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<SEC-DOCUMENT>0000788965-06-000014.txt : 20060414
<SEC-HEADER>0000788965-06-000014.hdr.sgml : 20060414
<ACCEPTANCE-DATETIME>20060414164621
ACCESSION NUMBER:		0000788965-06-000014
CONFORMED SUBMISSION TYPE:	10KSB
PUBLIC DOCUMENT COUNT:		8
CONFORMED PERIOD OF REPORT:	20051231
FILED AS OF DATE:		20060414
DATE AS OF CHANGE:		20060414

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			HALLADOR PETROLEUM CO
		CENTRAL INDEX KEY:			0000788965
		STANDARD INDUSTRIAL CLASSIFICATION:	CRUDE PETROLEUM & NATURAL GAS [1311]
		IRS NUMBER:				841014610
		STATE OF INCORPORATION:			CO
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10KSB
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-14731
		FILM NUMBER:		06760883

	BUSINESS ADDRESS:	
		STREET 1:		1660 LINCOLN ST STE 2700
		CITY:			DENVER
		STATE:			CO
		ZIP:			80264
		BUSINESS PHONE:		3038395505

	MAIL ADDRESS:	
		STREET 1:		1660 LINCOLN STREET
		STREET 2:		SUITE 2700
		CITY:			DENVER
		STATE:			CO
		ZIP:			80264

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	KIMBARK OIL & GAS CO /CO/
		DATE OF NAME CHANGE:	19900102

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	KIMBARK INC
		DATE OF NAME CHANGE:	19860624
</SEC-HEADER>
<DOCUMENT>
<TYPE>10KSB
<SEQUENCE>1
<FILENAME>hpc200510ksb.htm
<DESCRIPTION>DECEMBER 31, 2005 FORM 10-KSB FOR HALLADOR PETROLEUM COMPANY
<TEXT>
<html>
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    <title>
      December 31, 2005 Form 10-KSB for Hallador Petroleum Company
</title>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>UNITED
        STATES</strong></font></div>
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        AND EXCHANGE COMMISSION</strong></font></div>
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        D. C. 20549</strong></font></div>
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        10-KSB</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">ANNUAL
                  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
                  OF 1934
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              </td>
            </tr>
            <tr>
              <td valign="top" width="6%">&#160;</td>
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                  the fiscal year ended: </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>December
                  31, 2005</strong></font></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">[&#160;
                  ]</font></div>
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              <td align="justify" valign="top" width="85%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">TRANSITION
                  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
                  OF
                  1934</font></div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="6%">&#160;</td>
              <td align="justify" valign="top" width="85%">&#160;</td>
            </tr>
            <tr>
              <td valign="top" width="6%">&#160;</td>
              <td valign="top" width="85%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Commission
                  file number: 0-14731</font></div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="6%">&#160;</td>
              <td valign="top" width="85%">&#160;</td>
            </tr>
            <tr>
              <td valign="top" width="6%">&#160;</td>
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                  PETROLEUM COMPANY</strong></font></div>
              </td>
            </tr>

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                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(State
                    of incorporation)</font></div>
                </td>
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                <td valign="top" width="35%" style="border-bottom: thin solid;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>84-1014610</u></font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(IRS
                    Employer Identification No.)</font></div>
                </td>
              </tr>
              <tr>
                <td valign="top" width="51%">&#160;</td>
                <td valign="top" width="6%">&#160;</td>
                <td valign="top" width="35%">&#160;</td>
              </tr>

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          <table cellpadding="0" cellspacing="0" width="100%">

              <tr>
                <td valign="top" width="51%" style="border-bottom: thin solid;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>1660
                    Lincoln Street, Suite 2700, Denver, Colorado</u></font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Address
                    of principal executive offices)</font></div>
                </td>
                <td valign="top" width="6%">&#160;</td>
                <td valign="top" width="34%" style="border-bottom: thin solid;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>80264-2701</u></font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Zip
                    Code)</font></div>
                </td>
              </tr>
              <tr>
                <td align="left" valign="top" width="51%">&#160;</td>
                <td align="left" valign="top" width="6%">&#160;</td>
                <td align="left" valign="top" width="34%">&#160;</td>
              </tr>
              <tr>
                <td valign="top" width="51%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Issuer's
                    telephone number<u>: 303.839.5504</u></font></div>
                </td>
                <td align="left" valign="top" width="6%">&#160;</td>
                <td valign="top" width="34%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Fax:
                    <u>303.832.3013</u></font></div>
                </td>
              </tr>

          </table>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br>Securities
          registered under Section 12(b) of the Exchange Act:
&#160;NONE</div>
      </div>
      <div style="MARGIN: 0in 0in 0pt">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt">Securities registered under Section 12(g)
        of
        the Exchange Act: &#160;Common Stock, $.01 par value</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">Check
        whether the issuer is not required to file reports pursuant to Section 13
        or
        15(d) of the Exchange Act.&#160; [&#160; ] </div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">Check
        whether the issuer (1) filed all reports required to be filed by Section
        13 or
        15(d) of the Exchange Act during the past 12 months (or for such shorter
        period
        that the registrant was required to file such reports), and (2) has been
        subject
        to such filing requirements for the past 90 days. Yes [x] &#160;&#160;No [
        ]</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">Check
        if there is no disclosure of delinquent filers in response to Item 405 of
        Regulation S-B contained in this form, and no disclosure will be contained,
        to
        the best of registrant's knowledge, in definitive proxy or information
        statements incorporated by reference in Part III of this Form 10-KSB or any
        amendment to this Form 10-KSB. [&#160; ]</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">Indicate
        by check mark whether the registrant is a shell company (as defined in Rule
        12b-2 of the Exchange Act).&#160; Yes [ ]&#160;&#160; No [x]</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">Our
        revenue from continuing operations for the year ended December 31, 2005 was
        about $1.1 million.</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-hyphenate: none; tab-stops: -.5in">At
        April 4, 2006, we had 12,168,135 shares outstanding and the aggregate market
        value of such shares held by non-affiliates was about $4 million based on
        a
        closing price of $4.10.</div>
      <div style="MARGIN: 0in 0in 0pt; tab-stops: -.5in">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; tab-stops: -.5in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">DOCUMENTS
        INCORPORATED BY REFERENCE: NONE</font></div>
    </div>
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    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: .75in center 3.45in"><strong>ITEM
      1.&#160;&#160;&#160; DESCRIPTION OF BUSINESS</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in"><u><strong>General
      Development of Business</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Hallador
      Petroleum Company (Hallador), a Colorado corporation, was organized by our
      predecessor in 1949.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">About
      nine years ago, Yorktown Energy Partners II and affiliates (Yorktown) invested
      $5,025,000 in Hallador Petroleum, LLP, a newly formed limited liability limited
      partnership, (the "Partnership").&#160; We are the general partner and received
      a 70% interest in the partnership in return for contributing our net assets
      and
      Yorktown representing the limited partners, received a 30% interest for its
      $5,025,000 cash contribution. &#160;During the third quarter of 2005, we
      purchased the limited partners interest in the Partnership, and for accounting
      purposes the Partnership no longer exists and, as a result, there is no longer
      a
      minority interest caption on our balance sheet.&#160; Prior to this transaction
      we, as general partner, consolidated the activity of the Partnership and
      presented the 30% limited partners&#8217; interest as a minority interest.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">On August 10, 2004, we entered into an
      agreement with E&amp;B Natural Resources Management Corporation (a private
      company) to sell all of our interest in the South Cuyama field and adjacent
      exploration areas, all located in Santa Barbara County, California, for $23
      million; consisting of $19.5 million in cash and an interest bearing (3.5%)
      note
      of $3.5 million due on September 30, 2005, which was paid.&#160; Closing
      occurred on September 30, 2004 and we recorded a pre-tax gain of about $14
      million.&#160; Results from the South Cuyama field have been presented as
      discontinued operations in the accompanying Consolidated Statement of
      Operations. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">Due to the sale, our board of directors and
      the
      Executive Committee of the Partnership, voted to discontinue new partnership
      operations effective October 1, 2004.&#160; At that time, &#160;the
      Partnership's assets consisted of cash, the $3.5 million note receivable, oil
      and gas properties in New Mexico and Texas, and other miscellaneous
      assets.&#160; On October 1, 2004, our &#160;board of directors and the Executive
      Committee of the Partnership, valued the oil and gas properties in New Mexico
      and Texas and the other miscellaneous assets at $4 million. On May 6, 2005
      we
      made a cash distribution of about $5.2 million to the limited partners.&#160;
During the third quarter 2005, we purchased the limited partners' interest
      in
      the Partnership for about $1.2 million and made a final cash distribution to
      the
      limited partners of $1.6 million.&#160; After these transactions, about $1.7
      million remained in the minority interest account and was recorded as a
      reduction in our accumulated deficit account.&#160; </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">In late March 2005, we invested $325,000 for
      a
      29% interest in a newly formed entity called COALition Energy, LLC (CELLC)
      to
      pursue coal opportunities in the United States.&#160; Some of our officers and
      directors also invested in CELLC. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">2</font></div>
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    <div style="MARGIN: 0in 0in 0pt">We have concluded to deemphasize our oil and
      gas operations and concentrate our future efforts in the coal business.&#160;
With that in mind, the following events have occurred:</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In early January 2006, we
      signed a Letter of Intent with Sunrise Coal, LLC (Sunrise) in order to effect
      a
      reorganization/merger between Hallador and Sunrise, a private company not
      affiliated with the Yorktown group of companies.&#160; We are working on a
      formal agreement which we hope to execute sometime in the second quarter 2006.
      Upon closing, it is expected that our existing shareholders will own about
      52%
      and the Sunrise shareholders will own about 48% of the new company.&#160; </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
CELLC brought us the Sunrise deal and, upon
      closing, they will receive a finders
      fee, stock and warrants in the new company.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
During the first quarter of 2006, we loaned
      Sunrise $7 million in order for
      Sunrise to begin development of their second coal mine (the "Carlisle mine").
      &#160;&#160;Their Howesville mine began producing coal in November 2005.&#160;
Both mines are located in Indiana.&#160; &#160;During the second quarter of
      2006, Sunrise expects to enter into a $30 million line-of- credit with two
      Indiana banks, at which time our $7 million will be repaid.&#160; We have agreed
      to guarantee this $30 million line-of-credit.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In late February 2006, we
      sold 3,181,816 shares for $2.20 per share (about $7 million) to our existing
      shareholders.&#160; The proceeds will provide working capital for the Sunrise
      transaction.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">With regards to our oil and gas business, the
      following events have occurred:</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In August 2005, we began
      negotiations to purchase from Yorktown Energy Partners II, LP its 32% interest
      in Savoy Energy LLP, a private company engaged in the oil and gas business
      primarily in the State of Michigan.&#160; A purchase price of $4.1 million was
      agreed upon and closing occurred on December 31, 2005.&#160; On December 20,
      2005 we sold about 1,893,000 shares of our common stock to Yorktown Energy
      Partners VI LP at $2.20 per share (about $4.1 million).&#160; We will account
      for our interest in Savoy using the equity method of accounting.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In December 2005, we sold
      substantially all of our interest in our North Dakota properties for about
      $1.6
      million, which was our original investment; accordingly, no gain or loss was
      recognized.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
3.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In late March 2006, we signed
      a letter-of-intent with Approach Resources Inc., to sell them all our interests
      in our Albany Shale prospect located in Kentucky.&#160; If we close this
      transaction, we expect to recognize a gain of about $600,000 and our cash
      proceeds will be about $3.3 million. Approach Resources Inc., based in Fort
      Worth, Texas, has an affiliation with the Yorktown group of companies.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Our
      office is located at 1660 Lincoln Street, Suite 2700, Denver, Colorado 80264,
      phone 303.839.5504, fax 303.832.3013.&#160; We have no website.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Until
      we close the Sunrise deal, there is no need to discuss the coal business and
      the
      rest of this discussion will be about our oil and gas operations.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
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    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">We
      operate oil and natural gas properties for our own account and for the account
      of others.&#160; We also review and evaluate producing oil and natural gas
      properties, companies, or other entities, which meet certain guidelines for
      acquisition purposes.&#160; Occasionally, we engage in the trading and
      acquisition of non-producing oil and gas mineral leases and fee-simple
      minerals.</div>
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    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in"><u><strong>Markets</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Our
      products are sold to various purchasers in the geographic area of the
      properties.&#160; Natural gas, after processing, is distributed through
      pipelines.&#160; Oil and natural gas liquids (NGLs) are distributed through
      pipelines or hauled by trucks.&#160; The principal uses for oil and natural gas
      are heating, manufacturing, power, and transportation.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in"><u><strong>Competition</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">The
      oil and gas industry is highly competitive.&#160; We encounter competition from
      major and independent oil companies in acquiring economically desirable
      producing properties, drilling prospects, and even the equipment and labor
      needed to drill, operate and maintain our properties.&#160; Competition is
      intense with respect to the acquisition of producing and partially developed
      properties.&#160; We compete with companies having financial resources and
      technical staffs significantly larger than our own. We do not own any refining
      or retail outlets and have minimal control over the prices of our
      products.&#160; Generally, higher costs, fees and taxes assessed at the producer
      level cannot be passed on to our customers. </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">We
      also face competition from imported products as well as alternative sources
      of
      energy such as coal, nuclear, hydro-electric power, and a growing trend toward
      solar. We could incur delays or curtailments of the purchase of our available
      production.&#160; We may also encounter increasing costs of production and
      transportation while sale prices remain stable or decline.&#160; Any of these
      competitive factors could have an adverse effect on our operating results.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in"><u><strong>Environmental
      and Other Regulations</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Our
      operations are affected in varying degrees by federal, state, regional and
      local
      laws and regulations, including, but not limited to, laws governing allowable
      rates of production, well spacing, air emissions, water discharges, endangered
      species, marketing, prices and taxes.&#160; We are further affected by changes
      in such laws and by constantly changing administrative regulations.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Most
      natural gas pricing is presently deregulated and the remaining regulation has
      no
      material impact on our prices.&#160; We cannot predict the long-term impact of
      future natural gas price regulation or deregulation.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">We
      are subject to various federal, state, regional and local laws and regulations
      relating to discharge of materials into, and protection of, the
      environment.&#160; These laws and regulations may, among other things, impose
      liability on the owner or the lessee for the cost of pollution clean-up
      resulting from operations, subject the owner or lessee to liability for
      pollution damages, require suspension or cessation of operations in affected
      areas or impose restrictions on injection into subsurface aquifers that may
      contaminate groundwater.&#160; Such regulation has increased the resources
      required in, and costs associated with, planning, designing, drilling,
      installing, operating and abandoning our oil and natural gas wells and other
      facilities.</div>
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    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">We
      have and will continue to make expenditures to comply with these requirements,
      which we believe are necessary business costs.&#160; Although environmental
      requirements do have a substantial impact upon the energy industry, generally
      these requirements do not appear to affect us any differently or to any greater
      or lesser extent than other companies.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Although
      we are not fully insured against all environmental and other risks, we maintain
      insurance coverage, which we believe, is customary in the industry.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">During
      2005, the cost to comply with these recurring environmental regulations were
      not
      significant to our continuing operations and are not expected to be in the
      foreseeable future.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">To
      the extent these environmental expenditures reduce funds available for
      increasing our reserves of oil and natural gas, future operations could be
      adversely impacted.&#160; Despite the fact that all of our competitors have to
      comply with similar regulations, many are much larger and have greater resources
      with which to deal with these regulations.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in"><u><strong>Other</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">We
      have
      no significant patents, trademarks, licenses, franchises or
      concessions.</font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">The
      oil business is not generally seasonal in nature; although unusual weather
      extremes for extended periods may increase or decrease demand.&#160; Natural gas
      prices tend to increase in the fall and winter months and to decrease in the
      spring and summer.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">We
      have four full-time employees and two part-time employees.&#160; When needed we
      also engage consulting petroleum engineers, environmental professionals,
      geologists, geophysicists, landmen, accountants and attorneys on a fee
      basis.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 54.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in .75in"><strong>ITEM
      2.&#160;&#160;&#160; DESCRIPTION OF PROPERTY</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in"><u><strong>Location
      and General Character</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Our
      primary operating property is in the San Juan Basin, located in the northwest
      corner of New Mexico.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">We
      hold
      our working interests in oil and natural gas properties either through
      recordable assignments, leases, or contractual arrangements such as operating
      agreements.&#160; Consistent with industry practices, we do not make a detailed
      examination of title when we acquire undeveloped acreage.&#160; Title to such
      properties is examined by legal counsel prior to commencement of drilling
      operations.&#160; This method of title examination is consistent with industry
      practices. </font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">In
      the acquisition and operation of oil and natural gas properties, burdens such
      as
      royalty, overriding royalty, liens incident to operating agreements, liens
      by
      taxing authorities, as well as other burdens and minor encumbrances are
      customarily created. We believe that no such burdens materially affect the
      value
      or use of our properties.</div>
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    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Savoy's
      oil and gas properties are located primarily in the State of Michigan.&#160;
Savoy's condensed financial statements are presented in Note 5 to our financial
      statements and Savoy's condensed oil and gas reserve information is presented
      in
      Note 6 to our financial statements.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in"><u><strong>Proved
      Oil and Gas Reserves</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">Information
      concerning our reserve estimates is set forth in Note 6 to the consolidated
      financial statements.&#160; Our reserve estimates were prepared by a
      sole-proprietor consulting petroleum engineer and Savoy's reserve estimates
      were
      prepared by Netherland, Sewell &amp; Associates.&#160; All of our and Savoy's
      reserves are located onshore.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: -1.0in -.5in 0in .5in .8in 1.0in 1.5in 2.0in right 373.5pt 441.0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u><strong>Sales
      and Price Data</strong></u></font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in .5in .8in 1.0in 1.5in 2.0in right 373.5pt 441.0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in .5in .8in 1.0in 1.5in 2.0in right 373.5pt 441.0pt">See
      Item 6 &#8211; MD&amp;A</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in .4in .7in .9in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in .4in .7in .9in"><u><strong>Producing
      Wells</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in .4in .7in .9in"><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">As
        of
        April 4, 2006, we had a working interest in 32 gross (3 net) gas
        wells.</font></div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in .4in .7in .9in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in .4in .7in .9in"><u><strong>Leasehold
      Interests</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt"><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
        following table sets forth our gross and net acres of undeveloped oil and
        gas
        leases as of April 4, 2006:</font></div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt" align="left">&#160;</div>
    <div>
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            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="center">&#160;</div>
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            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="center">Net
</div>
            </td>
            <td valign="top" width="252" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 189pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="center">&#160;</div>
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          </tr>
          <tr style="mso-yfti-irow: 1;">
            <td valign="top" width="60" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: -1.0in -.5in -18.3pt 0in 18.3pt; mso-pagination: none">&#160;</div>
            </td>
            <td valign="top" width="192" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 2in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: -1.0in -.5in -18.3pt 0in 18.3pt; mso-pagination: none">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
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            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="252" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 189pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2;">
            <td valign="top" width="60" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: -1.0in -.5in -18.3pt 0in 18.3pt; mso-pagination: none">&#160;</div>
            </td>
            <td valign="top" width="192" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 2in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: -1.0in -.5in -18.3pt 0in 18.3pt; mso-pagination: none">Kentucky</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">66,279</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">65,903</div>
            </td>
            <td valign="top" width="252" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 189pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 3;">
            <td valign="top" width="60" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: -1.0in -.5in -18.3pt 0in 18.3pt; mso-pagination: none">&#160;</div>
            </td>
            <td valign="top" width="192" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 2in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: -1.0in -.5in -18.3pt 0in 18.3pt; mso-pagination: none">Montana</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">34,474</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">28,854</div>
            </td>
            <td valign="top" width="252" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 189pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4;">
            <td valign="top" width="60" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt">&#160;</div>
            </td>
            <td valign="top" width="192" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 2in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt">North
                Dakota</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">812</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">121</div>
            </td>
            <td valign="top" width="252" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 189pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 5;">
            <td valign="top" width="60" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt">&#160;</div>
            </td>
            <td valign="top" width="192" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 2in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt">Wyoming</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">44,324</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">36,784</div>
            </td>
            <td valign="top" width="252" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 189pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 6;">
            <td valign="top" width="60" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt">&#160;</div>
            </td>
            <td valign="top" width="192" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 2in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt">Other
                </div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">238</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">25</div>
            </td>
            <td valign="top" width="252" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 189pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 7; mso-yfti-lastrow: yes;">
            <td valign="top" width="60" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 17.1pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">&#160;</div>
            </td>
            <td valign="top" width="192" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 2in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 17.1pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">Total</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">146,127</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">131,687</div>
            </td>
            <td valign="top" width="252" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 189pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt" align="right">&#160;</div>
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">&#160;</div>
    <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u><strong>Drilling
      Activity - Continuing Operations</strong></u></font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">During
      2005, we drilled two development gas wells, the Horton 1C and the Horton 1D,
      located in the San Juan Basin.&#160; We have about a 6% WI in each well. </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">Nothing
      has been drilled so far in 2006.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">During
      2004, there was no drilling activity. </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; tab-stops: .75in"><strong>ITEM
      3.&#160;&#160;&#160; LEGAL PROCEEDINGS</strong>: &#160;None</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: .75in"><strong>ITEM
      4.&#160;&#160;&#160; SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
</strong>None</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">6</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div><br clear="all">
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: center 3.25in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center"><strong>PART
      II</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt 128.1pt 146.4pt 164.7pt 183.0pt 215.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt 0.75in; TEXT-INDENT: -0.75in; mso-hyphenate: none; tab-stops: 54.9pt"><strong>ITEM
      5.&#160;&#160;&#160; MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
      SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">Our
      common stock is traded on the OTC Bulletin Board under the symbol &#8220;HPCO&#8221;.&#160;
The following table sets forth the high and low sales price for the periods
      indicated:</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="MARGIN: auto auto auto 23.4pt; BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-yfti-tbllook: 480">

