Call us : (250) 377-1182
facebook twitter linked-in
opawica ntg fairmount lingo media lux

KFG.V - KFG Resources Ltd.(Light Oil)



Hello there guest! Want to join in on the conversation? Login or register for a forums account by visiting this link.


By mrduediligence

Posted: Monday Nov 6 7:35:38PM 2017

KFG unit abandons Hogue Estate well in Mississippi

2017-11-06 13:32 MT - News Release

Mr. Robert Kadane reports

KFG OPERATIONS UPDATE

KFG Resources subsidiary, KFG Petroleum Corp. (Natchez, Miss.), abandoned its Hogue Estate No. 1 well in Adams county, Miss., as a dry hole. The company had sold all of the working interest and was scheduled to back in after payout if the well was successful; consequently, all costs were recovered including acreage and the company received a $10,000 overhead fee for operating. Recovery of these costs virtually paid for the company's recently announced small production purchase.

The company is hopeful that the higher prices currently being experienced will hold which will make it easier to raise capital for its drilling projects in the future.

The company's common shares are listed on the TSX Venture Exchange under the symbol KFG.

© 2017 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Thursday Oct 19 7:07:27AM 2017

KFG to drill 7,200-foot wildcat well in Mississippi


2017-10-19 07:41 MT - News Release

Mr. Robert Kadane reports

KFG TO DRILL 7200' WILDCAT WELL, ADAMS COUNTY, MS

KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp. (Natchez, Miss.), is set to drill a 7,200-foot wildcat well in Adams county, Mississippi, testing several Wicox sands that have produced in the immediate area. The Hogue Estate No. 1 well is located in Adams county, Mississippi, on a 300-acre lease burdened with a 25-per-cent royalty, leaving the company with a 75-per-cent net revenue interest. KFG has taken on partners, will have no exposure in the drilling of the well to total depth, and will recover approximately $10,000 from reimbursement for the leases plus a $10,000 overhead charge. If productive, the company will back in after payout for a 12-per-cent working interest with no outlay of completion expenses.

In addition, the company closed the purchase, effective Oct. 1, 2017, of a 1-per-cent working interest in several of its operated wells in Mississippi, which will have an immediate impact on cash flow.

© 2017 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Tuesday Oct 3 9:43:55AM 2017

By mrduediligence

Posted: Thursday Sep 28 12:29:52PM 2017

KFG Q1 2017 Results (Ending July 31st 2017)

All Information Below Can Be Found At www.Sedar.com

 

Balance Sheet End Of Quarter (All Funds in US Dollars)

 

ASSETS – In US Dollars
Cash: $615,926
Accounts Receivable: $216,881
Prepaid Expenses: $10,700

Exploration & Evaluation Assets: $129,941
Property & Equipment: $499,002

Total Assets: $1,472,450

 

LIABILITIES – In US Dollars

Accounts Payable: $473,577
Decommissioning Liability: $195,125

Total Liabilities: $668,702

 

Revenue For Q1

Oil & Gas: $241,204
Management Fees: $82,096
Total Revenue: $323,300
Total Expenses: $305,499
Net Income: $17,801

 

Average Daily Production For Q1: 65.47bopd
Number Of Producing Wells: 19
Average Oil Price: $46.86

**Notes**

-          Cost reductions did not commence until June ( As per May 10th News)

-          Production purchase reduced cash by $40,000 for Q1 and $20,000 for Q2

 

MD&A Highlights

 

Overall Performance

 

For the three months ended July 31, 2017, the Company had cash flow from oil and gas production of $159,687, compared to $101,647 for the three months ended July 31, 2016. Oil production increased from 60.88 BOPD to 65.47 BOPD, and gas production increased 1.28 MCF per day. The average price of gas increased $0.27 per MCF and the average price of crude oil increased $4.27 per bbl when comparing the three months ended July 31, 2017 and July 31, 2016.

 

As of July 31, 2017, two instalments of the production purchase in Jefferson County, MS have been paid with the remaining instalment to be paid by the end of September. As of now, the Company is optimistic that one of its new projects will be drilled in October 2017 weather permitting.

 

As of July 31, 2017, the Company generated $93,291 of cash provided by operations versus a loss of $113,517 in cash in the comparable quarter of 2016, and was able to show an actual increase in cash after all expenditures. The Company’s current rate of assets to liabilities is 1.78 and its quick ratio is 1.3.

 

Outlook

 

The Company production has been stable in the past year showing minimal decline. Oil prices appear to be slowly increasing into the low $50/bbl range. In June and July 2016, the Company took initial steps to reduce its overhead. Management salaries were cut and a field hand was let go resulting in a savings of about $9,000 per month going forward. Reduced insurance amounted to a savings of $1,100/month. Office reductions, rent and parking were reduced affecting a savings going forward of $10,800/month in salaries and overhead. Additional reductions were made in June 2017, amounting to another $8,500 per month. The Company is now generating free cash flow amounting to $93,291 in the quarter ending July 31, 2017 and is starting to move forwarding raising money for its drilling program.

 

Share Capital

 

The total number of shares outstanding as at July 31, 2017 and September 28, 2017, is 50,584,144. As of July 31, 2017 and September 28, 2017, there were no stock options or warrants outstanding.

 

Additional information pertaining to the Company is available on the SEDAR website at www.sedar.com

 

 

 

 

 

 

 


By mrduediligence

Posted: Friday Aug 25 10:57:40AM 2017

KFG Year End Results (Ending April 30th 2017) + Oil Reserves
All Information Below Can Be Found At www.Sedar.com

Financials + MD&A Summary + 51-101 Reserve Report

Balance Sheet Year End

ASSETS – In US Dollars
Cash: $593,972
Accounts Receivable: $229,863
Prepaid Expenses: $10,497
Exploration & Evaluation Assets: $119,325
Property & Equipment: $477,591
Total Assets:  $1,431,248

LIABILITIES – In US Dollars
Accounts Payable: $450,679
Decommissioning Liability: $194,622
Total Liabilities: $645,301

Asset/Debt Ratio: 2.2:1

Revenue
Oil & Gas: $1,184,011
Management Fees: $191,979
Total Revenue: $1,375,990
Total Expenses: $1,865,689
Total Loss: $489,699 -  $255,012 Depletion & $81,727 Dry hole Expenses
Loss From G&A: $152,960 – 35% of this from Q1 2016 before initial cost cuts

MD&A Summary

Average Yearly Production: 63.87bopd
Number Of Producing Wells: 22

Oil prices appear to be stabilizing in the mid $45 to $55 range. In June and July 2016, the Company took initial steps to reduce its overhead by $10,800 per month. Additional cuts were made effective June 1, 2017, letting go of two office personnel, and eliminating their health insurance. In addition, key man insurance on both the President and Vice President was terminated. Total savings account for $8,500 per month going forward. Also the small production purchase should increase oil income $1,700 to $2,000 per month at current prices. In addition, KFG has two leases where it’s working interest is between 6 and 9% (the Craig #3 lease and the Barnum lease). Both leases could possibly payout within the next twelve months unless further drilling takes place. At payout, KFG’s working interest would jump to approximately 22%. If the environment stabilizes and continues to improve, KFG will look for reasonable production purchases.

Revenue from the sale of oil and gas was $1,184,011 for the year ended April 30, 2017, compared to $1,380,325 for the year ended April 30, 2016. The decrease in revenue was a result of less production during the year.

