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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

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<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>As filed with the Securities and Exchange Commission on March
    4, 2010</B>
</DIV>

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    <!-- /XBRL,DC --><B>Registration
    <FONT style="white-space: nowrap">No.&#160;333-&#160;&#160;&#160;&#160;&#160;&#160;</FONT></B>
</DIV>

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<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

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    <B><FONT style="font-size: 14pt">UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION<BR>
    </FONT><FONT style="font-size: 12pt">Washington,&#160;D.C.
    20549</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

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    <B><FONT style="font-size: 18pt"><FONT style="white-space: nowrap">Form&#160;S-1</FONT></FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt">REGISTRATION STATEMENT<BR>
    UNDER <BR>
    THE SECURITIES ACT OF 1933</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 24pt">Oasis Petroleum Inc.</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I><FONT style="font-size: 8pt">(Exact name of registrant as
    specified in its charter)</FONT></I>
</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
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    <TD width="34%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="32%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
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<TD nowrap align="center" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Delaware</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    <B>1311</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    <B>80-0554627</B>
</TD>
</TR>
<TR valign="bottom">
<TD align="center" valign="top">
    <I><FONT style="font-size: 8pt">(State or other jurisdiction
    of<BR>
    incorporation or organization)</FONT></I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <I><FONT style="font-size: 8pt">(Primary Standard Industrial<BR>
    Classification Code Number)</FONT></I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <I><FONT style="font-size: 8pt">(I.R.S. Employer<BR>
    Identification No.) </FONT></I>
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>1001 Fannin Street, Suite&#160;202</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Houston, Texas 77002</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="white-space: nowrap">(713)&#160;574-1770</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I><FONT style="font-size: 8pt">(Address, including zip code,
    and telephone number, including area code, of registrant&#146;s
    principal executive offices)</FONT></I>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Thomas B. Nusz</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Chairman, President and Chief Executive Officer</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Oasis Petroleum Inc.</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>1001 Fannin Street, Suite&#160;202</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Houston, Texas 77002</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="white-space: nowrap">(713)&#160;574-1770</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I><FONT style="font-size: 8pt">(Name, address, including zip
    code, and telephone number, including area code, of agent for
    service)</FONT></I>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I>Copies to:</I></B>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
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    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="49%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
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<TD align="center" valign="top">
    <B>T. Mark Kelly<BR>
    David P. Oelman<BR>
    Vinson&#160;&#038; Elkins L.L.P.<BR>
    1001 Fannin, Suite&#160;2500<BR>
    Houston, Texas
    <FONT style="white-space: nowrap">77002-6760</FONT><BR>
    <FONT style="white-space: nowrap">(713)&#160;758-2222</FONT></B>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <B>G. Michael O&#146;Leary<BR>
    David C. Buck<BR>
    Andrews Kurth LLP<BR>
    600 Travis Street, Suite 4200<BR>
    Houston, TX 77002<BR>
    (713) 220-4200 </B>
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Approximate date of commencement of proposed sale to the
    public</B>: As soon as practicable after the effective date of
    this registration statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If any of the securities being registered on this Form are to be
    offered on a delayed or continuous basis pursuant to
    Rule&#160;415 under the Securities Act of 1933 check the
    following
    box:&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If this Form is filed to register additional securities for an
    offering pursuant to Rule&#160;462(b) under the Securities Act,
    please check the following box and list the Securities Act
    registration statement number of the earlier effective
    registration statement for the same
    offering.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If this Form is a post-effective amendment filed pursuant to
    Rule&#160;462(c) under the Securities Act, check the following
    box and list the Securities Act registration statement number of
    the earlier effective registration statement for the same
    offering.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If this Form is a post-effective amendment filed pursuant to
    Rule&#160;462(d) under the Securities Act, check the following
    box and list the Securities Act registration statement number of
    the earlier effective registration statement for the same
    offering.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Indicate by check mark whether the registrant is a large
    accelerated filer, an accelerated filer, a non-accelerated
    filer, or a smaller reporting company. See the definitions of
    &#147;large accelerated filer,&#148; &#147;accelerated
    filer&#148; and &#147;smaller reporting company&#148; in
    <FONT style="white-space: nowrap">Rule&#160;12b-2</FONT>
    of the Exchange Act. (Check one):
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="23%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="14%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="35%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="22%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Large&#160;accelerated&#160;filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Accelerated&#160;filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Non-accelerated&#160;filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#254;
    </FONT>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    Smaller&#160;reporting&#160;company&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    (Do&#160;not&#160;check&#160;if&#160;a&#160;smaller&#160;reporting&#160;company)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CALCULATION
    OF REGISTRATION FEE</FONT></B>
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="78%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterright -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterright -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
    <B>Proposed Maximum<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
    <B>Amount of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
    <B>Title of Each Class of<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Aggregate Offering<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Registration<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
    <B>Securities to be Registered</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Price(1)(2)</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fee</B>
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom" style="border-top: 1px solid #000000">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Common Stock, par value $0.001 per share
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    350,000,000
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    $
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 1px solid #000000">
    24,955
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR style="font-size: 1pt">
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes shares of common stock issuable upon exercise of the
    underwriters&#146; option to purchase additional shares of
    common stock.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Estimated solely for the purpose of calculating the registration
    fee pursuant to Rule&#160;457(o) under the Securities Act of
    1933.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>The registrant hereby amends this registration statement on
    such date or dates as may be necessary to delay its effective
    date until the registrant shall file a further amendment which
    specifically states that this registration statement shall
    thereafter become effective in accordance with Section&#160;8(a)
    of the Securities Act of 1933 or until the registration
    statement shall become effective on such date as the Commission
    acting pursuant to said Section&#160;8(a), may determine.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 1pt solid #000000"></CENTER>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 2pt solid #000000"></CENTER>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 94%; margin-left: 3%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE style="color: #FF0000" width="100%" border="1" cellpadding="5"><TR><TD style=text-align:justify>
<FONT style="font-size: 8pt; font-family: Arial, Helvetica; color: #E8112D">The
information in this prospectus is not complete and may be
changed. We and the selling stockholder may not sell these
securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus
is not an offer to sell these securities and we and the selling
stockholder are not soliciting offers to buy these securities in
any state where the offer or sale is not permitted.<BR>
</FONT>
</TD></TR></TABLE>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>
</DIV><!-- END PAGE WIDTH -->
<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="color: #E8112D">(SUBJECT TO COMPLETION, DATED
    MARCH 4, 2010)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>PROSPECTUS<BR>
    Issued&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010</B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Shares</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="h69816h6981601.gif" alt="Oasis Petro LOGO"><B><FONT style="font-size: 14pt">
    </FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 24pt">Oasis Petroleum Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">COMMON STOCK</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Oasis Petroleum Inc. is
    offering&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of its common stock and the selling stockholder is
    offering&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock. We will not receive any proceeds from the sale
    of shares by the selling stockholder. This is our initial public
    offering and no public market currently exists for our shares.
    We anticipate that the initial public offering price of our
    common stock will be between $&#160;&#160;&#160;&#160;&#160; and
    $&#160;&#160;&#160;&#160;&#160; per share.</B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>We intend to apply to list our common stock on the New York
    Stock Exchange under the symbol &#147;OAS&#148;.</B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 12pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Investing in our common stock involves risks. See &#147;Risk
    Factors&#148; beginning on page&#160;13.</B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt; font-variant: SMALL-CAPS">Price
    $&#160;&#160;&#160;&#160;&#160; Per Share</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="59%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Underwriting<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Proceeds to<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Price to<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Discounts and<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Proceeds to<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Selling<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Public</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Commissions</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Company</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Stockholder</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Per Share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oasis Petroleum Inc. and the selling stockholder have granted
    the underwriters the right to purchase up to an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares,
    respectively, of common stock to cover over-allotments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Securities and Exchange Commission and state securities
    regulators have not approved or disapproved of these securities,
    or determined if this prospectus is truthful or complete. Any
    representation to the contrary is a criminal offense.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters expect to deliver the shares of common stock to
    purchasers
    on&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Joint Book-Running Managers</I>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="50%"></TD>
    <TD width="50%"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">    <B><FONT style="font-size: 18pt; font-family: 'Times New Roman', Times">Morgan
    Stanley </FONT></B></TD>
    <TD nowrap align="right">    <B><FONT style="font-size: 18pt; font-family: 'Times New Roman', Times">
    UBS Investment Bank</FONT></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Co-Lead Manager</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 16pt">Simmons&#160;&#038; Company
    International</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">TABLE OF
    CONTENTS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="tocpage"></A>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="97%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#101'>Prospectus Summary</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#102'>The Offering</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#103'>Risk Factors</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#104'>Cautionary Note Regarding Forward-Looking
    Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#105'>Use of Proceeds</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#106'>Dividend Policy</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#107'>Capitalization</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#108'>Dilution</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#109'>Selected Historical Consolidated and Unaudited
    Pro Forma Financial Data</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#110'>Management&#146;s Discussion and Analysis of
    Financial Condition and Results of Operations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#111'>Business</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    58
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#112'>Management</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#113'>Executive Compensation and Other Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    88
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#125'>Certain Relationships and Related Party
    Transactions</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    104
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#114'>Corporate Reorganization</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    105
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#115'>Principal and Selling Stockholders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    107
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#116'>Description of Capital Stock</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    108
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#117'>Shares&#160;Eligible for Future Sale</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    112
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#118'>Material U.S. Federal Income and Estate Tax
    Considerations to Non-U.S. Holders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    114
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#119'>Underwriters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    117
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#120'>Legal Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    120
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#121'>Experts</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    120
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#122'>Where You Can Find More Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    120
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#123'>Index to Financial Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#124'>Glossary of Oil and Natural Gas Terms</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h69816exv10w1.htm">EX-10.1</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h69816exv23w1.htm">EX-23.1</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h69816exv23w2.htm">EX-23.2</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h69816exv23w3.htm">EX-23.3</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h69816exv99w1.htm">EX-99.1</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h69816exv99w2.htm">EX-99.2</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h69816exv99w3.htm">EX-99.3</A></FONT></TD></TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should rely only on the information contained in this
    prospectus and any free writing prospectus prepared by or on
    behalf of us or to which we have referred you. Neither we nor
    the selling stockholder has authorized anyone to provide you
    with information different from that contained in this
    prospectus and any free writing prospectus. We and the selling
    stockholder are offering to sell shares of common stock and
    seeking offers to buy shares of common stock, only in
    jurisdictions where offers and sales are permitted. The
    information in this prospectus is accurate only as of the date
    of this prospectus, regardless of the time of delivery of this
    prospectus or any sale of the common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have not taken any action to permit a public offering of the
    shares of common stock outside the United States or to permit
    the possession or distribution of this prospectus outside the
    United States. Persons outside the United States who come into
    possession of this prospectus must inform themselves about and
    observe any restrictions relating to the offering of the shares
    of common stock and the distribution of this prospectus outside
    the United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Until&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010, all dealers that buy, sell or trade our common stock,
    whether or not participating in this offering, may be required
    to deliver a prospectus. This requirement is in addition to the
    dealers&#146; obligation to deliver a prospectus when acting as
    underwriters and with respect to their unsold allotments or
    subscriptions.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Industry
    and Market Data</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The market data and certain other statistical information used
    throughout this prospectus are based on independent industry
    publications, government publications or other published
    independent sources. Some data is also based on our good faith
    estimates. Although we believe these third-party sources are
    reliable, we have not independently verified the information and
    cannot guarantee its accuracy and completeness.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    i
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->

<A name='101'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PROSPECTUS
    SUMMARY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>This summary provides a brief overview of information
    contained elsewhere in this prospectus. Because it is
    abbreviated, this summary does not contain all of the
    information that you should consider before investing in our
    common stock. You should read the entire prospectus carefully
    before making an investment decision, including the information
    presented under the headings &#147;Risk Factors,&#148;
    &#147;Cautionary Note Regarding Forward-Looking Statements&#148;
    and &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#148; and the historical
    consolidated financial statements and unaudited pro forma
    financial information and related notes thereto included
    elsewhere in this prospectus. Unless otherwise indicated,
    information presented in this prospectus assumes that the
    underwriters&#146; option to purchase additional common shares
    is not exercised. We have provided definitions for certain oil
    and natural gas terms used in this prospectus in the
    &#147;Glossary of Oil and Natural Gas Terms&#148; beginning on
    <FONT style="white-space: nowrap">page&#160;A-1</FONT>
    of this prospectus.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>In this prospectus, unless the context otherwise requires,
    the terms &#147;we,&#148; &#147;us,&#148; &#147;our,&#148; and
    the &#147;company&#148; refer to Oasis Petroleum LLC and its
    subsidiaries before the completion of our corporate
    reorganization and Oasis Petroleum Inc. and its subsidiaries as
    of the completion of our corporate reorganization and
    thereafter.</I>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">OASIS
    PETROLEUM INC.</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are an independent exploration and production company focused
    on the acquisition and development of unconventional oil and
    natural gas resources. We have accumulated approximately
    292,000&#160;net leasehold acres in the Williston Basin,
    approximately 85% of which are undeveloped. We are currently
    focused on exploiting what we have identified as significant
    resource potential from the Bakken and Three Forks formations,
    which are present across a substantial majority of our acreage.
    A report issued by the United States Geologic Survey, or USGS,
    in April 2008 classified these formations as the largest
    continuous oil accumulation ever assessed by it in the
    contiguous United States, with approximately 3.65&#160;billion
    barrels of technically recoverable oil resources. We believe the
    location, size and concentration of our acreage creates an
    opportunity for us to achieve cost, recovery and production
    efficiencies through the large-scale development of our project
    inventory. Our management team has a proven track record in
    identifying, acquiring and executing large, repeatable
    development drilling programs, which we refer to as
    &#147;resource conversion&#148; opportunities, and has
    substantial experience in the Williston Basin. We have built our
    leasehold acreage position in the Williston Basin primarily
    through acquisitions in our three primary project areas, West
    Williston, East Nesson and Sanish. For a description of our
    acquisition activity, please see &#147;&#151;Our Acquisition
    History&#148; below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    DeGolyer and MacNaughton, our independent reserve engineers,
    estimated our net proved reserves to be 13.3&#160;MMBoe as of
    December&#160;31, 2009, 42% of which were classified as proved
    developed and 93% of which were comprised of oil. The following
    table presents summary data for each of our primary project
    areas as of December&#160;31, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="38%">&nbsp;</TD>         <!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>  <!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=02 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>    <!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>  <!-- colindex=03 type=gutter -->
    <TD width="1" align="right">&nbsp;</TD>    <!-- colindex=03 type=lead -->
    <TD width="1" align="right">&nbsp;</TD>    <!-- colindex=03 type=body -->
    <TD width="1" align="left">&nbsp;</TD>     <!-- colindex=03 type=hang1 -->
    <TD width="2">&nbsp;</TD>  <!-- colindex=04 type=gutter -->
    <TD width="1" align="right">&nbsp;</TD>    <!-- colindex=04 type=lead -->
    <TD width="1" align="right">&nbsp;</TD>    <!-- colindex=04 type=body -->
    <TD width="1" align="left">&nbsp;</TD>     <!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>  <!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>  <!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>  <!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=07 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>    <!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=07 type=hang1 -->
    <TD width="2%">&nbsp;</TD>  <!-- colindex=08 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=08 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>    <!-- colindex=08 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=08 type=hang1 -->
    <TD width="2%">&nbsp;</TD>  <!-- colindex=09 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>    <!-- colindex=09 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=09 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>     <!-- colindex=09 type=hang1 -->
    <TD width="2%">&nbsp;</TD>  <!-- colindex=10 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=10 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>    <!-- colindex=10 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=10 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2010 Budget</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Identified Drilling<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Drilling<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Estimated Net<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Daily<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Net<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Locations</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Gross<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Net<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Capex<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Proved Reserves</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Production<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Acreage</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Wells</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Wells</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(In millions)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>MMBoe</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>% Developed</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(Boe/d)(1)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    West Williston(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159,491
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    268
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    106.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    41
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    110
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    55
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,106
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    East Nesson(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    124,004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    113
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,016
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Sanish(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,747
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    88
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    792
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    292,242
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    173.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    91
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,914
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    879
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    293,121
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    173.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    91
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,073
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
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<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents average daily production for the three months ended
    December&#160;31, 2009.</TD>
</TR>