          <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">High</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">Low</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 1;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">2006</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; mso-hyphenate: none">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">(January
                1 through April 4, 2006)</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">$</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">4.10</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">$</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">3.10</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 3;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">2005</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 5;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">First
                quarter</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">2.15</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">2.10</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 6;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">Second
                quarter</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">3.40</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">1.75</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 7;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">Third
                quarter</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">8.00</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">2.06</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 8;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">Fourth
                quarter</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">3.99</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">2.00</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 9;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 10;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">2004</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">&#160;</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 11;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">First
                quarter</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">1.55</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">1.15</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 12;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">Second
                quarter</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">5.15</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">1.35</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 13;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">Third
                quarter</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">3.00</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">2.10</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 14;">
            <td valign="top" width="288" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 3in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">Fourth
                quarter</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">3.05</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">2.10</div>
            </td>
            <td valign="top" width="120" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 15; mso-yfti-lastrow: yes;">
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            </td>
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      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt right 4.5in 5.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">During
      the last two years no dividends were paid.&#160; We have no present intention to
      pay any dividends in the foreseeable future.</font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">At
      April 4, 2006 there were 393 holders of record of our common stock and the
      last
      recorded sales price was $4.10.&#160; </div>
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      </div>
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    </div><br clear="all">
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: .75in"><strong>ITEM
      6.&#160;&#160;&#160; MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
      OPERATION</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt"><u><strong>Overview</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">Our
      consolidated financial statements should be read in conjunction with this
      discussion.&#160; Our primary operating property is in the San Juan Basin,
      located in the northwest corner of New Mexico.&#160; Due to the sale of the
      South Cuyama field in 2004, as discussed below, we are engaged in the
      exploration, development and production of oil and natural gas in the Rocky
      Mountain region.&#160; We also have a 32% equity interest in an oil and gas
      company which has operations in Michigan.&#160; We have concluded to deemphasize
      our oil and gas operations and concentrate our future efforts in the coal
      business.&#160; </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">What
      follows is a timeline that tells where we have been and where we plan to
      go.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">About
      nine years ago, Yorktown Energy Partners II and affiliates (Yorktown) invested
      $5,025,000 in Hallador Petroleum, LLP, a newly formed limited liability limited
      partnership, (the "Partnership").&#160; We are the general partner and received
      a 70% interest in the partnership in return for contributing our net assets
      and
      Yorktown representing the limited partners, received a 30% interest for its
      $5,025,000 cash contribution.&#160; During the third quarter of 2005, we
      purchased the limited partners interest in the Partnership, and for accounting
      purposes the Partnership no longer exists and, as a result, there is no longer
      a
      minority interest caption on our balance sheet.&#160; Prior to this transaction
      we, as general partner, consolidated the activity of the Partnership and
      presented the 30% limited partners&#8217; interest as a minority interest.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">On August 10, 2004, we entered into an
      agreement with E&amp;B Natural Resources Management Corporation (a private
      company) to sell all of our interest in the South Cuyama field and adjacent
      exploration areas, all located in Santa Barbara County, California, for $23
      million; consisting of $19.5 million in cash and an interest bearing (3.5%)
      note
      of $3.5 million due on September 30, 2005, which was paid.&#160; Closing
      occurred on September 30, 2004 and we recorded a pre-tax gain of about $14
      million.&#160; Results from the South Cuyama field have been presented as
      discontinued operations in the accompanying Consolidated Statement of
      Operations; revenue and expenses before the minority interest were about $7
      million and $5 million, respectively for 2004.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">Due to the sale, our board of directors and
      the
      Executive Committee of the Partnership, voted to discontinue new partnership
      operations effective October 1, 2004.&#160; At that time,&#160; the
      Partnership's assets consisted of cash, the $3.5 million note receivable, oil
      and gas properties in New Mexico and Texas, and other miscellaneous
      assets.&#160; On October 1, 2004, our&#160; board of directors and the Executive
      Committee of the Partnership, valued the oil and gas properties in New Mexico
      and Texas and the other miscellaneous assets at $4 million. On May 6, 2005
      we
      made a cash distribution of about $5.2 million to the limited partners.&#160;
During the third quarter 2005, we purchased the limited partners' interest
      in
      the Partnership for about $1.2 million and made a final cash distribution to
      the
      limited partners of $1.6 million.&#160; After these transactions, about $1.7
      million remained in the minority interest account and was recorded as a
      reduction in our accumulated deficit account. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">In late March 2005, we invested $325,000 for
      a
      29% interest in a newly formed entity called COALition Energy, LLC (CELLC)
      to
      pursue coal opportunities in the United States.&#160; Some of our officers and
      directors also invested in CELLC. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
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      </div>
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    </div>
    <div style="MARGIN: 0in 0in 0pt"><u><strong>Significant
      Transactions</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In early January 2006, we
      signed a Letter of Intent with Sunrise Coal, LLC (Sunrise) with the intent
      to
      effect a reorganization/merger between Hallador and Sunrise a private company
      not affiliated with the Yorktown group of companies. &#160;We are working on a
      formal agreement which we hope to execute sometime in the second quarter 2006.
      Upon closing, it is expected that our existing shareholders will own about
      52%
      and the Sunrise shareholders will own about 48% of the new company.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
CELLC brought us the Sunrise deal and, upon
      closing, they will receive a finders
      fee, stock and warrants in the new company.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
During the first quarter of 2006, we loaned
      Sunrise $7 million in order for
      Sunrise to begin development of their second coal mine (the "Carlisle
      mine").&#160; Their Howesville mine began producing coal in November 2005.&#160;
Both mines are located in Indiana.&#160; During the second quarter of 2006,
      Sunrise expects to enter into a $30 million line-of- credit with two Indiana
      banks, at which time our $7 million will be repaid.&#160; We have agreed to
      guarantee this $30 million line-of-credit.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In late February 2006, we
      sold&#160;3,181,816 shares for $2.20 per share (about $7 million) to our
      existing shareholders.&#160; The proceeds were used to make the bridge loan
      discussed above.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">With regards to our oil and gas business, the
      following events have occurred:</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In August 2005, we began
      negotiations to purchase from Yorktown Energy Partners II, LP its 32% interest
      in Savoy Energy LLP, a private company engaged in the oil and gas business
      primarily in the State of Michigan.&#160; A purchase price of $4.1 million was
      agreed upon and closing occurred on December 31, 2005.&#160; On December 20,
      2005 we sold about 1,893,000 shares of our common stock to Yorktown Energy
      Partners VI, &#160;L.P. at $2.20 per share (about $4.1 million).&#160; We will
      account for our interest in Savoy using the equity method of accounting.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In December 2005, we sold
      substantially all of our interest in our North Dakota properties for about
      $1.6
      million, which was our original investment; accordingly, no gain or loss was
      recognized.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
3.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In late March 2006, we signed
      a letter-of-intent with Approach Resources Inc.,&#160;to sell them all our
      interests in our Albany Shale prospect located in Kentucky.&#160; If we close
      this transaction, we expect to recognize a gain of about $600,000 and our cash
      proceeds will be about $3.3 million. &#160;Approach Resources Inc., based in
      Fort Worth, Texas, has an affiliation with the Yorktown group of
      companies.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">Our
      profitability in any particular accounting period will be directly related
      to:&#160; (i) prices, (ii) production, (iii) lifting costs, and (iv) exploration
      activities.&#160; Accordingly, operating results will fluctuate from period to
      period based on these factors, among others.&#160; </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
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        </div>
      </div>
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        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">
      <div id="HDR">What follows is a discussion of our primary operating
        area.</div>
    </div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong><u>San
      Juan </u><u>Basin</u></strong></font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">This
      gas
      field is located in the northwest corner of New Mexico in San Juan County.&#160;
We have an interest in 28 wells and are the operator. These wells have
      long-lived reserves. Our WI in this field ranges from 5%-15% with NRIs between
      5%-13%.&#160; At December 31, 2005, our net book value in this prospect was
      about $600,000.&#160; We assigned proved developed gas reserves to this field of
      about 1.3 BCF to our interest.</font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u><strong>Investments
      Made In 2005</strong></u></font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">In
      December 2005, we sold substantially all of our interest in North Dakota for
      $1.6 million which was our original cost, and accordingly, no gain or loss
      was
      recognized.</font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<strong><u>Coal
      </u></strong></font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">In
      late
      March 2005, we invested $325,000 for a 29% interest in a newly formed entity
      called COALition Energy, LLC (CELLC).&#160; CELLC was formed to pursue coal
      investments.&#160; Mr. Stabio, Mr. Dietler, Mr. David Hardie and Mr. Steven
      Hardie, of our board of directors, also invested in CELLC on the same terms
      as
      we did, and collectively they own about 14%.&#160;&#160; Kestrel Energy
      Partners, which Yorktown Energy Partners, LLC, has invested in, has a 20%
      interest in CELLC.&#160; We provide offices and administrative services for
      CELLC.&#160; Gerald Schissler, CEO, age 61 and Jerry Vaninetti, COO, age 56,
      both of which have extensive experience in the coal industry are contract
      employees of CELLC.&#160; At payout, these two individuals, will each earn a 10%
      interest in CELLC. </font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">As
      discussed above, CELLC will receive a finders fee upon the closing of the
      Sunrise deal.</font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 27.0pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 27.0pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
      <strong><u>Albany</u><u> Shale Gas Lease Play</u></strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 27.0pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">During
      2005, we have invested about $2.8 million in this wildcat gas lease play located
      in Western Kentucky.&#160; To date we have leased about 65,000 acres.&#160; Over
      80% of the acreage is held under five-year leases with the right to extend
      for
      another five years by paying $2 per acre per year.&#160; As discussed above, we
      hope to sell this prospect to Approach Resources, Inc. sometime in April
      2006.&#160; Under the letter of intent, Approach is to drill and complete three
      exploratory gas wells at no cost to us, other than minimal acreage
      costs.&#160;&#160; Upon completion we will have a one third (1/3) interest in
      each well and have the right to repurchase a one third (1/3) interest in future
      drilling prospects at the ground floor cost.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: 27.0pt" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u><strong>Liquidity
      and Capital Resources</strong></u></font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">To
      date, we have incurred significant accounting and legal fees ($150,000) in
      connection with the Sunrise deal and such fees will continue until closing
      occurs.&#160; At December 31, 2005, we capitalized $21,000 in such costs, and if
      closing does not occur, such costs will be expensed.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">10</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
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      <div id="HDR">
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    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt decimal 272.55pt 346.9pt">Cash
      and cash to be provided from operations are expected to enable us to meet our
      obligations as they become due during the next several years. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">We have no bank debt, no special purpose
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    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">As discussed above, we have entered into
      significant related party transactions with the Yorktown group of
      companies.&#160; Yorktown and its affiliates currently own about 54% of our
      common stock and represents one of the five seats on our board.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -1.0in -36.6pt -18.3pt 0in 18.3pt 36.6pt 47.55pt 73.2pt right 229.5pt 261.0pt decimal 272.55pt 346.9pt" align="left">&#160;</div>
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    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">The table below provides sales data and average
      prices for the period.</div>
    <div style="MARGIN: 0in 0in 0pt"><br>&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td align="justify" valign="bottom" width="14%">&#160;</td>
              <td colspan="5" valign="bottom" width="35%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">2005</div>
              </td>
              <td valign="bottom" width="4%">&#160;</td>
              <td colspan="5" valign="bottom" width="32%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">2004</div>
              </td>
            </tr>
            <tr>
              <td align="justify" valign="bottom" width="14%">&#160;</td>
              <td valign="bottom" width="9%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">Sales
                  Volume</div>
              </td>
              <td valign="bottom" width="4%">&#160;</td>
              <td valign="bottom" width="9%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">Average
                  Price</div>
              </td>
              <td valign="bottom" width="4%">&#160;</td>
              <td valign="bottom" width="10%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">Revenue</div>
              </td>
              <td valign="bottom" width="4%">&#160;</td>
              <td valign="bottom" width="8%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">Sales
                  Volume</div>
              </td>
              <td valign="bottom" width="3%">&#160;</td>
              <td valign="bottom" width="9%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">Average
                  Price</div>
              </td>
              <td valign="bottom" width="3%">&#160;</td>
              <td valign="bottom" width="9%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">Revenue</div>
              </td>
            </tr>
            <tr>
              <td align="justify" valign="bottom" width="14%">&#160;</td>
              <td align="justify" valign="bottom" width="9%">&#160;</td>
              <td align="justify" valign="bottom" width="4%">&#160;</td>
              <td align="justify" valign="bottom" width="9%">&#160;</td>
              <td align="justify" valign="bottom" width="4%">&#160;</td>
              <td align="justify" valign="bottom" width="10%">&#160;</td>
              <td align="justify" valign="bottom" width="4%">&#160;</td>
              <td align="justify" valign="bottom" width="8%">&#160;</td>
              <td align="justify" valign="bottom" width="3%">&#160;</td>
              <td align="justify" valign="bottom" width="9%">&#160;</td>
              <td align="justify" valign="bottom" width="3%">&#160;</td>
              <td align="justify" valign="bottom" width="9%">&#160;</td>
            </tr>
            <tr>
              <td align="justify" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">Gas-mcf</div>
              </td>
              <td align="justify" valign="bottom" width="9%">&#160;</td>
              <td align="justify" valign="bottom" width="4%">&#160;</td>
              <td align="justify" valign="bottom" width="9%">&#160;</td>
              <td align="justify" valign="bottom" width="4%">&#160;</td>
              <td align="justify" valign="bottom" width="10%">&#160;</td>
              <td align="justify" valign="bottom" width="4%">&#160;</td>
              <td align="justify" valign="bottom" width="8%">&#160;</td>
              <td align="justify" valign="bottom" width="3%">&#160;</td>
              <td align="justify" valign="bottom" width="9%">&#160;</td>
              <td align="justify" valign="bottom" width="3%">&#160;</td>
              <td align="justify" valign="bottom" width="9%">&#160;</td>
            </tr>
            <tr>
              <td align="justify" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">San
                  Juan</div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">62,515</div>
              </td>
              <td align="right" valign="bottom" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">10.81</div>
              </td>
              <td align="right" valign="bottom" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">675,800</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">68,500</div>
              </td>
              <td align="right" valign="bottom" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">7.66</div>
              </td>
              <td align="right" valign="bottom" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">524,700</div>
              </td>
            </tr>
            <tr>
              <td align="justify" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">Other</div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">41,000</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">8.20</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">336,200</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">48,480</div>
              </td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">6.13</div>
              </td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">297,200</div>
              </td>
            </tr>
            <tr>
              <td align="justify" valign="bottom" width="14%">&#160;</td>
              <td align="right" valign="bottom" width="9%">&#160;</td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="9%">&#160;</td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="10%">&#160;</td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="8%">&#160;</td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">&#160;</td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">&#160;</td>
            </tr>
            <tr>
              <td align="justify" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">Oil-barrels</div>
              </td>
              <td align="right" valign="bottom" width="9%">&#160;</td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="9%">&#160;</td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="10%">&#160;</td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="8%">&#160;</td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">&#160;</td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">&#160;</td>
            </tr>
            <tr>
              <td align="justify" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">San
                  Juan</div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">110</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">49.09</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">5,400</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">105</div>
              </td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">28.58</div>
              </td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">3,000</div>
              </td>
            </tr>
            <tr>
              <td align="justify" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">Other</div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">1,565</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">54.31</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">85,000</div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">2,030</div>
              </td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">39.41</div>
              </td>
              <td align="right" valign="bottom" width="3%">&#160;</td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">80,000</div>
              </td>
            </tr>

