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Vesta Capital Corporation                    TSX-V VES              (United Hunter Oil and Gas)May 2010 Huasna Presentatio...
DISCLAIMER The particulars relating to the Huasna field contained herein were obtained from sources which we believe are r...
Mission StatementThe goals of Vesta Capital Corp.1)  > 0.5 Billion bbls OOIP at Huasna2)  > 1200 bopd production capabilit...
CORPORATE HIGHLIGHTS   Past producing asset in California in the Huasna proven oil field (65% working    interest) with l...
Management & Board   Mr. Bradley Griffiths- Chairman of the Board and Director   Mr. Griffiths received his C.A. in 1982...
Management & Board   Mr. Smith – Chief Financial Officer   Mr. Smith has 34 years of financial management, accounting an...
HUASNA, CALIFORNIAHUASNA FIELD LOCATION IN CALIFORNIA, UNITED STATES Huasna Field is located in southern California near t...
Huasna Field California: Potential OOIP                                                                 Total OOIP (MMbbls...
HUASNA FIELD:Tm Structure - Zoom              CLOSURE SIZE POTENTIAL                                                      ...
HOW TO BUILD UP >0.5 BILLION BBLS OOIP at HuasnaFracture Porosity and Matrix Porosity                    Fracture Porosity...
Huasna Field: Net Production Forecast           5,000           4,500                               Current EIR Limit     ...
HUASNA HISTORY: PROVEN PRODUCTION      Cold production: The discovery well drilled in 1939 to test a surface anticline co...
HUASNA FIELD: FUTURE STRATEGY   Exploit with hot water injection;      three well Pilot Project will initiate the Huasna...
HUASNA FIELD: FIRST THREE WELLS                    Potential Pilot Project Size and Location                              ...
HUASNA FIELD: CROSS SECTION                                                                                               ...
HUASNA FIELD: PILOT PROJECT   Drilling Permits issued – Nov, 2010   First well drilled – Jan, 2011                     P...
PERMIT STATUS   EIR finished and submitted – July 22, 2009        Project Application and Supplement, Engineering Report...
HUASNA FIELD: ESTIMATED COMPANY NET VALUE            Net Value based on Discounted Free Cash Flows*               Annual D...
HUASNA FIELD PROJECT:CASH FLOW SCENARIO ANALYSIS PV of Free Cash Flows (Sensitivity Analysis): Figures in Million USD*   D...
Additional Opportunities-Bypass Pay Zones   In Canada pursue with new technology abandoned or suspended oil fields that h...
Transaction Structure  Vesta   Capital Corp. (Capital Pool Company – (VES – TSX.V))  Qualifying Transaction is completed ...
Use of ProceedsFirst Production                                                                                          C...
Investment SummaryExperienced management team with 30 years of experience   Past producing oil field asset in California ...
CONTACT INFORMATION Vesta Capital Corporation   Contacts                             Dr. Arthur Halleran CEO – 403-667-494...
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Corporate Overview United Hunter Oil and Gas

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United Hunter Oil and Gas TSX-V:UHO
May 2010 Huasna Presentation

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Transcript of "Corporate Overview United Hunter Oil and Gas"

  1. 1. Vesta Capital Corporation TSX-V VES (United Hunter Oil and Gas)May 2010 Huasna Presentation VESTA CAPITAL CORP. COPYRIGHT 2010 1