Management fee revenue for the year ended April 30, 2017 was $191,979 as compared to $287,841 for the year ended April 30, 2016. The decrease is a result of substantially less work for the Company and others because of low oil prices in the field.

Dry hole costs and abandonments for the year ended April 30, 2017 were $81,727 as compared to $2,690 for the year ended April 30, 2016. The decrease resulted from the write off of two Mississippi projects that were unsuccessful and impairment charges against the oil and gas properties.

Lease operating expenses were $440,783 for the year ended April 30, 2017 compared to $553,808 for the year ended April 30, 2016. The decrease in lease operating expenses is a result of suspending lease operations in certain areas.

General and administrative expenses for the year ended April 30, 2017 were $1,122,564 compared to $1,347,373 for the year ended April 30, 2016. The decrease is a result of terminating two employees during the year and a decrease in insurance premiums.

Depletion and amortization costs for the year ended April 30, 2017 were $225,012 compared to $540,840 for the year ended April 30, 2016, reflecting depletion on the Company’s reserves. The decrease is a result of a decreased cost base subject to depletion and a reduced depletion rate.

The Company reported a net loss of $489,699 for the year ended April 30, 2017 compared to net loss of $777,709 for the year ended April 30, 2016, with the lower net loss arising from reduced operating expenses and reduced depletion.

The total number of shares outstanding as at April 30, 2017 and August 24, 2017, is 50,584,144. As of April 30, 2017 and August 24, 2017, there were no stock options outstanding. There were no warrants outstanding as at April 30, 2017 and August 24, 2017.

Overall Performance

Updating to April 30, 2017, KFG moved its offices to 150-A Providence Rd, Natchez, MS. Office rent is unchanged. Two employees were terminated beginning June 1, 2017 and insurance on the two principal officers was dropped with a total savings going forward of $8,500 per month. The Company has completed a small production purchase for $60,000, payable in three monthly installments of $20,000, equal to approximately 5% of the Company’s production in Jefferson Co., MS. The Company has two projects to drill but has not been able to raise sufficient capital to drill the wells without affecting the Company’s cash position dramatically if the projects are not productive.


KFG 51-101 Reserve Report Ending April 2017
51-101 2017 Net To KFG (Table 1)
Oil
Total Proved Reserves – 80.3 Mbbl
Probable Reserves – 46.6 Mbbl
Total Proved + Probable – 126.8 Mbbl
Natural Gas
Total Proved Reserves – 4.5 MMcf
Net Present Value For 2017 (Table 2) - USD
Total Proved + Probable - $3,635,000

KFG 51-101 Reserve Report Ending April 2016
51-101 2016 Net To KFG (Table 1)
Oil
Total Proved Reserves – 81.3 Mbbl
Probable Reserves – 45.8 Mbbl
Total Proved + Probable – 127 Mbbl
Natural Gas Reserves – 0
Net Present Value For 2016 (Table 2) – USD
Total Proved + Probable - $3,610,000

KFG 51-101 Reserve Report Ending April 2015
51-101 2015 Net To KFG (Table 1)
Oil
Total Proved Reserves – 72.2 Mbbl
Probable Reserves – 56.5 Mbbl
Total Proved + Probable – 128.7 Mbbl
Natural Gas Reserves – 0
Net Present Value For 2015 (Table 2) – USD
Total Proved + Probably - $5,140,000 **Higher oil prices**


By mrduediligence

Posted: Wednesday Jul 12 10:00:32AM 2017

KFG acquires working interest in Fayette field


2017-07-12 10:40 MT - News Release

 

Mr. Robert Kadane reports

KFG PURCHASES WORKING INTEREST AT FAYETTE

KFG Resources Ltd. subsidiary KFG Petroleum Corp., of Natchez, Miss., purchased a 5.47-per-cent working interest in the Fayette field, Jefferson county, Mississippi, effective July 1, 2017. It is payable in three monthly instalments of $20,000 each. Payout, assuming no oil price increases, is 35 months. No debt will be taken on to finance the transaction.

© 2017 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Wednesday May 10 8:02:59AM 2017

KFG Resources' KFG Petroleum to lay off two employees

 
2017-05-10 08:32 MT - News Release

 

Mr. Robert Kadane reports

KFG RESOURCES TO ADMINISTER FURTHER COST CUTTING MEASURES

KFG Resources Ltd. subsidiary KFG Petroleum Corp., of Natchez, Miss., has implemented further cost reductions in order to counterbalance the reduction in oil prices. Starting in June, the company overhead will be reduced as two additional employees are released, saving on salaries and insurance.

For the month of March, KFG Petroleum produced an average of 65.4 barrels of oil per day from 19 wells. Management is looking at numerous ways to increase shareholder value.

However, there can be no assurance that a deal will be reached. KFG's drilling program is slated to start in the summer, pending the stabilization of oil prices and financing from joint venture partners.

© 2017 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Friday Apr 7 8:49:01PM 2017

April 2017 Company Presentation - http://kfgresources.com/wp-content/uploads/2016/09/KFG-April-2017-Company-Presentation.pdf


By mrduediligence

Posted: Thursday Jan 5 12:31:17PM 2017

January 2017 Company Presentation - http://kfgresources.com/investors/


By mrduediligence

Posted: Tuesday Dec 6 8:09:45PM 2016

Good article about the top oil jurisdictions in the world right now - http://www.oilandgas360.com/oklahoma-attractive-place-oil-gas-investment/

By mrduediligence

Posted: Thursday Nov 3 4:14:59PM 2016

KFG unit seeks financing for drilling in Mississippi
 
 
2016-11-03 13:40 MT - News Release
 
Mr. Robert Kadane reports
 
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.
 
© 2016 Canjex Publishing Ltd. All rights reserved.

By mrduediligence

Posted: Friday Oct 14 5:58:15AM 2016

By mrduediligence

Posted: Monday Oct 10 8:09:11PM 2016

KFG Resources appoints Haney, Grassi as directors

2016-10-07 07:38 MT - News Release

Mr. Robert Kadane reports

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.

© 2016 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Wednesday Dec 30 6:40:16PM 2015

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.

Price: $0.05
Common Shares: 50,584,144
Insider/Institutional Holdings: 17%

Financials(In US Dollars)

Assets
Cash: $1,818,812( $2.5 million CDN or $0.05c a share)
Accounts Receivable: $239,482
Prepaid Expenses: $33,225
Reclamation Bond: $20,000
Property and equipment: $992,051
Total Assets: $3,103,570

Liabilities
Accounts Payable: $1,007,729
Decommissioning Liability: $235,060
Total Liabilities: $1,242,789

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 higher 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

MD&A Highlights

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.

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.

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.

Share Capital

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.

Outlook

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.

 


By mrduediligence

Posted: Wednesday Dec 2 7:11:20AM 2015

KFG unit places Barnum No. 4 on production

2015-12-02 07:29 MT - News Release

Mr. Robert Kadane reports

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.

© 2015 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Thursday Nov 5 10:17:30AM 2015

KFG Resources completes Drouet Poole Estate No. 1 well

2015-11-05 10:05 MT - News Release

Mr. Robert Kadane reports

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.

© 2015 Canjex Publishing Ltd. All rights reserved.

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.


By mrduediligence

Posted: Monday Oct 19 6:56:14AM 2015

KFG Resources working on Barnum No. 4 well completion

2015-10-19 07:40 MT - News Release

Mr. Robert Kadane reports

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.

