REDCASTLE RESOURCES LIMITED — Audit Report / Information 2011

Jul 21, 2011

GRP Corporation Limited

Level 2, Spectrum 100 Railway Road Subiaco WA 6008 PH: 08 9367 8133 FX: 08 9367 8812 EM: info@grpcorporation.com www.grpcorporation.com

22 July 2011

Replacement Technical Report and Valuation Report

On 5 May 2011, GRP Corporation Limited (ASX: GRP) (to be renamed Cady Energy Limited) (Company) despatched a notice of annual general meeting (Notice) to its shareholders in respect of an annual general meeting to be held on 7 June 2011 (Original Meeting).

An Independent Expert's Report prepared by HLB Mann Judd Corporate (WA) Pty Ltd dated 5 May 2011 (Original IER), a Valuation Report prepared by Robert. A. King dated 10 April 2011 (Valuation Report) and a Technical Report prepared by Robert. A. King dated 17 June 2010 (Technical Report) were also despatched to shareholders on this date.

The Original Meeting was subsequently adjourned and the annual general meeting held on 6 July 2011 (AGM).

As announced on 27 June 2011, the Company despatched supplementary material together with an addendum to the Original IER prepared by HLB Mann Judd Corporate (WA) Pty Ltd (IER Addendum) and a revised Valuation Report prepared by Robert. A. King (Revised Valuation Report) in relation to resolutions to be considered at the AGM (together, the Supplementary Material).

Since the date of despatch of the Supplementary Material, it has come to the Company's attention that the Technical Report and Revised Valuation Report do not comply with the reporting requirements imposed by the Australian Securities and Investments Commission (ASIC) and the Australian Institute of Mining and Metallurgy's Code for Technical Assessment and Valuation of Mineral and Petroleum Assets and Securities for Independent Expert Reports (VALMIN Code).

Accordingly, to ensure the Company complies with its continuous disclosure obligations, attached to this announcement is a revised Technical Report (Replacement Technical Report) and a further revised Valuation Report (Replacement Valuation Report).

Outlined below is a summary of the amendments made to those reports.

Replacement Technical Report

In accordance with the reporting requirements of the VALMIN Code, the Replacement Technical Report has been amended:

• (a) to make it clear that Robert. A. King has used the Petroleum Resources Management System (PRMS) published by the Society of Petroleum Engineers (SPE), American Association of Petroleum Geologists (American Association of Petroleum Geologists (AAPG), World Petroleum Council (WPC) and the Society of Petroleum Evaluation Engineers (SPEE) to provide an estimation of gas volumes within the Hanging Woman Project;
• (b) to clarify that the estimates in the Replacement Technical Report are consistent with the PRMS;
• (c) to clarify and correct references to gas reserve and resource volumes; and
• (d) to clarify and correct references to Contingent Resources (instead of "Reserves").

Replacement Valuation Report

As required by ASIC Regulatory Guide 111, the Replacement Valuation Report now contains a basis for the conclusions reached in that report and as such:

• (a) includes more than one valuation methodology and compares the values derived from using these different methodologies to minimise the risk that the opinion reached in the Replacement Valuation Report is unreliable;
• (b) justifies the choice of methodologies and describes the methods used;
• (c) takes into account the capital expenditure requirements of the Hanging Woman Project in the material assumptions;
• (d) includes a sensitivity analysis illustrating the impact of changes in material assumptions that are likely to materially impact on the valuation; and
• (e) includes a determination of the status of the lease which comprise the Hanging Woman Project.

Shareholders may contact the Company on (+61 2) 9299 2289 if they have any queries in respect of the matters set out in this announcement or the annexed revised reports.

Mark Rowbottam Non-Executive Director

ROBERT A. KING, P.E.

1551 THREE CROWNS DRIVE, SUITE 301 CASPER , WYOMING 82604 (307) 266-5464 bobking06@qwestofficenet

July 21, 2011

Lucio DiGiallonardo HLB Mann Judd Corporate (WA) Pty Ltd Level 4, 130 Stirling Street Perth WA 6000

Re: Independent Valuation Report GRP Corporation Limited

Dear Mr. DiGiallonardo:

I have been requested by HLB Mann Judd Corporate (WA) Pry Ltd ("HLB") to prepare an independent valuation of certain assets to be acquired by GRP Corporation Limited ("GRP") from Cady Energy Pty Ltd ("CADY"), which holds an exclusive right to purchase 100% of the Hanging Woman Coalbed Methane Project in Campbell County, Wyoming, USA. It is my understanding this valuation is to be included in an Independent Expert's Report by HLB to the shareholders of GRP.

Based on my knowledge and valuation of similar coalbed methane properties in the Powder River Basin of Wyoming, I value the probable (P2) reserves associated with the Hanging Woman Project as follows:

Low Case Value	US\$37,521,000
Preferred Case Value	US\$47,526,000
High Case Value	US\$60,033,000

In making my determination of the value of the Hanging Woman Project, I have taken into account the status of the various leases; including area, net acreage holding, expiry dates and royalties. These are detailed in the Tenure report of Brown, Drew and Massey dated July 19, 2011.

