Ann: Grieve EOR Project Progess Report , page-14

A good report and what i was expecting to be included in the quarterly last friday.

Fact - Surtek, experts in the field, have conservatively estimated about 15mill barrels recoverable.

Fact - We know the oil IS in the muddy cause we extract it on a daily basis albeit it on low volume due to its under pressurised state.

Therefore the final box to be ticked, the $20mill in phase 1 development funding remains the critical sp driver.

We all know the story of the boy who cried wolf and the ELK has been guilty of crying out a few such times. @21 cents the market is indicating it is tired of and lacks any faith in the Grieve EOR project... or more specifically any faith in managements ability to fund the project. However as we know the wolf finally shows up and all hell breaks loose so hopefully this is what we can expect as investors.

Naturally i hope we can maintain 100% of the project but JV outcomes could also be very favourable.

Joint venture scenario - Using ELK's presentations as a guide ELK are willing to JV 50% of the project. If this is the case i would want to be fully carried. Is this realistic? Possibly. Using the same presentation ELK expect full field daily recoverable oil volumes of 5,300bopd. 2,650bopd to the JV participant @$80 = gross revenue of $212,000 per day. Initial outlays would be recoverable and surpassed quickly as production is ramped up to these volumes. ELK being fully carried would receive $212,000 per day NET ... basically realising our current market cap in 1 quarter.

Go ELK.