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KFG.V - KFG Resources Ltd. (Southern US Light Oil Production)
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Thread: KFG.V - KFG Resources Ltd. (Southern US Light Oil Production)
StockDude
The Company is a small independent energy company engaged in the development of onshore oil and gas reserves with activities concentrated in Concordia and Catahoula Parishes, Louisiana, Adams, Jefferson, and Wilkinson Counties, Mississippi and Comanche County, Kansas.
KFG Q3 Results Ending January 31st 2015
Note: All numbers are in US Dollars which means there should be a 20% conversion to accommodate the TSXV listed security.
Common Shares: 50,584,144
Insider Holdings: 17% or just over 8.5 million shares as per SEDI
Cash: $2,133,800 (Q2 Cash: $1,836,298) (Q1 Cash: $1,133,429) – almost 100% increase from Q1 to Q3
Accounts Receivable: $238,843
Prepaid Expenses: $39,428
Reclamation bond: $20,000
Property and Equipment: $1,250,967
Total Assets: $3,693,038
Accounts Payable: $464,480
Deposits from co-owners: $598,351
Total Liabilities: $1,062,831
Revenue After 9 Months
Oil and Gas: $1,938,528
Management Fee’s: $330,010
Net Income: $492,487
EPS: $0.01
MD&A Highlights
For the nine months ended January 31, 2015, the Company had cash flow from oil and gas production of $1,469,120, compared to $1,116,992 for the nine months ended January 31, 2014. Oil production increased from 77.51 BOPD to 105.06 BOPD, and gas production decreased 1.19 MCF per day. The average price of gas increased $0.38 per MCF and the average price of crude oil decreased $15.05 per bbl when comparing the nine months ended January 31, 2015 and January 31, 2014.
Overall, the Company has recovered from giving up 25% of its interested in the Fayette Field wells at payout. Currently, with the MacNeil wells and Craig wells at payout, revenues are on a growth pattern again. The Company was able to grow just utilizing cash flow. Several new projects are in the pipeline and the Craig #3 well will payout in the next few months, increasing that revenue stream. KFG will have no problems financing growth through its internal cash flow throughout the remainder of its fiscal year ending April 30, 2015. In addition, the Barnum #2 well is on production as of mid September 2014. The Craig #4 well was recently completed as a dryhole. With the Company’s current cash position, the Company is in a good position to weather the current collapse in oil prices from about $84 in October 2014 to around $55 - $60/bbl at this writing and will still show positive cashflow. The Company’s operating cost per bbl is currently $18.85/bbl. Currently, the Company has two wells awaiting completion drilled in February 2015 – both in Adams county. The Barnum #3 well encountered the main field zone in the Parker sand at 6,400’. The Company has a 9% working interest in the well converting to a 20.55% working interest at payout. The Craig #5 well encountered the main pay zone at 1,300’ and an additional oil zone at 10,214’. The Company has a 21.5% working interest in this well. With $2,133,800 in cash, the Company is well positioned to weather the current price collapse in crude oil. KFG has a current ratio of 2.27 to 1.
During the quarter ended January 31, 2015, the Company saw a major price collapse in the price of crude oil resulting in revenues of $446,746 compared to the prior quarter’s revenue in excess of $800,000. Greatly lower costs during the period allowed the Company to limit its losses compared to the corresponding quarter ending January 31, 2014. With its cash position and lack of debt, the Company is well positioned and is not planning to cut back its exploration and development.
The Company’s main sources of liquidity are internally-generated cash flow from its oil and gas operations. Because KFG’s internally-generated cash flow is presently sufficient to fund its overall operating expenses, the Company will not require additional funding from equity capital markets in order to execute on its business strategy. A decline in the prices of natural gas and oil, could materially and adversely impact on KFG’s ability to secure partners in drilling projects, with the result that the Company may be forced to scale back its operational activities.
KFG had cash at January 31, 2015 of $2,133,800. Oil production at Fayette is providing positive cash flow and will continue to do just that. As of now, the Company plans to expand as cash flow permits. The Company is experiencing new cash flow from the Craig #1 and #2 wells, and the MacNeil #2 and #3 wells as well as having the Dale lease back on line. Also in the quarter, the Craig #3 well was completed; producing 50 BOPD and the Barnum #2 well was completed and is now producing to 80 BOPD. In addition, the Craig #1 and #2 and the MacNeil #2 and #3 have paid out causing the Company’s revenue from those wells to more than double. Even at current prices, the Company is producing positive cash flow.
In January and February 2015, the Company drilled 4 wells. Two dry holes in Franklin County, MS where the Company’s exposure was limited to 10% in each dry hole and two development wells – the Craig #5 and the Barnum #3 that are still awaiting completion due to bad weather. In the Craig #5 well, the Company has a 21.5 % working interest and it is expected to be a large source of new revenue once completed and on production. There are no plans at present to curtail the Company’s programs.
The Company is not contemplating any other transactions which have not already been disclosed. The Company continues to look at other property acquisitions and to seek joint venture partners on its properties on a regular basis.
The total number of shares outstanding as at January 31, 2015 and March 27, 2015, is 50,584,144. As of January 31, 2015 and March 27, 2015, there were no stock options or warrants outstanding.
Production at Fayette is stable and has started a slow decline. With the Dale lease back on production and new production coming off the Craig and Parker leases, KFG will have adequate internal cash flow to develop existing leases as well as support several new prospects in the coming months. The Company’s outlook for the next twelve months is positive. With a current ratio of 2.27, KFG is well positioned to prosper during this period of much lower oil prices. In January and February 2015, KFG drilled 4 wells – two shallow dry holes in Franklin, Co. MS and two successful development wells in Adams Co. MS – the Barnum #3 and the Craig #5. Both wells are waiting on completion. Five new projects are in various stages of completion and are expected to be ready to drill by early summer. There is also development still to be done on the Barnum and Craig leases.
