GEOI » Topics » Business Strategy.

This excerpt taken from the GEOI 10-K filed Jun 11, 2009.

Our Business Strategy

We implemented our business strategy upon the closing of the Merger. Our strategy includes a combination of acquisition, re-engineering, development and exploration activities. We first focus on building reserves and cash flows and then expand acreage, development and exploration inventory. Further, our strategy includes activities with geological and geographical diversity.

Our business strategy includes:

 

   

Acquiring additional oil and gas reserves through asset or corporate acquisitions or mergers;

 

   

Expanding acreage and prospect inventory through internal generation of new projects and selective prospect participations with other capable oil and gas operators;

 

   

Comprehensive field re-engineering, designed to increase and maintain production, lower per-unit operating expenses, and therefore, improve field economics; and

 

   

Development, exploitation and exploration activities intended to increase production and estimated proved reserves.

This fundamental operating and technical strategy is complemented by management’s commitment to:

 

   

Maintain a fundamentally sound capital structure which provides the Company a low cost of capital;

 

   

Control capital, operating and administrative costs;

 

   

Hedge a portion of total production to provide a foundation of predictable cash flows to support development and exploration activities;

 

   

Divest non-core assets to high-grade our portfolio of properties; and

 

Page 10


Table of Contents
Index to Financial Statements
   

Promote industry and institutional partners into projects to manage risk and to lower net finding and development costs.

In the opinion of management, our strategy is appropriate for us because:

 

   

It addresses multiple risks of oil and gas operations while providing shareholders with significant upside potential;

 

   

It results in “staying-power,” which management believes is essential to mitigate the adverse impacts of volatile commodity prices and financial markets; and

 

   

It is a strategy employed successfully in prior entities formed, acquired and operated by management.

Each component of our business strategy and related matters are briefly discussed below.

Acquisitions and Divestitures – Acquisitions of oil and gas properties and/or companies in conjunction with exploration and development activities are intended to allow us to assemble a portfolio of properties with the potential for meaningful economic returns from (1) the application of operational and technical attention, (2) development of non-producing reserves, and (3) realization of exploration upside. We seek to acquire oil and gas interests with the characteristics of manageable risks, fairly predictable production and value enhancement potential. An ongoing part of our portfolio approach is the divestiture of non-core assets in order to streamline and high-grade our oil and gas property portfolio. Divestitures of this type of properties are an integral part of our strategy.

Development Activities – We are also focused on development and exploitation of non-producing reserves. We conduct comprehensive field studies, which usually result in:

 

   

Re-engineering projects with the intent to lower per-unit operating expenses and/or reduce field down-time. In addition, we seek to implement more efficient production practices in order to increase production and/or arrest natural field production declines. These practices are often deployed in fields in connection with or in anticipation of further field development activities such as installation of secondary recovery operations or additional drilling.

 

   

Development and exploration projects resulting from the integration of operations and reservoir engineering with geology and geophysics. When applicable, 3-D seismic technology is utilized. Our objective is to develop specific projects to recover bypassed or undeveloped reserves and define exploration potential.

Exploration – We believe our management and technical personnel have the experience and capability to expand our acreage positions and drilling inventory, and accordingly, we expect to continue to expand our exploration activities as our asset base increases. This strategy has three distinct purposes:

 

   

Expand our inventory of substantive acreage and prospects;

 

   

Fully develop acquired properties; and

 

   

Realize substantial economic returns from exploration.

While we intend to dedicate a meaningful portion of our budget to exploration and drilling, as the geological objectives move to a higher risk and cost profile, industry or institutional partners may be solicited on a promoted basis where we sell part of the project in exchange for cash and/or a carried interest.

Corporate Mergers and Acquisitions – As a distinct part of our overall strategy, we continue to pursue corporate merger and acquisition opportunities. Criteria for such acquisitions might include, but are not limited to:

 

   

The potential to increase assets in a core area;

 

   

The opportunity to increase our earnings and cash flow;

 

   

Development and exploration potential;

 

   

The ability to refinance debt and attract capital; and

 

   

Realization of administrative savings.

 

Page 11


Table of Contents
Index to Financial Statements

In summary, we believe these diversified business strategies and methodical processes will maintain the reserve and production base and lead to growth in reserves, production, cash flow and consequently, in per share values.

 

Page 12


Table of Contents
Index to Financial Statements
These excerpts taken from the GEOI 10-K filed Mar 25, 2009.