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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

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    <TD width="2%"></TD>
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    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Identified gross and net drilling locations in our West
    Williston and East Nesson project areas are primarily comprised
    of Bakken wells based on 1,280-acre spacing and do not include
    any infill wells targeting the Bakken formation or any primary
    or infill wells targeting the Three Forks formation.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Identified gross and net drilling locations in our Sanish
    project area include a single Bakken infill well per 1,280-acre
    or <FONT style="white-space: nowrap">640-acre</FONT>
    spacing unit (excluding spacing units already containing two
    Bakken producing wells) and include 10&#160;gross (1.6 net)
    primary wells targeting the Three Forks formation.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In our West Williston and East Nesson project areas, we have an
    inventory of approximately 381&#160;gross primary drilling
    locations (23 of which are proved undeveloped), substantially
    all of which are on 1,280-acre spacing targeting the Bakken
    formation. We plan to aggressively develop these specifically
    identified drilling locations using horizontal drilling and
    multi-stage fracture stimulation techniques. In our Sanish
    project area, we have an additional 88&#160;gross non-operated
    drilling locations (63 of which are proved undeveloped). A
    single additional infill well per spacing unit targeting the
    Bakken formation across all three of our Williston Basin project
    areas would add over 500 incremental potential drilling
    locations. We are also evaluating the resource potential in the
    Three Forks formation across our leasehold position and believe
    there may be a significant number of additional potential
    drilling locations targeting this formation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our total 2010 capital expenditure budget is $220&#160;million,
    which consists of:
</DIV>

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<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $134&#160;million for drilling and completing operated wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $45&#160;million for drilling and completing non-operated wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $15&#160;million for maintaining and expanding our leasehold
    position;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $5&#160;million for constructing infrastructure to support
    production in our core project areas;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $21&#160;million in unallocated funds which are available for
    additional drilling and leasing costs and activity.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    While we have budgeted $220&#160;million for these purposes, the
    ultimate amount of capital we will expend may fluctuate
    materially based on market conditions and the success of our
    drilling results as the year progresses. Please see
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations &#151; Liquidity and Capital
    Resources.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Acquisition History</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We built our leasehold position in our West Williston, East
    Nesson and Sanish project areas through the following
    acquisitions and development activities:
</DIV>

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    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In June 2007, we acquired approximately 175,000&#160;net
    leasehold acres in the Williston Basin with then-current net
    production of approximately 1,000 Boe/d. This acreage is the
    core of our West Williston project area.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In May 2008, we entered into a farm-in and purchase arrangement,
    under which we earned or acquired approximately 48,000&#160;net
    leasehold acres, establishing our initial position in the East
    Nesson project area.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In June 2009, we acquired approximately 40,000&#160;net
    leasehold acres with then-current net production of
    approximately 800 Boe/d, approximately 83% of which was from the
    Williston Basin. This acquisition consolidated our acreage in
    the East Nesson project area and established our Sanish project
    area.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In September 2009, we acquired an additional 46,000&#160;net
    leasehold acres with then-current net production of
    approximately 300 Boe/d. This acquisition further consolidated
    our acreage in the East Nesson project area.
</TD>
</TR>

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    <BR>
    2
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Business Strategy</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our goal is to increase stockholder value by building reserves,
    production and cash flows at an attractive return on invested
    capital. We seek to achieve our goals through the following
    strategies:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

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    <TD width="4%"></TD>
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    <TD width="94%"></TD>
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<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Aggressively Develop our Williston Basin Leasehold
    Position.</I>&#160;&#160;We intend to aggressively drill and
    develop our acreage position to maximize the value of our
    resource potential. The aggregate 469&#160;gross drilling
    locations that we have specifically identified in the Bakken
    formation in our three project areas will be our primary targets
    in the near term. Our 2010 drilling plan contemplates drilling
    approximately 35&#160;gross (22.4 net) operated wells in these
    project areas by using two operated drilling rigs for the full
    year and adding up to three additional drilling rigs later in
    the year. Subject to market conditions and rig availability, we
    expect to operate five drilling rigs in 2011, which could enable
    us to drill as many as 60&#160;gross operated wells during that
    year. We believe we have the ability to add additional rigs this
    year if market conditions and program results warrant.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Enhance Returns by Focusing on Operational and Cost
    Efficiencies.</I>&#160;&#160;Our management team is focused on
    continuous improvement of our operating measures and has
    significant experience in successfully converting early-stage
    resource opportunities into cost-efficient development projects.
    We believe the magnitude and concentration of our acreage within
    our project areas provides us with the opportunity to capture
    economies of scale, including the ability to drill multiple
    wells from a single drilling pad, utilizing centralized
    production and fluid handling facilities and reducing the time
    and cost of rig mobilization.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Adopt and Employ Leading Drilling and Completion
    Techniques.</I>&#160;&#160;Our team is focused on enhancing our
    drilling and completion techniques to maximize recovery. We
    believe these techniques have significantly evolved over the
    last several years, resulting in increased initial production
    rates and recoverable hydrocarbons per well through the
    implementation of techniques such as using longer laterals and
    more tightly spaced fracturing stimulation stages. We
    continuously evaluate our internal drilling results and monitor
    the results of other operators to improve our operating
    practices, and we expect our drilling and completion techniques
    will continue to evolve. This continued evolution may
    significantly enhance our initial production rates, ultimate
    recovery factors and rate of return on invested capital.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Pursue Strategic Acquisitions with Significant Resource
    Potential.</I>&#160;&#160;In the near term, we intend to
    identify and acquire additional acreage and producing assets in
    the Williston Basin to supplement our existing operations. Going
    forward, we expect to selectively target additional domestic
    basins that would allow us to employ our resource conversion
    strategy on large undeveloped acreage positions similar to what
    we have accumulated in the Williston Basin. While we have no
    current intention to pursue international opportunities, our
    management team has significant international acquisition and
    operating expertise. If we identify an international opportunity
    with appropriate scale, risk and resource conversion potential,
    our board of directors may approve such an investment should
    they determine it is in the long-term best interest of our
    stockholders to do so.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Competitive Strengths</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have a number of competitive strengths that we believe will
    help us to successfully execute our business strategies:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

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    <TD width="4%"></TD>
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    <TD width="94%"></TD>
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<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Substantial Leasehold Position in one of North America&#146;s
    Leading Unconventional Oil-Resource Plays.</I>&#160;&#160;Our
    current leasehold position of approximately 292,000&#160;net
    leasehold acres in the Williston Basin is highly prospective in
    the Bakken formation. We believe our Williston Basin acreage is
    one of the largest concentrated leasehold positions in the
    basin, and much of our acreage is in areas of significant
    drilling activity by other exploration and production companies.
    While we are initially targeting the Bakken formation, we are
    also evaluating what we believe to be significant prospectivity
    in the Three Forks formation which underlies a large portion of
    our acreage. We expect that the scale and
</TD>
</TR>

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    <BR>
    3
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    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    concentration of our acreage will enable us to continue to
    improve our drilling and completion costs and operational
    efficiency.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

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    <TD width="4%"></TD>
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<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Large, Multi-Year Project Inventory.</I>&#160;&#160;We have
    an inventory of approximately 469&#160;gross drilling locations,
    primarily targeting the Bakken formation. We plan to drill
    35&#160;gross (22.4 net) operated wells across our West
    Williston and East Nesson project areas in 2010, the completion
    of which would represent 14% of our 246&#160;gross identified
    operated drilling locations in these two project areas. We may
    be able to enhance the total recovery from the Bakken formation
    by drilling potential infill locations. In addition, our total
    number of drilling locations may also be substantially increased
    by pursuing the prospectivity we have identified in the Three
    Forks formation.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Management Team with Proven Acquisition and Operating
    Skills.</I>&#160;&#160; Our senior management team has extensive
    expertise in the oil and gas industry as previous members of
    management at Burlington Resources. The senior technical team
    has an average of more than 25&#160;years of industry
    experience, including experience in multiple North American
    resource plays as well as experience in other North American and
    international basins. We believe our management and technical
    team is one of our principal competitive strengths relative to
    our industry peers due to our team&#146;s proven track record in
    identification, acquisition and execution of resource conversion
    opportunities. In addition, this team possesses substantial
    expertise in horizontal drilling techniques and managing and
    acquiring large development programs, and also has prior
    experience in the Williston Basin.
</TD>
</TR>

