Into Further Developmental Drilling • Minimizes The Use of Capital • Compounds Returns Without the Risks of Leverage

  36. Summary of Proposal

  37. Summary of Proposal • Avoid Exploration Risks by Purchasing Existing • Production

  38. Summary of Proposal • Avoid Exploration Risks by Purchasing Existing • Production • Expand Reserves with Developmental Drilling

  39. Summary of Proposal • Avoid Exploration Risks by Purchasing Existing • Production • Expand Reserves with Developmental Drilling • Use Reinvestment of Cash Flows to Compound • Returns Without Use of Leverage

  40. Summary of Proposal • Avoid Exploration Risks by Purchasing Existing • Production • Expand Reserves with Developmental Drilling • Use Reinvestment of Cash Flows to Compound • Returns Without Use of Leverage • Sell Developed Field, (Reserves) to Major Oil Companies

  41. Summary of Proposal • Avoid Exploration Risks by Purchasing Existing • Production • Expand Reserves with Developmental Drilling • Use Reinvestment of Cash Flows to Compound • Returns Without Use of Leverage • Sell Developed Field, (Reserves) to Major Oil Companies • 5 to 7 Year Exit Strategy

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