AZRH fantastic update, this is exactly what us stock holders are looking for, facts facts facts, long and strong here adding to my position as funds permit: Merger agreement executed today. Will be uploaded to the otc shortly. Press release will go out no later than Monday, most likely Friday. Second press release will be announced a few days after announcing the designation of the Companies Chief Production Engineer (bringing a killer track record to the team of exits while working to optimize the production of some serious major operators).
The merger will bring 404 old oil wells, across 18,300 acres in the Permian Basin and 5,000 acres across South Texas (target production 300-450 barrels per day after Cohen and Watson invest $1.1M in CAPEX of their own personal money & with using Cohen and Watson's service company knowledge and relationships / combined with the production cash flow once the wells are turned back online - no outside equity is planned at this time).
The group intends to start CAPEX remediation plans by the 3rd week of June, starting with the electric bills, and then going into workovers where the group will target the wells that need new pumps / pumps cleaned and worked over + acid and chemical treatments AND / OR Rod and tubing replacements as applicable (but do not anticipate too much tubing repair at this time). Once this phase is complete, the group will target the well candidates that do require tubing, new cement jobs, and packets (more than expensive workovers). The next phase will be to evaluate and pursue 34 horizontal re-entries (this means using the vertical infrastructure already in place, but drilling sideways into the pay zone to further extend the well vs drilling more verticals side by side).
To correct that there are only 4 new permits - as also acknowledged by the smartest guy in the room - there are 30 permits filed for this phase - note that a horizontal well re-entry AFE will be better estimated closer to when the company is ready to pursue this - however, these wells can cost upwards of $600 - $800k. There are already 6 horizontals that have been drilled in the past, with production rates close to 35-60 barrels a day.
Another Note - based off of the EUR (estimated which is a geoglogical calculation based on Original In Place Oil, and evaluated historical Drainage, Thickness, Porosity, Water Saturation, Oil Formation Volume Factor, and Recovery Factor) the company based on the Geologists calculation estimates that there could be up to 3,238,051 total barrels left to recover on the existing vertical infrastructure already in place, and that there could be up to 12,929,016 total barrels to be recovered from the horizontal line efforts). The Gross Cash Flow of this would result in $970 Million in total recoverable oil sales over the life of the wells (assume 20-40 years).
This number is required to be validated by a third party engineer before it can be recorded on the balance sheet, and is also subject to a PV10-PV20 discount factor - to put in Lehman terms, the discounted cash flow value of this reserve value would most likely pencil out around $150-200M for just PDP and PDNP (no PUD).
Cohens a betting man that if that number is 30% of the above figures - that this is enough to position this company to fall inline with a growth strategy and story similar to Mountain V Oil & Gas or Sabinal (renowned later life focused independent E&P Operators).
More to come as this the operations further develop. Josh Watson is heading out to Cochran County tomorrow with his consultant to tighten up the workover plan of attack, once the company has paid the $68k electric bill.
For everybody asking why Cohens been so quiet lately - it's because he's been heads down working on closing deals like the above for all of his retail investors and his stakeholders.
He is equally frustrated about the Shell letter, and the Secretary of State lawyers ridiculousness mistake in filing a termination of the Freedom Well Testing LLC mistakenly assuming that the company was to be merged into Azure Holding vs what was spelled out in the merger agreement as a 100% assignment of the equity of Freedom Well Testing to Azure, and he is working to remediate and understand everybody's frustration as he is equally frustrated paying a lawyer to f$ck up something simple like this. Attached his text with the lawyer just so you can see for transparency. https://x.com/americanmade_ai/status/1930376069917360367
The merger will bring 404 old oil wells, across 18,300 acres in the Permian Basin and 5,000 acres across South Texas (target production 300-450 barrels per day after Cohen and Watson invest $1.1M in CAPEX of their own personal money & with using Cohen and Watson's service company knowledge and relationships / combined with the production cash flow once the wells are turned back online - no outside equity is planned at this time).
The group intends to start CAPEX remediation plans by the 3rd week of June, starting with the electric bills, and then going into workovers where the group will target the wells that need new pumps / pumps cleaned and worked over + acid and chemical treatments AND / OR Rod and tubing replacements as applicable (but do not anticipate too much tubing repair at this time). Once this phase is complete, the group will target the well candidates that do require tubing, new cement jobs, and packets (more than expensive workovers). The next phase will be to evaluate and pursue 34 horizontal re-entries (this means using the vertical infrastructure already in place, but drilling sideways into the pay zone to further extend the well vs drilling more verticals side by side).
To correct that there are only 4 new permits - as also acknowledged by the smartest guy in the room - there are 30 permits filed for this phase - note that a horizontal well re-entry AFE will be better estimated closer to when the company is ready to pursue this - however, these wells can cost upwards of $600 - $800k. There are already 6 horizontals that have been drilled in the past, with production rates close to 35-60 barrels a day.
Another Note - based off of the EUR (estimated which is a geoglogical calculation based on Original In Place Oil, and evaluated historical Drainage, Thickness, Porosity, Water Saturation, Oil Formation Volume Factor, and Recovery Factor) the company based on the Geologists calculation estimates that there could be up to 3,238,051 total barrels left to recover on the existing vertical infrastructure already in place, and that there could be up to 12,929,016 total barrels to be recovered from the horizontal line efforts). The Gross Cash Flow of this would result in $970 Million in total recoverable oil sales over the life of the wells (assume 20-40 years).
This number is required to be validated by a third party engineer before it can be recorded on the balance sheet, and is also subject to a PV10-PV20 discount factor - to put in Lehman terms, the discounted cash flow value of this reserve value would most likely pencil out around $150-200M for just PDP and PDNP (no PUD).
Cohens a betting man that if that number is 30% of the above figures - that this is enough to position this company to fall inline with a growth strategy and story similar to Mountain V Oil & Gas or Sabinal (renowned later life focused independent E&P Operators).
More to come as this the operations further develop. Josh Watson is heading out to Cochran County tomorrow with his consultant to tighten up the workover plan of attack, once the company has paid the $68k electric bill.
For everybody asking why Cohens been so quiet lately - it's because he's been heads down working on closing deals like the above for all of his retail investors and his stakeholders.
He is equally frustrated about the Shell letter, and the Secretary of State lawyers ridiculousness mistake in filing a termination of the Freedom Well Testing LLC mistakenly assuming that the company was to be merged into Azure Holding vs what was spelled out in the merger agreement as a 100% assignment of the equity of Freedom Well Testing to Azure, and he is working to remediate and understand everybody's frustration as he is equally frustrated paying a lawyer to f$ck up something simple like this. Attached his text with the lawyer just so you can see for transparency. https://x.com/americanmade_ai/status/1930376069917360367