  2. 2. DISCLAIMER The particulars relating to the Huasna field contained herein were obtained from sources which we believe are reliable but are not guaranteed by us and may be incomplete. The opinions expressed are based upon our analysis and interpretation, and are not to be construed as solicitation or an offer to buy or sell the securities mentioned herein. This presentation contains confidential information and by viewing this presentation the viewer agrees that all the information contained herein will be used by the reader solely to determine his/her/its interest in Vesta Capital Corp. (“Vesta”, “or the company”) and that such information shall be retained exclusively for the benefit of Vesta. The viewer agrees that he/she/it will not, without the express consent of Vesta, make use of, disseminate or in any other way disclose any of the confidential information to any person, firm or business, except to the extend necessary for negotiations, discussions, and consultations with personnel or authorized representatives of the reader for the purpose of determining such interests in Vesta. No securities commission or other similar regulatory organization has reviewed or passed on the merits of this presentation and any representation of the contrary is an offense. This presentation is not, and under no circumstances is to be interpreted as a prospectus, public information, solicitation or advertisement for the sale or trade of securities. The information contained herein in current as of September 22, 2009. VESTA CAPITAL CORP. COPYRIGHT 2010 2
  3. 3. Mission StatementThe goals of Vesta Capital Corp.1) > 0.5 Billion bbls OOIP at Huasna2) > 1200 bopd production capabilities at Huasna3) Additional modest growth properties in Canada and California4) Pursue John Master’s larger play concepts in the USA. 3 VESTA CAPITAL CORP. COPYRIGHT 2010
  4. 4. CORPORATE HIGHLIGHTS Past producing asset in California in the Huasna proven oil field (65% working interest) with low risk, development opportunity with a short time to production (by Q4 2010) Huasna has significant upside potential beyond the resource defined in the current conservative 51-101 report Additional low risk, by-pass pay opportunities in Canada and California to be pursued concurrently Experienced management team with 30 years of financial and operational experience in companies like Canaccord Capital, Griffiths McBurney, Canadian Hunter, Rally Energy and Canacol. VESTA CAPITAL CORP. COPYRIGHT 2010 4
  5. 5. Management & Board Mr. Bradley Griffiths- Chairman of the Board and Director Mr. Griffiths received his C.A. in 1982 and was the head of the Mergers and Acquisitions group of Canadian Imperial Bank of Commerce in 1984 and Vice-President in 1989. Mr. Griffiths was a director and Vice-President of Gordon Capital Corp. and then in 1995 founded and served as Chairman and CEO of the brokerage firm Griffiths, McBurney which rose to become the sixth largest trader on the Toronto Stock Exchange. Griffiths, McBurney completed a $650,000,000 (CDN) offshore, "bought deal" financing as lead underwriter for Sherritt International. While Mr. Griffiths contracted for two years as Co-Chairman and Head of Capital Markets of Canaccord Capital the staff was increase five-fold and a record number of transactions were completed resulting in substantial increase in revenues. Mr. Griffiths and 7 of the 8 members of the Canaccord Toronto corporate finance team purchased a major interest in Standard Securities. Mr Griffiths joined the firm of McFarlane Gordon in 2003 as Managing Director of Capital Markets. In 1999 Mr. Griffiths was recognized as one of the top 20 most influential financiers in Canada and for completing more transactions than any member of the Independent Dealer community. In the last 22 years Mr. Griffiths has completed $20 billion (CDN) in financings and played advisory and financing roles for clients both nationally and internationally. Mr. Griffiths was awarded the Yves Landry Foundation award as Person of the Year in 2002. Dr. Arthur Halleran- Chief Executive Officer and Director Dr. Halleran obtained a Ph.D. Geology & Geophysics from the University of Calgary and has 29 years of domestic and international experience in petroleum exploration and development with extensive exposure to complex carbonate and clastic environments and new basin analysis. In addition, Dr. Halleran has extensive experience in EOR projects. Dr. Halleran was a consulting geologist for Rally Energy Corp. and initiated the companies drilling program which discovered the prolific producing fractured reservoir trend and provided scientific data for EOR steam recovery. Dr. Halleran was part owner and Vice President Exploration for Canacol Energy Ltd., a company with interests in Colombia , Guyana and Brazil During Dr. Halleran’s tenure as VP, Canacol Energy acquired producing assets in Colombia and Brazil and participated in the largest oil discovery in Colombia over the last 10 years. VESTA CAPITAL CORP. COPYRIGHT 2010 5