© 2015 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Thursday Oct 15 7:01:54AM 2015

KFG News release. An update on the Mississippi wells along with Texas. I have also found an article which links the CEO of KFG Resources back to Texas. This shows how his family has been involved in the Witchita area for almost eighty years. It is very significant because it means the CEO has a better idea of the oil in that area than any other large cap company. After all, Robert Kadane's family created that city because of the industry they started. I confirmed this information with the CEO of KFG Resources, you can always call or email him yourself.

KFG completing Drouet Poole Estate, Stockfelt wells
2015-10-14 13:29 MT - News Release

Mr. Robert Kadane reports
KFG OPERATIONS UPDATE
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.
© 2015 Canjex Publishing Ltd. All rights reserved.

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.


By mrduediligence

Posted: Tuesday Sep 29 4:54:56AM 2015

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

Price: $0.08

Common Shares: 50,584,144

Options/Warrants: 0

Insider Holdings: 16%

Financials

ASSETS
Cash: $1,499,459 (last quarter was $1,401,025)
Accounts Receivable: $291,245

Prepaid Expenses: $12,856

Reclamation Bond: $20,000

Property & Equipment: $932,204

Total Assets: $2,755,764

LIABILITIES
Accounts payable: $453,535

Decommissioning Liability: $243,311

Total Liabilities: $696,846 (last quarter was $765,590)

Sales

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

MD&A Highlights

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.

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.

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.

Outlook

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.


By mrduediligence

Posted: Wednesday Sep 23 3:03:32PM 2015

KFG logs, core nine feet of oil sand at Third Wilcox

2015-09-23 12:12 MT - News Release

 

Mr. Robert Kadane reports

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.

© 2015 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Monday Sep 14 4:39:56PM 2015

KFG drills 10 ft of McShane oil sand in Mississippi 2015-09-14 13:45 MT - News Release Mr. Robert Kadane reports 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. © 2015 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Friday Aug 28 6:31:02PM 2015

KFG Year End Results Ending April 30th 2015

Current Price: $0.08

Common Shares: 50,584,144

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*

ASSETS

Cash: $1,401,025 - (2014 $1,205,750)

Accounts Receivable: $482,880
Prepaid Expenses: $13,274
Reclamation bond: $20,000

Property and Equipment: $901,766

Total Assets: $2,818,945 - (2014 $3,017,302) 

LIABILITIES

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.

Sales

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.

Fourth Quarter

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.

Outlook

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.


By mrduediligence

Posted: Wednesday Aug 5 3:44:19PM 2015

2015-08-05 12:22 MT - News Release

Mr. Robert Kadane reports

KFG OPERATIONS UPDATE

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.

© 2015 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Saturday Jul 18 7:13:48AM 2015

Heavy insider buying on KFG: https://www.insidertracking.com/company?menu_tickersearch=KFG%2ACA%20%7C%7C%20KFG%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

Transaction
Date

Transaction Nature

# or value acquired
or disposed of

Price

Account
Balance

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

20,000

$0.090

5,984,000

  Jul 17/15

10 - Acquisition in the public market

2,000

$0.085

5,964,000

  Jul 14/15

10 - Acquisition in the public market

2,500

$0.090

5,962,000

  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

  Jul 6/15

10 - Acquisition in the public market

17,000

$0.080

5,946,500

  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 23/15

10 - Acquisition in the public market

1,000

$0.105

5,989,500

  Apr 22/15

10 - Acquisition in the public market

500

$0.090

5,988,500

  Apr 22/15

10 - Acquisition in the public market

2,000

$0.085

5,988,000

  Apr 2/15

10 - Acquisition in the public market

1,000

$0.100

5,986,000

  Apr 2/15

10 - Acquisition in the public market

5,000

$0.090

5,985,000

  Mar 26/15

10 - Acquisition in the public market

5,000

$0.080

5,980,000

  Mar 24/15

10 - Acquisition in the public market

2,500

$0.080

5,975,000

  Mar 20/15

10 - Acquisition in the public market

5,000

$0.085

5,972,500

  Mar 13/15

10 - Acquisition in the public market

7,500

$0.080

5,967,500

  Mar 11/15

10 - Acquisition in the public market

5,000

$0.085

5,960,000

  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

  Mar 4/15

10 - Acquisition in the public market

10,000

$0.090

5,940,000

  Feb 27/15

10 - Acquisition in the public market

5,000

$0.080

5,930,000

  Feb 12/15

10 - Acquisition in the public market

3,000

$0.105

5,925,000

  Feb 12/15

10 - Acquisition in the public market

2,000

$0.100

5,922,000

  Feb 10/15

10 - Acquisition in the public market

5,000

$0.105

5,920,000

  Feb 9/15

10 - Acquisition in the public market

5,000

$0.105

5,915,000

  Feb 5/15

10 - Acquisition in the public market

5,000

$0.105

5,910,000

  Feb 2/15

10 - Acquisition in the public market

1,000

$0.125

5,905,000

  Feb 2/15

10 - Acquisition in the public market

4,000

$0.120

5,904,000

  Feb 2/15

10 - Acquisition in the public market

2,000

$0.125

5,900,000

  Feb 1/15

10 - Acquisition in the public market

23,000

$0.120

5,883,000

  Feb 2/15

10 - Acquisition in the public market

15,000

$0.110

5,898,000

  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 28/15

10 - Acquisition in the public market

5,000

$0.095

5,850,000

  Jan 21/15

10 - Acquisition in the public market

5,000

$0.090

5,845,000

  Jan 20/15

10 - Acquisition in the public market

10,000

$0.090

5,840,000

See more at: https://www.insidertracking.com/company?menu_tickersearch=KFG%2ACA%20%7C%7C%20KFG%20Resources#sthash.tetB2xlO.dpuf

 


By mrduediligence

Posted: Monday Jul 13 4:04:48PM 2015

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.
 
KFG Year End Results in 2009
- Cash:$1.62M, Total Assets: $2.33M, Total Debt: $156K
- Revenue: $645K, Net Loss For The Year: $456K
- Shares Outstanding: 42,147,311
- Additional Funds Raised
 
KFG Year End Results in 2010
- Cash: $304K, Total Assets: $1.84M, Total Debt: $640K
- Revenue: $997K, Net Loss For The Year: -$1.4M
- Shares Outstanding: 47,786,580
- Additional Funds Raised
 
KFG Year End Results in 2011
- Cash: $1.03M, Total Assets: $2.94M, Total Debt: $834K
- Revenue: $2.9M, Net Income For The Year: $832K
- Shares Outstanding: 50,480,644
- 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. 

KFG Year End Results in 2012
- Cash: $637K, Total Assets: $2.43M, Total Debt: $439K
- Revenue: $3.5M, Net Loss For The Year: $144K
- Shares Outstanding: 50,559,191
- 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. 
 
KFG Year End Results in 2013
-  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.
 
KFG Year end Results in 2014
- Cash: $1.21M, Total Assets: $3.02M, Total Debt: $880K
- Revenue: $2.7M, Net Income For The Year: $67K
- Shares Outstanding: 50,584,144
-  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
-  Shares Outstanding: 50,584,144
-  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.

 


By mrduediligence

Posted: Monday Jun 29 2:39:15PM 2015

KFG Resources restarts production at all wells

2015-06-29 11:33 MT - News Release

Mr. Robert Kadane reports

KFG OPERATIONS UPDATE

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.

