Ann: Proactive Investors Series Presentation, page-7

Hi gusman

At this stage everything is on track at Grieve and there was nothing in our conversation that would suggest anything that may be a problem. Having said that I might have not asked the right question.

My only concern was that the current injection rate did not appear to be sufficient to get to 52 BCF CO2 by December/ January as they need another 16BCF and are injecting around 1BCF per month. This would leave them 4BCF or 4 months short. Brad said the reservoir pressure increase is tracking the predicted plot and even slightly ahead. The turnkey contract stipulates than certain criteria/ milestones need to be achieved before funds are released to Denbury, one of which is the gas/ water injection needs to increase the pressure to certain levels at certain points in time. The current gas injection rate is about 30 mmcfgpd CO2 with 4000 BWPD. The gas injection rate can be lifted to 50-60 MMCFGPD CO2 if needed. Having said that, IMO a couple of months slippage to restart Grieve production would not be a disaster as long as this did not impact on the cost to ELK.

Madden is throwing of free cash as we speak and ELK is now a significant producer of gas at around 20 MMCFGPD net, plus 6MMCFGPD CO2 plus sulphur. Sulphur prices are depressed at this stage but Brad said that previously the plant was earning up to $50 million a year in sulphur sales.

Construction of the remaining facilities will commence around April as the winter weather recedes and should be completed on time around Sept 2017.

The Grieve oil pipeline transport contract which all oil from the field has to be sent through is set at $3 per barrel, just below the $3.25 cost it would be to truck the oil to Casper. ELK receives all the proceeds from the pipeline and there is spare capacity for 3rd party oil to be sent though the pipe thereby adding a further potential income source.

The plan for growth picking up other EOR projects is facilitated by the purchase of Madden because ELK now own a source of CO2. There is the potential to join Denbury in other projects in the area.

Cheers

Dan