Background

CADY entered into an agreement to purchase 100% of the Hanging Woman Project, which consists of development rights on 13,280 net acres and 30 completed coalbed methane wells, from Kennedy Oil. hi May 2011,1 prepared a reserves report for CADY that quantified the potential coalbed methane gas resources within the Hanging Woman Project. From this work, I concluded using a volumetric analysis there were 50,031 mmcf (million cubic feet) of probable gross gas reserves based on 1) geologic mapping of the various coals present, 2) coal gas content data published by the United States Geologic Survey, and 3) proximity to established coalbed methane production within the surrounding area. Attached is a copy of this report. Nothing has come to my attention to suggest that the reserves as represented in my June 2011

Valuation Report Page 2

report are materially different as of the date of this letter. In March 2011 GRP announced it had entered into an agreement with CADY to acquire 100% of CADY

Methodology

It is my opinion the methodology used to prepare this valuation report is in accordance with industry standards as set out in the Australian Institute of Mining and Metallurgy's Code for the Technical Assessment and Valuation of Mineral and Petroleum Assets and Securities for Independent Expert Reports (the VALMIN Code, 2005 Edition).

The valuation of reserves in the ground, both proven and unproven, is highly speculative, and subject in part to the time frame of development, the valuator's expectation of future gas prices, marketing options, projected development and operating costs, accuracy of the geologic model, and other unforeseen risks and uncertainties.

This determination of value for probable (unproven) reserves is based on assumptions that 1) the project will be implemented in a timely manner consistent with proven drilling and infrastructure development methods, 2) gas price will remain relatively constant for the foreseeable future at NYMEX of about US\$4.40/mmbtu, 3) marketing, transportation, gas quality, and processing deductions will range between US\$1.00/mcf and US\$1.25/mcf, 4) normal operating costs for the wells and equipment will be around US\$1,000 per well-month, 5) production taxes will remain at the current observed level of approximately 13% of gross revenue, 6) GRP will retain a 100% working interest in the project, 7) the leases associated with the project will not be unduly burdened with over-riding royalty interests, 8) the average cost to drill, complete, and equip a typical coalbed methane well in the project area is projected at about US\$250,000, and 9) the reserves calculated in my May 2011 report will be actually recovered and developed within GRP's acceptable risk tolerance and economic expectations.

The valuation above is based on the probable (P2) reserves associated with the Hanging Woman Project, and does not include any asset adjustment for any further payment obligations by Cady to Kennedy Oil under the Sales and Purchase Agreement entered into between the parties in June 2010.1 understand that these contracted further payment obligations include a cash installment payment within 30 days of listing on the ASX of US\$1,550,000 for the acquisition of the Hanging Woman Project and reimbursement for operating costs incurred by Kennedy Oil on the Hanging Woman Project in the period from January 26, 2010 until listing, where I understand these operating costs are expected to be of the order of US\$500,000 to US\$550,000 to end July 2011.

The valuation methodology is based on \$/mcf of 2P reserves using my knowledge of coal bed methane transactions in Wyoming. In some cases the specifics of this knowledge are confidential in nature. I have used the following range to cover various sensitivities in the valuation: \$0.75/mcf in the low case value, \$0.95/mcf in the preferred case, and \$1.20/mcf in the high case. The sensitivities I have considered are: different levels of royalties in various projects (generally 15%-20%), different levels of capital expenditure depending in the nature of the development and distance to infrastructure, different levels of operating expenditures, and different levels of prevailing natural gas price.

I have reviewed a discounted cash flow model as an alternative methodology for valuation of the 2P reserves in the Hanging Woman prospect and found that it produces a similar valuation to the preferred case of the \$/mcf valuation. Since the \$/mcf valuation methodology is based on a broader data set and is more easily understood by potential investors, I have used this as my preferred valuation methodology.

Valuation Report Page 3

Qualifications

It is my opinion that my qualifications as an independent expert comply with the Australian Securities & Investments Commission (ASCI) Regulatory Guide 112, Independence of Experts. I graduated from the Colorado School of Mines in 1972 with a Bachelor of Science Degree, and was employed by Exxon Company, USA as a petroleum engineer from 1972 to 1980 in reservoir and production engineering. From 1980 through 2005 I was employed in Casper, Wyoming by Monsanto Company for two years and Wold Oil Properties, Inc. for 23 years as a petroleum engineer and manager responsible for all aspects of field operations and petroleum engineering, including property evaluations, principally dealing with Rocky Mountain oil and gas fields. I have been a consulting petroleum engineer since 2006. I served eight years as Commissioner on the Wyoming Oil & Gas Conservation Commission from 2000 to 2008, and was the interim Supervisor of the Commission in 2009. I am a registered professional engineer in the States of Wyoming and Colorado.

I have no beneficial interest in CADY or GRP, nor do I have any beneficial interest in the Hanging Woman Project.

Declarations

The statements and opinions made in this report are given in good faith and in the belief that such statements are neither false nor misleading. I have relied on technical interpretations prepared by other qualified professionals and information provided by CADY. Where appropriate, I have used information available in the public domain, and have formed opinions based on my experience in coalbed methane property evaluation.

Because of economic and political forces, there is significant uncertainty regarding the forecasting of future hydrocarbon prices and volumes. The recoverable reserves and the income attributable thereto have a direct relationship to the hydrocarbon prices actually received; therefore, volumes of reserves actually recovered and amounts of income actually received may differ significantly from the estimated quantities presented in this report.

Disclaimer

Conclusions in this valuation are based on sound engineering practices, but because of variable conditions and other pertinent engineering and technical information which must be relied upon, no warranty, expressed or implied, as to the accuracy or completeness of the data or of any calculations or opinions herein is made.

Consent

I consent to the inclusion of this report in the Independent Expert's Report prepared by HLB, in the form and context in which it appears and have not withdrawn this consent.

Sincerely,

Robert A. King, P.I

Attachment (1)

ROBERT A. KING, P.E.

