DENVER, COLORADO (TSX VENTURE: WHD)(FRANKFURT: H5N) (the
"Company") is pleased to provide a progress report on recent
activities and future plans from Dr. Wm. Mark Hart, President and
Chief Executive Officer:
"Before discussing 2007 results and plans for 2008, I'd like to
comment on the Company's vision. West Hawk's management team is
focused on building and growing a clean energy gasification company
that utilizes state-of-the-art technology advancements in
gasification, cooling, cleaning, and output product systems, and
incorporates the latest engineering design concepts in emission
controls. The Company believes that clean energy products can be
profitably produced from coal and other feed stocks, and West Hawk
is positioning itself to drive and implement this vision in
2008.
As a dynamic and emerging energy company, we have placed
emphasis on assembling a team of individuals capable of executing
our plan to build tangible asset value through strategic
acquisitions, partnerships, and projects. In keeping with this
strategy, we have acquired a number of truly exciting projects. In
Canada, we hold coal licenses to three coal properties. Please
refer to the NI 43-101 Reports at www.sedar.com for resource
estimates. In the United States, we have acquired drilling rights
in the most prolific natural gas field, the Piceance Basin, with
vast estimated resources in place. In addition, our Company
continues to negotiate potential synergies to utilize our coal
assets and our technical expertise, for projects in the US, Canada,
and China. We believe these prospects will provide the foundation
for accelerating coal gasification growth, advancement of the
Company's value, and provide the economies of the world with clean
forms of fossil fuels well into the future.
Each of these projects will mature over the next few years, and
they all require an intense amount of upfront effort to generate
growth in cash flow. Stakeholders in the Company must understand
the value building philosophy, as successful growth requires time
and a sustained dedicated effort. Our team is dedicated to this
effort.
2007 Results
During 2007, our primary areas of focus were on the initial
drilling of the Figure Four natural gas property in Colorado,
completing and filing the required NI 43-101 technical reports for
our Canadian coal properties, and developing long term
relationships with future West Hawk partners in the gasification
business. This was accomplished by securing two coal gasification
contracts with our major Chinese partner Lu'An, and by identifying
the technology partner that the Company intends to utilize for
gasification, the New York Energy Group. As a result of near-term
business opportunities for the technology to be developed in the
United States, we evaluated three USA coal properties, two of which
are still under evaluation for future development.
At the Figure Four Project, West Hawk completed the drilling
requirements of the Drilling and Development Agreement (DDA) by
drilling 4 deep wells to depths of approximately 10,000 to 11,000
feet. Wells 1 and 2 are in production and generating cash flow from
a production zone that the Company was required to test under the
DDA. However, the Company plans to conduct further completion work
in the upper production zones of these wells in order to increase
production. When this work is completed, the Company believes that
the wells will produce at the commercial quantities that were
originally expected, and generate significantly more cash flow.
Wells 3 and 4 have been fractured in the upper production zones,
and are in the completion phase. We are performing final completion
work on Well 3 and expect to bring it into commercial production in
the very near term. Completion work on Well 4 will start
immediately after Well 3 is in production. Well 4 is not expected
to be in commercial production for several more weeks, and will be
dependent upon how quickly the completion fluids are recovered
during the flow back process.
The results in 2007 were significantly impacted by drilling
during winter weather conditions, operational problems caused by an
inexperienced contract drilling crew, weight restrictions that were
imposed on the County Road during the Spring, which delayed the
mobilization of completion equipment needed for wells 1 and 2, and
third-party delays in completing the pipeline connections on the
Rockies Express, which resulted in extremely low natural gas prices
due to pipeline overcapacity. Also during 2007, the Company
received excellent marks from an independent 3rd party who
conducted a complete environmental report and safety inspection on
the Figure Four property.
Plans for 2008
The Company's plans for 2008 are focused on three primary
fronts: the Figure Four Project, a coal gasification project, and
development of the Canadian coal properties.
Figure Four
Although the Company encountered difficulties on the Figure Four
Project in 2007, we continue to persevere, and expect much better
results in 2008. The Rockies Express Pipeline is now in commercial
operation through Kansas and prices for natural gas from the
Piceance Basin have doubled. The future price forecast projects gas
prices to be over $6.50 per MCF throughout 2008.
