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American Company Spotlight

 

Patch International Inc. Website: Click Here

Exchange: OTCBB
 

Market Cap: 28.7 Million

Outstanding Shares: 19.9 Million

52 Low / High: $0.58 / $6.44

Price February 1, 2007: $1.44

PTCH Recent Stock Quote and News: Click Here

Information As Of February 1, 2007

"An initial independent resource reserve report by DeGolyer & MacNaughton estimated 448 MM bbls of probable reserves based on 3 existing coreholes."


Overview

Patch International Inc., currently focused on 2 core areas, the Dover Oil Sands and the Firebag Oil Sands Projects of which both properties are located in the Athabasca Oil Sands region near Fort McMurray, Alberta. Patch International Inc. has recently commenced drilling on both properties and the world-class project is surrounded by several analogous SAGD (Steam Assisted Gravity Drainage) projects producing 25,000- 37,000 Barrels of Oil Equivalent Per Day. Patch has 66 sq. miles of oil sands leases secured in this prolific Oil Sands region.


Investment Highlights

  • World class project surrounded by several analogous SAGD (Steam Assisted Gravity Drainage) projects producing 25,000- 37,000 Barrels of Oil Equivalent Per Day
  • The oil sands deposits in Alberta, Canada contain the second largest known reserve of oil in the world after Saudi Arabia, an estimated 175 billion barrels trapped in a complex mixture of sand, water and clay.
  • Patch International Inc. commenced drilling on its recently acquired Dover Oil Sands Project and the Firebag Oil Sands Project near Ft. McMurray in northeast Alberta. Drilling contractor rig Tempco # 1 started January 21, 2006 on the first of a minimum 28 earning wells. (January 26, 2007 Press Release)
  • Alberta's oil sands deposits were described by Time Magazine as "Canada's greatest buried energy treasure," one that "could satisfy the world's demand for petroleum for the next century."
  • Patch has 66 sq. miles of oil sands leases secured in this prolific Oil Sands region.
  • Positive results from the Oil Sands projects could result in 40,000 bbl/d production by spring 2009 for PTCH.
  • An initial independent resource reserve report by DeGolyer & MacNaughton estimated 448 MM bbls of probable reserves based on 3 existing coreholes.
     
 

Alberta Oil Sands Projects

Patch International Inc., currently focused on 2 core areas, the Dover Oil Sands and the Firebag Oil Sands Projects of which both properties are located in the Athabasca Oil Sands region near Fort McMurray, Alberta. Patch International Inc. has recently commenced drilling on both properties and the world-class project is surrounded by several analogous SAGD (Steam Assisted Gravity Drainage) projects producing 25,000- 37,000 Barrels of Oil Equivalent Per Day. Patch has 66 sq. miles of oil sands leases secured in this prolific Oil Sands region.

An initial independent resource reserve report by DeGolyer & MacNaughton estimated 448 MM bbls of probable reserves based on 3 existing coreholes. The Dover Oil Sands Project is within 10 miles of several major oil sands developments including Petro-Canada's SAGD MacKay River project which has 2006 production forecast of more than 25,000 barrels per day and has filed application with the Alberta Energy and Utilities Board to increase capacity to 70,000 b/d. Another Oil Sands development is TOTAL's Jocelyn SAGD/mining development with current operating, in application and announced capacity of 40,000 b/d and 200,000 b/d respectively; and lastly Canadian Natural Resources Limited's Horizon mining development which has started a 3 phase construction project to establish a production capacity of up to 387,000 b/d. The Dover Oil Sands Project is also positioned close to existing oil and gas pipelines and an all weather road. Other developments in the area include Chevron Corp.

The Firebag Oil Sands Project is approximately 40 miles east of Fort McMurray and represents approximately 11,520 acres. The leases on these lands are valid for 15 years. The closest oil sands development to the Firebag Oil Sands Project is the Firebag in-situ project operated by Suncor Energy Inc. which is approximately 25 miles northwest of the Firebag Oil Sands Project. The Suncor Firebag in-situ project is a SAGD project and is producing approximately 40,000 b/d but has approved and announced expansions to grow production to approximately 376,000 b/d. Other developments in the area include Encana Corporation and Oil Sands Quest Inc.

Positive results from the Oil Sands projects could result in 40,000 bbl/d production by spring 2009 for PTCH.


