NEW MEXICO AND ARIZONA LAND COMPANY, LLC
"NZ"
"Nothing more powerfully creates heritage than the imaginative use and stewardship of land."
--- Frank Lloyd Wright
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NEW MEXICO AND ARIZONA LAND COMPANY, LLC "NZ"
"Nothing more powerfully creates heritage than the imaginative use and stewardship of land." --- Frank Lloyd Wright
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NZ Minerals, LLCNZ owns close to one million acres of mineral rights spread across northern Arizona, New Mexico, Colorado and Oklahoma. Approximately 305,000 of the 992,000 mineral acres lay under the Navajo Reservations. Over 200,000 acres of mineral rights are under Navajo Allottee Lands in New Mexico. The US House and Senate passed a law in 2002 and President Bush signed into law on February 7, 2002, allowing the previous owners of NZ to transfer the mineral rights under a small New Mexico Reservation (Acoma/Pueblo) in exchange for cash or BLM land exchange valued over $1 Million. This was their “trial balloon” to see if the US government would perfect or “unify” the Indian Reservation’s rights on and below their land… especially where conflicting rights were issued to various parties in the 1800’s. This has been successful and NZ believes that much of these Reservation Mineral Rights will be turned into cash or credits for federal land exchange. This is the most immediate source of value in the mineral rights. Mineral History
1917 On August 18, 1917, a geologist for NZ, Andrew C. Lawson, studied the company's mineral assets in Arizona and New Mexico and formed the following summary results. "The reconnaissance of the Winslow, Holbrook and Valencia districts has yielded negative results, no indications of oil or of any other mineral deposits that would affect the value of the land having been found, except that in the Mesa Verde formation of the extreme westerly townships of the Valencia Tract, coal seams may be found by more detailed search. On the western margin of the Mohave Tract, near McConnico, it is probable that gold placers may be developed, but there is no prospect of other mineral deposits being found in the lands now patented. In the McKinley Tract, the most important deposits are coal seams, which occur on the north side of the broad east-west valley which traverses the tract. An oil sand outcrops for about two miles in the northwest corner of the tract which is worthy of investigation by drilling, although the structural conditions within the limits of the tract are not favorable for the storage of oil. The oil sand outcrop, however established the fact that structural conditions were found in the territory to the north of the tract, oil might be developed. (Approved as a condensed form of my report.)"
1990
In the early 1990s, J.D. Sphar, NZ geologist, reviewed NZ's one million-plus mineral acres: "Certain deposits of natural resources have been delineated over the years on NZ's mineral rights including in order of their discovery: petrified wood, coal, potash, industrial clay, uranium, travertine, oil and helium. Beyond the possible future values from exploitation of these discovered resources, the mineral rights per se also remain intrinsically valuable because of their potential for future mineral discovery. Given the amount of research and exploration to date, the potential for new discovery is more constrained than wide open. Geologic data is relatively sparse and, hence, the potentials for discovery less constrained on the blocks of Indian Reservation minerals." Clay/KaoliniteKaolinite or Klannerite is the trade name for a deposit of highly altered bedrock ("clay") on 80 acres of NZ's mineral estate in Mohave County. The clay has industrial value for white cement and high strength concrete. The ore deposit (Viva Luz Mine) is located in Mohave County, Arizona, surrounded by Bureau of Land Management land in the Warm Springs Wilderness Area.
Klannerite is a hydrothermally
altered tuff; alteration has produced a very The ore deposit has been stripped of overburden and test drilled. Thirteen circulation 5 inch holes completely penetrate the deposit. The holes were sampled on 5 foot intervals, and analyzed by Lakefield Research, Canada. Cross sections were constructed in ACAD and used to calculate tonnage. Ore reserves in short tons have been tallied in this chart:
Mohave County, Arizona: kaolinite mining site
Petrified WoodNZ owns the mineral rights to commercial quantities of petrified wood in both Navajo and Apache Counties, Arizona. Petrified wood resources on NZ Mineral lands occur in a discontinuous band that surround the southern end of the Petrified Forest National Park (PFNP). In general, NZ's petrified wood resources in Navajo County occur on NZ mineral lands, and those in Apache County occur on NZ surface and mineral lands. Historically, NZ has licensed operators to extract and sell petrified wood from NZ mineral lands in Navajo County, but all extraction licenses for operations have since been terminated. Unauthorized extraction activities have also taken place, resulting in damaged and lost petrified wood resources in several areas. There is a strong stratigraphic evidence that certain NZ mineral lands contain significant subsurface resources of petrified wood. Although many of these are not likely to be economically viable at this time, the conceivably are the single richest source of petrified wood on NZ lands, and certainly should be considered in evaluating the value of the mineral rights of these properties. Of particular importance to this study is the proximity of NZ petrified wood resources to the Petrified Forest National Park. In the current political climate, petrified wood resources therefore must be evaluated not only in terms of effort required to extract and market value, but also in terms of public perception of extraction activities. PotashThe first mineral deposit to ever be found on NZ's mineral estate by drilling, was potash. It was found in Arizona southwest of the Petrified Forest National Park. It was discovered in the 1960s