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Gold/Mining/Energy : BPI Industries Ltd (BPR-VSE)
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To: Wai Lam who wrote (60)10/15/1997 7:12:00 PM
From: VIP Condo   of 355
 
Received BPI Corporate Update Newsletter yesterday.
Highlights:
Illinois Basin CBM 67 Square mile (43,000 acres) project initial report suggested .8 to 1.8 TCF of methane but could be as high as 3 TCF. 250 miles from major gas markets and has two major gas pipelines running through it. The compnay is well financed and debt free.

Test Program Reservoir and valuation:
Halliburton Energy Services engaged to utilize their state of the art tech. Cawley, Gillespie & Assoc. doing reservoir analysis. They are a recognized co. in the CBM ind. for their ability in performin in-depth reservoir analysis and bankable feasibility studies.
To date 18 widely spaced wells drilled. 14 completed with production casing. Last and deepest well (9,000 ft.) is underway to enhance knowledge of geology and values of methane reserves.
Upon completion of analysis, BPI will have instruments to acquire funds to place project into full swing (estimated at 525 wells), making BPI a significant gas producer in U.S.

OIL Prospects:
Amosoil, Inc. is wholly owned sub and has the oil leases in southern Illinois.
JV partner Ceja Corp.(private) completed 3-D seismic on 2842 acre prospect to target drilling - expected to begin early 10/97. Ceja currently has 10 producing oil wells on adjacent area.
200 acre prospect - Clark 1A completed 9/97. Awaiting prod. #'s but expected at 100-175 BOPD consistent with adjacent wells. 4 more could be drilled.

UPSTREAM NEWS: 10/3/97 (highlites)
Independent reservoir analysis scheduled for 11/97 to tell them whether their assumptions of 1.8 to 3 TCF are reasonable numbers.
Data gathered so far exceeds companies expectations. MCM & BPI looking for partners if pilot test results are as expected.
10 test wells in 1996 turned average coal strata at 14 m with bottomhole res. pressure of 150psi. To date partners only have released one well test data - Sittig 1. this produced 318,000 cubic feet per day of CBM. 50% more than anticipated flow rate.
Quote "This is big time" as a trillion cubic feet of gas is worth $2.5 Billion. A very significant number even though BPI only has 49%.

On the side - SALINE County site (Illinois Basin) that CBM Reserves could be as high as 595 Billion cubic metres a volume slated by the Dept. of Energy in 1980's. US Geological survey estimate as little as 23.8 Billion cubic metres.

Based on the energy source of the future being CBM - I think I will stick with BPR.V for awhile as I have been told that this stock could rock the $10 range by Dec/97 and long range predictions are $200US if this CBM site takes off as it will make BPI one of the major suppliers of Gas in the US.

Any body out there - come back.
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