Riddle Lease: 250 acresRiddle #7 and #5 Wells: Are completed as...

Riddle Lease: 250 acres

Riddle #7 and #5 Wells: Are completed as producers and were initially producing 30 barrels per day. These wells have been cut back to 5 barrels per day while down hole work is underway.

Riddle #11 Well: Initially produced in excess of 150 barrels per day and has been cut back to 50 barrels per day to conserve formation pressure and so as not to damage the well bore it self.

Riddle #6 Well: Although an oil producer initially, later produced more water than the economics of production allow. The well may have also been producing water into the other levels and this could have been charging water zones in Riddles 7 and 5. This well has now been cemented shut to over come the water problem.
Bulldozers are clearing three new sites north of Riddle #11. These wells will be targeted at the same oil zone as see in Riddle #11.

Stockton Lease: 123 acres

Stockton #6 Well is averaging slightly more than a barrel per day and Stockton #7 approximately 2 barrels per day.

Carter Lease: Approx 600 acres

Production on the Carter lease has declined from the existing wells and now a total amount of less than 4 barrels per day from C1, C3, C6 and C15 is being recorded.
A number of drill targets have been determined from the seismic undertaken on the lease during the winter. It is anticipated that these will also be drilled in July to September. All the wells are targeted at the Granville Formation, which is in the 345 ft range of depths.
The Granville Formation is known to be only a modest producer in the 4 to 8 barrels per day area however they do produce for long periods, some up to 30 years. As their depths are shallow the drilling costs are cheaper.

York Lease: 103 acres

Two wells have been permitted on the York lease. These are Stones River wells with a target depth of approximately 100 feet. These wells will be drilled in the later part of the year subject to success in other leases and the availability of a rig.

Thomas Lease: 51 acres

The Thomas #1 well was drilled to the Knox and had a good oil smell in the cuttings from the Knox. Unfortunately no oil was produced to surface. All work on the well has been put on standby due to the success at the Riddle lease. The well will probably be plugged and abandoned following a basic run into the well to check for any liquid hydrocarbons in the well.

Dyer Lease: (New) Approx 800 acres

The Company has acquired approximately 800 acres in the Allen Creek Road area. The area directly west of this lease has had significant discoveries of oil in the past and the Dyer lease has two old oil producing wells in its eastern sector. There has been 4 other wells drilled in the rest of the lease and as such the lease is considered unexplored. The lease is on what is known as an oil trend and with the size of the lease is a very attractive acquisition for the Company. Exploration on this lease will commence in August to September 2007.

Davis Lease: (New) Approx 220 acres

Acquired in April, this lease has two old production wells on its western edge and two other wells with no shows of oil. There is hearsay evidence of a very significant well nearer to the farmhouse in the early part of the 20th century however there are no actual records. The lease is near Goose Creek where there have been some very large discoveries during the past 100 years. This lease will be reviewed in the latter part of the year to delineate a drilling target.

Possible New Leases:

The Company is presently negotiating with three farmers for a lease on their properties. (Preston Riddle 600 acres plus, Rush 270 acres and Shepherd 450 acres). These negotiations are almost complete and will add a further 1300 acres (approximate) to it portfolio bring it to almost 3500 acres. Other leases are only at the first contact stage and are not included in this summary