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Black Star Oil Company


Throckmorton County, Texas



November 18, 2000



The Hickey Prospect is to located in the far northeast corner of Throckmorton County, Texas, approximately three miles north of the small farming village of Elbert. The prospect is located along a significant regional geologic feature known as the Bend Arch, which separates the Eastern Shelf of the Midland Basin from the Fort Worth Basin to the east. Many oil and gas fields have been discovered and produced for decades along this deep-seated feature. One of the more prolific producing formations in this trend to date has been the Mississippian Chappell Reef horizon. Multitudes of these reef fields occupy the trend from Eastland County, Texas, northward toward the Red River. These reefs are variously referred to as pinnacles, lime mud mounds and other terms, and are found at moderate depths. Frequently, positive draping effects over these rather steep-sided reefs cause structural trapping of hydrocarbons in more shallow horizons, notably the Caddo Formation (sometimes a reef-built limestone, other times a sandstone body known as the "McLester", or both), the Strawn Sandstone formations and very occasionally, the Palo Pinto and Gunsight intervals. Conglomerate production between the Caddo and Mississippian horizons is more significant to the south of our prospect area.

Nearby, there exists historically prolific oil production from the Strawn Sand Series, some 1400 feet above the Mississippian formation, where some individual fields have produced from 500,000 to more than 1,000,000 barrels of oil. The closest of these fields is the Elbert (Strawn) and Elbert (Strawn, Lower), located approximately two miles southwest of our prospect, which together have produced about 600,000 barrels of oil. Strawn Sand development is present across our acreage, but oil-bearing sand has yet to be established. We plan to inspect drilling samples closely for any shows of oil from what appears to be a structurally advantaged position draped over a Mississippian Reef, possibly having a situation where we have more than one pay zone in a single well. Some wells in the immediate area exhibit such a phenomenon.

Mississippian Reef fields in this area range in excess of 500,000 barrels of oil for multi-well fields, with 40,000 to 140,000 barrels for one or two well fields being more common. Although the Railroad Commission of Texas sets a new field allowable of 100 Barrels of Oil Per Day (100 BOPD) for Mississippian Reef Discoveries at this depth (generally 4700 to 4900 feet below the surface), more conservative production rates are enforced by prudent operators to avoid oil waste and early salt water encroachment from below the oil.

For an overview of the regional productive character with some of the cumulative production totals, please see the Regional Production Map and the Area Map for the location of many of the wells and fields in the prospect area.


Now that we have established the character of production and the number of the more prospective zones in this area, we begin our discussion of the particular merits of the Hickey Prospect.

The prospect is defined by subsurface (well information) and excellent quality seismic data. Initial seismic reconnaissance, shot at different times throughout the last few decades, have indicated the possibility of Mississippian Reefs in the area. With the advent of more sophisticated seismic techniques in recent years, higher resolution of these reefs has become possible. It appears that grid lines were shot first, with later lines shot later through the more prospective areas, on indicated reef - type anomalies.

Proposed Location #1

Our initial proposed drilling activity is located on such newer data, vibroseis line 50 and near line 82. Seismic Line MM2 was shot by Black Star Oil Company across the feature in an east westerly fashion which defines the southern extent of the anomaly. The vibroseis data was so successful that a previous operator who was very active in the area some 15 years ago, I C Gas Amcana, staked a location near our initial proposed location. Their location was never drilled. . Inspection of Lines 50 and 82 and MM2 would appear to indicate that our #1 Hickey may penetrate a Mississippian Reef at a favorable structural position.

Black Star Oil Company has drilled three productive Mississippian Reef wells on or near the same type data. The quality and magnitude of the indicated Mississippian Reef beneath our proposed location is evident by the correlative appearance of a proven productive Mississippian Reef on the same survey, to the south of our location on a separate reef. Please see the Structure Map on the Mississippian Reef included with this report for the relative locations of these seismic lines, the nearby wells, and our interpretation of the data.

Proposed Location #2

The Mississippian Reef to the south of the proposed location was discovered in November, 1984, on some of the same vibroseis data series mentioned above. This discovery well for the "Double H (Miss)" Field, the I. C. Gas Amcana #1 Hickey, had reported initial production of 47 BOPD flowing through a 6/64" choke, from "open hole" depths from 4708' to 4735' below the surface. Subsea depth for the top of the Mississippian in the Hickey well is -3568'. The well, although "pulled" rather hard in its early productive life, went on to eventually produce 42,507 barrels of oil before water encroachment, odd treatment procedures and mechanical difficulties may have forced its plugging and abandonment. Crossing seismic information apparently indicates that this well was not drilled on the highest spot, or "crest", of the Mississippian Reef. A location some 600 feet away appears to be more centrally situated upon the reef crest and at a higher structural position.

Regional and Local Productive Trends

The Hickey Prospect acreage is located "on trend" with several other Mississippian Reefs which are shown on the Regional Production Map. Three of these were discovered by Black Star Oil Company over the past few years. To the southwest by less than one mile is the Black Star Oil Company No.1 Manuel, which was the 1991 re-entry of an older "dry hole", drilled on the same type of vibroseis seismic data, with a successful completion in the top of the Mississippian Reef formation. This well was designated as the New Field Discovery for the Blackstar (Miss) Field. Flowing 32 to 33 BOPD through a 3/64" choke at 650 psi flowing tubing pressure for a long time before it began to make formation water, it has produced over 32,000 Barrels of Oil.

