Opportunities

Deep Bossier Joint Venture Gas Opportunity

Opportunity to participate in the development of the prolific Deep Bossier and with additional upside in Glen Rose, Pettet, Knowles Lime and Cotton Valley Group Formations
Large, contiguous acreage position covering approximately 38,000 gross acres (26,091 net acres) in Leon, Madison, Brazos and Robertson Counties of East Texas with a delivered 75% NRI
Deep Bossier estimated gross recoverable resources of 3.7 TCFE
Executive Summary

Acreage Position

ETxOG has accumulated approximately 26,091 net acres in the Deep Bossier trend of Brazos, Madison and Leon counties. The area is also prospective for the Knowles Reef play with additional shallower potential in the Cotton Valley, Travis Peak, Pettit, James Lime, Rodessa, Glen Rose, Buda/Georgetown, Woodbine/Eagleford and Austin Chalk formations.

Opportunity

Multi TCF Potential with Excellent Economic Returns

Encana has estimated that the Deep Bossier contains 50-250 bcf of gas-in-place per square mile.

Morgan Stanley Research recently released a presentation stating the Deep Bossier play is one of the lowest cost natural gas plays in North America. Their research estimated that a Nymex price of $3.50/mmbtu yielded a 10% IRR on a Deep Bossier well.

ETxOG’s single well economics also show a 10% IRR can be achieved with a wellhead price of $2.50/mcf. (ETxOG estimates a $3.50/mmbtu Nymex price is equivalent to a $2.50/mcf wellhead price after deducting for gathering, processing, transportation, fuel and basis differential).

At a $6.00/mcf wellhead price, ETxOG’s single well economics indicate a successful Deep Bossier well yields a 3.9x ROI and a115% IRR.