© 2015 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Monday May 25 5:01:59AM 2015

New article on KFG Resources from PennyStockExperts:

http://pennystockexperts.com/attractive-smart-and-relatively-wealthy-oil-operator-seeks-your-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


By mrduediligence

Posted: Monday Apr 27 3:03:24PM 2015

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.


By mrduediligence

Posted: Thursday Apr 23 5:26:13PM 2015

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

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
Location Investors % O/S Pos Val ($MM)
Canada 3 11.94 6,041,000 0.48
United States 4 4.74 2,395,242 0.13

Rotation

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

Turnover Percentage
High 0.00
Mod 0.00
Low 14.27

Concentration

Concentration
Percentage
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


By mrduediligence

Posted: Tuesday Apr 7 5:02:58PM 2015

Here's a report that I found from Morningstar and saved. It shows that KFG should be trading at 21 cents a share right now as a "fair value". Follow the link to see it: http://i1082.photobucket.com/albums/j376/JonnyR991/KFG%20Resources%20April%207th%202015%20Report.jpg


By mrduediligence

Posted: Tuesday Mar 31 7:13:21AM 2015

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.

Price: $0.075
Common Shares: 50,584,144
Insider Holdings: 17% or just over 8.5 million shares as per SEDI

Assets
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

Liabilities
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

My Note: Even though revenue went down due to the 50% decline in oil prices, KFG was still able to add cash to the company treasury and continue drilling despite 3 dry wells back to back.  Without the two events, earnings would have been much higher for the quarter.  As well, with every new producing well KFG puts online, management fee revenue will also increase on a monthly basis.

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.

Share Capital
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.

Outlook
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.


By mrduediligence

Posted: Monday Mar 9 3:32:27PM 2015

KFG shuts down Barnum, Craig operations on bad weather

2015-03-09 13:34 MT - News Release

Mr. Robert Kadane reports

KFG OPERATIONS UPDATE

KFG Resources Ltd.'s subsidiary's latest two wells -- the KFG Petroleum Corp. Barnum No. 3 and the Craig No. 5 -- are still awaiting completion. Rain, snow and ice in the past three weeks have shut down field operations. A further report will be issued when dry weather permits operations to continue. The company plans a late spring and summer drilling program with four new projects currently and two potential development wells, depending on offset well performance, all in Mississippi.

© 2015 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Monday Feb 23 5:24:21PM 2015

KFG Resources cases Barnum No. 3 well

2015-02-23 14:05 MT - News Release

 

Mr. Robert Kadane reports

KFG REPORTS STATUS OF MISSISSIPPI DRILLING PROGRAM

KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp. of Natchez, Miss., has set production casing in its Barnum No. 3 well logging several potential oil zones in the well. A completion attempt will be made in the Parker sand at 6,415 feet (the producing zone in the Barnum No. 2 well). The company has a 9-per-cent working interest in the well until payout and a 20.5-per-cent interest thereafter.

In addition, the company has run production casing in its Craig No. 5 well to 6,400 feet to test the Benbrook sand at 6,214 feet. The producing sand on the Craig lease, the second Wilcox sand at 4,348 feet, was also present and productive significantly expanding oil reserves on the lease. KFG has a 21.5-per-cent working interest in the Craig No. 5 well. As the wells are perforated and put on production a report will follow. The company also drilled two wildcats, both dry holes, in Franklin county, Mississippi, the Seale No. 1 and the Wall No. 1, both 4,600-foot shallow dry holes. The company had a 10-per-cent working interest in both wells.

© 2015 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Tuesday Jan 20 4:35:57PM 2015

 

Symbol C : KFG
Shares Issued 50,584,144
Close 2015-01-16 C$ 0.09
Recent Sedar Documents

KFG resumes drilling at Wilcox

2015-01-20 11:53 MT - News Release

Mr. Robert Kadane reports

KFG REPORTS STATUS OF MISSISSIPPI WILCOX DRILLING PROGRAM

KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp. of Natchez, Miss., has resumed its Wilcox shallow drilling program. The company is moving in on the Wall No. 1, a 4,600-foot Wilcox test, to be followed by the Seale No. 1, another 4,600-foot Wilcox test. Both wells are wildcats in Franklin county, Mississippi. KFG has a 10-per-cent working interest in both wells and, if successful, will jump to a 21.5-per-cent working interest after payout.

Also, the company is staking location to offset its Barnum No. 2 well in Adams county, Mississippi, a 6,700-foot Wilcox test. The Barnum No. 2 well has already produced 10,000 barrels, and has settled down to a rate of 70 barrels of oil per day. The Barnum No. 3 well will be drilled as weather permits, probably in early February. KFG has a 9-per-cent working interest in the Barnum lease, increasing to a 20.5-per-cent working interest at payout.

© 2015 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Tuesday Dec 30 3:45:12PM 2014

KFG Resources earns $611,881 in fiscal H1 2014

2014-12-30 12:56 MT - News Release

Mr. Robert Kadane reports

KFG LOGS SOLID FIRST HALF FISCAL 2014

KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp. of Natchez, Miss., had revenue from the sale of oil and gas of $1,491,772 for the six months ended Oct. 31, 2014, compared with $1,129,981 for the six months ended Oct. 31, 2013. Management fee income was $220,523 for the period, compared with $211,028 for the corresponding six-month period in 2013. The company reported net income of $611,881 for the six months ended Oct. 31, 2014, compared with $238,365 for the comparable 2013 period. The company had cash on hand of $1,836,298 with total liabilities of $764,620. Current assets were $2,271,974. The company's operating costs per barrel for the six-month period ending Oct. 31, 2014, were $18.85 per barrel. Free cash flow for the period was $991,000 after all expenses.

Operationally, the Craig No. 4 well had oil shows but it was not considered commercial. KFG's drilling program for calendar 2015 will be unaffected by the decline in oil prices to date. KFG anticipates drilling activity to resume in February, 2015, with the drilling of three wells, starting with offsetting the company's Barnum Mp. 2 well in Adams county, Mississippi, and continuing with two shallow wildcats in Franklin county, Mississippi.

© 2014 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Tuesday Dec 23 4:58:49AM 2014

KFG Q2 Results Ending October 31st 2014:

Assets

Cash: $ 1,836,298  ($0.036c in cash compared to $1.14 million in July 2014)

Receivables: $403,296

Prepaid Expenses: $32,380

Reclamation Bond: $20,000

Property & Equipment: $1,222,247

Total Assets: $3,514,221

Liabilities

Accounts Payable: $726,247

Deposits from Co-Owners: $38,373

Total Liabilities: $764,620 

Revenue after 6 months (2 Profitable Quarters)

Oil and gas: $1,491,772

Management Fees: $22,523

Total Revenue: $1,712,295

Total Costs: $1,100,414

 

Net Income: $611,881 (Net Income was $238,365 in 2013)

EPS= $611,881 / 50,584,11 = $0.012c

 

Wells in production: 25

Average production in Q2: 104bopd (75bopd was Q1, increase of 29bopd of 28%)

Average Price: $101 per bbl - LLS(Louisiana Light Sweet oil, premium to WTI)

COST per barrel - $18.85/bbl

Management Discussion and Analysis Highlights

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.

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 and a quick ratio of 2.5, 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.

The Company reported net income of $611,881 for the six months ended October 31, 2014 compared to net income of $238,365 for the six months ended October 31, 2013, with the increase in net income a result less operating expenses plus better prices for oil and new oil from the Craig and McNeil bases due to increased working interest in the wells as well as total overhead charges remaining virtually unchanged.

