Commercial Exposure to Conventional South Texas Gas
The Safari program is underwritten on a disciplined natural gas pricing framework, using a conservative base price of $2.58/Mcf and multiple sensitivity cases to calibrate investor outcomes over a seven-year period.
The focus is on converting known, shut-in reserves into cash flow within an established South Texas midstream and marketing ecosystem, rather than speculating on short-term commodity spikes.
Market Context
The program targets conventional natural gas in South Texas, a mature producing region with established gathering, processing, and takeaway capacity. Production from the Mobil Fee wells is expected to flow into existing midstream infrastructure with direct access to liquid regional markets.
The underwriting approach is intentionally conservative. Rather than building the case on aggressive price assumptions, the base case leverages a moderate gas price of $2.58/Mcf across the seven-year model. Upside and downside scenarios are then layered on top of this base case to evaluate robustness under different price environments.
- Conventional gas in a known, infrastructure-rich corridor.
- Established midstream access and sales pathways.
- Underwriting anchored on conservative pricing, not speculation.
- Explicit price sensitivities captured in the economic model.
Detailed market references and model assumptions are contained in the investment memorandum and on the Model & Sensitivities and Economics Overview pages.
Program-Level Economics (Base Case)
- Price Deck (Base) $2.58/Mcf
- 7-Year Projected Revenue $45,791,698
- 7-Year Projected Gross Profit $25,047,172
- 7-Year Projected Investor Gross Profit (Up to 70% WI) $19,090,087
The figures above reflect the modeled base case and do not guarantee actual outcomes. Price volatility, basis differentials, and operational performance can materially impact realized results.
Price Deck and Key Assumptions
The economic model uses a structured price deck to evaluate cash flows over the seven-year planning period. The Base Case is anchored at $2.58/Mcf, with additional scenarios to illustrate the impact of price movement on investor returns.
| Scenario | Price Assumption (Mcf) | Commentary |
|---|---|---|
| Downside Case | Below $2.58/Mcf | Stress tests cash flows under weaker gas pricing. |
| Base Case | $2.58/Mcf | Primary underwriting case for the 7-year projection. |
| Upside Case | Above $2.58/Mcf | Illustrates incremental impact of higher pricing on revenue and payback timing. |
The model applies these price scenarios against modeled volumes from the Mobil Fee 6 and Mobil Fee 4 reactivations, incorporating decline curves, working interest allocations, and operating cost assumptions.
Full price decks, including year-by-year assumptions, are provided in the Excel model and supporting materials in the Data Room.
Key Modeling Inputs (Summary)
- Modeled production of approximately 17,748,720 Mcf over seven years.
- Working Interest allocation of up to 70% to investors.
- Operator alignment through retained WI and operational control.
- Standard operating cost assumptions for South Texas conventional gas.
Assumptions are subject to change and refinement as additional field data and commercial information become available.
Illustrative Price Sensitivity Snapshot
While the full model includes detailed sensitivities, the directional impact of gas pricing on investor outcomes can be summarized conceptually as follows. As pricing improves relative to the base case, both cumulative cash flow and payback timing improve; when pricing softens, the reverse is true.
| Scenario | Relative to Base ($2.58/Mcf) | High-Level Impact |
|---|---|---|
| Downside | Lower gas pricing | Reduced total returns; extended payback period. |
| Base Case | Modeled at $2.58/Mcf | Supports projected $45.8M revenue and $19.1M investor gross profit over seven years. |
| Upside | Higher gas pricing | Enhances overall NPV and IRR; potential for accelerated capital recovery. |
Exact IRR, NPV, and payback figures by scenario are available in the detailed model and are best reviewed in the context of the full assumptions set.
How Investors Should Use the Pricing Work
- Validate that the base case aligns with your internal price view.
- Review downside and upside cases for resilience and potential optionality.
- Overlay your own commodity curves and risk appetite on the Safari model outputs.
- Discuss assumptions with your internal technical and investment committees as needed.
Safari Production Company, Inc. can walk qualified investors through the model, pricing assumptions, and key sensitivities upon request.
Commercialization and Sales Pathways
Production from the Mobil Fee wells is expected to move through existing South Texas midstream infrastructure, enabling sales into established marketing channels. The commercial strategy emphasizes reliability of offtake and alignment of contract structures with the timing and profile of field production.
- Utilization of existing gathering and processing infrastructure where possible.
- Standard gas sales contracts with recognized counterparties.
- Focus on operational uptime and volume reliability to support marketing.
- Ongoing optimization of contract structures as field data and volumes mature.
Additional detail on facilities, tie-ins, and field operations is provided on the Operations & Facilities and Midstream & Infrastructure pages.
Next Steps for Market & Pricing Diligence
- Review the Market & Pricing overview and base-case assumptions.
- Access the detailed Excel model and price decks via the Data Room (post-NDA).
- Overlay your internal commodity outlook and funding parameters on the Safari model.
- Align on structure, sizing, and timing with Safari.
This page is illustrative and does not constitute a guarantee of future prices or performance. All projections are subject to change.