200 million barrels per year Crude Oil
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SPECIFICATIONS OF OUR PRODUCT AND ITS QUALITY
Mok manufactures oil components from elemental feedstocks and blends those components to maximize the cracking yeilds at the refinery. This synthetic oil product is absent any sours or bottoms that are typical of oils extracted from the Earth. Olefins, alchohols and other unwanted products typical of earlier synthetic oil manufacturing processes are also absent.
There are essentially no sulfers (<0.01 pct), no phosphorous, no olefins, and so forth. We can match any density and API gravity you wish within a range of 38 to 42. However, we estimate that for most refineries operating today that an API gravity of 38.3 to 38.5 produces maximal value from our product. In describing our product simply, we target Oklahoma sweet as a reference in our manufacturing process, but it should be remembered our product exceeds in quality any oil extracted from the Earth since it hasn't opportunity to absorb a variety of pollutants from overburden during its manufacture and contains at the outset no unwanted components.
DELIVERY TERMS ENVISAGED
All deliveries slated for delivery after the first calendar day of the month is to be delivered by the last calendar day of the delivery month. F.O.B at any pipeline or storage facility with pipeline access to TEPPCO, Cushing storage, or Equilon Pipeline Co., by in-tank transfer, in-line transfer, book-out, or pump-over.
We will begin manufacture of 340 million barrel per year in Nevada starting Spring of 2008. We have arranged to have our product delivered to Cushing Oklahoma via overland pipe at that time and to have the product stored there for physical delivery.
PAYMENT METHODS PREFERRED
Any bankable contract encumbering up to 200 million barrels per year over the four year period from 2004 to 2008, to be delivered between 2008 and 2012 which can then be leveraged by us at bank rates to support project financing is acceptable. We prefer cash but any bankable guarantee will be considered. We expect all commercial buyers to take delivery of the physicals in Cushing Oklahoma and to pay cash for their contracts well before delivery. Since we expect these contracts to rise in value over their term as our project nears completion, we also expect they may be traded prior to that time and there may be a provision in this contract for that eventuality.
A NOTE ABOUT PRICING AND QUANTITIES
Pricing is based upon futures and options prices reported by NYMEX during the construction period. Contract prices for a barrel of oil on the day the contract is sold is easily computed based on scheduled delivery date and futures pricing.
Pre-sold oil contracts are expected to encumber 60% of the output of the finished plant for a period of four years, from 2008 through 2012. A total of 800 million barrels will be presold to pay for construction over this period.
Contracts are 10,000 barrel minimums and are sold for daily delivery starting April 1, 2008. We sell a maximum of 55 contracts per day, then move on to the next day. All contracts are sold on a first come first served basis until our encumbered production from the period 2008 through 2012 is completely sold out.
All contracts sold after April 1, 2008 will be fulfilled the month it is sold and priced based upon NYMEX pricing for Oklahoma Sweet Crude.