Biloxi Marsh Lands Corporation (PINK SHEETS:BLMC) announces
results for the year ending December 31, 2014 and provides update.
The Company’s annual revenue breakdown is as follows: 2014 revenue
from oil and gas production for its fee lands was $534,652 compared
to revenue of $636,189 in 2013.
Dividend and interest income for 2014 was $202,819, compared to
$164,275 for 2013. In 2014, the Company realized a cumulative gain
from the sale of investment securities of $1,717,041 compared to a
cumulative gain in the amount of $2,072,125 in 2013.
Meanwhile, for the year 2014, total revenues included a
$1,371,185 loss emanating from the Company’s investment in B&L
Exploration, LLC (B&L). This compares to a loss of $1,740,193
from B&L in the prior year. As an operating oil and gas entity,
B&L’s results included deductions for depreciation, depletion
and amortization (DD&A) costs relating to its ongoing drilling
and production activities. BLMC’s share of these DD&A expenses
was $992,684 and $927,415 for 2014 and 2013, respectively.
Total revenues for 2014 were $1,122,376 compared to $4,351,080
during 2013. 2013 revenues included a non-recurring gain under the
BP Deepwater Horizon Economic and Property Damages Settlement
Program in the amount of $3,189,681. Expenses for the year totaled
$945,848, slightly lower than the prior’s year’s expenses of
$1,091,414. For the year, the Company had net income of $202,411 or
$.08 per share compared to net income of $2,450,729 or $.90 per
share in 2013.
As of December 31, 2014, the combined gross daily production
rate from 8 wells operated by the Company's mineral lessees was
approximately 3.679 million cubic feet of natural gas (mmcfg) and
157 barrels of oil per day (BOPD) with net daily production
accruing to the Company of approximately .435 mmcfg and 3 BOPD. The
foregoing production includes four wells producing from S/L 16158
in which the Company owns a small interest. Meanwhile, as of
December 31, 2014, B&L’s gross daily production was
approximately 4.655 mmcfg and 336 barrels of oil from 7 wells with
1.685 mmcfg and 43 barrels of oil per day accruing to B&L.
The end of the year proved reserve study commissioned by the
Company and completed by T. J. Smith & Company, Inc., an
independent reservoir engineer, estimates that as of December 31,
2014 BLMC’s “Developed Producing” (PDP) reserves were .339 billion
cubic feet of natural gas (BCFG) and 2,800 barrels of oil.
In addition to the foregoing estimated proved reserves, another
reserve study completed by the same independent reservoir engineer
estimates that B&L’s proved reserves as of December 31, 2014
were approximately 9.4 BCFG and approximately 197 thousand barrels
of oil (MBBL) which compared to 9.0 BCFG and 215 MBBL as of
December 31, 2013. It should be noted that a significant component
of B&L’s proved reserves as of December 31, 2014 are Proved
Undeveloped (PUD). As is necessary with all PUD reserves, a well or
wells must be drilled and completed to fully develop these PUD
reserves. The foregoing reserves do not include any reserves
attributable to FM O&G’s Highlander Area Well in which B&L
is contractually entitled to a 1.5% ORRI.
The proved reserve studies referenced above include explanatory
notes that are an integral part of each study. A copy of the 2015
President’s Report to Shareholders that includes these notes will
be available on the Company’s website after March 27, 2015. The
Company recommends that all interested parties refer to its website
to view these notes and other relevant information:
www.biloximarshlandscorp.com.
Freeport-McMoRan Oil and Gas (FM O&G), a wholly owned
subsidiary of Freeport-McMoRan Copper and Gold Inc. (NSYE:FCX), in
its February 20, 2015 news release announced “the results of
additional production testing on Freeport-McMoRan Oil & Gas’s
(FM O&G) Highlander discovery, located onshore in South
Louisiana in the Inboard Lower Tertiary/Cretaceous trend. The
production test, which was performed in the Cretaceous/Tuscaloosa
section, utilized expanded testing equipment and indicated a flow
rate of approximately 75 million cubic feet of natural gas per day”
... “on a 42/64th choke with flowing tubing pressure of 10,300
pounds per square inch. FM O&G expects to immediately commence
production using FM O&G facilities in the immediate area. FM
O&G plans to install additional amine processing facilities to
accommodate the higher rates.
