The team of oilmen hoping to strike it rich at Spindletop spent Thursday meeting and greeting would-be investors at the NAPE convention in Houston.
NAPE, formerly called the North American Prospect Expo, is the semi-annual crossroads for oil and gas dealmakers, with hundreds of booths that explain the potential investment waiting for those with a wallet burning a hole in their pocket.
For Bakerfield, Calif.-based E&B Natural Resources and Salt Lake City-based International Petroleum, who are giving investors the chance to buy in on a proposed well targeting the Yegua Formation under Spindletop, it was a busy day. Geologists and land men, investors and competitors alike stopped at the booth, asking Chet Pohle and Brian Kalinec, both geologists on the project, questions about the seismic data that was displayed and why they believe there is yet more money to be made under historical Spindletop.
“The morning has been very busy,” Pohle said. “We have a lot of interest in our project. we have a lot of tire kickers, but we have a lot of people who are truly interested in our project. They are asking how much does it cost, when are we going to drill and what is the basis for drilling the well – and then they want to talk about the technology of how we developed the prospect.”
The two companies have formed a team for the project, with each owning 50 percent of the project, but are hoping to find an additional partner.
For Mark Wixom, vice president of International Petroleum, a small family-owned company that has invested in wells for more than 20 years – including more than 12 years on this project – the buzz that the Spindletop project has created is encouraging.
“Spindletop is definitely the most interesting to everyone,” Wixom said. “We have some resource plays, too, but everyone is always interested in the historical aspect and the technical work we have done since the last show has really answered some questions. I have had a lot of people come back from last year and say, ‘oh, I understand now’ and we expect several follow up appointments from that.”
The venture received about ten leads that they hope to turn into appointments, where they can present their project to potential investors.
“We are diversifying and trying to find partners to minimize the risk,” said Bud Tippens, the director of land for E&B Natural Resources, adding that the partnership would ideally like to sell fifty percent of the project. “We are looking for partners to help us monetize our projects. Twenty-five percent of a deal like this is big enough for anyone.”
But a share of the action still has its price.
“The ten percent cost to buy in is approximately $1.5 million dollars, and you are buying into the entire project – the entire 51 square miles of 3-D data, the 25 net acres that we have under lease,” Tippens said.