Investment Policy Guideline

1. Objective:

The primary objective of this investment policy is to identify and invest in undervalued oil and gas assets that are currently producing income and possess the potential to generate a minimum return of investment  5X-10X through monthly cash flows over a five year period. The investments will align with a circular business model, focusing on optimizing costs through the monetization of waste streams. The investment strategy will specifically target drilling in P1 wells with a success probability of 90% or higher.

2. Investment Strategy:

The investment strategy focuses on the following key principles:

• Undervalued Assets: Identify assets that are trading below their intrinsic value, offering potential for capital appreciation.
• Income Generation: Prioritize assets that are already producing income, providing a steady revenue stream while the investment appreciates in value.
• Circular Business Model: Embrace a circular economy approach by optimizing costs through the monetization of waste streams generated from the oil and gas operations.
• Sustainable Practices: Evaluate potential investments based on their adherence to sustainable and environmentally responsible practices.
• High Probability of Success: Concentrate on P1 wells with a success probability of 90% or higher to mitigate risk and enhance the likelihood of positive returns.
• Technology: There is a successful application of untested technology or the development of new technology. 
• Operations: We have the ability to operate a field at less cost than the seller.
• Abandonment: The property abandonment is cheaper than the seller's estimated cost and we can repurpose with renewable technology. 

3. Risk Tolerance:

While seeking favorable returns, the investment policy acknowledges the inherent risks associated with the oil and gas industry. The investment approach will incorporate risk mitigation strategies, including thorough due diligence, comprehensive technical assessments, and a diverse portfolio.

4. Investment Criteria: 

Investment decisions will be guided by the following criteria:

• Valuation: Identify assets trading below their intrinsic value, considering market trends and industry benchmarks.
• Income Potential: Prioritize assets with proven monthly income streams to provide consistent cash flow.
• Circular Model: Evaluate investments based on their potential to monetize waste streams and achieve cost savings.
• Sustainability: Consider investments that align with environmentally responsible practices, contributing to long-term sustainability.
• Technical Assessment: Focus on P1 wells with a 90% plus probability of success, minimizing exploration risk.

5. Performance Measurement: 

Performance will be measured against a minimum target return of 20% per annum over the investment horizon. Regular evaluations will assess actual returns against projected returns, considering both capital appreciation and income generated.

6. Implementation: 

The investment policy will be executed by a team of experts with a deep understanding of the oil and gas industry, valuation methods, and sustainable business practices.

7. Review and Reporting: 

The investment strategy and its performance will be reviewed periodically to ensure alignment with objectives. Reports will be generated to provide investors with transparency on the progress and results of the investments.

8. Conclusion: 

This investment policy statement outlines a disciplined approach to investing in undervalued oil and gas assets with the potential for high returns while adhering to a circular business model and sustainable practices. By focusing on income generation, waste stream monetization, and high-probability drilling, the strategy aims to deliver attractive returns while minimizing risk.