Our primary business objective is to maximize risk-adjusted total returns to our shareholders by capturing growth in free cash flow undeveloped drilling locations without capital expenditures or lease operating expenses. In addition, we intend to use our proprietary technology to execute upon our scalable business model of sourcing, evaluating, and increasing our mineral portfolio.
Through our proprietary software and data system which provides data to use to assess mineral rights prior to purchasing such rights. The software creates a low risk investment opportunity in the high-risk, volatile sector of oil and gas as compared to alternative acquisition methods that subject companies to additional overhead and liabilities.
I hope this update finds you all healthy and that that you are learning new ways to navigate our new post COVID reality as we are doing here at War Party Minerals.
Today I would like to update you on several new developments as well as answer some of the most commonly asked questions we hear from our partners.
First, we have a new home!
We are nearing completion on the move into our brand-new offices in Plano Texas.
This move places us in a much more desirable location that is better suited to our needs, and along with streamlining our staff we have also been able to significantly reduce our overhead in the process, without sacrificing efficiency in our business model.
Many of you have asked about our timing for a future listing on a major exchange.
As you can imagine, the COVID virus has impacted every industry and the volatility of the market has a majority of institutional investors in a holding pattern.
Many sources of capital have simply dried up for the time being; while investors seek to learn how the COVID virus will affect the economy as a whole and the effects it will have on specific sectors of the economy.
That being said, we are still working closely with our contacts on Wall Street and continue to have meaningful conversations.
These talks are productive and are laying the groundwork, so we are well prepared to move forward as soon as we see the inevitable turn to a more positive outlook in the market and freeing up of capital.
While the prospects of becoming a public company are still and have always been an exciting part of our plan, it’s important not to forget all of this is based on an intelligent, unique and proven business model that takes advantage of the rapidly changing oil and gas markets, and adjusts automatically to the current, prices and trends in oil and gas.
Outside of the current situation on Wall Street, and in spite of the new rules of business that COIVD has required us to adapt to, we have continued to move forward.
We are pursuing multiple avenues of our business model as a privately held company to build revenue. Some of these include brokering, profit sharing, and flipping mineral properties to name a few.
The current volatility and changing landscape of the oil and gas industry has created some very unique opportunities that War Party Minerals is well positioned to take full advantage of over the coming weeks and months.
All of these are in the pursuit of showing the viability of our technology and building a complete proven platform for predictive buying, as well as building a solid revenue stream between now and our eventual public listing.
We appreciate all of our partners, especially as we navigate this ever-changing business environment.
Until our next update, we wish you and your families the best of health.
WarParty Minerals Inc.
I hope this letter finds everyone in good health.
What a wild ride we have been on over the last thirty days. This last month we have seen something we have never seen in history… negative oil prices!
What does this mean for our company?
Well for starters let’s look at a few facts. Will electric cars replace the demand for the combustion engine? A simple search of global market share for electric passenger cars show’s as of 2019 this average is only 2.5%. What about green energy? Global renewable electricity generation (less hydro) is at 9.3% as of the best estimates for 2018. What about the byproducts of petroleum? Currently over 6,000 items are made from petroleum byproducts!
So, what does this tell us?
Should we be fear the dip in oil production has the ride ended?
The answer is quite simply NO!
The headlines would have you believe the world has adapted newer technologies and our use of petroleum is about to end but it’s simply not true. It does make for a salacious story, but the reality is quite different.
Having been involved in the oil and gas industry for almost 20 years these ups and downs are part of a cyclical market that like other industries have points where there is a market correction.
Let me explain why we are leading our industry and why we are better positioned for these corrections in the energy market for the long term.
First, we only purchase minerals. Minerals are real property. This means we own this asset FOR EVER. We only pay taxes on the minerals extracted and pay nothing while it stays in the ground. Our taxes are paid from the production and we receive the balance.
Second, our company focuses on technology that evaluates multiple data sets with information that clues us in on the best areas of a basin to pursue and purchase. This will often put our purchases under very large oil and gas operators who are looking as some of the same data as we are. These operators are playing a long game with development plans that span years and even decades in these oil and gas rich basins.
I can tell you there will most likely be a shuffling of the deck with some of the larger names in the E & P space. Some will go under and some will merge in order to survive.
The industry as whole will survive for the foreseeable future and we are positioning ourselves for this future.
We are excited about what we are developing in house and have the first-hand experience and know how to best position our company for the future.