following unsuccessful oil exploration drilling that disclosed thick evaporative strata. A creative geologic suggestion was made to look for accompanying potash rings in this evaporative basin setting. NZ and ARKLA thus came to joint venture an exploration program in 1965. The cost of this drilling sent NZ's meager earnings into the red for the first time ever, but NZ's stock (when NZ was a publicly traded company) responded well and soared to reach nearly 40 points in that year. Over the next five years, a deposit was delineated containing 72.8 million tons with a grade of 12.5% K²O. There was good geologic potential to further expand the deposit, but the economics were destroyed with the opening of huge, high grade mines in Saskatchewan. Hundreds of feet of halite (table salt) were encountered in this drilling. No current mineral values are assignable to this potash, but the possibility of using the evaporative section for geologic storage (natural gas, compressed air) brings up the wild card potential for free recovery. In any event, the fact of this discovery lends credence to the always inherent speculative element in owning mineral rights. The following excerpt comes from the Arizona Geological Survey, Circular 30 January 2002, Arizona Has Salt! Written by: Steven L. Rauzi:
OilOil on NZ's lands was widely rumored as early as 1912, but was not produced until 1986, and then as a follow up to a random oil show found in a uranium research core hole drilled for the Department of Energy back in 1982. The resulting "Nose Rock Oil Pool" produced about 60,000 barrels of light, sweet crude before its depletion. Geologically similar small oil pools are possible in the same general vicinity, but exploration costs are difficult to justify for such small oil pools. Elsewhere, all of NZ's other potential petroleum prospects must be classified as rank new basin wildcat. In Cibola County, New Mexico previous wildcat wells contained prolific porosity or permeability. NZ's large mineral holdings in Northeastern Arizona have shown little petroleum promise to date, based upon rather sparse drilling done without the benefit of even two dimensional seismic. Overall, the prospects for new petroleum discovery on NZ's land is considered difficult at best. SaltThe Holbrook Permian Salt Basin is directly under 80,000 acres of fee land and 100,000 acres of surrounding mineral rights holdings of NZ Minerals, LLC. The salt basin is 650' thick. Salt domes are being used to store natural gas, oil, propane, butane and other valuable gases. The following excerpts come from the Arizona Geological Survey, Circular 30 January 2002, Arizona Has Salt! Written by: Steven L. Rauzi:
Each basin is described in detail in Circular 30, Arizona has Salt! "Salt was first reported in the Holbrook Basin in the 1920s when it was encountered by cable tool holes drilled for oil and gas. Rauzi (2000) used 223 wells including 135 wells cored for potash and 88 wells drilled for oil, gas, or LPG storage, to depict the extent and thickness of salt in the Holbrook Basin. Only 29 of the wells were drilled through the entire thickness of salt. Most were drilled into only the upper 100 to 300 ft of salt where potash minerals were present." "Salt in the Holbrook Basin is part of the Supai Formation of Permian Age. The Supai Formation there consists largely of sabkha deposits of red to reddish-brown clayey siltstone and halite interbedded with anhydrite, gypsum, and carbonate."
HeliumThe following article was included in the Summer 2003 volume of Arizona Geology, published by the Arizona Geological Survey, titled: Holbrook Basin: Correlation and Resources by Steven L. Rauzi and Larry D. Fellows. CoalBituminous coal seams are found on NZ's Cibola, McKinley, San Juan, and Navajo Tracts. The coal is believed to be low sulphur, boiler fuel grade. Most of this coal is found on the McKinley Tract where it was early noted in outcrops. (Cleary, Gibson and Dilco coal seams identified.) Reserve estimates of 160 million tons in-place were made from studies of these outcrops. Subsequent subsurface drilling by several experienced coal companies (Peabody and AMAX most notably) refined these early estimates over part of the acreage. NZ enjoyed leasehold income in excess of $300,000 from this coal exploration activity in the 1970s, but no practical coal deposits were ever located. However, a very small strip coal mine -- the Crown Coal Mine -- was actually permitted by Gifford-Hill (now a Hansen company) on the northeastern corner of the McKinley Tract. No dirt was ever moved and this 2 million ton reserve (NZ's reserves, 50 foot overburden) mine was abandoned in 1991 for lack of economics. Nowhere have seams of coal over seven feet thick been located, and typically, the seams are less than three feet. Except for the Crown Coal Mine vicinity, the coals are capped by competent overburden which precludes low cost stripping. Moreover, the surface is in Indian ownership and the area has no close railroad access at present. (Star Lake spur someday). Also, there are over 6 billion tons of thicker, more accessible coals in the regional vicinity. NZ's shallow coal seams, typically dissected by canyons, are not considered prospective for coal seam gas. Some coal seams (Menefee and Dakota) do occur but have nowhere found to be thick enough to sources appreciable amounts of natural gas. The coal occurrences were better defined by drilling in the frantic exploration days of former President Jimmy Carter's "Energy Crisis". One isolated coal deposit of only 2 million tons of strippable coal was actually permitted but never mined. The conclusion of A.I. Levorsen in his report to NZ of June 3, 1953, still holds true today: "At present, this (NZ coal) has little value and probably will not compete normally with other New Mexico and Arizona deposits for some time to come."
References: NZ Railroad Title, 1992; Chronicle of New Mexico and Arizona Land Company, 11-15-91; Historic Land Grant Assets, 6-1-99; Liquidation Values "Historic Assets", 1998.
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