Our Business Strategy

We implemented our business strategy upon the closing of the Merger. Our strategy includes a combination of acquisition, re-engineering, development and exploration activities. We first focus on building reserves and cash flows and then expand acreage, development and exploration inventory. Further, our strategy includes activities with geological and geographical diversity.

Our business strategy includes:

 

   

acquiring additional oil and gas reserves through asset or corporate acquisitions or mergers;

 

   

expanding acreage and prospect inventory through internal generation of new projects and selective prospect participations with other capable oil and gas operators;

 

   

comprehensive field re-engineering, designed to increase and maintain production, lower per-unit operating expenses, and therefore, improve field economics; and

 

   

development, exploitation and exploration activities intended to increase production and estimated proved reserves.

This fundamental operating and technical strategy is complemented by management’s commitment to:

 

   

maintain a fundamentally sound capital structure which provides the Company a low cost of capital;

 

   

control capital, operating and administrative costs;

 

   

hedge a portion of total production to provide a foundation of predictable cash flows to support development and exploration activities;

 

   

divest non-core assets to high-grade our portfolio of properties; and

 

7


Table of Contents
Index to Financial Statements
   

promote industry and institutional partners into projects to manage risk and to lower net finding and development costs.

In the opinion of management, our strategy is appropriate for us because:

 

   

it addresses multiple risks of oil and gas operations while providing shareholders with significant upside potential;

 

   

it results in “staying-power,” which management believes is essential to mitigate the adverse impacts of volatile commodity prices and financial markets; and

 

   

it is a strategy employed successfully in prior entities formed, acquired and operated by management.

Each component of our business strategy and related matters are briefly discussed below.

Acquisitions and Divestitures – Acquisitions of oil and gas properties and/or companies in conjunction with exploration and development activities are intended to allow us to assemble a portfolio of properties with the potential for meaningful economic returns from (1) the application of operational and technical attention, (2) development of non-producing reserves, and (3) realization of exploration upside. We seek to acquire oil and gas interests with the characteristics of manageable risks, fairly predictable production and value enhancement potential. An ongoing part of our portfolio approach is the divestiture of non-core assets in order to streamline and high-grade our oil and gas property portfolio. Divestitures of this type of properties are an integral part of our strategy.

Development Activities – We are also focused on development and exploitation of non-producing reserves. We conduct comprehensive field studies, which usually result in:

 

   

Re-engineering projects with the intent to lower per-unit operating expenses and/or reduce field down-time. In addition, we seek to implement more efficient production practices in order to increase production and/or arrest natural field production declines. These practices are often deployed in fields in connection with or in anticipation of further field development activities such as installation of secondary recovery operations or additional drilling.

 

   

Development and exploration projects resulting from the integration of operations and reservoir engineering with geology and geophysics. When applicable, 3-D seismic technology is utilized. Our objective is to develop specific projects to recover bypassed or undeveloped reserves and define exploration potential.

Exploration – We believe our management and technical personnel have the experience and capability to expand our acreage positions and drilling inventory, and accordingly, we expect to continue to expand our exploration activities as our asset base increases. This strategy has three distinct purposes:

 

   

expand our inventory of substantive acreage and prospects;

 

   

fully develop acquired properties; and

 

   

realize substantial economic returns from exploration.

While we intend to dedicate a meaningful portion of our budget to exploration and drilling, as the geological objectives move to a higher risk and cost profile, industry or institutional partners may be solicited on a promoted basis where we sell part of the project in exchange for cash and/or a carried interest.

Corporate Mergers and Acquisitions – As a distinct part of our overall strategy, we continue to pursue corporate merger and acquisition opportunities. Criteria for such acquisitions might include, but are not limited to:

 

   

the potential to increase assets in a core area;

 

   

the opportunity to increase our earnings and cash flow;

 

   

development and exploration potential;

 

   

the ability to refinance debt and attract capital; and

 

   

realization of administrative savings.

In summary, we believe these diversified business strategies and methodical processes will maintain the reserve and production base and lead to growth in reserves, production, cash flow and consequently, in per share values.

 

8


Table of Contents
Index to Financial Statements

Our Business Strategy

We implemented our business strategy upon the closing of the Merger. Our strategy includes a combination of acquisition, re-engineering, development and exploration activities. We first focus on building reserves and cash flows and then expand acreage, development and exploration inventory. Further, our strategy includes activities with geological and geographical diversity.