Oil Sands

SECOND LARGEST IN WORLD - The oil sands deposits in Alberta, Canada contain the second largest known reserve of oil in the world after Saudi Arabia, an estimated 175 billion barrels trapped in a complex mixture of sand, water and clay. They are abundant, accessible, and economically affordable to recover - especially at today's crude oil prices.

In actual fact, the oil sand deposits in northern Alberta could contain 1.7 to 2.5 trillion barrels of oil in place, more than all the presently known reserves of the Middle East

Alberta's oil sands deposits were described by Time Magazine as "Canada's greatest buried energy treasure," one that "could satisfy the world's demand for petroleum for the next century."

OIL SANDS CREATION - The most prominent theory of how this vast resource was formed suggests that light crude oil from southern Alberta migrated north and east with the same pressures that formed the Rocky Mountains. Over time, the actions of water and bacteria transformed the light crude into bitumen, a much heavier, carbon-rich and extremely viscous oil that requires upgrading.

Bitumen is best described as a thick, sticky form of crude oil, so heavy and viscous that it will not flow unless heated or diluted with lighter hydrocarbons. At room temperature, it is much like cold molasses. Oil sands are substantially heavier than other crude oils. Compared to conventional crude oil, bitumen requires some additional upgrading before it can be refined. It also requires dilution with lighter hydrocarbons to make it transportable by pipelines.
 

FOCUS ON ALBERTA OIL SANDS - With the continuing decline of conventional North American crude oil reserves, the focus is turning towards oil sands exploration, development, and production. According to the Alberta Energy and Utilities Board (AEUB), production from Alberta averaged just over one million barrels per day (bpd) of bitumen in 2004. Of this total, marketable production included more than 600,000 bpd sold as synthetic crude oil and distillates, and approximately 320,000 bpd sold as bitumen.

At the present time, marketable sales of synthetic crude oil and bitumen are estimated to account for 50% of Canadian crude oil output and 10% of North America's output.

A survey by an Alberta industry association from early 2005 indicates that Alberta's oil sands industry may spend $63.5 billion on new oil sands projects from 2005 to 2010 and as much as $79.5 billion in the 2005 to 2015 period. Another $16.5 billion may be spent on sustaining capital during 2005 to 2015 period.

In the 1996 to 2004 period, the oil sands industry spent an estimated $29 billion on new projects, plus an estimated $4.8 billion on sustaining capital.

 
 

Recent News and Press Releases

• Patch International Inc. to Present at the Independent Petroleum Association of America 2007 Oil & Gas Investment Symposia Small Cap (Wed, Jan 31)
 

• Patch International Inc. Commences Drilling of Alberta Oil Sands (Fri, Jan 26)
 

• Source Press: Oil Sands Projects Steam Ahead in Alberta, Despite Harper (Tue, Jan 23)
 

• Patch International Inc. Announces Receipt of Independent Engineering Report of Dover and Firebag Oil Sands Projects (Mon, Jan 22)
 

• PATCH INTERNATIONAL INC/CN Financials (Sat, Jan 20)
 

• Patch International CEO Updates Alberta Oil Sands Activity in Exclusive Interview with WallSt.net (Wed, Jan 17)
 

• Patch International Inc. Announces completion of Second Canadian Oilsands Acquisition and Appointment of Additional Directors (Wed, Jan 17)
 

• PATCH INTERNATIONAL INC/CN Files SEC form 10QSB, Quarterly Report (Tue, Jan 16)
 

• Patch International Inc. Announces CEO Interview Regarding Alberta Oil Sands Activity and Growth (Tue, Jan 16)

 
 

Management

Michael Vandale
Director, President & CEO

A veteran of the oil industry, Michael Vandale has had a long list of successful oil and gas ventures. Mr. Vandale was the chief executive officer and president of Arsenal Energy Inc. and continues to serve as chairman of the board and as a director. He is a director of Cold Creek Capital Inc., listed on TSX Venture Exchange and Gauco Capital Inc. He was President of Sundance Resources Inc., listed on the TSX Venture Exchange, and was a director of its successor company True Energy Inc., listed on the Toronto Stock Exchange, until the fall of 2002 when he started Arsenal Energy Inc. From 1997 to 1999, Mr. Vandale was a director and major shareholder of Mutual Fund Direct Inc. until it was sold to Altamira Investment Services Inc. From 1992 to 1996, Mr. Vandale was President of Midwestern Energy Company Limited. Mr. Vandale has more than 20 years experience in upstream oil and gas exploration and midstream operations in Canada, the United States and South America.

