Frank E. Acierno - Page 11

                                       - 11 -                                         
          to apply EOR technology to the production of oil from the wells.            
          Drake, like Barton, did not participate in any transactions                 
          involving the lease of tar sands properties from TexOil                     
          International Corp. nor the lease of natural gas properties in              
          the Monroe gas field in Louisiana.  See id. at 150-157.                     
               Drake and the related partnerships, as described in detail             
          in Krause v. Commissioner, supra at 140-143, 152-157, entered               
          into license agreements either with Elektra Energy Corp.                    
          (Elektra) or with Hemisphere Licensing Corp. (Hemisphere) to                
          obtain limited rights to use certain purported EOR technology in            
          the production of oil.                                                      
               General explanatory material relating to the oil crisis of             
          the late 1970's and early 1980's and a detailed explanation of              
          the EOR technology involved herein are set forth in Krause and              
          will not be repeated herein.  See id. at 134-136, 157-165.                  
               The EOR technology licensed by Drake constituted essentially           
          the same EOR technology as that licensed to many of the other               
          related partnerships, including Barton and other partnerships               
          involved in the Krause test case.  Id. at 157-165.                          
               Under the EOR license agreement that was entered into                  
          between Drake and Hemisphere, Drake nominally agreed to pay fixed           
          license fees to Hemisphere of $50,000 per partnership unit per              
          year for 5 years.                                                           
               Drake’s annual $50,000 per partnership unit technology                 
          license fee to Hemisphere was to be paid, during each of the 5              




Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011