  6. 6. Management & Board Mr. Smith – Chief Financial Officer Mr. Smith has 34 years of financial management, accounting and business experience. During his varied career, Mr. Smith has acted as Controller, Treasurer, Senior Vice President and Information Technology advisor for both Canadian and international companies. Over the past ten years Mr. Smith has worked as senior financial analyst for RBC Capital Markets and Bell Mobility, controller of Xstrata Copper and MS Access risk analyst for Enbridge Consumers Gas. Mr. Smith has been financial controller of more then 10 public companies. Mr. Smith is a business administration and computer science graduate of Ryerson Polytechnic Institute and received his Certified Management Accountant (CMA) designation in 1989. Mr. Peter A. Rudakas – Vice President of Exploration and Development Mr. Rudakas earned his degree in 1979 M.A. Geography, University of Windsor and Specialized in erosional processes on various rock types, he also earned his B.Sc. Geology, at the University of Windsor. Progressive experience in hydrocarbon play development and management / supervisory functions in exploration. President of a public and private junior oil and gas company. Vice President Exploration, Exploration Manager, Supervisor, Coordinator of mainland Canada operations. Prior to joining United Hunter Mr. Rudakas has been consultant and Geologist with Devon/Northstar, Mogul Energy International, PennWest, Newalta and Titan Exploration as well as the President and Director of Impel Corporation. Mr. Daniel Bloch - Director Mr. Bloch is a partner at Aird & Berlis LLP in Toronto, and a member of the firm’s Corporate Finance Group and the Natural Resource Team. Mr. Bloch’s practice focuses on all areas of corporate finance, mergers and acquisitions and security law. Mr. Block regularly represents and provides general corporate and securities law advice to publicly and privately held corporations in a wide variety of industries. He has developed a particular expertise in advising issuers and underwriters in connection with public and private financings. VESTA CAPITAL CORP. COPYRIGHT 2010 6
  7. 7. HUASNA, CALIFORNIAHUASNA FIELD LOCATION IN CALIFORNIA, UNITED STATES Huasna Field is located in southern California near the town of San Luis Obispo, north of similar giant oil fields. VESTA CAPITAL CORP. COPYRIGHT 2010 7
  8. 8. Huasna Field California: Potential OOIP Total OOIP (MMbbls) 1600 1500 1400 1200 Million BarrelsTotal 1000Porosity 800volume 600 510 400 310 200 0 270 acres 450 acres 1350 acres Recovery Potential (MMbbls) 120 100 Million Barrels 80 70 60 40 35 23 20 21 12 7 14 4.2 7 0 270 acres 450 acres 1350 acres RF: Recovery Factor 27% RF 30% RF 45% RF 8 VESTA CAPITAL CORP. COPYRIGHT 2010
  9. 9. HUASNA FIELD:Tm Structure - Zoom CLOSURE SIZE POTENTIAL 3000 ac closure Location of 20 ac Pilot Project •Low geological risk •2,500’ frac oil pay 450 ac closure •6,200,000 bbls OOIP (frac. Por. only) •Well IP expected >200 bopd 20 ac Pilot Project 20 Acre Pattern size 10 acre well spacing SD#1 well with >2000’ 74,400,000 bbls OOIP – Matrix and fracture Monterey Oil pay porosity outside of pool closure Source: data for 51-101 VESTA CAPITAL CORP. COPYRIGHT 2010 9
  10. 10. HOW TO BUILD UP >0.5 BILLION BBLS OOIP at HuasnaFracture Porosity and Matrix Porosity Fracture Porosity only Current N1-51-101 gives 2% porosity over 270 ac for 1300’ pay = OOIP 31,134,000 bbls with 14,000,000 bbls recoverable (45% RF) Same rock just different knowledge of the Monterey Shale type oil pools Matrix and Fracture Porosity gives 24% porosity over 270 ac for 1300’ pay = OOIP 373,062,860 bbls with 26,114,000 bbl recoverable (7% RF): 37,306,000 bbl recoverable (10% RF). Remember current NI 51-101 states closure is 450 acres so for 1300’ pay of matrix and fracture porosity = OOIP 622,000,000 bbls. Structure is larger then 450 ac. VESTA CAPITAL CORP. COPYRIGHT 2010
