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Native American Energy
Group and Tribal Members work together to revitalize The Fort Peck Reservation by using
the latest technology to revive abandoned oil wells
Energy
Oil & Gas
(SYMBOL: NVMG-OTCPK)
Native American Energy Group (NAEG)
72-11 Austin Street #288
Forest Hill, NY 11375
Phone: 800-780-8076
Joseph D’Arrigo
President and CEO
Raj Nanvaan
Chief Financial Officer
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
December 15, 2005
BIO: Joseph G. D’Arrigo
has a background in finance and business management. He has worked with several private
and public companies in helping them make the transformation from development stage to
profitability. Over the last decade he has helped establish and finance three
casinos on Native American Land in the United States. He has also been involved in the
Gaming Industry working with many successful entrepreneurs in casino development and
finance.
As Founder/President and Chief Executive Officer his vision is to help the Native American
community, take advantage of the opportunities available to them by implementing solid
business strategy and finance diversification.
Raj S. Nanvaan has worked with several development
stage companies in helping them with public offerings, listings, mergers, and
acquisitions. He has developed and managed capital raising for publicly traded companies.
As a corporate engineer, he specializes in corporate repositioning, financing, financial
communication and capital sourcing.
Raj is also a founding member of the CEO Council, A
global non-profit organization representing the interests of public companies and their
management on the American Stock Exchange, Nasdaq, OTCBB and Pink Sheets in the U.S., and
exchanges around the world.
As Co-Founder/Vice President & Chief Financial
Officer, his extensive background in the investment banking arena make him an integral
part of the corporate structure and financial operations of Native American Energy Group.
In 2001, they both joined forces to build a solid
corporate structure and help Native American tribes develop the energy resources in Indian
Country. After four years of research & development, they formed Native American
Energy Group and implemented a solid business plan and commenced business operations in
January 2005.
Company Profile: Native American Energy Group (NAEG)
specializes in acquiring and revitalizing abandoned oil fields with substantial known
reserves in place, as well as, introducing energy alternatives. They spotlight oil fields
on Native American land, which were previously developed and capped (shut-in) due to
depressurization, production falling below commercial levels at that time, or in
situations where termination of previous oil & gas leases by the tribal governments
was due to improper development and refusal to simply employ Native Americans.
CEOCFO: Mr. D’Arrigo, what was your vision when the
group formed and where are you today?
Mr. D’Arrigo: “We began five years ago, to be the
liaison between the tribes and companies that perform enhanced oil recovery. Our mission
was to help the tribes negotiate with these companies and to help them create a long-term
plan for renewable energy. However, since then our company has evolved into what you see
today. We can now provide the Tribes with the most advanced technology to date. We spent a
lot of time and money researching what’s out there. We found a chemical process to
repressurize old fields and dramatically increase production. We are one of a select few
in the world that have access to this technology. Native American communities needed true
heroes, to come in and do the right thing. Today we have created an infrastructure on the
Fort Peck Indian Reservation, which can be duplicated across the country. Our company has
put together a team of experienced engineers to revitalize communities like Fort Peck.
However, our approach was not to give them handouts like used clothes and food baskets. At
Fort Peck, our team has gone in and identified several oil wells in the area that are
perfect for our process. We are using the latest technology to screen and identify which
capped and abandoned wells fit our criteria. While this is happening we have interviewed
and hired several locals to work with us.”
CEOCFO: Why have you
started with Fort Peck?
Mr. Nanvaan: “After five years of research and fine
tuning the Fort Peck Reservation was the most logical choice. Since we began our
intentions were to work with the Tribes on there wells, which was the easy part. The hard
part was proving to them that we weren’t going to take advantage of them like so
many, before us had. We had attempted to create this infrastructure with another tribe;
however, we couldn’t get past the politics and distrust. Fort Peck was a different
situation; we had prior dealings with a few of the tribal members, so they knew our
intentions were sincere.”
Mr. D’Arrigo:
“The goal is to prove our point, and duplicate this process across the country. As
with anything worth while our patience and understanding of there situation is paying off.
Although Fort Peck has been the proving ground, our intention has always been to expand.
We created our infrastructure with that in mind. We can replicate this process anywhere in
the country. I feel that our country shouldn’t have to depend on foreign reserves. We
have the resources right here on our own soil, we just need to work together, and use what
we have to become less dependent on countries that use our money, to try and kill us. The
best part about what we are doing is that, we are not limited to reservations, we can get
the whole country moving in the right direction, but we needed to start somewhere.”
CEOCFO: It’s a
win-win situation!
Mr. D’Arrigo: “It absolutely is, and being apart of
this can sometimes be overwhelming however I know we are making a difference.”
CEOCFO: Where are you
now in actually working on these wells?
Mr. Nanvaan: “Our engineers are currently working with
the Tribe and the individual land owners, analyzing existing data to determine our
strategy moving forward, while we wait for our work-over rig to arrive."
