EXHIBIT 10.9
Natural Resource Group, Inc.
0000 Xxxxxxxxxx #000, Xxxxx Xxxxx, Xxxxxxxx 00000
January 6, 2003
Xx. Xxxxx X. Xxxxx
President/CEO
Skyline Resources, Inc.
0000 Xxxxxxxxxx #000
Xxxxx Xxxxx, Xxxxxxxx 00000
Phone: 000-000-0000
Fax: 000-000-0000
Re: Pipeline Construction
Cal Bank Draw/Xxxxxx Dome
Moffat & Routt Counties, Colorado and Carbon County, Wyoming
Dear Xxxxx:
This Letter Agreement is intended to outline the general terms and conditions
under which Natural Resource Group, Inc. (NRG) shall raise funds and construct a
six inch, sixteen mile pipeline, at the request of Skyline Resources, Inc.,
(Skyline) for the purpose of transporting natural gas from the above caption
prospect, to a Questar transportation line in Baggs, Wyoming.
It is hereby acknowledged that Skyline is the operator of the above captioned
prospect and currently owns a 66.66% interest in the same. To date Skyline has
drilled or caused to be drilled several xxxxx that have proven the existence of
natural gas in the prospect area. Skyline hereby authorizes and grants NRG the
exclusive right to raise private investor funds and construct a 6 inch sixteen
mile natural gas pipeline that will originate in the prospect area and join a
Questar transportation line in Baggs, Wyoming. Currently it is estimated that
the cost to construct the pipeline is approximately $1,631,574. Further, Skyline
hereby agrees to exclusively designate the transportation of its natural gas
through the newly constructed line. The gas will then be sold to Questar at a
rate to be determined at the time of sale of said natural gas.
It is further acknowledged that NRG has begun efforts to raise funds from
private investor sources in order to pay for the construction of the
aforementioned pipeline. It is hereby agreed that investors for the pipeline
will be promoted by NRG on a 1/3rd for a 1/4 basis resulting in a 25% carry in
favor of NRG. Further, it is hereby agreed that upon completion of the pipeline
Skyline will be charged .50 cents per mcf for transportation of its natural gas
through the pipeline until such time the entire capital investment for the
construction of the pipeline has been completely returned to the investors
(payout). Subsequent to payout of the pipeline, Skyline will be charged .25
cents per mcf for transportation of its natural gas through the pipeline.
Further, NRG shall have the right to operate the pipeline and/or the right to
appoint an operator for the pipeline upon its completion and prior to completion
of said pipeline, a mutually acceptable operating agreement will be executed by
parties.
If the foregoing general terms and conditions meet with your approval please
sign and return one copy of this Letter Agreement to me at your earliest
possible convenience.
Letter of Agreement executed this 6th day of January 2003.
NATURAL RESOURCE GROUP, INC. SKYLINE RESOURCES, INC.
/s/ Xxxx X. Xxxxx /s/ Xxxxx Xxxxx
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Xxxx X. Xxxxx, President Xxxxx Xxxxx, President/CEO