The Company's objective in acquiring the rights to drill the
5,000 acre Figure Four property in late-2006 was to generate a
source of cash flow in order to drive coal gasification projects
forward. The capital investment required to drill additional wells
on the property and generate the cash flow that is required for
gasification projects, has been very difficult to obtain from
financing institutions. Although the property area covered under
the DDA is adjacent to other wells in production, the property is
considered by financial institutions to be in a new production
area. The Company will need to have the existing four wells in
production for several months to demonstrate production quantities
and minimize the investment risk, before additional financing is
obtained from lending institutions. Although additional capital
investment in the project is expected to decline as cash flow from
future well production is reinvested, in the near term, the Company
must continue to raise capital in the equity market or attract
additional investors in the project, in order to meet existing
obligations, and fund future drilling requirements.
Coal Gasification
West Hawk has partnered with the New York Energy Group (NYEG)
because we believe that both companies share a common vision as a
clean energy company. West Hawk has evaluated coal/biomass/waste
gasification technologies and decided to develop gasification
projects with a technology partner that is ready to build a plant
that incorporates advancements in traditional coal gasification,
and to demonstrate that coal can be converted into clean energy
products on a commercial scale. West Hawk's Management believes
that the NYEG technology is more efficient and cleaner than other
competing technologies. As a result, West Hawk has signed a Letter
of Intent with NYEG to acquire a partial interest in NYEG's first
gasification plant site. West Hawk will announce details regarding
this project in the near future. The synergistic relationship
between West Hawk and NYEG will open many doors and opportunities
for both companies to demonstrate the economic viability of this
technology. Coal and biomass gasification represents the future of
the Company, and in Management's view, can help meet the world's
future demand for clean energy products for the next several
decades. Management's view is based on the abundance of the world's
coal resources, which are generally believed to be 26 times more
than oil and gas resources, the strategic location of coal
resources around the world on all continents, and the belief that
coal is the lowest cost feed stock for gasification. New
gasification technology allows coal the ability to meet all KYOTO
Protocol current and future clean air emission requirements. Coal,
biomass, and waste feedstock can also be blended together in the
gasification process to produce clean energy commercial products to
help the world solve environmental issues including global warming,
and enhance the standard of living for all people.
Canadian Coal Properties
Among the coal properties that have been secured by West Hawk, a
priority has been placed on the development of the Groundhog
property, located in British Columbia. The Groundhog property is
believed to be one of the last undeveloped world-class coal
deposits of anthracite/metallurgical coal, the highest quality coal
available. The Company is currently working on an updated property
development plan that it intends to implement in 2008. Details on
progress, including a financing plan, will be announced in the near
future.
The development of West Hawk's coal assets in the Northwest
Territories of Canada, near Tulita, remains an important objective,
and has received international attention. The property is located
adjacent to the proposed multi-billion dollar Mackenzie Valley
Pipeline, which is being spearheaded by Imperial Oil. West Hawk's
objective for the property is to develop a mine for the coal feed
stock and construct one of the world's largest coal-to-gas
processing facilities. The coal was tested by SASOL / LURGI of
South Africa, and is suitable for gasification.
Please refer to the NI 43-101 reports at www.sedar.com for more
information on the Company's Canadian coal properties.
I thank you for your patience as the Company continues to grow,
and look forward to serving your interests in the future. Before
closing, I would like to briefly summarize the background and
experience of our management team and supporting staff that are
driving the Company's clean energy vision going forward."
Roger A. Baer, Chief Financial Officer
Mr. Baer has over 25 years of financial experience in the
minerals and natural resource industries. He is a Certified
Management Accountant and has held senior positions with Newmont
Mining, Cyprus Amax Minerals, Kennecott Energy and Amoco Pipeline
Co. Mr. Baer's education includes an accounting degree from
Illinois State University and an MBA from the University of
Phoenix.
Dr. Jinsheng Chen, President and CEO of Asian Operations
Dr. Chen was born and raised in China. After completing his
engineering degree, he moved to the United States where he
completed an MS and PhD in Mining Engineering. He has over 25 years
of experience in coal mining and the energy business. Dr. Chen has
held senior positions with Foundation Coal Company, RAG American
Coal, Cyprus Amax Minerals, and Asian American Coal Company. Dr.
Chen's education includes mining engineering degrees from the
Jiaozuo Mining Institute in China and West Virginia University, and
a Ph.D. in mineral engineering from West Virginia University.