        </table>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">Revenue increased due to higher prices.&#160;
The higher prices more than offset the decline
      in production as indicated
      above.&#160; San Juan natural gas is sold at an index price that is set at the
      first of every month and remains in effect for the entire month.&#160; Our San
      Juan March 2006 price is about $7.26 per MCF.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; tab-stops: decimal 3.0in 3.7in 5.0in 5.7in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; tab-stops: decimal 3.0in 3.7in 5.0in 5.7in">Interest
      income increased due to investing the proceeds from the sale that occurred
      in
      September 2004.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; tab-stops: decimal 3.0in 3.7in 5.0in 5.7in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; tab-stops: decimal 3.0in 3.7in 5.0in 5.7in">General
      and administrative expenses declined due to the termination of two employees
      after the California property sale, and salary reductions in the Denver
      office.&#160; Our CEO's salary was reduced 26% and certain other employees'
      salaries were reduced 10%.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; tab-stops: decimal 3.0in 3.7in 5.0in 5.7in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in -18.3pt 0in 18.3pt .5in right 127.4pt 162.8pt left 205.3pt 215.9pt right 346.9pt 392.9pt"><u><strong>Critical
      Accounting Policies and Estimates</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">We
      believe the following critical accounting policies affect our more significant
      judgments and estimates used in the preparation of our financial
      statements.</font></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">11</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt"><u><strong>Successful Efforts Method of
      Accounting</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">We account for our exploration and development
      activities utilizing the successful efforts method of accounting. Under this
      method, costs of productive exploratory wells, development dry holes and
      productive wells and undeveloped leases are capitalized. Oil and gas lease
      acquisition costs are also capitalized. Exploration costs, including personnel
      costs, certain geological and geophysical expenses and delay rentals for oil
      and
      gas leases, are charged to expense as incurred. Exploratory drilling costs
      are
      initially capitalized, but charged to expense if and when the well is determined
      not to have found reserves in commercial quantities. The sale of a partial
      interest in a proved property is accounted for as a cost recovery and no gain
      or
      loss is recognized as long as this treatment does not significantly affect
      the
      unit-of-production amortization rate. A gain or loss is recognized for all
      other
      sales of producing properties. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">The application of the successful efforts
      method of accounting requires managerial judgment to determine the proper
      classification of wells designated as developmental or exploratory which will
      ultimately determine the proper accounting treatment of the costs incurred.
      The
      results from a drilling operation can take considerable time to analyze and
      the
      determination that commercial reserves have been discovered requires both
      judgment and industry experience. Wells may be completed that are assumed to
      be
      productive and actually deliver oil and gas in quantities insufficient to be
      economic, which may result in the abandonment of the wells at a later date.
      Wells are drilled that have targeted geologic structures that are both
      developmental and exploratory in nature and an allocation of costs is required
      to properly account for the results.&#160; The evaluation of oil and gas
      leasehold acquisition costs requires managerial judgment to estimate the fair
      value of these costs with reference to drilling activity in a given area.
      Drilling activities in an area by other companies may also effectively condemn
      leasehold positions.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
      successful efforts method of accounting can have a significant impact on the
      operational results reported when we enter a new exploratory area in hopes
      of
      finding an oil and gas field that will be the focus of future development
      drilling activity. The initial exploratory wells may be unsuccessful and will
      be
      expensed. Seismic costs can be substantial which will result in additional
      exploration expenses when incurred.</font></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><u><strong>Reserve Estimates</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">Our estimates of oil and gas reserves, by
      necessity, are projections based on geologic and engineering data, and there
      are
      uncertainties inherent in the interpretation of such data as well as the
      projection of future rates of production and the timing of development
      expenditures. Reserve engineering is a subjective process of estimating
      underground accumulations of oil and gas that are difficult to measure. The
      accuracy of any reserve estimate is a function of the quality of available
      data,
      engineering and geological interpretation and judgment. Estimates of
      economically recoverable oil and gas reserves and future net cash flows
      necessarily depend upon a number of variable factors and assumptions, such
      as
      historical production from the area compared with production from other
      producing areas, the assumed effects of regulations by governmental agencies
      and
      assumptions governing future oil and gas prices, future operating costs,
      severance taxes, development costs and workover costs, all of which may in
      fact
      vary considerably from actual results. The future drilling costs associated
      with
      reserves assigned to proved undeveloped locations may ultimately increase to
      an
      extent that these reserves may be later determined to be uneconomic. For these
      reasons, estimates </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
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    <div style="MARGIN: 0in 0in 0pt">of the economically recoverable quantities
      of
      oil and gas attributable to any particular group of properties, classifications
      of such reserves based on risk of recovery, and estimates of the future net
      cash
      flows expected therefrom may vary substantially. Any significant variance in
      the
      assumptions could materially affect the estimated quantity and value of the
      reserves, which could affect the carrying value of our oil and gas properties
      and/or the rate of depletion of the oil and gas properties. Actual production,
      revenues and expenditures with respect to our reserves will likely vary from
      estimates, and such variances may be material.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><u><strong>Impairment of Developed Oil and
      Gas
      Properties</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">We review our oil and gas properties for
      impairment whenever events and circumstances indicate a decline in the
      recoverability of their carrying value. We estimate the expected future cash
      flows of our oil and gas properties and compare such future cash flows to the
      carrying amount of our oil and gas properties to determine if the carrying
      amount is recoverable.&#160; If the carrying amount exceeds the estimated
      undiscounted future cash flows, we will adjust the carrying amount of the oil
      and gas properties to their fair value. The factors used to determine fair
      value
      include, but are not limited to, estimates of proved reserves, future commodity
      pricing, future production estimates, anticipated capital expenditures, and
      a
      discount rate commensurate with the risk associated with realizing the expected
      cash flows projected. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><u><strong>Impairment of Unproved Oil and
      Gas
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    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">We periodically assess individually significant
      unproved oil and gas properties for impairment, on a project-by-project
      basis.&#160; Our assessment of the results of exploration activities, commodity
      price outlooks, planned future sales or expiration of all or a portion of such
      projects impact the amount and timing of impairment provisions. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><u><strong>New Accounting
      Pronouncements</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">In
      December 2004, the FASB issued SFAS 123(R) that requires that the compensation
      cost relating to share-based payment transactions be recognized in the financial
      statements.&#160; That cost will be measured based on the fair value of the
      equity or liability instrument issued.&#160; SFAS 123(R) covers a wide range of
      share-based awards, stock appreciation rights, and employee stock purchase
      plans. SFAS 123(R) replaces SFAS 123, "Accounting for Stock-Based Compensation,"
      and supersedes APB Opinion 25, "Accounting for Stock Issued to Employees."&#160;
We will be required to apply SFAS 123(R) in the first quarter 2006, and will
      use
      the modified prospective method of adoption.&#160; We had $1,035,000 of unvested
      compensation related to outstanding stock options and estimate having to expense
      $115,000 during the first quarter of 2006.</font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">None of the other FASB pronouncements issued
      during the last two years had, or will have, any effect on us.</div><br clear="all">
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
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        </div>
      </div>
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    </div>
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      7.&#160; FINANCIAL STATEMENTS </strong></div>
    <div style="MARGIN: 0in 0in 0pt 0.25in; TEXT-INDENT: -0.25in; mso-hyphenate: none; tab-stops: -1.0in -.5in -18.3pt 0in .5in right 127.4pt 162.8pt left 205.3pt 215.9pt right 346.9pt 392.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt 0.25in; TEXT-INDENT: -0.25in; mso-hyphenate: none; tab-stops: -1.0in -.5in -18.3pt 0in .5in right 127.4pt 162.8pt left 205.3pt 215.9pt right 346.9pt 392.9pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center"><strong>INDEX
      TO CONSOLIDATED FINANCIAL STATEMENTS</strong></div>
    <div style="TEXT-ALIGN: center" align="center"><font style="FONT-FAMILY: Arial"><br></font>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td align="left" valign="top" width="77%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Report
                  of Independent Registered Public Accounting Firm</font></div>
              </td>
              <td align="right" valign="top" width="6%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">15</font></div>
              </td>
              <td align="right" valign="top" width="5%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="77%">&#160;</td>
              <td align="right" valign="top" width="6%">&#160;</td>
              <td align="right" valign="top" width="5%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="77%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Consolidated
                  Balance Sheet, December 31, 2005</font></div>
              </td>
              <td align="right" valign="top" width="6%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">16</font></div>
              </td>
              <td align="right" valign="top" width="5%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="77%">&#160;</td>
              <td align="right" valign="top" width="6%">&#160;</td>
              <td align="right" valign="top" width="5%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="77%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Consolidated
                  Statement of Operations, Years ended December 31, 2005 and
                  2004</font></div>
              </td>
              <td align="right" valign="top" width="6%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">17</font></div>
              </td>
              <td align="right" valign="top" width="5%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="77%">&#160;</td>
              <td align="right" valign="top" width="6%">&#160;</td>
              <td align="right" valign="top" width="5%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="77%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Consolidated
                  Statement of Cash Flows, Years ended December 31, 2005 and
                  2004</font></div>
              </td>
              <td align="right" valign="top" width="6%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">18</font></div>
              </td>
              <td align="right" valign="top" width="5%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="77%">&#160;</td>
              <td align="right" valign="top" width="6%">&#160;</td>
              <td align="right" valign="top" width="5%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="77%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Notes
                  to Consolidated Financial Statements</font></div>
              </td>
              <td align="right" valign="top" width="6%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">19</font></div>
              </td>
              <td align="right" valign="top" width="5%">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div>&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">14</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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          </div>
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    </div>
    <div style="TEXT-ALIGN: center" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; tab-stops: 6.75in">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</div><br clear="all">
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center"><strong>REPORT
      OF INDEPENDENT REGISTERED</strong></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center"><strong>PUBLIC
      ACCOUNTING FIRM</strong></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">To
      the Board of Directors and Stockholders</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">Hallador
      Petroleum Company</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">Denver,
      Colorado</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">We
      have audited the consolidated balance sheet of Hallador Petroleum Company and
      Subsidiaries as of December 31, 2005 and the consolidated statements of
      operations and cash flows for the years ended December 31, 2005 and 2004. These
      consolidated financial statements are the responsibility of the Company's
      management. Our responsibility is to express an opinion on these consolidated
      financial statements based on our audits.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">We
      conducted our audits in accordance with standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audit to obtain reasonable assurance about whether the
      consolidated financial statements are free of material misstatement. The Company
      is not required to have, nor were we engaged to perform, an audit of its
      internal control over financial reporting. Our audit included consideration
      of
      internal control over financial reporting as a basis for designing audit
      procedures that are appropriate in the circumstances, but not for the purpose
      of
      expressing an opinion on the effectiveness of the Company&#8217;s internal control
      over financial reporting. Accordingly, we express no such opinion. An audit
      includes examining, on a test basis, evidence supporting the amounts and
      disclosures in the consolidated financial statements. An audit also includes
      assessing the accounting principles used and significant estimates made by
      management, as well as evaluating the overall consolidated financial statement
      presentation. We believe that our audits provide a reasonable basis for our
      opinion.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">In
      our opinion, the consolidated financial statements referred to above present
      fairly, in all material respects, the financial condition of Hallador Petroleum
      Company and Subsidiaries, as of December 31, 2005 and the results of their
      operations and their cash flows for the years ended December 31, 2005 and 2004,
      in conformity with accounting principles generally accepted in the United States
      of America.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">/s/
      Ehrhardt Keefe Steiner &amp; Hottman PC</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">March
      31, 2006 </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in">Denver,
      Colorado</div>
    <div>&#160;</div>
    <div><br clear="all">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">15</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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        </div>
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    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in" align="center">&#160;<strong>Consolidated
      Balance Sheet</strong></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">December
      31, 2005</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">(in
      thousands)</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">
    </div>
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            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">ASSETS</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 1;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Current
                assets:</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 2;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 12pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Cash
                and cash equivalents</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">12,261</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 3;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 12pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Accounts
                receivable-</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 4;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 25.5pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Oil
                and gas sales</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">950</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 5;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 25.5pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Well
                operations</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">1,198</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 6;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 39pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Total
                current assets</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 11.65pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">14,409</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 7;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 8;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Oil
                and gas properties, at cost (successful efforts):</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 9;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 12pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Unproved
                properties</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">2,909</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 10;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 12pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Proved
                properties</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">2,388</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 11;">
            <td valign="bottom" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 12pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Less
                &#8211; accumulated depreciation, depletion, amortization and
                impairment</font></div>
            </td>
            <td valign="bottom" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 11.65pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(1,776)</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 12.1pt; mso-yfti-irow: 12;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 12.1pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">3,521</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 13;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Investment
                in CELLC</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">223</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 14;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Investment
                in Savoy</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">4,205</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 15;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Other
                assets</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 11.65pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">246</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 12.1pt; mso-yfti-irow: 16;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 12.1pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">22,604</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 12.1pt; mso-yfti-irow: 17;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt; mso-border-top-alt: double windowtext 1.5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 18;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">LIABILITIES
                AND STOCKHOLDERS&#8217; EQUITY</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 19;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Current
                liabilities:</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 20;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 16.5pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Accounts
                payable and accrued liabilities</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">1,346</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 21;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 16.5pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Oil
                and gas sales payable</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">1,494</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 22;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 16.5pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Income
                tax payable</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">208</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 23;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 39pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Total
                current liabilities</font></div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 11.65pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">3,048</font></div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 24;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt; mso-border-top-alt: solid windowtext .5pt;">
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 25;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt">Stockholders&#8217; equity:</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 26;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 16.5pt">Preferred stock, $.10 par
                value;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 27;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 25.5pt">10,000,000 shares authorized;
                none
                issued</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 28;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 16.5pt">Common stock, $ .01 par value;
                100,000,000</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 29;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 25.5pt">shares authorized, 8,986,319
                shares issued</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">90</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 30;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 16.5pt">Additional paid-in
                capital</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">22,207</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 31;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt 16.5pt">Accumulated deficit</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 11.65pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(2,741)</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 11.65pt; mso-yfti-irow: 32;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 11.65pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">19,556</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 11.65pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 12.1pt; mso-yfti-irow: 33; mso-yfti-lastrow: yes;">
            <td valign="top" width="528" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 5.5in; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 12.1pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">22,604</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">See
      accompanying notes.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">16</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">
    </div><br clear="all">
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center"><strong>Consolidated
      Statement of Operations</strong></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">(in
      thousands)</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center">&#160;</div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 1.5pt 0in 1.5pt; mso-table-layout-alt: fixed">

          <tr style="height: 14.75pt; mso-yfti-irow: 0; mso-yfti-firstrow: yes; page-break-inside: avoid;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="4" valign="top" width="192" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 2in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">Years
                ended December 31,</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 1;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">2005</div>
            </td>
            <td colspan="2" valign="top" width="48" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.5in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">2004</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 2; page-break-inside: avoid;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Revenue:</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="4" valign="top" width="192" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 2in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 3;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Gas</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">1,012</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">822</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 4;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Oil</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">90</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">83</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 5;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Interest</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">544</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">167</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 6;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">1,646</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">1,072</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 7;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Costs and expenses:</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 16.2pt; mso-yfti-irow: 8;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Lease operating</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">227</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">149</div>
            </td>
          </tr>
          <tr style="height: 16.2pt; mso-yfti-irow: 9;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Delay rentals</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">57</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">102</div>
            </td>
          </tr>
          <tr style="height: 16.2pt; mso-yfti-irow: 10;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Impairment &#8211; unproved
                properties</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">183</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">144</div>
            </td>
          </tr>
          <tr style="height: 16.2pt; mso-yfti-irow: 11;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Equity loss in CELLC </div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">103</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 16.2pt; mso-yfti-irow: 12;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Depreciation, depletion and
                amortization</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">43</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">42</div>
            </td>
          </tr>
          <tr style="height: 16.2pt; mso-yfti-irow: 13;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">General and
                administrative</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 16.2pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">612</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 16.2pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">852</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 14;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">1,225</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">1,289</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 15;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 16;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Income (loss) &#160;from continuing
                operations before minority interest</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">421</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 3pt 0pt 0in; TEXT-ALIGN: right" align="right">(217)</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 17;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Minority interest</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(84)</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">65</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 18;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Income (loss) from continuing operations
                before taxes</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">337</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 3pt 0pt 0in; TEXT-ALIGN: right" align="right">(152)</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 19;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Income tax-current</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(145)</div>
            </td>
            <td valign="top" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 20;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt">Income (loss) from continuing
                operations</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">192</div>
            </td>
            <td valign="bottom" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 3pt 0pt 0in; TEXT-ALIGN: right" align="right">(152)</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 21;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 22;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt; TEXT-INDENT: -13.5pt">Income
                (loss) &#160;from discontinued operations net of minority interest of
                $(18) and $592</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(30)</div>
            </td>
            <td valign="bottom" width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">1,380</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 23;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 16.2pt; mso-yfti-irow: 24;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">Gain on sale of discontinued operations,
                net of taxes of $1,085 and minority interest of $4,168 </div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">8,642</div>
            </td>
          </tr>
          <tr style="height: 16.2pt; mso-yfti-irow: 25;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 16.2pt; mso-yfti-irow: 26;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt">Net income</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 16.2pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">162</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 16.2pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 16.2pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">9,870</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 27;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt">Net Income (loss) &#160;per share &#8211;
                basic</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 28;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Continuing operations</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">.027</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 3pt 0pt 0in; TEXT-ALIGN: right" align="right">(.02)</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 29;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Discontinued operations</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(.004)</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">.19</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 30;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Gain on sale of discontinued
                operations</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">1.22</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 31;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt 27pt">Net earnings per share</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 15.5pt; mso-border-bottom-alt: double windowtext 1.5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">.023</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 15.5pt; mso-border-bottom-alt: double windowtext 1.5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">1.39</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 32;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 15.5pt; mso-yfti-irow: 33; mso-yfti-lastrow: yes;">
            <td valign="top" width="506" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 379.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt">Weighted average shares
                outstanding-basic</div>
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="2" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 15.5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">7,155</div>
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 27pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 15.5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">7,093</div>
            </td>
          </tr>
          <tr>
            <td width="506" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="12" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="36" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: .25in .5in .75in 1.0in right 431.1pt" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: .25in .5in .75in 1.0in right 431.1pt" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: .25in .5in .75in 1.0in right 431.1pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">See
      accompanying notes.</font></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">17</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in .25in .5in .75in 1.0in right 431.1pt" align="center"><strong>Consolidated
      Statement of Cash Flows</strong></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">(in
      thousands)</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt .5in 54.9pt 1.0in 91.5pt 1.5in 128.1pt 146.4pt 164.7pt 183.0pt right dotted 431.85pt left blank 6.5in" align="center">&#160;</div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 1.5pt 0in 1.5pt; mso-table-layout-alt: fixed">

          <tr style="height: 14.75pt; mso-yfti-irow: 0; mso-yfti-firstrow: yes;">
            <td colspan="2" valign="bottom" width="518" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 388.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td colspan="4" valign="bottom" width="222" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 166.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">Years
                ended December 31,</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 1;">
            <td colspan="2" valign="bottom" width="518" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 388.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">
              </div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">2005</div>
            </td>
            <td colspan="2" valign="bottom" width="54" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 40.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">2004</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 2;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Cash flows from operating
                activities:</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 3;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Net income </div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">162</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">9,870</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 4;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Equity loss in CELLC</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">103</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 5;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Depreciation, depletion, and
                amortization</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">43</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">721</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 6;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Minority interest</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">66</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">4,695</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 7;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Impairment of undeveloped
                properties</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">183</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">144</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 8;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Change in accounts
                receivable</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(1,197)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">812</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 9;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 27pt; TEXT-INDENT: -13.5pt">Gain on
                sale
                of discontinued operations exclusive of $1,705 of bonuses paid in
                connection with sale</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(15,600)</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 10;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Change in payables and accrued
                liabilities</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">1,235</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(623)</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 11;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Income taxes payable</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(92)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">300</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 12;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Key employee bonus plan</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(253)</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 13;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Other</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">10</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">90</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 14;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 31.5pt">Net cash provided by operating
                activities</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">513</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">156</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 15;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.05pt; mso-yfti-irow: 16;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.05pt;">
              <div style="MARGIN: 0in 0in 0pt">Cash flows from investing
                activities:</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.05pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.05pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.05pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.05pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.05pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 13.1pt; mso-yfti-irow: 17;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Proceeds from property sale
                (Cuyama)*</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">3,538</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">18,110</div>
            </td>
          </tr>
          <tr style="height: 13.1pt; mso-yfti-irow: 18;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Investment in COALition</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(326)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 13.1pt; mso-yfti-irow: 19;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Investment in Savoy</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(4,205)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 13.1pt; mso-yfti-irow: 20;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Decrease in bonds</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">252</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 13.1pt; mso-yfti-irow: 21;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Properties</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(4,696)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(253)</div>
            </td>
          </tr>
          <tr style="height: 13.1pt; mso-yfti-irow: 22;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Prospect sale</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">1,616</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 13.1pt; mso-yfti-irow: 23;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Other assets</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(35)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 13.1pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 13.1pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(100)</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 24;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 31.5pt">Net cash (used in) provided
                by&#160; investing activities</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(3,856)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">17,757</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 25;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 26;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Cash flows from financing
                activities:</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 27;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Repurchase of employee stock
                options</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(407)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(1,305)</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 28;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Distributions to limited
                partners</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(8,081)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 29;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 13.5pt">Stock sale to Yorktown Energy
                VI,
                L.P.</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">4,165</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 30;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt 31.5pt">Net cash used in financing
                activities</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(4,323)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(1,305)</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 31;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: windowtext 1pt solid; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 32;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Net (decrease) increase in cash and
                cash
                equivalents</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 7.5pt 0pt 0in; TEXT-ALIGN: right" align="right">(7,666)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">16,608</div>
            </td>
          </tr>
          <tr style="height: 14.75pt; mso-yfti-irow: 33;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt">Cash and cash equivalents, beginning
                of
                year</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">19,927</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 14.75pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 14.75pt; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">3,319</div>
            </td>
          </tr>
          <tr style="height: 15.35pt; mso-yfti-irow: 34;">
            <td valign="bottom" width="500" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 375pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.35pt;">
              <div style="MARGIN: 0in 0in 0pt">Cash and cash equivalents, end of
                year</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.35pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 15.35pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">12,261</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 15.35pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8; height: 15.35pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 1.5pt; border-top: #ece9d8; padding-left: 1.5pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; height: 15.35pt;">
              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">19,927</div>
            </td>
          </tr>
          <tr style="height: 15.35pt; mso-yfti-irow: 35;">
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              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
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              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
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              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
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              <div style="MARGIN: 0in 12pt 0pt 0in; TEXT-ALIGN: right" align="right">785</div>
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    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">------------------------</div>
    <div style="MARGIN: 0in 0in 0pt; tab-stops: .25in"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><sup>*
      In
      2004 we received a $3,500,000 note receivable in connection with the sale of
      Cuyama, which was a non-cash investing activity.</sup></font></div>
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    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0pt; tab-stops: .25in" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;<font size="3">See
      accompanying notes.</font></font></div>
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      <div id="FTR">
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">18</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
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    </div>
    <div style="MARGIN: 0in 0in 0pt; tab-stops: .25in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 7.3pt 14.6pt 21.95pt 29.25pt 36.6pt right 261.0pt 4.5in 382.5pt 6.25in 7.0in 576.9pt left 8.5in" align="center"><strong>Notes
      to Consolidated Financial Statements</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 18.3pt 36.6pt 54.9pt 73.2pt 91.5pt 109.8pt right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in .5in right 359.85pt 431.85pt left 6.5in"><strong>(1)&#160;&#160;&#160;&#160;&#160;&#160;
      <u>SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</u></strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><u><strong>Basis
      of Presentation and Consolidation</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">The
      accompanying consolidated financial statements include the accounts of Hallador
      Petroleum Company and its subsidiaries.&#160; All significant intercompany
      accounts and transactions have been eliminated.&#160; We are engaged in the
      exploration, development, and production of oil and natural gas in the Rocky
      Mountain region.&#160; We also have a 32% equity interest in an oil and gas
      company which has operations in Michigan.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">As discussed in Item 6. (MD&amp;A), we have
      entered into significant related party transactions with the Yorktown group
      of
      companies.&#160; Yorktown and its affiliates currently own about 54% of our
      common stock and represents one of the five seats on our board.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">In early January 2006, we signed a Letter of
      Intent with Sunrise Coal, LLC (Sunrise) in order to effect a
      reorganization/merger between Hallador and Sunrise, a private company not
      affiliated with the Yorktown group of companies.&#160; We are working on a
      formal agreement which we hope to execute sometime in the second quarter
      2006.&#160; In late February 2006, we sold&#160;3,181,816 shares for $2.20 per
      share (about $7 million) to our existing shareholders. &#160;The proceeds will
      provide working capital for the Sunrise transaction.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">During the first quarter of 2006, we loaned
      Sunrise $7 million in order for Sunrise to begin development of their second
      coal mine (the "Carlisle mine").&#160;&#160; Their Howesville mine began
      producing coal in November 2005.&#160; Both mines are located in
      Indiana.&#160;&#160; During the second quarter of 2006, Sunrise expects to enter
      into a $30 million line-of- credit with two Indiana banks, at which time our
      $7
      million will be repaid.&#160; We have agreed to guarantee this $30 million
      line-of-credit.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">We
      have concluded to deemphasize our oil and gas operations and concentrate our
      future efforts in the coal business.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">About
      nine years ago, Yorktown Energy Partners II and affiliates (Yorktown) invested
      $5,025,000 in Hallador Petroleum, LLP, a newly formed limited liability limited
      partnership, (the "Partnership").&#160; We are the general partner and received
      a 70% interest in the partnership in return for contributing our net assets
      and
      Yorktown representing the limited partners, received a 30% interest for its
      $5,025,000 cash contribution.&#160; During the third quarter of 2005, we
      purchased the limited partners interest in the Partnership, and for accounting
      purposes the Partnership no longer exists and, as a result, there is no longer
      a
      minority interest caption on our balance sheet.&#160; Prior to this transaction
      we, as general partner, consolidated the activity of the Partnership and
      presented the 30% limited partners&#8217; interest as a minority interest.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">On August 10, 2004, we entered into an
      agreement with E&amp;B Natural Resources Management Corporation (a private
      company) to sell all of our interest in the South Cuyama field and adjacent
      exploration areas, all located in Santa Barbara County, California, for $23
      million; consisting of $19.5 million in cash and an interest bearing (3.5%)
      note
      of $3.5 million due on September 30, 2005, which was paid.&#160; Closing
      occurred on September 30, 2004 and we recorded a pre-tax gain of about $14
      million.&#160; Results from the South Cuyama field have been presented as
      discontinued operations in the accompanying Consolidated Statement of
      Operations; revenue and expenses before the minority interest were about $7
      million and $5 million, respectively for 2004.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in -.5in 0in 18.3pt .5in 54.9pt 1.0in">&#160;</div>
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      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">19</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
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    <div style="MARGIN: 0in 0in 0pt">Due to the sale, our board of directors and
      the
      Executive Committee of the Partnership, voted to discontinue new partnership
      operations effective October 1, 2004.&#160; At that time,&#160; the
      Partnership's assets consisted of cash, the $3.5 million note receivable, oil
      and gas properties in New Mexico and Texas, and other miscellaneous
      assets.&#160; On October 1, 2004, our&#160; board of directors and the Executive
      Committee of the Partnership, valued the oil and gas properties in New Mexico
      and Texas and the other miscellaneous assets at $4 million. On May 6, 2005
      we
      made a cash distribution of about $5.2 million to the limited partners.&#160;
During the third quarter 2005, we purchased the limited partners' interest
      in
      the Partnership for about $1.2 million and made a final cash distribution to
      the
      limited partners of $1.6 million.&#160; After these transactions, about $1.7
      million remained in the minority interest account and was recorded as a
      reduction in our accumulated deficit account. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">In late March 2005, we invested $325,000 for
      a
      29% interest in a newly formed entity called COALition Energy, LLC (CELLC)
      to
      pursue coal opportunities in the United States.&#160; Some of our officers and
      directors also invested in CELLC. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><u><strong>Oil
      and Gas Properties</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">We
      account for our oil and gas activities using the successful efforts method
      of
      accounting.&#160; Under the successful efforts method, the costs of successful
      wells, development dry holes and productive leases are capitalized and amortized
      on a units-of-production basis over the remaining life of the related
      reserves.&#160; Exploratory dry hole costs and other exploratory costs,
      including geological and geophysical costs, and delay rentals are expensed
      as
      incurred.&#160; Cost centers for amortization purposes are determined on a
      field-by-field basis.&#160; Unproved properties with significant acquisition
      costs are periodically assessed for impairment in value, with any impairment
      charged to expense.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">Prior
      to 2003, the estimated costs of plugging and abandoning wells were accrued
      using
      the units-of-production method and were considered in determining DD&amp;A
      expense.&#160; However, in 2003 we adopted SFAS 143, Accounting for Asset
      Retirement Obligations.&#160; Under this standard, we record the fair value of
      the future abandonment as capitalized abandonment costs in Oil and Gas
      properties with an offsetting abandonment liability.&#160; The adoption of this
      method was not significant to our continuing operations.&#160; The capitalized
      abandonment costs are amortized with other property costs using the
      units-of-production method.&#160; </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">The
      carrying value of each field is assessed for impairment on a quarterly
      basis.&#160; If estimated future undiscounted net revenues are less than the
      recorded amounts, an impairment charge is recorded based on the estimated fair
      value of the field.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><u><strong>Statement
      of Cash Flows</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">Cash
      equivalents include investments, which includes mutual funds, with maturities
      when purchased of three months or less.</div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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      <div id="HDR">
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    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><u><strong>Income
      Taxes</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">Income
      taxes are provided based on the liability method of accounting pursuant to
      SFAS
      109, Accounting for Income Taxes.&#160; The provision for income taxes is based
      on pretax financial taxable income.&#160; Deferred tax assets and liabilities
      are recognized for the future expected tax consequences of temporary differences
      between income tax and financial reporting and principally relate to differences
      in the tax basis of assets and liabilities and their reported amounts, using
      enacted tax rates in effect for the year in which differences are expected
      to
      reverse.&#160; If it is more likely than not that some portion or all of a
      deferred tax asset will not be realized, a valuation allowance is
      recognized.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><u><strong>Earnings
      per Share</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">We
      follow the provisions of SFAS 128, Earnings Per Share.&#160; Basic earnings per
      share are computed based on the weighted average number of common shares
      outstanding.&#160; Diluted earnings per share are computed based on the weighted
      average number of common shares outstanding adjusted for the incremental shares
      attributed to outstanding stock options.&#160; </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><u><strong>Use
      of Estimates in the Preparation of Financial Statements</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
      preparation of financial statements in conformity with generally accepted
      accounting principles requires us to make estimates and assumptions that affect
      the reported amounts of assets and liabilities and disclosure of contingent
      assets and liabilities at the date of the financial statements, and the reported
      amounts of revenue and expenses during the reporting period.&#160; Actual
      amounts could differ from those estimates.</font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u><strong>Revenue
      Recognition</strong></u></font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">We
      recognize oil and natural gas revenue from our interest in producing wells
      as
      natural gas and oil is produced and sold from those wells using the entitlement
      method.</font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u><strong>Concentration
      of Credit Risk</strong></u></font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Our
      revenues are derived principally from uncollateralized sales to two customers
      in
      the oil and gas industry.&#160; The concentration of credit risk in a single
      industry affects our overall exposure to credit risk because customers may
      be
      similarly affected by changes in economic and other conditions.</font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in" align="left">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><u><strong>Stock
      Based Compensation</strong></u></div>
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    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-pagination: widow-orphan">On
      April 15, 2005, we issued 750,000 ten-year options to employees at an exercise
      price of $2.25.&#160; The exercise price was based on the sales price of a March
      2005 private stock transaction between one of our shareholders and a third
      party.&#160; These options vest at 1/3 per year over the next three years.&#160;
There are no more options available for issuance.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-pagination: widow-orphan">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-pagination: widow-orphan">As
      allowed in SFAS 123, Accounting for Stock-Based Compensation, we continue to
      apply APB 25, Accounting for Stock Issued to Employees, and related
      interpretations in recording compensation related to our plan.&#160; Had
      compensation costs for the plan been determined consistent with SFAS 123, we
      would have estimated the fair value of the option grant using the Black-Scholes
      option-pricing model, using the following assumptions for the 2005 grants:
      (i)
      risk free interest rate of 4.24%; (ii) expected life of 10 years; (iii) expected
      volatility of 120%; (iv) expected default rate of 5%, and (v) no dividend
      yield.&#160; The average fair value of options granted during 2005 was
      $2.15.&#160; Pro forma loss for the year ended December 31, 2005 would have been
      $183,000 or $(0.03) per share.&#160; Pro forma results for 2004 were
      immaterial.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify; mso-pagination: widow-orphan">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt 0.5in; TEXT-INDENT: -0.5in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">No
      grants
      were issued during 2004.&#160; </font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">21</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in" align="left">
      <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: justify">On October 8, 2004 we
        purchased back 749,723 outstanding employee stock options at a price equal
        to
        $2.80 per share minus the exercise price of each option for a total amount
        of
        $1,305,000.&#160; </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u><strong>Changes
      in Stockholders' Equity</strong></u></font></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td align="left" valign="top" width="50%">&#160;</td>
              <td align="left" valign="top" width="4%">&#160;</td>
              <td valign="top" width="12%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">000's</div>
              </td>
              <td valign="top" width="24%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="50%">&#160;</td>
              <td align="right" valign="top" width="4%">&#160;</td>
              <td align="right" valign="top" width="12%">&#160;</td>
              <td align="right" valign="top" width="24%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="50%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">Stockholders'
                  Equity December 31, 2004</div>
              </td>
              <td align="right" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="top" width="12%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 17.1pt" align="right">13,507</div>
              </td>
              <td align="right" valign="top" width="24%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="50%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">Proceeds
                  from stock sale (1,893,169 shares)</div>
              </td>
              <td align="right" valign="top" width="4%">&#160;</td>
              <td align="right" valign="top" width="12%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 17.1pt" align="right">4,165</div>
              </td>
              <td align="right" valign="top" width="24%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="50%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">Minority
                  interest balance</div>
              </td>
              <td align="right" valign="top" width="4%">&#160;</td>
              <td align="right" valign="top" width="12%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 17.1pt" align="right">1,722</div>
              </td>
              <td align="right" valign="top" width="24%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="50%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">Net
                  income</div>
              </td>
              <td align="right" valign="top" width="4%">&#160;</td>
              <td align="right" valign="top" width="12%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 17.1pt" align="right">162</div>
              </td>
              <td align="right" valign="top" width="24%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="50%">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Stockholders'
                    Equity December 31, 2005</font></div>
                </div>
              </td>
              <td align="right" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="top" width="12%" style="border-bottom: black double;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 17.1pt" align="right">19,556</div>
              </td>
              <td align="right" valign="top" width="24%">&#160;</td>
            </tr>