The Company reported net income of $151,781 for the three months ended October 31, 2014 compared to net income of $124,840 for the three months ended October 31, 2013, with the increase in net income a result less operating expenses plus new oil from the Craig and McNeil bases due to increased working interest in the wells.

( Barnum 2 likely reduced our net income this quarter as this was an expensive well)

During the quarter ended October 31, 2014, the Barnum #2 well was completed producing in excess of 100 BOPD. The Company has a 9% working interest in that well jumping to 16% at payout. The Company plans to offset that well in February 2015 as well as drill two new prospects. Gross income from oil sales increased 15% in spite of declining prices.

Outlook

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 2014 internally. The Company’s outlook for the next six months is positive. With a current ratio of 2.97, KFG is well positioned to proper during this period of much lower oil prices. At this writing, no projects will be put off or delayed. The Company anticipates its 2015 drilling program starting in February 2015.

Share Capital

The total number of shares outstanding as at October 31, 2014 and December 22, 2014, is 50,584,144. As of October 31, 2014 and December 22, 2014, there were no stock options or warrants outstanding.

 

(My Notes)

Wells that are approved and still need to be drilled next year:

Fayette Well - Announced September 11th 2014
Seale Well - Announced November 5th 2014
Wall 1 Well - Announced November 5th 2014
Barnum 3 Well - Announced November 5th 2014
Wall 2 Well - Approved through Mississippi Legislature, to be announced soon
Jones Flower Well - Approved through Mississippi Legislature, to be announced soon
Craig 3 and Barnum will pay out soon which will add instant production to KFG.


By mrduediligence

Posted: Thursday Nov 20 6:04:32PM 2014

Morningstar report on KFG: http://i1082.photobucket.com/albums/j376/JonnyR991/KFG-page-001.jpg

 

 

 

 

 

 

 

 

 

 

 

 

 


By mrduediligence

Posted: Monday Nov 17 4:25:54PM 2014

The insider buying continues while the stock price flirts with the 52 week high and could break the 6 year
resistance level of $0.15c. With 3 wells being worked on as we speak, positive results from all of them should
drive the price well into the 20 cent range.

Haney, Kevin
Insider's Relationship to Issuer: 3 - 10% Security Holder of Issuer
Transaction
Date
Transaction Nature # or value acquired
or disposed of
Price Account
Balance
Security Type: Common Shares (Direct Ownership)

Nov 14/14 10 - Acquisition in the public market 60,000 $0.130 5,690,000
Nov 14/14 10 - Acquisition in the public market 150,000 $0.135 5,630,000
Nov 14/14 10 - Acquisition in the public market 15,000 $0.125 5,480,000
Nov 7/14 10 - Acquisition in the public market 25,000 $0.105 5,465,000
Nov 6/14 10 - Acquisition in the public market 15,000 $0.115 5,440,000
Nov 5/14 10 - Acquisition in the public market 20,000 $0.115 5,425,000
Nov 4/14 10 - Acquisition in the public market 35,000 $0.125 5,405,000
Nov 4/14 10 - Acquisition in the public market 5,000 $0.120 5,370,000
Oct 29/14 10 - Acquisition in the public market 40,000 $0.130 5,365,000
Oct 27/14 10 - Acquisition in the public market 55,000 $0.130 5,325,000
Oct 27/14 10 - Acquisition in the public market 80,000 $0.120 5,270,000
Oct 24/14 10 - Acquisition in the public market 50,000 $0.090 5,190,000
Oct 21/14 10 - Acquisition in the public market 40,000 $0.085 5,140,000
Oct 14/14 00 - Opening Balance-Initial SEDI Report  

By mrduediligence

Posted: Saturday Nov 8 6:33:40AM 2014

Decent amount of insider buying this week:


 

 

As of 11:59pm ET November 7th, 2014

 

Filing
Date

Transaction
Date

Insider Name

Ownership
Type

Securities

Nature of transaction

# or value acquired or disposed of

Price

Nov 7/14

Nov 7/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

25,000

$0.105

Nov 6/14

Nov 6/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

15,000

$0.115

Nov 5/14

Nov 5/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

20,000

$0.115

Nov 4/14

Nov 4/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

35,000

$0.125

Nov 4/14

Nov 4/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

5,000

$0.120

Oct 29/14

Oct 29/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

40,000

$0.130

Oct 27/14

Oct 27/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

55,000

$0.130

Oct 27/14

Oct 27/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

80,000

$0.120

Oct 25/14

Oct 24/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

50,000

$0.090

Oct 23/14

Oct 21/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

40,000

$0.085

Oct 23/14

Oct 14/14

Haney, Kevin

Direct Ownership

Common Shares

00 - Opening Balance-Initial SEDI Report

5,100,000

 


By mrduediligence

Posted: Saturday Nov 8 6:34:37AM 2014

sorry it didn't post right, not sure why it doesn't stay near the top. Just have to scroll down a bit to see the buying. Or you can find it on www.canadianinsider.com


By mrduediligence

Posted: Wednesday Nov 5 4:52:08PM 2014

In regards to the news release today it states KFG is producing at slightly under 100bopd, so I would guess around 98bopd. Now I am not too sure as to why the number is so much lower than what was posted on the website on November 1st. Is it possible that a couple wells were shut down between Sunday-Tuesday? maybe. But either way, since we know production increased in Q2, lets redo the estimated quarterly results. I have a confirmed LLS number for August and we have the last price for September before the drop, lets use those as well.

http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=F003075773&f=M   =====> $98.31 was the average price in August for LLS

http://www.petroleumnewsbakken.com/pntruncate/501597498.shtml   ======> LLS was trading at $96.29 October 2nd, so September average should be at least $96

October prices dropped, but LLS is always around Brent, lets use $84 for this month

$98.31 + $96 + $84 = $92.77 or lets say $93, which is what I calculated as an average for Q2 in my previous post.

$93(per barrel average) X98BOPD X 90(Days in Q2) = $820,260 in oil revenues for the second quarter(estimate)

Then we add $120,000 for management fee's which puts us at $940,260 total revenue. Again lets use the $500,000 in expenses since it's higher than Q1 and might be due to extra costs from Craig 3 and Barnum 2. 

$940,260 - $500,000 = $440,260 net income (estimate)

I'm pretty sure KFG will earn around $400,000 to $500,000 for the first 3 quarters, then in Q4 all the payouts and new wells will add significant revenue. $0.04-0.05c EPS for 2015 isstill an achievable target. 

- 3 wells confirmed to do soon

- 2 wells to pay out and given their current numbers, it's an extra 20-25bopd from Craig 3 and Barnum 2

- The Franklin wells are in a new area, so results could be anywhere and could very well add new zones to

drill from. 


By mrduediligence

Posted: Wednesday Nov 5 3:44:05PM 2014

KFG Resources to drill three wells in Wilcox

2014-11-05 07:42 MT - News Release

 

Mr. Robert Kadane reports

KFG REPORTS STATUS OF MISSISSIPPI WILCOX DRILLING PROGRAM

KFG Resources Ltd.'s subsidiary, KFG Petroleum Corp. of Natchez, Miss., has three projects that are drill ready before year-end 2014. In Adams county, Mississippi, the Craig No. 4, a southwest offset to the Craig No. 3 producer, will be drilled to 6,500 feet to test all Wilcox zones of interest. In Franklin county, Mississippi, the Seale No. 1, a 4,500-foot Wilcox test, and the Wall No. 1, a 4,600-foot Wilcox test, will evaluate two new areas of interest where the company has accumulated an acreage postion.

