presentation at bell potter , page-11

Part of the most pesimistic ann. from XEN I could find in relation to Lost Hills:

"XENOLITH GOLD LIMITED 2002-07-31 ASX-SIGNAL-G

HOMEX - Sydney

+++++++++++++++++++++++++
OIL AND GAS

Xenolith holds a small interest in the oil and gas sector through its
6.23% equity in KOB Energy Inc, an unlisted company incorporated in
the USA. KOB Energy's principal shareholder is the Toronto listed
Kookaburra Resources Ltd, which has an 85% equity.

KOB Energy Inc has a 10% interest in four oil/gas prospects in
Mississippi covering approximately 11,187 net acres located in the
interior Salt Basin that is part of the northeastern rim of the Gulf
of Mexico. These prospects remained on care and maintenance whilst
the company focused on the East Lost Hills gas play in California in
which it has a 5.25% working interest.

During the previous quarter, work at the ELH #4 sidetrack ceased and,
during the quarter under review, work also ceased at EL II #9 well
once TD had been reached. The reason given for cessation of work was
that considerable funds were owed to the operator by a number of the
project participants and, until the outstandings were paid, the
operator was not prepared to proceed with testing the ELH #4
sidetrack or the ELH #9 well. KOB Energy Inc was one of the
participants in arrears.

Under an agreement entered into with fellow East Lost Hills
participants, a majority of them agreed to assume responsibility for
KOB EnergyInc's share of outstandings relevant to the ELH #4 well
and sidetrack and the ELH #9 well. They have also undertaken to fund
KOB Energy's share of on-going costs incurred in testing, completing,
equipping and operating the two wells. Those providing the funds will
be entitled to recover 300% of the funds provided on behalf KOB
Energy Inc. However, only income derived from the ELH #4 sidetrack
and the ELH #9 well can be applied to repayment of the 300%
non-consent amount, although KOB Energy Inc retains the right to
repay at any time. The non-consent agreement is specific to the ELH
#4 well/sidetrack and the ELH #9 well and does not apply to future
wells.

Once agreement was reached and outstanding amounts paid in full, work
recommenced at the ELH #4 sidetrack and ELH #9 well, with the intent
being to test both wells. No results are available for publication at
the date of this report, however, progress is obviously slow and one
can only assume that both sites have experienced or are experiencing
operational difficulties. To the best of our knowledge only one coil
is available and it has been required at both sites. Currently the
ELH #4 sidetrack is shut in and the focus is on the ELH #9 well
where, to date, only the Kreyenhagen shale has been perforated.

The Berkley #1 well continues to produce at minimal rates and
production remains restricted by the lack of adequate water disposal
facilities. The East Lost Hillssaga continues!"

XEN had about a 6% interest in a co. who was part of a J.V. drilling there from what I understand.

I've posted this to be balanced: if you read over the previous ann's. from XEN you will find a much more optimistic picture of Lost Hills. Much more optimistic. Not that the release above is pessimistic, as it reflects on the financial and managerial incompetence of the companies concerned, and not the prospects of Lost Hills.

I hope someone who reads the XEN ann's, posts the 'gas flares' ann's, as I'll leave that to someone else and not hog the NEO threads.