CHAIRMAN UPDATE
From: John W. Adair
To: ADAIR INTERNATIONAL OIL & GAS, INC. SHAREHOLDERS
Date: February 22, 2001
Subject: Chairman’s Update.
Dear Shareholders,
Pursuant to the subject of this letter, I respectfully submit to you the following information relating to the companies recent activities:
1. ADAIR Power, LLC. was recently formed and is a wholly owned subsidiary of ADAIR INTERNATIONAL OIL & GAS, INC. The 600 MW power plant project in Southern California continues to go forward and will be a very substantial project for the growth of our company. ADAIR also has 17 other sites under evaluation at this time and as previously announced PACE Energy Services has been engaged to assist ADAIR in the development of these sites. ADAIR continues to pursue additional business ventures in this area with other substantial companies.
2. ADAIR recently formed SUPERIOR Geophysical, LLC which is a wholly owned subsidiary of ADAIR INTERNATIONAL OIL & GAS, INC. This gives ADAIR the expertise to process 2-D and 3-D seismic as well as having more access to domestic drilling ventures that may arise. SUPERIOR is also planning a major 3-D seismic shoot in Texas with a number of partners identified at this time. The company will be in operation with all software and hardware in place by March 1, 2001. This company will compliment ADAIR Exploration our wholly owned subsidiary in Dallas whose area of focus is Yemen Block 20 and seismic interpretation. SUPERIOR with its seismic processing capabilities, and domestic seismic shoots will mutually compliment each company.
3. The co-generation/sugar refinery with ARKEL as a partner continues to progress in a positive manner and ARKEL should complete the feasibility study within 10 days of today.
YEMEN BLOCK 20 EXPLORATION
4. Adair Yemen Exploration Limited as Operator of the Block 20 project is underway with the 3D seismic program, which is the precursor to our drilling program. Our partner is OCCIDENTAL Petroleum (OXY.NYSE) in this venture. The Block 20 group has budgeted to acquire a minimum of 300 square kilometers (115 square miles) and Adair has awarded the seismic acquisition contract to WesternGeco, currently the largest geophysical contractor in the world. The mobilization of equipment is on schedule with portions of the crew coming from as far away as the former Soviet Union and South America. Initial surveying and line clearance work will begin within two weeks and recording is scheduled to begin in late March. Adair quality control staff is already on site to oversee this initial operation. ADAIR projects up to 340 million barrels of recoverable reserves in the Block.
Following completion of the 3D seismic fieldwork, additional work to process and interpret the data will be required before drilling locations can be determined. Current plans call for initial drilling to commence in November or December of this year.
In January, we named Mr. Carlos Proenca as the resident drilling manager for Adair Yemen. Mr. Proenca, who has extensive drilling experience in Yemen, is responsible for the engineering design and operational oversight for the drilling operations currently scheduled for the fourth quarter of 2001. Mr. Proenca is a twenty-year veteran of international drilling projects in Angola, Venezuela, Colombia, Gabon, Cameroon, Argentina, France as well as Yemen.
5. ADAIR continues to evaluate domestic cash producing oil and gas properties and it is our goal to make a number of substantial acquisitions this year.
6. A stock buy back program is in the plans for ADAIR and will be implemented at the appropriate time.
7. In conclusion, I expect 2001 to be a very good year for ADAIR and your loyalty is appreciated.
Respectfully,
John W. Adair
This letter contains forward looking statements within the meaning of Securities Litigation Reform Act that involves risk and uncertainties, including exploration, development, operational, marketing, and implementation risks, other facts described from time to time in the company’s public available SEC reports which could cause results to differ materiality. |