In February, 2015, in Adams county, the Barnum No. 3, a west offset to the company's Barnum No. 2 well, currently averaging close to 120 barrels of oil per day, will be drilled to a depth of 7,000 feet, testing several Wilcox zones that have produced in the immediate area. This well will be followed by additional development in Franklin county, Mississippi.

In each of the above cases, KFG will have a 10-per-cent working interest, converting to a 21.5-per-cent interest following payout of a successful project, except for the Barnum well, where the company's interest is 9 per cent.

Current net daily production is slightly under 100 barrels of oil per day before payout of the Craig No. 3 or the Barnum No. 2 wells anticipated during the first half of calendar 2015 even if the Craig No. 4 is successful.

© 2014 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Sunday Nov 2 8:48:47AM 2014

Sorry everyone, an error was pointed out to me and I confirmed it. KFG shows a 74.9% working interest in Fayette, but only 59.4% of it is NET to them. So below are the re-calucations which are still good regardless.

Using the current numbers that were updated today on the website, here is what KFG's wells are producing as a whole and the net back to KFG. Fayette does not state a number, but if you look back at other financial statements, it shows production at a constant 110-120bopd from the 9 wells. For this chart I'm only using the lower amount.
 
Wells(name)                 Total Production            KFG's WI(net)                KFG's Cut(bopd)                   

9 Fayette                      110bopd                      59.4%                          65.5bopd
2 Macneil                     50bopd                        20.5%                          10bopd
3 Parker                       90bopd                        10%                             9bopd
3 Craig                         165bopd                   21.5% & 10%                   30bopd
1 Barnum                     140bopd                      9%                               13bopd
1 Dale                          25bopd                        17%                             4bopd
1 Miller                        12bopd                        4%                               0.5bopd
 
20 Producing               592bopd                      -                                   132bopd
 
Average WI in all wells: 132bopd(KFG) / 592bopd(Total) = 22.3% or 22% average
 
Now lets see what KFG can cash flow at $80 per barrel with LLS prices right now:
 
132(bopd) X $80(per barrel) X 90 days(quarter) = $950,400 not including management fees.
 
Below is a list of wells that either have to A) Be put back online B) Need to be drilled, or C) Have to still pay out.
 
- Craig 3 well still needs to pay out, increasing from 10% to 21.5%
- Barnum 2 wells still needs to pay out, increasing from 9% to 20.5%
- Roundtree well shut for now, needs to be put back online
- Miller well still needs to pay out, increasing from 4$ to 18%
- 1 Fayette well to be drilled soon, as per the September 11th 2014 news release
- Craig 4 well to be drilled in December 2014
- Barnum offset in first quarter of 2015, could be 2 other potential offsets
- Several Franklin areas to drill in Q1 2015 with  3 targets ready
 
All information was updated November 1st 2014 as per the main page of the KFG website.


By mrduediligence

Posted: Saturday Nov 1 9:19:47PM 2014

Using the current numbers that were updated today on the website, here is what KFG's wells are producing as a whole and the net back to KFG. Fayette does not state a number, but if you look back at other financial statements, it shows production at a constant 110-120bopd from the 9 wells. For this chart I'm only using the lower amount.

Wells(name)                 Total Production            KFG's WI                   KFG's Cut(bopd)                   

9 Fayette                      110bopd                      75%                             80bopd

2 Macneil                     50bopd                        20.5%                          10bopd

3 Parker                       90bopd                        10%                             9bopd

3 Craig                         165bopd                   21.5% & 10%              30bopd

1 Barnum                     140bopd                      9%                               13bopd

1 Dale                          25bopd                        17%                             4bopd

1 Miller                        12bopd                        4%                               0.5bopd 

20 Producing               592bopd                      -                                   146.5bopd

Average WI in all wells: 146.5bopd(KFG) / 592bopd(Total) = 24.7% or 25% average

Now lets see what KFG can cash flow at $80 per barrel with LLS prices right now:

146.5(bopd) X $80(per barrel) = $11,720 per day X 30(days) = 351,600 per month. This does not include the management fees given to KFG per well. All in costs per well is around $30 per barrel, so very good margins even with the lower prices.

Below is a list of wells that either have to A) Be put back online B) Need to be drilled, or C) Have to still pay out.

- Craig 3 well still needs to pay out, increasing from 10% to 21.5%

- Barnum 2 wells still needs to pay out, increasing from 9% to 20.5%

- Roundtree well shut for now, needs to be put back online

- Miller well still needs to pay out, increasing from 4$ to 18%

- 1 Fayette well to be drilled soon, as per the September 11th 2014 news release

- Craig 4 well to be drilled in December 2014

- Barnum offset in first quarter of 2015, could be 2 other potential offsets

- Several Franklin areas to drill in Q1 2015 with  3 targets ready

All information was updated November 1st 2014 as per the main page of the KFG website.


By mrduediligence

Posted: Saturday Nov 1 8:25:06PM 2014

KFG project information has been updated on the website. All production is current as of today. It also mentions the future wells being drilled between now and January.  

http://www.kfgresources.com/project.htm

KFG Resources Ltd., through its 100% owned U.S. operations subsidiary "KFG Petroleum Corporation" owns production and holds exploration and development interests in Louisiana and Mississippi. Daily average production for the quarter ended July 31, 2014 was 75 BOPD. Average oil price received was $102 per barrel. Oil sales for the quarter ended July 31, 2014 were $788,143 and management fee income was $116,266 totaling $904,409 as compared to $582,176 in the fiscal first quarter of 2013.

Wilcox Oil Play

KFG focuses on the Wilcox formation which is a water-drive reservoir of Eocene Age prevalent in East-Central Louisiana and Southwest Mississippi. The Wilcox is a relatively shallow horizon varying between 3500 and 9200 feet in depth. There is also the deeper Tuscaloosa formation in many areas where KFG operates and when found is known to be a prolific production horizon. KFG's projects are described below.

Mississippi

Fayette Field, Jefferson County, Mississippi

The Fayette field is located 21 miles northeast of the city of Natchez. KFG has a 74.9% working interest (59.4% net) in the field. Fayette is a salt feature covering approximately 3800 acres. Past production was from the Wilcox and the Lower Tuscaloosa formations. KFG did a 3D seismic survey in 2008 and the results led to the discovery of the Spring Hill feature in June 2009. Spring Hill is fully developed with 6 producing wells. KFG has 2 other wells at Fayette including 1 small gas well. The reprocessed 3D seismic survey reveals both shallow and a deep target which KFG intends to test in the future. The Spring Hill is past the flush part of production and is in a long slow decline.

Carthage Point Field, Adam's County Mississippi

KFG drilled the MacNeil #2 well in March 2013 and a successful offset, the MacNeil #3 in October 2013. In August 2014 payout of the project was achieved and KFG's working interest increased to 20.5% from 8%. Daily production is 50 BOPD.

LaGrange Field, Adam's County Mississippi

KFG has a 10% working interest in the Parker Lease with no reversion. Four wells have been drilled - three producers and one dry hole. Combined production on the lease is 90 BOPD and it is fully developed. Also at LaGrange but in a different part of the field, KFG drilled its Craig #1 well in November 2013 followed by its Craig #2 in January 2014. Production from both wells is about 115 BOPD. A third well, the Craig #3, was put on production in July 2014 and it is currently producing 50 BOPD. The Craig #4 well has been staked and will be drilled in December 2014. The Craig #1 and #2 wells have paid out and KFG's interest jumped from 10% to 21.5% in those wells. KFG's working interest in the Craig #3 well is currently10%

Mantua Field, Adams County, Mississippi

In September 2014 the Company completed its Barnum #2 well at 6398 feet in the Parker Sand of the Wilcox. The well is currently producing 140 BOPD and will be offset in the first quarter of 2015. KFG has a 9% working interest in that well, jumping to 20.5%at payout. At this writing there appears to be three potential offsets.

