Invest In The Woodbine Formation

Billions of untapped US Oil from under produced wells in East Texas

The Woodbine Formation in Upshur County, East Texas, is home to huge oil reserves.

It is the primary productive geologic unit of the East Texas Oil Field, which has produced in excess of 5.42 billion barrels to date.

The East Texas Oil Field is ne of the largest oil reservoirs within the contiguous United States, which has gained it the nickname of ‘The Black Giant’.

History Of The Formation

The Woodbine Formation is a sandstone unit that was deposited one hundred million years ago, back when East Texas was an area of shallow sea.

Over time, it was uplifted, became eroded and was then covered by seawater again, depositing an impermeable chalk layer and creating a ‘petroleum reservoir’. This is a situation in which oil, which is considerably lighter than water, moves upwards until it gets to a point where it is unable to go any further.

Much of the trapped oil still remains there, waiting to be extracted.

Oil Reserves

According to the National Energy Technology Laboratory, the East Texas Oil Field is believed to have originally contained between 6.8 billion and 7.5 billion barrels of oil.

Records indicate that 5.2 billion barrels have been produced since it was first discovered, leaving between 1.6 and 2.3 billion barrels.

This is why the Woodbine Formation is one of the greatest opportunities in the Texas and American oil industry today.

Revitalizing Existing Wells

Our team will do the developmental vertical drilling and re-completions of existing wells that have been under managed and under produced in the Woodbine Formation.

We are revitalizing existing wells in proven productive fields that were abandoned due to low oil prices an insufficient technology.

This is significantly cheaper than building new wells from scratch.

Thousands of wells have been under produced, representing a major opportunity for re-completion or further development of proven undeveloped reserves through developmental drilling within the fields.

Partnership With Krog Partners, LLC

This venture allows us to take advantage of a portion of the one and a half billion barrels of oil that are yet to be recovered from the WoodBine Formation.

Lexstar Energy has partnered with Krog Partners, LLC, who have a background in finding value in oil fields that have been abandoned because of low oil prices.

We are therefore well equipped to seize this opportunity.

Experience In The Field

Krog Partners is a wholly owned subsidiary of Bandera Inc. who specializes in taking properties that have proven production and improving their values by bringing in a higher standard of operations and management.

This makes Krog Partners the perfect partner to have on board for revitalizing the abandoned wells in the Woodbine Formation.

Just as the properties have been proven to produce, Bandera Inc. has been proven to make the wells that it acquires substantially more profitable.

Helping The Wells To Reach Their Potential

Krog Partners are a valuable ally and add to our already extensive base of knowledge, further equipping us for the task of taking advantage of the wells in the Woodbine Formation and enabling them to attain their full potential.

It would be a shame not to capitalize upon these wells and maximize their ability to produce oil, which was what they were originally set up to do.

The wells are already in place; they just need somebody to run them.

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Example Intangible Drilling Cost Tax Deduction:

The intangible expenditures of drilling (labor, chemicals, mud, grease, etc.) are usually about (65 to 80%) of the cost of a well. These expenditures are considered “Intangible Drilling Cost (IDC)”, which is 100% deductible during the first year. For example, a $100,000 investment would yield up to $75,000 in tax deductions during the first year of the venture. These deductions are available in the year the money was invested, even if the well does not start drilling until March 31 of the year following the contribution of capital. (See Section 263 of the Tax Code.)

$100,000 (Investment) x 75% (IDC) = $75,000 x 35% (Tax Bracket) = $26,250 (Estimated Tax Savings)

*The above is only an if-then scenario. Not to be construed as Tax Advice.

The Woodbine Ridge Joint Venture presents a conservative opportunity to participate in a six well development project within a large proven reservoir, which to date has been under-produced. Estimated reserves in this project are 676,000 BO to 1,000,000 BO. To date, roughly only 40% – 60% of the oil in place has been produced. This recovery is well below what would normally be expected from a reservoir of this type. Since the reservoir is so prolific, it has always been difficult to invest in the East Texas Oil fields because nobody ever wanted to sell and major oil companies operated the wells. This now represents an attractive opportunity for the partners in this Joint Venture. The future may yield further development potential pending the success of this project.

We at Lexstar look forward to sharing with you the merits of adding the Woodbine Ridge Joint Venture to your Oil and Gas Investment Portfolio.