Mr. Vandale has also been director of the Canadian Soccer Association, Exeter City Football Club in Exeter , England , and owned the Calgary Storm in the North American A- League from 2001-2003.

Donald Edwards
Corporate Secretary

Donald Edwards is a partner with the law firm Borden Ladner Gervais LLP and the corporate secretary for the oil and gas companies Arsenal Energy Inc (TSX: AEI) and Cold Creek Capital Inc. (TSX-V: CCC.P). Mr. Edwards specializes in securities, corporate finance, commercial transactions, natural resource law and mergers & acquisitions. Mr. Edwards has acted for a broad range of domestic and foreign issuers, investment banks and securities dealers, with a particular emphasis on venture capital and mergers and acquisitions, in both domestic and cross border transactions.

Mr. Edwards is a member of the Law Society of Alberta and the Canadian Bar Association. He graduated from the University of Wales with an LL.B. in 1988 and was called to the Alberta Bar in 1990. Prior to that, he obtained a Bachelor of Science degree from the University of Alberta.

Terry Buchanan
Vice President of Exploration, Geoscience and Reservoir

Mr. Buchanan has extensive knowledge on oil sands projects along with several decades of experience in all phases of oil and gas exploration and development.

He has over 30 years oil and gas field experience specializing in reservoir description, hydrocarbon prospecting, completions and production. Most recently he was the Geoscience Advisor for Imperial Oil conducting geotechnical and reservoir engineering studies of mature to conceptual plays for prospect generation, assessment, development and productivity enhancement. His early training and experience with a major wire line service company has fostered a keen interest in exploiting oil field data to unlock commercial hydrocarbons. He is a member of the Association of Professional Engineers, Geologists, and Geophysicists of Alberta (APEGGA), the Canadian Society of Petroleum Geologists (CSPG) and the Canadian Well Logging Society (CWLS). Mr. Buchanan is a graduate of the University of Alberta in 1974.

Jason Dagenais
Vice President of Operations

Mr. Dagenais is a professional engineer with 12 years oil and gas experience specializing in Exploitation Engineering, with particular focus on Project Management & Reservoir Engineering. He is proficient in exploiting, and growing core areas regionally with G&G technical talents. Mr. Dagenais career focus has been the Western Canadian Sedimentary Basin (WCSB), managing value add projects from concept (prospecting, mapping & landsales) to completion (drilling, completion, production and marketing)

Most recently, he was President and CEO of Dyno Energy Ltd, a private oil and gas in Calgary, Alberta. Previously, Mr. Dagenais held senior management positions with companies that include Delphi Energy, Rise Energy, Schlumberger, Ulster Petroleums, Pinnacle Resources, and McAllister Petroleums. He is a member of the Association of Professional Engineers, Geologists, and Geophysicists of Alberta (APEGGA). Mr. Dagenais is a graduate of the University of Regina with a degree in Industrial Systems Engineering in 1995.
 


Contacts

Corporate Head Office
Patch International Inc.
T: (403) 441-4390
F: (403) 441-4395
Suite # 300, 441 - 5th Avenue S.W.
Calgary, AB., Canada
T2P 2V1

Email: info@patchenergy.com


 

 

 

 

 

FORWARD LOOKING STATEMENTS

This report includes forward-looking statements that reflect Patch International Inc. current expectations about its future results, performance, prospects and opportunities. Patch International Inc. has tried to identify these forward-looking statements by using words and phrases such as "may," "will," "expects," "anticipates," "believes," "intends," "estimates," "plan," "should," "typical," "preliminary," "we are confident" or similar expressions. These forward-looking statements are based on information currently available and are subject to a number of risks, uncertainties and other factors that could cause Patch International Inc.'s actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. These risks, uncertainties and other factors include, without limitation, the Company's growth expectations and ongoing funding requirements, and specifically, the Company's growth prospects with scalable customers, and those outlined above. Other risks include the Company's limited operating history, the Company's history of operating losses, consumers' acceptance, the Company's use of licensed technologies, risk of increased competition, the potential need for additional financing, the terms and conditions of any financing that is consummated, the limited trading market for the Company's securities, the possible volatility of the Company's stock price, the concentration of ownership, and the potential fluctuation in the Company's operating results.


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