        </table>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Net
        income was the only change in stockholders' equity during
        2004.</font></div>
    </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><u><strong>New Accounting
      Pronouncements</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">In
      December 2004, the FASB issued SFAS 123(R) that requires that the compensation
      cost relating to share-based payment transactions be recognized in the financial
      statements.&#160; That cost will be measured based on the fair value of the
      equity or liability instrument issued.&#160; SFAS 123(R) covers a wide range of
      share-based awards, stock appreciation rights, and employee stock purchase
      plans. SFAS 123(R) replaces SFAS 123, "Accounting for Stock-Based Compensation,"
      and supersedes APB Opinion 25, "Accounting for Stock Issued to Employees."&#160;
We will be required to apply SFAS 123(R) in the first quarter 2006, and will
      use
      the modified prospective method of adoption.&#160; We had $1,035,000 of unvested
      compensation related to outstanding stock options and estimate having to expense
      $115,000 during the first quarter of 2006.</font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left" align="left">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">None
      of
      the other FASB pronouncements issued during the last two years had, or will
      have, any effect on us.</font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in" align="left">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">22</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in .5in right 359.85pt 431.85pt left 6.5in" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>(2)&#160;&#160;&#160;&#160;&#160;&#160;
      <u>INCOME TAXES (in thousands)</u></strong></font></div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none; tab-stops: -.5in 0in 27.0pt 63.0pt 1.25in right 359.85pt 431.85pt left 6.5in" align="left">&#160;</div>
    <div><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
      provision for income taxes is comprised of the following:</font></div>
    <div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">&#160;</td>
              <td align="left" valign="top" width="5%">&#160;</td>
              <td valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2005</font></div>
              </td>
              <td valign="top" width="3%">&#160;</td>
              <td valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
              </td>
              <td valign="top" width="25%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Current
                  :</font></div>
              </td>
              <td align="left" valign="top" width="5%">&#160;</td>
              <td align="left" valign="top" width="11%">&#160;</td>
              <td align="left" valign="top" width="3%">&#160;</td>
              <td align="left" valign="top" width="11%">&#160;</td>
              <td align="left" valign="top" width="25%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Federal</font></div>
              </td>
              <td align="right" valign="top" width="5%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
              </td>
              <td align="right" valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 11.2pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">415</font></div>
              </td>
              <td align="right" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
              </td>
              <td align="right" valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">265</font></div>
              </td>
              <td align="right" valign="top" width="25%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">State</font></div>
              </td>
              <td align="right" valign="top" width="5%">&#160;</td>
              <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 11.2pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">189</font></div>
              </td>
              <td align="right" valign="top" width="3%">&#160;</td>
              <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">361</font></div>
              </td>
              <td align="right" valign="top" width="25%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">&#160;</td>
              <td align="right" valign="top" width="5%">&#160;</td>
              <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 11.2pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">604</font></div>
              </td>
              <td align="right" valign="top" width="3%">&#160;</td>
              <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">626</font></div>
              </td>
              <td align="right" valign="top" width="25%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Deferred:</font></div>
              </td>
              <td align="right" valign="top" width="5%">&#160;</td>
              <td align="right" valign="top" width="11%">&#160;</td>
              <td align="right" valign="top" width="3%">&#160;</td>
              <td align="right" valign="top" width="11%">&#160;</td>
              <td align="right" valign="top" width="25%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Federal</font></div>
              </td>
              <td align="right" valign="top" width="5%">&#160;</td>
              <td align="right" valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(297)</font></div>
              </td>
              <td align="right" valign="top" width="3%">&#160;</td>
              <td align="right" valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">297</font></div>
              </td>
              <td align="right" valign="top" width="25%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">State</font></div>
              </td>
              <td align="right" valign="top" width="5%">&#160;</td>
              <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(162)</font></div>
              </td>
              <td align="right" valign="top" width="3%">&#160;</td>
              <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">162</font></div>
              </td>
              <td align="right" valign="top" width="25%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">&#160;</td>
              <td align="right" valign="top" width="5%">&#160;</td>
              <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(459)</font></div>
              </td>
              <td align="right" valign="top" width="3%">&#160;</td>
              <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">459</font></div>
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              <td align="right" valign="top" width="25%">&#160;</td>
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            <tr>
              <td align="left" valign="top" width="7%">&#160;</td>
              <td align="left" valign="top" width="24%">&#160;</td>
              <td align="right" valign="top" width="5%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 11.2pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">145</font></div>
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              <td align="right" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
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              <td align="right" valign="top" width="11%" style="border-bottom: black double;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 11.2pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,085</font></div>
              </td>
              <td align="right" valign="top" width="25%">&#160;</td>
            </tr>

        </table>
      </div>
    </div>
    <div>&#160;</div>
    <div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
        net
        deferred tax asset at December 31, 2005 was not material.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Our
        income tax is different than the expected amount computed using the applicable
        federal statutory income tax rate of 35% and a California state tax rate
        of
        8.84%. The reasons for and effects of such differences are as
        follows:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr>
                <td align="left" valign="top" width="51%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="left" valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td valign="top" width="11%" style="border-bottom: black thin solid;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">2005</font></div>
                </td>
                <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td valign="top" width="11%" style="border-bottom: black thin solid;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">2004</font></div>
                </td>
                <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              </tr>
              <tr>
                <td align="left" valign="top" width="51%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              </tr>
              <tr>
                <td align="left" valign="top" width="51%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Expected
                    amount</font></div>
                </td>
                <td align="right" valign="top" width="5%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$</font></div>
                </td>
                <td align="right" valign="top" width="11%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">115</font></div>
                </td>
                <td align="right" valign="top" width="3%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$</font></div>
                </td>
                <td align="right" valign="top" width="11%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">4,864</font></div>
                </td>
                <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              </tr>
              <tr>
                <td align="left" valign="top" width="51%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Utilization
                    of tax net operating losses</font></div>
                </td>
                <td align="right" valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="right" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(2,174)</font></div>
                </td>
                <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              </tr>
              <tr>
                <td align="left" valign="top" width="51%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Utilization
                    of statutory depletion carry forwards</font></div>
                </td>
                <td align="right" valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="right" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(974)</font></div>
                </td>
                <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              </tr>
              <tr>
                <td align="left" valign="top" width="51%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">State
                    income taxes, net of federal benefit</font></div>
                </td>
                <td align="right" valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">16</font></div>
                </td>
                <td align="right" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(340)</font></div>
                </td>
                <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              </tr>
              <tr>
                <td align="left" valign="top" width="51%" style="border-bottom: #ffffff solid;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Change
                    in valuation allowance and other</font></div>
                </td>
                <td align="right" valign="top" width="5%" style="border-bottom: #ffffff solid;"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">14</font></div>
                </td>
                <td align="right" valign="top" width="3%" style="border-bottom: #ffffff solid;"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="11%" style="border-bottom: black thin solid;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(291)</font></div>
                </td>
                <td align="right" valign="top" width="4%" style="border-bottom: #ffffff solid;"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              </tr>
              <tr>
                <td align="left" valign="top" width="51%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td align="right" valign="top" width="5%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$</font></div>
                </td>
                <td align="right" valign="top" width="11%" style="border-bottom: black double;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">145</font></div>
                </td>
                <td align="right" valign="top" width="3%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$</font></div>
                </td>
                <td align="right" valign="top" width="11%" style="border-bottom: black double;">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">1,085</font></div>
                </td>
                <td align="right" valign="top" width="4%">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">At
          December 31, 2005, we had no federal or state net operating
          loss, alternative minimum tax or statutory depletion carry forwards as
          all
          amounts were utilized during the current fiscal year.</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in .5in right 252.5pt 359.85pt 431.85pt left 6.5in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>(3)&#160;&#160;&#160;&#160;&#160;&#160;
      <u>STOCK OPTIONS AND BONUS PLANS</u></strong></font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in"><u><strong>Stock
      Option Plan</strong></u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">On October 8, 2004, we purchased back 749,723
      outstanding employee stock options at a price equal to $2.80 per share minus
      the
      exercise price of each option for a total amount of $1,305,000.&#160; The
      options were cancelled and available for reissuance.&#160; The $1,305,000 was
      expensed during 2004.&#160; At December 31, 2004 there were no options
      outstanding.&#160; All options were granted at fair value.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">In
      April 2005, we issued 750,000 options at an exercise price of $2.25 based on
      a
      March 2005 private transaction between one of our shareholders and a third
      party.&#160; These options vest at 1/3 per year for the next three years and
      expire in April 2015.&#160; There are no more options available for
      issuance.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">Options
      to purchase up to 3% of the partnership interest in Hallador Petroleum, LLP
      were
      issued in 1997 and 1998.&#160; As of December 31, 2004, 2.692% were outstanding
      and exercisable.&#160; The exercise price for these options was based on the
      fair market value on the date of grant.&#160; On January 8, 2005 we purchased
      back all of these outstanding options for a total of $407,000, which was accrued
      for as of December 31, 2004.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">23</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in .5in right 252.5pt 359.85pt 431.85pt left 6.5in"><strong>(4)&#160;&#160;&#160;&#160;&#160;&#160;
      <u>MAJOR CUSTOMERS</u></strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">During
      2005 and 2004, the San Juan Basin&#8217;s gas and NGL production was purchased by
      Coral Energy Resources, LP and Williams Energy Services.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in"><strong>(5)&#160;&#160;&#160;&#160;&#160;&#160;
      <u>EQUITY INVESTMENT IN SAVOY</u></strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">In August 2005, we began negotiations to
      purchase from Yorktown Energy Partners II, LP its 32% interest in Savoy Energy
      LLP, a private company engaged in the oil and gas business primarily in the
      State of Michigan.&#160; A purchase price of $4.1 million was agreed upon and
      closing occurred on December 31, 2005.&#160; On December 20, 2005 we sold about
      1,893,000 shares of our common stock to Yorktown Energy Partners VI, &#160;L.P.
      at $2.20 per share (about $4.1 million).&#160; We will account for our interest
      in Savoy using the equity method of accounting.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; tab-stops: 63.0pt">Below (in thousands)
      are:&#160;&#160; (i) a condensed balance sheet at December 31, 2005, and (ii) a
      condensed statement of operations for the year ended December 31, 2005.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
        &#160;Condensed Balance Sheet</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td align="left" valign="top" width="10%">&#160;</td>
              <td align="left" valign="top" width="34%">&#160;</td>
              <td align="right" valign="top" width="3%">&#160;</td>
              <td align="right" valign="top" width="10%">&#160;</td>
              <td align="right" valign="top" width="33%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%">&#160;</td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">Current
                  assets</div>
              </td>
              <td align="right" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="top" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 6.3pt" align="right">12,393</div>
              </td>
              <td align="right" valign="top" width="33%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%">&#160;</td>
              <td align="left" valign="top" width="34%">
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              </td>
              <td align="right" valign="top" width="3%">&#160;</td>
              <td align="right" valign="top" width="10%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 6.3pt" align="right">8,306</div>
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              <td align="right" valign="top" width="33%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%" style="border-bottom: #ffffff solid;">&#160;</td>
              <td align="left" valign="top" width="34%" style="border-bottom: #ffffff solid;">&#160;</td>
              <td align="right" valign="top" width="3%" style="border-bottom: #ffffff solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="top" width="10%" style="border-bottom: black double;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 6.3pt" align="right">20,699</div>
              </td>
              <td align="right" valign="top" width="33%" style="border-bottom: #ffffff solid;">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%">&#160;</td>
              <td align="left" valign="top" width="34%">&#160;</td>
              <td align="right" valign="top" width="3%">&#160;</td>
              <td align="right" valign="top" width="10%">&#160;</td>
              <td align="right" valign="top" width="33%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%">&#160;</td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">Total&#160;liabilities</div>
              </td>
              <td align="right" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="top" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 6.3pt" align="right">5,450</div>
              </td>
              <td align="right" valign="top" width="33%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%" style="border-bottom: #ffffff solid;">&#160;</td>
              <td align="left" valign="top" width="34%" style="border-bottom: #ffffff solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">Partners
                  capital</div>
              </td>
              <td align="right" valign="top" width="3%" style="border-bottom: #ffffff solid;">&#160;</td>
              <td align="right" valign="top" width="10%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 6.3pt" align="right">15,249</div>
              </td>
              <td align="right" valign="top" width="33%" style="border-bottom: #ffffff solid;">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%">&#160;</td>
              <td align="left" valign="top" width="34%">&#160;</td>
              <td align="right" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">$</div>
              </td>
              <td align="right" valign="top" width="10%" style="border-bottom: black double;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 6.3pt" align="right">20,699</div>
              </td>
              <td align="right" valign="top" width="33%">&#160;</td>
            </tr>

        </table>
      </div>
      <div>&#160;</div>
      <div>&#160;</div>
      <div><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
        Condensed Statement Of Operations</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td align="left" valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Revenue</font></div>
              </td>
              <td align="right" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$</font></div>
              </td>
              <td align="right" valign="top" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">6,038</font></div>
              </td>
              <td align="right" valign="top" width="33%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Gain
                  on sale</font></div>
              </td>
              <td align="right" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="right" valign="top" width="10%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">3,133</font></div>
              </td>
              <td align="right" valign="top" width="33%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="top" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="right" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="right" valign="top" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">9,171</font></div>
              </td>
              <td align="right" valign="top" width="33%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="top" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="right" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="right" valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="right" valign="top" width="33%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Expenses</font></div>
              </td>
              <td align="right" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="right" valign="top" width="10%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 3.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(4,364)</font></div>
              </td>
              <td align="right" valign="top" width="33%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Net
                  income</font></div>
              </td>
              <td align="right" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$</font></div>
              </td>
              <td align="right" valign="top" width="10%" style="border-bottom: black double;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">4,807</font></div>
              </td>
              <td align="right" valign="top" width="33%">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    </div>
    <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">No
      equity
      income was recorded as closing on occurred on December 31, 2005.</font></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">Any difference between the purchase price and
      our pro rata share of the equity of Savoy will be amortized based on Savoy's
      units of production rate.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">24</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: .5in" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>(6)&#160;&#160;&#160;&#160;&#160;&#160;
      <u>RESERVE DATA (UNAUDITED)</u></strong></font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">Our
      reserve estimates for the years ended December 31, 2005 and 2004 were prepared
      by a sole-proprietor consulting petroleum engineer based on data we
      supplied.&#160; Savoy's reserve estimates were prepared by Netherland, Sewell
&amp; Associates.&#160; Be cautious that there are many uncertainties inherent
      in estimating proved reserve quantities and in projecting future production
      rates.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in right 252.5pt 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in 0in 7.3pt 14.6pt 21.95pt 33.3pt right 3.25in 333.0pt 423.0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Proved
      reserves are the estimated quantities of oil and natural gas which geological
      and engineering data demonstrate with reasonable certainty to be recoverable
      in
      future years from known reservoirs under existing economic and operating
      conditions.&#160; Proved developed reserves are those reserves expected to be
      recovered through existing wells with existing equipment and operating
      methods.</font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in 0in 7.3pt 14.6pt 21.95pt 33.3pt right 3.25in 333.0pt 423.0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in 0in 7.3pt 14.6pt 21.95pt 33.3pt right 3.25in 333.0pt 423.0pt">&#160;</div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-table-layout-alt: fixed">