“As previously reported, the Highlander discovery well was
drilled to a total depth of approximately 29,400 feet in
first-quarter 2014. Wireline log and core data obtained from the
Wilcox and Cretaceous sand packages indicated favorable reservoir
characteristics with approximately 150 feet of net pay. In December
2014, FM O&G tested the well at a rate of approximately 43.5
MMcf/d on a 22/64th choke with flowing tubing pressure of 11,880
pounds per square inch. A second well has been identified and
future plans are being evaluated in this high potential area. FM
O&G has identified multiple prospects in the Highlander area
where it controls rights to more than 50,000 gross acres.”
B&L has been assigned and is contractually entitled to a
1.5% of 8/8ths overriding royalty interest (ORRI) in the Lomond
North/Highlander discovery well and in all mineral leases obtained
by FM O&G in its Highlander project area located in Iberia, St.
Martin, Assumption and Iberville Parishes, Louisiana.
B&L completed construction of production facilities and the
flowline for the Welder No. 1 well and placed the well on
production December 12, 2014. As of March 11, 2015, the Welder No.
1 well had gross production of approximately 1.56 mmcfg and 8 BOPD.
B&L has 100% working interest in the Welder No. 1 well. Due to
the decline in commodity prices during the fourth quarter of 2014,
B&L’s management is reevaluating each of its drilling projects.
B&L’s management believes that in the event of additional
discoveries in the Lago Verde project area each well should
continue to be economically viable due to the relatively shallow
target depths and lower costs of drilling. While commencement of
drilling may be delayed to allow B&L to take advantage of
declining drilling costs, B&L’s management anticipates that
additional prospects in the Lago Verde project area will be drilled
during 2015.
As previously reported, B&L assembled a mineral lease
position in Allen and Beauregard Parishes, Louisiana, targeting the
Wilcox sand interval which has been a historically prolific oil
producing interval in this area using conventional well completion
techniques. Based on technical information, B&L believes that
reservoir stimulation using hydraulic fracturing could result in
the discovery and production of significant oil reserves that were
not accessible in the past using conventional well completion
techniques. To assist in development of this Wilcox project,
B&L placed the majority of the working interest with Petro
Harvester Oil & Gas LLC, headquartered in Plano, Texas. Petro
Harvester has experience in drilling and stimulating Wilcox wells
in neighboring parishes. B&L retained a 15.75% working interest
in the Wilcox project. This project is currently being reevaluated
by B&L’s management in the context of the current lower oil
price environment.
As previously reported, the Company received a settlement
payment during 2013 for its wetlands real property claim under the
BP Deepwater Horizon Economic and Property Damages Settlement
Program. The Company has been advised by its legal counsel that an
additional limited recovery under the settlement may be expected,
but as of this time it is difficult to determine the timing and
amount of the additional settlement, if any.
In June 2014, the Company announced the completion of its
previously announced stock buyback program with the acquisition of
a total of 67,500 shares of its common stock since the inception of
the program in September 2008. During the course of completing the
buyback program, the opportunity to purchase additional shares of
common stock presented itself. The Company successfully negotiated
the purchase of an additional 151,900 shares in two separate
private transactions. Since September of 2008, the total number of
shares purchased by the Company as treasury stock is 219,400. The
Company paid an average price of $12.62 for these shares of common
stock since the inception of the buyback program. As of the time of
this press release, the Company is not actively seeking to
repurchase any additional shares of its common stock.
B&L was organized as a limited liability Company (LLC) under
the laws of Louisiana in July of 2006. B&L’s members are BLMC
and Lake Eugenie Land & Development, Inc. (LKEU), which have
membership percentages of 75% and 25%, respectively.
During its meeting held on December 11, 2014, the Board of
Directors declared a dividend of $.40 per outstanding share of
common stock payable on Tuesday, December 30, 2014 to shareholders
of record at the close of business on Monday, December 22, 2014.
