24a Wed Apr 8 - Incremental Economics

10 100 1,000 10,000 0 48 96 144 192 240 288 336 384 432 480 Time, months Monthly Gas Volume, Mcf Base Case Stimulated Case Incremental Red Line is the Base Case Green Line is the Stimulated Case Blue Line is the Incremental Increase in Production due to Stimulation (Green Line minus Red Line) Do Not Run Incremental Economics by Simply Running Economics on the Incremental Production 3

10 100 1,000 10,000 0 48 96 144 192 240 288 336 384 432 480 Time, months Monthly Gas Volume, Mcf Base Case Stimulated Case Incremental Below is a comparison between the “proper” way to run incremental economics and running economics on just the incremental production. Base Stimulated Incremental Wellhead Reserves, MMcf 100.4 405.9 305.6 Net Reserves, MMcf 76.3 308.5 232.2 PV0 $17,176 $148,802 $131,625 PV10 $18,072 $49,179 $31,107 Investment $250,000 $250,000 ROR 17.1% 14.2% PVI10% 0.20 0.12 Payout, years 3.67 4.00 Economic Limit, Mcf/day 72 68 Well Life, years 3.3 9.8 285.0 216.6 $847,634 $401,677 $250,000 21.6% 0.78 4.25 1 40 6

Stimulated Case DOES have an Investment and therefore Investment Metrics Can be calculated, but this is for Full Well Economics, not the Incremental production above the “Do Nothing” Case. So, this has little meaning unless the well is not producing at all prior to stimulating. 9

ROR is calculated on the Incremental Cash Flow, just like you did on the individual economic sheets 12