          <tr style="height: 14.25pt; mso-yfti-irow: 0; mso-yfti-firstrow: yes; page-break-inside: avoid;">
            <td colspan="5" valign="top" width="613" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 459.9pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.25pt;">
              <div align="center"><u><strong>Analysis of Changes in Proved Developed
                Reserves *</strong></u></div>
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">(in
                thousands)</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 14.25pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">&#160;</div>
            </td>
          </tr>
          <tr style="height: 14.25pt; mso-yfti-irow: 1; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.25pt;">
              <div align="center">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.25pt;">
              <div align="center">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.25pt;">
              <div align="center">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; height: 14.25pt;">
              <div align="center">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 14.25pt;">
              <div align="center">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="FONT-FAMILY: Arial">Oil</font></div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="FONT-FAMILY: Arial">Gas</font></div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div>&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 3; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">(BBLs)</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">(MCF)</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Balance at December 31, 2003</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">1,557</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">2,384</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 5; page-break-inside: avoid; mso-row-margin-left: 23.4pt;">
            <td width="31" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="378" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 283.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Revisions of previous estimates </div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">--</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(266)</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 6; page-break-inside: avoid; mso-row-margin-left: 23.4pt;">
            <td width="31" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="378" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 283.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Discoveries</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">--</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">141</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 7; page-break-inside: avoid; mso-row-margin-left: 23.4pt;">
            <td width="31" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="378" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 283.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Production</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(162)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(280)</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 8; page-break-inside: avoid; mso-row-margin-left: 23.4pt;">
            <td width="31" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="378" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 283.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Cuyama sale</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(1,392)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(546)</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 9; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Balance at December 31, 2004</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">3</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">1,433</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 10; page-break-inside: avoid; mso-row-margin-left: 23.4pt;">
            <td width="31" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="378" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 283.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Revisions of previous estimates </div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(1)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(41)</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 11; page-break-inside: avoid; mso-row-margin-left: 23.4pt;">
            <td width="31" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="378" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 283.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Discoveries</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">112</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 12; page-break-inside: avoid; mso-row-margin-left: 23.4pt;">
            <td width="31" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="378" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 283.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Production</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(2)</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(104)</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 13; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Balance at December 31, 2005<sup>
                (1)</sup></div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: windowtext 1pt solid; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-bottom-alt: double windowtext 1.5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">0</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: windowtext 1pt solid; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-bottom-alt: double windowtext 1.5pt; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">1,400</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 14; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: double windowtext 1.5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: double windowtext 1.5pt;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 15; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">*We have no significant proved
                undeveloped reserves.</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 16; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 17; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Equity interest (32%) in Savoy's
                Reserves:</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 18; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 19; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Proved developed</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">22</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">634</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 20; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: double windowtext 1.5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: double windowtext 1.5pt;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 21; mso-yfti-lastrow: yes; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="409" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 306.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Proved undeveloped</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">43</div>
            </td>
            <td valign="bottom" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="84" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 63pt; padding-top: 0in; border-bottom: windowtext 1.5pt double;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">712</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr>
            <td width="31" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="378" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="90" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="30" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="84" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="72" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">---------------------------</div>
    <div style="MARGIN: 0in 0in 0pt"><sup>(1)</sup> Our oil reserves are not
      material.</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">25</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div><br clear="all">
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">The following table (in
      thousands) sets forth a standardized measure of the discounted future net cash
      flows attributable to our proved developed reserves (hereinafter referred to
      as
      "SMOG"). Future cash inflows were computed using December 31, 2005 and 2004
      gas
      prices of $8.69 and $6.06, respectively.&#160; Future production costs represent
      the estimated future expenditures to be incurred in producing the reserves,
      assuming continuation of economic conditions existing at year-end.&#160;
Discounting the annual net cash inflows at 10% illustrates the impact of timing
      on these future cash inflows.&#160; </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-table-layout-alt: fixed">

          <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">2005</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: center" align="center">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">2004</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 1; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Future gas revenue</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">12,350</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">8,200</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 3; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 12.6pt">Future cash outflows &#8211; production
                and abandonment costs</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(3,600)</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(2,800)</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Future income taxes</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(3,500)</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(2,100)</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 5; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Future net cash flows</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">5,250</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">3,300</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 6; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">10% discount factor</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(2,450)</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(1,500)</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 7; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="463" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 347.4pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">SMOG</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">2,800</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">1,800</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 8; page-break-inside: avoid;">
            <td colspan="2" valign="top" width="463" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 347.4pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: double windowtext 1.5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: double windowtext 1.5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 9; mso-yfti-lastrow: yes; page-break-inside: avoid;">
            <td colspan="2" valign="bottom" width="463" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 347.4pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Equity interest (32%) in Savoy</div>
              <div style="MARGIN: 0in 0in 0pt">(About 50% relates to proved undeveloped
                reserves)</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">4,400</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr>
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="458" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="90" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="22" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="90" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
      following table (in thousands) summarizes the principal factors comprising
      the
      changes in SMOG:</font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-table-layout-alt: fixed">

          <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">2005</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: center" align="center">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center" align="center">2004</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 1; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 11.2pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2; page-break-inside: avoid; mso-row-margin-left: .9pt;">
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td colspan="2" valign="top" width="462" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 346.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">SMOG, beginning of year</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">1,800</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">11,500</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 3; page-break-inside: avoid; mso-row-margin-left: .2in;">
            <td colspan="2" width="19" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="444" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 333pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Sales of oil and gas, net of production
                costs</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(875)</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(3,600)</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4; page-break-inside: avoid; mso-row-margin-left: .2in;">
            <td colspan="2" width="19" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="444" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 333pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Net changes in prices and production
                costs</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">2,160</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(350)</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 5; page-break-inside: avoid; mso-row-margin-left: .2in;">
            <td colspan="2" width="19" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="444" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 333pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Revisions</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(165)</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(300)</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 6; page-break-inside: avoid; mso-row-margin-left: .2in;">
            <td colspan="2" width="19" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="444" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 333pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Discoveries</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">450</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">100</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 7; page-break-inside: avoid; mso-row-margin-left: .2in;">
            <td colspan="2" width="19" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="444" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 333pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Change in income taxes</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(750)</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(1,200)</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 8; page-break-inside: avoid; mso-row-margin-left: .2in;">
            <td colspan="2" width="19" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="444" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 333pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Accretion of discount</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt -5.4pt; TEXT-ALIGN: right" align="right">180</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">1,150</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 9; page-break-inside: avoid; mso-row-margin-left: .2in;">
            <td colspan="2" width="19" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 0in; border-top: #ece9d8; padding-left: 0in; padding-bottom: 0in; border-left: #ece9d8; padding-top: 0in; border-bottom: #ece9d8; mso-cell-special: placeholder;">
              <div style="MARGIN: 0in 0in 0pt">&#160;</div>
            </td>
            <td valign="top" width="444" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 333pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">Cuyama sale</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">--</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 8.1pt 0pt 0in; TEXT-ALIGN: right" align="right">(5,500)</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 10; mso-yfti-lastrow: yes; page-break-inside: avoid;">
            <td colspan="3" valign="bottom" width="463" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 347.4pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt">SMOG, end of year</div>
            </td>
            <td valign="top" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">2,800</div>
            </td>
            <td valign="bottom" width="24" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.25in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.9pt 0pt 0in; TEXT-ALIGN: right" align="right">$</div>
            </td>
            <td valign="top" width="90" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 67.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 12.6pt 0pt 0in; TEXT-ALIGN: right" align="right">1,800</div>
            </td>
          </tr>
          <tr>
            <td width="1" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="18" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="440" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="90" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="24" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="22" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
            <td width="90" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -1.0in 0in 7.3pt 14.6pt 21.95pt 33.3pt right 369.0pt 477.0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 7.3pt 14.6pt right 364.5pt 423.0pt left 6.5in right 477.0pt">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">26</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt 63pt; TEXT-INDENT: -63pt; mso-hyphenate: none; tab-stops: 63.0pt"><strong>ITEM
      8.&#160;&#160;&#160;&#160;&#160;&#160; CHANGES IN AND DISAGREEMENTS WITH
      ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE</strong></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">Not applicable<strong>.</strong></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: 63.0pt"><strong>ITEM
      8A.&#160;&#160;&#160;&#160; CONTROLS AND PROCEDURES</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">We
      maintain a system of disclosure controls and procedures that are designed for
      the purposes of ensuring that information required to be disclosed in our SEC
      reports is recorded, processed, summarized and reported within the time periods
      specified in the SEC's rules and forms, and that such information is accumulated
      and communicated to our CEO as appropriate to allow timely decisions regarding
      required disclosure.</font></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">As of the end of the period covered by this
      report, we carried out an evaluation, under the supervision and with the
      participation of our CEO of the effectiveness of the design and operation of
      our
      disclosure controls and procedures. Based upon that evaluation, our CEO, who
      is
      also our CFO, concluded that our disclosure controls and procedures are
      effective for the purposes discussed above. There have been no changes in our
      internal controls or in other factors that could significantly affect these
      controls subsequent to the date of the evaluation. </div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 7.3pt 1.0in right 364.5pt 423.0pt left 6.5in right 477.0pt"><strong>ITEM
      8B.&#160;&#160;&#160;&#160;&#160;&#160; OTHER INFORMATION</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">None.</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center">27</div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div><br clear="all">
    <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none" align="center"><strong>PART
      III</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in .25in right 368.15pt 438.95pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt 1in; TEXT-INDENT: -1in; TEXT-ALIGN: left; tab-stops: -.5in 1.0in right 368.15pt 438.95pt left 6.5in" align="left"><strong><font style="FONT-FAMILY: Arial">ITEM
      9.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; DIRECTORS, EXECUTIVE
      OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE
      EXCHANGE ACT</font></strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in .25in right 368.15pt 438.95pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: .5in; mso-list: none">CORTLANDT
      S. DIETLER, 84, has been one of our directors since November 1995.&#160; From
      April 1995 to October 1999 he was CEO of TransMontaigne Inc. and is currently
      Chairman of the Board.&#160; He also serves as a director of Forest Oil
      Corporation, Cimarex Energy Company and Nytis Exploration Company.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-pagination: widow-orphan">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-pagination: widow-orphan; mso-layout-grid-align: none">DAVID
      HARDIE, 55 is the Chairman of the Board and has served as a director since
      July
      1989.&#160; He is the President of Hallador Investment Advisors Inc., which
      manages Hallador Equity Fund, Hallador Fixed Income Fund, Hallador Alternative
      Assets Fund and Hallador Balance Fund; he also is a General Partner of Hallador
      Venture Partners LLC, the General Partner of Hallador Venture Fund II &amp;
III.&#160; Mr. Hardie is and serves as a director and partner of other private
      entities that are owned by members of his family. Mr. Hardie is a graduate
      of
      California Polytechnic University, San Luis Obispo and Harvard Business School,
      OPM. </div>
    <div style="MARGIN: 0in 0in 0pt; mso-pagination: widow-orphan; mso-layout-grid-align: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-pagination: widow-orphan; mso-layout-grid-align: none">STEVEN
      HARDIE, 52 has been a director since 1994.&#160; He and David Hardie are
      brothers.&#160; For the last 22 years he has been an investor in common stock
      and private equity.&#160; He is the Vice-President of Hallador Investment
      Advisors, which manages Hallador Equity Fund, Hallador Fixed Income&#160; Fund,
      Hallador Alternative Assets Fund and Hallador Balance Fund. He also serves
      as a
      director and partner of other private entities that are owned by members of
      his
      family.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-pagination: widow-orphan">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: .5in; mso-list: none">BRYAN
      H. LAWRENCE, 62, has been one of our directors since November 1995.&#160; He is
      a founder and senior manager of Yorktown Partners LLC that manages investment
      partnerships formerly affiliated with Dillon, Read &amp; Co. Inc., an
      investment-banking firm (Dillon Read).&#160; He had been employed with Dillon,
      Read since 1966, serving most recently as a Managing Director until the merger
      of Dillon Read with SBC Warburg in September 1997.&#160; He also serves as a
      Director of TransMontaigne, Inc., Crosstex Energy, Inc. and Crosstex Energy,
      L.P. (each a United States public company), Winstar Resources Ltd. ( a Canadian
      Public Company) and certain non-public companies in the energy industry in
      which
      Yorktown partnership holds equity interests including, PetroSantander Inc.,
      Savoy Energy, L.P., Camden Resources, Inc., ESI Energy Services Inc., Ellora
      Energy Inc., Dernick Resources Inc., Cinco Natural Resources Corp., Approach
      Resources Inc., Peak Energy Resources Inc., Nytis Exploration Company, Compass
      Petroleum, Ltd and Momentum Energy Group. Mr. Lawrence is a graduate of Hamilton
      College and has a MBA from Columbia University.</div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: .5in; mso-list: none">VICTOR
      P. STABIO, 58 is our President, CEO, CFO and a director.&#160; He joined us in
      March 1991 as our President and CEO and has been active in the oil and gas
      business for the past 30 years.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: .5in; mso-list: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: .5in; mso-list: none">We
      do not have an audit committee financial expert serving on our audit
      committee.&#160; We believe that the additional costs to recruit a financial
      expert exceed the benefits, if any.</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: .5in; mso-list: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: list .25in; mso-list: none">Our
      Code of Ethics is filed as Exhibit 14 to this Form 10-KSB.

      <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: list .25in; mso-list: none">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: list .25in; mso-list: none"><u><strong>Section
        16(a) Beneficial Ownership Reporting Compliance</strong></u></div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: list .25in; mso-list: none">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: list .25in; mso-list: none">Our
        CEO, Victor Stabio, was late on filing one of his Form 4s.</div>
    </div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">28</font></div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; TEXT-INDENT: 0in; tab-stops: list .25in; mso-list: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 21.95pt 1.0in right 359.85pt 431.85pt left 6.5in"><strong>ITEM
      10.&#160;&#160;&#160;&#160;&#160;&#160;&#160; EXECUTIVE
      COMPENSATION</strong></div>
    <div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td colspan="8" valign="top" width="91%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>SUMMARY
                  COMPENSATION TABLE</strong></font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td colspan="6" valign="bottom" width="51%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u>Annual
                  Compensation</u></font></div>
              </td>
              <td valign="bottom" width="16%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" valign="top" width="23%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u>Name
                  and Principal Position</u></font></div>
              </td>
              <td valign="top" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u>Year</u></font></div>
              </td>
              <td valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u>Salary</u></font></div>
              </td>
              <td align="right" valign="top" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="center">&#160;</div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 12.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u>Bonus
                  </u></font></div>
              </td>
              <td align="right" valign="top" width="4%">&#160;</td>
              <td align="right" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Other
                  Annual <u>Compensation</u></font></div>
              </td>
              <td valign="top" width="4%">&#160;</td>
              <td valign="bottom" width="16%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Stock
                  </font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><u>Options</u></font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="bottom" width="23%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Victor
                  P. Stabio, CEO</font></div>
              </td>
              <td valign="bottom" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">2005</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$100,000</font></div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 3.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$&#160;&#160;&#160;
                  3,846 </font></div>
              </td>
              <td valign="bottom" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
              </td>
              <td align="right" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">$&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
                  0</font></div>
              </td>
              <td align="right" valign="bottom" width="4%">&#160;</td>
              <td valign="bottom" width="16%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">400,000</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="bottom" width="23%">&#160;</td>
              <td valign="bottom" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">2004</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;
                  137,000</font></div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 3.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">632,000</font></div>
              </td>
              <td align="justify" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"><sup>(1)</sup></font></div>
              </td>
              <td align="right" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">1,251,900</font></div>
              </td>
              <td align="justify" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"><sup>(3)</sup></font></div>
              </td>
              <td align="left" valign="top" width="16%">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="bottom" width="23%">&#160;</td>
              <td valign="bottom" width="8%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">2003</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
                  <font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">146,000</font></font></div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 3.6pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">73,500</font></div>
              </td>
              <td align="justify" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"><sup>(1)</sup></font></div>
              </td>
              <td align="right" valign="bottom" width="14%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 8.1pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">6,000</font></div>
              </td>
              <td align="justify" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"><sup>(2)</sup></font></div>
              </td>
              <td align="left" valign="top" width="16%">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><sup>--------------------------------</sup></font></div>
    </div>
    <div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    </div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="MARGIN: auto auto auto 0.2in; BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-yfti-tbllook: 480">

          <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes;">
            <td valign="top" width="27" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 20.3pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><sup>(1)</sup></div>
            </td>
            <td valign="bottom" width="639" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 479.2pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">Relates to the
                Key
                Employee Bonus Plan.</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 1;">
            <td valign="top" width="27" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 20.3pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="639" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 479.2pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2;">
            <td valign="top" width="27" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 20.3pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><sup>(2)</sup></div>
            </td>
            <td valign="bottom" width="639" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 479.2pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">Our contribution
                to
                the 401(k) Plan.</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 3;">
            <td valign="top" width="27" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 20.3pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="bottom" width="639" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 479.2pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4; mso-yfti-lastrow: yes;">
            <td valign="top" width="27" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 20.3pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><sup>(3)</sup></div>
            </td>
            <td valign="bottom" width="639" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 479.2pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">Includes the
                purchase of 545,000 stock options at a cost of $1.80 per option or
                $981,000 in October 2004 and $265,000 for the options to purchase
                1.75% of
                Hallador Petroleum, LLP paid in January
                2005.</div>
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">On April 15, 2005, we
      granted Mr. Stabio 400,000 ten-year options at an exercise price of $2.25 per
      share.&#160; Such options represented 53% of all the options granted to
      employees that year.&#160; </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">At December 31, 2005,
      Mr
      Stabio had 400,000 unexercisable options and the in-the-money value was
      $400,000.&#160; Mr. Stabio did not exercise any options during the
      year.</div><br clear="all">
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">
      <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none"><u><strong>Equity
        Compensation Plan Information</strong></u></div>
      <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
      <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">In April 2005, we granted
        750,000 options at an exercise price of $2.25 per share to our employees
        of
        which 400,000 were issued to Mr. Stabio.&#160; As of December 31, 2005, there
        were 750,000 options outstanding and there were no options outstanding at
        December 31, 2004.</div>
      <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
      <div>
        <table border="1" cellpadding="0" cellspacing="0" style="BORDER-RIGHT: medium none; BORDER-TOP: medium none; MARGIN: auto auto auto 20.15pt; BORDER-LEFT: medium none; BORDER-BOTTOM: medium none; BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-table-layout-alt: fixed; mso-border-alt: solid windowtext .5pt; mso-border-insideh: .5pt solid windowtext; mso-border-insidev: .5pt solid windowtext">