Franklin County, Mississippi

There are several areas in Franklin County being leased by the Company which KFG intends to drill in the first Quarter 2015. Depths range from 4400 feet to 6800 feet. In each instance KFG has mitigated its risk by only keeping a 10% working interest and, if successful, backing in for up to an additional 16.25%. At present three of these projects are drill ready.

Louisiana

Concordia Parish, Louisiana

KFG has three leases in Concordia Parish. The Dale lease went off production in April 2013 and was returned to production in May 2014.after being shutin for a year waiting on saltwater disposal well approval. The lease is currently producing 25 BOPD from two well with an average working interest of 17%. The Roundtree lease is currently shutin, awaiting a cement squeeze to shut off a channel in the cement and the Clayton Lease, (#1 Miller) continues to produce about 12 BOPD, KFG has a 4% working interest at Clayton increasing to 18% at payout. .


By mrduediligence

Posted: Tuesday Oct 28 3:59:57AM 2014

    As of 11:59pm ET October 27th, 2014

Date        Insider Name                Ownership

Type                Securities              Nature of transaction                # or value acquired or disposed of                Price

Oct 27/14                Oct 27/14       Haney, Kevin     Direct Ownership                Common Shares    10 - Acquisition in the public market                55,000                $0.130

Oct 27/14                Oct 27/14       Haney, Kevin     Direct Ownership                Common Shares    10 - Acquisition in the public market                80,000                $0.120

Oct 25/14                Oct 24/14       Haney, Kevin     Direct Ownership                Common Shares    10 - Acquisition in the public market                50,000                $0.090

Oct 23/14                Oct 21/14       Haney, Kevin     Direct Ownership                Common Shares    10 - Acquisition in the public market                40,000                $0.085

Oct 23/14                Oct 14/14       Haney, Kevin     Direct Ownership                Common Shares    00 - Opening Balance-Initial SEDI Report    5,100,000                

 

from www.canadianinsider.com


By mrduediligence

Posted: Monday Oct 27 4:19:27PM 2014

A great summary from Pinnacle Digest came out after the close today on KFG. I think this will attract some new buyers

and watchers tomorrow as this company bucks the trend of the falling oil stocks. The best juniors are the ones that can

make money when everyone else is losing money. It didn't specify, but last year KFG made $120,000 half half of the 

revenue and $76 price per barrel.

 

http://www.pinnacledigest.com/

 

http://www.pinnacledigest.com/blog/pinnacle-digest/kfg-resources-jumps-50-monday

 

Best part at the bottom of the article:

 

This is all relevant, because on Monday, KFG was among the most liquid stocks on the TSX Venture. In a tumultuous environment for even the most balanced and successful oil and gas companies, KFG has found a way to climb within striking distance of its 52-week high. 

Investors will need to see continued production increases and exploration upside if its market cap is to rise.

KFG Resources is representative of a junior resource stock that can still catch a bid because it has revenue and low costs. When a company earns in for a limited percentage of ownership of any given well, it mitigates its risk hugely; if the companies involved should miss on the well, they move to the next opportunity.

A junior oil and gas company can earn 10% on 10 different wells, providing it ten times the opportunity of hitting on any single well vs. being the operator and earning 100% on a single well. This is not a new strategy, but one being utilized more and more often in the junior resource sector.


By mrduediligence

Posted: Sunday Oct 26 9:08:52AM 2014

Sorry everyone, not sure why these posts don't copy/paste properly. Always a large gap at the top.


By mrduediligence

Posted: Sunday Oct 26 9:08:09AM 2014

Additional insider buying as per Canadian Insider:

 

 

 

Filing
Date

Transaction
Date

Insider Name

Ownership
Type

Securities

Nature of transaction

# or value acquired or disposed of

Price

Oct 25/14

Oct 24/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

50,000

$0.090

Oct 23/14

Oct 21/14

Haney, Kevin

Direct Ownership

Common Shares

10 - Acquisition in the public market

40,000

$0.085

Oct 23/14

Oct 14/14

Haney, Kevin

Direct Ownership

Common Shares

00 - Opening Balance-Initial SEDI Report

5,100,000

 

 

https://www.canadianinsider.com/node/7?menu_tickersearch=KFG+%7C+KFG+Resources


By mrduediligence

Posted: Wednesday Oct 22 4:24:57AM 2014

Progress made by KFG between August 2013 and October 2014:

August 2013 - KFG Exited 2013 with a small profit, but lost 25% of Fayette's production due to payouts.

September 2013 - KFG earned $116,000 on just $500,000 in revenue at $76 per barrel price for LLS

November 2013 - Craig 1 put into production

December 2013 - KFG earned $126,000 on $758,000 revenue

February-March - Craig 2 and Parker 2,3,4 start drilling phase and put into production

April 2014 - KFG lost $300k due to accrued income, increased costs from hiring new employees, buying new equipment and additional costs from all the new wells.

June 2014 - Four wells paid out, turning 10% interests into 20% interests, increasing KFG's production by 35-40bopd. Craig 3 and Barnum 2 started drilling

July 2014 - Craig 3 put into production. New Reservoir was found

August 2014 - KFG has net profit of $67,500 for 2013 after 4 quarters(ended April 30th)

- Total revenue at $2,659,768. Says in MD&A that all lost production was recovered and even more from a year ago.

September 2014 - Barnum well put into production at 40bopd, but 2 weeks later production increased to 140bopd.

- Fall drill program announced, 3-4 wells to complete before end of December

October - KFG earned $461,000 on $900,000 revenue. Investor acquires a 10% stake in KFG.

The October results only include 22 wells of the 24 currently production, so in Q2 which will come out in December(ending October 31) we will see additional revenue from the following:

- Craig 3 well

- Barnum well

- Full quarter of the 4 wells that paid out in June

By mrduediligence

Posted: Monday Oct 20 6:24:28PM 2014

Nice news release today, less shares available on the open market:

 

 

Symbol C : KFG
Shares Issued 50,584,144
Close 2014-10-15 C$ 0.085
Recent Sedar Documents

KFG investor Haney acquires 5.1 million shares

2014-10-20 07:41 MT - News Release

 

Mr. Robert Kadane reports

KEVIN HANEY ACQUIRES 10% VOTING INTEREST IN KFG RESOURCES LTD

Kevin Haney of Dauphin, Man., has acquired 5.1 million common shares of KFG Resources Ltd., effective Oct. 16, 2014. Total shares held directly and indirectly amount to 5.1 million voting units, representing a 10-per-cent interest. These shares were purchased for investment purposes. Mr. Haney may purchase additional shares in the market or, alternatively, sell some or all of his holdings, depending on market conditions. It is not the intention of Mr. Haney to influence control or direction over the management of the company.

For further information, contact Mr. Haney at 204-648-4383.