<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Incentivized Management Team.</I>&#160;&#160;Our management
    team will own a significant direct ownership interest in us
    immediately following the completion of this offering. In
    addition, our management team will own an indirect interest in
    our controlling stockholder, OAS Holding Company LLC, or OAS
    Holdco, which will own&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock upon completion of this offering. Our
    management team may significantly increase its sharing
    percentage in the shares held by OAS Holdco by increasing the
    return on investment for the other members of OAS Holdco. We
    believe our management team&#146;s direct ownership interest
    immediately following the offering as well as their ability to
    increase their interest over time through OAS Holdco provides
    significant incentives to grow the value of our business for the
    benefit of all stockholders. See &#147;Corporate
    Reorganization&#160;&#151; LLC Agreement of OAS Holdco.&#148;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Operating Control over the Majority of our
    Portfolio.</I>&#160;&#160;In order to maintain better control
    over our asset portfolio, we have established a leasehold
    position comprised primarily of properties that we expect to
    operate. Controlling operations will allow us to dictate the
    pace of development as well as the costs, type and timing of
    exploration and development activities. We believe that
    maintaining operational control over the majority of our acreage
    will allow us to better pursue our strategies of enhancing
    returns through operational and cost efficiencies and maximizing
    hydrocarbon recovery through continuous improvement of drilling
    and completion techniques.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Recent
    Developments</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Drilling Activity.</I>&#160;&#160;Since December&#160;31,
    2009, we have drilled four operated wells in the Bakken
    formation, each of which is being completed. Additionally, we
    currently have one operated drilling rig in the West Williston
    project area and another in the East Nesson project area, each
    of which is drilling a well targeting the Bakken formation. Of
    the 16 gross (1.6 net) non-operated wells in progress on
    December 31, 2009, 9 gross (0.7 net) wells have initiated
    production and 7 gross (0.9 net) wells are under completion
    operations. Subsequent to December 31, 2009, an additional 14
    gross (0.9 net) non-operated wells have begun operations and are
    being drilled or completed.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Amended and Restated Credit Facility.</I>&#160;&#160;On
    February&#160;26, 2010, we entered into an amended and restated
    revolving credit facility, which will have a borrowing base of
    $70&#160;million upon completion of this offering. Borrowings
    under our revolving credit facility accrue interest at an
    initial rate of 4.0% per annum. Our revolving credit facility
    matures on February&#160;26, 2014. Please see
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#160;&#151; Liquidity and
    Capital Resources&#160;&#151; Reserve-based credit
    facility.&#148; As of March&#160;1, 2010, we had
    $13.0&#160;million of indebtedness outstanding under our
    revolving credit
</DIV>
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    <BR>
    4
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    facility. We anticipate that a portion of the net proceeds from
    this offering will be used to repay all of our borrowings
    outstanding as of the closing.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Marketing
    and Transportation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Williston Basin crude oil transportation and refining
    infrastructure has grown substantially in recent years, largely
    in response to drilling activity in the Bakken formation. As of
    February&#160;15, 2010, there was approximately
    334,600&#160;barrels per day of crude oil transportation and
    refining capacity in the Williston Basin, comprised of
    276,600&#160;barrels per day of pipeline transportation capacity
    and 58,000&#160;barrels per day of refining capacity at the
    Tesoro Corporation Mandan refinery. In addition,
    60,000&#160;barrels per day of specifically dedicated railcar
    transportation capacity has recently been placed into service in
    the Williston Basin. Based on publicly announced expansion
    projects, pipeline transportation capacity for Williston Basin
    oil production could increase by 30,000 to 115,000&#160;barrels
    per day by 2013, and we believe additional projects are under
    consideration. For a discussion of the potential risks to our
    business that could result from transportation and refining
    infrastructure constraints in the Williston Basin, please see
    &#147;Risk Factors&#160;&#151; Delays and interruptions of
    production from our wells due to marketing and transportation
    constraints in the Williston Basin could cause significant
    fluctuations in our realized oil and natural gas prices.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Risk
    Factors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Investing in our common stock involves risks that include the
    speculative nature of oil and natural gas exploration,
    competition, volatile oil and natural gas prices and other
    material factors. You should read carefully the section entitled
    &#147;Risk Factors&#148; beginning on page&#160;13 for an
    explanation of these risks before investing in our common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Corporate
    Sponsorship and Structure</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We were recently incorporated pursuant to the laws of the State
    of Delaware as Oasis Petroleum Inc. to become a holding company
    for Oasis Petroleum LLC. Oasis Petroleum LLC was formed as a
    Delaware limited liability company on February&#160;26, 2007 by
    certain members of our senior management team and private equity
    funds managed by EnCap Investments L.P., or EnCap. EnCap, which
    was formed in 1988, provides private equity to independent oil
    and gas companies. Since its inception, EnCap has formed
    fourteen oil and gas investment funds with aggregate capital
    commitments of approximately $7.0&#160;billion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the terms of a corporate reorganization that will be
    completed simultaneously with the closing of this offering, all
    of the interests in Oasis Petroleum LLC will be exchanged for
    common stock of Oasis Petroleum Inc., a recently formed Delaware
    corporation. As a result of the reorganization, Oasis Petroleum
    LLC will become a wholly owned subsidiary of Oasis Petroleum
    Inc. Upon completion of this offering, EnCap and its affiliates
    will initially own a&#160;&#160;&#160;&#160;&#160;% indirect
    interest in us through OAS Holdco, the selling stockholder in
    this offering, based on an assumed initial public offering price
    of $&#160;&#160;&#160;&#160;&#160; per share. In addition,
    members of our management will initially own an
    aggregate&#160;&#160;&#160;&#160;&#160;% interest in us through
    direct ownership of our common stock and through their indirect
    interest in OAS Holdco. For more information on our
    reorganization and the ownership of our common stock by our
    principal and selling stockholders, see &#147;Corporate
    Reorganization&#148; and &#147;Principal and Selling
    Stockholders.&#148;
</DIV>
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    <BR>
    5
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following diagrams indicate our current ownership structure
    and our ownership structure after giving effect to our
    reorganization and this offering based on an assumed initial
    public offering price of $&#160;&#160;&#160;&#160;&#160; per
    share.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="h69816h6981602.gif" alt="[Structure Diagram]">
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Corporate
    Information</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our principal executive offices are located at 1001 Fannin
    Street, Suite&#160;202, Houston, Texas 77002, and our telephone
    number at that address is
    <FONT style="white-space: nowrap">(713)&#160;574-1770.</FONT>
    We expect to have an operational website concurrently with the
    completion of this offering. Information on our website or any
    other website is not incorporated by reference herein and does
    not constitute a part of this prospectus.
</DIV>
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    <BR>
    6
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<A name='102'>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">THE
    OFFERING</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="36%"></TD>
    <TD width="1%"></TD>
    <TD width="63%"></TD>
</TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    Common stock offered by Oasis Petroleum Inc.</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    (&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    if the underwriters&#146; over-allotment is exercised in full)</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    Common stock offered by the selling stockholder</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    (&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    if the underwriters&#146; over-allotment is exercised in full)</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    &#160;&#160;Total common stock offered</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    (&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    if the underwriters&#146; over allotment is exercised in full)</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    Common stock to be outstanding after the offering</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    (&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    if the underwriters&#146; over-allotment is exercised in full)</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    Common stock owned by the selling stockholder after the offering</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    (&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    if the underwriters&#146; over-allotment is exercised in full)</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    Over-allotment option</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    We and the selling stockholder have granted the underwriters a
    <FONT style="white-space: nowrap">30-day</FONT>
    option to purchase up to an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    additional shares of our common stock to cover over-allotments.</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    Use of proceeds</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    We expect to receive approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million of net proceeds
    from the sale of the common stock offered by us, based upon the
    assumed initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share (the midpoint of the
    price range set forth on the cover page of this prospectus),
    after deducting underwriting discounts and estimated offering
    expenses. Each $1.00 increase (decrease) in the public offering
    price would increase (decrease) our net proceeds by
    approximately $&#160;&#160;&#160;&#160;&#160;&#160;million. We
    intend to use a portion of net proceeds from this offering to
    repay all outstanding indebtedness under our revolving credit
    facility, approximately $13.0&#160;million of which was
    outstanding on March&#160;1, 2010. The remaining proceeds of
    approximately $&#160;&#160;&#160;&#160;&#160;&#160;million, and
    any proceeds from the exercise of the underwriters&#146; option
    to purchase additional common stock from us, will be used to
    fund exploration, development and other capital expenditures, as
    well as for general corporate purposes. We will not receive any
    proceeds from the sale of shares by the selling stockholder;
    however, EnCap, certain of its affiliates and certain of our
    executive officers will indirectly receive proceeds from such
    sale as a result of a distribution of proceeds by the selling
    stockholder to its members. Affiliates of certain of the
    underwriters are lenders under our revolving credit facility
    and, accordingly, will receive a portion of the proceeds of this
    offering. See &#147;Use of Proceeds&#148; and
    &#147;Underwriters.&#148;</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    Dividend policy</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    We do not anticipate paying any cash dividends on our common
    stock. In addition, our revolving credit facility prohibits us
    from paying cash dividends. See &#147;Dividend Policy.&#148;</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    Risk factors</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    You should carefully read and consider the information beginning
    on page&#160;13 of this prospectus set forth under the heading
    &#147;Risk Factors&#148; and all other information set forth in
    this prospectus before deciding to invest in our common stock.</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
<DIV style="text-indent: -5%; margin-left: 5%">
    Proposed New York Stock Exchange symbol</DIV>
</TD>
    <TD></TD>
    <TD valign="bottom">
    OAS</TD>
</TR>

</TABLE>
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    <BR>
    7
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    Historical Consolidated and Unaudited Pro Forma Financial
    Data</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should read the following summary financial data in
    conjunction with &#147;Selected Historical Consolidated and
    Unaudited Pro Forma Financial Data,&#148; &#147;Corporate
    Reorganization,&#148; &#147;Management&#146;s Discussion and
    Analysis of Financial Condition and Results of Operations&#148;
    and our historical consolidated financial statements and
    unaudited pro forma financial information and related notes
    thereto included elsewhere in this prospectus. The financial
    information included in this prospectus may not be indicative of
    our future results of operations, financial position and cash
    flows.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Set forth below is our summary historical consolidated financial
    data for the period from February&#160;26, 2007, the date of
    inception of Oasis Petroleum LLC, through December&#160;31,
    2007, the years ended December&#160;31, 2008 and 2009 and
    balance sheet data at December&#160;31, 2008 and 2009, all of
    which have been derived from the audited financial statements of
    Oasis Petroleum LLC included elsewhere in this prospectus. The
    balance sheet data at December&#160;31, 2007 has been derived
    from the audited financial statements of Oasis Petroleum LLC not
    included elsewhere in this prospectus. The unaudited pro forma
    financial data for the year ended December&#160;31, 2009, which
    reflects the effects of the acquisition of interests in certain
    oil and gas properties from Kerogen Resources, Inc., is derived
    from the unaudited pro forma financial information included
    elsewhere in this prospectus. The unaudited pro forma financial
    information has been prepared as if the acquisition had taken
    place on January&#160;1, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
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    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Historical</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Pro Forma Year<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="14" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Statement of operations data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil and gas revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,791
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,736
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,755
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    41,999
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Expenses:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Lease operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,946
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,073
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,691
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,274
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,001
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,810
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,160
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,185
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,670
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploration expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,222
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Rig termination(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Impairment of oil and gas properties(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,177
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,117
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gain on sale of properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    General and administrative expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,181
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,452
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,342
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,342
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,864
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    74,551
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    47,310
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    51,806
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (73
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (39,815
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,555
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,807
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Other income (expense):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Change in unrealized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,679
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14,769
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Realized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,062
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,932
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,776
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,404
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,477
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,424
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,654
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,654
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Net loss</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (13,550
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (34,391
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,461
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    For a discussion of our rig termination expenses, see
    Note&#160;10 to our consolidated financial statements.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    In 2008, we recognized a $45.5&#160;million non-cash impairment
    charge on our proved properties to reflect the impact of
    significantly lower oil prices and a $1.6&#160;million
    impairment charge on our unproved properties due to expiring
    leases. See Note&#160;2 to our consolidated financial statements.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak Begin -->
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    8
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
<!-- XBRL Pagebreak End -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="57%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>As of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>2009<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>As Further<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As of December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Adjusted(1)</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Balance sheet data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,282
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,570
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    40,562
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net property, plant and equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,918
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    114,220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    181,573
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    181,573
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    104,145
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    129,068
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    239,553
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Long-term debt
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total members&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36,350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82,459
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    171,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="63%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Other financial data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash provided by operating activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,284
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,766
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash used in investing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (91,988
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (78,478
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (80,756
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash provided by financing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    95,986
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    113,600
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Adjusted EBITDA(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,431
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,269
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,668
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes the effect of our corporate reorganization and the
    effect of this offering as described in &#147;Corporate
    Reorganization,&#148; &#147;Capitalization&#148; and
    &#147;Dilution.&#148;</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Adjusted EBITDA is a non-GAAP financial measure. For a
    definition of Adjusted EBITDA and a reconciliation of Adjusted
    EBITDA to our net loss and net cash provided by operating
    activities, see &#147;&#151;&#160;Non-GAAP&#160;Financial
    Measure&#148; below.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Set forth below is historical financial data for the six months
    ended June&#160;30, 2007 for properties acquired from Bill
    Barrett Corporation, which constitute the accounting predecessor
    to Oasis Petroleum LLC. The historical financial data for the
    six months ended June&#160;30, 2007 have been derived from the
    audited statement of revenues and direct operating expenses for
    the properties acquired from Bill Barrett Corporation included
    elsewhere in this prospectus. Such statement does not reflect
    depreciation, depletion and amortization, general and
    administrative expenses, income taxes or interest expense.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Predecessor</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Statement of operations data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil and gas revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Direct operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,490
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Excess of revenues over direct operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,196
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Non-GAAP&#160;Financial
    Measure</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Adjusted EBITDA is a supplemental non-GAAP financial measure
    that is used by management and external users of our
    consolidated financial statements, such as industry analysts,
    investors, lenders and rating agencies.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We define Adjusted EBITDA as earnings before interest expense,
    income taxes, depreciation, depletion and amortization, property
    impairments, exploration expenses and unrealized derivative
    gains and losses.
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    9
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Adjusted EBITDA is not a measure of net income or cash flows as
    determined by United States generally accepted accounting
    principles, or GAAP.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Management believes Adjusted EBITDA is useful because it allows
    them to more effectively evaluate our operating performance and
    compare the results of our operations from period to period
    without regard to our financing methods or capital structure. We
    exclude the items listed above from net income in arriving at
    Adjusted EBITDA because these amounts can vary substantially
    from company to company within our industry depending upon
    accounting methods and book values of assets, capital structures
    and the method by which the assets were acquired. Adjusted
    EBITDA should not be considered as an alternative to, or more
    meaningful than, net income or cash flows from operating
    activities as determined in accordance with GAAP or as an
    indicator of our operating performance or liquidity. Certain
    items excluded from Adjusted EBITDA are significant components
    in understanding and assessing a company&#146;s financial
    performance, such as a company&#146;s cost of capital and tax
    structure, as well as the historic costs of depreciable assets,
    none of which are components of Adjusted EBITDA. Our
    computations of Adjusted EBITDA may not be comparable to other
    similarly titled measures of other companies. We believe that
    Adjusted EBITDA is a widely followed measure of operating
    performance and may also be used by investors to measure our
    ability to meet debt service requirements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following tables present a reconciliation of the non-GAAP
    financial measure of Adjusted EBITDA to the GAAP financial
    measures of net loss and net cash provided by operating
    activities, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="60%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Adjusted EBITDA reconciliation to Net Loss:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (13,550
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (34,391
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Change in unrealized (gain) loss on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,679
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (14,769
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,043
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,776
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,404
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    912
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,185
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,670
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Impairment of oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,177
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,117
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploration expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,222
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Adjusted EBITDA</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,431
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,269
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    16,668
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="62%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Adjusted EBITDA reconciliation to Net Cash Provided by
    Operating Activities:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash provided by operating activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,284
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,766
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Realized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,062
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,932
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,776
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,404
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    912
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploration expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,942
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gain on sale of properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,455
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Debt discount amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (61
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (107
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (95
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Changes in working capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,330
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,196
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,933
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Adjusted EBITDA</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,431
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,269
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    16,668
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    10
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    Historical Operating and Reserve Data</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table presents summary data with respect to our
    estimated net proved oil and natural gas reserves as of the
    dates indicated. For additional information regarding our
    reserves, as well as the impact of the SEC&#146;s new rules
    governing the presentation of reserve information, see
    &#147;Business.&#148; The reserve estimates at December&#160;31,
    2007 and 2008 presented in the table below are based on reports
    prepared by W.D. Von Gonten&#160;&#038; Co., independent reserve
    engineers, and were prepared consistent with the former rules
    and regulations of the Securities and Exchange Commission, or
    the SEC, regarding oil and natural gas reserve reporting in
    effect during such periods. The reserve estimates at
    December&#160;31, 2009 presented in the table below are based on
    a report prepared by DeGolyer and MacNaughton, independent
    reserve engineers, and were prepared consistent with the
    SEC&#146;s rules regarding oil and natural gas reserve reporting
    that are currently in effect.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="75%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>At December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Reserve Data(1):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Estimated proved reserves:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Oil (MMBbls)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Natural gas (Bcf)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Total estimated proved reserves (MMBoe)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved developed (MMBoe)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Percent developed
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    81
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved undeveloped (MMBoe)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="white-space: nowrap">PV-10</FONT> (in
    millions)(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    121.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    133.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Standardized Measure (in millions)(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    121.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    133.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Our estimated proved reserves and related future net revenues,
    <FONT style="white-space: nowrap">PV-10</FONT> and
    Standardized Measure were determined using index prices for oil
    and natural gas, without giving effect to derivative
    transactions, and were held constant throughout the life of the
    properties. The index prices were $96.00/Bbl for oil and
    $7.16/MMBtu for natural gas at December 31, 2007, and $44.60/Bbl
    for oil and $5.63/MMBtu for natural gas at December 31, 2008,
    and the unweighted arithmetic average first-day-of-the-month
    prices for the prior 12&#160;months were $61.04/Bbl for oil and
    $3.87/MMBtu for natural gas at December 31, 2009.  These prices
    were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="white-space: nowrap">PV-10</FONT> is a
    non-GAAP financial measure and generally differs from
    Standardized Measure, the most directly comparable GAAP
    financial measure, because it does not include the effects of
    income taxes on future net revenues. However, our
    <FONT style="white-space: nowrap">PV-10</FONT> and
    our Standardized Measure are equivalent because as of
    December&#160;31, 2009, we were a limited liability company not
    subject to entity level taxation. Accordingly, no provision for
    federal or state corporate income taxes has been provided
    because taxable income is passed through to our equity holders.
    However, in connection with the closing of this offering, we
    will merge into a corporation that will become a holding company
    for Oasis Petroleum LLC. As a result, we will be treated as a
    taxable entity for federal income tax purposes. Neither
    <FONT style="white-space: nowrap">PV-10</FONT> nor
    Standardized Measure represents an estimate of the fair market
    value of our oil and natural gas properties. We and others in
    the industry use
    <FONT style="white-space: nowrap">PV-10</FONT> as a
    measure to compare the relative size and value of proved
    reserves held by companies without regard to the specific tax
    characteristics of such entities. The
    <FONT style="white-space: nowrap">PV-10</FONT>
    amounts included in the reports of W.D. Von Gonten&#160;&#038;
    Co. at December&#160;31, 2007 and at December&#160;31, 2008 were
    $122.9&#160;million and $19.2&#160;million, respectively,
    because the
    <FONT style="white-space: nowrap">PV-10</FONT>
    amounts included in such reports do not give effect to
    additional estimated plugging and abandonment costs.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Standardized Measure represents the present value of estimated
    future net cash inflows from proved oil and natural gas
    reserves, less estimated future development, production,
    plugging and abandonment costs and income tax expenses (if
    applicable), discounted at 10% per annum to reflect timing of
    future cash flows. In connection with the closing of this
    offering, we will merge into a corporation that will be treated
    as a taxable entity for federal income tax purposes. Future
    calculations of Standardized Measure will </TD>
</TR>
<!-- XBRL Paragraph Pagebreak -->