1551 THREE CROWNS DRIVE, SUITE 301 CASPER , WYOMING 82604 (307) 266-5464 bobking06@qwestoffice.net

July 21, 2011

GRP Corporation Limited Level 2 Spectrum 100 Railway Rd Subiaco East, WA 6008

Re: Potential Gas Resources Hanging Woman Area CBM Sheridan County, Wyoming

Dear Sirs:

GRP Corporation Limited (to be renamed Cady Energy Limited) ("GRP"), a company listed on the Australian Securities Exchange ("ASX"), has entered into a Share Sale Agreement with the shareholders of Cady Energy Pty Ltd ("Cady Energy"), whereby GRP will obtain 100% of the issued capital of Cady Energy. I have been commissioned by GRP to provide an Independent Engineering Report ("IER") on the "Hanging Woman" prospect ("the Prospect") in Sheridan County, Wyoming in the United States of America. Cady Energy US Inc., a wholly owned subsidiary of Cady Energy, currently holds the exclusive right to acquire the Prospect from the current license holders of the Project (together "Kennedy Oil").

This IER has been prepared on information available up to and including June 1, 2011.

I have evaluated the coalbed methane gas (CBM) potential resources of the 13,280 acre "Hanging Woman" prospect in Sheridan County, Wyoming, and have classified these resources into four categories: proved reserves, probable reserves, possible reserves, and contingent resources. These categories are consistent with the Petroleum Resource Management System (PRMS), published by the Society of Petroleum Engineers (SPE), American Association of Petroleum Geologists (AAPG), World Petroleum Council (WPC) and the Society of Petroleum Evaluation Engineers (SPEE).The attached report details my assumptions and data used in these estimates.

Results of the report are summarized as follows:

Category Proved Reserves Probable Reserves Possible Reserves	MMCF
	0
	50,031
	14,584
Contingent Resources	30,054

It is my opinion that the fourteen coal beds identified in the Hanging Woman prospect by Goolsby, Finley, & Associates (as set out in their report annexed as "Annnexure A" to this IER) are present as described, and likely contain adsorbed methane gas at or exceeding the quantities specified in my report. Because the thicknesses of most of these coals are less than ten feet, the uncertainty of commercial production is the primary factor in my classifications. My estimation of the total recoverable gas resource in the Hanging Woman prospect is approximately 95 MMCF. In order to recover this amount of gas, favorable economic conditions will be required.

Neither I nor those involved in the preparation of this report have any material interest in GRP, or the mineral properties considered in this report. I am remunerated for this report by way of a professional fee determined in accordance to a standard schedule of rates. Payment of fees and expenses is in no way contingent upon the conclusions drawn in this report.

I have given, and have not subsequently withdrawn my permission for the inclusion of this report in the form and context in which it appears.

Sincerely,

Robert A. King /

Attachment

HANGING WOMAN PROSPECT POTENTIAL RESOURCES EVALUATION June 1,2011 Robert A. King, P.E.

Introduction

The coalbed methane gas (CBM) potential resources of the "Hanging Woman" area in Sheridan County, Wyoming were evaluated, and have been classified into four categories consistent with the Petroleum Resource Management System (PRMS): proved reserves, probable reserves, possible reserves, and contingent resources. Geologic information provided by the consulting geological firm of Goolsby, Finley & Associates (GFA), and other pertinent reservoir and well data were evaluated in order to estimate potentially recoverable coalbed methane gas from coal beds within the 13,280 acre prospect area. Existing well information was obtained from Wyoming Oil & Gas Conservation Commission (WOGCC) records, and coal reservoir properties were obtained principally from core analyses of nearby Nance (now J.M. Huber) CBM wells in the Remington and Wyatt CBM Units.

The reserve numbers in this report are estimates only and should not be construed as being exact quantities. They may or may not be actually recovered, and if recovered, could be more or less than the estimated amounts. Moreover, estimates of reserves may increase or decrease as a result of future operations.

This evaluation does not address the economics of development of contingent resources, which would take into consideration drilling and completion procedures and costs, infrastructure costs (pipelines, compression, power, water disposal, etc), gas marketing variables, completion of individual coals, etc.

In my opinion, the use of funds included as specified in the GRP Prospectus is sufficient to complete the minimum agreed work program as detailed in the Sale and Purchase Agreement between Kennedy Oil and Cady Energy Pty Ltd. The use of funds is also sufficient to drill the five wells required to maintain five federal leases by December 5,2011.

Background

In December 2005 the Hanging Woman (CBNG) Unit was approved by the Bureau of Land Management as a 15,194 acre federal exploratory unit (WYW164168X) in the northern part of Sheridan County as depicted in the attached Exhibit A. It was comprised of 12 federal mineral leases totaling 14,274 acres, two State mineral leases totaling 721 acres, and 199 acres of fee (patented) leases. Between 2006 and 2008, Kennedy Oil drilled 30 CBM wells within the Unit in Section 36 T57N R80W. Sixteen of these wells were completed in the Roberts Coal at a depth of about 2,900 feet (Table 1), and the other 14 wells were completed in the shallower Cook and Canyon Coals, as identified by Kennedy Oil, at about 800 feet (Table 2.) In November 2007, Kennedy Oil was granted approval by the WOGCC to commingle coal gas production from the Roberts, Oedekovan, and unnamed coals below the Oedekovan in Section 36 T57N R80W, and portions of Sections 30, 31, and 32 T57N R79W (Docket 461-2007). Only Kennedy Oil's Roberts Coal wells

Background (continued)

were placed on production for de-watering, and to date there have been no sales facilities for the gas. There is no reported commingled production. The Roberts Coal wells produce with rod pumps operated by field gas-fired pumping units, with the water being discharged into pits and excess produced gas vented. Through February 2010, cumulative production from Kennedy Oil's wells in Section 36 totals 2.6 mmcf of gas and about 1.15 million barrels of water (Table 1). The exploratory unit was terminated by the BLM in December 2009, and production from the wells is now accounted for on a lease basis.