This represents a total cash dividend payment of $1,014,011 or $.40
per share in 2014. Since 2002, the Company has paid approximately
$54,905,000 in total dividends. With the Company’s fee land based
production depleting and no new wells being drilled on its fee
lands, it will be difficult to maintain the level of dividends paid
since 2002.
Using 3D seismic data in its possession and other means, the
Company is constantly working on developing the minerals located
below its fee lands. One important step the Company has taken is
joining a consortium of oil companies which retained the University
of Texas Bureau of Economic Geology (BEG) to evaluate and quantify
chlorite coating on cores taken from the Woodbine and Tuscaloosa
sand intervals throughout south Texas and Louisiana, including the
ARCO - Biloxi Marsh Land P-2 well which was drilled on the
Company’s property and penetrated the Tuscaloosa sand interval. The
results of the BEG’s study indicate significant preserved porosity
and permeability in the P-2 well’s conventional cores due to
chlorite coating of the Tuscaloosa sand grains and the presence of
bitumen in the Tuscaloosa sand interval. This could prove to be
significant as the Company moves forward with its attempts to have
the conventional Tuscaloosa sand interval further tested and
developed beneath its fee lands. Meanwhile, the Company is focusing
on developing reserves outside of its fee acreage through its
investment in B&L. In its current stage of growth and continued
reinvestment in its drilling program, B&L should not be viewed
as a dividend producing entity.
William B. Rudolf, President and CEO, commented: “B&L’s
management is pleased with the production rates on B&L’s Welder
No. 1 well which are better than anticipated. The announcement by
FM O&G concerning the flow tests of its Lomond North/Highlander
discovery well is encouraging and appears to indicate that the well
should be capable of extremely high flow rates. We are not aware of
the well’s current production rates or FM O&G’s development
plans beyond information that has been made public, but if the
Highlander area is successfully developed with multiple wells, over
time the Highlander area could be very significant to B&L.
Meanwhile, B&L’s management is reevaluating all of its drilling
projects in the context of lower commodity prices. We will continue
to focus on building shareholder value through development of our
core minerals located beneath our fee lands and through other
investments.”
The Company maintains a website, www.biloximarshlandscorp.com,
and strongly recommends that all investors and interested parties
visit the website to view historical press releases, historical
financial statements, and other relevant information.
The Company continues to pursue a claim for damages against the
US Army Corps of Engineers for property loss and damage related to
the Mississippi River Gulf Outlet (MRGO).
Biloxi Marsh Lands Corporation owns approximately 90,000 acres
of marsh lands located in St. Bernard Parish, Louisiana. As the
landowner, it derives revenues from oil and gas exploration and
production activities that take place on or near the Company’s fee
lands and revenues from surface rentals. BLMC also owns a
seventy-five percent interest in B&L Exploration, LLC which
explores for and develops oil and gas primarily in Louisiana and
Texas.
This news release contains forward-looking statements regarding
oil and gas discoveries, oil and gas exploration, development and
production activities and reserves. Accuracy of the forward-looking
statements depends on assumptions about events that change over
time and is thus susceptible to periodic change based on actual
experience and new developments. The Company cautions readers that
it assumes no obligation to update or publicly release any
revisions to the forward-looking statements in this report.
Important factors that might cause future results to differ from
these forward-looking statements include: variations in the market
prices of oil and natural gas; drilling results; unanticipated
fluctuations in flow rates of producing wells; oil and natural gas
reserves expectations; the ability to satisfy future cash
obligations and environmental costs; and general exploration and
development risks and hazards. Readers are cautioned not to place
undue reliance on forward-looking statements made by or on behalf
of the Company. Each such statement speaks only as of the day it
was made. The factors described above cannot be controlled by the
Company. When used in this report, the words “believes,”
“estimates,” “plans,” “expects,” “could,” “should,” “outlook,” and
“anticipates” and similar expressions as they relate to the Company
or its management are intended to identify forward-looking
statements.