New Institution buying KFG Resources. http://dearbornpartners.com/ based out of Chicago. See the breakdown below:
Ownership - Summary : KFG Resources LtdMost Recent
Macro:	Energy	Free Float:	42,372,902	Filing Status:
Current Period - 14.29 %
Mid:	Energy	Free Float % O/S:	84%	31-Mar-2015 - 28.57 %
Micro:	Oil & Gas (Exploration & Production)	Shares Outstanding:	50,584,144	31-Dec-2014 - 0.00 %
Ticker:	KFG-V	Exchange:	TSX Venture Exchange	Market Cap ($MM):	3501631.000000
Investor Type	Investors	% O/S	Pos	Val ($MM)
Investment Managers	1	0.44	225,000	0.02
Brokerage Firms	0	0.00	0	0.00
Strategic Entities	6	16.23	8,211,242	0.59
Holding Companies	0	0.00	0	0.00
Corporations	0	0.00	0	0.00
Individuals	6	16.23	8,211,242	0.59
Government Agency	0	0.00	0	0.00
Total - All Holders	7	16.68	8,436,242	0.61
Insider Filings (As Reported)
Insider	5	16.39	8,290,900	0.00
Investor Style
Investor Style	Investors	% O/S	Pos	Val ($MM)
Core Growth	1	0.44	225,000	0.02
Location:Metro Area
Location	Investors	% O/S	Pos	Val ($MM)
Chicago & Suburbs	1	0.44	225,000	0.02
Location:Global Region
Location	Investors	% O/S Pos	Val ($MM)
N. America	7	16.68	8,436,242	0.61
Location:Country
Canada	3	11.94	6,041,000	0.48
United States	4	4.74	2,395,242	0.13
Rotation	Investors	% O/S	Pos	Val ($MM)
Buys	2	12.28	6,211,000	0.49
Buy-Ins	1	0.44	225,000	0.02
Position Increase	1	11.83	5,986,000	0.48
Sells	1	2.00	1,009,502	0.07
Sell-Outs	0	0.00	0	0.00
Position Decrease	1	2.00	1,009,502	0.07
No Change	4	2.40	1,215,740	0.04
Turnover	Percentage
High	0.00
Mod	0.00
Low	14.27
All	16.68
Top Ten Investors
Investor Name	% O/S	Pos	Pos Chg	% Pos Chg	Filing Date	Filing Type	Equity Assets ($MM)	Investor Type	Country
Haney (Kevin)	11.83	5,986,000	6,000	0.10	02-Apr-2015	Canadian Insider Data	0.49	Strategic Entities	Canada
Guido (G Stephen)	2.01	1,018,740	0	0.00	16-Aug-2013	Proxy-CA	0.03	Strategic Entities	United States
Kadane (Robert Andrews)	2.00	1,009,502	-50,000	-4.72	20-Feb-2015	Canadian Insider Data	0.07	Strategic Entities	United States
Dearborn Partners L.L.C.	0.44	225,000	225,000	100.00	31-Mar-2015	13F	1,147.57	Investment Managers	United States
Kadane (Elizabeth Jean)	0.28	142,000	0	0.00	16-Aug-2013	Proxy-CA	0.00	Strategic Entities	United States
Raftery (Michael P)	0.09	45,000	0	0.00	16-Aug-2013	Proxy-CA	0.00	Strategic Entities	Canada
Pople (Keith N)	0.02	10,000	0	0.00	16-Aug-2013	Proxy-CA	0.00	Strategic Entities	Canada
Source: Thomson Financial
KFG's Craig No. 5 well flows 98 bopd
2015-04-27 13:36 MT - News Release
Mr. Robert Kadane reports
KFG OPERATIONS UPDATE
KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp., and its partners have completed the Craig No. 5 well in Adams county, Mississippi, flowing 98 barrels of oil per day, no water, on an eight-64th choke, with flowing tubing pressure of 300 pounds per square inch. The company has a 21.5-per-cent working interest in the well. Barnum No. 3 completion operations are under way. Additionally KFG is gearing up for an active summer in Mississippi with several new projects.
© 2015 Canjex Publishing Ltd. All rights reserved.
Last quarter KFG was producing at 105bopd. Including this well, the company will be closer to 130bopd since their declines are almost non-existent. Barnum 3 should add some good production, Craig 3 pays out in June, and the next several wells should give KFG the potential to double it's last quarter production numbers.
New article on KFG Resources from PennyStockExperts:
http://pennystockexperts.com/attract...our-attention/
Attractive, Smart, and Relatively Wealthy Oil Operator Seeks Your Attention
Let’s face it, mainstream financial media has trained investors to think shale plays like Bakken, Eagle Ford, Marcellus et al. are the only game in town.
Now I’m no T. Boone Pickens, but I know they’re ignoring more than a few proven oil fields.
Disregarding conventional projects in favor of shale could continue to be a costly mistake for investors and operators alike moving forward.
Like a moth to a flame…
After harnessing the power of horizontal drilling, the oil industry was drawn toward hydraulic fracturing and shale like a moth to a flame. As a whole, it abandoned conventional shallow prospects, historically its bread and butter, and flew directly toward the orange yellowish glow of this newer (dare I say sexier) more controversial technique.
Easy money leads to oversupply.
Thanks to an era of easy money and $100 per barrel pricing, banks, brokers, and their clients lent to just about anyone willing to borrow. Therefore, oil operators took the money. And I guess they had to, those fancy horizontal wells don’t come cheap, each one can cost over $10 million.
As you can imagine… the bills start adding up quickly.
Thousands of wells would never have been drilled if cash from operating activities were the only funds available. Levering up ruled the day! Even sub-par outfits were able to borrow, borrow, and borrow some more, betting they could pay back lenders after oil prices continued rising.
Long story short, drilling successes contributed to an oversupplied market (we’ll save the other factoids for another day), and lots of bettors got it wrong. Nearly all shale projects need at least $60 WTI to break even, some would argue much higher, so many oil companies are now facing a life and death situation.
If we break the industry down into three groups, here’s my interpretation:
1) Those who got burned flying too close to the orange yellowish glow [bankrupt]
2) Those who levered up and are forced to run faster to stay ahead of debt collectors [borderline delinquent]
3) Those who operated during the boom expecting a bust someday [healthy, strong, and control destiny]
Which of the three would you be attracted to?
Simplicity is back in fashion.
With enough time, what’s old always seems to become new again. Conservative, conventional operators like KFG Resources (CVE: KFG) (OTCMKTS: KFGRF) and its CEO Robert A. Kadane now look like the smartest guys in the room. Bob, as he prefers to be called, has first-hand experience spanning forty years. As a youngster he watched, learned, and then helped his dad manage a small fleet of drilling rigs back when oil was 40 cents a barrel. Maybe you’ve heard or know about guys who run around in Armani suits calling themselves “oil man”? You’ll see them more frequently during the boom times
… well that’s not Bob!
Granted, marketing and promotion aren’t his strong points, just look at KFG’s website. Rough around the edges, maybe, but Bob understands the oil business and knows how to run a tight ship, and that’s most important for KFG’s long-term success. Looking for proof of concept? Prime Energy (NASDAQ: PNRG) is a $135 million dollar exchange listed company Bob built and ultimately sold before starting his next venture… KFG Resources.
KFG controls its own destiny…
With help from his team, including G. Stephen Guido of Shamrock Drilling, Bob and KFG Resources have time to think wisely and make strategic moves aimed at creating shareholder value. Unlike many of its peers, whom are weighed down by debt or already bankrupt, KFG Resources controls its own destiny.
While the industry was chasing the latest and greatest shale play(s), bidding up prices, KFG Resources stayed true to what it knows best, low-cost high return conventional opportunities, primarily in Mississippi and Louisiana.
Hold it… “Low cost high return”? Isn’t that what everyone is looking for, the kind of deal you only hear about from pitchmen, too good to be true type stuff.
