Dynamix Corp (DYX was Dakota Resources, DAK) Message Board

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Gold/Mining/Energy : Dynamix Corp (DYX was Dakota Resources, DAK)

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To: Laser who wrote (491)	7/14/1998 12:12:00 PM
From: Donald F. DeKold	Read Replies (1) of 587

Carson Associates has not yet begun drilling the Greasy Creek Prospect yet due to the fact that only 3 of the 5 title searches have been completed for the sites of the five wells. However, with three in hand they expect to go ahead with drilling before month's end. The target for the five holes is the shallow Devonian shale gas zone that is about 2500 feet down. It takes only 3 to 5 days to drill one well. The probability of bringing in an economic well is about 95% in this part of Eastern Kentucky. Expected production rates can range from 60 MCF to twice or more that amount. The price of natural gas per MCF is about US$2.50, so if Dynamix brings in five producers at the low end of the production range, the income (from their 25% interest) to the corporate treasury will be about US$300 per day or US$115,000 (C$170,000) per year. A favorable factor in the earnings potential is that a large pipe line runs through the field meaning a direct hook-up to this line is possible which eliminates royalty payments to other companies for the use of their pipelines. A significant fact relevant to the natural gas wells in this region is the long pay period. Once a well is completed, it can be a producer for over 50 years. One well in downtown Ashland, KY drilled in 1928 had to be plugged recently due to the corrosion in the casing that takes place over time. It produced steadily over six plus decades. The Greasy Creek is a large undeveloped tract and there is the potential for Dynamix to acquire rights to drill more wells. My opinion based on the facts I have learned is that Dynamix has taken a very conservative approach by opting to drill high probability, low yield wells. They can use earnings, which may begin as early as six weeks hence to expand their natural gas operation. Let's all wish DYX good fortune in their new endeavor. I am pleased with this conservative course in a time when speculative ventures are in deep disfavor. This information was obtained independent of management and may not be totally accurate in details. It is based on a conversation with someone believed to be a reliable source, and was composed after the conversation. Best, Don

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