There has been recent development of CBM resources to the north and east of the Hanging Woman prospect. Eleven separate coals have been placed on production, and for the most part are currently in the dewatering phase. Development has been primarily on 80 acre spacing.

Geology

GFA identified 14 individual coals that average five feet or greater in thickness across all or part of the Hanging Woman prospect. They determined average coal depth, thickness, and lateral continuity of these coals. These data are summarized in Table 3. GFA's interpretations show the two shallowest identified coals outcropping nearby to the northeast. For reserves and contingent resources determinations, coals shallower than 300 feet were assumed to be non-commercial. As a result, the two shallowest coals are considered potentially commercial across only a portion of the Hanging Woman prospect. The 12 remaining coals are mapped deeper than 300 feet across the entire 15,194 acres of the original Hanging Woman Unit, and are therefore considered potentially commercial across the entire prospect.

GFA's maps and associated report are provided under separate cover in "Annexure A" to this report

Reservoir Properties

Core data available from the United States Geologic Survey (USGS) were used to determine coal conditions and gas content. The USGS, in cooperation with the Wyoming Reservoir Management Group of the Bureau of Land Management, published two reports: Coal Quality and Major, Minor, and Trace Elements in the Powder River, Green River, and Williston Basins, Wyoming and North Dakota (Open-File Report 2007- 1116) and Gas Desorption and Adsorption Isotherm Studies of Coals in the Powder River Basin, Wyoming and Adjacent Basins in Wyoming and North Dakota (Open-File Report 2006-1174). Included in these reports were analyses done on coal cores from three wells in close proximity to the Hanging Woman prospect. These were the J.M. Huber Remington 58-79-30-07A, Remington 57-79-18-03R, and Remington 58-79-30- 01C. A summary of the USGS core work from these wells is presented in Table 4.

Reserves Determinations

Reserves are those quantities which are anticipated to be commercially recovered from known accumulations from a given date forward. All reserve estimates involve some degree of uncertainty. The uncertainty depends chiefly on the amount of reliable geologic and engineering data available at the time of the estimate and the interpretation of these

Reserves Determinations (continued)

data. The relative degree of uncertainty may be conveyed by placing reserves into one of two principal classifications, either proved or unproved. Unproved reserves are less certain to be recovered than proved reserves and may be further sub-classified as probable and possible reserves to denote progressively increasing uncertainty in their recoverability.

Reserves determinations were made volumetrically based on the following assumptions:

• Coal thickness and area based on GFA mapping
• Prospect area of 13,280 acres
• Coal density of 1,791 tons per acre-foot
• Gas content (scf per ton) based on nearby coal coring data obtained by the U. S. Geological Survey, adjusted for coal depth for coals not cored
• Ultimate recovery 80% of calculated gas in place

A critical factor in reserves determination is commerciality, as specified under the PRMS. My determination of reserves in the Hanging Woman prospect is based on the following: 1) significant development capital has been expended and dewatering of the Roberts Coal is advanced, 2) gas content of the Roberts Coal is known from nearby core data published by the US Geological Survey, 3) development of similar coals in the Powder River Basin and the costs associated with these developments are well known and relatively straight forward, utilizing well known technologies, 4) there is a reasonable expectation that a market will exist for the expected sales quantities of production required to justify development, 5) the necessary production and transportation facilities are available through the nearby gas compression and pipeline facilities owned by Bitter Creek Pipelines LLC, and 6) legal, contractual, environmental and other social and economic concerns are likely to be met for the actual implementation of the development project.

Proved

Proved reserves are those quantities of gas which, by analysis of geological and engineering data, can be estimated with reasonable certainty to be commercially recoverable, from a given date forward, from known reservoirs and under current economic conditions, operating methods, and government regulations. Proved reserves require geologic lateral continuity of the coals, pressure data to confirm continuity of the coals, production data to establish coal permeability and capacity to produce gas, and commerciality of existing operations and planned future development.

There currently is no commercial CBM production within the Hanging Woman prospect, nor is there clearly established commercial production immediately adjacent to Hanging Woman. All reported CBM wells within one mile of the Hanging Woman prospect are summarized in Table 5. Through February 2010, forty five wells have average cumulative production of about 7 mmcf of gas and 176,000 barrels of water from 11 identified coals. The majority of these wells are commingled completions from multiple coals.

As a result of the lack of definitive commerciality, no reserves within the prospect area have been qualified as proven.

Reserves Determinations (continued)

Probable

Probable reserves are those quantities of gas which analysis of geological and engineering data suggests are more likely than not to be commercially recoverable. There should be at least a 50 percent probability that the quantities actually recovered will equal or exceed the sum of estimated probable reserves.

Within the Hanging Woman prospect, the Roberts Coal has been identified as laterally continuous across the entire prospect and the thickest of all GFA identified coals (27 feet). In addition, the Roberts Coal core in the nearby Nance Remington 57-79-18- 03R, located within one mile of the prospect boundary, was the deepest coal studied in the USGS Core Study, and recorded the highest average gas content (97.37 scf/ton) of all coals studied.

