BNP Resources Inc. V.BNX.A

BNP - Letter to Shareholders - April 2017

[BNPResources]

RE: April 2017 - Monthly Letter to Shareholders

 
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. The following is a summary of activities over the past month:

1. We are in the process of updating the business plans and budgets, for our upcoming 2017 projects.
2. I will be preparing the formal loan application documents, this week. This application will be packaged with the revised business plans and budgets.
3. Discussed business plans and financing with our management team and the partners. Potential office space has been identified. Rental rates are much lower than 2 years ago and landlords are more flexible, thanks to a 25% vacancy rate in downtown Calgary.
4. John Browne has retired as a director of BNP Resources, this past month. We thank John for his involvement as a director of BNP since 2006, and wish him well in his retirement. We have identified 2-3 new candidates that will be nominated, once the company is on track to trading again. These candidates will have a large financial interest, in the operations, as partners in the pipeline, power generation and transmission business unit.
5. Toby Schultz has retired from the practice of law, and will no longer be our legal council. We have identified a candidate and will announce the details over the next 1-2 months. The candidate is bilingual and has experience in dealing with the federal government. He will be responsible for the government approvals, NEB applications and the loan guarantees for the pipeline, power generation and transmission project. Our latest budget for this project is about $2.0 Billion, in Canadian funds.
6. We will be following the Fortis / Emera business model for energy investments. Emera has grown from a market capitalization of $2.8 Billion, to over $28.0 Billion, as a public company.

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

1. Phase I funding (part of $100+ million debt financing) - Natural gas pipeline to Yellowknife – NT – 60% equity interest.
2. Phase I funding (part of $100+ million debt financing) - Power Generation, Transmission and Distribution – Yellowknife (30% equity interest) – provide power to mines.
3. Phase I funding (part of $100+ million debt financing) - Purchase of 1,000 – 1,800 barrel per day oil facility - $75 million.
4. Phase I funding (part of $100+ million debt financing) – Purchase 49 barrel per day Chin Coulee field.
5. Phase I funding (part of $100+ million debt financing) – Farm in on 2 South Ferguson DUC’s (drilled uncompleted wells).
6. Phase I funding (part of $100+ million debt financing) - Oil well abandonment (environmental) company
7. Natural gas play – Purchase existing natural gas assets along Yellowknife pipeline project, right of way, to feed into pipeline (with partners). Costs – TBA.
8. Develop Jensen leases (farm in from Privco) - $5 million, subject to farm in.
9. Montana oil development project - Nisku and Lodgepole (with partners).
10. Montana Helium project (brought to us by a long term BNP shareholder). Requires a $10 million budget.
11. Del Bonita Midstream and Oil Trucking Company – Disposal, separation and storage at oil leases, plus oil and emulsion trucking - $1.5 million
12. Del Bonita Power – Power generation and distribution, at oil leases - $1.5 million
13. 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.
14.  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