December 30, 2005
via U.S. Mail
Lynn Petersen
President and Chief Executive Officer
Kodiak Oil & Gas Corporation
1625 Broadway, Suite 330
Denver, CO 80202
Re: Kodiak Oil & Gas Corporation
Amendment No. 1 to Registration Statement on
Form 20-F
File No. 0-5163
Filed November 30, 2005
Dear Mr. Petersen:
We have reviewed your amended filing and have the following
comments. Where indicated, we think you should revise your
document
in response to these comments. If you disagree, we will consider
your explanation as to why our comment is inapplicable or a
revision
is unnecessary. Please be as detailed as necessary in your
explanation. In some of our comments, we may ask you to provide
us
with information so we may better understand your disclosure.
After
reviewing this information, we may raise additional comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or on any other
aspect
of our review. Feel free to call us at the telephone numbers
listed
at the end of this letter.
General
1. The Form 20-F registration statement will become automatically
effective 60 days from the date of the first filing or on January
22,
2006. See Section 12(g)(1) of the Securities Exchange Act of
1934.
Upon effectiveness, you will become subject to the reporting
requirements of the Securities Exchange Act of 1934, even if we
have
not cleared all comments. As this is a voluntary filing, you may
withdraw the filing so that it does not become effective in a
deficient form. Please contact us if you need to discuss this
alternative.
2. In your amendment to the registration statement, include
information as up to date as possible. We refer you to General
Instruction C (b) of Form 20-F, which states that "[U]nless an
item
directs you to provide information as of a specific date or for a
specific period, give the information in a registration statement
as
of a date reasonably close to the date of filing the registration
statement..." For example, update the information pertaining to
the
high and low exchange rates as of the last practicable date and
for
each month during the previous six months. See Item 3.A.3 (a) and
(b) of Form 20-F.
3. Consistent with the requirements of Item 19 of Form 20-F,
please
file all required exhibits with your next amendment. In this
regard,
we note that you have not filed any of the agreements delineating
the
acquisition of and terms relating to the working interests you
have
obtained with respect to the properties referenced in the
registration statement. We may have further comments upon our
review
of such exhibits.
Note Regarding Forward-Looking Statements, page iii
4. Given that your stock is deemed a "penny stock" as defined by
Rule
3a51-1 of the Securities Exchange Act of 1934, please remove all
references to the Private Securities Litigation Reform Act of 1995
in
your first paragraph in this section as the safe harbors contained
in
that Act are not available to you.
Item 3. Key Information, page 1
Capitalization and Indebtedness, page 3
5. Please provide the information required by Item 3.B. of Form
20-F.
Moreover, we note the recent announcement of a private placement
of 7
million shares in which you raised proceeds of approximately CDN
$9.8
million. Please include such updated information in this section.
Risk Factors, page 15
6. Most of your risk factors could apply to any company in any
industry. Even those that are exploration specific are very
generic.
You should only cite risks that are particularly relevant to you
and
your disclosure should make clear how the risks impact you
specifically. Delete "boilerplate" risks and explain how the
others
impact you.
7. We note that the Company is authorized pursuant to its
constitutive documents, to issue an unlimited amount of shares.
Provide a risk factor that delineates this fact and specifies the
number of financings that the company has engaged in within the
past
fiscal year. Further, to the extent material to your ability to
fund
operations, discuss your plans to use equity financings to fund
future operations and the impact this will have on
securityholders.
8. Please group your related risk factors together under
classified
headings such as risks related to your industry and risks related
to
your company.
"We are dependent on our executive officers...," page 7
9. Rather than stating that you are dependent on "certain" key
officers and directors, identify the officers and directors you
are
referencing.
Item 4: Information on the Company, page 9
Business Overview, page 10
10. Please revise to provide the disclosure required by Items
4.A.5
and 4.A.6. In this regard, please revise the table on page 10 to
indicate actual expenditures as of the most recent practicable
date.
11. The table on page 10, does not reference expenditures made in
the
Pacific Isle Coalbed Methane Gas Unit in the Greater Green River
Basin. You indicate on page 13 that activities with respect to
this
project occurred during 2005 and led to the generation of revenues
from gas sales. Please revise the table to reference the amounts
expended with respect to what appears to have been a material
project
to your business during 2005 or advise us of why such a revision
is
unnecessary.
12. Provide disclosure regarding the seasonality of your business.
See Item 4.B.3 of Form 20-F.
13. Provide the information required by Items 4.B.6 and 4.B.7 of
Form
20-F. In this regard, we note that you only recently began the
sale
of gas. Please indicate the percentage of sales attributable to
any
one customer if material to an understanding of your dependent
relationships. Also, you reference on page 13, your use of the
Questar pipeline to which a 3 mile pipeline from your production
facilities connects. Provide further disclosure regarding the
dependence on your future and current operations, on access to
pipelines.
Property, Plant & Equipment, page 12
14. Please file the agreements that provide you with the working
interests in the properties referenced in this section.