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    11
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    include the effects of income taxes on future net revenues. For
    further discussion of income taxes, see &#147;Management&#146;s
    Discussion and Analysis of Financial Condition and Results of
    Operations.&#148;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth summary data with respect to our
    production results, average sales prices and production costs on
    a historical basis for the periods presented:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="52%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterright -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="8%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Oasis Petroleum LLC</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Predecessor</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>January&#160;1, 2007<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>through<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30, 2007(1)</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Operating data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Net production volumes:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil (MBbls)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    190
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    379
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    658
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Natural gas (MMcf)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    73
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    123
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    326
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Oil equivalents (MBoe)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    202
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    171
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    400
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    712
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Average daily production (Boe/d)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,092
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,950
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Average sales prices:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil, without realized derivatives (per Bbl)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    53.73
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    83.96
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    88.07
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    55.32
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil, with realized derivatives(3) (per Bbl)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    77.27
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69.79
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    58.82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Natural gas (per Mcf)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6.87
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10.91
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.24
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Costs and expenses (per Boe of production):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Lease operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12.79
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.23
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.70
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12.21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.49
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.08
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.51
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.35
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24.47
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21.73
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23.42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    General and administrative expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18.60
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.64
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.12
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    The historical financial data for the six months ended
    June&#160;30, 2007 have been derived from the audited statement
    of revenues and direct operating expenses for the properties
    acquired from Bill Barrett Corporation included elsewhere in
    this prospectus. Such statement does not reflect depreciation,
    depletion and amortization, general and administrative expenses,
    income taxes or interest expense.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    For the period from February&#160;26, 2007 through June&#160;30,
    2007, we did not engage in oil and gas operating or producing
    activities. Average daily production includes production from
    July&#160;1, 2007 through December&#160;31, 2007.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Realized prices include realized gains or losses on cash
    settlements for our commodity derivatives, which do not qualify
    for hedge accounting. We have not made any estimates of the
    impact of commodities derivatives on the average sales price for
    our predecessor.</TD>
</TR>

</TABLE>
</DIV><!-- End box 1 -->
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    <BR>
    12
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='103'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RISK
    FACTORS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>You should carefully consider the risks described below
    before making an investment decision. Our business, financial
    condition or results of operations could be materially adversely
    affected by any of these risks. The trading price of our common
    stock could decline due to any of these risks, and you may lose
    all or part of your investment.</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Risks
    Related to the Oil and Natural Gas Industry and Our
    Business</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">A
    substantial or extended decline in oil and, to a lesser extent,
    natural gas prices may adversely affect our business, financial
    condition or results of operations and our ability to meet our
    capital expenditure obligations and financial
    commitments.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The price we receive for our oil and, to a lesser extent,
    natural gas, heavily influences our revenue, profitability,
    access to capital and future rate of growth. Oil and natural gas
    are commodities and, therefore, their prices are subject to wide
    fluctuations in response to relatively minor changes in supply
    and demand. Historically, the markets for oil and natural gas
    have been volatile. These markets will likely continue to be
    volatile in the future. The prices we receive for our
    production, and the levels of our production, depend on numerous
    factors beyond our control. These factors include the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    worldwide and regional economic conditions impacting the global
    supply and demand for oil and natural gas;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the actions of the Organization of Petroleum Exporting
    Countries, or OPEC;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the price and quantity of imports of foreign oil and natural gas;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    political conditions in or affecting other oil-producing and
    natural gas-producing countries, including the current conflicts
    in the Middle East and conditions in South America and Russia;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the level of global oil and natural gas exploration and
    production;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the level of global oil and natural gas inventories;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    localized supply and demand fundamentals and transportation
    availability;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    weather conditions and natural disasters;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    domestic and foreign governmental regulations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    speculation as to the future price of oil and the speculative
    trading of oil and natural gas futures contracts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    price and availability of competitors&#146; supplies of oil and
    natural gas;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    technological advances affecting energy consumption;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the price and availability of alternative fuels.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Substantially all of our production is sold to purchasers under
    short-term (less than
    <FONT style="white-space: nowrap">12-month)</FONT>
    contracts at market based prices. Lower oil and natural gas
    prices will reduce our cash flows, borrowing ability and the
    present value of our reserves. See also &#147;&#151;&#160;Our
    exploration, development and exploitation projects require
    substantial capital expenditures. We may be unable to obtain
    needed capital or financing on satisfactory terms, which could
    lead to expiration of our leases or a decline in our oil and
    natural gas reserves.&#148; Lower oil and natural gas prices may
    also reduce the amount of oil and natural gas that we can
    produce economically and may affect our proved reserves. See
    also &#147;&#151;&#160;The present value of future net revenues
    from our proved reserves will not necessarily be the same as the
    current market value of our estimated oil and natural gas
    reserves.&#148;
</DIV>
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    <BR>
    13
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Drilling
    for and producing oil and natural gas are high risk activities
    with many uncertainties that could adversely affect our
    business, financial condition or results of
    operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our future financial condition and results of operations will
    depend on the success of our exploitation, exploration,
    development and production activities. Our oil and natural gas
    exploration and production activities are subject to numerous
    risks beyond our control, including the risk that drilling will
    not result in commercially viable oil or natural gas production.
    Our decisions to purchase, explore, develop or otherwise exploit
    drilling locations or properties will depend in part on the
    evaluation of data obtained through geophysical and geological
    analyses, production data and engineering studies, the results
    of which are often inconclusive or subject to varying
    interpretations. For a discussion of the uncertainty involved in
    these processes, see &#147;&#151;&#160;Our estimated proved
    reserves are based on many assumptions that may turn out to be
    inaccurate. Any significant inaccuracies in these reserve
    estimates or underlying assumptions will materially affect the
    quantities and present value of our reserves.&#148; Our cost of
    drilling, completing and operating wells is often uncertain
    before drilling commences. Overruns in budgeted expenditures are
    common risks that can make a particular project uneconomical.
    Further, many factors may curtail, delay or cancel our scheduled
    drilling projects, including the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    shortages of or delays in obtaining equipment and qualified
    personnel;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    facility or equipment malfunctions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    unexpected operational events;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    pressure or irregularities in geological formations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    adverse weather conditions, such as blizzards and ice storms;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reductions in oil and natural gas prices;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    delays imposed by or resulting from compliance with regulatory
    requirements;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    proximity to and capacity of transportation facilities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    title problems;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    limitations in the market for oil and natural gas.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    estimated proved reserves are based on many assumptions that may
    turn out to be inaccurate. Any significant inaccuracies in these
    reserve estimates or underlying assumptions will materially
    affect the quantities and present value of our
    reserves.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The process of estimating oil and natural gas reserves is
    complex. It requires interpretations of available technical data
    and many assumptions, including assumptions relating to current
    and future economic conditions and commodity prices. Any
    significant inaccuracies in these interpretations or assumptions
    could materially affect the estimated quantities and present
    value of reserves shown in this prospectus. See
    &#147;Business&#160;&#151; Our Operations&#148; for information
    about our estimated oil and natural gas reserves and the
    <FONT style="white-space: nowrap">PV-10</FONT> and
    Standardized Measure of discounted future net revenues as of
    December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In order to prepare our estimates, we must project production
    rates and the timing of development expenditures. We must also
    analyze available geological, geophysical, production and
    engineering data. The extent, quality and reliability of this
    data can vary. The process also requires economic assumptions
    about matters such as oil and natural gas prices, drilling and
    operating expenses, capital expenditures, taxes and availability
    of funds. Although the reserve information contained herein is
    reviewed by independent reserve engineers, estimates of oil and
    natural gas reserves are inherently imprecise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Actual future production, oil and natural gas prices, revenues,
    taxes, development expenditures, operating expenses and
    quantities of recoverable oil and natural gas reserves will vary
    from our estimates. Any significant variance could materially
    affect the estimated quantities and present value of reserves
    shown in this prospectus. In addition, we may adjust estimates
    of proved reserves to reflect production history, results of
    exploration and development, prevailing oil and natural gas
    prices and other factors, many of which are
</DIV>
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    <BR>
    14
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    beyond our control. Due to the limited production history of our
    undeveloped acreage, the estimates of future production
    associated with such properties may be subject to greater
    variance to actual production than would be the case with
    properties having a longer production history.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    present value of future net revenues from our proved reserves
    will not necessarily be the same as the current market value of
    our estimated oil and natural gas reserves.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should not assume that the present value of future net
    revenues from our proved reserves is the current market value of
    our estimated oil and natural gas reserves. For the years ended
    December&#160;31, 2007 and 2008, we based the estimated
    discounted future net revenues from our proved reserves on
    prices and costs in effect on the day of the estimate in
    accordance with previous SEC requirements. In accordance with
    new SEC requirements for the year ended December&#160;31, 2009,
    we have based the estimated discounted future net revenues from
    our proved reserves on the
    <FONT style="white-space: nowrap">12-month</FONT>
    unweighted arithmetic average of the
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    price for the preceding twelve months without giving effect to
    derivative transactions. Actual future net revenues from our oil
    and natural gas properties will be affected by factors such as:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    actual prices we receive for oil and natural gas;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    actual cost of development and production expenditures;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the amount and timing of actual production;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in governmental regulations or taxation.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The timing of both our production and our incurrence of expenses
    in connection with the development and production of oil and
    natural gas properties will affect the timing and amount of
    actual future net revenues from proved reserves, and thus their
    actual present value. In addition, the 10% discount factor we
    use when calculating discounted future net revenues may not be
    the most appropriate discount factor based on interest rates in
    effect from time to time and risks associated with us or the oil
    and natural gas industry in general.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Actual future prices and costs may differ materially from those
    used in the present value estimates included in this prospectus.
    If oil prices decline by $1.00 per Bbl, then our
    <FONT style="white-space: nowrap">PV-10</FONT> as of
    December&#160;31, 2009 would decrease approximately
    $4.9&#160;million. If natural gas prices decline by $0.10 per
    Mcf, then our
    <FONT style="white-space: nowrap">PV-10</FONT> as of
    December&#160;31, 2009 would decrease approximately
    $0.3&#160;million.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    business is difficult to evaluate because we have a limited
    operating history.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In considering whether to invest in our common stock, you should
    consider that there is only limited historical financial and
    operating information available on which to base your evaluation
    of our performance. We were formed in February 2007 and, as a
    result, we have a limited operating history. We face challenges
    and uncertainties in financial planning as a result of the
    unavailability of historical data and uncertainties regarding
    the nature, scope and results of our future activities. New
    companies must develop successful business relationships,
    establish operating procedures, hire staff, install management
    information and other systems, establish facilities and obtain
    licenses, as well as take other measures necessary to conduct
    their intended business activities. We may not be successful in
    implementing our business strategies or in completing the
    development of the infrastructure necessary to conduct our
    business as planned. In the event that our development plan is
    not completed or is delayed, our operating results will be
    adversely affected and our operations will differ materially
    from the activities described in this prospectus. As a result of
    industry factors or factors relating specifically to us, we may
    have to change our methods of conducting business, which may
    cause a material adverse effect on our results of operations and
    financial condition.
</DIV>
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    <BR>
    15
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Part
    of our strategy involves drilling in existing or emerging shale
    plays using some of the latest available horizontal drilling and
    completion techniques. The results of our planned exploratory
    drilling in these plays are subject to drilling and completion
    technique risks and drilling results may not meet our
    expectations for reserves or production. As a result, we may
    incur material write-downs and the value of our undeveloped
    acreage could decline if drilling results are
    unsuccessful.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Operations in the Bakken and the Three Forks formations involve
    utilizing the latest drilling and completion techniques as
    developed by ourselves and our service providers in order to
    maximize cumulative recoveries and therefore generate the
    highest possible returns. Risks that we face while drilling
    include, but are not limited to, landing our well bore in the
    desired drilling zone, staying in the desired drilling zone
    while drilling horizontally through the formation, running our
    casing the entire length of the well bore and being able to run
    tools and other equipment consistently through the horizontal
    well bore. Risks that we face while completing our wells
    include, but are not limited to, being able to fracture
    stimulate the planned number of stages, being able to run tools
    the entire length of the well bore during completion operations
    and successfully cleaning out the well bore after completion of
    the final fracture stimulation stage.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our experience with horizontal drilling in these areas to date
    is limited. Ultimately, the success of these latest drilling and
    completion techniques can only be evaluated over time as more
    wells are drilled and production profiles are established over a
    sufficiently long time period. If our drilling results are less
    than anticipated or we are unable to execute our drilling
    program because of capital constraints, lease expirations,
    access to gathering systems and limited takeaway capacity or
    otherwise,
    <FONT style="white-space: nowrap">and/or</FONT>
    natural gas and oil prices decline, the return on our investment
    in these areas may not be as attractive as we anticipate and we
    could incur material write-downs of unevaluated properties and
    the value of our undeveloped acreage could decline in the future.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    exploration, development and exploitation projects require
    substantial capital expenditures. We may be unable to obtain
    needed capital or financing on satisfactory terms, which could
    lead to expiration of our leases or a decline in our oil and
    natural gas reserves.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our exploration and development activities are capital
    intensive. We make and expect to continue to make substantial
    capital expenditures in our business for the development,
    exploitation, production and acquisition of oil and natural gas
    reserves. Our cash flows used in investing activities were
    $47.4&#160;million related to capital and exploration
    expenditures for the year ended December&#160;31, 2009. Our
    capital expenditure budget for 2010 is approximately
    $220&#160;million, with approximately $179&#160;million
    allocated for drilling and completion operations. To date, our
    capital expenditures have been financed with capital
    contributions from EnCap and other private investors, borrowings
    under our revolving credit facility and net cash provided by
    operating activities. DeGolyer and MacNaughton projects that we
    will incur capital costs in excess of $113&#160;million in the
    next three years to develop the proved undeveloped reserves in
    the Williston Basin covered by its December&#160;31, 2009
    reserve report. Because these costs cover less than 12% of our
    total potential drilling locations, we will be required to
    generate or raise multiples of this amount of capital to develop
    all of our potential drilling locations should we elect to do
    so. The actual amount and timing of our future capital
    expenditures may differ materially from our estimates as a
    result of, among other things, commodity prices, actual drilling
    results, the availability of drilling rigs and other services
    and equipment, and regulatory, technological and competitive
    developments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A significant improvement in product prices could result in an
    increase in our capital expenditures. We intend to finance our
    future capital expenditures primarily through cash flows
    provided by operating activities, borrowings under our revolving
    credit facility and net proceeds from this offering; however,
    our financing needs may require us to alter or increase our
    capitalization substantially through the issuance of debt or
    additional equity securities or the sale of non-strategic
    assets. The issuance of additional debt may require that a
    portion of our cash flows provided by operating activities be
    used for the payment of principal and interest on our debt,
    thereby reducing our ability to use cash flows to fund working
    capital, capital expenditures and acquisitions. The issuance of
    additional equity securities could have a dilutive effect on the
    value of your common stock.
</DIV>
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    <BR>
    16
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our cash flows provided by operating activities and access to
    capital are subject to a number of variables, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our proved reserves;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the level of oil and natural gas we are able to produce from
    existing wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the prices at which our oil and natural gas are sold;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the costs of developing and producing our oil and natural gas
    production;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to acquire, locate and produce new reserves;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the ability and willingness of our banks to lend;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to access the equity and debt capital markets.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the borrowing base under our revolving credit facility or our
    revenues decrease as a result of lower oil or natural gas
    prices, operating difficulties, declines in reserves or for any
    other reason, we may have limited ability to obtain the capital
    necessary to sustain our operations at current levels. If
    additional capital is needed, we may not be able to obtain debt
    or equity financing on terms favorable to us, or at all. If cash
    generated by operations or cash available under our revolving
    credit facility is not sufficient to meet our capital
    requirements, the failure to obtain additional financing could
    result in a curtailment of our operations relating to
    development of our drilling locations, which in turn could lead
    to a possible expiration of our leases and a decline in our oil
    and natural gas reserves, and could adversely affect our
    business, financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">If oil
    and natural gas prices decrease, we may be required to take
    write-downs of the carrying values of our oil and natural gas
    properties.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We review our proved oil and natural gas properties for
    impairment whenever events and circumstances indicate that a
    decline in the recoverability of their carrying value may have
    occurred. Based on specific market factors and circumstances at
    the time of prospective impairment reviews, and the continuing
    evaluation of development plans, production data, economics and
    other factors, we may be required to write down the carrying
    value of our oil and natural gas properties, which may result in
    a decrease in the amount available under our revolving credit
    facility. A write-down constitutes a non-cash charge to
    earnings. We may incur impairment charges in the future, which
    could have a material adverse effect on our ability to borrow
    under our revolving credit facility and our results of
    operations for the periods in which such charges are taken.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    will not be the operator on all of our drilling locations, and,
    therefore, we will not be able to control the timing of
    exploration or development efforts, associated costs, or the
    rate of production of any
    <FONT style="white-space: nowrap">non-operated</FONT>
    assets.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect that we will not be the operator on approximately 48%
    of our identified gross drilling locations. As we carry out our
    exploration and development programs, we may enter into
    arrangements with respect to existing or future drilling
    locations that result in a greater proportion of our locations
    being operated by others. As a result, we may have limited
    ability to exercise influence over the operations of the
    drilling locations operated by our partners. Dependence on the
    operator could prevent us from realizing our target returns for
    those locations. The success and timing of exploration and
    development activities operated by our partners will depend on a
    number of factors that will be largely outside of our control,
    including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the timing and amount of capital expenditures;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the operator&#146;s expertise and financial resources;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    approval of other participants in drilling wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    selection of technology;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the rate of production of reserves, if any.
</TD>
</TR>

