Business of Consolidated Oil & Gas, Inc.
We explore for and produce oil and gas that we sell to oil and gas gatherers. The gas sometimes is sold directly to the public utility companies. We do our exploration with working interest partners and oil and gas companies that wish to invest in the oil and gas business. A working interest partner buys a percent in a project or well and receives a share of the monthly net revenue of that well (gross revenue less royalties, taxes and operating expenses) based on his percentage of ownership in the well or project. If a well experiences a net loss for a month, a working interest partner is billed for his percentage share of the costs of operating the well in excess of the revenues received. In all of the projects we have, we are the operating working interest partner and the other working interest partners have no involvement in the management of the well or project. The working interest partner receives a recordable assignment for his share of the well or project. The share of revenues and expenses of the working interest partners is not included in the revenue and expenses of our company.