Well, yes and no, please stay with me.
Hitting it where they ain’t!
To use a baseball analogy: drilling one of those fancy $10 million dollar horizontal wells into the Eagle Ford or Bakken is equivalent to swinging for the fence. You either hit a homerun or strikeout, there isn’t much room in between, success or failure.
Hitting homeruns are great! But the oil business can be less forgiving than MLB when it comes to strikeouts. Therefore, every winning baseball team (or portfolio of oil assets) needs players who get on base 30-40% of the time, and keep dry holes (strikeouts) to a minimum.
Occasionally, KFG Resources will hit a homerun, like it did recently with Craig #5, this well paid back its initial investment in just 8 weeks! But singles and doubles are also in its game plan. Inevitably, dry holes will and have occurred, but with drilling costs under $350,000 (less than 4% of a horizontal), KFG Resources should always be able to take another swing at its best geological targets.
I can assure you, Wall Street and Bay Street are overlooking KFG Resources because of its small stature, but to me that’s part of its appeal. In my experience, independent investors improve their odds of success and make more money by hitting it where the professional analysts aren’t— then selling to them at a premium later.
Bottom Line: With proved crude oil reserves of 247 million barrels, as of Dec. 2010, Mississippi exhibits strong potential for the development of oil and gas reserves. KFG Resources manages risk by working with loyal partners who co-invest; it maintains a 10%-59% interest in 26 producing wells. Additionally, it earns monthly revenue per well as operator and servicer. Finally, the metrics work, Craig #5 cost approximately $300,000 to complete, so for $65k (KFG’s 21% stake) it added 20 barrels of oil per day>>> roughly $438,000 in annual revenue at $60 per barrel>>> for KFG’s $65,000 investment! Obviously, that discovery wouldn’t move the needle for Exxon Mobil, but it’s a homerun for KFG, and with any luck it expects to hit a few more like Craig #5 this summer.
*Disclosure: author is establishing a long position in KFG Resources
KFG Resources restarts production at all wells
KFG Resources Ltd.'s subsidiary KFG Petroleum Corp.'s Craig No. 5 well, which was put on production in May, 2015, in Adams county, Mississippi, continues to produce 100 barrels of oil per day water free. The company has a 21.5-per-cent (16.025-per-cent net) interest in the well. The Barnum No. 3 well is still undergoing production testing, although results to date are disappointing. KFG's interest in the Barnum well is 9 per cent (6.75 per cent net).
The price of crude oil in May was $60.50, bringing all production back into positive territory. All production is finally back on-line after the wettest five months in memory. A few wells were down periodically in KFG's fiscal third quarter ending Jan. 31, 2015, and in the company's last fiscal quarter ending April 30, 2015. The last well that was down is back on production this week. Weather conditions made it extremely hard to get wells back on-line in a timely fashion.
The company's drilling program should be under way in about 30 days. It is anticipated, at present, that there will be five exploratory wells, and one or two development wells in the program.
KFG Financial Comparison Chart (Audited Annual Financials From 2008 to 2015)
I made this financial comparison show everyone where KFG is after years of gains and setbacks. It's been a long journey, but after much trial and error, this company has finally found the best way to grow itself. Despite low oil prices and weather trying to stop the company, this just won't happen. KFG is now a self sufficient oil junior and is more than capable of doubling or tripling its production on a yearly basis. This will inevitably increase revenue, cash position and net income which could lead to a dividend, share buyback or even takeover of the company. Please see below for a break down of every Audited Year End financial report.
KFG Year End Results in 2008
- Cash: $2.66M, Total Assets: $2.96M, Total Debt: $553K
- Revenue: $798K, Net Loss For The Year: -$64K
- Shares Outstanding: 30,874,646
- This was before the global crisis. KFG was trading around $0.15c and still raising money. Total was 25 million shares which is half of the entire O/S right now and a major cash injection. However this was done at a lower price.
- Cash:$1.62M, Total Assets: $2.33M, Total Debt: $156K
- Revenue: $645K, Net Loss For The Year: $456K
- Additional Funds Raised
- Cash: $304K, Total Assets: $1.84M, Total Debt: $640K
- Revenue: $997K, Net Loss For The Year: -$1.4M
- Revenue: $2.9M, Net Income For The Year: $832K
- This was a milestone year because KFG hit a string of wells(Fayette) that helped them recover from the financial crisis. Some assets were also sold and funds raised as well. The stock went back to the teen price range this year.
- Additional Funds Raised.
- Revenue: $3.5M, Net Loss For The Year: $144K
- Despite the record profit, KFG took a major risk this year and unfortunately lost. Drilling a 100% interest Tuscaloosa well which cost the company over $1 million USD and it did not work out. This is why KFG’s strategy changed from solo wells to JV wells in multiple areas.
- Cash: 861K, Total Assets: $2.5M, Total Debt: $430K
- Revenue: $3.05M, Net Income For The Year: $76K
- Shares Outstanding: 50,584,144(Some shares cancelled and this is the current share structure.
- This was the year where KFG started to diversify into multiple wells rather than just rely on the 9 Fayette and do a couple 100% interest wells.
- Revenue: $2.7M, Net Income For The Year: $67K
- The reason why revenue went down this quarter was due to the fact that the 9 Fayette wells paid out from 75% to 59%, along with additional costs from doing other wells. However, new production was put in place to replace the lost paid out production from Fayette.
- Debt increase is based strictly on deposits from partners, not bank or payables.
KFG Results after 9 months in 2015
- Cash: $2.134M, Total Assets: $3.7M, Tot Debt: $1.07M
- Revenue: $2.27M, Net Income After 9 Months: $493K
- If the price of oil didn’t drop 60% and weather didn’t hamper KFG’s operations (as stated in their last news release), net income would be close to $1 million USD right now. Regardless, this has not stopped KFG’s growth plans. Five to seven wells have been announced for the summer drill campaign and the company can only go forward from here.
Massive insider buying on KFG: https://www.insidertracking.com/comp...FG%20Resources
There's only 50,584,144 common shares with no options or warrants.