There has been a limited amount of development from the Roberts Coal in surrounding areas near the Hanging Woman Prospect. Table 6 is a summary of information from the WOGCC showing there have been 37 wells, in addition to the Kennedy Oil wells, drilled in the northern part of Sheridan County and completed in the Roberts (or Roberts equivalent) Coal since 2001. These wells were drilled by St. Mary Land & Exploration, and Windsor Energy. Cumulative production from these 37 wells has totaled 265 mmcf and 3 million barrels of water through February 2010. For the most part, there are not sufficient production data available to perform reliable decline curve analysis on these wells.

Because of definitive geologic, reservoir, and production data, it is my opinion that CBM gas from the Roberts Coal qualifies as probable reserves. As shown in Table 3,1 estimate probable recoverable reserves from the Roberts Coal to be 50,031 mmcf.

Possible

Possible reserves are those quantities of gas which analysis of geological and engineering data suggests are less likely to be recoverable that probable reserves. There should be at least a 10 percent probability that the quantities actually recovered will equal or exceed the sum of estimated proved plus probable plus possible reserves.

Within the Hanging Woman prospect, the average coal thickness cut-off of ten (10) feet was used to differentiate between possible and the less-certain "contingent resources" category. As shown in Table 3,1 estimate possible recoverable reserves from the two coals ten feet or more in thickness, the Roland and FG Coals, to be 14,584 mmcf.

Contingent Resources

Contingent resources are those speculative resources estimated beyond proved, probable, and possible reserves where geologic data suggest the potential for additional reserves, but where the level of proof is insufficient to achieve a "possible rerserves" classification.

Within the Hanging Woman prospect, all identified coals with thickness between five (5) and ten (10) feet are defined as contingent due to the economic uncertainty of commercial production. Because many of these coals are being produced in adjacent locations (as shown on Table 5), a strong case can be made to classify these reserves as "possible." As shown in Table 3,1 estimate contingent resources from the 11 coals between five and ten feet in thickness to be 30,054 mmcf.

Conclusions

• 1. Fourteen separate coals greater than five feet in thickness have been identified in the 13,280 acre Hanging Woman prospect in Township 57 North, Ranges 79-80 West, Sheridan County, Wyoming. These coals total 128 feet in thickness.
• 1. Estimated or measured average adsorbed gas in the identified coals is 40.5 scf per ton. The Roberts Coal averages 27 feet in thickness, and based on offset core analysis of 97.4 scf per ton, is the most prospective coal.
• 1. Kennedy Oil has drilled 30 CBM wells within the prospect area. To date, the wells that have been on production have not de-watered sufficiently to determine gas production capacity.
• 1. Volumetric analysis of potential reserves in the Hanging Woman prospect shows that there may be 118 bcf of coalbed gas in place, of which approximately 95 bcf may be recoverable. Within the Hanging Woman prospect, 50.0 bcf from the Roberts Coal have been classified as probable reserves, 14.6 bcf from other coals greater than ten feet in thickness have been classified as possible reserves, and 30.1 bcf from coals between five and ten feet in thickness have been classified as contingent resources.

Disclaimer

Conclusions in this evaluation are based on sound engineering practices, but because of variable well conditions and other pertinent engineering information which must be relied upon, no warranty, expressed or implied, as to the accuracy or completeness of the data or of any calculations or opinions herein is made.

References

• Goolsby, Finley & Associates geologic work
• John Kennedy personal communication
• Wyoming Oil & Gas Conservation Commission
• USGS Open-File Report 2007-1116, Coal Quality and Major, Minor, and Trace Elements in the Powder River, Green River, and Williston Basins, Wyoming and North Dakota
• USGS Open-File Report 2006-1174, Gas Desorption and Adsorption Isotherm Studies of Coals in the Powder River Basin, Wyoming and Adjacent Basins in Wyoming and North Dakota
• SPE 107308 Powder River Basin Coalbed Methane Wells Reserves and Rates, Swindell, 2007
• Coalbed Methane in Wyoming, Wyoming State Geological Survey, 2000
• Petroleum Resource Management System (PRMS), published by the Society of Petroleum Engineers (SPE), American Association of Petroleum Geologists (AAPG), World Petroleum Council (WPC) and the Society of Petroleum Evaluation Engineers (SPEE).

KENNEDY OIL HANGING WOMAN ROBERTS CBM COMPLETIONS Section 36 T57N R80W Sheridan County, Wyoming

						Cumulative1
Well Name		Qtr/Qtr	Completion Date	TD.ft.	Gas, met	Water, bbl
Hanging Woman	4136-5780	NENE	8/22/2007	2813		84,851
Hanging Woman State	31-36-5780	NWNE	10/31/2006	2844		80,705
Hanging Woman	4236-5780	SENE	8/24/2007	2894	313	65,611
Hanging Woman State	3236-5780	SWNE	9/25/2007	2777		65,241
Hanging Woman State	2136-5780	NENW	10/28/2006	2804	249	73,824
Hanging Woman St	1 1 36-5780	NWNW	10/5/2006	2930	658	84,976
Hanging Woman St	2236-5780	SENW	10/25/2006	2920		71,180
Hanging Woman State	12-36	SWNW	12/27/2002	2836		56,221
Hanging Woman State	4336-5780	NESE	8/31/2007	2852		65,416
Hanging Woman State	3336-5780	NWSE	10/7/2006	2930	296	81,571
Hanging Woman State	4436-5780	SESE	9/25/2007	2853	278	64,261
Hanging Woman	3436-5780	SWSE	10/15/2006	2844		65,501
Hanging Woman St	2336-5780	NESW	9/30/2006	3020		63,590
Hanging Woman St	1336-5780	NWSW	10/26/2006	2950	275	84,620
Hanging Woman	2436-5780	SESW	10/5/2006	3080	281	80,721
Hanging Woman St	1436-5780	SWSW	9/22/2007	2992	258	67,240
					2,608	1,155,529

