Ann: Napoleonville Farmout Completed , page-18

Gents

I think your all wrong. GGE needs to monetise the Napville lease to gain further interest as a prospect or to sell the lease. Or maybe farmout and retain a royalty. The hint seems to be in BETTER seismics. The folks at GGE and GGP and Waterloo know there is product there but seemed
to have relied upon the previous Drillers, and the now becoming, outdated seismic data. New technologies are improving the returns to the oil companies. Saltdomes are notorious but maybe this new partner has technology to improve the hit rate. Maybe less wells but better hits. Those sorts of things dont sit well with impatient s/h as we all expect more drilling and more wells to be the hallmark of a successful company.

Considering the excitement in shale oil/gas in the US these types of leases (Napville) will be seen as uncommercial unless there is a better strike rate. Is that strike rate better from number of wells or more targeted drilling?

The question on managements lips would be how to improve s/h benefit. Tier up into oil/gas plays like Abita, La Posada with more frequent wells but more likelyhood of success. Or cashburn/less drilling the wells in Napville. NOTE: Desiree is NOT included in the farmout. They seem damn certain about Desiree but hesitant on drilling it. Possibly because it will come into play as insurance in the farmout.

Taking cash for La Posada and farmingout Napville tells me that GGE has ambitions to move up the scale.

About time. This stock needs a rewrite in value because its thinking as management is starting to mature as its not filling a void but creating a niche. Building royalties into its cashflow is IMO a sign of maturity.

Go 2012 for GGE.

T1