The Appalachian area includes portions of the states of Kentucky, New York, Ohio, Pennsylvania, Virginia, West Virginia and Tennessee and covers an area of over 185,000 square miles. It is the most mature oil and natural gas producing region in the United States, first establishing oil production in 1859.

The Appalachian area is strategically located near high energy demand areas with limited supply. As a result, the natural gas from this area typically commands a higher well head price relative to other North American areas.

Although the Appalachian area has sedimentary formations indicating the potential for deposits of oil and natural gas reserves up to depths of 30,000 feet or more, most production in this area has been derived from relatively shallow, low porosity and permeability sand and shale formations at depths of 1,000 feet to 6,000 feet.

Operations in the area are generally characterized by long reserve lives, high drilling success rates and a large number of low productivity wells in these shallow formations. In the Appalachian area, there are more than 200,000 producing wells and 3,100 operators, with most being relatively small, private enterprises.

At June 30, 2007, the Company had proved reserves of 80.1 Bcfe and 1,339 gross producing wells in the Northern West Virginia area. The net daily production from these wells for the month of June 2007 averaged 9.9 Mmcfe/d. At June 30, 2007, the Company had proved reserves of 50.9 Bcfe and 822 gross producing wells in The Southern West Virginia area. The net daily production from these wells for the month of June 2007 averaged 6.0 Mmcfe/d.

The Holly/Caspiana area is located in De Soto Parish, Louisiana. Production is from the Cotton Valley and Hosston formations found at depths of 9,000 feet to 11,000 feet. At June 30, 2007, the Company had proved reserves of 38.7 Bcfe and 138 gross producing wells. The net daily production from these wells for the month of June 2007 averaged 15.1 Mmcfe/d.

The Longwood/Waskom area is located in Caddo Parish, Louisiana and Harrison and Panola Counties, Texas. Production is from the Cotton Valley and Hosston/Travis Peak formations found at depths of 6,200 feet to 10,200 feet. At June 30, 2007, the Company had proved reserves of 49.3 Bcfe and 218 gross producing wells. The net daily production from these wells for the month of June 2007 averaged 18.4 Mmcfe/d.

The Gladewater area is located in Gregg and Upshur Counties, Texas. Production is from the Pettet, Travis Peak and Cotton Valley formations found at depths of 7,100 feet to 11,500 feet. At June 30, 2007, the Company had proved reserves of 55.6 Bcfe and 359 gross producing wells. The net daily production from these wells for the month of June 2007 averaged 13.8 Mmcfe/d.

The Mid-Continent area contains a number of fields with long production histories. At June 30, 2007, the Company had proved reserves in the Mocane-Laverne area area of 85.9 Bcfe and 692 gross producing wells. At June 30, 2007, the Company had proved reserves in the Golden Trend area of 121.1 Bcfe and 571 gross producing wells. At June 30, 2007, the Company had proved reserves in the Watonga Chickasha area of 38.0 Bcfe and 127 gross producing wells.

The Company’s Permian area properties are located primarily in Dawson and Val Verde Counties, Texas and Chaves County, New Mexico. At June 30, 2007, the Company had proved reserves of 34.1 Bcfe and 113 gross producing wells in the Permian area.

Net income and total oil and natural gas revenues for the six month period ended June 30, 2007 were $79.5 million and $219.3 million, respectively, compared with pro forma net income of $118.1 million and total oil and natural gas revenues of $259.4 million for the six month period ended June 30, 2006.

Pro forma oil and natural gas revenues, before the impact of derivative financial instruments were $219.3 million and $259.4 million for the six month periods ended June 30, 2007 and 2006, respectively.

Pro forma oil and natural gas operating costs were $40.1 million and $35.2 million for the six-month periods ended June 30, 2007 and 2006, respectively.

For the six month periods ended June 30, 2007 and 2006, total depreciation, depletion and amortization expense was $73.7 million and $81.0 million, respectively.