            <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes;">
              <td valign="top" width="177" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 132.6pt; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
              </td>
              <td colspan="2" valign="top" width="178" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 133.75pt; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
              </td>
              <td colspan="2" valign="top" width="176" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 131.75pt; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
              </td>
              <td colspan="2" valign="top" width="177" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 132.55pt; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
              </td>
              <td valign="top" width="17" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 12.6pt; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
              </td>
            </tr>
            <tr style="height: 74.25pt; mso-yfti-irow: 1;">
              <td valign="bottom" width="177" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 132.6pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 74.25pt; mso-border-bottom-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: .5in; mso-pagination: none"><font size="2">Plan
                  Category</font></div>
              </td>
              <td colspan="2" valign="bottom" width="178" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 133.75pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 74.25pt; mso-border-bottom-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none"><font size="2">Number
                  of Securities to be issued upon exercise of outstanding options,
                  warrants
                  and rights</font></div>
                <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: .5in; mso-pagination: none"><font size="2">(a)</font></div>
              </td>
              <td colspan="2" valign="bottom" width="176" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 131.75pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 74.25pt; mso-border-bottom-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none"><font size="2">Weighted-average
                  exercise price of outstanding options, warrants
                  and rights</font></div>
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none"><font size="2">(b)</font></div>
              </td>
              <td colspan="2" valign="bottom" width="177" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 132.55pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 74.25pt; mso-border-bottom-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none"><font size="2">Number
                  of securities remaining available for future issuance under equity
                  compensation plans (excluding securities reflected in column
                  (a))</font></div>
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none"><font size="2">(c)</font></div>
              </td>
              <td valign="top" width="17" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 12.6pt; padding-top: 0in; border-bottom: windowtext 1pt solid; height: 74.25pt; mso-border-bottom-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
              </td>
            </tr>
            <tr style="mso-yfti-irow: 2;">
              <td valign="bottom" width="177" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 132.6pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: .5in; mso-pagination: none">&#160;</div>
                <div style="MARGIN: 0in 0in 0pt; PAGE-BREAK-AFTER: auto; tab-stops: .5in; mso-pagination: none"><font size="2">Equity
                  compensation plans approved by security
                  holders</font></div>
              </td>
              <td valign="bottom" width="116" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 86.65pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><font size="2">750,000</font></div>
              </td>
              <td colspan="2" valign="bottom" width="174" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 130.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><font size="2">$2.25</font></div>
              </td>
              <td colspan="2" valign="bottom" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><font size="2">0</font></div>
              </td>
              <td colspan="2" valign="top" width="96" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1in; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
              </td>
            </tr>
            <tr style="mso-yfti-irow: 3; mso-yfti-lastrow: yes;">
              <td valign="bottom" width="177" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 132.6pt; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
                <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none"><font size="2">Equity
                  compensation plans not approved by security holders</font></div>
              </td>
              <td valign="bottom" width="116" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 86.65pt; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><font size="2">0</font></div>
              </td>
              <td colspan="2" valign="bottom" width="174" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 130.5pt; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><font size="2">0</font></div>
              </td>
              <td colspan="2" valign="bottom" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><font size="2">0</font></div>
              </td>
              <td colspan="2" valign="top" width="96" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1in; padding-top: 0in; border-bottom: #ece9d8;">
                <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
              </td>
            </tr>
            <tr>
              <td width="177" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">&#160;</td>
              <td width="116" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">&#160;</td>
              <td width="63" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">&#160;</td>
              <td width="111" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">&#160;</td>
              <td width="64" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">&#160;</td>
              <td width="98" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">&#160;</td>
              <td width="79" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">&#160;</td>
              <td width="17" bgcolor="transparent" style="border-right: #ece9d8; border-top: #ece9d8; border-left: #ece9d8; border-bottom: #ece9d8;">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    </div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">29</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">&#160;</div>
    </div>
    <div style="MARGIN: 0in 0in 0pt 58.5pt; TEXT-INDENT: -58.5pt; mso-hyphenate: none; tab-stops: -.5in 58.5pt 63.0pt right 359.85pt 431.85pt left 6.5in"><strong>ITEM
      11.&#160;&#160;&#160;SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
      MANAGEMENTAND RELATED STOCKHOLDER MATTERS</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">The following table is
      as
      of April 4, 2006.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div>
      <table border="1" cellpadding="0" cellspacing="0" style="BORDER-RIGHT: medium none; BORDER-TOP: medium none; BORDER-LEFT: medium none; BORDER-BOTTOM: medium none; BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-yfti-tbllook: 480; mso-border-alt: solid windowtext .5pt; mso-border-insideh: .5pt solid windowtext; mso-border-insidev: .5pt solid windowtext">

          <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0in; BORDER-TOP: medium none; PADDING-LEFT: 0in; PADDING-BOTTOM: 1pt; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt; mso-element: para-border-div">
                <div style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0in; BORDER-TOP: medium none; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; MARGIN: 0in 0in 0pt; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: medium none; TEXT-ALIGN: center; mso-hyphenate: none; mso-padding-alt: 0in 0in 1.0pt 0in; mso-border-bottom-alt: solid windowtext .5pt" align="center"><strong>Name</strong></div>
              </div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0in; BORDER-TOP: medium none; PADDING-LEFT: 0in; PADDING-BOTTOM: 1pt; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt; mso-element: para-border-div">
                <div style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0in; BORDER-TOP: medium none; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; MARGIN: 0in 0in 0pt; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: medium none; TEXT-ALIGN: center; mso-hyphenate: none; mso-padding-alt: 0in 0in 1.0pt 0in; mso-border-bottom-alt: solid windowtext .5pt" align="center"><strong>No.
                  Shares</strong><strong><sup>
                  (1)</sup></strong></div>
              </div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0in; BORDER-TOP: medium none; PADDING-LEFT: 0in; PADDING-BOTTOM: 1pt; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt; mso-element: para-border-div">
                <div style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0in; BORDER-TOP: medium none; PADDING-LEFT: 0in; PADDING-BOTTOM: 0in; MARGIN: 0in 0in 0pt; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: medium none; TEXT-ALIGN: center; mso-hyphenate: none; mso-padding-alt: 0in 0in 1.0pt 0in; mso-border-bottom-alt: solid windowtext .5pt" align="center"><strong>%
                  of Class
                  </strong><strong><sup>(1)</sup></strong></div>
              </div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 1;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none" align="left">&#160;</div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; mso-hyphenate: none" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">David
                Hardie and Steven Hardie as Nominee for Hardie Family Members
                <sup>(2)</sup></font></div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">3,573,341</font></div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">29</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 3;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">Victor P.
                Stabio<sup>(6)</sup></div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">208,270</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">2</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 5;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 6;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">Cortlandt S.
                Dietler
                <sup>(3)</sup></div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">100,000</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">1</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 7;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 8;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">Bryan H.
                Lawrence&#160; <sup>(4)</sup></div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">6,607,166</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">54</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 9;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 10;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">Lubar &amp;
                Associates <sup>(5)</sup></div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">823,276</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">7</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 11;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: left; tab-stops: .5in; mso-outline-level: 8" align="left">&#160;</div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 12;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">All directors
                and
                executive officer as a group</div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 17.1pt 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">10,488,777</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.55in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none" align="right">86</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 13; mso-yfti-lastrow: yes;">
            <td valign="top" width="385" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 288.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="144" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 1.5in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="162" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 121.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt 22.5pt; TEXT-INDENT: -17.1pt; mso-hyphenate: none">&#160;</div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-yfti-tbllook: 480">

          <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><sup>(1)</sup></div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none"><font size="2">Based
                on total outstanding shares of 12,168,135.&#160; Beneficial
                ownership of certain shares has been, or is being, specifically disclaimed
                by certain directors in ownership reports filed with the
                SEC.</font></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 1;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><sup>(2)</sup></div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none"><font size="2">The
                Hardie family business address is 3000 S Street, Suite 200,
                Sacramento, California, 95816.</font></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 3;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><sup>(3)</sup></div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none"><font size="2">Mr.
                Dietler&#8217;s address is P. O. Box 5660, Denver, Colorado
                80217.&#160; All shares are held by Pinnacle Engine Company LLC, wholly
                owned by Mr. Dietler.</font></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 5;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 6;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><sup>(4)</sup></div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none"><font size="2">Mr.
                Lawrence&#8217;s address is 410 Park Avenue, 19<sup>th</sup> Floor,
                New York, NY 10022.&#160; Mr. Lawrence owns 50,000 shares directly, and
                the remainder is held by Yorktown Energy Partners VI, L.P., an
                affiliate.</font></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 7;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 8;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><sup>(5)</sup></div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none"><font size="2">Lubar
&amp;
Associates&#160;address
                is 700 North Water Street,
                Suite 1200, Milwaukee, WI 53202.</font></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 9;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 10;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right"><sup>(6)</sup></div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none"><font size="2">Includes
                133,333 options exercisable within sixty days of April 4,
                2006.</font></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 11; mso-yfti-lastrow: yes;">
            <td valign="top" width="37" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 27.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 22.5pt; TEXT-INDENT: -17.1pt; TEXT-ALIGN: right; mso-hyphenate: none" align="right">&#160;</div>
            </td>
            <td valign="top" width="660" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 495pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 0.05in; mso-hyphenate: none">&#160;</div>
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 21.95pt 1.0in right 359.85pt 431.85pt left 6.5in"><strong>ITEM
      12.&#160;&#160;&#160;&#160;&#160;&#160;&#160; CERTAIN RELATIONSHIPS AND RELATED
      TRANSACTIONS</strong></div>
    <div style="MARGIN: 0in 0in 0pt">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt">As discussed in Item 6. (MD&amp;A), we have
      entered into significant related party transactions with the Yorktown group
      of
      companies.&#160; Yorktown and its affiliates currently own about 54% of our
      common stock and represents one of the five seats on our board.</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">30</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR"><strong>ITEM 13.&#160;&#160;&#160;&#160;&#160;&#160;&#160;
EXHIBITS</strong></div>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 21.95pt 37.8pt right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in .5in right 359.85pt 431.85pt left 6.5in"><strong>(a)&#160;&#160;&#160;&#160;&#160;&#160;
      Exhibits</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 7.55pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-yfti-tbllook: 480">

          <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">3.1</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Restated
                Articles of Incorporation of Kimbark Oil and Gas Company, effective
                September 24, 1987&#160; <sup>(1)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 1;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">3.2</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Articles
                of Amendment to Restated Articles of Incorporation of Kimbark Oil
&amp;
                Gas Company, effective December 14, 1989, to effect change of name
                to
                Hallador Petroleum Company and to change the par value and number
                of
                authorized shares of common stock <sup>(1)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">3.3</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Amendment
                to Articles of Incorporation dated December 31, 1990 to effect the
                one-for-ten reverse stock split <sup>(2)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 3;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">3.4</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">By-laws
                of Hallador Petroleum Company, effective November 9, 1993
                <sup>(4)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.1</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Composite
                Agreement and Plan of Merger dated as of July 17, 1989, as amended
                as
                of&#160;&#160; August 24, 1989, among Kimbark Oil &amp; Gas Company, KOG
                Acquisition, Inc., Hallador Exploration Company and Harco Investors,
                with
                Exhibits A, B, C and D <sup>(1)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 5;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.2</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Hallador
                Petroleum Company 1993 Stock Option Plan <sup>*(3)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 6;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.3</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Hallador
                Petroleum Company Key Employee Bonus Compensation Plan
                <sup>*(3)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 7;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.4</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">First
                Amendment to the 1993 Stock Option Plan <sup>*(6)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 8;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.5</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">First
                Amendment to Key Employee Bonus Compensation Plan
                <sup>*(6)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 9;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.6</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Stock
                Purchase Agreement with Yorktown dated November 15, 1995
                <sup>(6)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 10;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.7</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Second
                Amendment to Key Employee Bonus Compensation Plan
                <sup>*(7)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 11;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.8</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Hallador
                Petroleum, LLP Agreement <sup>(9)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 12;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.9</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Hallador
                Petroleum, LLP Stock Option Agreement <sup>*(9)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 13;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.10</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Purchase
                And Sale Agreement Among Hallador Petroleum Company, Hallador Production
                Company, Hallador Petroleum, LLP, Santa Barbara Partners, Trio Petroleum
                Inc., Cuyama Drilling and Production Company And South Cuyama Limited
                Partnership ("Sellers") And E&amp;B Natural Resources Management
                Corporation and WRBD II, LP ("Buyers") <sup>(11)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 14;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.11</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Subscription
                Agreement - by and between Hallador Petroleum Company and Yorktown
                Energy
                Partners VI, L.P, dated December 20, 2005.<sup>(12)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 15;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.12</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Purchase
                and Sale Agreement dated December 31, 2005 between Hallador Petroleum
                Company, as Purchase and Yorktown Energy Partners II, L.P., as Seller
                relating to the purchase and sale of limited partnership interests
                in
                Savoy Energy Limited Partnership<sup> (13)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 16;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.13</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Letter
                of Intent dated January 5, 2006 between Hallador Petroleum Company
                and
                Sunrise Coal, LLC<sup> (14)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 17;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.14</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Subscription
                Agreement - by and between Hallador Petroleum Company and Yorktown
                Energy
                Partners VI, L.P., et al dated February 22, 2006.<sup>
                (15)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 18;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.15</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Subscription
                Agreement - by and between Hallador Petroleum Company and Hallador
                Alternative Assets Fund LLC dated February 14, 2006.<sup>
                (16)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 19;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.16</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Subscription
                Agreement - by and between Hallador Petroleum Company and Tecovas
                Partners
                V LP dated February 14, 2006.<sup> (16)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 20;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.17</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Subscription
                Agreement - by and between Hallador Petroleum Company and&#160;Lubar
                Equity Fund LLC dated February 14, 2006.<sup> (16)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 21;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">10.18</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Subscription
                Agreement - by and between Hallador Petroleum Company and Murchison
                Capital Partners LP dated February 14, 2006.<sup> (16)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 22;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">14.</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">Code
                Of Ethics For Senior Financial Officers. <sup>(16)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 23;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 24.0pt right 359.85pt 431.85pt left 6.5in">21.1</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">List
                of Subsidiaries<sup> (2)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 24;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in right 359.85pt 431.85pt left 6.5in">31</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: -.5in 8.1pt decimal 28.3pt left 56.7pt right 359.85pt 431.85pt left 6.5in">SOX
                302 Certification<sup> (16)</sup></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 25; mso-yfti-lastrow: yes;">
            <td valign="top" width="61" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 45.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in right 359.85pt 431.85pt left 6.5in">32</div>
            </td>
            <td valign="top" width="636" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 477pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 8.1pt; mso-hyphenate: none; tab-stops: 8.1pt right 359.85pt 431.85pt left 6.5in">SOX
                906 Certification <sup>(16)</sup></div>
            </td>
          </tr>

      </table>
    </div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">31</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">&#160;</div>
    </div>
    <div style="MARGIN: 0in 0in 0pt 0.75in; TEXT-INDENT: -45pt; mso-hyphenate: none; tab-stops: -.5in decimal 28.3pt left .75in"><sup>-----------------------------------------------</sup></div>
    <div>&#160;</div>
    <div style="MARGIN: 0in 0pt 0pt; TEXT-INDENT: 0pt; mso-hyphenate: none; tab-stops: -.5in decimal 28.3pt left .75in" align="left">
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1)
                </font><font id="TAB2" style="COLOR: black; LETTER-SPACING: -1.45pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Incorporated
                by reference (IBR) to the 1989 Form 10-K.</font></div>
            </td>
            <td align="left" valign="top" width="44%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(9)
                IBR to the 1997 Form 10-KSB.</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: -1.45pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                IBR to the 1990 Form 10-K.</font></div>
            </td>
            <td align="left" valign="top" width="44%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(10)
                Not used.</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: -1.45pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                IBR to the 1992 Form 10-KSB.</font></div>
            </td>
            <td align="left" valign="top" width="44%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(11)</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                IBR to June 30, 2004 Form 10-QSB.</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: -1.45pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                IBR to the 1993 Form 10-KSB.</font></div>
            </td>
            <td align="left" valign="top" width="44%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(12)</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                IBR to Form 8-K dated December 31, 2005</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(5)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: -1.45pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                Not used.</font></div>
            </td>
            <td align="left" valign="top" width="44%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(13)
                IBR to Form 8-K dated January 3, 2006</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(6)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: -1.45pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                IBR to the 1995 Form 10-KSB.</font></div>
            </td>
            <td align="left" valign="top" width="44%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(14)</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                IBR to Form 8-K dated January 6, 2006</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(7)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: -1.45pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                IBR to the September 30, 1996 Form 10-QSB.</font></div>
            </td>
            <td align="left" valign="top" width="44%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(15)</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
                IBR to Form 8-K dated February 27, 2006</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(8)
                </font><font id="TAB2" style="COLOR: black; LETTER-SPACING: -1.45pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Not
                used. </font></div>
            </td>
            <td align="left" valign="top" width="44%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(16)
                Filed herewith.</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">*
                </font><font id="TAB2" style="COLOR: black; LETTER-SPACING: -1.45pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Management
                contracts or compensatory plans.</font></div>
            </td>
            <td align="left" valign="top" width="44%">&#160;</td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: 1.0in"><strong>ITEM
      14.&#160;&#160;&#160;&#160;&#160;&#160;&#160; PRINCIPAL ACCOUNTANT FEES AND
      SERVICES</strong></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
      fees
      incurred for 2005 and 2004 were: </font></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
    <div>
      <table border="1" cellpadding="0" cellspacing="0" style="BORDER-RIGHT: medium none; BORDER-TOP: medium none; MARGIN: auto auto auto 9.9pt; BORDER-LEFT: medium none; BORDER-BOTTOM: medium none; BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-table-layout-alt: fixed; mso-border-alt: solid windowtext .5pt; mso-border-insideh: .5pt solid windowtext; mso-border-insidev: .5pt solid windowtext">

          <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes; page-break-inside: avoid;">
            <td valign="top" width="354" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 265.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="78" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 58.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in" align="center">2005</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in" align="center">2004</div>
            </td>
            <td valign="top" width="138" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 103.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in" align="center">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 1; page-break-inside: avoid;">
            <td valign="top" width="354" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 265.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="78" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 58.5pt; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="138" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 103.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 2; page-break-inside: avoid;">
            <td valign="top" width="354" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 265.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">Audit
                Fees</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">$</div>
            </td>
            <td valign="top" width="78" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 58.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">64,500</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">$</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">56,000</div>
            </td>
            <td valign="top" width="138" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 103.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="height: 12.6pt; mso-yfti-irow: 3; page-break-inside: avoid;">
            <td valign="top" width="354" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 265.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.6pt;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">Audit-related
                fees </div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.6pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="78" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 58.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.6pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.6pt;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.6pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8; height: 12.6pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="138" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 103.5pt; padding-top: 0in; border-bottom: #ece9d8; height: 12.6pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 4; page-break-inside: avoid;">
            <td valign="top" width="354" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 265.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">Tax
                fees </div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="78" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 58.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">15,000</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">31,000</div>
            </td>
            <td valign="top" width="138" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 103.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 5; page-break-inside: avoid;">
            <td valign="top" width="354" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 265.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">All
                other fees</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="78" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 58.5pt; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1pt solid; mso-border-bottom-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
            <td valign="top" width="138" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 103.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 6; mso-yfti-lastrow: yes; page-break-inside: avoid;">
            <td valign="top" width="354" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 265.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt 12.6pt; mso-hyphenate: none; tab-stops: -.5in">Total
                fees </div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">$</div>
            </td>
            <td valign="top" width="78" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 58.5pt; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">79,500</div>
            </td>
            <td valign="top" width="18" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 13.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
            </td>
            <td valign="top" width="30" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 22.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">$</div>
            </td>
            <td valign="top" width="72" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.75in; padding-top: 0in; border-bottom: windowtext 1.5pt double; mso-border-top-alt: solid windowtext .5pt;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">87,000</div>
            </td>
            <td valign="top" width="138" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 103.5pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0in 0pt; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in" align="right">&#160;</div>
            </td>
          </tr>

      </table>
    </div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none"><u>Pre-approval
      Policy</u></div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">In 2003 the Audit
      Committee adopted a formal policy concerning approval of audit and non-audit
      services to be provided by Ehrhardt Keefe Steiner &amp; Hottman PC (EKSH).&#160;
The policy requires that all services EKSH provides to us be pre-approved by
      the
      Committee.&#160; The Committee approved all services provided by EKSH during
      2005 and 2004.</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">32</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="2">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div><br clear="all">
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 7.55pt 21.2pt 28.3pt 56.7pt right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in 0in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 7.55pt 21.2pt 28.3pt 56.7pt right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in -0.2in 0pt 0in; TEXT-ALIGN: center; mso-hyphenate: none; tab-stops: -.5in 0in 7.55pt 14.15pt 21.2pt 28.3pt 56.7pt right 359.85pt 431.85pt left 6.5in" align="center"><strong>SIGNATURES</strong></div>
    <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 7.55pt 14.15pt 21.2pt 28.3pt 56.7pt right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 7.55pt 14.15pt 21.2pt 28.3pt 56.7pt right 359.85pt 431.85pt left 6.5in">In
      accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
      this report to be signed on our behalf by the undersigned, thereunto duly
      authorized.</div>
    <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 7.55pt 14.15pt 21.2pt 28.3pt 56.7pt right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 7.55pt 14.15pt 21.2pt 28.3pt 56.7pt right 359.85pt 431.85pt left 6.5in">&#160;</div>
    <div>
      <table border="0" cellpadding="0" cellspacing="0" style="BORDER-COLLAPSE: collapse; mso-padding-alt: 0in 5.4pt 0in 5.4pt; mso-yfti-tbllook: 480">