Haney, Kevin
Insider's Relationship to Issuer as Filed with Regulator:	3 - 10% Security Holder of Issuer
TransactionDate	Transaction Nature	# or value acquiredor disposed of	Price	AccountBalance
Security Type:	Common Shares (Direct Ownership)
Jul 17/15	10 - Acquisition in the public market	16,000	$0.095	6,000,000
Jul 17/15	10 - Acquisition in the public market	2,000	$0.085	5,964,000
Jul 6/15	10 - Acquisition in the public market	3,000	$0.100	5,959,500
Jun 29/15	10 - Acquisition in the public market	10,000	$0.090	5,929,500
Jul 6/15	10 - Acquisition in the public market	10,000	$0.085	5,956,500
May 27/15	10 - Disposition in the public market	-71,500	$0.100	5,919,500
Apr 23/15	10 - Acquisition in the public market	1,500	$0.110	5,991,000
Apr 22/15	10 - Acquisition in the public market	500	$0.090	5,988,500
Apr 2/15	10 - Acquisition in the public market	1,000	$0.100	5,986,000
Mar 26/15	10 - Acquisition in the public market	5,000	$0.080	5,980,000
Mar 5/15	10 - Acquisition in the public market	2,000	$0.080	5,955,000
Mar 5/15	10 - Acquisition in the public market	13,000	$0.090	5,953,000
Feb 27/15	10 - Acquisition in the public market	5,000	$0.080	5,930,000
Feb 9/15	10 - Acquisition in the public market	5,000	$0.105	5,915,000
Feb 1/15	10 - Acquisition in the public market	23,000	$0.120	5,883,000
Jan 30/15	10 - Acquisition in the public market	9,000	$0.095	5,860,000
Jan 30/15	11 - Acquisition carried out privately	1,000	$0.090	5,851,000
Jan 20/15	10 - Acquisition in the public market	10,000	$0.090	5,840,000
See more at: https://www.insidertracking.com/comp....tetB2xlO.dpuf
KFG Resources Ltd.'s drilling program is on hold because of high water above flood stage in the Mississippi River which affects large areas of land -- sometimes many miles away from the river. This circumstance is unprecedented in the last 75 years. The company's program will commence when conditions permit.
The company's production is stable and cash flow was positive during the first quarter of its fiscal year ending July 31, 2015. The company's Barnum No. 3 well in Adams county, Mississippi, has proved to be non-commercial and is producing 10 barrels of oil per day.
As of this date, the company has three new projects and one development well ready to drill. Two additional projects are being assembled. All projects are in Mississippi.
KFG Year End Results Ending April 30th 2015
Options/Warrants: 0
Insider Holdings: 16%
Before reading the financial results and management discussions below, one must take into consideration that KFG had quite a good year considering the three major setbacks that occurred. Oil production, cash, and management fee's are all up year over year, but the write down of oil assets which every single petroleum company had to do made KFG show a small net loss of less than $100,000. Without the $800,000 write down, KFG would of ended the year with positive net income. Despite this, drilling will move forward next month even at these lower prices, and with several wells to do, odds of production increasing are quite good.
Three Setbacks this year:
1) Price of oil which went from $110 to $40 and this is Louisiana Light Sweet Crude
2) Historic flooding in Mississippi which stopped some production and added extra costs
3) Several wild cat wells were dry which not only increased expenses, it added no value
4) KFG's best well Craig 5 did not start pumping until after the fourth quarter ended
Financial Results Ending April 30th 2015
**My Note: All numbers are in US dollars and therefore should be converted to reflect the proper value in Canadian dollars. For example, KFG's cash position of $1.4 million USD is actually worth $1.85 million Canadian dollars as of August 28th 2015. This is essential to do considering the company is listed on a Canadian exchange.**
Producing Wells - 25 (22 in 2014)
Barrels of oil per day average - 96.02 bopd (71.79bopd in 2014) - 25% increase
Average sell price - $46.41 ($101.75 in 2014) - Down by $55.34 or 54%
*Operating cost per barrel average is $18.85 before G&A costs*
*KFG sells it's oil at LLS(Louisiana Light Sweet) pricing which is similar to Brent*
Cash: $1,401,025 - (2014 $1,205,750)
Property and Equipment: $901,766
Total Assets: $2,818,945 - (2014 $3,017,302)
Accounts Payable: 527,848
Deposits : $3,988
Decommissioning Liability: $233,754
Total Liabilities: $765,590 - (2014 $879,582)
Assets decreased year over year, but so did Liabilities.
Oil and Gas - $2,278,425 - (2014 $2,240,754)
Management Fee's - 466,674 - (2014 $419,014)
Total Sales - $2,745,099 - (2014 $2,659,768)
Total - -$84,365 - (2014 $67,467)
Revenue year over year slightly higher due to production increase by a substantial amount. However, selling oil at $46 average in 2015 compared to $101 average in 2015 made a big difference.
Expenses( 2015 - 2014)
Automotive: $96,914 - 71,902 - Increased by $25,012
Bad Debt - 0 - $2,372 - Decreased by $2,372
Depletion - $807,733 - $408,559 - Increased by $399,174 (Write down)
Dry hole & Abandonment - $118,889 - $168,065 - Decreased by $49,176
Exchange Loss - $772 - $4,802 - Decreased by $4,030
Insurance - $114,937 - $106,896 - Increased by $8,041
Lease Operations - $615,761 - $758,738 Decreased by $142,977
Office & Misc - $296,145 - $275,720 Increased by $20,425
Rent - $19,602 - $18,633 Increased by $969
Salaries & Benefits - $758,711 - $776,614 Decreased by $17,903
If you exclude the write down, remaining expenses went down $162,551 year over year. Unfortunately, every petroleum company must write down assets and take it as an expense/loss.
Management Discussion Highlights
Summary of Quarterly Results
The main difference in the last two quarters ended January 31, 2015 and April 30, 2015 were slumping oil prices in the January 31, 2015 quarter and increased depletion and amortization changes because of reserve depletions resulting from increased production, directly affecting earnings.
Liquidity and Capital Resources
The Company’s main sources of liquidity are internally-generated cash flow from its oil and gas operations. Because KFG’s internally-generated cash flow is presently sufficient to fund its overall operating expenses, the Company will not require additional funding from equity capital markets in order to execute on its business strategy for at least the next twelve months. A decline in the prices of natural gas and oil could materially and adversely impact on KFG’s ability to secure partners in drilling projects, with the result that the Company may be forced to scale back its operational activities.
KFG had cash at April 30, 2015 of $1,401,025. Oil production at Fayette is providing positive cash flow and will continue. Also the Company’s new oil revenues will provide a borrowing base in addition to the Fayette development. As of now, the Company plans to expand as cash flow permits. The Company is already experiencing new production from the Craig #5 well and all wells are back on line. During the period January 2015 – April 2015, the Company experienced bad weather and weak pricing. Two wells were drilled in February 2015, but not put on production until May 2015 because of the weather. Also the Craig #2 well and the MacNeil wells have not lined up with expectations.
The quarter ended April 30, 2015 experienced prices at multi-year lows and wells of production that couldn’t be put back on in a timely manner. All wells are producing now but prices have reduced to the low $40 range from $60 in May, June and July 2015.
Production at Fayette is stable and has started a slow decline. With the Dale lease back on production and new production coming off the Craig and Parker leases, KFG will have adequate internal cash flow to develop existing leases as well as support several new prospects in the coming months. Unless the price of oil collapses, the Company will generate sufficient capital to fund its requirements throughout 2016 internally.