</TABLE>
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    <BR>
    17
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This limited ability to exercise control over the operations of
    some of our drilling locations may cause a material adverse
    effect on our results of operations and financial condition.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Substantially
    all of our producing properties and operations are located in
    the Williston Basin region, making us vulnerable to risks
    associated with operating in one major geographic
    area.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, approximately 99% of our proved
    reserves and approximately 96% of our production were located in
    the Williston Basin in northeastern Montana and northwestern
    North Dakota. As a result, we may be disproportionately exposed
    to the impact of delays or interruptions of production from
    these wells caused by transportation capacity constraints,
    curtailment of production, availability of equipment,
    facilities, personnel or services, significant governmental
    regulation, natural disasters, adverse weather conditions, plant
    closures for scheduled maintenance or interruption of
    transportation of oil or natural gas produced from the wells in
    this area. Due to the concentrated nature of our portfolio of
    properties, a number of our properties could experience any of
    the same conditions at the same time, resulting in a relatively
    greater impact on our results of operations than they might have
    on other companies that have a more diversified portfolio of
    properties. Such delays or interruptions could have a material
    adverse effect on our financial condition and results of
    operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    business depends on oil and natural gas gathering and
    transportation facilities, most of which are owned by third
    parties.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The marketability of our oil and natural gas production depends
    in part on the availability, proximity and capacity of gathering
    and pipeline systems owned by third parties. The unavailability
    of, or lack of, available capacity on these systems and
    facilities could result in the shut-in of producing wells or the
    delay, or discontinuance of, development plans for properties.
    See also &#147;&#151;&#160;Delays and interruptions of
    production from our wells due to marketing and transportation
    constraints in the Williston Basin could cause significant
    fluctuations in our realized oil and natural gas prices.&#148;
    We generally do not purchase firm transportation on third party
    facilities and, therefore, the transportation of our production
    can be interrupted by those having firm arrangements. Federal
    and state regulation of oil and natural gas production and
    transportation, tax and energy policies, changes in supply and
    demand, pipeline pressures, damage to or destruction of
    pipelines and general economic conditions could adversely affect
    our ability to produce, gather and transport our oil and natural
    gas.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The disruption of third-party facilities due to maintenance
    <FONT style="white-space: nowrap">and/or</FONT>
    weather could also negatively impact our ability to market and
    deliver our products. We have no control over when or if such
    facilities are restored or what prices will be charged. A total
    shut-in of production could materially affect us due to a lack
    of cash flow, and if a substantial portion of the production is
    hedged at lower than market prices, those financial hedges would
    have to be paid from borrowings absent sufficient cash flow.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Delays
    and interruptions of production from our wells due to marketing
    and transportation constraints in the Williston Basin could
    cause significant fluctuations in our realized oil and natural
    gas prices.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Williston Basin crude oil marketing and transportation
    environment has historically been characterized by periods when
    oil production has surpassed local transportation and refining
    capacity, resulting in substantial discounts in the price
    received for crude oil versus prices quoted for West Texas
    Intermediate (WTI) crude oil. For example, the difference
    between the WTI crude oil price and the Tesoro North Dakota
    Sweet oil price as of December, 2008 and 2009 was $14.80 per Bbl
    and $10.29 per Bbl, respectively. Such fluctuations and
    discounts could have a material adverse effect on our financial
    condition and results of operations.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    development of our proved undeveloped reserves in the Williston
    Basin and other areas of operation may take longer and may
    require higher levels of capital expenditures than we currently
    anticipate. Therefore, our undeveloped reserves may not be
    ultimately developed or produced.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Approximately 58% of our total proved reserves were classified
    as proved undeveloped as of December&#160;31, 2009. Development
    of these reserves may take longer and require higher levels of
    capital expenditures than we currently anticipate. Delays in the
    development of our reserves or increases in costs to drill and
    develop such reserves will reduce the
    <FONT style="white-space: nowrap">PV-10</FONT> value
    of our estimated proved undeveloped reserves and future net
    revenues estimated for such reserves and may result in some
    projects becoming uneconomic. In addition, delays in the
    development of reserves could cause us to have to reclassify our
    proved reserves as unproved reserves.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Unless
    we replace our oil and natural gas reserves, our reserves and
    production will decline, which would adversely affect our
    business, financial condition and results of
    operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless we conduct successful development, exploitation and
    exploration activities or acquire properties containing proved
    reserves, our proved reserves will decline as those reserves are
    produced. Producing oil and natural gas reservoirs generally are
    characterized by declining production rates that vary depending
    upon reservoir characteristics and other factors. Our future oil
    and natural gas reserves and production, and therefore our cash
    flows and income, are highly dependent on our success in
    efficiently developing and exploiting our current reserves and
    economically finding or acquiring additional recoverable
    reserves. We may not be able to develop, exploit, find or
    acquire additional reserves to replace our current and future
    production at acceptable costs. If we are unable to replace our
    current and future production, the value of our reserves will
    decrease, and our business, financial condition and results of
    operations would be adversely affected.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    unavailability or high cost of additional drilling rigs,
    equipment, supplies, personnel and oilfield services could
    adversely affect our ability to execute our exploration and
    development plans within our budget and on a timely
    basis.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Shortages or the high cost of drilling rigs, equipment,
    supplies, personnel or oilfield services could delay or
    adversely affect our development and exploration operations or
    cause us to incur significant expenditures that are not provided
    for in our capital budget, which could have a material adverse
    effect on our business, financial condition or results of
    operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Market
    conditions or operational impediments may hinder our access to
    oil and natural gas markets or delay our
    production.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Market conditions or the unavailability of satisfactory oil and
    natural gas transportation arrangements may hinder our access to
    oil and natural gas markets or delay our production. The
    availability of a ready market for our oil and natural gas
    production depends on a number of factors, including the demand
    for and supply of oil and natural gas and the proximity of
    reserves to pipelines and terminal facilities. Our ability to
    market our production depends, in substantial part, on the
    availability and capacity of gathering systems, pipelines and
    processing facilities owned and operated by third-parties. Our
    failure to obtain such services on acceptable terms could
    materially harm our business. We may be required to shut in
    wells due to lack of a market or inadequacy or unavailability of
    crude oil or natural gas pipelines or gathering system capacity.
    If our production becomes shut-in for any of these or other
    reasons, we would be unable to realize revenue from those wells
    until other arrangements were made to deliver the products to
    market.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    incur substantial losses and be subject to substantial liability
    claims as a result of our oil and natural gas operations.
    Additionally, we may not be insured for, or our insurance may be
    inadequate to protect us against, these risks.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are not insured against all risks. Losses and liabilities
    arising from uninsured and underinsured events could materially
    and adversely affect our business, financial condition or
    results of operations. Our oil and
</DIV>
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    19
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    natural gas exploration and production activities are subject to
    all of the operating risks associated with drilling for and
    producing oil and natural gas, including the possibility of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    environmental hazards, such as uncontrollable flows of oil,
    natural gas, brine, well fluids, toxic gas or other pollution
    into the environment, including groundwater and shoreline
    contamination;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    abnormally pressured formations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    mechanical difficulties, such as stuck oilfield drilling and
    service tools and casing collapse;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    personal injuries and death;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    natural disasters.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any of these risks could adversely affect our ability to conduct
    operations or result in substantial losses to us as a result of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    injury or loss of life;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    damage to and destruction of property, natural resources and
    equipment;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    pollution and other environmental damage;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    regulatory investigations and penalties;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    suspension of our operations;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    repair and remediation costs.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We may elect not to obtain insurance if we believe that the cost
    of available insurance is excessive relative to the risks
    presented. In addition, pollution and environmental risks
    generally are not fully insurable. The occurrence of an event
    that is not fully covered by insurance could have a material
    adverse effect on our business, financial condition and results
    of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Drilling
    locations that we decide to drill may not yield oil or natural
    gas in commercially viable quantities.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We describe some of our drilling locations and our plans to
    explore those drilling locations in this prospectus. Our
    drilling locations are in various stages of evaluation, ranging
    from a location which is ready to drill to a location that will
    require substantial additional interpretation. There is no way
    to predict in advance of drilling and testing whether any
    particular location will yield oil or natural gas in sufficient
    quantities to recover drilling or completion costs or to be
    economically viable. The use of technologies and the study of
    producing fields in the same area will not enable us to know
    conclusively prior to drilling whether oil or natural gas will
    be present or, if present, whether oil or natural gas will be
    present in sufficient quantities to be economically viable. Even
    if sufficient amounts of oil or natural gas exist, we may damage
    the potentially productive hydrocarbon bearing formation or
    experience mechanical difficulties while drilling or completing
    the well, resulting in a reduction in production from the well
    or abandonment of the well. If we drill additional wells that we
    identify as dry holes in our current and future drilling
    locations, our drilling success rate may decline and materially
    harm our business. We cannot assure you that the analogies we
    draw from available data from other wells, more fully explored
    locations or producing fields will be applicable to our drilling
    locations. Further, initial production rates reported by us or
    other operators in the Williston Basin may not be indicative of
    future or long-term production rates. In sum, the cost of
    drilling, completing and operating any well is often uncertain,
    and new wells may not be productive.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have incurred losses from operations during certain periods
    since our inception and may continue to do so in the
    future.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We incurred net losses of $15.2&#160;million and
    $34.4&#160;million for the years ended December&#160;31, 2009
    and 2008, respectively, and $13.6&#160;million in the period
    from February&#160;26, 2007 (inception) through
    December&#160;31, 2007. Our development of and participation in
    an increasingly larger number of drilling locations has required
    and will continue to require substantial capital expenditures.
    The uncertainty and risks described in this
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    prospectus may impede our ability to economically find, develop,
    exploit and acquire oil and natural gas reserves. As a result,
    we may not be able to achieve or sustain profitability or
    positive cash flows provided by operating activities in the
    future.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    potential drilling location inventories are scheduled over
    several years, making them susceptible to uncertainties that
    could materially alter the occurrence or timing of their
    drilling. In addition, we may not be able to raise the
    substantial amount of capital that would be necessary to drill a
    substantial portion of our potential drilling
    locations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our management has identified and scheduled drilling locations
    as an estimation of our future multi-year drilling activities on
    our existing acreage. As of December&#160;31, 2009, only 86 of
    our 469 specifically identified potential future gross drilling
    locations were attributed to proved undeveloped reserves. These
    potential drilling locations, including those without proved
    undeveloped reserves, represent a significant part of our growth
    strategy. Our ability to drill and develop these locations is
    subject to a number of uncertainties, including the availability
    of capital, seasonal conditions, regulatory approvals, oil and
    natural gas prices, costs and drilling results. Because of these
    uncertainties, we do not know if the numerous potential drilling
    locations we have identified will ever be drilled or if we will
    be able to produce oil or natural gas from these or any other
    potential drilling locations. Pursuant to a new SEC rule and
    guidance, subject to limited exceptions, proved undeveloped
    reserves may only be booked if they relate to wells scheduled to
    be drilled within five years of the date of booking. This new
    rule and guidance may limit our potential to book additional
    proved undeveloped reserves as we pursue our drilling program.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    acreage must be drilled before lease expiration, generally
    within three to five years, in order to hold the acreage by
    production. In the highly competitive market for acreage,
    failure to drill sufficient wells in order to hold acreage will
    result in a substantial lease renewal cost, or if renewal is not
    feasible, loss of our lease and prospective drilling
    opportunities.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless production is established within the spacing units
    covering the undeveloped acres on which some of the locations
    are identified, the leases for such acreage will expire. As of
    December&#160;31, 2009, we had leases representing
    45,640&#160;net acres expiring in 2010, 59,559&#160;net acres
    expiring in 2011, and 31,642&#160;net acres expiring in 2012.
    The cost to renew such leases may increase significantly, and we
    may not be able to renew such leases on commercially reasonable
    terms or at all. In addition, on certain portions of our
    acreage, third-party leases become immediately effective if our
    leases expire. As such, our actual drilling activities may
    materially differ from our current expectations, which could
    adversely affect our business.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    operations are subject to environmental and operational safety
    laws and regulations that may expose us to significant costs and
    liabilities.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our oil and natural gas exploration and production operations
    are subject to stringent and complex federal, state and local
    laws and regulations governing health and safety aspects of our
    operations, the discharge of materials into the environment or
    otherwise relating to environmental protection. These laws and
    regulations may impose numerous obligations that are applicable
    to our operations including the acquisition of a permit before
    conducting drilling or underground injection activities; the
    restriction of types, quantities and concentration of materials
    that can be released into the environment; the limitation or
    prohibition of drilling activities on certain lands lying within
    wilderness, wetlands and other protected areas; the application
    of specific health and safety criteria addressing worker
    protection; and the imposition of substantial liabilities for
    pollution resulting from operations. Numerous governmental
    authorities, such as the U.S.&#160;Environmental Protection
    Agency, or the EPA, and analogous state agencies have the power
    to enforce compliance with these laws and regulations and the
    permits issued under them, oftentimes requiring difficult and
    costly actions. Failure to comply with these laws and
    regulations may result in the assessment of administrative,
    civil or criminal penalties; the imposition of investigatory or
    remedial obligations; and the issuance of injunctions limiting
    or preventing some or all of our operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There is inherent risk of incurring significant environmental
    costs and liabilities in the performance of our operations due
    to our handling of petroleum hydrocarbons and wastes, because of
    air emissions and waste
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    water discharges related to our operations, and as a result of
    historical industry operations and waste disposal practices.
    Under certain environmental laws and regulations, we could be
    subject to joint and several, strict liability for the removal
    or remediation of previously released materials or property
    contamination regardless of whether we were responsible for the
    release or contamination or if the operations were not in
    compliance with all applicable laws at the time those actions
    were taken. Private parties, including the owners of properties
