Ann: Quarterly Activities and Cashflow Report , page-4

I don't often say this because very smart people can look at the same data set and come to different conclusions but ..... em ...... SELLERS ARE CRAZY !!!

Seriously:

1) They have proved their economics. IRR better than most peers across 20 wells. Income now more than developmental costs. If they don't ramp up production, the model has becomes organically funded after 2 yrs (ie from when they bought the land). Compare with most junior oilers

2) In addition to recent equity injection, RBL facility will be obtained and likely imminent. RFE did their reserve report in Dec 31 2012 and had their RBL 4 months later. AOK Reserve report was 1st Aug.

3) RBL will likely be significant relative to company size. RBL is (to my understanding) based mainly on NPV of 1P reserves, discounted to provide a margin of error for the banks.

RFE: NPV $144M, Facility $100M, Borrowing Base $45M
AOK: NPV $257M, Facility $ ???, Borrowing Base $ ???

4) Think about this (especially people who own both stocks). On a shoe string budget, AOK has proved up almost twice as much value as RFE.

5) Current valuation = $5/bbl of 1P reserves!! And the reserves have some of the best economics of any play in the USA.