1 Through February 2010

Source: Wyoming Oil & Gas Conservation Commission

KENNEDY OIL HANGING WOMAN COOK/CANYON CBM COMPLETIONS Section 36 T57N R80W Sheridan County, Wyoming

			Completion
Well Name		Qtr/Qtr	Date	TD.ft.
Hanging Woman State	4136-C-5780	NENE	10/25/2008	674
Hanging Woman State	3136-C-5780	NWNE	10/23/2008	675
Hanging Woman State	4236-C-5780	SENE	10/29/2008	784
Hanging Woman State	2136-C-5780	NENW	10/2/2007	751
Hanging Woman State	1 136-C-5780	NWNW	10/18/2008	817
Hanging Woman State	2236-C-5780	SENW	10/22/2008	904
Hanging Woman State	1236-C-5780	SWNW	10/3/2007	845
Hanging Woman State	4336-C-5780	NESE	10/29/2008	782
Hanging Woman State	3336-C-5780	NWSE	10/20/2008	784
Hanging Woman State	4436-C-5780	SESE	10/30/2008	784
Hanging Woman State	2336-C-5780	NESW	9/28/2007	860
Hanging Woman State	1 336-C-5780	NWSW	10/18/2008	817
Hanging Woman State	2436-C-5780	SESW	10/9/2008	923
Hanging Woman State	1436-C-5780	SWSW	9/26/2007	870

Source: Wyoming Oil & Gas Conservation Commission

HANGING WOMAN AREA CBM RESERVES AND CONTINGENT RESOURCES Sheridan County, Wyoming

Coal1	Avg Depth, Feet1	Avg Thickness, Feet1	Acres1	Acre-Ft	Coal Tons2	Gas Content, scf/ton3	GIP, mmscf	80% GIP, mmscf	Category
Unnamed 1	513	8	8,321	66,569	119,242,029	7.57	903	722	Contingent Resource
Roland	534	17	11,706	198,999	356,458,232	7.88	2,809	2,247	Possible Reserves
Lower Roland	558	7	13,280	92,960	166,515,530	8.24	1,372	1,098	Contingent Resource
Oedekoven	743	6	13,280	79,680i	142,727,597	11.26	1,607	1,286	Contingent Resource
Smith	747	6	13,280	79,680	142,727,597	11.32	1,616	1,293	Contingent Resource
Dietzl	934	9	13,280	119,520	214,091,395	14.854	3,179	2,543	Contingent Resource
DietzS	1,061	6	13,280	79,680	142,727,597	18.45	2,633	2,107	Contingent Resource
Monarch	1,118	8	13,280	106,240	190,303,462	19.794	3,766	3,013	Contingent Resource
Wall	1,469	5	13,280	66,400	118,939,664	28.98	3,447	2,757	Contingent Resource
Pawnee	1,757	6	13,280	79,680	142,727,597	37.81	5,397	4,317	Contingent Resource
Lower Pawnee	1,929	8	13,280	106,240	190,303,462	43.64	8,305	6,644	Contingent Resource
Unnamed 2	1,964	5	13,280	66,400	118,939,664	44.92	5,343	4,274	Contingent Resource
FG	2,474	10	13,280	132,800	237,879,328	64.83	15,422	12,337	Possible Reserves
Roberts	2,675	27	13,280	358,560	642,274,186	97.37*	62,538	50,031	Probable Reserves
		128		1,633,407	2,925,857,339	40.49	118,336	94,669

1 From Goolsby, Finley & Associates geologic evaluation adjusted to 13,280 acres

2 Coal density of 1.318 gm/cc = 0.0411 tons/ft³ = 1791.26 tons/ac-ft

3 From USGS Open-File Report 2007-1174 desorption data corrected to specific area conditions

4 From offset core data

SUMMARY Category Mmcf
Probable Reserves	50,031
Possible Reserves	14,584
Contingent Resources	30,054

TABLE 4 USGS CORE STUDY RESULTS¹ HANGING WOMAN AREA Sheridan County, Wyoming

	Well
	Remington 58-79-30-07A	Remington 57-79-1 8-03R	Remington 58-79-30-01 C
Core Hole #	28	29	30
Operator	J.M. Huber	J.M. Huber	J.M. Huber
API*	49-033-23127	49-033-23136	49-033-23131
Location	SW/NE Sec. 30 T58N R79W	NE/NW Sec. 18T57NR79W	NE/NE Sec. 30 T58N R79W
Date Cored	December 5, 2001	December 8, 2001	December 8, 2001
Core Interval	320'-336'	2190'-2204'	633'-647'
Coal	Anderson Dietz 1 (GFA)	Roberts	Canyon* •Monarch (GFA)
SG, g/cc	1.31	1.34	1.31
Avg scf/ton	14.85	97.37	19.79

1 USGS Open-File Report 2007-1174

CBM COMPLETIONS WITHIN ONE MILE OF HANGING WOMAN PROSPECT Sheridan County, Wyoming