Gonzalo Torres Macchiavello, President and CEO of North American
Operations
Mr. Torres Macchiavello has over 20 years of experience in the
energy and construction business. He has held senior positions with
NRG Energy, AES Corporation, Pennsylvania Power & Light,
Vattenfall Sweden, SARCOAL Energy, and EMSA Construction Company in
Brazil. He also has served as a board member of different energy
companies. Mr. Torres Macchiavello's education includes degrees in
business administration and public administration from the
University of Brasilia (UnB) in Brazil, and an MBA from the Getulio
Vargas University in Sao Paulo, Brazil.
Gary Wilson, General Manager of Canadian Operations
Mr. Wilson has over 35 years of experience in the energy
industry. Mr. Wilson has held senior positions in operations and
executive management roles within B.C. Hydro, Canada. Mr. Wilson's
education includes a degree in accounting and finance.
Andrew Lee, Manager, Corporate Communications
Mr. Lee has over 15 years of experience in the communication
field in various segments of the world from North America
throughout Asia. Andrew is a main point of contact for West Hawk
shareholders throughout the world. He completed his undergraduate
degree from the University of British Columbia.
Chuck Rogers, Field Manager, Colorado Gas Project
Mr. Rogers has over 10 years of experience in natural gas
drilling and completion activities. Mr. Rogers has worked for
Schlumberger and several other oil field service companies. He
served in the United States Military, and has a degree from Central
Texas College.
Aaron J. Goss, Assistant to North American President
Mr. Goss has over 7 years of experience. Aaron has worked at the
Figure Four site, and has provided support on the Company's coal
gasification projects. He is currently completing his
education.
Dr. Wm. Mark Hart, President and CEO, West Hawk Development
Dr. Hart has over 34 years of experience in the mining and
energy business. He has held senior positions with Newmont Mining,
NRG Energy, Cyprus Amax Minerals, AEP - American Electric Power,
and CONSOL Energy. He also worked as an electrician and repairman
for 7 years. Dr. Hart's education includes a PhD in mining
engineering from the Colorado School of Mines, MS in Engineering in
Mines from West Virginia University and an MBA. He has
undergraduate degrees in Mechanical Engineering Technology and
Mining Engineering Technology, and an AS in Electrical Engineering
Technology from Fairmont State University.
Richard F. Braun, Director
Mr. Braun is an independent director, and has over 40 years of
experience in the oil and gas, and chemical process industries. He
has held mid-level and executive positions with FMC Corporation,
International Energy Funds GmbH, and Fuel Resources Development
Corporation. Mr. Braun's education includes graduate work on an MBA
at the University of Oregon and a degree in mechanical engineering
from Stanford University.
On behalf of the Board of Directors,
Dr. Wm. Mark Hart, President and Chief Executive Officer
About the Company: West Hawk Development Corp is focused on
providing valuable, high-demand clean energy products from a
variety of sources. Assets include the Figure Four natural gas
property located in the Piceance Basin, Colorado, being developed
under a drilling and development agreement; the Groundhog coal
property located in northwest British Columbia; the Tulita coal
property in the Northwest Territories; and the Ellesmere Island,
Nunavut Territory coal property.
Cautionary Note: This news release contains forward looking
statements, particularly those regarding cash flow, capital
expenditures and investment plans. Resource estimates, unless
specially noted, are considered speculative. The Company has filed
a National Instrument 51-101 Report on the Figure Four property.
The Company has filed National Instrument 43-101 Reports for each
of the Groundhog coal property in British Columbia, the Tulita coal
property in the Northwest Territories, and the Nunavut coal
property. Any and all other resource or reserve estimates are
historical in nature, and should not be relied upon. By their
nature, forward looking statements involve risk and uncertainties
because they relate to events and depend on factors that will or
may occur in the future. Actual results may vary depending upon
exploration and development activities, industry production,
commodity demand and pricing, currency exchange rates, and, but not
limited to, general economic factors. Cautionary note to U.S.
investors: The U.S. Securities and Exchange Commission specifically
prohibits the use of certain terms, such as "reserves" unless such
figures are based upon actual production or formation tests and can
be shown to be economically and legally producible under existing
economic and operating conditions.
The TSX Venture Exchange has not yet reviewed and does not take
responsibility for the adequacy or accuracy of the content of this
news release.
Contacts: West Hawk Development Corp. Dr. Wm. Mark Hart
President and Chief Executive Officer (303) 357-4720 (303) 357-4726
(FAX) Website: www.westhawkdevelopment.com
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