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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 - PowerPoint PPT PresentationTRANSCRIPT
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Presents
DIRECT INVESTMENT IN OIL AND GAS RESERVES
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The United States and Canada Allow Private Ownership of Oil and Gas
Resources
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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
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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
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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
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The United States and Canada Allow Private Ownership of Oil and Gas
Resources
Transparency
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The United States and Canada Allow Private Ownership of Oil and Gas
Resources
Transparency• Heavily Regulated Industry
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The United States and Canada Allow Private Ownership of Oil and Gas
Resources
Transparency• Heavily Regulated Industry
• Oil and Gas Production Reported Publicly
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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
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Oil and Gas Industry is an Efficient Micro-Economic Business Model
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Oil and Gas Industry is an Efficient Micro-Economic Business Model
• The World’s Strongest Economy Sets Market Prices
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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)
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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)
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Oil and Gas Industry is an Efficient Macro-Economic Business Model
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Oil and Gas Industry is an Efficient Macro-Economic Business Model
• Oil and Gas Reserves have become an International Currency
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Oil and Gas Industry is an Efficient Macro-Economic Business Model
• Oil and Gas Reserves have become an International Currency
• US Dollar Denominated
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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
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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
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Three Stages of Activity in an Oil Field
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Three Stages of Activity in an Oil Field
• Exploration:Very High Risk, Very High Reward
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Three Stages of Activity in an Oil Field
• Exploration
• Developmental:Low Risk, High Reward
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Three Stages of Activity in an Oil Field
• Exploration
• Developmental
• Reserve Asset: Very Low Risk, Modest Reward
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SK & CO Specializes in Developmental Oil and Gas Projects
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SK & CO Specializes in Developmental Oil and Gas Projects
• Purchase Existing Production
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SK & CO Specializes in Developmental Oil and Gas Projects
• Purchase Existing Production
• Extend Scientific Data
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SK & CO Specializes in Developmental Oil and Gas Projects
• Purchase Existing Production
• Extend Scientific Data
• Acquire Additional Acreage
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SK & CO Specializes in Developmental Oil and Gas Projects
• Purchase Existing Production
• Extend Scientific Data
• Acquire Additional Acreage
• Commence Developmental Drilling
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Return of Investment precedes
Return on Investment
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Return of Investment precedes
Return on Investment
• Typical Oil or Gas Well Returns 100% of Investment in 18-24 Months
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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
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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
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Unique Financial Model
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Unique Financial Model
• SK & Co. Reinvests Cash Flow From Current Production Into Further Developmental Drilling
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Unique Financial Model
• SK & Co. Reinvests Cash Flow From Current Production Into Further Developmental Drilling
• Minimizes The Use of Capital
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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
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Summary of Proposal
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Summary of Proposal
• Avoid Exploration Risks by Purchasing Existing Production
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Summary of Proposal
• Avoid Exploration Risks by Purchasing Existing Production
• Expand Reserves with Developmental Drilling
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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
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Summary of Proposal
• Avoid Exploration Risks by Purchasing Existing Production
• Expand Reserves with Developmental Drilling
• Sell Developed Field, (Reserves) to Major Oil Companies
• Use Reinvestment of Cash Flows to Compound Returns Without Use of Leverage
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Summary of Proposal
• Avoid Exploration Risks by Purchasing Existing Production
• Expand Reserves with Developmental Drilling
• Sell Developed Field, (Reserves) to Major Oil Companies
• Use Reinvestment of Cash Flows to Compound Returns Without Use of Leverage
• 5 to 7 Year Exit Strategy