Our business strategy includes:

 

   

acquiring additional oil and gas reserves through asset or corporate acquisitions or mergers;

 

   

expanding acreage and prospect inventory through internal generation of new projects and selective prospect participations with other capable oil and gas operators;

 

   

comprehensive field re-engineering, designed to increase and maintain production, lower per-unit operating expenses, and therefore, improve field economics; and

 

   

development, exploitation and exploration activities intended to increase production and estimated proved reserves.

This fundamental operating and technical strategy is complemented by management’s commitment to:

 

   

maintain a fundamentally sound capital structure which provides the Company a low cost of capital;

 

   

control capital, operating and administrative costs;

 

   

hedge a portion of total production to provide a foundation of predictable cash flows to support development and exploration activities;

 

   

divest non-core assets to high-grade our portfolio of properties; and

 

7


Table of Contents
Index to Financial Statements
   

promote industry and institutional partners into projects to manage risk and to lower net finding and development costs.

In the opinion of management, our strategy is appropriate for us because:

 

   

it addresses multiple risks of oil and gas operations while providing shareholders with significant upside potential;

 

   

it results in “staying-power,” which management believes is essential to mitigate the adverse impacts of volatile commodity prices and financial markets; and

 

   

it is a strategy employed successfully in prior entities formed, acquired and operated by management.

Each component of our business strategy and related matters are briefly discussed below.

Acquisitions and Divestitures – Acquisitions of oil and gas properties and/or companies in conjunction with exploration and development activities are intended to allow us to assemble a portfolio of properties with the potential for meaningful economic returns from (1) the application of operational and technical attention, (2) development of non-producing reserves, and (3) realization of exploration upside. We seek to acquire oil and gas interests with the characteristics of manageable risks, fairly predictable production and value enhancement potential. An ongoing part of our portfolio approach is the divestiture of non-core assets in order to streamline and high-grade our oil and gas property portfolio. Divestitures of this type of properties are an integral part of our strategy.

Development Activities – We are also focused on development and exploitation of non-producing reserves. We conduct comprehensive field studies, which usually result in:

 

   

Re-engineering projects with the intent to lower per-unit operating expenses and/or reduce field down-time. In addition, we seek to implement more efficient production practices in order to increase production and/or arrest natural field production declines. These practices are often deployed in fields in connection with or in anticipation of further field development activities such as installation of secondary recovery operations or additional drilling.

 

   

Development and exploration projects resulting from the integration of operations and reservoir engineering with geology and geophysics. When applicable, 3-D seismic technology is utilized. Our objective is to develop specific projects to recover bypassed or undeveloped reserves and define exploration potential.

Exploration – We believe our management and technical personnel have the experience and capability to expand our acreage positions and drilling inventory, and accordingly, we expect to continue to expand our exploration activities as our asset base increases. This strategy has three distinct purposes:

 

   

expand our inventory of substantive acreage and prospects;

 

   

fully develop acquired properties; and

 

   

realize substantial economic returns from exploration.

While we intend to dedicate a meaningful portion of our budget to exploration and drilling, as the geological objectives move to a higher risk and cost profile, industry or institutional partners may be solicited on a promoted basis where we sell part of the project in exchange for cash and/or a carried interest.

Corporate Mergers and Acquisitions – As a distinct part of our overall strategy, we continue to pursue corporate merger and acquisition opportunities. Criteria for such acquisitions might include, but are not limited to:

 

   

the potential to increase assets in a core area;

 

   

the opportunity to increase our earnings and cash flow;

 

   

development and exploration potential;

 

   

the ability to refinance debt and attract capital; and

 

   

realization of administrative savings.

In summary, we believe these diversified business strategies and methodical processes will maintain the reserve and production base and lead to growth in reserves, production, cash flow and consequently, in per share values.

 

8


Table of Contents
Index to Financial Statements

Our Business Strategy

We implemented our business strategy upon the closing of the Merger. Our strategy includes a combination of acquisition, re-engineering, development and exploration activities. We first focus on building reserves and cash flows and then expand acreage, development and exploration inventory. Further, our strategy includes activities with geological and geographical diversity.

Our business strategy includes:

 

   

acquiring additional oil and gas reserves through asset or corporate acquisitions or mergers;

 

   

expanding acreage and prospect inventory through internal generation of new projects and selective prospect participations with other capable oil and gas operators;

 

   

comprehensive field re-engineering, designed to increase and maintain production, lower per-unit operating expenses, and therefore, improve field economics; and

 

   

development, exploitation and exploration activities intended to increase production and estimated proved reserves.