						Cumi	jlative'
Loci	itlon	API*	Well Name		Producing Coals	Mcf	BW
T57N	R79W
Sec. 6	NENW	3326751	Remington	57-79^>&O3CK	Anderson. Canyon, Cook	5,106	125,945
	NESW	3326752	Dome	57-79-06-1 1CK	Anderson, Canyon, Cook	5	158,907
	NESE	3326725	WY State	57-7*06-09KB	Pawnee	0	45,266
	NWNE	3326726	Remington	57-79-06-02KB	Wall, Pawnee, Brewster/Amold, Upper Nance, Knobloch	19	77,105
	NWNE	3326720	Remington	57-79-06-02CK	Anderson, Canyon, Cook	64	118,059
	NESE	3326721	WY State	57-79-06-09CK	Anderson, Cook	4,538	216,674
	NENW		Anderson, Canyon, Cook Remington 57-79-0&03CK 3326751		5,106	125,945
	NESW	3326752	Dome	57-7»06-11CK	Anderson, Canyon, Cook	5	158,907
	NENW	3327668	Remington	57-79-06-03R-H	Roberts	4,800	47,878
	NENW	3327670	Remington	57-79-06-03K-H	Kendrick	0	0
Sec. 7	SWSE	3323137	Remington	57-79-07-15R _j	Roberts	234	65,730
	swsw	3323142	Remington	57-79-07-13R	Roberts	61	69.424
	NENE	3326722	WY State	57-79-07-01CK ,	Anderson, Canyon, Cook	59	106,392
	NENW	3326723	Remington	57-79-07-03CK	Cook	4	167,110
	NENE	3326724	WY State	57-79-07-01 KB	Wall, Pawnee, Brester/ArnokJ. Knobloch	2	99,315
	NESW	3326738	Remington	57-79-07-1 1CK	Anderson, Canyon, Cook	0	170,981
	NESE	3326740	Dome	57-7W7-09CK	Canyon	18	99,566
	NESE	3326741	Dome	57-79-07-09KB	Wall. Pawnee, Brewster/Amold	51	110,539
	NESW	3326743	Remington	57-79-07-1 1KB	Wall, Pawnee, Brewster/Amold	0	18,381
	NENW	3326748	Remington	57-79-07-03KB	Wall, Pawnee. Brewster/Amold, Knobloch	10	70,849
Sec. 16	NENE	3326739	WY State	57-79-1 6-01 KB	Anderson, Canyon, Wall, Pawnee, Brewster/Amold	2	23,620
	NESW	3326776	WY State	57-79-16-1 1KB	Anderson, Wall, Pawnee, Brewster/Amold	3	62,376
	NESE	3326777	WY State	57-79-16-09KB	Anderson, Canyon, Wall, Pawnee. Brewster/Amold	3	42,719
	NENW	3325810	WY State	57-79-16-03KB	Anderson, Canyon, Wall, Pawnee, Brewster/Amold	3	79,786
Sec. 18	NENE	3324103	Remington	57-79-18-01R	Roberts	503	34,069
	NESW	3326764	Remington	57-79-18-1 1KB	Anderson, Canyon, Wall, Pawnee, Brewster/Amold	0	18,312
	NENW	3323133		Nance 57-79-1 8-03WIW	Roland	4	53,511
	SWNE	3323134	Remington	57-79-18-07R	Roberts	20	23,609
	SWNW	3323135	Remington	57-79-18-05R	Roberts	29	24,935
	NENW SWSE	3323136 3326715	Remington Dome	57-79-18-03R 57-79-18-15KB	Roberts Anderson, Canyon, Wall. Pawnee,	106 0	64,110 11,592
					Brewster/Amold
T58N	R79W
Sec. 31	SWNW SWNE	3327180 3327181	Remington	58-79-31 -05CK	Anderson, Canyon, Cook	13,103	175,101
			Remington	58-79-31-07CK	Anderson, Canyon, Cook	35.591	196,911
	NENE NENE	3325664 3325665	Remington Remington	58-79-31-O1CK 58-79-31-01A	Cook	4,060	458,341
	NENW	3325383	Remington	58-79-31-03A	Anderson Anderson	62,565 27,592	306,341
	NENW	3325385	Remington	58-79-31-03CK	Cook	18.386	196,351 746,599
	NESW	3325387	Remington	58-79-31 -11 A	Anderson	9.491	192,021
	NESW	3325390	Remington	58-79-31-1 1CK	Cook	1,409	258,686
	NESE	3325623	Federal	58-79-31-09CK	Anderson, Canyon, Cook	102.607	588,868
T58N	R80W
Sec. 36	SWNE	3327230	WY State	58-80-36-07CK	Anderson, Canyon, Cook	3,720	108,155
	NENE	3325000	WY State	58-80-36-01CK	Anderson, Canyon, Cook	5,175	645.463
	NENW	3325597	WY State	58-80-36-03CK	Anderson, Canyon, Cook	1,825	844,088
	NESE	3325598	WY State	58-80-36-09CK	Anderson, Canyon, Cook	50	344.543
	NESW	3325599	WY State	58-80-36-1 1CK	Anderson, Canyon, Cook	144	372,887
					TOTAL	306,473	7,925,967