**My Second Note: The directors Stephen Guido and Robert Kadane might not have large share positions, but they do own interests in several current and future wells. They were paid for this over 2015 and therefore it is in their best interest to make sure that every project is successful for KFG. They are paying for these wells at their own risk.**
From financials:
Included in accounts receivable from co-owners is $18,204 (2014 - $nil) due from Geronimo Corporation, a company controlled by G. Stephen Guido, an officer and Director of the Company and $19,562 (2014 - $nil) from Robert Kadane, Director and officer of the Company.
KFG drills 10 ft of McShane oil sand in Mississippi
KFG LOGS NEW FIELD DISCOVERY WELL
KFG Resources Ltd. has logged a new discovery oil well in Franklin county, Mississippi. The company's subsidiary, KFG Petroleum Corp. of Natchez, Miss., drilled the Drouet Poole Estate No. 1 well to a total depth of 6,800 feet and found 10 feet of McShane oil sand from 6,618 feet to 6,628 feet. Production casing has been set for a completion attempt. The company has a 12-per-cent working interest in the well before payout and a 24-per-cent working interest after payout.
In addition, the company is moving in to drill its Second Creek prospect in Adams county, Mississippi. The Stockfelt unit No. 1 will be drilled to a depth of 4,600 feet to test the Third Wilcox formation. KFG has a 15-per-cent working interest in the well, jumping to a 21.5-per-cent working interest at payout. At this writing, it is anticipated that two more wells will be drilled in the program, and those projects will be announced at a later date.
KFG logs, core nine feet of oil sand at Third Wilcox
KFG REOPENS PRODUCTION AT SPRINGFIELD
KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp., has logged and cored nine feet of oil sand from 4,393 feet to 4,402 feet in the Third Wilcox sand. Production casing has been cemented to 4,600 feet. KFG has a 13-per-cent working interest in the well, the Stockfelt unit No. 1, reverting to a 20.25-per-cent working interest at payout. The company will report initial production tests when available.
KFG's previously announced Drouet Pool Estate well in Franklin county, Mississippi, is being completed at present, and a report on initial production should be available next week. Also, KFG has staked location for its Barnum No. 4 well in Adams county, Mississippi and will be moving in a rig to drill the well to 6,800 feet in approximately three weeks.
KFG Resources Ltd Q1 2015 Results(Ending July 31st 2015)
Overall it was a pretty good quarter for KFG despite the circumstances. Oil prices down 50% year over year, historic flooding that caused some wells to shut off for 45-60 of the 90 days(See end of June news release). As well, expenses increased because of new staff and new equipment needed for damaged wells, plus a few other things.
-	Cash increased almost $100k
-	Liabilities went down $75K
-	Company made a profit even with half of the revenue from last year
-	New leases in Texas signed with wells to drill before year end
-	More Mississippi wells to drill
Cash: $1,499,459 (last quarter was $1,401,025)
Property & Equipment: $932,204
Total Liabilities: $696,846 (last quarter was $765,590)
Revenue: $506,423( last year this time was $904,409)
Production: 75bopd (same as last year due to shut wells because of flooding)
Productive wells: 23 compared to 21 in 2014
Net Income: $14,563
The Company drilled two wells in February 2015 but they were not on production until late May and June 2015. The Company has sufficient cash reserves to finance its activities for the remainder of its fiscal year. Two new wells being completed in late September 2015 should add cash flow and help lower the overall cost of production. The Company plans to participate in the drilling of two new shallow wells in north central Texas before year end, marking KFG’s entry into Texas.
Revenue from the sale of oil and gas was $395,052 for three months ended July 31, 2015, compared to $788,143 for the three months ended July 31, 2014. The decrease in revenue is a result of a price collapse in oil from $102.40/bbl to $55.33/bbl.
Management fee revenue for the three months ended July 31, 2015 was $111,371 as compared to $116,266 for the three months ended July 31, 2014. The results are comparable between periods.
Lease operating expenses were $115,515 for the three months ended July 31, 2015 compared to $79,144 for the three months ended July 31, 2014. The increase in lease operating expenses is a result of putting two wells back on production that have been shut in because of the wet weather.
General and administrative expenses for three months ended July 31, 2015 were $278,985 compared to $267,460 for the three months ended July 31, 2014. The main increase in costs is a result of hiring new staff.
The Company’s main sources of liquidity are internally-generated cash flow from its oil and gas operations. Because KFG’s internally-generated cash flow is presently sufficient to fund its overall operating expenses, the Company will not require additional funding from equity capital markets.
KFG had cash at July 31, 2015 of $ 1,499,459. Although oil prices have collapsed, the Company, through the first fiscal quarter ended July 31, 2015, continues to generate positive cash flow. Two recent wells should help continue the trend. The Company will continue to manage its cash resources and will complete its current drilling program. In addition, the Company is increasing its inventory of projects seeking longer term leases.
The Company’s cash position going forward will be able to finance all projects internally for the remainder of its fiscal year ending April 30, 2016. Two new wells should help the Company maintain a positive cash position. At this writing, two additional wells are planned in Mississippi this calendar year and one developmental well, weather permitting in Mississippi, as well as shallow wells in north Texas.
KFG completing Drouet Poole Estate, Stockfelt wells
KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp. (and partners), is completing its Drouet Poole Estate No. 1 well in Franklin county, Miss. Production rates will be reported in the next couple of weeks. The company owns a 12-per-cent working interest in the well which will revert to 24 per cent if the well pays out. In addition, completion of the company's Stockfelt No. 1 well, in Adams county, is under way. The company owns a 13-per-cent working interest in this well, before payout, and a 20.25-per-cent working interest if the well pays out. The company is currently waiting on additional equipment essential in completing the well.
KFG Petroleum Corp. is being qualified to do business in the state of Texas. A joint venture agreement has been signed with a private oil and gas exploration company located in Wichita Falls, Tex., to participate as a non-operating working interest partner in two shallow oil tests in Archer and Wilbarger counties in north Texas. Details will follow when the projects are completely ready to drill. Currently, the best estimate is early to mid-November, 2015.
http://www.forttours.com/pages/hmwichita.asp
Kadane Discovery Well
Marker Title: Kadane Discovery Well
Address: SH 25, S of Electra
City: Electra
Year Marker Erected: 1978
Marker Location: From Electra take SH 25 about 14 miles south. Marker is located on west side of highway.
Marker Text: Oil development in this part of Wichita County began in 1919 from shallow depths in the KMA Field. As the original wells went dry, and a severe national Depression blighted the country in the 1930s, the oil industry sought new production. The Mangold family, owners of land at this site, offered liberal terms for deeper exploration, but at first found no driller willing to take the risk on the scant capital then available. Finally veteran operator George E. Kadane (1881-1945) and sons Edward, Jack, and Mike had the courage to drill in this area of negative geologic readings. On Nov. 11, 1937, they struck oil at a depth of 3800 feet, bringing in Mangold No. 1 as a gusher. The discovery effected an extension of the KMA Field. This spot was labeled "Kadane Corner" on local maps. Other operators rushed in, starting a new Wichita County boom. Along with a rapid rise in population came new housing construction, new industries, new jobs, and an era of financial growth. In 1942 a test well on the Griffin Ranch came in at 4300 feet. Final development of the field resulted in more than 2000 producing wells in an area of 75,000 acres.