          <tr style="mso-yfti-irow: 0; mso-yfti-firstrow: yes;">
            <td valign="top" width="245" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 2.55in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="86" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.9in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="403" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 4.2in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none"><strong>HALLADOR
                PETROLEUM COMPANY</strong></div>
            </td>
          </tr>
          <tr style="mso-yfti-irow: 1;">
            <td valign="top" width="245" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 2.55in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none">&#160;</div>
            </td>
            <td valign="top" width="86" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 0.9in; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none">&#160;</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in">Dated:&#160;
                April 14, 2006</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in">BY:/S/
                VICTOR P. STABIO</div>
              <div style="MARGIN: 0in -0.2in 0pt 0.3in; mso-hyphenate: none; tab-stops: -.5in">VICTOR
                P. STABIO, CEO</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none">&#160;</div>
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    <div style="MARGIN: 0in -0.2in 0pt; mso-hyphenate: none; tab-stops: -.5in 0in 7.55pt 22.65pt 56.7pt 116.8pt 322.2pt right 359.85pt 431.85pt left 6.5in">In
      accordance with the Exchange Act, this report has been signed below by the
      following persons on behalf of the registrant and in the capacities and on
      the
      dates indicated.</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">/S/
                DAVID HARDIE&#160; </div>
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">DAVID
                HARDIE</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">Chairman</div>
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              <div style="MARGIN: 0in 0.25in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in" align="right">April
                14, 2006</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">&#160;</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">&#160;</div>
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              <div style="MARGIN: 0in 0.25in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in" align="right">&#160;</div>
            </td>
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          <tr style="mso-yfti-irow: 2;">
            <td valign="top" width="313" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 234.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">/S/
                VICTOR P. STABIO</div>
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">VICTOR
                P. STABIO</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">CEO,
                CFO, CAO and Director</div>
            </td>
            <td valign="top" width="169" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 126.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.25in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in" align="right">April
                14, 2006</div>
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            <td valign="top" width="313" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 234.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">&#160;</div>
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            <td valign="top" width="252" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 189pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">&#160;</div>
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              <div style="MARGIN: 0in 0.25in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in" align="right">&#160;</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">/S/
                BRYAN LAWRENCE</div>
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                LAWRENCE</div>
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              <div style="MARGIN: 0in -0.2in 0pt 0in; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in">Director</div>
            </td>
            <td valign="top" width="169" bgcolor="transparent" style="border-right: #ece9d8; padding-right: 5.4pt; border-top: #ece9d8; padding-left: 5.4pt; padding-bottom: 0in; border-left: #ece9d8; width: 126.9pt; padding-top: 0in; border-bottom: #ece9d8;">
              <div style="MARGIN: 0in 0.25in 0pt 0in; TEXT-ALIGN: right; mso-hyphenate: none; tab-stops: -.5in 0in 171.0pt 391.5pt 6.5in" align="right">April
                14, 2006</div>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-14
<SEQUENCE>2
<FILENAME>exh14.htm
<DESCRIPTION>EXHIBIT 14 -CODE OF ETHICS FOR SENIOR FINANCIAL OFFICERS
<TEXT>
<html>
  <head>
    <title>
      Exhibit 14 -Code of Ethics for Senior Financial Officers
</title>
<!-- Licensed to: Hallador Petroleum Company-->
<!-- Document Created using EDGARIZER HTML 3.0.3.0 -->
<!-- Copyright 2005 EDGARfilings, Ltd., an IEC company.-->
<!-- All rights reserved EDGARfilings.com -->
</head>
  <body bgcolor="#ffffff">
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>EXHIBIT
      14</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>CODE
      OF ETHICS FOR SENIOR FINANCIAL OFFICERS</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">I.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Introduction</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
      Code
      of Ethics for Senior Financial Officers (the &#8220;Code&#8221;) has been adopted by the
      Board of Directors (the &#8220;Board&#8221;) of Hallador Petroleum Company (the &#8220;Company&#8221;)
      to promote honest and ethical conduct, proper disclosure of financial
      information in the Company's periodic reports, and compliance with applicable
      laws, rules, and regulations by the Company's senior officers who have financial
      responsibilities.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">II.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Applicability</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      used
      in this Code, the term Senior Financial Officer means the Company's Chief
      Executive Officer, who is also the Chief Financial Officer (CFO).</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">III.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Principles
      and Practices</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      performing his duties, the CFO must:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 63pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A.&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">maintain
                high standards of honest and ethical conduct and avoid any actual
                or
                apparent conflict of interest between one&#8217;s personal and professional
                relationships; </font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 63pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">B.&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">report
                to the Audit Committee of the Board any conflict of interest that
                may
                arise and any material transaction or relationship that reasonably
                could
                be expected to give rise to a conflict;
</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 63pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">C.&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">provide,
                or cause to be provided, full, fair, accurate, timely, and understandable
                disclosure in reports and documents that the Company files with or
                submits
                to the Securities and Exchange Commission and in other public
                communications; </font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 63pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">D.&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">comply
                and take all reasonable actions to cause others to comply with applicable
                governmental laws, rules, and regulations; and
</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;
      E.&#160; </font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">promptly
      report violations of this Code to the Audit Committee.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      CFO
      must also comply with the code of ethics and standards of conduct applicable
      to
      the Company's directors, officers, and employees generally as adopted from
      time
      to time and/or revised.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">IV.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Waiver</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Any
      request for a waiver of any provision of this Code must be in writing and
      addressed to the Audit Committee. Any waiver of this Code will be disclosed
      promptly on Form 8-K or any other means approved by the Securities and Exchange
      Commission. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">V.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Compliance
      and Accountability</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Audit
      Committee will assess compliance with this Code, report material violations
      to
      the Board of Directors, and recommend to the Board appropriate
      action.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
  </body>
</html>



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>3
<FILENAME>exh31.htm
<DESCRIPTION>EXHIBIT 31 - SOX 302 CERTIFICATION
<TEXT>
<html>
  <head>
    <title>
      Unassociated Document
</title>
<!-- Licensed to: Hallador Petroleum Company-->
<!-- Document Created using EDGARIZER HTML 3.0.3.0 -->
<!-- Copyright 2005 EDGARfilings, Ltd., an IEC company.-->
<!-- All rights reserved EDGARfilings.com -->
</head>
  <body bgcolor="#ffffff"><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>EXHIBIT
      31</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>CERTIFICATION</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">I,
      Victor
      P. Stabio, certify that:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">I
      have
      reviewed this report on Form 10-KSB of Hallador Petroleum Company;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 36pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Based
                on my knowledge, this report does not contain any untrue statement
                of a
                material fact or omit to state a material fact necessary to make
                the
                statements made, in light of the circumstances under which such statements
                were made, not misleading with respect to the period covered by this
                report;</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 36pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Based
                on my knowledge, the financial statements, and other financial information
                included in this report, fairly present in all material respects
                the
                financial condition, results of operations and cash flows of the
                registrant as of, and for, the periods presented in this
                report;</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 36pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">I
                am responsible for establishing and maintaining disclosure controls
                and
                procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
                for
                the registrant and I have:</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 36pt;">&#160;</td>
            <td style="width: 18pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a)
                </font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">designed
                such disclosure controls and procedures, or caused such disclosure
                controls and procedures to be designed under my supervision, to ensure
                that material information relating to the registrant, including its
                consolidated subsidiaries, is made known to me by others within those
                entities, particularly during the period in which this report is
                being
                prepared;</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 36pt;">&#160;</td>
            <td style="width: 18pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">b)</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">evaluated
                the effectiveness of the registrant's disclosure controls and procedures
                and presented in this report my conclusion about the effectiveness
                of the
                disclosure controls and procedures, as of the end of the period covered
                by
                this report based on such evaluation; and
</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 36pt;">&#160;</td>
            <td style="width: 18pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">c)
                </font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">disclosed
                in this report any change in the registrant&#8217;s internal control over
                financial reporting that occurred during the registrant&#8217;s most recent
                fiscal quarter that has materially affected, or is reasonably likely
                to
                materially affect, the registrant&#8217;s internal control over financial
                reporting; and </font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 36pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">I
                have disclosed, based on our most recent evaluation of internal control
                over financial reporting, to the registrant's auditors and the audit
                committee of registrant's board of directors;
</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 36pt;">&#160;</td>
            <td style="width: 18pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a)</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">all
                significant deficiencies and material weaknesses in the design or
                operation of internal control over financial reporting which are
                reasonably likely to adversely affect the registrant&#8217;s ability to record,
                process, summarize and report financial information; and
                </font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 36pt;">&#160;</td>
            <td style="width: 18pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">b)</font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">any
                fraud, whether or not material, that involves management or other
                employees who have a significant role in the registrant's internal
                control
                over financial reporting.</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date:</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">April
      14,
      2006</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">/S/
      VICTOR P STABIO</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CEO
      and
      CFO</font></div>
  </body>
</html>