This fundamental operating and technical strategy is complemented by management’s commitment to:

 

   

maintain a fundamentally sound capital structure which provides the Company a low cost of capital;

 

   

control capital, operating and administrative costs;

 

   

hedge a portion of total production to provide a foundation of predictable cash flows to support development and exploration activities;

 

   

divest non-core assets to high-grade our portfolio of properties; and

 

7


Table of Contents
Index to Financial Statements
   

promote industry and institutional partners into projects to manage risk and to lower net finding and development costs.

In the opinion of management, our strategy is appropriate for us because:

 

   

it addresses multiple risks of oil and gas operations while providing shareholders with significant upside potential;

 

   

it results in “staying-power,” which management believes is essential to mitigate the adverse impacts of volatile commodity prices and financial markets; and

 

   

it is a strategy employed successfully in prior entities formed, acquired and operated by management.

Each component of our business strategy and related matters are briefly discussed below.

Acquisitions and Divestitures – Acquisitions of oil and gas properties and/or companies in conjunction with exploration and development activities are intended to allow us to assemble a portfolio of properties with the potential for meaningful economic returns from (1) the application of operational and technical attention, (2) development of non-producing reserves, and (3) realization of exploration upside. We seek to acquire oil and gas interests with the characteristics of manageable risks, fairly predictable production and value enhancement potential. An ongoing part of our portfolio approach is the divestiture of non-core assets in order to streamline and high-grade our oil and gas property portfolio. Divestitures of this type of properties are an integral part of our strategy.

Development Activities – We are also focused on development and exploitation of non-producing reserves. We conduct comprehensive field studies, which usually result in:

 

   

Re-engineering projects with the intent to lower per-unit operating expenses and/or reduce field down-time. In addition, we seek to implement more efficient production practices in order to increase production and/or arrest natural field production declines. These practices are often deployed in fields in connection with or in anticipation of further field development activities such as installation of secondary recovery operations or additional drilling.

 

   

Development and exploration projects resulting from the integration of operations and reservoir engineering with geology and geophysics. When applicable, 3-D seismic technology is utilized. Our objective is to develop specific projects to recover bypassed or undeveloped reserves and define exploration potential.

Exploration – We believe our management and technical personnel have the experience and capability to expand our acreage positions and drilling inventory, and accordingly, we expect to continue to expand our exploration activities as our asset base increases. This strategy has three distinct purposes:

 

   

expand our inventory of substantive acreage and prospects;

 

   

fully develop acquired properties; and

 

   

realize substantial economic returns from exploration.

While we intend to dedicate a meaningful portion of our budget to exploration and drilling, as the geological objectives move to a higher risk and cost profile, industry or institutional partners may be solicited on a promoted basis where we sell part of the project in exchange for cash and/or a carried interest.

Corporate Mergers and Acquisitions – As a distinct part of our overall strategy, we continue to pursue corporate merger and acquisition opportunities. Criteria for such acquisitions might include, but are not limited to:

 

   

the potential to increase assets in a core area;

 

   

the opportunity to increase our earnings and cash flow;

 

   

development and exploration potential;

 

   

the ability to refinance debt and attract capital; and

 

   

realization of administrative savings.

In summary, we believe these diversified business strategies and methodical processes will maintain the reserve and production base and lead to growth in reserves, production, cash flow and consequently, in per share values.

 

8


Table of Contents
Index to Financial Statements
This excerpt taken from the GEOI 8-K filed Feb 20, 2008.
Business Strategy.  Upon closing the Merger in April 2007, our new management implemented its business strategy, which includes:

·  
expanding acreage and prospect inventory through internal generation of new prospects, field and regional studies on existing assets and surrounding acreage, corporate or asset acquisitions or mergers, and selective participation with other capable oil and gas operators;

·  
acquiring additional oil and gas reserves through asset or corporate acquisitions or mergers;

·  
comprehensive field re-engineering, designed to enhance current production, lower per unit operating expenses, reduce production failures and down time, and therefore improve field economics, longevity of production and reserve value; and

·  
development, exploitation and exploration activities intended to increase production and estimated proved reserves.

This fundamental operating and technical strategy is complemented by management’s commitment to:

·  
maintain a fundamentally sound capital structure and low cost of capital;

·  
control capital, operating and administrative costs;

·  
hedge production to provide a foundation to seek predictable cash flows to support development and exploration activities;

·  
divest non-core assets to high-grade the portfolio of properties; and

·  
promote industry and institutional partners into projects to manage risk and to lower net finding and development costs.

4
 
The key to management’s approach is that
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