NOTE: George Kadane is Robert Kadane's grandfather.
KFG Resources working on Barnum No. 4 well completion
KFG COMPLETING BARNUM #4, ADAMS COUNTY, MISSISSIPPI
KFG Resources Ltd.'s subsidiary, KFG Petroleum, and its partners have logged and cored several oil zones in its Barnum No. 4 well. Production casing is being run to 6,500 feet for a completion attempt. KFG has a 9.19-per-cent working interest in the well, increasing to 21.6 per cent if the project pays out.
Completion operations are proceeding on the company's previously announced Drouet Poole Estate No. 1 and Stockfelt No. 1 wells. In addition, a location has been staked for the Drouet Poole Estate No. 2 well, which is to be drilled within the next 30 days.
KFG Resources completes Drouet Poole Estate No. 1 well
KFG COMPLETES DROUET POOL ESTATE #1 WELL
KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp., and its partners have completed the Drouet Poole Estate No. 1 well, Franklin County, Mississippi, pumping 60 barrels of oil per day and 30 barrels of water a day. The company and partners drilled the No. 2 Poole Estate well as a north offset to the No. 1 and abandoned it last week. KFG owns a 12-per-cent working interest in the well, investing to a 24-per-cent working interest after the No. 1 and the dryhole costs of the No. 2 well are recovered. Future development will depend on how production volume holds up in the No. 1 well.
The Stockfelt No. 1 and the Barnum No. 4 well are in various stages of completion.
In Wilbarger County, Texas, the company has participated in its first exploratory well in the area with a private oil company acting as operator. The company has a 14-per-cent working interest in a 400-acre lease on the Waggoner Ranch and participated in a 2000 Dyson sand test completed as a dry hole. Further evaluation awaits remapping of the area. A second shallow test is scheduled on its Griffin lease several miles away before year's end. Going forward, the company's interest will vary depending on the project.
Not a bad update overall. Drouet 2 as a dry well isn't a big loss as they could technically convert it into a salt water well and not only bring up production on Drouet 1, but lower costs on production as well. Stockfelt and Barnum has good oil showings so they should be producers. Texas was the only real disappointment, but the well cost less than $200,000 to do and kfg has 14%, no big loss for a test well. KFG is still producing slightly over 100bopd daily with an operating cost of less than $20 a barrel and getting paid on all 30 producing wells for monthly maintenance as a second revenue stream.
KFG unit places Barnum No. 4 on production
KFG PUTS BARNUM #4 ON PRODUCTION
KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp., and partners have put the Barnum No. 4 well in Adams county, Mississippi, on production. The well was perforated in the Armstrong sand of the Wilcox formation from 6,784 to 6,786 feet. On Nov. 30 the well started pumping at 9 a.m. and by noon oil was at the surface. By 4 p.m. the well was producing at a 60-barrel-of-oil-per-day rate and by 10 p.m. at a 120 bopd rate. The pumping unit was slowed down at 2 a.m. to an 80 bopd rate and will be produced at that rate until it stabilizes. KFG has a 9.19-per-cent working interest in the well increasing to a 21.6-per-cent working interest if the project pays out. The No. 4 well sets up another location that will probably be drilled in the spring of 2016.
The Drouet Poole Estate No. 1 well continues to produce 60 barrels of oil and 30 barrels of water per day. Completion operations are under way on the Stockfelt No. 1 well.
The Mississippi River has risen unexpectedly delaying the company's 7200 test at N. Fairfview in Adams county, Mississippi. At this writing, KFG has three development wells to be drilled in the spring and summer of 2016.
KFG Resources LTD. Q2 Results (Ending October 31, 2015)
Before reading, as a shareholder you should understand the following:
- All numbers are in US Dollars and therefore the balance sheet and assets do not reflect the true value that KFG is actually worth per share. Being a TSXV listed company, you must convert the numbers to Canadian dollars in order to get a true value
- The company is in such a strong financial position that it will be able to weather this down turn in oil prices better than most junior o&g companies in the lower end market cap range.
- Barnum 4, Drouet and Stockfelt production & revenue, were not added to this quarter, only the costs.
Insider/Institutional Holdings: 17%
Financials(In US Dollars)
Cash: $1,818,812( $2.5 million CDN or $0.05c a share)
Accounts Payable: $1,007,729
It’s good to see that KFG has more than enough cash to cover all liabilities and continue drilling with the excess capital. Revenue was down again this quarter because of oil prices and costs increased substantially due to the fact that several productive wells were charged in the quarter, but cash flow will not be added until Q3. Leasing operations and office expenses increased by over $200,000 which caused the loss in the quarter, otherwise KFG would have been flat for earnings.
Oil and gas revenue: $295,631 (production high but average barrel revenue was lower)
Management fee’s: $185,494(This increased by almost $100,000 which is a great secondary revenue)
Total Revenue: $481,125
Total Expenses: $688,262
During the six months ended October 31, 2015 and 2014, oil and gas was the Company’s main source of revenue, and to a lesser extent management fees. At present rates of production and oil prices, management believes the Company has sufficient cash reserves to finance its activities for the remainder of the fiscal year.
The Company drilled and completed two wells in early 2015, which were not on production until late May and June 2015. Those wells, together with two new wells completed in late September 2015, should add to cash flow and lower overall production cost. The Company is participating in the drilling of new shallow wells in north central Texas, marking KFG’s entry into Texas. The Company has a 14% working interest in this venture. The first well drilled was completed as a dry hole. A second well will be drilled in the first quarter of 2016, as a 2,000’ Dyson Sand test in Archer County, Texas. Depending on the results of this well, the Company may elect to participate in the drilling of additional wells in this venture
The quarter ended October 31, 2014 was the last quarter of prices above $100/bbl and reflected the new production. During the quarter ended January 31, 2015, through to the quarter ended April 30, 2015, further price declines and increased depreciation and amortization occurred as a result of a lower reserve bases. Two wells were drilled in February 2015 but were not put on production until late May 2015. The quarter ended July 31, 2015, saw some stabilization of costs. The current quarter has seen two new wells drilled. The quarter ended October 31, 2015 saw two new wells drilled and one dry hole. New production was after the quarter ended. The Barnum #4 and the Drouet Poole Estate wells are adding to production at present but a price of less than $40/bbl is hurting cashflow.
KFG had cash at October 31, 2015 of $1,818,812. Although oil prices have collapsed, the Company, through the six months ended October 31, 2015, continues to generate positive cash flow. Two recent wells should help continue the trend. The Company will continue to manage its cash resources and will complete its current drilling program. In addition, the Company is increasing its inventory of projects seeking longer term leases. The Drouet Poole Estate #1 well and the Barnum #4 well are adding to production but is somewhat offset by crude oil prices at $35/bbl.