  11. 11. Huasna Field: Net Production Forecast 5,000 4,500 Current EIR Limit Upside potential 4,000 based on 1,560 additional wells 3,500 drilled 3,000 bopd 2,500 2,000 1,500 2,900 1,000 910 500 400 - 2011 2012 201?  Production growth can be financed from current financing and through organic cash flow  Excludes any development and acquisition opportunities that are being pursued 11 VESTA CAPITAL CORP. COPYRIGHT 2010
  12. 12. HUASNA HISTORY: PROVEN PRODUCTION Cold production: The discovery well drilled in 1939 to test a surface anticline cold produced 9-13° API oil from fractured Monterey Shale EOR steam and hot water:  2 wells drilled in 1960’s produced 22,741 bbls oil after a single non-continuous steam and hot water injection  A single well had production rates of 43 bopd for one year and a month high of 163 bopd An independent report* (NI 51-101 report) suggests:  a best estimate recovery of 7,002 MSTB (net 4,551 MSTB)  a high estimate of 14,004 MSTB (net 9,102 MSTB) and  a low estimate of 4,201 MSTB (net 2,730 MSTB)* For a 270 acre project, for fracture porosity only (the closure could be from 450 to >1350 acres) VESTA CAPITAL CORP. COPYRIGHT 2010 12
  13. 13. HUASNA FIELD: FUTURE STRATEGY Exploit with hot water injection;  three well Pilot Project will initiate the Huasna project  followed by up to 9 additional wells to ramp up productions Drill the first well to obtain data on fluid properties, fracture distribution, orientation and fracture aperture size  These data will be put into a computer simulation model to spot and drill the next two wells For 6 to 12 months the pilot project is expected to produce data to facilitate the full scale development of the Huasna Field starting with the next 9 wells Evaluate the results VESTA CAPITAL CORP. COPYRIGHT 2010 13
  14. 14. HUASNA FIELD: FIRST THREE WELLS Potential Pilot Project Size and Location Cross Section A 20 Acre Pattern size ’ 10 acre well spacing 6,200,000 bbls OOIP – fracture porosity only Producer 20 Acre Pattern size 10 acre well spacing 1st well 74,400,000 bbls OOIP – Matrix and fracture 600 porosity feet Producer Future Producer 933 feet Reserve Calculations 20 acres, 2500feet pay, 2% Porosity, 20% SW A VESTA CAPITAL CORP. COPYRIGHT 2010 14
  15. 15. HUASNA FIELD: CROSS SECTION Anticline A Structural Section A-A’’ LH#1 UD#1 Elevation in 2000 Syncline SD#1 LH#2 A’ feet Known Oil zone +650 +781 +407 15,072 bbls oil over 12 months; average 41 bopd +98 with one month 163 bopd -120 Perf 900 to 2200; 4 day test 80- -321 fw -368 TD 1340 ? 100 bopd/170-200 bwpd Perf 2200 to 3200; 9 day pump 40 bopd/260 bwpd fresh. -893 7,669 bbls oil over 20 ? Uknown potential Unknown months, but only produced Potential ? - 1324 12 monhts TD 2986 - ? ? - - 1893 2052 1789 ? Fractures No samples Tentative O/W - continue No3123 contact shows TD 5591 -4370 start of samples -4615 oil sst ? No shows in fractures or other sandstones -5316 1000’ ?? TD 7733 -6585 oil sst Base – Vaqueros Fm ? ? VESTA CAPITAL CORP. COPYRIGHT 2010 15
  16. 16. HUASNA FIELD: PILOT PROJECT Drilling Permits issued – Nov, 2010 First well drilled – Jan, 2011 Production Net Cumulative  On production – Jan 2011 200 bopd 130 bopd 2nd and 3rd well drilled – April 2011  On production – May 2011 400 bopd 390 bopd Additional wells drilled (9 wells) from Nov 2011  An additional 1600 to 1800 bopd gross ~1600 bopd VESTA CAPITAL CORP. COPYRIGHT 2010 16
  17. 17. PERMIT STATUS EIR finished and submitted – July 22, 2009  Project Application and Supplement, Engineering Report, Botanical – Biological Report, Geological Hazards Report, Acoustical Report, Air Emissions Report, Cultural Resources Report, Hydrology Report, Traffic Report, Title Reports and Easement  Permits to drill from DOGGR expected Nov., 2010 VESTA CAPITAL CORP. COPYRIGHT 2010 17