    upon which our wells are drilled and facilities where our
    petroleum hydrocarbons or wastes are taken for reclamation or
    disposal, may also have the right to pursue legal actions to
    enforce compliance as well as to seek damages for non-compliance
    with environmental laws and regulations or for personal injury
    or property damage. In addition, the risk of accidental spills
    or releases could expose us to significant liabilities that
    could have a material adverse effect on our financial condition
    or results of operations. Changes in environmental laws and
    regulations occur frequently, and any changes that result in
    more stringent or costly waste handling, storage, transport,
    disposal or cleanup requirements could require us to make
    significant expenditures to attain and maintain compliance and
    may otherwise have a material adverse effect on our own results
    of operations, competitive position or financial condition. We
    may not be able to recover some or any of these costs from
    insurance.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Climate
    change laws and regulations restricting emissions of
    &#147;greenhouse gases&#148; could result in increased operating
    costs and reduced demand for the oil and natural gas that we
    produce while the physical effects of climate change could
    disrupt our production and cause us to incur significant costs
    in preparing for or responding to those effects.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On December&#160;15, 2009, the EPA published its findings that
    emissions of carbon dioxide, methane and other &#147;greenhouse
    gases&#148; present an endangerment to human health and the
    environment because emissions of such gases are, according to
    the EPA, contributing to warming of the earth&#146;s atmosphere
    and other climatic changes. These findings by the EPA allow the
    agency to proceed with the adoption and implementation of
    regulations that would restrict emissions of greenhouse gases
    under existing provisions of the federal Clean Air Act.
    Consequently, the EPA proposed two sets of regulations that
    would require a reduction in emissions of greenhouse gases from
    motor vehicles and, also, could trigger permit review for
    greenhouse gas emissions from certain stationary sources. In
    addition, on October&#160;30, 2009, the EPA published a final
    rule requiring the reporting of greenhouse gas emissions from
    specified large greenhouse gas emission sources in the United
    States beginning in 2011 for emissions occurring in 2010. The
    adoption and implementation of any regulations imposing
    reporting obligations on, or limiting emissions of greenhouse
    gases from, our equipment and operations could require us to
    incur costs to reduce emissions of greenhouse gases associated
    with our operations or could adversely affect demand for the oil
    and natural gas we produce.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Also, on June&#160;26, 2009, the U.S.&#160;House of
    Representatives passed the American Clean Energy and Security
    Act of 2009, or ACESA, which would establish an economy-wide
    <FONT style="white-space: nowrap">cap-and-trade</FONT>
    program to reduce U.S.&#160;emissions of greenhouse gases
    including carbon dioxide and methane that may contribute to
    warming of the Earth&#146;s atmosphere and other climatic
    changes. ACESA would require a 17&#160;percent reduction in
    greenhouse gas emissions from 2005 levels by 2020 and just over
    an 80&#160;percent reduction of such emissions by 2050. Under
    this legislation, the EPA would issue a capped and steadily
    declining number of tradable emissions allowances to certain
    major sources of greenhouse gas emissions so that such sources
    could continue to emit greenhouse gases into the atmosphere.
    These allowances would be expected to escalate significantly in
    cost over time. The net effect of ACESA will be to impose
    increasing costs on the combustion of carbon-based fuels such as
    oil, refined petroleum products and natural gas. The
    U.S.&#160;Senate has begun work on its own legislation for
    restricting domestic greenhouse gas emissions and President
    Obama has indicated his support of legislation to reduce
    greenhouse gas emissions through an emission allowance system.
    Although it is not possible at this time to predict when the
    Senate may act on climate change legislation or how any bill
    passed by the Senate would be reconciled with ACESA, any future
    federal laws or implementing regulations that may be adopted to
    address greenhouse gas emissions could require us to incur
    increased operating costs and could adversely affect demand for
    the oil and natural gas we produce.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Finally, it should be noted that some scientists have concluded
    that increasing concentrations of greenhouse gases in the
    Earth&#146;s atmosphere may produce climate changes that have
    significant physical
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    effects, such as increased frequency and severity of storms,
    floods and other climatic events. If any such effects were to
    occur, they could have an adverse effect on our exploration and
    production operations. Significant physical effects of climate
    change could also have an indirect affect on our financing and
    operations by disrupting the transportation or process-related
    services provided by midstream companies, service companies or
    suppliers with whom we have a business relationship. We may not
    be able to recover through insurance some or any of the damages,
    losses, or costs that may result from potential physical effects
    of climate change.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Federal
    and state legislative and regulatory initiatives relating to
    hydraulic fracturing could result in increased costs and
    additional operating restrictions or delays.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The U.S.&#160;Congress is considering legislation to amend the
    federal Safe Drinking Water Act to require the disclosure of
    chemicals used by the oil and natural gas industry in the
    hydraulic fracturing process. Hydraulic fracturing is an
    important and commonly used process in the completion of
    unconventional oil and natural gas wells in shale and tight sand
    formations. This process involves the injection of water, sand
    and chemicals under pressure into rock formations to stimulate
    oil and natural gas production. Sponsors of these bills, which
    are currently pending in the Energy and Commerce Committee and
    the Environmental and Public Works Committee of the House of
    Representatives and Senate, respectively, have asserted that
    chemicals used in the fracturing process could adversely affect
    drinking water supplies. The proposed legislation would require
    the reporting and public disclosure of chemicals used in the
    fracturing process, which could make it easier for third parties
    opposing the hydraulic fracturing process to initiate legal
    proceedings based on allegations that specific chemicals used in
    the fracturing process could adversely affect groundwater. In
    addition, these bills, if adopted, could establish an additional
    level of regulation at the federal level that could lead to
    operational delays or increased operating costs and could result
    in additional regulatory burdens that could make it more
    difficult to perform hydraulic fracturing and increase our costs
    of compliance and doing business.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Competition
    in the oil and natural gas industry is intense, making it more
    difficult for us to acquire properties, market oil and natural
    gas and secure trained personnel.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our ability to acquire additional drilling locations and to find
    and develop reserves in the future will depend on our ability to
    evaluate and select suitable properties and to consummate
    transactions in a highly competitive environment for acquiring
    properties, marketing oil and natural gas and securing equipment
    and trained personnel. Also, there is substantial competition
    for capital available for investment in the oil and natural gas
    industry. Many of our competitors possess and employ financial,
    technical and personnel resources substantially greater than
    ours. Those companies may be able to pay more for productive oil
    and natural gas properties and exploratory drilling locations or
    to identify, evaluate, bid for and purchase a greater number of
    properties and locations than our financial or personnel
    resources permit. Furthermore, these companies may also be
    better able to withstand the financial pressures of unsuccessful
    drilling attempts, sustained periods of volatility in financial
    markets and generally adverse global and industry-wide economic
    conditions, and may be better able to absorb the burdens
    resulting from changes in relevant laws and regulations, which
    would adversely affect our competitive position. In addition,
    companies may be able to offer better compensation packages to
    attract and retain qualified personnel than we are able to
    offer. The cost to attract and retain qualified personnel has
    increased over the past few years due to competition and may
    increase substantially in the future. We may not be able to
    compete successfully in the future in acquiring prospective
    reserves, developing reserves, marketing hydrocarbons,
    attracting and retaining quality personnel and raising
    additional capital, which could have a material adverse effect
    on our business.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    loss of senior management or technical personnel could adversely
    affect our operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To a large extent, we depend on the services of our senior
    management and technical personnel. The loss of the services of
    our senior management or technical personnel, including Thomas
    B. Nusz, our Chairman, President and Chief Executive Officer,
    and Taylor L. Reid, our Executive Vice President and Chief
    Operating Officer, could have a material adverse effect on our
    operations. We do not maintain, nor do we plan to obtain, any
    insurance against the loss of any of these individuals.
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Seasonal
    weather conditions adversely affect our ability to conduct
    drilling activities in some of the areas where we
    operate.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oil and natural gas operations in the Williston Basin are
    adversely affected by seasonal weather conditions. In the
    Williston Basin, drilling and other oil and natural gas
    activities cannot be conducted as effectively during the winter
    months. Severe winter weather conditions limit and may
    temporarily halt our ability to operate during such conditions.
    These constraints and the resulting shortages or high costs
    could delay or temporarily halt our operations and materially
    increase our operating and capital costs.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    derivative activities could result in financial losses or could
    reduce our income.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To achieve more predictable cash flows and to reduce our
    exposure to adverse fluctuations in the prices of oil and
    natural gas, we currently, and may in the future, enter into
    derivative arrangements for a portion of our oil and natural gas
    production, including collars and fixed-price swaps. We have not
    designated any of our derivative instruments as hedges for
    accounting purposes and record all derivative instruments on our
    balance sheet at fair value. Changes in the fair value of our
    derivative instruments are recognized in earnings. Accordingly,
    our earnings may fluctuate significantly as a result of changes
    in the fair value of our derivative instruments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Derivative arrangements also expose us to the risk of financial
    loss in some circumstances, including when:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    production is less than the volume covered by the derivative
    instruments;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the counter-party to the derivative instrument defaults on its
    contract obligations;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    there is an increase in the differential between the underlying
    price in the derivative instrument and actual prices received.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, these types of derivative arrangements limit the
    benefit we would receive from increases in the prices for oil
    and natural gas and may expose us to cash margin requirements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    adoption of derivatives legislation by Congress could have an
    adverse impact on our ability to hedge risks associated with our
    business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We enter into derivative contracts in order to hedge a portion
    of our oil production. Congress is currently considering
    legislation to impose restrictions on certain transactions
    involving derivatives, which could affect the use of derivatives
    in hedging transactions. ACESA contains provisions that would
    prohibit private energy commodity derivative and hedging
    transactions. ACESA would expand the power of the Commodity
    Futures Trading Commission, or the CFTC, to regulate derivative
    transactions related to energy commodities, including oil and
    natural gas, and to mandate clearance of such derivative
    contracts through registered derivative clearing organizations.
    Under ACESA, the CFTC&#146;s expanded authority over energy
    derivatives would terminate upon the adoption of general
    legislation covering derivative regulatory reform. The CFTC is
    considering whether to set limits on trading and positions in
    commodities with finite supply, particularly energy commodities,
    such as crude oil, natural gas and other energy products. The
    CFTC also is evaluating whether position limits should be
    applied consistently across all markets and participants.
    Separately, two committees of the House of Representatives, the
    Financial Services and Agriculture Committees, acted on
    October&#160;15, 2009 and October&#160;21, 2009, respectively,
    to adopt legislation that would impose comprehensive regulation
    on the
    <FONT style="white-space: nowrap">over-the-counter</FONT>
    (OTC) derivatives marketplace. This legislation would subject
    swap dealers and major swap participants to substantial
    supervision and regulation, including capital standards, margin
    requirements, business conduct standards, and recordkeeping and
    reporting requirements. It also would require central clearing
    for transactions entered into between swap dealers or major swap
    participants, and would provide the CFTC with authority to
    impose position limits in the OTC derivatives markets. A major
    swap participant generally would be someone other than a dealer
    who maintains a &#147;substantial&#148; position in outstanding
    swaps other than swaps used for commercial hedging, or whose
    positions create substantial exposure to its counterparties or
    the system. Although it is not possible at this time to predict
    whether or when Congress may act on derivatives legislation or
    how any climate change bill approved by the Senate would be
    reconciled with
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    ACESA, any laws or regulations that may be adopted that subject
    us to additional capital or margin requirements relating to, or
    to additional restrictions on, our trading and commodity
    positions could have an adverse effect on our ability to hedge
    risks associated with our business or on the cost of our hedging
    activity.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Increased
    costs of capital could adversely affect our
    business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our business and operating results can be harmed by factors such
    as the availability, terms and cost of capital, increases in
    interest rates or a reduction in credit rating. Changes in any
    one or more of these factors could cause our cost of doing
    business to increase, limit our access to capital, limit our
    ability to pursue acquisition opportunities, reduce our cash
    flows available for drilling and place us at a competitive
    disadvantage. Recent and continuing disruptions and volatility
    in the global financial markets may lead to an increase in
    interest rates or a contraction in credit availability impacting
    our ability to finance our operations. We require continued
    access to capital. A significant reduction in the availability
    of credit could materially and adversely affect our ability to
    achieve our planned growth and operating results.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    revolving credit facility contains certain covenants that may
    inhibit our ability to make certain investments, incur
    additional indebtedness and engage in certain other
    transactions, which could adversely affect our ability to meet
    our future goals.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our revolving credit facility includes certain covenants that,
    among other things, restrict:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our investments, loans and advances and the payment of dividends
    and other restricted payments;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our incurrence of additional indebtedness;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the granting of liens, other than liens created pursuant to the
    revolving credit facility and certain permitted liens;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    mergers, consolidations and sales of all or a substantial part
    of our business or properties;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the hedging, forward sale or swap of our production of crude oil
    or natural gas or other commodities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the sale of assets (other than production sold in the ordinary
    course of business);&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our capital expenditures.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our revolving credit facility requires us to maintain certain
    financial ratios, such as leverage ratios. All of these
    restrictive covenants may restrict our ability to expand or
    pursue our business strategies. Our ability to comply with these
    and other provisions of our revolving credit facility may be
    impacted by changes in economic or business conditions, results
    of operations or events beyond our control. The breach of any of
    these covenants could result in a default under our revolving
    credit facility, in which case, depending on the actions taken
    by the lenders thereunder or their successors or assignees, such
    lenders could elect to declare all amounts borrowed under our
    revolving credit facility, together with accrued interest, to be
    due and payable. If we were unable to repay such borrowings or
    interest, our lenders could proceed against their collateral. If
    the indebtedness under our revolving credit facility were to be
    accelerated, our assets may not be sufficient to repay in full
    such indebtedness.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    level of indebtedness may increase and reduce our financial
    flexibility.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon the completion of this offering, we expect to have no
    indebtedness outstanding and will have a borrowing capacity of
    $70&#160;million under our revolving credit facility. In the
    future, we may incur significant indebtedness in order to make
    future acquisitions or to develop our properties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our level of indebtedness could affect our operations in several
    ways, including the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a significant portion of our cash flows could be used to service
    our indebtedness;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a high level of debt would increase our vulnerability to general
    adverse economic and industry conditions;
</TD>
</TR>

