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| TSXV: SDX |
$0.10 |
| change |
+0.005 |
| date |
24-May-13 |
| time |
3:58pm |
| volume |
485800
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| 15 min delay |
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Tuesday, May 20, 2008
May 20, 2008
Dear Shareholders:
I would like to share some very exciting developments concerning your company over the past few months.
The Company completed drilling 4x well (which was spudded before the 17th July 2007 deadline) in September 2007. Unfortunately, the well did not encounter hydrocarbons but gave us valuable information in respect to oil migration and the structure of the fault line. With this information your management believe the oil migration did not cross the fault line and therefore we now will focus our efforts on the offshore Dahab prospects on the Eastern side of the block. We asked Chapman Engineering to update their engineering report and based on a P 50 probability (including Monte Carlo Simulations) they have identified 528 million barrels of oil in four separate prospects. Based on a 25% conservative recovery means 132 million barrels of recoverable oil and the Company share based on the concession fiscal terms is almost 34 million barrels oil. We have had geologists and geophysicists track the oil migration routes and recommend drilling targets in these offshore prospects.
In December 2007 your Company commenced negotiating a transaction with Egypt Oil Holdings Ltd. to acquire an additional 35% interest in the East Wada Araba concession. Egypt Oil Holdings acquired this interest from Mogul Energy International, Inc. and Dover Investments Ltd. This deal was concluded in April 2008 and in consideration for this acquisition the Company issued 24,000,000 shares. Of the shares issued 90% or 21,600,000 shares are Escrowed and will not become freely tradable until the drilling of the second well on Dahab is completed or July 31, 2009.
The Company received approval from Egyptian General Petroleum Corporation (EGPC) and the Arab Republic of Egypt on the Deed of Assignment for the transfer of a full 75% of the EWA Concession to the Company on March 24th 2008. Now that the Company has its 75% working interest in the concession and four separate non-contingent prospects it has made the election to go into the next phase of the Concession through Dover Investments Ltd. (the Operator) which was accepted by EGPC.
We initially raised C$7.5 Million through the issue of an interest free, unsecured convertible debenture. The debenture was fully subscribed by January 2008. The proceeds of this debenture were used to fund a Letter of Guarantee to EGPC to secure the Company's obligation to fund the drilling of the next two wells. In addition, the Company had to pay the balance of the previous 4-x well and provide some working capital to take the Company public. These debentures are expected to be converted at the time the Company goes public.
Your Company has budgeted the cost of hiring a jack up rig to drill the Dahab prospect wells and estimated that it will cost approximately $10 million per well plus additional costs for seismic and working capital. A minimum of three wells and a maximum of four wells are planned to meet this commitment. Concurrent with the initial public offering, the Company intends to list on the TSX Venture Exchange. We anticipate the possibility of raising additional funding subscriptions which will permit us to extend our drilling program and drill additional prospects as well as commence looking at other opportunities possibly with a view to acquiring producing assets. The preliminary prospectus has been filed and the road show will start very shortly. We have engaged the services of Salman Partners Ltd; Thomas Weisel and Fraser Mackenzie to assist in the fundraising.
At the insistence our Agents we have approached all the founding shareholders (including all management) and asked them to Escrow 90% of their share holdings (similar to Egypt Oil shareholders). I am pleased to announce that we already have received commitments from the largest share holders to support this including all management. This will still permit 10% of the original stock and the warrants to be free trading when the Company is publicly traded.
We have expanded our Board of Directors in anticipation of going public shortly. We have three independent directors to match the three executive directors of the company (namely Ahmed Moaaz; Parvez Tyab and myself). We are delighted to announce that Said Arrata, former Chairman and CEO of Centurion Energy International and Barry Swan, former CFO of the same Company have both agreed to join our Board. Said has also accepted to take on the position as Chairman. David Wilson former senior Director of Nations Energy has also agreed to join our board of directors. This gives the Company a very balanced board of directors with an incredible oil and gas background.
We thank you for your continued support and will keep you posted on our progress.
David M. Thompson
President and CEO
E-mail: david@seadragon.ca
Go Back
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Friday, May 24, 2013
Q1 2013 Financials Released
Monday, May 20, 2013
OilBarrel Presentation
Monday, April 22, 2013
New Exploration Block Acquired
Monday, April 15, 2013
Paul Welch appointed as President and CEO
Friday, April 12, 2013
Fourth Quarter and Year End Financials Announced
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Q1 2013 Interim Financial Statements