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Turner Valley - the birthplace of Alberta's Oil and Gas Industry. On May 14, 1914 The Dingman discovery well blew in, changing the economic future for all generations to come.
Turner Valley Oil and Gas Inc. ("TVOG") is an independent oil and gas company with its activities currently focused in Canada. Currently TVOG holds a major equity interest in WIN Energy Corporation of Calgary, Alberta. As a result of these substantial holdings, TVOG is participating in the extensive exploration efforts of WIN Energy Inc. WIN's primary focus is Natural Gas Exploration with its core operations in the Foothills of Alberta, Canada.
Since TVOG commenced operations as an oil and gas company in August 2003, Turner Valley Oil and Gas Inc. has incorporated a wholly owned Canadian subsidiary, TV Oil and Gas Canada Limited (Federal Canadian Registry).
Our primary business objective is to create superior long-term value for our shareholders. We are accomplishing this commitment by making prudent investments in oil and gas companies and acquiring working interests in oil and gas plays both in Canada and the United States.
The nature of the oil and gas industry requires that management and the board remain diligent in assessing risk and insisting that the company's operators work in strict compliance with all prevailing legislation. Our Company has an extremely high bar in these regards.
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Our risk tolerance would best be described as conservative in nature. Although we recognize that oil and commodity pricing is reaching all time highs we standardly apply flat pricing at a discount to market, in our risk analysis. We will only participate in programs that are; extremely well researched, fit within our financial capacity and have undergone extensive independent reviews. If a problem should occur at any time in the life of the property, management has developed an exit strategy for each property that will allow us to cap our potential for loss. These exit stratagems are for internal use only.
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Amongst a significant number of developing opportunities, Turner Valley is focusing on the development of our working interest property in the Strachan Project. In September of 2005 Turner Valley entered into a farm-out agreement with Odin Capital and it is the full intention to of Turner Valley to assist and advise on bringing the Strachan Well into production. Our farm-out agreement is as follows:
In exchange for our paying 3.00% of all costs associated with drilling, testing and completing the test well (expected drilling cost - approx. $6.3 million Canadian to the 100% interest) on the property that is referred to as the Leduc Formation test well, we will have earned;
1.) In the spacing unit for the Earning Well, a 1.500% interest in the petroleum and natural gas below the base of the Mannville excluding natural gas in the Leduc formation, and a 3.00% interest in the natural gas in the Leduc formation before payout subject to payment of an Overriding Royalty which is convertible upon payout at the Royalty Owners option to 50% of our interest.
2.) A 1.200% interest in the rights below the base line of the Shunda formation in Section 10,Township 38, Range 9W5M.
3.) A 0.966% interest in the rights below the base of the Shunda formation in sections 15 & 16,Township 38,Range 9W5M, down to the base of the deepest formation penetrated.
Turner Valley Oil and Gas Inc. through its wholly owned subsidiary TV Oil and Gas Canada Ltd. acquired 1,300,303 common shares of WIN Energy Corp. (a private company) for the value of $1,418,768.00.WIN Energy is a closely held private company and therefore has no listing stock price or published market value, therefore, the Company valued its investment in WIN at the carrying cost of the oil and gas properties conveyed of $192,700. Subsequent to this transaction the Company sold 75,000 shares with a basis of $11,115 ($.1482 per share) and realized proceeds of $56,706 thus creating a gain of $45,591.During 2005, the Company sold 175,000 shares of its investment in WIN Energy to finance the acquisition of a working interest in the Strachan Property - Leduc Formation. The sale agreement includes a half warrant to enable the purchaser to purchase additional WIN shares at $1.75 per share until September 30, 2006.
TV Oil and Gas Canada Ltd. will assist and advise WIN Energy on all of its current drilling programs in Cowley, Todd Creek, and Pincher / Hillsprings. Also, TV Oil and Gas Canada Limited will monetize shares of WIN Energy from time to time in order to acquire oil and gas working interests that meet the parameters set out by the companies risk tolerance.
Alberta produces over 80% of Canada's natural gas. Statistics from the Canadian Association of Petroleum Producers have stated that reserves at 2003 fiscal year end showed 42.5 trillion cubic feet of natural gas. Production of natural gas in Alberta in 2004 was 13.2 billion cubic feet, exports were 8.5 billion cubic feet and consumption was 2.3 billion cubic feet. Canada has ranked # 1 as supplier of imported gas to the United States.
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