Item 5. Operating and Financial Review of Prospects, page 16
15. Revise the disclosure throughout this section to identify in
greater detail the principal reasons for changes in your results
of
operations from period to period. For example, rather than
stating
that increased loss for the six months ended June 30, 2005 versus
the
six months ended June 30, 2004 was the result of the "increased
level of activity" clarify for investors the "activity" you are
referencing, the purpose for the increase, and the projects
impacted
by the increased level of activity.
16. In your discussion of periodic results, indicate for each
period
the amount of expenses specifically attributable to exploratory
activities. If none, so indicate.
Operating and Financial Review and Prospects, page 16
Overview, page 16
17. You state that you use a conversion factor of 7 MCF of natural
gas to one barrel of oil to achieve a common unit of measure.
However, this appears to be inconsistent with your disclosure in
Note
2(c) to your consolidated financial statements, which indicates a
conversion factor of 6 MCF of natural gas to one barrel of oil.
Please correct this inconsistency and, if necessary, make other
corresponding changes where the incorrect conversion factor is
used
or affects other amounts.
Operating Results, page 17
Six months ended June 30, 2005 as compared to the six months ended
June 30, 2004, page 17
18. Indicate the property from which you received your first oil
and
gas revenues. Further, supplement your disclosure to provide the
basis for your belief that such revenues will continue to increase
during fiscal year 2005 and in future periods.
Liquidity and Capital Resources, page 18
19. Please revise and provide the detailed disclosure required by
Item 5.B. of Form 20-F. For example, delineate the series of
financings that you have been party to during the fiscal year.
Update your disclosure to reference current developments as of the
most recent practicable date, that impact your liquidity. In this
regard, we note the recent closing of a CDN $9.8 million private
placement. Specify your material commitments for capital
expenditures as of the end of the last fiscal year and most recent
interim period. Revise your disclosure accordingly.
20. You indicate that your working capital would be sufficient to
fund operations through December 31, 2005. Please update your
statements and expand your disclosure as follows:
* Explain whether you plan to incur expenses for anything other
than
general and administrative activities in the near term;
* Explain your current plans for obtaining additional funds and;
* Describe the impact on your financial position, result of
operations and liquidity in the event you are not able to raise
additional funds. See Item 5.B.1(a) of Form 20-F.
Item 6-Directors, Senior Management and Employees, page 19
Directors and Senior Management, page 19
21. Please include in the table, a brief description of each
director
and/or officer`s principal functions and areas of expertise within
the company. See Item 6 A.1 of Form 20-F.
22. Please provide a complete biographical sketch for each named
individual for the past five years. For example, we notice gaps or
ambiguities with regard to time and biographical information in
the
sketches for Messrs. Graham, Knutson, and Catlin.
Report and Financial Statements
General
23. Please paginate your consolidated financial statements
included
in your filing.
Consolidated Statements of Operations and Deficit
24. We note that you classify depreciation expense as a component
of
"Other items" in your 2004 audited financial statements, although
it
appears the depreciation is associated with your business
operations.
Your presentation appears to be inconsistent with the
corresponding
information in your subsequent interim financial statements, in
which
you classify depreciation expense as part of "Costs and Expenses."
Please adjust your presentation to eliminate any inconsistencies
and
appropriately classify your depreciation expense.
Interim Consolidated Financial Statements
25. Please identify your interim consolidated financial statements
and related notes as being those of a development stage
corporation,
consistent with your audited financial statement presentation.
26. Although you disclose differences between Canadian and United
States generally accepted accounting principles in your audited
financial statements, it appears that you have omitted similar
disclosures from your unaudited interim financial statements.
Please
comply with the labeling and reconciling provisions of Item 17(c)
of
Form 20-F.
27. Please eliminate the duplicate set of interim consolidated
financial statements.
Closing Comments
As appropriate, please amend your filing and respond to
these
comments within 10 business days or tell us when you will provide
us
with a response. You may wish to provide us with marked copies of
the amendment to expedite our review. Please furnish a cover
letter
with your amendment that keys your responses to our comments and
provides any requested information. Detailed cover letters
greatly
facilitate our review. Please understand that we may have
additional
comments after reviewing your amendment and responses to our
comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment decision. Since the
company and its management are in possession of all facts relating
to
a company`s disclosure, they are responsible for the accuracy and
adequacy of the disclosures they have made.
In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:
* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;
* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
In addition, please be advised that the Division of Enforcement
has
access to all information you provide to the staff of the Division
of
Corporation Finance in our review of your filing or in response to
our comments on your filing.
You may contact Don Delaney at (202) 551-3863 or Karl Hiller,
Accounting Branch Chief at (202) 551-3686 if you have questions
regarding comments on the financial statements and related
matters.
Please contact Mellissa Campbell Duru at (202) 551-3757 with any
other questions.
Sincerely,
H. Roger Schwall
Assistant Director
via facsimile
Randall Jones, Esq.
Dorsey & Whitney LLP
(206) 903-8820
??
??
??
??
Mr. Petersen
Kodiak Oil & Gas Corporation
December 30, 2005
page 7
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-0405
DIVISION OF
CORPORATION FINANCE
MAIL STOP 04-05