Mr. D’Arrigo:
“The equipment we are waiting for has become a rare commodity; we are expecting
delivery of our rig within the next sixty to ninety days. Until then our team has been
working on locating and leasing up the wells we will be working on. The task of
determining which wells are appropriate for EOR has proven to be tedious and time
consuming, however by taking the time now we will not be wasting money down the road. Not
every well is right for EOR, the experience our guys have is priceless, we are lucky to
have them; any company can try to do what we do; however there is nothing like working
with guys that have, through trial and error, worked out the kinks.”
CEOCFO: How many wells have you identified at this point?
Mr. Nanvaan: “So far we have identified about 30 wells
and are finalizing the leases on approximately 20 of them at the moment. We are only
leasing properties with shut-in wells to be reworked. We are not drilling new production
and do not have a cost of 1.5 or 2 million dollars per well, like other companies do and
not knowing if it is going to be a dry well or a producer. Therefore, we do not have the
risk of drilling dry holes. We are going after production that has proven itself in the
past. There are also about another forty or fifty that we are currently reviewing
out of the two hundred that are on the reservation and surrounding areas. Our company has
established a system. First they go through our exploration department, then they are
passed on to land and leasing. Our land and leasing department contacts the tribe and
landowners to work with them and negotiate the lease. We conclude the lease process and
after that, the Bureau of Indian Affairs at the U.S. Department of Interior signs off and
issues the leases to Native American Energy Group on behalf of the land owners.”
CEOCFO: Will you tell us
about the financial picture of the company?
Mr. Nanvaan: “We have put about two million dollars of
our own money into this company. We have researched and developed for the last 4 years and
spent this fifth year establishing our infrastructure, which includes, building a
management team, hiring engineers and lease acquisitions to date. We are now
looking for money to reactivate these wells and simply extract the oil out of the ground.
We believe that if you believe in a company, you should be able to put your own money into
it before you seek money from the investment community. We have done just that. We did not
wake up one morning and say, you know what, this is a good idea, let’s try to raise
money amongst investors and see if this is a viable business and if it works out, that
would be great. We have put our heart and soul into this for the last five years. We are
now in a position of strength and have established a presence with a conscience.
We are looking for about $3 million in funding to activate about ten wells. With ten to
fifteen wells, we are looking to have an average production of about a thousand barrels a
day. With that, we are look at about $1.8 million per month in gross revenue. After you
pay back royalties for the tribes and minus production costs, we are looking at a million
dollars in net revenue. This is our financial picture, provided we get the $3 million that
we need.
We have received several proposals from a few investment companies and groups, but most of
the people are looking to give a little but take a lot. We have assumed the fiduciary
responsibility for the Native Americans and the tribes as well. We are a for profit
company without a doubt, but with a non-profit approach. That has gotten us very far. We
have a great relationship with the tribes and we look out for them. When somebody comes
and says that they want to help and fund our project, they have also come with offers that
are unethical. We’re looking for a debt structure or even debt with an equity kicker.
Where we have spent five years on this, we can look to spend another five months looking
for the right financial partner. Our company and all its employees are a big family. We
are looking for an investor, or an investment group to come in and be a part of this
family. We are not looking for somebody to just invest in the company and stay blindfolded
while we operate this company. We are offering full transparency; most companies do not
even do that. We fully intend to keep our financial partner updated on the progress and
developments of the company. If a company invests $3 million, they will see where each
penny goes to good use. We have founded this company and assumed full responsibility from
day one.”
CEOCFO: You have been at
this for 5 years; Native American Energy is not new to the industry; does this help in
attracting interest?
Mr. D’Arrigo: “Yes and our persistence have helped,
as well. Whoever participates with us understand that our ultimate goal is to continue
working with the tribes and reinvest in their infrastructure. Eventually the byproduct of
that will be an investment in our country. Among the Native Americans, we are called the
peoples company. They have said that our philosophy can’t be beat, in the sense we
are willing to help them manage their own resources and be an owner in their own right. We
are offering them full discloser and transparency as well. For example, a landowner can
come into our office and give his or her lease or contract number; we would be able to
look it up and give them an update of what was produced to date and how much of a royalty
he or she is due in the mail. That is something no other company was willing to do and
that means a lot to them. We felt that if we could provide a viable service with strong
moral values and at the same time create good revenues for the company we were in a
win-win situation.”
Mr. Nanvaan: We have
also received interest from other tribes as well. They are in the process of sending
us a formal invitation to visit and share with them our philosophy and capabilities. We
are a nationwide bonded company by the U.S. Department of Interior. We are authorized as
of August 15, 2005, to acquire, develop and produce oil and gas on all 562 federally
recognized Tribes in this country.”
CEOCFO: In closing, are
the Native American tribes aware that Native American Energy Group exists?
Mr. D’Arrigo: “Let’s just say the word is
getting around. We are very proud of what we have created here. The people of the Fort
Peck Reservation have opened the eyes of the Native American community. They have already
made a decision to change the way things are done, we are simply a facilitator in this
process.”
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