EAST TEXAS DRILLING REPORT

DEVELOPMENTAL

Harrison County

The Timmins Gas Unit Well No.3HR will be drilled 3.6 miles west from Elysian Field in the Carthage, North (Bossier Shale) Field by Penn Virginia Oil & Gas, L.P. This well will bottom at 14,000-feet in the Findley, J Survey, A-247.

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Exco Operating Company, LP will drill the Walling Gas Unit Well No.1 H in the Carthage, North (Bossier Shale) Field. This well will bottom at 14,000- feet 2.63 miles north from Waskom in the Walling, J C Survey, A-737. The well may also be drilled in the Waskom (Haynesville) Field.

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Panola County

In a lease 15.8 miles southeast from Carthage, in a Wildcat Field, The Wiener Well No.1H will be drilled by Chesapeake Operating, Inc. This well will bottom at 17,000-feet in the Mimms, S W Survey, A- 449. This well may also be drilled in the Carthage, East (Bossier) Field or the Carthage, North (Bossier Shale) Field.

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Anadarko E&P Company LP will drill the Kyle, Fred Gas Unit Well No.17 and the CGU 21 Well No.22 in the Carthage (Cotton Valley) Field to a depth of 12,000-feet. The No.17 will be drilled four miles southeast from Carthage in the Payne, M Survey, A-526. The No.22 will be drilled 5.5 miles northwest from Carthage in the Liddy, W Survey, A-398.

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Smith County

Southwest Operating, Inc.-Tyler will prepare to drill the Hall Well No.1 in the Lane Chapel, North (Paluxy) Field. This well will be located four miles east from Tyler in the Barret, S Survey, A-105 and will bottom at 7,000-feet. The well may also be drilled in a Wildcat Field.

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Tarrant County

The Brumbaugh Well No.18H and the Carter SE Unit Well No.B 2H will be drilled in the Newark, East (Barnett Shale) Field to a depth of 11,000-feet by XTO Energy Inc. The No.18H will be drilled 4.5 miles northwest from Keller in the Hopkins, E Survey, A- 646. The No.B 2H will be drilled within city limits from Fort Worth in the Pace, D C Survey, A-1245.

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Devon Energy Production Company, L.P. will drill the Lester, Lucille GU Well No.2H in the Newark, East (Barnett Shale) Field. This well will bottom at 9,000- feet in the Ellis, M W Survey, A-489 six miles north from Azle.

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Chesapeake Operating, Inc. will drill the Tech Center Well No.1H, the Edgecliff C Well No.3H and the Edgecliff C Well No.4H in the Newark, East (Barnett Shale) Field to a depth of 9,000-feet. The No.1H well will be drilled within city limits from Fort Worth in the Ramey, R R Survey, A- 1343. The No.3H and the No.4H wells will be located within city limits from Fort Worth in the Hernandez, G Survey, A-753.

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Angelina County

The Ruby Flournoy Well No.1 has been completed seven miles southwest fropm Zavalla in a Wildcat Field. Range Production Co. has completed this well to a depth of 17,911-feet and potentialed 1.958 million cubic feeet of gas when gauged on a 20/64-inch choke.

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Nacogdoches County

The Corgey Well No.1R is located 16.6 miles east from Nacogdoches in the Carthage, North Field. This well was completed by Valence Operating Co. to a depth of 13,605-feet. When gauged on a 10/64-inch choke, the well potentialed 412,000 cubic feet of gas. Production is in the Bossier Shale formation.

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Panola County

The Gary Gas Unit Well No.7H has been completed by Anadarko E & P Company in the Carthage Field. This well is located 0.3 miles northeast from Gary with a depth of 11,600-feet. When gaued on a 91/64-inch choke, the well potentialed 4.820 million cubic feet of gas. Production is in the Cotton Valley formation.

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The Carthage Field has seen the CGU 9 Well No.12 completed by Anadarko E & P Company LP to a depth of 9,500-feet. This well is located 3.8 miles southwest from Carthage and potentialed 835,000 cubic feet of gas when gauged on an adjustable choke. Production is in the Cotton Valley formation.

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When gauged on a 34/64- inch choke, the Cunningham Well No.7 potentialed 1.537 million cubic feet of gas. This well was completed by Classic Operating Company LLC to a depth of 10,455-feet in the Beckville Field. This well is located 3.4 miles west of Beckville with production in the Cotton Valley formation.

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Chesapeake Operating, Inc. has completed the Pace Well No.1H in the Carthage, North Field. This well is located 17.8 miles northeast from Carthage with a depth of 15,772-feet. When gauged on a 22/64- inch choke, the well potentialed 14.080 million cubic feet of gas. Production is in the Bossier Shale formation.

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In a lease 7.4 miles southeast of Carthage, in the Carthage Field, the Ingram 2 Unit Well No.8 has been completed by ConocoPhillips Co. This well bottoms at 9,488-feet and potentialed 581,000 cubic feet of gas when gauged on a 18/64-inch choke. Production is in the Cotton Valley formation.

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The Adams, T.C. Nct-1 Well No.64 HS has been completed six miles northeast from DeBerry with a depth of 14,927-feet. This well was completed by Chevron U.S.A. Inc. in the Carthage, North Field. When gauged on a 20/64- inch choke, the well potentialed 6.441 million cubic feet of gas. Production is in the Bossier Shale formation.

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Rusk County

The Peal Gas Unit Well No.1 is located 5.5 miles east of Henderson in the Minden Field. This well was completed by SandRidge Onshore, LLC to a depth of 10,902-feet. When gauged on a 28/64-inch choke, the well potentialed 1.986 million cubic feet of gas. Production is in the Cotton Valley Consolidated formation.

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Shelby County

The Cartwright Well No.1H has been completed 12.75 miles southeast from Center in the Huxley Field. St. Mary Land & Exploration Co. has completed this well to a depth of 14,700-feet. When gauged on a 40/64-inch choke, the well potentialed 4.515 million cubic feet of gas. Production is in the 6100 formation.