The total number of shares outstanding as at October 31, 2015 and December 28, 2015, is 50,584,144. As of October 31, 2015 and December 28, 2015, there were no stock options or warrants outstanding.
The Company’s cash position going forward will be able to finance all projects internally for the remainder of its fiscal year ending April 30, 2016. The Company drilled and completed two wells in early 2015, which were not on production until late May and June 2015. Those wells, together with two new wells completed in late September 2015, should add to cash flow and lower overall production cost. The Company is participating in the drilling of new shallow wells in north central Texas, marking KFG’s entry into Texas. The Company has a 14% working interest in this venture. The first well drilled was completed as a dry hole. A second well will be drilled in the first quarter of 2016, as a 2,000’ Dyson Sand test in Archer County, Texas. Depending on the results of this well, the Company may elect to participate in the drilling of additional wells in this venture.
KFG Resources appoints Haney, Grassi as directors
KFG RESOURCES LTD. APPOINTS HANEY, GRASSI TO THE BOARD OF DIRECTORS
KFG Resources Ltd. has appointed Kevin Haney and Giacomo Grassi to its board of directors. The following are brief biographies of KFG's new directors.
Mr. Haney has over 20 years of experience in the oil industry with experience as a director for Bird River Resources, a public oil exploration company. Today, Mr. Haney owns a private company with an oil and investment division. He currently holds 6,055,000 common shares, or approximately 12 per cent of the outstanding shares of KFG Resources.
Mr. Grassi has over a decade of combined experience in retail, wholesale and marketing in multiple industries, along with mineral exploration in Canada. He holds a BA degree from the University of Calgary and a graduate gemologist diploma for the Gemological Institute of America. Mr. Grassi currently holds 1,299,000 common shares, or approximately 2.6 per cent of the outstanding shares of KFG Resources.
Robert Kadane, president of the company, would like to thank former directors Keith Pople and Michael Raftery for their 22 years of service on behalf of KFG Resources.
The company website has been updated and there is a new presentation:
http://kfgresources.com/
http://kfgresources.com/wp-content/u...ober-11th-.pdf
KFG unit seeks financing for drilling in Mississippi
KFG Resources Ltd. subsidiary KFG Petroleum Corp., of Natchez, Miss., is in the process of attempting to finance its drilling and development program. The current environment is extremely difficult, and it may be the first quarter of 2017 before sufficient drilling funds have been raised to protect the company's cash position.
The company has one, possibility two, development wells to drill in Mississippi, but currently, partners and mineral interest owners do not want to drill and sell the oil at current prices, but will be agreeable in the 60-dollar-per-barrel range. The company has assembled two wildcat acreage blocks in Mississippi, but to date, the company has not been able to raise enough capital to justify the dry hole risk involved. The fact that most operators only have year-end budgets and can not project reliable cash flow in the near future, because of fluctuating oil prices, makes planning difficult, but KFG is pursuing all leads.
KFG would like to acknowledge its new director, Giacomo Grassi, for the work he has done on the company's new website.
Top oil jurisdictions in the world right now - http://www.oilandgas360.com/oklahoma...as-investment/
2017 company presentation - http://kfgresources.com/investors/
KFG Resources Ltd January 2018 Company Presentation - http://kfgresources.com/wp-content/u...esentation.pdf
KFG May 2018 Company Presentation: http://kfgresources.com/wp-content/u...esentation.pdf
KFG Resources receives permit for Barnum No. 5 well
KFG RESOURCES ACQUIRES PERMIT TO DRILL BARNUM #5 WELL
KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp. of Natchez, Miss., has permitted the Barnum No. 5 well in Adams county, Miss. It will be a 6,500-foot test of several Wilcox sands that produce in the immediate area. As of July 1, 2018, KFG's Barnum lease has paid out and the company's working interest rose from 9-per-cent working interest to 22.5-per-cent working interest and from 6.89-per-cent net revenue interest to 16.875-per-cent net revenue interest.
KFG's Craig lease will pay out shortly and a news release will be put out when that occurs. Additional projects are now under review with the improved pricing environment.
KFG Resources Ltd. September 2018 Company Presentation:
http://kfgresources.com/wp-content/u...esentation.pdf
News: KFG Operations Update (Barnum Drill, Craig Payout, Share Buyback, Texas Project)
https://www.newswire.ca/news-release...692948991.html
NATCHEZ, Miss., Sept. 11, 2018 /CNW/ -- As previously reported, the Company's Barnum lease, Adams County, MS, paid out in July 2018 and KFG's working interest increased from 9% to 22.5%. The Barnum #5 location has been staked and permitted. Currently, the Company is waiting on a drilling rig which is expected to move into the location as soon as weather permits.
Additionally, the Company's Craig #3 should payout by the end of September, substantially increasing KFG's working interest.
Also, KFG has entered into a farmout agreement with Tracer Operating Company, Graham, Texas to recomplete 3 shallow gas & oil wells with an option to recomplete 3 additional wells. These are shallow recompletions (3600'-4500') in Palo Pinto and Stephens County, Texas. Capital is now being raised for this venture.
In addition, the Company is considering a share buy back proposal. Specifics will be presented to the board at the Board Meeting on September 28, and voted on at that time.
The Company's common shares are listed on the TSX, Venture Exchange, Vancouver, B.C. Trading symbol "KFG".
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
SOURCE KFG Resources Ltd.
For further information: Robert A. Kadane, President, (940) 723-7052, http://www.kfgresources.com
NATCHEZ, Miss., Sept. 20, 2018 /CNW/ -- Robert A. Kadane, President of KFG Resources Ltd., reported today that the Company's subsidiary, KFG Petroleum Corp., Natchez, MS, is moving in and rigging up to drill the Barnum #5 well. It is a 6400' Wilcox test. The Company's working interest is 22.5% (16.875% NRI).
In addition, KFG's Craig #2 paid out effective September 1, 2018. KFG's working interest increased from 11% to 22.5%. Also, to clarify an item in the news release dated September 10, 2018, the capital being raised for the Company's Graham, Texas venture is being raised from oil industry partners, not a private placement stock offering.
View original content: http://www.newswire.ca/en/releases/a.../20/c6488.html
KFG earns $67K USD profit in Q1 2018. Results out on Sedar: https://sedar.com/DisplayCompanyDocu...uerNo=00006016
KFG Resources earns $67,334 in quarter ended July 31
KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp., recorded revenues for its quarter ended July 31, 2018, of $397,520 versus $323,300 for its corresponding quarter of 2017. Net income for the July 31, 2018, quarter was $67,334 vs. $17,801 for the July 31, 2017, quarter. The company's current ratio was in excess of two to one for the quarter ended July 31, 2018.