The following Statements of Assets, Liabilities and
Stockholders’ Equity—Income Tax Basis and Statements of Revenues
and Expenses—Income Tax Basis have been derived from the Company’s
end of the year financial statements, but do not include the
information and footnotes that are an integral part of a complete
financial statement. A complete copy of the audited Financial
Statements and Schedule—Income Tax Basis, Years Ended December 31,
2014 and 2013 along with the 2015 President’s Report to
Shareholders and the Company’s Proxy Statement will be available
after March 27, 2015 on the Company’s website
www.biloximarshlandscorp.com or through requesting a copy in
writing from the Company - Attention: Investor Relations, Biloxi
Marsh Lands Corporation, One Galleria Blvd., Suite #902, Metairie,
LA 70001.
BILOXI MARSH LANDS
CORPORATION Statements of Assets, Liabilities, and
Stockholders' Equity-Income Tax Basis December 31, 2014 and 2013
Assets 2014 2013 Current assets: Cash
and cash equivalents $ 2,815,481 3,378,827 Accounts receivable
114,739 64,157 Accrued interest receivable 20,310 20,838 Prepaid
expenses 40,867 38,967 Deferred tax asset 60,379 21,265 Federal
income taxes receivable 10,017 — State income taxes receivable
13,674 — Marketable debt securities - at cost 300,775 300,262 Other
assets 3,830 3,830 Total current assets 3,380,072
3,828,146 Investment in partnership 2,759,875 4,131,060
Marketable debt and equity securities - at cost 6,175,836 8,202,631
Land 234,939 234,939 Geological and geophysical costs - fee lands,
net of amortization 45,511 — Levees and office furniture and
equipment 314,943 314,943 Accumulated depreciation (313,440 )
(312,538 ) Total assets $ 12,597,736 16,399,181
Liabilities and Stockholders' Equity Current liabilities:
Income taxes payable $ — 599,250 Accrued expenses 34,906 35,893
Other current liabilities — 4,608 Total current
liabilities 34,906 639,751 Stockholders' equity:
Common stock, $0.001 par value.
Authorized, 20,000,000 shares; issued 2,851,196 shares;
outstanding, 2,535,028 and 2,715,028 shares in 2014 and 2013,
respectively
47,520 47,520 Retained earnings 15,357,935 16,169,535
Treasury stock, 316,168 and 136,168 shares
in 2014 and 2013, respectively, at cost
(2,842,625 ) (457,625 ) Total stockholders' equity 12,562,830
15,759,430 Total liabilities and stockholders' equity
$ 12,597,736 16,399,181
BILOXI MARSH LANDS CORPORATION Statements of
Revenues and Expenses - Income Tax Basis Years ended December 31,
2014 and 2013
3 Months Ended 12 Months Ended
December 31 December 31 2014
2013 2014 2013 Revenues: Oil and gas
royalties $ 138,326 137,820 508,205 614,690 Severance taxes (6,901
) (4,947 ) (23,553 ) (28,501 ) Oil and gas royalties, net 131,425
132,873 484,652 586,189 Surface rentals 50,000 50,000
50,000 50,000 Total oil and gas
revenues 181,425 182,873 534,652 636,189
Other income (loss): Income (loss) from
investment in partnership (388,128 ) (1,002,380 ) (1,371,185 )
(1,740,193 ) Dividends and interest income 44,842 37,549 202,819
164,275 Gain on settlement - 3,189,681 - 3,189,681 Gain on sale of
securities 196,486 214,126 1,717,041 2,072,125 Surface rentals
16,104 17,328 39,049 29,003
Total other income (loss) (130,696 ) 2,456,304 587,724
3,714,891 Total revenues and income 50,729
2,639,177 1,122,376 4,351,080
Expenses: Total expenses 293,760 453,865
945,848 1,091,414 Net income (loss) before
income taxes (243,031 ) 2,185,312 176,528 3,259,666
Income taxes: Income tax (benefit) expense
(179,400 ) 667,516 (25,883 ) 808,937 Net
income (loss) $ (63,631 ) 1,517,796 202,411 2,450,729
Net income (loss) per share $ (0.02 ) 0.56 0.08 0.90
Biloxi Marsh Lands CorporationColleen Starks, 504-837-4337
Biloxi Marsh Lands (CE) (USOTC:BLMC)
Historical Stock Chart
From May 2024 to Jun 2024
Biloxi Marsh Lands (CE) (USOTC:BLMC)
Historical Stock Chart
From Jun 2023 to Jun 2024