  18. 18. HUASNA FIELD: ESTIMATED COMPANY NET VALUE Net Value based on Discounted Free Cash Flows* Annual Discount Rate Company Net Value % (Figures in $US millions) o 295.2 5 183.9 10 122.6 15 86.5 20 63.9 •Above figures have been adjusted to represent the stake of 65% (Unadjusted for risk) •Based on Arithmetic Average of low, best and high estimate •Figures based on NI 51-101 Report and consists only of 270 acres closure and only the fracture porosity is addressed VESTA CAPITAL CORP. COPYRIGHT 2010 18
  19. 19. HUASNA FIELD PROJECT:CASH FLOW SCENARIO ANALYSIS PV of Free Cash Flows (Sensitivity Analysis): Figures in Million USD* Discount Rate Best Estimate Low Estimate High Estimate 0% 246.7 114.9 542.1 5% 157.4 139.0 344.8 10% 108.5 96.8 237.7 15% 79.5 71.4 172.8 20% 61.1 55.1 132.5 25% 48.7 44.1 105.7 30% 40.0 36.3 86.8 * Above calculations are based on 65% projected stake in the company’s name, before tax Variable expenses for cash flow purposes have been increased on pro rata basis These data are only for the 270 acre closure and only the fracture porosity was addressed VESTA CAPITAL CORP. COPYRIGHT 2010 19
  20. 20. Additional Opportunities-Bypass Pay Zones In Canada pursue with new technology abandoned or suspended oil fields that have had a history of low recover. In California 6 bypass pay zones high graded from hundreds of leads, both light and heavy oil;  mainly shallow reservoirs with potential confirmed by other data  average size pool will be 1 to 3 million bbls BOE  average well production will be about 50 bopd and 100,000 bbls recoverable oil. John Master’s larger prospects in the USA – in the evaluation process 20 VESTA CAPITAL CORP. COPYRIGHT 2010
  21. 21. Transaction Structure Vesta Capital Corp. (Capital Pool Company – (VES – TSX.V)) Qualifying Transaction is completed and Vesta will be renamed United Hunter Oil and Gas Ltd. at the AGM and is a business combination with United Hydrocarbon Corporation and the share purchase from 2 other companies of an aggregate 65% interest in Excelaron LLC (Huasna Oil Field). $9,000,000 Canadian were raised. Basic Shares Exchange Ratio Final Shares Warrants FD Shares PercentageVesta 6,303,000 1.000 6,303,000 580,000 6,883,000 5.5%UHC 22,500,000 1.7754 39,946,721 39,946,721 32.1%4% Interest Acquisition 2,253,001 1.7754 4,000,000 4,000,000 3.2%Financing Consulting fee 5,746,999 1.7754 10,203,276 10,203,279 8.2%Total Post-Financing 36,803,000 60,453,000 580,000 61,033,000 49.0%Financing 45,000,000 1.3300 59,850,000 3,600,000 63,450,000 51.0%Total Post Financing 81,803,000 120,303,000 4,180,000 124,483,000 100.0% 21 VESTA CAPITAL CORP. COPYRIGHT 2010
  22. 22. Use of ProceedsFirst Production CDN$9,000,000 (Net $8,280,000)  Huasna: drill 3 wells, temp. facilities, 6 month op $2,000,000  Acquire and drill 2 by passed California or Canadian prospects $1,000,000  G&G development of John’s prospects $500,000  Huasna: drill 4 additional wells, perm. facilities $3,000,000  Acquire and drill 2 more by passed California or Canadian prospects $1,000,000  Acquire land JM prospects and/or other ops $780,000 TOTAL EXPENDITURES $8,280,000 • maximum $9MM raised objective is net 800 bopd Huasna & 150 bopd light oil other prospects and be positioned in an additional larger play (all points above) 22 VESTA CAPITAL CORP. COPYRIGHT 2010
  23. 23. Investment SummaryExperienced management team with 30 years of experience Past producing oil field asset in California (65% working interest in the Huasna Field) located north of producing giant oil fields. Low risk, development opportunity at Huasna with a short time to production (by Q4 2010) Huasna has significant upside potential beyond the resource defined in the current conservative 51-101 report Inventory of larger concept prospects generated by John Masters Additional low risk, by-pass pay opportunities in California and Canada to be pursued concurrently 23 VESTA CAPITAL CORP. COPYRIGHT 2010
  24. 24. CONTACT INFORMATION Vesta Capital Corporation Contacts Dr. Arthur Halleran CEO – 403-667-4941 arthur.halleran@yahoo.ca Head Office Address: Suite 310 Brisco Capital Partners Corp. 700 – 4th Avenue SW Scott Koyich President – 403-262-9888 skoyich@briscocapital.com Calgary, Alberta Canada T2P 3J4 Graeme Dick – 403-561-8989 graeme@briscocapital.com VESTA CAPITAL CORP. COPYRIGHT 2010 24
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