© 2014 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Saturday Oct 11 8:40:29AM 2014

Looked at two main Mississippi oil sites today and saw that KFG's Craig 4 well and Seale(Franklin wild cat) are licensed and ready to drill whenever the company is ready.

http://gis.ogb.state.ms.us/MSOGBOnline/

The second thing was trying to see how well KFG is performing compared to it's peer in Mississippi and Louisiana.  But DrillingEdge is only upto date until June. Also keep in mind that this is total combined production of KFG and it's partners, which doesn't include Craig 3 or Barnum.

http://www.drillingedge.com/mississippi

Breakdown of areas and where KFG ranks in terms of production as of June.

Jefferson County -->  KFG was the main producer in this county

http://www.drillingedge.com/mississippi/jefferson-county

Adams County --> KFG was the second main producer in this county

http://www.drillingedge.com/mississippi/adams-county

Lincoln County---> KFG was the second main producer in this county

http://www.drillingedge.com/mississippi/lincoln-county

Warrn County--->KFG isn't very active here, only one small well in this county

http://www.drillingedge.com/mississippi/warren-county

Grand total for Mississippi is 18 wells in production with 12,185 barrels produced.

12,185(barrels) / 30(days) = 406bopd.

http://www.drillingedge.com/mississippi/operators/kfg-petroleum-corporation/31500

Then the company has a few wells in Louisiana. For whatever reason though, I can't find the breakdown of where these are on this website.

http://www.drillingedge.com/louisiana/operators/kfg-petroleum-corporation/2944

Shows 3 wells with a total production of 732bopd. KFG showed 22 in the Q1 results because it included Dale, which was shutdown in this quarter as mentioned in the MD&A. Now Dale is back up and Craig 3 and Barnum 2 are producing, so total count will be 24 wells for Q2 2014. 732(barrels) / 30(days) = 24bopd


Now there are some investors wondering what will happen with the recent drop in oil prices. Well KFG is covered. One of the few articles I was able to find about Louisiana Light Sweet crude, but it has upto date recent pricing which is important since KFG sells it's oil at these prices. Like I mentioned in previous posts, my estimated average selling price for KFG in Q2 will be around $95. LLS has been trading closer to brent prices over the last couple months rather than WTI. One of KFG's many advantages in this tough oil market. Just this week the price hit a low of $90.58, so KFG is still getting $90 a barrel and with $30 cost per barrel, very profitable still. Unlike Western Canadian select, it hit a low of $74.46.

http://www.petroleumnews.com/pntruncate/501597498.shtml

At the bottom of this article

Louisiana Light Sweet, a Gulf Coast benchmark which has recently been trading near par with Brent, settled at $96.29 on Oct. 2, but by Oct. 8 it had fallen nearly $6 settling at $90.58 according to CME Group information provided by Argus. Western Canadian Select, another North American benchmark, settled at $77.86 on Oct. 2, but by Oct. 8 it too had fallen settling at $74.46.

 


By mrduediligence

Posted: Wednesday Oct 1 3:21:14PM 2014

KFG's operating profit at $460,581 in Q1 2015

2014-10-01 12:27 MT - News Release

 

Mr. Robert Kadane reports

KFG REPORTS OPERATING PROFIT FOR FISCAL 1ST QUARTER ENDING JULY 31, 2014

KFG Resources Ltd.'s wholly owned subsidiary, KFG Petroleum Corp. of Natchez, Miss., had net income of $460,581 for the company's fiscal first quarter ending July 31, 2014, compared with $113,525 in the corresponding quarter in 2013. Gross revenue for the quarter was $904,409, as compared with $582,176 in the fiscal first quarter of 2013. The company had cash on hand of $1,133,429 and a current ratio of 2.1 to 1. There was no long-term debt.

Adams county, Mississippi

Operationally, the company's Barnum No. 2 well in the Mantua field reported initial production of 40 barrels of oil per day in mid-September. After two weeks of production, the well is now producing 140 bopd from the original perforations at 6,398 feet in the Parker sand. The well has several potential zones behind pipe. Field development will begin in the first quarter of 2015 after extensive production testing. The company's working interest in the well is 9 per cent, jumping to 20.5 per cent at payout. Additionally, the Craig No. 4 well has been staked as a southwest offset to the Craig No. 3 well in the LaGrange field currently producing 50 bopd. The company's working interest in the Craig No. 4 is 10 per cent, jumping to 21.5 per cent at payout.

© 2014 Canjex Publishing Ltd. All rights reserved.


By mrduediligence

Posted: Tuesday Sep 30 5:11:54AM 2014

I initially put KFG into the 4 main plays thread, but now the company deserves it's own given the new stream of earnings and potential. 

 

KFG earns $461,100 or $0.01ceps in Q1. This is more than double the last 8 quarters of total earnings. 

 

KFG Resources Ltd. Financial and MD&A Highlights for Q1 2014 Ending July 31

 

(Expressed in US Dollars)

 

Price: $0.10

Shares Outstanding: 50,584,144 with no options or warrants

 

Cash: $1,133,429

Accounts Receivables: $1,032,148

Prepaid Expenses: $22,922

Reclamation Bond: $20,000

Property & Equipment: $1,432,033

Total Assets: $3,640,532

Total Liabilities: $1,042,248 (All payables)

 

Revenue

Oil and gas: $788,143

Management Fees $116,266

Total Revenue: $904,409

Total Expenses: $444,015

 

Net Income: $460,100

 

Basic and diluted income per common share: $0.01

Now we will move onto the MD&A. Keep in mind the following:

1) 4 main wells pid out mid Q1, so only half of that new revenue was added to this quarter

2) Craig 3 was put online end of Q1, no revenue from that

3) Barnum wasn't online until mid Q2

This is why the well count only shows 21. With Craig 3 and Barnum we are at 23. Not sure why it isn't 24, maybe one well was down this quarter. Either way, the above translates to a much bigger revenue/profit for Q2 and with several wells to go it will only increase. $0.04-0.05c eps for 2014 is very realistic at this point. Even at a lower range 10 times earnings price, KFG would be at $0.40-0.50c minimum by next fall. Doesn't include additional revenue and new discoveries either.

 

MD&A

 

Overall Performance

For the three months ended July 31, 2014, the Company had cash flow from oil and gas production of $788,143, compared to $519,526 for the three months ended July 31, 2013. Oil production decreased from 86.15 BOPD to 75.07 BOPD, and gas production decreased 3.86 MCF per day. The average price of gas increased $0.87 per MCF and the average price of crude oil decreased $11.43 per bbl when comparing the three months ended July 31, 2014 and July 31, 2013.

 

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 will be drilled in mid October 2014.

 

The Company reported net income of $460,100 for the three months ended July 31, 2014 compared to net income of $113,525 for the three months ended July 31, 2013, with the increase in net income a result of less operating expenses plus better prices for oil and new oil from the Craig and McNeil bases due to increased working interest in the wells.

 

The quarter ended July 31, 2014 reflected the production of the Craig #2 well as well as payout of the Craig #1 and #2 wells increasing KFG’s working interest from 10% to 21.5% and late in the quarter the MacNeil #1 and #2 paid out increasing the working interest in those wells from 8% to 20.5%.

 

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 2014 internally.

 


Canadian Small Caps

 
Canadian Small Caps

CLICK HERE to view the presentations from the Spring 2016 Small-Cap Conferences.

We are pleased to publish the PowerPoint presentations from The Small-Cap Conferences that were held in Calgary on March 30, 2016 and in Vancouver on May 3, 2016.

We encourage investors to review the presentations and contact the companies with any further questions.

www.smallcapconference.ca/presentations.php
plus

What's New