::::::::::::::::  EOR America Fund  ::::::::::::::::

While the high cost, regulatory risk and uncertainty of being allowed to build a CO2 pipeline to serve an EOR worthy oil field with CO2  limits its use to only the largest oil reservoirs that can justify the multi-hundred million dollar investment of a million-dollar-a-mile CO2 pipeline – there are literally 100s of 1000s of smaller, but no less EOR-worthy, oil reservoirs in which Fossil Bay’s portable CO2 EOR can re-pressurize and revive oil production in   America’s depleted old oil wells at a burdened cost of <$15-$25 per barrel of recovered oil.

Besides attracting Accredited Investors who will appreciate receiving high tax-deductions, high-yield debt repayment and high ROIs from their investment in portable CO2 EOR – the EOR America Fund business model will be especially attractive to independent and major Oil Companies that own currently-inactive, dormant, plugged and abandoned oil leases that previously produced millions of barrels of oil before getting closed decades ago after their primary recovery phases (and have the most to gain from re-pressurizing their oil reservoirs to revive oil production).

Currently, these old and inactive oil field have little or no reserves-value to its owners/shareholders.  But under SEC Oil-Reserves accounting rules (see: http://www.jonesday.com/sec_clarifies_new/) reporting oil companies can classify their currently undeveloped reserves as “proved reserves” if the development plan for those reserves provides for drilling within five years of being booked.”  (see also:  https://www.sec.gov/divisions/corpfin/guidance/oilandgas-interp.htm)

By entering into a 5-Year Portable CO2 EOR Agreement with EOR America Fund, the owners/operators of EOR-worthy oil leases, under SEC-rules, can start to book all of their previously-unbookable reserves as new Proved Reserves (contingent upon a drilling/EOR start-date within 5 years).

With substantially increased reserves-valuations enabled by portable CO2 EOR, every oil company in America could literally leverage as collateral their new Proved Reserves in their old oil leases with the many Reserves Based Lenders who would welcome lending money to produce lower-cost crude oil supplies at <$15-$25 per barrel of recovered oil (since these lenders issued literally hundreds of billions of dollars of debt for shale oil projects that cost over twice as much, and are now underwater at today’s <$50 per barrel oil price).

Because portable CO2 EOR can generate significant profits even with the selling price of oil at $35 a barrel, oil companies that sign a portable CO2 EOR deal with the EOR America Fund can instantly upgrade the low-valuation of their previously unrecognized, currently worth-less oil reserves into  literally tens, and even hundreds, of millions of barrels of high-value Proved Reserves – contingent upon the oil company having a verifiable and contractual “development plan” using Fossil Bay’s portable CO2 EOR technology within 5 years of the new reserves value being booked.

Converting oil reserves that previously could not be collateralized under Reserves Based Lending rules into newly Proved Reserves that can be collateralized (as enabled by our portable CO2 EOR technology) help oil companies by increasing the Borrowing Base Amount of credit available to them – and unlocking the collateral-value of literally billions of barrels of stranded-oil that can now be recovered by implementing portable CO2 EOR in 100s of 1000s of EOR-worthy oil fields in the USA that are currently closed, inactive but still EOR-worthy. http://www.ogfj.com/articles/print/volume-11/issue-3/features/energy-banking-expertise-relationships/reserve-based-finance.html

Mineral Rights owners who have made virtually no Royalty revenues for years since their oil leases stopped producing and got shut-down will now be able to earn new royalties (amounting to >$4-7-million in 25% royalties for every 500,000 barrels of oil recovered), provided that the EOR America Fund / Fossil Bay chooses to spend its investment capital to implement CO2 EOR and revive oil production in their oil reservoirs.

If the mineral rights owners and oil lease operators cannot agree to EOR America Fund terms of agreement to provide its exclusive portable CO2 EOR equipment rights and EOR financing, then such oil lease owner is out-of-luck, because there is no alternative CO2 EOR provider with a CO2 pipeline or low-cost CO2 supply to compete against Fossil Bay’s EOR costs.  This gives Fossil Bay and the EOR America Fund great leverage to make a deal with prospective EOR-worthy oil fields:  Make a fair deal to earn new EOR-enabled royalties and production revenues – or earn nothing like you earn now because there is no other cost-effective way to re-pressurize your oil field to revive production.

This is why independent and major oil companies should be eager to enter into portable CO2 EOR Agreements with the EOR America Fund — because doing so will substantially increase the value of these oil companies by legally booking  literally millions, and even billions of barrels (and dollars) in new Proved Reserves from currently-worthless or under-valued oil leases they already own. http://www.ogfj.com/articles/print/volume-12/issue-3/features/energy-banking-section/rbl-an-attractive-funding-tool.html

With this significant Proved Reserves valuation increase, the combined IDC/EOR tax-deductions and  profit-margin benefits of the EOR America Fund’s portable CO2 business model should make it easier for EOR Fund Managers and its Private Placement Agents to raise all the financing needed from those Accredited Investors, Investment Bankers and Strategic Oil Company Partners who are seeking better-than-stock-and-bond ROIs (that a self-collateralizing direct investment in a Fossil Bay / EOR America Fund CO2 EOR Oil Project can offer).

DISCLAIMER:    Any and all information contained herein, be it technical information, financial projections, cost estimates and or other information, are for educational purposes only and are not an offer to sell or a solicitation to purchase any investment or security, nor convey any financial, tax or legal advice.  The accuracy of the information provided herein may not be relied on for purposes of claiming any federal tax benefits or avoiding any federal tax penalties. You are encouraged to seek financial, tax and legal advice from your professional advisors.  An investment in oil and gas is extremely risky and should only be undertaken by investors who can bear the risks of loss.


Contact:  Larry Shultz, COO

Telephone:   310-980-9091