something in the wind?, page-8

I believe EKA's current share price reflects our current production levels and doesn't factor in the 9 additional wells (on top of our current 9 wells) we'll have producing in 3 months time. According to value anyway imo.

We'll have double our current wells by the end of march, which should make for a pretty action packed next quarter. The possible new reserves report in the June quarter should be interesting, it'll give us an indication of how good Magueyitos will be for us.

I'm hoping that the SP will be around 55-60 cents by march (80-90 cents by the end of 2011), which could possibly enable Eureka to hold a SPP plan to raise $10-15 million at 50c to shareholders, and acquire more acreage, possibly even a portion of Longhorn/Ipenema.

AUT spent 120 million on acquiring a net of 5100 acres from Hilcorp's farm-in program in the Eagleford region. This included an increase of 1850 net acres in Longhorn.

1850/5100 = 0.363 ----> i.e. 36.3% of AUT's acquisition was the increase in their net Longhorn holdings.

0.363 * 120 million = $43.5 million (rough estimation of how much AUT's recent increase of Longhorn acreage cost them)

If we could get $25 million worth of Hilcorp's Longhorn farm-in, or roughly 1060 net acres, that'd provide us with roughly a 3.95% working interest in the Longhorn region. Such an acquisition could be very beneficial in helping EKA expand as a company. Acquiring a smaller working interest in Longhorn/Ipenema would still be beneficial in expanding the company.

Thus if we could acquire $25 million worth of Longhorn/Ipenema ($7.5 million from current cash and the rest funded through a potential SPP in March or there-abouts & cashflow from our producing wells), then I'd be a very happy investor. I'm looking forward to the next quarterly to see whether we've reached our status as being cashflow positive (likely).