potential well locations into the existing and planned infrastructure, including gathering systems and other surface facilities. In constructing surface facilities, the Company seeks to use reliable, high quality, used equipment in place of new equipment to achieve cost savings. The Company also seeks to minimize cycle time from drilling to hook-up of wells, thereby accelerating cash flow and improving ultimate project economics.

   The Company seeks to use advanced production techniques to exploit and expand its reserve base. Following the discovery of proved reserves, the Company typically continues to evaluate its producing properties through the use of 3-D seismic data to locate undrained fault blocks and identify new drilling prospects and performs further reserve analysis and geological field studies using computer aided exploration techniques. The Company seeks to integrate its 3-D seismic data with reservoir characterization and management systems through the use of geophysical workstations which are compatible with industry standard reservoir simulation programs.

SIGNIFICANT PROJECT AREAS

   This section is an explanation and detail of some relevant project groupings from the Company's overall inventory of seismic data and prospects. It is difficult to uniquely categorize many of the 3-D projects because they were originally screened and selected for multiple objectives. In the Texas Wilcox Areas, additional 3-D data connects and overlaps existing project area grids continues to be acquired and integrated into the Company's prospect evaluations. This further blurs the distinction between original 3-D project areas and, as a result, geographical sub-grouping is used rather than the original project areas for this focus area. The discussion clarifies this organizational framework and highlights the project area and Wilcox area sub-groups where the majority of the expected drilling will take place over the next 12 to 18 months.