Black Dragon will now earn up to 25% of the first phase of the Humble Project by completing the first phase of the project which includes the drilling of the fifth well. Black Dragon intends to have the drilling rig onsite this week and have the 5th well completed within the next couple of weeks.
All 5 wells should be pumping within two weeks at which time the company intends to begin the EOR phase of the project. This phase of the project is projected to increase oil flow to 200-300 barrels of oil per day, dramatically increasing cash flow from the project.
Black Dragon also has a Verbal agreement with one of the property owners to buy up to an additional overriding 7 1/2% royalty. On 200 barrels of oil per day, this additional royalty interest could add an additional $53,000 per month to the bottom line. If the Humble project can produce 2/3rds of the projected barrels of oil per day, this would add an estimated $465,000.00 a quarter to Dragon. That figure does not include the addition of Phase 2 and 3 which will add 10 more pumping wells bringing the total well count to 15.
Black Dragon also has a verbal commitment with one of the mineral owners to purchase a second 10 acres on the Humble Dome in which Black Dragon will have a 100% interest.
The Humble Project Engineer has done a reevaluation of the resources on the Humble Dome and has now increased the estimated reserves to be greater than 1.5 million barrels of recoverable oil in place.
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