Current News Period of November 4 2007 to September 14 2008

The heat was on even though the weather was cold.  Last winter was day after day of working 7 days a week, turning on the lights and working into the night.  As the days went on the work was good and I saw the new Sanders tank battery taking shape.  Finally the gas was flowing and the expiring lease was preserved two weeks ahead of the deadline in January.  From there we turned our attention to the Khan lease where we had to build a flow line and electrical system to accommodate the six new wells drilled from 2005-2007.  The work continued non stop February and March and the weather co-operated nicely. 

However there were no end of distractions as most of our injection wells had to be tested, and we had some that also required to cleaned and fished out.  Victory came as we finally fished the packer on Anderson B-18, a well that had eluded me 4 years before as I had to walk away from the well in discouraged failure.  Getting the B-18 well equipped and functioning was paramount to being able to establish production on our Anderson B and Drummer leases.

April  2008 brought a huge setback as we were working on replacing a failing gun barrel on the Scovel lease when a fire got out of hand and everything worked against us, as the fire erupted and spread from tank to tank, ultimately consuming 5 of 6 tanks and one shed on the tank battery.  May was spent putting things back together and rearranging things.  The rebuilt tank battery is better and more capable of handling more fluids from the whole Scovel lease.

As things would have it the surface land owner on Anderson A, B and Drummer started exerting huge pressure, with his lawyer forcing me accelerate clean up activities on those lease, which has turned out to be a huge project, as 100 years of predecessors had left their mark on the land.  This project is still under way, but great progress has been made through out this summer.

We finally placed two new wells on production on Khan and sadly Khan #3 in our oil filled coal zone has proven to be marginal at best.  However there are other more attractive zones in that well that should perform better, if I can find the funds to re-complete the well.  The other well Khan F-6 for what it is has been doing well as it came in at 20 MCF and has settled down to 5 MCF from 190 ft.

With all the aging stock tanks we own, and a replacement cost of over $5,000 each, I knew we are facing a huge problem of repair or replacement.  We have been developing the ability to lift a tank and replace the bottom and put it back together again.  This technology was put to the test on the Akin lease as both tanks failed within 3 months of each other.  While it proved to be quite a job, we succeed in repair of these two tanks and placed them back into service.

So that's about it.  Provided I can finance the projects we will just keep on working and trying to increase our production and further our opportunities for more projects in the future.