Ann: Sugarloaf Operational Update , page-47

Well put

Perhaps hilcorp are suggesting cash flow is / will be sufficient to fully self fund and develop additional acerage. Certainly on my calcs AUT will have no problems with cash flow if the free carried wells are at 14/8ths of Kennedy. They and I are hoping for better. But even based on 14/8ths of Kennedy flow rates the figures are staggering for such a small company.

Looking at it from hilcorps perspective, they are probably running similar numbers and thinking, "if this shale is so good, we need far more then the AMI has to offer".

The numbers if they can successfully frac and get good flow equivelent to or better then Kennedy but for 14 stages from Weston, Easily , Morgan , Grand Ranch, Ipenema and Longhorn, plus salvage something out of Kowalick are literally mind blowing.

To then consider that 2 years down the track they could be trying to achieve even 100 acre spacing on 1/10th of the acerage is incomprehensible in terms of the numbers.

If ADI projections of 235+ wells come to fruition at a rate of 10 in 2010, 20 in 2011, 40 in 2012 etc the numbers are insane. Even at half that rate investors will be scrambling for more. When you then think Ipenenma and Longhorn on top of that, well thats beyond considering.