History
A tiny shell became an oil and gas explorer through a Utah reverse merger, expanded into Montana, and ended 2017 deregistered with its fate after 2016 unrecorded.
2004-2011: A shell finds a buyer
Hinto Energy, then called Garner Investments, deregistered its securities in October 2004, ending its duty to file reports with the US securities regulator. It was reporting again by 2009, and its auditors raised doubt about its ability to keep going in both 2010 and 2011. At the end of 2010 it had 4,280,000 shares.
In July 2011 majority shareholder Sharon Fowler sold 3,000,000 shares to South Uintah Gas Properties for $300,000, giving it 70.09% of the company. South Uintah held acreage at Natural Buttes, Utah. A deal to acquire it was signed on July 27, 2011. The company was renamed Hinto Energy in September, and in December it issued a $500,000 secured note to Microalloyed Steel Institute, convertible at $1.00 a share.
2012: The South Uintah merger and Utah assets
The South Uintah acquisition closed on January 23, 2012. Hinto issued 11,446,931 shares, 6,700,000 warrants and a $375,000 convertible note. South Uintah returned 2,700,000 shares, which were retired. Several Hinto officers and directors were also officers and directors of South Uintah. Hinto had no production and planned to spend up to $10,000,000 on acquisitions and drilling, to be raised through private placements.
On May 30, 2012 it bought wells and assets in the Greater Cisco area of Grand County, Utah from Pacific Energy and Mining for $325,000: $175,000 in cash and a $150,000 convertible note. The 27 wells needed rework, pipeline connection or offset drilling. In December it settled a lawsuit from Bridge Industries, which had lent money to South Uintah. The settlement cost $100,000 in cash, 1,400,000 shares and 800,000 warrants.
2013-2014: Montana and the big note
In June 2013 Hinto moved into a new area. It bought leases in Musselshell County, Montana, from Jake Oil (559 gross acres) and S&L Energy (722 gross acres), for about $25,000 cash plus a 5% working interest, and $65,000 cash plus 62,242 shares. It also closed a Utah purchase from Pride Ventures and James Woolsey: 4,435 acres, 9 well bores and a gas gathering system, for $75,000 cash and 50,000 shares.
On January 22, 2014 it issued a $2,000,000 secured convertible note at 10%, convertible at $1.25 and secured by the Montana leases and wells. It was the largest financing in the record. In July 2014 an independent study by SanTech Upstream valued the Mason Lake field's reserves at about $3.28 million, with about 14.8 years of remaining life. It put Hinto's working interest at 95%.
2015-2017: Thin funding and deregistration
The record for 2015 is quiet. On March 30, 2016 Hinto agreed to sell 5,000,000 shares for $50,000 to Arrowhead Consulting, controlled by VP of Finance Gary Herick, and 3,000,000 shares for $30,000 to private holders. That was about a cent a share, against roughly 21.9 million shares outstanding. Herick had also lent the company $223,000 over eight months. The share money went to repairing wells in Montana and Utah.
The filings do not say whether the 2014 note, the Pacific note or the Microalloyed note were repaid, converted or defaulted. On March 21, 2017 Hinto deregistered its securities again, ending its obligation to file reports with the SEC. As of that date, its record shows Montana and Utah wells needing repair and no confirmed production figures.
Written from the 14 story beats below (2004 to 21 Mar 2017), which come from the company's own announcements and filings.