</TABLE>
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    <BR>
    25
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the covenants contained in the agreements governing our
    outstanding indebtedness will limit our ability to borrow
    additional funds, dispose of assets, pay dividends and make
    certain investments;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a high level of debt may place us at a competitive disadvantage
    compared to our competitors that are less leveraged and
    therefore, may be able to take advantage of opportunities that
    our indebtedness would prevent us from pursuing;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our debt covenants may also affect our flexibility in planning
    for, and reacting to, changes in the economy and in our industry;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a high level of debt may make it more likely that a reduction in
    our borrowing base following a periodic redetermination could
    require us to repay a portion of our then-outstanding bank
    borrowings;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a high level of debt may impair our ability to obtain additional
    financing in the future for working capital, capital
    expenditures, acquisitions, general corporate or other purposes.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A high level of indebtedness increases the risk that we may
    default on our debt obligations. Our ability to meet our debt
    obligations and to reduce our level of indebtedness depends on
    our future performance. General economic conditions, oil and
    natural gas prices and financial, business and other factors
    affect our operations and our future performance. Many of these
    factors are beyond our control. We may not be able to generate
    sufficient cash flows to pay the interest on our debt and future
    working capital, borrowings or equity financing may not be
    available to pay or refinance such debt. Factors that will
    affect our ability to raise cash through an offering of our
    capital stock or a refinancing of our debt include financial
    market conditions, the value of our assets and our performance
    at the time we need capital.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, our bank borrowing base is subject to periodic
    redeterminations. We could be forced to repay a portion of our
    bank borrowings due to redeterminations of our borrowing base.
    If we are forced to do so, we may not have sufficient funds to
    make such repayments. If we do not have sufficient funds and are
    otherwise unable to negotiate renewals of our borrowings or
    arrange new financing, we may have to sell significant assets.
    Any such sale could have a material adverse effect on our
    business and financial results.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    inability of one or more of our customers to meet their
    obligations to us may adversely affect our financial
    results.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our principal exposures to credit risk are through receivables
    resulting from the sale of our oil and natural gas production
    ($9.1&#160;million in receivables at December&#160;31, 2009),
    which we market to energy marketing companies, refineries and
    affiliates, advances to joint interest parties
    ($4.6&#160;million at December&#160;31, 2009), joint interest
    receivables ($1.3&#160;million at December&#160;31, 2009), and
    commodity derivatives contracts ($0.2&#160;million at
    December&#160;31, 2009).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are subject to credit risk due to the concentration of our
    oil and natural gas receivables with several significant
    customers. This concentration of customers may impact our
    overall credit risk since these entities may be similarly
    affected by changes in economic and other conditions. For the
    year ended December&#160;31, 2008, sales to Tesoro Refining and
    Marketing Company and Texon L.P. accounted for approximately 57%
    and 14%, respectively, of our total sales. For the year ended
    December&#160;31, 2009, sales to Tesoro Refining and Marketing
    Company and Texon L.P. accounted for approximately 32% and 30%,
    respectively, of our total sales. We do not require our
    customers to post collateral. The inability or failure of our
    significant customers to meet their obligations to us or their
    insolvency or liquidation may adversely affect our financial
    results.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Joint interest receivables arise from billing entities who own a
    partial interest in the wells we operate. These entities
    participate in our wells primarily based on their ownership in
    leases on which we wish to drill. We have limited ability to
    control participation in our wells. In addition, our oil and
    natural gas derivative arrangements expose us to credit risk in
    the event of nonperformance by counterparties.
</DIV>
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    <BR>
    26
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    be subject to risks in connection with acquisitions and the
    integration of significant acquisitions may be
    difficult.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We periodically evaluate acquisitions of reserves, properties,
    prospects and leaseholds and other strategic transactions that
    appear to fit within our overall business strategy. The
    successful acquisition of producing properties requires an
    assessment of several factors, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    recoverable reserves;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    future oil and natural gas prices and their appropriate
    differentials;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    development and operating costs;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    potential environmental and other liabilities.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accuracy of these assessments is inherently uncertain. In
    connection with these assessments, we perform a review of the
    subject properties that we believe to be generally consistent
    with industry practices. Our review will not reveal all existing
    or potential problems nor will it permit us to become
    sufficiently familiar with the properties to fully assess their
    deficiencies and potential recoverable reserves. Inspections may
    not always be performed on every well, and environmental
    problems are not necessarily observable even when an inspection
    is undertaken. Even when problems are identified, the seller may
    be unwilling or unable to provide effective contractual
    protection against all or part of the problems. We often are not
    entitled to contractual indemnification for environmental
    liabilities and acquire properties on an &#147;as is&#148; basis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Significant acquisitions and other strategic transactions may
    involve other risks, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    diversion of our management&#146;s attention to evaluating,
    negotiating and integrating significant acquisitions and
    strategic transactions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    challenge and cost of integrating acquired operations,
    information management and other technology systems and business
    cultures with those of ours while carrying on our ongoing
    business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    difficulty associated with coordinating geographically separate
    organizations;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    challenge of attracting and retaining personnel associated with
    acquired operations.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The process of integrating operations could cause an
    interruption of, or loss of momentum in, the activities of our
    business. Members of our senior management may be required to
    devote considerable amounts of time to this integration process,
    which will decrease the time they will have to manage our
    business. If our senior management is not able to effectively
    manage the integration process, or if any significant business
    activities are interrupted as a result of the integration
    process, our business could suffer.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">If we
    fail to realize the anticipated benefits of a significant
    acquisition, our results of operations may be lower than we
    expect.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The success of a significant acquisition will depend, in part,
    on our ability to realize anticipated growth opportunities from
    combining the acquired assets or operations with those of ours.
    Even if a combination is successful, it may not be possible to
    realize the full benefits we may expect in estimated proved
    reserves, production volume, cost savings from operating
    synergies or other benefits anticipated from an acquisition or
    realize these benefits within the expected time frame.
    Anticipated benefits of an acquisition may be offset by
    operating losses relating to changes in commodity prices, or in
    oil and natural gas industry conditions, or by risks and
    uncertainties relating to the exploratory prospects of the
    combined assets or operations, or an increase in operating or
    other costs or other difficulties. If we fail to realize the
    benefits we anticipate from an acquisition, our results of
    operations may be adversely affected.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    incur losses as a result of title defects in the properties in
    which we invest.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    It is our practice in acquiring oil and gas leases or interests
    not to incur the expense of retaining lawyers to examine the
    title to the mineral interest. Rather, we rely upon the judgment
    of oil and gas lease brokers or
</DIV>
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    <BR>
    27
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    landmen who perform the fieldwork in examining records in the
    appropriate governmental office before attempting to acquire a
    lease in a specific mineral interest.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the drilling of an oil or gas well, however, it is the
    normal practice in our industry for the person or company acting
    as the operator of the well to obtain a preliminary title review
    to ensure there are no obvious defects in title to the well.
    Frequently, as a result of such examinations, certain curative
    work must be done to correct defects in the marketability of the
    title, and such curative work entails expense. Our failure to
    cure any title defects may adversely impact our ability in the
    future to increase production and reserves. There is no
    assurance that we will not suffer a monetary loss from title
    defects or title failure. Additionally, undeveloped acreage has
    greater risk of title defects than developed acreage. If there
    are any title defects or defects in assignment of leasehold
    rights in properties in which we hold an interest, we will
    suffer a financial loss.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Risks
    Relating to the Offering and our Common Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    initial public offering price of our common stock may not be
    indicative of the market price of our common stock after this
    offering. In addition, an active liquid trading market for our
    common stock may not develop and our stock price may be
    volatile.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to this offering, our common stock was not traded on any
    market. An active and liquid trading market for our common stock
    may not develop or be maintained after this offering. Liquid and
    active trading markets usually result in less price volatility
    and more efficiency in carrying out investors&#146; purchase and
    sale orders. The market price of our common stock could vary
    significantly as a result of a number of factors, some of which
    are beyond our control. In the event of a drop in the market
    price of our common stock, you could lose a substantial part or
    all of your investment in our common stock. The initial public
    offering price will be negotiated between us, the selling
    stockholder and representatives of the underwriters, based on
    numerous factors which we discuss in the
    &#147;Underwriters&#148; section of this prospectus, and may not
    be indicative of the market price of our common stock after this
    offering. Consequently, you may not be able to sell shares of
    our common stock at prices equal to or greater than the price
    paid by you in the offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following factors could affect our stock price:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our operating and financial performance and drilling locations,
    including reserve estimates;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    quarterly variations in the rate of growth of our financial
    indicators, such as net income per share, net income and
    revenues;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in revenue or earnings estimates or publication of
    reports by equity research analysts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    speculation in the press or investment community;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    sales of our common stock by us, the selling stockholder or
    other stockholders, or the perception that such sales may occur;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    general market conditions, including fluctuations in commodity
    prices;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    domestic and international economic, legal and regulatory
    factors unrelated to our performance.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The stock markets in general have experienced extreme volatility
    that has often been unrelated to the operating performance of
    particular companies. These broad market fluctuations may
    adversely affect the trading price of our common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Purchasers
    of common stock in this offering will experience immediate and
    substantial dilution of $&#160;&#160;&#160;&#160;&#160;&#160;per
    share.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Based on an assumed initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share, purchasers of our
    common stock in this offering will experience an immediate and
    substantial dilution of $&#160;&#160;&#160;&#160;&#160; per
    share in the pro forma as adjusted net tangible book value per
    share of common stock from the initial public offering price,
    and our pro forma as adjusted net tangible book value as of
    December&#160;31, 2009 after giving effect to this offering
    would be $&#160;&#160;&#160;&#160;&#160; per share. See
    &#147;Dilution&#148; for a complete description of the
    calculation of net tangible book value.
</DIV>
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    28
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Because
    we are a relatively small company, the requirements of being a
    public company, including compliance with the reporting
    requirements of the Exchange Act and the requirements of the
    <FONT style="white-space: nowrap">Sarbanes-Oxley</FONT>
    Act, may strain our resources, increase our costs and distract
    management; and we may be unable to comply with these
    requirements in a timely or cost-effective manner.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a public company with listed equity securities, we will need
    to comply with new laws, regulations and requirements, certain
    corporate governance provisions of the Sarbanes-Oxley Act of
    2002, related regulations of the SEC and the requirements of the
    New York Stock Exchange, or the NYSE, with which we are not
    required to comply as a private company. Complying with these
    statutes, regulations and requirements will occupy a significant
    amount of time of our board of directors and management and will
    significantly increase our costs and expenses. We will
    need&#160;to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    institute a more comprehensive compliance function;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    design, establish, evaluate and maintain a system of internal
    controls over financial reporting in compliance with the
    requirements of Section&#160;404 of the Sarbanes-Oxley Act of
    2002 and the related rules and regulations of the SEC and the
    Public Company Accounting Oversight Board;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    comply with rules promulgated by the NYSE;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    prepare and distribute periodic public reports in compliance
    with our obligations under the federal securities laws;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    establish new internal policies, such as those relating to
    disclosure controls and procedures and insider trading;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    involve and retain to a greater degree outside counsel and
    accountants in the above activities;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    establish an investor relations function.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, we also expect that being a public company subject
    to these rules and regulations will require us to accept less
    director and officer liability insurance coverage than we desire
    or to incur substantial costs to obtain coverage. These factors
    could also make it more difficult for us to attract and retain
    qualified members of our board of directors, particularly to
    serve on our audit committee, and qualified executive officers.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">In
    connection with past audits of our financial statements, our
