up 47% today, news soon, page-13

And this is all the other reasons for the recent action in KOG:)


Upmach Prospect
The D.M. Rush #1 well will be completed in the main pay objective commencing later this week.
It is anticipated that this well will be generating revenue in mid March. It is estimated that an
additional three to five wells will be drilled on this new discovery over the course of the next 24
months.
Reserves
Kilgore recently announced that its gross reserves are now in the order of 4.5 Bcfe and expects
to increase these reserves further once the Stary and UpMach fields commence production.
There is also potential for further reserve upgrades in the event that commercial quantities of
hydrocarbons are discovered in the Boettcher, Skimmer, Sandpiper, Snipe or Egret prospects
that will be drilled in the first half of calendar 2009.
Production and Cashflow
Kilgore’s first discovery, Alford#1, is currently producing at 125 MCFD (net 70 MCFD). The
operator is currently loading up the well by dropping soap sticks with the aim of raising
production to 250MCFD.
Anticipated revenues in the first full month of production from the existing Alford and the soon to
be producing Stary and Upmach wells (April 2009) should be between US$150,000 and
US$200,000 per month, based upon current NYMEX quoted prices for oil and gas.
Asset Values and Net Asset Backing
Kilgore currently has 110,800,003 shares on issue with a further 7,000,000 shares to be issued
on conversion of the Class D Performance Shares when reserves exceed 8 BCFE. It has no
issued options, convertible notes or debt.
Analysis of the value of recent publicly available transactions in the Gulf Coast indicates an
average gas reserve multiple of US$2.74/MCF and an average gas production multiple of
US$11,000/MCFD.
On the above basis, Kilgore’s current reserves would be worth between US$11m and 12.3m
(A$16.2-18.1m based upon an exchange rate to the US$ of 0.68), equivalent to approximately
A$0.155 per share. Should the final (Class D) performance share threshold (8 BCFE) be
achieved, the net asset backing per share would be equivalent (based upon 8 BCFE of
reserves) to approximately A$0.27, based upon the same gas reserve multiple price and exchange rate.

Happy to be holding KOG thats for sure the time in the sun is just dawning for KOG 20 cents here we come IMO :)$$$$

GB:)