</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>4
<FILENAME>exh32.htm
<DESCRIPTION>EXHIBIT 32 - SOX 906 CERTIFICATION
<TEXT>
<html>
  <head>
    <title>
      Unassociated Document
</title>
<!-- Licensed to: Hallador Petroleum Company-->
<!-- Document Created using EDGARIZER HTML 3.0.3.0 -->
<!-- Copyright 2005 EDGARfilings, Ltd., an IEC company.-->
<!-- All rights reserved EDGARfilings.com -->
</head>
  <body bgcolor="#ffffff"><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>EXHIBIT
      32</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>CERTIFICATION
      PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">In
      connection with the Annual Report of Hallador Petroleum Company (the "Company"),
      on Form 10-KSB for the period ended December 31, 2005, as filed with the
      Securities and Exchange Commission on the date hereof (the "Report"), the
      undersigned, in the capacities and dates indicated below, hereby certifies
      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002, that to his knowledge: (1) The Report fully complies
      with the requirements of Section 13(a) or 15(d) of the Securities Exchange
      Act
      of 1934; and (2) The information contained in the Report fairly presents, in
      all
      material respects, the financial condition and results of operations of the
      Company.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="left" valign="top" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Dated:
                April 14, 2006</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
            </td>
            <td align="left" valign="top" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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                VICTOR P. STABIO</font></div>
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                and CFO</font></div>
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<DOCUMENT>
<TYPE>EX-10.15
<SEQUENCE>5
<FILENAME>hardie.htm
<DESCRIPTION>HALLADOR ALTERNATIVE ASSETS FUND LLC SUBSCRIPTION AGREEMENT
<TEXT>
<html>
  <head>
    <title>
      Unassociated Document
</title>
<!-- Licensed to: Hallador Petroleum Company-->
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  <body bgcolor="#ffffff"><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>SUBSCRIPTION
      AGREEMENT</u></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
      Subscription Agreement (this &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Agreement&#8221;</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)
      is made
      as of February 14, 2006 by and between HALLADOR PETROLEUM COMPANY, a Colorado
      corporation (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Corporation</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      and
      Hallador Alternative Assets Fund LLC (&#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Subscriber</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Subscription</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      hereby subscribes for 227,272 shares (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Shares</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      of the
      Corporation&#8217;s common stock, par value $0.01 per share (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Common
      Stock</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      at a
      subscription price of $2.20 per share (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Per
      Share Subscription Price</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      for a
      total subscription price of $499,998.40 (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Total
      Subscription Price</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).
      </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      closing of the sale and purchase of the Shares (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Closing</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      will
      take place in the offices of Morgan, Lewis &amp; Bockius LLP, 300 S. Grand
      Avenue, Suite 2200, Los Angeles, California 90071 at 10:00 a.m. local time
      on
      February 14, 2006, or such later date and time as the Corporation and Subscriber
      agree (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Closing
      Date</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).
      At
      the Closing, (i) he Corporation will deliver to Subscriber a copy of this
      Agreement countersigned by the Corporation, and (ii) Subscriber will pay the
      Total Subscription Price to the Corporation by wire transfer of immediately
      available funds to an account designated by the Corporation to Subscriber in
      writing. Subject to the Closing, the Corporation shall cause its transfer agent
      to issue a certificate representing the Shares in the name of Subscriber and
      to
      deliver such certificate to Subscriber at the address set forth on the signature
      page hereto, within five (5) business days after the date on which the Closing
      occurs. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Acknowledgments</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby acknowledges that Subscriber, either alone or together with
      Subscriber&#8217;s advisors (if any), has read, understands and agrees with and to the
      following:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AN
      INVESTMENT IN THE SHARES INVOLVES A HIGH DEGREE OF RISK; THE CORPORATION MAY
      NEED ADDITIONAL CAPITAL IN THE FUTURE TO REACH ITS GROWTH OBJECTIVES OR MEET
      ITS
      EXPENSES AND THE SHARES MAY LOSE ANY VALUE OR MAY NOT GAIN ANY VALUE; THE SHARES
      ARE NOT REGISTERED AND MAY NOT BE SOLD EXCEPT IN COMPLIANCE WITH STATE AND
      FEDERAL SECURITIES LAWS AND REGULATIONS.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      acknowledges and agrees that the Corporation may at any time sell shares of
      its
      capital stock at a price greater or less than the Per Share Subscription Price
      pursuant to this Agreement. Subscriber acknowledges and agrees that the Shares
      may ultimately prove to be worth significantly more or significantly less than
      Subscriber perceives them to be worth now, and that no representation or
      warranty is made by the Corporation as to the &#8220;fair value&#8221; of the Shares or the
      interest in the Corporation that they represent, either now or in the
      future.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Shares have not been registered under the Securities Act of 1933, as amended
      (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Securities
      Act</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      or
      any state securities laws by reason of specific exemptions under the provisions
      thereof which depend in part upon the representations made by Subscriber in
      this
      Agreement. The Corporation is relying upon Subscriber&#8217;s representations
      contained in this Agreement for the purpose of determining whether this
      transaction meets the requirements for such exemptions.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Shares are &#8220;restricted securities&#8221; under applicable federal securities laws and
      the Securities Act and the rules of the Securities and Exchange Commission
      provide, in substance, that Subscriber may only dispose of the Shares pursuant
      to an effective registration statement under the Securities Act or an exemption
      from such registration if available. The Corporation has no obligation or
      intention to register any of the Shares under, or to take action so as to permit
      sales pursuant to, the Securities Act. Accordingly, Subscriber may dispose
      of
      the Shares only in certain transactions that are exempt from registration under
      the Securities Act, including &#8220;private placements,&#8221; in which event the
      transferee will acquire &#8220;restricted securities&#8221; subject to the same limitations
      as in the hands of Subscriber. Additionally, applicable state securities laws
      may allow sales of the Shares only if the Shares are registered or the
      transaction is subject to an applicable exemption. As a consequence, Subscriber
      must bear the economic risks of an investment in the Shares for an indefinite
      period of time.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(e)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      certificate(s) evidencing the Shares will bear the following legend, which
      shall
      be in addition to any other legends required by law or contract:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 72pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">THE
      SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD OR
      TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER
      THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(f)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Neither
      the Corporation nor any person acting on its behalf has offered or sold the
      Shares to Subscriber by any form of general solicitation, general or public
      media advertising or mass mailing.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Representations
      and Warranties</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby represents and warrants to the Corporation as
      follows:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      has all necessary power and authority under all applicable provisions of law
      to
      execute and deliver this Agreement and to carry out its provisions. All action
      on Subscriber&#8217;s part required for the lawful execution and delivery of this
      Agreement has been taken. Upon the execution and delivery of this Agreement,
      this Agreement will be a valid and binding obligation of Subscriber, enforceable
      in accordance with its terms, except as limited by (a) applicable bankruptcy,
      insolvency, reorganization, moratorium or other laws of general application
      affecting enforcement of creditors&#8217; rights, and (b) general principles of equity
      that restrict the availability of equitable remedies. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      has such knowledge, skill and experience in investment financial and business
      matters that Subscriber is capable of evaluating the merits and risks of the
      purchase of the Shares and of protecting Subscriber&#8217;s interests in connection
      therewith. Subscriber is able to fend for itself in connection with the
      transactions contemplated by this Agreement and has the ability to bear the
      economic risk of the investment, including complete loss of the investment.
      Subscriber understands that no federal or state agency has passed upon the
      Shares or made any finding or determination concerning the fairness or
      advisability of this investment. To the extent that Subscriber has deemed it
      appropriate to do so, Subscriber has retained, and relied upon, appropriate
      professional advice regarding the tax, legal and financial merits and
      consequences of an investment in the Shares.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber,
      either alone or together with Subscriber&#8217;s advisors (if any), has made such
      independent investigation of the Corporation, its management and related matters
      as Subscriber deems to be, or such advisors (if any) have advised to be,
      necessary or advisable in connection with an investment in the Shares.
      Subscriber and Subscriber&#8217;s advisors (if any) have received all information and
      data that Subscriber and such advisors (if any) believe to be necessary in
      order
      to reach an informed decision as to the advisability of an investment in the
      Shares.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber,
      either alone or together with Subscriber&#8217;s advisors (if any), has reviewed
      Subscriber&#8217;s financial condition and commitments and, based on such review,
      Subscriber is satisfied that (i) Subscriber has adequate means of providing
      for
      Subscriber&#8217;s financial needs and possible contingencies and has assets or
      sources of income which, taken together, are more than sufficient so that
      Subscriber could bear the risk of loss of Subscriber&#8217;s entire investment in the
      Shares, (ii) Subscriber has no present or contemplated future need to dispose
      of
      all or any portion of the Shares to satisfy any existing or contemplated
      undertaking, need or indebtedness, and (iii) Subscriber is capable of bearing
      the economic risk of an investment in the Shares for the indefinite
      future.</font></div>
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      Dale
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.16
<SEQUENCE>6
<FILENAME>tecovas.htm
<DESCRIPTION>TECOVAS PARTNERS V LP SUBSCRIPTION AGREEMENT
<TEXT>
<html>
  <head>
    <title>
      Unassociated Document
</title>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>SUBSCRIPTION
      AGREEMENT</u></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
      Subscription Agreement (this &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Agreement&#8221;</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)
      is made
      as of February 14, 2006 by and between HALLADOR PETROLEUM COMPANY, a Colorado
      corporation (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Corporation</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      and&#160;TECOVAS PARTNERS V, L.P., a Texas limited partnership&#160;
(&#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Subscriber</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Subscription</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      hereby subscribes for 90,909 shares (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Shares</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      of the
      Corporation&#8217;s common stock, par value $0.01 per share (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Common
      Stock</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      at a
      subscription price of $2.20 per share (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Per
      Share Subscription Price</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      for a
      total subscription price of $199,999.80 (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Total
      Subscription Price</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).
      </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      closing of the sale and purchase of the Shares (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Closing</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      will
      take place in the offices of Morgan, Lewis &amp; Bockius LLP, 300 S. Grand
      Avenue, Suite 2200, Los Angeles, California 90071 at 10:00 a.m. local time
      on
      February 14, 2006, or such later date and time as the Corporation and Subscriber
      agree (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Closing
      Date</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).
      At
      the Closing, (i) he Corporation will deliver to Subscriber a copy of this
      Agreement countersigned by the Corporation, and (ii) Subscriber will pay the
      Total Subscription Price to the Corporation by wire transfer of immediately
      available funds to an account designated by the Corporation to Subscriber in
      writing. Subject to the Closing, the Corporation shall cause its transfer agent
      to issue a certificate representing the Shares in the name of Subscriber and
      to
      deliver such certificate to Subscriber at the address set forth on the signature
      page hereto, within five (5) business days after the date on which the Closing
      occurs. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Acknowledgments</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby acknowledges that Subscriber, either alone or together with
      Subscriber&#8217;s advisors (if any), has read, understands and agrees with and to the
      following:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AN
      INVESTMENT IN THE SHARES INVOLVES A HIGH DEGREE OF RISK; THE CORPORATION MAY
      NEED ADDITIONAL CAPITAL IN THE FUTURE TO REACH ITS GROWTH OBJECTIVES OR MEET
      ITS
      EXPENSES AND THE SHARES MAY LOSE ANY VALUE OR MAY NOT GAIN ANY VALUE; THE SHARES
      ARE NOT REGISTERED AND MAY NOT BE SOLD EXCEPT IN COMPLIANCE WITH STATE AND
      FEDERAL SECURITIES LAWS AND REGULATIONS.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      acknowledges and agrees that the Corporation may at any time sell shares of
      its
      capital stock at a price greater or less than the Per Share Subscription Price
      pursuant to this Agreement. Subscriber acknowledges and agrees that the Shares
      may ultimately prove to be worth significantly more or significantly less than
      Subscriber perceives them to be worth now, and that no representation or
      warranty is made by the Corporation as to the &#8220;fair value&#8221; of the Shares or the
      interest in the Corporation that they represent, either now or in the
      future.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Shares have not been registered under the Securities Act of 1933, as amended
      (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Securities
      Act</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      or
      any state securities laws by reason of specific exemptions under the provisions
      thereof which depend in part upon the representations made by Subscriber in
      this
      Agreement. The Corporation is relying upon Subscriber&#8217;s representations
      contained in this Agreement for the purpose of determining whether this
      transaction meets the requirements for such exemptions.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Shares are &#8220;restricted securities&#8221; under applicable federal securities laws and
      the Securities Act and the rules of the Securities and Exchange Commission
      provide, in substance, that Subscriber may only dispose of the Shares pursuant
      to an effective registration statement under the Securities Act or an exemption
      from such registration if available. The Corporation has no obligation or
      intention to register any of the Shares under, or to take action so as to permit
      sales pursuant to, the Securities Act. Accordingly, Subscriber may dispose
      of
      the Shares only in certain transactions that are exempt from registration under
      the Securities Act, including &#8220;private placements,&#8221; in which event the
      transferee will acquire &#8220;restricted securities&#8221; subject to the same limitations
      as in the hands of Subscriber. Additionally, applicable state securities laws
      may allow sales of the Shares only if the Shares are registered or the
      transaction is subject to an applicable exemption. As a consequence, Subscriber
      must bear the economic risks of an investment in the Shares for an indefinite
      period of time.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(e)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      certificate(s) evidencing the Shares will bear the following legend, which
      shall
      be in addition to any other legends required by law or contract:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 72pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">THE
      SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD OR
      TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER
      THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(f)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Neither
      the Corporation nor any person acting on its behalf has offered or sold the
      Shares to Subscriber by any form of general solicitation, general or public
      media advertising or mass mailing.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Representations
      and Warranties</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby represents and warrants to the Corporation as
      follows:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      has all necessary power and authority under all applicable provisions of law
      to
      execute and deliver this Agreement and to carry out its provisions. All action
      on Subscriber&#8217;s part required for the lawful execution and delivery of this
      Agreement has been taken. Upon the execution and delivery of this Agreement,
      this Agreement will be a valid and binding obligation of Subscriber, enforceable
      in accordance with its terms, except as limited by (a) applicable bankruptcy,
      insolvency, reorganization, moratorium or other laws of general application
      affecting enforcement of creditors&#8217; rights, and (b) general principles of equity
      that restrict the availability of equitable remedies. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      has such knowledge, skill and experience in investment financial and business
      matters that Subscriber is capable of evaluating the merits and risks of the
      purchase of the Shares and of protecting Subscriber&#8217;s interests in connection
      therewith. Subscriber is able to fend for itself in connection with the
      transactions contemplated by this Agreement and has the ability to bear the
      economic risk of the investment, including complete loss of the investment.
      Subscriber understands that no federal or state agency has passed upon the
      Shares or made any finding or determination concerning the fairness or
      advisability of this investment. To the extent that Subscriber has deemed it
      appropriate to do so, Subscriber has retained, and relied upon, appropriate
      professional advice regarding the tax, legal and financial merits and
      consequences of an investment in the Shares.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber,
      either alone or together with Subscriber&#8217;s advisors (if any), has made such
      independent investigation of the Corporation, its management and related matters
      as Subscriber deems to be, or such advisors (if any) have advised to be,
      necessary or advisable in connection with an investment in the Shares.
      Subscriber and Subscriber&#8217;s advisors (if any) have received all information and
      data that Subscriber and such advisors (if any) believe to be necessary in
      order
      to reach an informed decision as to the advisability of an investment in the
      Shares.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber,
      either alone or together with Subscriber&#8217;s advisors (if any), has reviewed
      Subscriber&#8217;s financial condition and commitments and, based on such review,
      Subscriber is satisfied that (i) Subscriber has adequate means of providing
      for
      Subscriber&#8217;s financial needs and possible contingencies and has assets or
      sources of income which, taken together, are more than sufficient so that
      Subscriber could bear the risk of loss of Subscriber&#8217;s entire investment in the
      Shares, (ii) Subscriber has no present or contemplated future need to dispose
      of
      all or any portion of the Shares to satisfy any existing or contemplated
      undertaking, need or indebtedness, and (iii) Subscriber is capable of bearing
      the economic risk of an investment in the Shares for the indefinite
      future.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(e)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      is acquiring the Shares for Subscriber&#8217;s own account, for investment only and
      not with a view to or in connection with any resale or distribution of the
      Shares, and Subscriber has no present intention of making any sale, assignment,
      pledge, gift, transfer or other disposition of the Shares or any interest
      therein. Subscriber understands that the Shares have not been registered under
      the Securities Act or any state securities laws by reason of specific exemptions
      which depend upon, among other things, the bona fide nature of the investment
      intent and the accuracy of Subscriber&#8217;s representations as expressed
      herein.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(f)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      understands that any public market for any of the securities issued by the
      Corporation is limited and that there is no assurance that an active public
      market will ever exist for such securities. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(g)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      is an &#8220;Accredited Investor&#8221; within the meaning of Rule 501 promulgated under the
      Securities Act, and has completed or will complete and deliver an Accredited
      Investor Questionnaire to the Corporation on or before the Closing
      Date.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(h)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      is a limited partnership and the office or offices of Subscriber in which its
      investment decision was made is located at the address or addresses of
      Subscriber set forth on the signature page hereof.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Covenant</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby agrees to furnish any additional information requested by
      the
      Corporation to assure compliance of this transaction with applicable federal
      and
      state securities laws, and to make any filings with the Securities and Exchange
      Commission as may be required of Subscriber pursuant to the Securities Exchange
      Act of 1934, as amended, and the rules promulgated thereunder. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>General
      Provisions</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Governing
      Law; Jurisdiction</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      This
      Agreement shall be governed, construed and interpreted in accordance with the
      laws of the State of Colorado, without giving effect to principles of conflicts
      of law and choice of law that would cause the laws of any other jurisdiction
      to
      apply. </font></div>
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</font></div>
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<DOCUMENT>
<TYPE>EX-10.17
<SEQUENCE>7
<FILENAME>lubar.htm
<DESCRIPTION>LUBAR EQUITY FUND LLC SUBSCRIPTION AGREEMENT
<TEXT>
<html>
  <head>
    <title>
      Unassociated Document
</title>
<!-- Licensed to: Hallador Petroleum Company-->
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<!-- Copyright 2005 EDGARfilings, Ltd., an IEC company.-->
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  <body bgcolor="#ffffff"><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>SUBSCRIPTION
      AGREEMENT</u></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
      Subscription Agreement (this &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Agreement&#8221;</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)
      is made
      as of February 14, 2006 by and between HALLADOR PETROLEUM COMPANY, a Colorado
      corporation (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Corporation</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      and&#160;&#160;&#160; Lubar Equity Fund&#160;LLC&#160;(&#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Subscriber</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Subscription</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      hereby subscribes for 90,909 shares (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Shares</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      of the
      Corporation&#8217;s common stock, par value $0.01 per share (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Common
      Stock</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      at a
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      Share Subscription Price</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      for a
      total subscription price of $199,999.80 (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Total
      Subscription Price</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      closing of the sale and purchase of the Shares (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Closing</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      will
      take place in the offices of Morgan, Lewis &amp; Bockius LLP, 300 S. Grand
      Avenue, Suite 2200, Los Angeles, California 90071 at 10:00 a.m. local time
      on
      February 14, 2006, or such later date and time as the Corporation and Subscriber
      agree (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Closing
      Date</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).
      At
      the Closing, (i) he Corporation will deliver to Subscriber a copy of this
      Agreement countersigned by the Corporation, and (ii) Subscriber will pay the
      Total Subscription Price to the Corporation by wire transfer of immediately
      available funds to an account designated by the Corporation to Subscriber in
      writing. Subject to the Closing, the Corporation shall cause its transfer agent
      to issue a certificate representing the Shares in the name of Subscriber and
      to
      deliver such certificate to Subscriber at the address set forth on the signature
      page hereto, within five (5) business days after the date on which the Closing
      occurs. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Acknowledgments</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby acknowledges that Subscriber, either alone or together with
      Subscriber&#8217;s advisors (if any), has read, understands and agrees with and to the
      following:</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AN
      INVESTMENT IN THE SHARES INVOLVES A HIGH DEGREE OF RISK; THE CORPORATION MAY
      NEED ADDITIONAL CAPITAL IN THE FUTURE TO REACH ITS GROWTH OBJECTIVES OR MEET
      ITS
      EXPENSES AND THE SHARES MAY LOSE ANY VALUE OR MAY NOT GAIN ANY VALUE; THE SHARES
      ARE NOT REGISTERED AND MAY NOT BE SOLD EXCEPT IN COMPLIANCE WITH STATE AND
      FEDERAL SECURITIES LAWS AND REGULATIONS.</font></div>
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      acknowledges and agrees that the Corporation may at any time sell shares of
      its
      capital stock at a price greater or less than the Per Share Subscription Price
      pursuant to this Agreement. Subscriber acknowledges and agrees that the Shares
      may ultimately prove to be worth significantly more or significantly less than
      Subscriber perceives them to be worth now, and that no representation or
      warranty is made by the Corporation as to the &#8220;fair value&#8221; of the Shares or the
      interest in the Corporation that they represent, either now or in the
      future.</font></div>
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      Shares have not been registered under the Securities Act of 1933, as amended
      (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Securities
      Act</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      or
      any state securities laws by reason of specific exemptions under the provisions
      thereof which depend in part upon the representations made by Subscriber in
      this
      Agreement. The Corporation is relying upon Subscriber&#8217;s representations
      contained in this Agreement for the purpose of determining whether this
      transaction meets the requirements for such exemptions.</font></div>
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      Shares are &#8220;restricted securities&#8221; under applicable federal securities laws and
      the Securities Act and the rules of the Securities and Exchange Commission
      provide, in substance, that Subscriber may only dispose of the Shares pursuant
      to an effective registration statement under the Securities Act or an exemption
      from such registration if available. The Corporation has no obligation or
      intention to register any of the Shares under, or to take action so as to permit
      sales pursuant to, the Securities Act. Accordingly, Subscriber may dispose
      of
      the Shares only in certain transactions that are exempt from registration under
      the Securities Act, including &#8220;private placements,&#8221; in which event the
      transferee will acquire &#8220;restricted securities&#8221; subject to the same limitations
      as in the hands of Subscriber. Additionally, applicable state securities laws
      may allow sales of the Shares only if the Shares are registered or the
      transaction is subject to an applicable exemption. As a consequence, Subscriber
      must bear the economic risks of an investment in the Shares for an indefinite
      period of time.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(e)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      certificate(s) evidencing the Shares will bear the following legend, which
      shall
      be in addition to any other legends required by law or contract:</font></div>
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      SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD OR
      TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER
      THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(f)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Neither
      the Corporation nor any person acting on its behalf has offered or sold the
      Shares to Subscriber by any form of general solicitation, general or public
      media advertising or mass mailing.</font></div>
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      and Warranties</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby represents and warrants to the Corporation as
      follows:</font></div>
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      has all necessary power and authority under all applicable provisions of law
      to
      execute and deliver this Agreement and to carry out its provisions. All action
      on Subscriber&#8217;s part required for the lawful execution and delivery of this
      Agreement has been taken. Upon the execution and delivery of this Agreement,
      this Agreement will be a valid and binding obligation of Subscriber, enforceable
      in accordance with its terms, except as limited by (a) applicable bankruptcy,
      insolvency, reorganization, moratorium or other laws of general application
      affecting enforcement of creditors&#8217; rights, and (b) general principles of equity
      that restrict the availability of equitable remedies. </font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      has such knowledge, skill and experience in investment financial and business
      matters that Subscriber is capable of evaluating the merits and risks of the
      purchase of the Shares and of protecting Subscriber&#8217;s interests in connection
      therewith. Subscriber is able to fend for itself in connection with the
      transactions contemplated by this Agreement and has the ability to bear the
      economic risk of the investment, including complete loss of the investment.
      Subscriber understands that no federal or state agency has passed upon the
      Shares or made any finding or determination concerning the fairness or
      advisability of this investment. To the extent that Subscriber has deemed it
      appropriate to do so, Subscriber has retained, and relied upon, appropriate
      professional advice regarding the tax, legal and financial merits and
      consequences of an investment in the Shares.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber,
      either alone or together with Subscriber&#8217;s advisors (if any), has made such
      independent investigation of the Corporation, its management and related matters
      as Subscriber deems to be, or such advisors (if any) have advised to be,
      necessary or advisable in connection with an investment in the Shares.
      Subscriber and Subscriber&#8217;s advisors (if any) have received all information and
      data that Subscriber and such advisors (if any) believe to be necessary in
      order
      to reach an informed decision as to the advisability of an investment in the
      Shares.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber,
      either alone or together with Subscriber&#8217;s advisors (if any), has reviewed
      Subscriber&#8217;s financial condition and commitments and, based on such review,
      Subscriber is satisfied that (i) Subscriber has adequate means of providing
      for
      Subscriber&#8217;s financial needs and possible contingencies and has assets or
      sources of income which, taken together, are more than sufficient so that
      Subscriber could bear the risk of loss of Subscriber&#8217;s entire investment in the
      Shares, (ii) Subscriber has no present or contemplated future need to dispose
      of
      all or any portion of the Shares to satisfy any existing or contemplated
      undertaking, need or indebtedness, and (iii) Subscriber is capable of bearing
      the economic risk of an investment in the Shares for the indefinite
      future.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(e)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      is acquiring the Shares for Subscriber&#8217;s own account, for investment only and
      not with a view to or in connection with any resale or distribution of the
      Shares, and Subscriber has no present intention of making any sale, assignment,
      pledge, gift, transfer or other disposition of the Shares or any interest
      therein. Subscriber understands that the Shares have not been registered under
      the Securities Act or any state securities laws by reason of specific exemptions
      which depend upon, among other things, the bona fide nature of the investment
      intent and the accuracy of Subscriber&#8217;s representations as expressed
      herein.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(f)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      understands that any public market for any of the securities issued by the
      Corporation is limited and that there is no assurance that an active public
      market will ever exist for such securities. </font></div>
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      is an &#8220;Accredited Investor&#8221; within the meaning of Rule 501 promulgated under the
      Securities Act, and has completed or will complete and deliver an Accredited
      Investor Questionnaire to the Corporation on or before the Closing
      Date.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(h)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      is a limited partnership and the office or offices of Subscriber in which its
      investment decision was made is located at the address or addresses of
      Subscriber set forth on the signature page hereof.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Covenant</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby agrees to furnish any additional information requested by
      the
      Corporation to assure compliance of this transaction with applicable federal
      and
      state securities laws, and to make any filings with the Securities and Exchange
      Commission as may be required of Subscriber pursuant to the Securities Exchange
      Act of 1934, as amended, and the rules promulgated thereunder. </font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Governing
      Law; Jurisdiction</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      This
      Agreement shall be governed, construed and interpreted in accordance with the
      laws of the State of Colorado, without giving effect to principles of conflicts
      of law and choice of law that would cause the laws of any other jurisdiction
      to
      apply. </font></div>
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      and Assigns</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      This
      Agreement may not be assigned, conveyed or transferred without the prior written
      consent of the Corporation. Subject to the foregoing, the rights and obligations
      of the Corporation and Subscriber under this Agreement shall be binding upon
      and
      benefit their respective permitted successors, assigns, heirs, administrators
      and transferees. The terms and provisions of this Agreement are for the sole
      benefit of the parties hereto and their respective permitted successors and
      assigns, and are not intended to confer any third-party benefit on any other
      person.</font></div>
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      Agreement</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      This
      Agreement constitutes the full and entire understanding and agreement between
      the parties with regard to the subjects hereof and no party shall be liable
      or
      bound to any other in any manner by any representations, warranties, covenants
      and agreements except as specifically set forth herein.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Severability</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      In case
      any provision of the Agreement shall be invalid, illegal or unenforceable,
      the
      validity, legality and enforceability of the remaining provisions shall not
      in
      any way be affected or impaired thereby.</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(e)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Amendment
      or Waiver</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      This
      Agreement may not be amended, and no term or provision of this Agreement may
      be
      waived, except upon the written consent of the Corporation and
      Subscriber.</font></div>
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      Each
      party shall pay all costs and expenses that it incurs with respect to the
      negotiation, execution, delivery and performance of the Agreement.</font></div>
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      and Subtitles</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      The
      titles of the sections and subsections of the Agreement are for convenience
      of
      reference only and shall not be considered in construing this
      Agreement.</font></div>
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      This
      Agreement may be executed in any number of counterparts and by facsimile, each
      of which shall be an original, but all of which together shall constitute one
      instrument. If executed by facsimile, the parties shall subsequently exchange
      original signed copies by mail or courier service.</font></div>
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      WITNESS WHEREOF, the undersigned has caused this Subscription Agreement to
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        </font></div>
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        <div>
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<DOCUMENT>
<TYPE>EX-10.18
<SEQUENCE>8
<FILENAME>murchison.htm
<DESCRIPTION>MURCHISON CAPITAL PARTNERS LP SUBSCRIPTION AGREEMENT
<TEXT>
<html>
  <head>
    <title>
      Unassociated Document
</title>
<!-- Licensed to: Hallador Petroleum Company-->
<!-- Document Created using EDGARIZER HTML 3.0.3.0 -->
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  <body bgcolor="#ffffff"><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>SUBSCRIPTION
      AGREEMENT</u></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
      Subscription Agreement (this &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Agreement&#8221;</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)
      is made
      as of February 14, 2006 by and between HALLADOR PETROLEUM COMPANY, a Colorado
      corporation (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Corporation</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      and&#160;&#160;MURCHISON CAPITAL PARTNERS, L.P.&#160;&#160; (&#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Subscriber</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Subscription</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      hereby subscribes for 49,454 (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Shares</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      of the
      Corporation&#8217;s common stock, par value $0.01 per share (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Common
      Stock</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      at a
      subscription price of $2.20 per share (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Per
      Share Subscription Price</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      for a
      total subscription price of $99,998.80 (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Total
      Subscription Price</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).
      </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      closing of the sale and purchase of the Shares (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Closing</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;)
      will
      take place in the offices of Morgan, Lewis &amp; Bockius LLP, 300 S. Grand
      Avenue, Suite 2200, Los Angeles, California 90071 at 10:00 a.m. local time
      on
      February 14, 2006, or such later date and time as the Corporation and Subscriber
      agree (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Closing
      Date</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;).
      At
      the Closing, (i) he Corporation will deliver to Subscriber a copy of this
      Agreement countersigned by the Corporation, and (ii) Subscriber will pay the
      Total Subscription Price to the Corporation by wire transfer of immediately
      available funds to an account designated by the Corporation to Subscriber in
      writing. Subject to the Closing, the Corporation shall cause its transfer agent
      to issue a certificate representing the Shares in the name of Subscriber and
      to
      deliver such certificate to Subscriber at the address set forth on the signature
      page hereto, within five (5) business days after the date on which the Closing
      occurs. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Acknowledgments</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby acknowledges that Subscriber, either alone or together with
      Subscriber&#8217;s advisors (if any), has read, understands and agrees with and to the
      following:</font></div>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AN
      INVESTMENT IN THE SHARES INVOLVES A HIGH DEGREE OF RISK; THE CORPORATION MAY
      NEED ADDITIONAL CAPITAL IN THE FUTURE TO REACH ITS GROWTH OBJECTIVES OR MEET
      ITS
      EXPENSES AND THE SHARES MAY LOSE ANY VALUE OR MAY NOT GAIN ANY VALUE; THE SHARES
      ARE NOT REGISTERED AND MAY NOT BE SOLD EXCEPT IN COMPLIANCE WITH STATE AND
      FEDERAL SECURITIES LAWS AND REGULATIONS.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      acknowledges and agrees that the Corporation may at any time sell shares of
      its
      capital stock at a price greater or less than the Per Share Subscription Price
      pursuant to this Agreement. Subscriber acknowledges and agrees that the Shares
      may ultimately prove to be worth significantly more or significantly less than
      Subscriber perceives them to be worth now, and that no representation or
      warranty is made by the Corporation as to the &#8220;fair value&#8221; of the Shares or the
      interest in the Corporation that they represent, either now or in the
      future.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Shares have not been registered under the Securities Act of 1933, as amended
      (the &#8220;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Securities
      Act</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8221;),
      or
      any state securities laws by reason of specific exemptions under the provisions
      thereof which depend in part upon the representations made by Subscriber in
      this
      Agreement. The Corporation is relying upon Subscriber&#8217;s representations
      contained in this Agreement for the purpose of determining whether this
      transaction meets the requirements for such exemptions.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Shares are &#8220;restricted securities&#8221; under applicable federal securities laws and
      the Securities Act and the rules of the Securities and Exchange Commission
      provide, in substance, that Subscriber may only dispose of the Shares pursuant
      to an effective registration statement under the Securities Act or an exemption
      from such registration if available. The Corporation has no obligation or
      intention to register any of the Shares under, or to take action so as to permit
      sales pursuant to, the Securities Act. Accordingly, Subscriber may dispose
      of
      the Shares only in certain transactions that are exempt from registration under
      the Securities Act, including &#8220;private placements,&#8221; in which event the
      transferee will acquire &#8220;restricted securities&#8221; subject to the same limitations
      as in the hands of Subscriber. Additionally, applicable state securities laws
      may allow sales of the Shares only if the Shares are registered or the
      transaction is subject to an applicable exemption. As a consequence, Subscriber
      must bear the economic risks of an investment in the Shares for an indefinite
      period of time.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(e)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      certificate(s) evidencing the Shares will bear the following legend, which
      shall
      be in addition to any other legends required by law or contract:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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      SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD OR
      TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER
      THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(f)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Neither
      the Corporation nor any person acting on its behalf has offered or sold the
      Shares to Subscriber by any form of general solicitation, general or public
      media advertising or mass mailing.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Representations
      and Warranties</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Subscriber hereby represents and warrants to the Corporation as
      follows:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subscriber
      has all necessary power and authority under all applicable provisions of law
      to
      execute and deliver this Agreement and to carry out its provisions. All action
      on Subscriber&#8217;s part required for the lawful execution and delivery of this
      Agreement has been taken. Upon the execution and delivery of this Agreement,
      this Agreement will be a valid and binding obligation of Subscriber, enforceable
      in accordance with its terms, except as limited by (a) applicable bankruptcy,
      insolvency, reorganization, moratorium or other laws of general application
      affecting enforcement of creditors&#8217; rights, and (b) general principles of equity
      that restrict the availability of equitable remedies. </font></div>
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      has such knowledge, skill and experience in investment financial and business
      matters that Subscriber is capable of evaluating the merits and risks of the
      purchase of the Shares and of protecting Subscriber&#8217;s interests in connection
      therewith. Subscriber is able to fend for itself in connection with the
      transactions contemplated by this Agreement and has the ability to bear the
      economic risk of the investment, including complete loss of the investment.
      Subscriber understands that no federal or state agency has passed upon the
      Shares or made any finding or determination concerning the fairness or
      advisability of this investment. To the extent that Subscriber has deemed it
      appropriate to do so, Subscriber has retained, and relied upon, appropriate
      professional advice regarding the tax, legal and financial merits and
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      Subscriber and Subscriber&#8217;s advisors (if any) have received all information and
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      and
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      consent of the Corporation. Subject to the foregoing, the rights and obligations
      of the Corporation and Subscriber under this Agreement shall be binding upon
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      and transferees. The terms and provisions of this Agreement are for the sole
      benefit of the parties hereto and their respective permitted successors and
      assigns, and are not intended to confer any third-party benefit on any other
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      the parties with regard to the subjects hereof and no party shall be liable
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      of which shall be an original, but all of which together shall constitute one
      instrument. If executed by facsimile, the parties shall subsequently exchange
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      WITNESS WHEREOF, the undersigned has caused this Subscription Agreement to
      be
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 216pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SUBSCRIBER</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">:
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            <tr valign="top" style="line-height: 1.25;">
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              <td style="width: 36pt;">
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                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Murchison
                  Management Corp., its general partner
</font></div>
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        LBJ
        Freeway, Suite 1450 </font></div>
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        Teri Rife </font></div>
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                  </font></div>
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        <div>
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              <tr valign="top" style="line-height: 1.25;">
                <td style="width: 216pt;">&#160;</td>
                <td style="width: 36pt;">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
                </td>
                <td>
                </td>
              </tr>

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        <div style="DISPLAY: block; MARGIN-LEFT: 252pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By:/S/VICTOR
          P. STABIO</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 252pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Name:
          VICTOR P. STABIO</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 252pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Title:&#160;
          PRESIDENT</font></div>
      </div>
    </div>
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