'Through Feb. 2010

ROBERTS CBM COMPLETIONS Sheridan County, Wyoming

									Cumulative1
Operator	Well Name	Location		Completion Date	TD, Ft.	Mcf	BW	Comments
St Mary Land & Expl Co	REMINGTON 57-79-06-03R-H	NENW		6 T57N R79W		3/3/2008	4237	4,800	47,878	horizontal well, 4 laterals
St Mary Land & Expl Co	REMINGTON 57-79-07-1 3R	SWSW		7 T57N R79W		11/30/2001	2220	61	69,424
St Mary Land & Expl Co	REMINGTON 57-79-07-1 5R	SWSE		7 T57N R79W		2/1/2002	2181	234	65,730
St Mary Land & Expl Co	REMINGTON 57-79-13-11	NESW		13 T57N R79W		8/7/2003	2404	49	9,658
St Mary Land & Expl Co	REMINGTON 57-79-1 8-07R	SWNE		18 T57N R79W		1/17/2002	2500	20	23,609
St Mary Land & Expl Co	REMINGTON 57-79-1 8-05R	SWNW 18 T57N R79W				12/29/2001	2286	29	24,935
St Mary Land & Expl Co	REMINGTON 57-79-1 8-03R	NENW		18 T57N R79W		12/29/2001	2286	106	64,110
St Mary Land & Expl Co	REMINGTON 57-79-1 8-01 R	NENE		18 T57N R79W		12/10/2002	2412	503	34,069
St Mary Land & Expl Co	REMINGTON 58-79-28-05R-H	SWNW 28 T58N R79W				3/1/2008	3390	3,550	6,623	horizontal well
St Mary Land & Expl Co	REMINGTON 58-79-28-06K-H	SENW		28 T58N R79W		10/28/2006	3280	10,352	29,783	horizontal well
St Mary Land & Expl Co	REMINGTON 58-79-28-06R-H	SENW		28 T58N R79W		10/28/2006	3138	18,565	12,811	horizontal well
St Mary Land & Expl Co	REMINGTON 58-79-29-02R-H	NWNE		29 T58N R79W		1/30/2008	3740	343	12,753	horizontal well
St Mary Land & Expl Co	REMINGTON 58-79-29-08K-H	SENE		29 T58N R79W		11/21/2006	3865	1,666	43,202	horizontal well
St Mary Land & Expl Co	REMINGTON 58-79-29-1 3R-H	SWSW 29 T58N R79W				2/4/2008	4018	5,325	21,302	horizontal well
St Mary Land & Expl Co	REMINGTON 58-79-29-08R-H	SENE		29 T58N R79W		11/28/2006	3642	35,756	63,185	horizontal well
St Mary Land & Expl Co	FEDERAL 58-79-33-05K	SWNW 33 T58N R79W				9/7/2005	2455	39,491	81,482
St Mary Land & Expl Co	REMINGTON 58-79-33-1 5K	SWSE		33 T58N R79W		3/31/2005	2340	51,603	345,545
St Mary Land & Expl Co	FEDERAL 58-79-33-1 3K	SWSW 33 T58N R79W				9/9/2005	2510	27,220	160,238
St Mary Land & Expl Co	FEDERAL 58-79-33-1 1K	NESW		33 T58N R79W		8/11/2005	2424	57	133,400
St Mary Land & Expl Co	REMINGTON 58-79-33-1 K	NENE		33 T58N R79W		1/4/2005	2293	985	43,159
St Mary Land & Expl Co	DOME 58-79-33-07K	SWNE		33 T58N R79W		3/16/2005	2325	59,041	132,935
St Mary Land & Expl Co	REMINGTON 58-79-33-9K	NESE		33 T58N R79W		10/20/2004	2252	1,841	76,962
St Mary Land & Expl Co	DOME 58-79-33-03K	NENW		33 T58N R79W		2/22/2005	2350	2,719	76,879
Windsor Energy Grp LLC	FARMLAND RESERVE 9E-7-56-79	NESE		7 T56N R79W		2/26/2006	3050	49	79,310
Windsor Energy Grp LLC	FARMLAND RESERVE 9E-8-56-79	NESE		8 T56N R79W		10/22/2006	3055	7	98,117
Windsor Energy Grp LLC	FARMLAND RESERVE 11E-8-56-79	NESW		8 T56N R79W		10/24/2005	3052	12	203,449
Windsor Energy Grp LLC	AG RESERVE STATE 11E-9-56-79	NESW			9 T56N R79W	11/6/2005	3008	0	43,252
Windsor Energy Grp LLC	FARMLAND RESERVE 15E-9-56-79	SWSE		9 T56N R79W		11/3/2005	2996	5	88,392
Windsor Energy Grp LLC	AG RESERVE STATE 11E-1 6-56-79	NESW		16 T56N R79W		11/30/2006	2701	0	58,814
Windsor Energy Grp LLC	AG RESERVE STATE 7E-16-56-79	SWNE		16 T56N R79W		11/10/2005	2884	16	125,557
Windsor Energy Grp LLC	AG RESERVE STATE 3E-1 6-56-79	NENW		16 T56N R79W		11/19/2006	2899	35	80,852
Windsor Energy Grp LLC	AG RESERVE STATE 1E-1 6-56-79	NENE		16 T56N R79W		9/28/2005	2900	83	102,471
Windsor Energy Grp LLC	AG RESERVE STATE 13E-1 6-56-79	SWSW 16 T56N R79W				12/9/2005	2672	93	82,832
Windsor Energy Grp LLC	AG RESERVE STATE 15E-1 6-56-79	SWSE		16 T56N R79W		11/19/2005	2715	124	110,991
Windsor Energy Grp LLC	FARMLAND RESERVE 15E-1756-79	SWSE		17 T56N R79W		12/16/2005	2655	66	62,743
Windsor Energy Grp LLC	FARMLAND RESERVE 1E-20 56-79	NENE		20 T56N R79W		12/27/2005	2661	0	16,293
Windsor Energy Grp LLC	FARMLAND RESERVE 3E-21 56-79	NENW		21 T56N R79W		1 1/29/2005	2625	93	240,097
								264,899	2,972,842

Through February 2010

1