To the north of the Discovery well by about 2000 feet is the Black Star Oil Company No. 1 Manuel - McDaniel oil well drilled and completed in 1993, classified within the Blackstar (Miss) Field. This well has produced about 30,000 barrels of oil. The Black Star Oil Company No. 1 Minnie Manuel well was drilled in 1996 between the Manuel and Manuel McDaniel wells, upon a separate Mississippian pinnacle (verified by seismic and dipmeter data), with similar vibroseis data character to that of both the Black Star Oil Company No. 1 Manuel discovery well, and the No. 1 Manuel - McDaniel well. From Line M-1 shot by Black Star Oil Company using dynamite as the energy source, Black Star was able to find a location just off the vibroseis data very near the highest structure. The well has produced over 12,000 barrels of oil. This well never needed acidizing and came in naturally from rather large "vugs"(large holes) in the top of the Reef.

Further to the southwest approximately one and one-quarter mile is the Ashtola No.1 Keeter Ranches 2109, classified in the Elbert, North (Miss) Field, which has produced about 142,000 barrels of oil from the Mississippian Reef since its completion in 1987. This well is somewhat lower structurally to the Black Star Oil Company No. 1 Manuel, No.1 Manuel - McDaniel and the No. 1 Minnie Manuel. The location of the above mentioned wells and that of several others in the area surrounding our prospect acreage are displayed on the Regional Production Map (Scale of 1" = 4000') and the Area Map (Scale of 1" = 1000') which accompany this report

Inspection of the Regional Production Map reveals the location of the best Mississippian Field, in terms of total production to date, in the immediate vicinity. Just across the Throckmorton - Young County line, approximately two miles to the southeast of our prospect, is the Padgitt, West (Miss) Field that has produced over 500,000 Barrels of Oil from a few wells. The arrangement of Mississippian Reefs in closely related clusters seems to resemble the trend across our prospect area, from the No.1 Manuel, through the No.1 Minnie Manuel, the No.1 Manuel McDaniel, and our proposed location, as well as Reef wells to the north, drilled by Martin, and to the south, drilled by I C Gas Amcana.

As discussed above, various members of the Caddo Limestone are productive in the area. This horizon exists at a depth between the Mississippian and Strawn levels. A well which is discussed above, and noteworthy on the Area Map accompanying this report, is the Ashtola No. 1 Keeter Ranches #2109. This well is located within the boundaries of the older Elbert (Strawn) and Elbert (Lower Strawn) Fields, mentioned above and is currently producing from the Mississippian Reef with a cumulative production of 142,000 Barrels of Oil. Reportedly to have been perforated is a Caddo zone which flowed oil on drill stem test during the drilling of the well. This well, therefore, is a good example of how two or more productive horizons might "stack up" in a single well due to draping over a Mississippian Reef.


Based upon the interpretations of the data summarized above, the following recommendations are as follows:

It is proposed that the #1 Hickey test well be drilled at a location that is 330 feet from the north line and 600 feet from the east line (near the high points of Lines 50, 69, 82 and MM2) in the northern part of the W. Horrits Survey, Abstract No. 215, Throckmorton County, Texas.

The #2 Hickey well is proposed at a location approximately 650 feet southeast of the old IC Gas Amcana #1 Hickey well, near the intersection of Lines 30 and M-1, in the same survey as stated above.

Both wells should be drilled to test all known prospective horizons in the area including the Strawn Sand Series, the Caddo Formations, the Conglomerate interval and the Mississippian Chappell Reef. Projected total depth is estimated to be approximately 4850 feet below the surface of the earth.

Analyses of the well will be carried out based upon drill cuttings, drilling rate, dissolved gas and oil in the drilling fluids and a full suite of electric and geophysical logs. A dipmeter will also be run to determine our structural position on the various formations, particularly the Mississippian Reef, and also to determine the feasibility of any future drilling.

In the event it appears either or both test wells are productive in the Mississippian, casing will be run and cemented with the least amount of cement necessary to insure a good bond. Additional cement may be carried up across more shallow horizons if deemed advantageous. Perforations in the Mississippian, if completion is attempted, will most likely be in the very top of the zone, with the probable addition of about 250 gallons of 15% MCA (acid) to clean up the perforations. The new wells would then be tested for production, and if successful, placed on line.

Any subsequent well or wells would most likely follow the procedures outlined above, depending upon the prospective horizon(s) involved.

This report and resulting proposal is based upon a review and interpretation of documents, reports, well logs, production reports, seismic data, and other related information obtained from sources deemed reliable. This report is limited to matters reflected in the items examined and does not cover questions which may arise in connection with erroneous documents, reports, well logs, seismic data, or other information examined. In addition, the reader agrees that the information contained herein, along with all accompanying data, maps and figures, will be held in confidence, and not divulged, shown, or transmitted to any third party without the written permission of the undersigned.




Gary D. Carter, President

Petroleum Geologist