BNP Resources Inc. V.BNX.A

BNP Letter to Shareholders - December 2016

[BNPResources]

Dear Shareholders:
 
The purpose of this monthly letter is to bring BNP shareholders up to date, on issues and news, since the last letter.

1. Funding – Our agent made contact with a company with potential to provide $100 million in debt financing. This company is also interested in providing the debt financing package for the pipeline. We are working towards setting an appointment to meet in January of 2017, to discuss and proceed with an application. Arranging financing is a slow process, working with one agent and one financing source at a time, unlike arranging a mortgage on a house or a car. We remain optimistic that 2017 with be our turn around year. I’ll keep the shareholders updated on the credit application progress, at the end of January.

2. The following is an update on the North American Helium exploration play, provided by one of our shareholders: See links below.

https://www.cbc.ca/news/canada/saskatchewan/helium-exploration-saskatchewan-1.3908233
 
https://minerals.usgs.gov/minerals/pubs/commodity/helium/mcs-2016-heliu.pdf

3. New project added to our back log – Willisden Basin, Saskatchewan – Made contact with a Vancouver group, this month, that have a new nuclear logging technology (approved in Canada), combined with better methods for sealing water zones in horizontal and vertical oil wells. We would need to hire a Saskatchewan geologist to search for suitable wells. We would purchase the target well and pay a portion of the completion costs, with our partner paying a portion, and taking a royalty if successful. Very good success with this technology in other parts of the world. Not used in North America yet. This is an “Oilwell, Water Zone Sealer Technology”.

4. Crude oil finished the year, 2016, at $53.89 US per WTI barrel. We are optimistic that the industry will prosper once again in 2017 – 2018.

5. The Electoral College vote was completed on December 20^th, with Mr. Trump receiving the required 270+ votes. He will take over as president on January 20^th. I have some concerns that the transfer of power, is not going as smoothly as possible. This refers to the UN resolution on Israel and the 35 Russian diplomats that were ejected from the USA. The current administration has never been as busy as this, over their last 8 years in office. I don’t recall so much activity in the final month of office, by any previous administration.

6. The following is a summary of the project back log for BNP Resources:

1. Develop South Ferguson farm in. Invest $5 million to develop 2 x DUC’s (drilled uncompleted wells).
2. Develop Jensen leases (farm in from Privco) - $5 million, subject to farm in.
3. Montana oil development project - Nisku and Lodgepole (with partners).
4. Montana Helium project (brought to us by a long term BNP shareholder). Requires a $10 million budget.
5. Del Bonita Midstream and Oil Trucking Company – Disposal, separation and storage at oil leases, plus oil and emulsion trucking - $1.5 million
6. Del Bonita Power – Power generation and distribution, at oil leases - $1.5 million
7. Power Generation and Distribution – Yellowknife (tentative and with partners) – If Yellowknife pipeline proceeds, there could be opportunities to provide power and distribution lines, for the 3 existing mines, located NE of Yellowknife, plus one new gold mine, currently in the exploration stage. Costs – TBA.
8. Lead zinc mine reactivation opportunity (with partners) – If the Yellowknife Pipeline proceeds, an opportunity exists to reactivate an existing orebody. Compressed natural gas would be used as fuel for the heavy haul trucks, instead of diesel, reducing operating costs. Costs and share acquisition – TBA.
9. Natural gas play – Purchase existing natural gas assets along Yellowknife pipeline project, right of way, to feed into pipeline (with partners). Costs – TBA.
10. New project – Willisden Basin, Saskatchewan – Made contact with a Vancouver group that have a new nuclear logging technology (approved in Canada), combined with better methods for sealing water zones in horizontal and vertical oil wells. We would need to hire a Saskatchewan geologist to search for suitable wells. We would purchase the target well and pay a portion of the completion costs, with our partner paying a portion and taking a royalty if successful. Very good success with this technology in other parts of the world. Not used in North America yet. Budget: $2 million.

The following is a quote from the late Steve Jobs, that applies to my work on behalf of our shareholders and creditors: “I'm convinced that about half of what separates the successful entrepreneurs from the non-successful ones is pure perseverance.... Unless you have a lotof passion about this, you're not going to survive. You're going to give it up. So you've got to have an idea, or a problem or a wrong that you want to right that you're passionate about; otherwise, you're not going to have the perseverance to stick it through.”
 
Wishing our shareholders a successful and prosperous 2017. God willing, 2017 will be the turn around year, for BNP Resources.