DALECO RESOURCES CORPORATION

DALECO RESOURCES CORPORATION

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Company Overview
Daleco Resources Corporation, with headquarters in West Chester, Pennsylvania, is a publicly traded natural resource company with two operating divisions-oil and gas and minerals. The company was originally incorporated in Toronto in June 1966 as Westland Copper Mines, Ltd., which was formed to conduct mining activities in Canada. As a result of a series of ownership changes between 1966 and 1974, the Company’s name was changed to United Westland Resources Ltd., and domiciled in Vancouver, British Columbia. In September 1976, after acquiring control of some oil and gas properties in the United States, the company was restructured with a U.S. subsidiary, Westlands Resources Corporation, to conduct oil and gas operations in the United States. In May 1986, United Westlands Resources changed its name to Daleco Resources Corporation.
The company’s oil and gas division has interests in more than 65 producing wells in various US states. Daleco, through its wholly owned subsidiaries, Westland Resources Corporation, DRI Operating Company, Deven Resources, Inc. and Tri-Coastal Energy, L.P., owns and operates oil and gas properties in the States of Texas, West Virginia, Oklahoma, Alabama and the Commonwealth of Pennsylvania. Daleco does not refine any crude oil or market, at retail, any oil or petroleum products and all of Daleco’s drilling activities are performed by independent drilling contractors on a contract basis. The company’s objective for the oil and gas division, is to expand its holdings through the acquisition of producing properties and through the company’s participation in drilling opportunities.
Tri-Coastal Energy has interests in 29 vertical and horizontal wells that produce from the Austin Chalk formation in east Texas and 35 wells in several counties of Oklahoma. Westlands Resources operates 25 of the Texas wells, while several industry partners operate the remaining wells in both states. DRI Operating Company operates and/or has interests in 11 wells in the States of West Virginia and Pennsylvania. Eight of the wells, six in West Virginia and two in Pennsylvania, are producing from the Lower Devonian-aged Oriskany Sandstone at depths between 8,000′ and 9,000′. Deven Resources, Inc. (“DRI”) is the general partner of Deerlick Creek Royalty Partners, a limited partnership, owning overriding royalty interests in 60 wells located within the Deerlick Coalbed Methane Field near Tuscaloosa Alabama. Coal bed methane (CBM) is simply occluded methane found in coal seams.
The company’s minerals division holds properties located in New Mexico, Texas and Utah. The company’s kaolin and zeolite properties in New Mexico and Texas, respectively, are undergoing geologic definitions as the basis for scoping studies. A scoping study on the company’s calcium carbonate properties in New Mexico has been prepared and efforts are being made to establish venture relationships to develop this property. The objective of the company’s mineral division is to expand its holdings through the acquisition of projects and/or companies that can offer synergies with the development of its existing mineral properties. The mineral activities of Daleco Resources Corp. (DRC) are conducted through its two wholly owned subsidiaries, CA Properties, Inc, (CAP) and Clean Age Minerals, Inc. (CAMI).
Business Summary
Daleco Resources Corporation is a natural resources holding company whose subsidiaries are engaged in the exploration, development and production of oil and gas; the exploration for naturally occurring minerals; the marketing and sales of such minerals, and the marketing and sales of products utilizing the Company’s minerals. The Company’s wholly owned subsidiaries include Westlands Resources Corporation, Deven Resources, Inc., DRI Operating Company, Inc., Deerlick Royalty Partners L.P., Tri-Coastal Energy, Inc., Clean Age Minerals, Inc., CA Properties, Inc., Sustainable Forest Industries, Inc. and The Natural Resources Exchange, Inc. The Company, through its wholly owned subsidiaries, Westland Resources Corporation, DRI Operating Company and Deven Resources, Inc., owns and operates oil and gas properties in the States of Texas and West Virginia.
Description and history
Daleco Resources Corporation, incorporated on April 17, 1978, is a natural resources holding company whose subsidiaries are engaged in the exploration, development and production of oil and gas; the exploration for naturally occurring minerals; the marketing and sales of such minerals, and the marketing and sales of products utilizing the Company’s minerals. The Company’s wholly owned subsidiaries include Westlands Resources Corporation, Deven Resources, Inc., DRI Operating Company, Inc., Deerlick Royalty Partners L.P., Tri-Coastal Energy, Inc., Clean Age Minerals, Inc., CA Properties, Inc., Sustainable Forest Industries, Inc. and The Natural Resources Exchange, Inc. The Company, through its wholly owned subsidiaries, Westland Resources Corporation, DRI Operating Company and Deven Resources, Inc., owns and operates oil and gas properties in the States of Texas and West Virginia.

As of September 30, 2009, the Company owned working interests in 28 wells in the States of Texas and West Virginia. The Company also owned royalty interests in 70 wells in the Deerlick Coalbed Methane Field, Tuscaloosa, Alabama, through Deerlick Royalty Partners L.P. Clean Age Minerals, Inc., through its subsidiary, CA Properties, Inc. (collectively CAMI), owns fee interests, leasehold interests and federal mining claims containing non-metallic minerals in the States of Texas, New Mexico and Utah. The Company does not refine or engage in retail sales of any petroleum products. All of its production is sold to a range of customers, which include pipelines, oil and gas gathering companies and other purchasers.

Through September 30, 2009, the Company mined approximately 1,300 tons of material for the preparation of samples and test products. Approximately 70 tons have been sold or distributed as the Company’s trademarked ReNuGen, a zeolite based, wastewater treatment product. During the fiscal year ended September 30, 2009 (fiscal 2009), approximately 20 tons were sold for use in certain agricultural oriented products. As of September 30, 2009, the Company was not conducting any exploration activities on Three Creek zeolite deposit. The Company has 17 placer mining claims covering approximately 2,720 acres and eight lode claims covering approximately 160 acres covering a portion of its existing holdings. The Company has maintained all of its claims during fiscal year 2009.Through September 30, 2009, the Company did not produce commercial quantities of its Sierra Kaolin.

The Company’s Texas properties are located in the Austin Chalk Trend. The Austin Chalk Trend consists of the Austin Chalk, Buda, Georgetown and Edwards formations, extends for approximately 300 miles in length and 50 miles across, and is encountered at depths of 5,500 to 18,000 feet. The Company’s hydrocarbon production in the State of West Virginia is in the producing zone of the Oriskany formation of the Appalachian Basin’s Upper Devonian Section. The Company has working interests in two wells in West Virginia, for which it acts as operator. The Company owns royalty interests in two wells, as well as certain undeveloped acreage in the Commonwealth of Pennsylvania. Deerlick Royalty Partners, L.P. owns an overriding royalty interest in the Deerlick Creek Field, Tuscaloosa County, Alabama, in the Black Warrior Basin. The Company’s zeolite deposit is located 29 miles south of Marfa, Texas.

Originally incorporated in Toronto as Westland Copper Mines, Ltd., which was formed to conduct mining activities in Canada

Business Line
A publicly traded natural resource company with two operating divisions-oil and gas and minerals
Subsidiary

Advisor
VASQUEZ & COMPANY LLP
IPO date
8/18/1995
US SIC Code
1311
Company Address
5th Floor
17, Wilmont Mews
City province or state postal code
19382, WEST CHESTER, PA
Phone: +1 610 429 0181
Fax: +1 610 429 0818
Country address: UNITED STATES OF AMERICA
Website url: www.dalecoresources.com