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Show The National Enterprise , September 1, 1976 Page eleven Higher Drilling Fund Expands MGF Participation million. The $8.3 million in turn Tex. MGF Oil Corp. (OTC 4.75, 5.25) expects its 1976 drilling programs to participate in 40 to 45 wells as a result of the successful recent closing of $13.9 million in drilling funds, president R. 0. (Jack) Major told securities analysts and dealers in Dallas Tuesday. It is anticipated that the majority of the 1976 drilling program will be expended on DALLAS, was substantially higher than the $4.46 million in total capital of the 1974 program. Major said. He added that the increase in gross profits from oil and gas sales for the six months ended June 30, 1976, to $827,000 from $348,000 in the same period last year, an increase of 138 percent, can be attributed in large part to success of the 1975 drilling program. In the 1976 program, Major said, MGF will receive approximately 32 percent of the program's oil and gas revenues for its investment as general and limited partner. Major also announced that the company has acquired an option to purchase, subject to board approval, 200,000 shares of its common stock from Fred Forster Jr., a substantial acreage holdings in Frio, Bee and Dawson Counties, Texas, and Marshall County, Okla. he said. The company recently announced the closing of its final 1976 drilling program, MGF 76-Ltd., with limited partner subscriptions of B, $5,517,000 including $137,000 from MGF as a limited partner. In addition, MGF has committed approximately $867,000 as general partner. This brought the total limited partner subscriptions of both programs, MGF 76-Ltd. and MGF 76-Ltd., for the year to a fully subscribed A, B, $12 million. MGF additionally committed $1.9 million to the combined program as general partner, bringing total capital of both programs to approximately $13.9 million. This compares to a total of $7.6 million from limited partner rffe&tfiHb we Grab Samples Here s to Nevada &Ate, hmseh&s- - fc7W Mineral exploration in Nevada is big and is likely to grow even more because of the Silver States ideal location. This is how Enfield B. Bell, district exploration manager and of Freeport Exploration Co., views the future of Nevada prospecting. There is a tremendous influx of foreign companies in the state now," Bell says. It has been caused by the free enterprise economy of the United States. The 49 year-ol- d geologist said high taxes in foreign countries have forced U.S. companies to move home again. Canada has taxed mining right out of business, he said. As foreign and domestic companies began filtering into the U.S., Nevada seemed the most attractive state for exploration. It continues to occupy that position. Nevada is a big state with favorable mining regulations and low mining taxes which attract companies from all over the world. But economics is not the only reason modern prospectors are making the move. The main reason Nevada We rates over the other states is population, Bell says. have less population, fewer problems with environmentalists, fewer problems with land acquisition and it is If people must be relocated, it is easier in accessible. Nevada than in other states. Bell also sites the basin and lange topography of Nevada as favorable for exploration. There is still a lot of opportunity for prospecting in a state like Nevada. Geologically, it is a good place to look. He says the state is The basins. d mountains and about looked at the 30 sticking up out of the ground. He said with the We can look effectively at another 20.help of technology, geologists can now look at pediments sloping areas on the sides of mountains that were not easily accessible to Nevadas miners of the 1800s. Modem mineral prospectors look at Nevada differently than did Comstock were looking for only high grade miners. Whereas ores, prospectors today can afford to look at lower grade ores vice-preside- nt two-thir- one-thir- ds old-time- rs - by Norman Lamb old-time- rs subscriptions in 1975 plus approximately $700,000 from MGF as a general partner for total 1975 capital of $8.3 principal shareholder and board member. The purchase price of $5 per share would be paid in five equal annual installments, plus interest at 8 percent per annum on the unpaid balance, beginning by January 1977. The shares, representing 9.5 percent of the total outstanding, are to be retained as treasury stock for possible future use for corporForster reate purposes. signed from management of MGF in December 1975 to devote full time to private investments. that can be mined in bulk. We are looking for major ore bodies, Bell says. In the old days, they did not have drills The modem prospectors so they did not worry about it. his than tools are better predecessors, yet they are still much alike. The Number 1 tool we use is ideas, Bell said. We try to hire people who can generate new ideas in old mining districts. We go into ghost towns in Nevada and see if we can generate new ideas. We follow up on ideas others generate. Once the ideas have been studied in an office, the modern prospector goes out in the field, just as the did. Anyone in the exploration business spends 50 of his time in the field. The modem prospector still has to get on the ground and break rocks if he is to determine if there are any mineral deposits. We do not go out in the field carrying a lot of complex equipment. The prospector of today does rely on some new techniques though. Geochemical sampling can trace Electrical instruments can be used amounts of minerals. Bell explains. He to interpret various measurements, says these processes are used when you assume you have got a target you need to test. According to Bell, drilling to actually see what is in the ground at a given location is used only as a last resort because of its expense. Mineral exploration is a touchy and risky business, The according to the Reno based mining executive. chances of finding ore are extremely slim. It is a horseback guess on what you think it might be. He said he will usually go to more expensive prospecting techniques if there is at least a 1 in 100 chance an ore deposit might be in a given area. In the exploration business, you are lucky if you find one ore body out of 100 prospects you drill. Ah!, but when old-time- rs you do ... . Norman Lamb is the author of Small Fortunes in Penny Gold Stocks , its Supplement and of Gold Fever, the co-creat- or California Gold Rush Game. |