Introduction
The Project

The West Taylor Oil & Gas Lease contains 338.5 acres and is situated in the heart of the Hrubetz (Ellen) Ellenburger Dolomite Field, 4 miles West of Novice, Coleman County, Texas. The Ellenburger Dolomite Formation underlying the prospect was created on a wide, shallow Ellenburger limestone shelf which was transformed into Dolomite. This transformation process is known as “dolomitization” and occurs when limestone (CaCO2) becomes dolomite (CaMg(CO2)2). Dolomite is generally observed to have more effective primary porosity than limestone. The “secondary porosity” increases due to dolomitization, the voids (known as vugs or vugular porosity created by percolating surface and subsurface waterborne carbonic acid and other organic acids, and the faulting and folding of the subsurface strata allows for significant accumulations of hydrocarbons within the dolomite. From a 2024 Geological Report of area well logs, it has been determined that the secondary porosity created by structural faulting and folding extends vertically as well as horizontally within the formation. The naturally occurring connection of vertical and horizontal fractures presents the opportunity for increased initial production rates and enhanced primary hydrocarbon recovery when the interconnection of fractures is properly stimulated with acid and hydraulic fracturing.

 

A prior operator of the lease drilled the West Taylor #112 & #117 well and proved
a large Ellenburger Dolomite reservoir trapped by a Northeast by Southwest oriente
Ellenburger structure situated beneath the prospect. The electric and mud log profile
of the #112 well indicates +/- 32 feet of fractured net pay zone. The well tested an
initial potential (IP) of 102 BOE (BOE = Barrel of Oil Equivalent = approximate energy
released by burning one barrel, or 42 US gallons, of crude oil; +/- 6,000 cubic feet (6
MCF of natural gas is equivalent to one BOE). Ellenburger Dolomite wells within close
proximity of the proposed drilling location have IPs ranging from 48 BOE to 211 BOE
(see satellite map on page #21).

Shortly after drilling and testing Well #112, the prior operator declared bankruptcy
and the lease was eventually acquired by the present operator, NOVCO Operating
Company. The lease is held by production from oil and gas wells producing from the
Gardner Sand, which is situated +/- 600' above the top of the Ellenburger Dolomite
Formation.

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