reasons for a bounce

Well well, buzz buzz...and buzz words! Gee...energy.


Hi all shareholders and recent bailers.

I have been discussing almost every facet of MAE that i possibly could with one party today and i hope to bounce that discussion off Peter and Jeff tomorrow. There is no room for emotion here now, the NEW facts will be our most useful tool in realising true value and position/risk.

Some of the highlights we have come up with are these and you may be surprised if you discuss some of it with qualified opinions:

1) Shareprice overreaction based on an unfamiliarity with Gas Company valuation models and dynamics; the likelihood for those figures to improve quickly and vastly (ie by up to 300% in the short term but by an average of 100% in a partially recovered market, potentially before final 1/4 2009).

2) The moving gas valuation model has which is what we have been valued on is only as accurate as the price/moment it is calculated in and we are at the bottom valuation at present which is not an indication of our "Market Value" considering unrated reserves.
The ousted data (due to a low gas price) is almost as low as it can get, or rockbottom if you will - that data will just as quickly become re-included in our future value and new ratings will be inflated by grades moving from uneconomical to economical. An additional footnote would cover this in the report for scalar diligence to be fulfilled and for the mitigative responsibility by management towards the creation of a fair market pricetag and what is in the best interests of chareholders value.
Refer to the principles behind Moving Averages and note the way those averages rise and fall. So too does a companies gas value, yet not everyone has an official value done and is caught with their pants (sudden gas price drop) down at the worst poissible time just as the results are released. The gas market timed its BTU price drop badly didnt it...? One angle, same result anyway.

3) Not every capital raising amounts to an immediate dilution. Some of our recent financiers has options which can be excercised when it is profitable for everyone as opposed to diluting everyone. This is not relevant yet IMO, but as i mentioned a month or so ago, Peter said getting finance was already being discussed should it be necessary and at that time it wasnt. This is a new advent.

4) And for now, i will leave you with this 4th food for thought:

"The Reserve Report detailed in this announcement together with the November 2008 announcement detailing the Recoverable Resource, demonstrate that the Company has been successful in achieving a major part of its initial strategy, namely the proving up of a significant reserve/resource." here this evenging. Much of the dicussion about our "sale" value, is being removed from the debate strangely - the things a company will look at when buying us. Emery Coal Bed Methane and Mancos Shale at Cleer Creek and Helper.

We have more reserves than everyone is talking about. Some of those reserves have not been put throught the Cobb and Associates ringer and have not been broken down beyond an "in ground reserve". There is approximately 30odd TRILLION feet of it and of that, over 1 Trillion cubic feet is supposed (according to an independant expert) to be recoverable 2P and 1P Gas.
Now that is a wost case scenario of a 90% discount of reserves in Mancos Shale and Emery Coal Bed Methane regions - AND IT WASNT EVEN REPORTED ON. This is the stuff a company will make us an offer for. It is absolutely enourmous and we only want to get credit/value for 3% of it.

5) Not all the figures have been quoted absolutely correctly here.
We actually have:

• Total Proven reserves are 139.28 Bcfe
• Total Probable reserves are 85.51 Bcfe
• Total Possible reserves are 18.24 Bcf
• Total 3P reserves are 243.03 Bcfe

= 485 Billion Cubic Feet.
The discrepancy has come from us now having 4 categories (as noted just above) instead of just 3.
AND - That is the total accountable IRR result of the reserves for selected (not all) of MAE gas areas.
If they spent another 8 million, we would have more gas in those categories and that is in addition to our calculated resource value to anyone in the know from the industry.

6) How can anyone say we are or are not going to fetch a certain price when they dont know what we are selling?
I wish people would show some foprethought and honestly detailed research by showing us their calculations when they say "its worth 70
or "its worth 20" etc...what is? The whole acreage? Only unproven resource ie mancos and coal bed methane (a popular resource nowadays)? Or are you talking about just Clear Creek? Or Utah as uneconomical? Or a farm-in? What exactly are you ideas based on?
That will help a lot please.
I have stated my thoughts and if anyone has reasonable question i will answer it. I would like until tomorrow morning to become more knowledgeable, after speaking with Jeff in the US tomorrow morning.

I'm happy to help the helpers/givers - very dissuaded by the takers. Diligence is a must.

Join in!

Cheers and good luck to all the respectful posters out there ;-)

Lautrec.