The share buyback proposal was passed by the KFG's board meeting at its annual stockholder meeting. When all paperwork has been completed, details will be announced. Also, capital is being raised from oil industry partners for the project in Graham, Tex., to re-enter and recomplete three wells with an option to recomplete two additional wells. The No. 5 Barnum well in Adams county, Mississippi, was completed as a dry hole to 6,400 feet. KFG had a 22.5-per-cent working interest in the well.
In addition, the payout of the Barnum and Craig leases should add additional free cash flow of approximately $20,000/quarter to the company's offers.
KFG Resources Ltd. October 2018 Company Presentation: http://kfgresources.com/wp-content/u...esentation.pdf
https://ceo.ca/api/sedi?insider=&sym...unt=&undefined[company_symbol]=KFG
Recent filings
Filing date: 2018-10-25
Transaction: 2018-10-25	$KFG
KFG Resources Ltd	Haney, Kevin
3 - 10% Security Holder of Issuer, 4 - Director of Issuer
Common Shares
10 - Acquisition or disposition in the public market	$660.00
+11,000 vol
$0.06 each	6,996,000
+4,000 vol
$0.065 each	6,985,000
Older filings
10 - Acquisition or disposition in the public market	$71.50
10 - Acquisition or disposition in the public market	$3,285
KFG Resources Ltd. January 2019 Company Presentation:
KFG Resources to buy back up to 2.5 million shares
An anonymous director reports
KFG RESOURCES ANNOUNCES INTENTION TO COMMENCE NORMAL COURSE ISSUER BID
The TSX Venture Exchange has accepted KFG Resources Ltd.'s notice of intention to make a normal course issuer bid for common shares in the capital of the company through the facilities of the TSX-V. The Company intends to purchase, from time to time as it considers advisable over the 12-month period of the NCIB program, an aggregate of 2,500,000 Common Shares, representing approximately 5% of the Company's issued and outstanding Common Shares and approximately 6.15% of the Company's "public float" (as such term is defined under the TSX-V Corporate Finance Manual).
The Company may commence the NCIB on January 15, 2019 and the NCIB will terminate on the earlier of the Company purchasing a total of 2,500,000 Common Shares, the Company providing a notice of termination, or the date that is 12 months following the commencement date. All purchases will be made through the facilities of the TSX-V at market prices and otherwise in accordance with the rules and policies of the TSX-V. All Common Shares acquired by the Company under the NCIB will be subsequently cancelled. The Company has appointed PI Financial Corp. to conduct the NCIB on its behalf.
The board of directors of the Company believes that, from time to time, the market price of the Common Shares may not adequately reflect the Company's underlying value and future prospects and that, at such times, the purchase of the Common Shares represents an appropriate use of the Company's financial resources and would be in the best interests of the Company's shareholders.
The Company's Common Shares are listed on the TSX-V, Vancouver, B.C., trading symbol "KFG".
We seek Safe Harbor.
KFG Resources purchases interest in West Hazel assets
KFG RESOURCES LTD. PURCHASES PRODUCTION IN SASKATCHEWAN
KFG Resources Ltd. has completed a production purchase in western Saskatchewan. A financial partnership was formed with Hillcrest Petroleum whereby the company purchased 15 per cent of Hillcrest's position in its West Hazel assets, which amounts to 75 per cent of the total interest available. Total consideration paid by the company to Hillcrest was $150,000 (approximately $113,000 (U.S.)). Four shut-in wells are being re-entered and returned to production after being shut in for four years. It will take a few weeks to ascertain how much production will be recovered (what the daily rate from all four wells will be). In addition, other potential on the lease is being evaluated (consisting of 220 acres) and KFG Resources has the right to participate in any further development of the assets at a level equal to its current percentage of Hillcrest's ownership.
October 2018 presentation from Hillcrest explaining the potential of West Hazel: https://www.youtube.com/watch?v=6NH-PzrlIX4
KFG Insider Buying:
KFG Resources Ltd	Grassi, Giacomo
4 - Director of Issuer
10 - Acquisition or disposition in the public market	$11,055
+201,000 vol
KFG Resources Ltd	KFG Resources Ltd.
1 - Issuer
38 - Redemption, retraction, cancellation, repurchase	$840.00
$0.04 each	21,000
00 - Opening Balance-Initial SEDI Report
KFG Resources Ltd	Kadane, Robert Andrews
4 - Director of Issuer, 5 - Senior Officer of Issuer
11 - Acquisition or disposition carried out privately	$1,621.312
$0.032 each	896,668
Hillcrest produces 150 bpd of oil at West Hazel
Mr. Donald Currie reports
HILLCREST OIL PRODUCTION CLIMBS
Hillcrest Petroleum Ltd.'s upgraded West Hazel production facility is in operation, as previously announced, and production started from two wells on Jan. 13, 2019, and Jan. 15, 2019, respectively. Initial fluid production rates from both wells were as expected. Production from a third well was brought on-line in early March when weather conditions softened after an extreme record-breaking cold snap.
Production over the last five days from the three wells has averaged 150 barrels per day which meets the lower production estimates the company published in its previous releases, although those estimates considered production from all four wells. Hillcrest is encouraged by the early results, which are meeting or exceeding previous estimates. The company is focused on efforts to maximize the production from the current wells and is further upgrading the potential of the injector well, which in turn, if successful, could result in higher production numbers from the current three wells. A normalized sustained production rate is expected to take another three weeks to four weeks and will be released when achieved.
Hillcrest will move to work on and start production from the fourth well once current efforts have been completed, results reviewed and a rig is available.
As previously announced, under the terms of its joint venture agreement on the West Hazel property, the company will provide 100 per cent of reactivation costs to return the field to production to earn a 75-per-cent working interest, reverting to 50 per cent after recovery of reactivation costs.
KFG April 2019 Company Presentation: http://kfgresources.com/wp-content/u...esentation.pdf
KFG Resources talks oil production in Jefferson county
KFG RESOURCES LTD. OPERATIONS UPDATE
KFG Resources Ltd. has noted a rework in Jefferson county, Mississippi. The Spring Hill No. 1 well was put back on production for 10 to 15 barrels of oil per day. KFG owns a 67.5-per-cent net revenue interest (NRI). In addition, the No. 4 Barnum well (KFG owns a 16.9-per-cent NRI) is scheduled to be reperforated in July in an attempt to increase production.
In Saskatchwan, Canada, at West Hazel, production on the fourth well has been restored. KFG has an 11.25-per-cent working interest in the acreage. The wells produce heavy oil and can take two to three months for daily steady production numbers to occur. Approximately 4,800 to 5,000 barrels of fluid a day is being produced with oil representing 1.5 per cent to 2 per cent, or 80 to 100 barrels of oil per day. As production stabilizes the oil cut percentage should increase resulting in more saleable oil. Current production is covering all operating and asset costs.
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