    independent registered public accounting firm identified and
    reported audit adjustments to management. Certain audit
    adjustments were deemed to be the result of internal control
    deficiencies that constitute material weaknesses in our internal
    control over financial reporting. If one or more material
    weaknesses persist or if we fail to establish and maintain
    effective internal control over financial reporting, our ability
    to accurately report our financial results could be adversely
    affected.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the completion of this offering, we have been a private
    company with limited accounting personnel to adequately execute
    our accounting processes and other supervisory resources with
    which to address our internal control over financial reporting.
    As such, we have not maintained an effective control environment
    in that the design and execution of our controls has not
    consistently resulted in effective review and supervision by
    individuals with financial reporting oversight roles. The lack
    of adequate staffing levels resulted in insufficient time spent
    on review and approval of certain information used to prepare
    our financial statements. We have concluded that these control
    deficiencies constitute a material weakness in our control
    environment. A material weakness is a control deficiency, or a
    combination of control deficiencies, in internal control over
    financial reporting, such that there is a reasonable possibility
    that a material misstatement of our annual or interim financial
    statements will not be prevented or detected on a timely basis.
    The control deficiencies described above, at varying degrees of
    severity, contributed to the material weaknesses in the control
    environment as further described in &#147;Management&#146;s
    Discussion and Analysis of Financial Condition and Results of
    Operations -Internal Controls and Procedures&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In response, we have begun the process of evaluating our
    internal control over financial reporting, although we are in
    the early phases of our review and will not complete our review
    until well after this
</DIV>
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    <BR>
    29
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    offering is completed. We cannot predict the outcome of our
    review at this time. During the course of the review, we may
    identify additional control deficiencies of varying degrees of
    severity, in addition to the material weaknesses discussed
    above. Although remediation efforts are still in progress,
    management has taken steps to address the causes of our audit
    adjustments and to improve our internal control over financial
    reporting, including the implementation of new accounting
    processes and control procedures and the identification of gaps
    in our skills base and expertise of the staff required to meet
    the financial reporting requirements of a public company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are not currently required to comply with the SEC&#146;s
    rules implementing Section 404 of the
    <FONT style="white-space: nowrap">Sarbanes-Oxley</FONT>
    Act of 2002, and are therefore not required to make a formal
    assessment of the effectiveness of our internal control over
    financial reporting for that purpose. Upon becoming a public
    company, we will be required to comply with the SEC&#146;s rules
    implementing Section 302 of the Sarbanes-Oxley Act of 2002,
    which will require our management to certify financial and other
    information in our quarterly and annual reports and provide an
    annual management report on the effectiveness of our internal
    control over financial reporting. We will not be required to
    make our first assessment of our internal control over financial
    reporting until the year following our first annual report
    required to be filed with the SEC. To comply with the
    requirements of being a public company, we will need to upgrade
    our systems, including information technology, implement
    additional financial and management controls, reporting systems
    and procedures and hire additional accounting, finance and legal
    staff.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our efforts to develop and maintain our internal controls may
    not be successful, and we may be unable to maintain effective
    controls over our financial processes and reporting in the
    future and comply with the certification and reporting
    obligations under Sections&#160;302 and 404 of the
    <FONT style="white-space: nowrap">Sarbanes-Oxley</FONT>
    Act. Any failure to develop or maintain effective controls, or
    any difficulties encountered in our implementation or
    improvement of our internal controls over financial reporting
    could result in material misstatements that are not prevented or
    detected on a timely basis, which could potentially subject us
    to sanctions or investigations by the SEC, the NYSE or other
    regulatory authorities. Ineffective internal controls could also
    cause investors to lose confidence in our reported financial
    information.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We do
    not intend to pay, and we are currently prohibited from paying,
    dividends on our common stock and, consequently, your only
    opportunity to achieve a return on your investment is if the
    price of our stock appreciates.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We do not plan to declare dividends on shares of our common
    stock in the foreseeable future. Additionally, we are currently
    prohibited from making any cash dividends pursuant to the terms
    of our revolving credit facility. Consequently, your only
    opportunity to achieve a return on your investment in us will be
    if the market price of our common stock appreciates, which may
    not occur, and you sell your shares at a profit. There is no
    guarantee that the price of our common stock that will prevail
    in the market after this offering will ever exceed the price
    that you pay.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Future
    sales of our common stock in the public market could lower our
    stock price, and any additional capital raised by us through the
    sale of equity or convertible securities may dilute your
    ownership in us.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We may sell additional shares of common stock in subsequent
    public offerings. We may also issue additional shares of common
    stock or convertible securities. Assuming no exercise of the
    underwriters&#146; over-allotment option, after the completion
    of this offering, we will
    have&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    outstanding shares of common stock. This number
    includes&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    that we and the selling stockholder are selling in this
    offering, which may be resold immediately in the public market.
    Following the completion of this offering, the selling
    stockholder will
    own&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares,
    or&#160;&#160;&#160;&#160;&#160;% of our total outstanding
    shares, and certain of our affiliates will
    own&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares,&#160;&#160;&#160;&#160;&#160;%
    of our outstanding shares, all of which are restricted from
    immediate resale under the federal securities laws and are
    subject to the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements between such parties and the underwriters described
    in &#147;Underwriters,&#148; but may be sold into the market in
    the future. We expect that the selling stockholder will be a
    party to a registration rights agreement with us which will
    require us to effect the registration of its shares in certain
    circumstances no earlier than 180&#160;days after the date of
    this prospectus. The holders of the
    remaining&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares,
    or&#160;&#160;&#160;&#160;&#160;% of our outstanding shares, are
    not subject to
    <FONT style="white-space: nowrap">lock-up</FONT>
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    agreements and, subject to compliance with Rule&#160;144 under
    the Securities Act, may sell such shares into the public market.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As soon as practicable after this offering, we intend to file a
    registration statement with the SEC on
    <FONT style="white-space: nowrap">Form&#160;S-8</FONT>
    providing for the registration
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock issued or reserved for issuance under our
    stock incentive plan. Subject to the satisfaction of vesting
    conditions and the expiration of
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements, shares registered under this registration statement
    on
    <FONT style="white-space: nowrap">Form&#160;S-8</FONT>
    will be available for resale immediately in the public market
    without restriction.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We cannot predict the size of future issuances of our common
    stock or the effect, if any, that future issuances and sales of
    shares of our common stock will have on the market price of our
    common stock. Sales of substantial amounts of our common stock
    (including shares issued in connection with an acquisition), or
    the perception that such sales could occur, may adversely affect
    prevailing market prices of our common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    certificate of incorporation and bylaws, as well as Delaware
    law, contain provisions that could discourage acquisition bids
    or merger proposals, which may adversely affect the market price
    of our common stock.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation authorizes our board of
    directors to issue preferred stock without stockholder approval.
    If our board of directors elects to issue preferred stock, it
    could be more difficult for a third party to acquire us. In
    addition, some provisions of our certificate of incorporation
    and bylaws could make it more difficult for a third party to
    acquire control of us, even if the change of control would be
    beneficial to our stockholders, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a classified board of directors, so that only approximately
    one-third of our directors are elected each year;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    limitations on the removal of directors;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    limitations on the ability of our stockholders to call special
    meetings and establish advance notice provisions for stockholder
    proposals and nominations for elections to the board of
    directors to be acted upon at meetings of stockholders.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Delaware law prohibits us from engaging in any business
    combination with any &#147;interested stockholder,&#148; meaning
    generally that a stockholder who beneficially owns more than 15%
    of our stock cannot acquire us for a period of three years from
    the date this person became an interested stockholder, unless
    various conditions are met, such as approval of the transaction
    by our board of directors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    concentration of our capital stock ownership among our largest
    stockholders and their affiliates will limit your ability to
    influence corporate matters.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon completion of this offering, we anticipate that OAS Holdco,
    the selling stockholder, will own
    approximately&#160;&#160;&#160;&#160;&#160;% of our outstanding
    common stock and EnCap and its affiliates will
    own&#160;&#160;&#160;&#160;&#160;% of the selling stockholder
    (based on an assumed initial public offering price of
    $&#160;&#160;&#160;&#160; per share). Consequently, EnCap and
    its affiliates will continue to have significant influence over
    all matters that require approval by our stockholders, including
    the election of directors and approval of significant corporate
    transactions. This concentration of ownership will limit your
    ability to influence corporate matters, and as a result, actions
    may be taken that you may not view as beneficial.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Furthermore, conflicts of interest could arise in the future
    between us, on the one hand, and EnCap and its affiliates,
    including its portfolio companies, on the other hand, concerning
    among other things, potential competitive business activities or
    business opportunities. EnCap is a private equity firm in the
    business of making investments in entities primarily in the
    U.S.&#160;oil and gas industry. As a result, EnCap&#146;s
    existing and future portfolio companies which it controls may
    compete with us for investment or business opportunities. These
    conflicts of interest may not be resolved in our favor.
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    will be a &#147;controlled company&#148; within the meaning of
    the NYSE rules and, as a result, will qualify for and will rely
    on exemptions from certain corporate governance
    requirements.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Because OAS Holdco will own a majority of our outstanding common
    stock following the completion of this offering, we will be a
    &#147;controlled company&#148; as that term is set forth in
    Section&#160;303A of the NYSE Listed Company Manual. Under the
    NYSE rules, a company of which more than 50% of the voting power
    is held by another person or group of persons acting together is
    a &#147;controlled company&#148; and may elect not to comply
    with certain NYSE corporate governance requirements, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the requirement that a majority of our board of directors
    consist of independent directors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the requirement that our nominating and corporate governance
    committee be composed entirely of independent directors with a
    written charter addressing the committee&#146;s purpose and
    responsibilities;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the requirement that our compensation committee be composed
    entirely of independent directors with a written charter
    addressing the committee&#146;s purpose and responsibilities.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    These requirements will not apply to us as long as we remain a
    &#147;controlled company.&#148; Following this offering, we may
    utilize some or all of these exemptions. Accordingly, you may
    not have the same protections afforded to stockholders of
    companies that are subject to all of the corporate governance
    requirements of the NYSE. EnCap&#146;s significant ownership
    interest could adversely affect investors&#146; perceptions of
    our corporate governance.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Certain
    federal income tax deductions currently available with respect
    to oil and gas exploration and development may be eliminated as
    a result of future legislation.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On February&#160;1, 2010, the White House released President
    Obama&#146;s budget proposal for the fiscal year 2011, or the
    Budget Proposal. Among the changes recommended in the Budget
    Proposal is the elimination of certain key U.S.&#160;federal
    income tax preferences currently available to coal, oil and gas
    exploration and production companies. These changes include, but
    are not limited to, (i)&#160;the repeal of the percentage
    depletion allowance for oil and gas properties, (ii)&#160;the
    elimination of current deductions for intangible drilling and
    development costs, (iii)&#160;the elimination of the deduction
    for United States production activities, and (iv)&#160;the
    increase in the amortization period from two years to seven
    years for geophysical costs paid or incurred in connection with
    the exploration for, or development of, oil or gas within the
    United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    It is unclear whether any such changes will actually be enacted
    or, if enacted, how soon any such changes could become
    effective. The passage of any legislation as a result of the
    Budget Proposal or any other similar change in U.S.&#160;federal
    income tax law could affect certain tax deductions that are
    currently available with respect to oil and gas exploration and
    production and could negatively impact the value of an
    investment in our shares.
</DIV>
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    <BR>
    32
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='104'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CAUTIONARY
    NOTE&#160;REGARDING FORWARD-LOOKING STATEMENTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This prospectus contains forward-looking statements that are
    subject to a number of risks and uncertainties, many of which
    are beyond our control. All statements, other than statements of
    historical fact included in this prospectus, regarding our
    strategy, future operations, financial position, estimated
    revenues and losses, projected costs, prospects, plans and
    objectives of management are forward-looking statements. When
    used in this prospectus, the words &#147;could,&#148;
    &#147;believe,&#148; &#147;anticipate,&#148; &#147;intend,&#148;
    &#147;estimate,&#148; &#147;expect,&#148; &#147;may,&#148;
    &#147;continue,&#148; &#147;predict,&#148;
    &#147;potential,&#148; &#147;project&#148; and similar
    expressions are intended to identify forward-looking statements,
    although not all forward-looking statements contain such
    identifying words.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Forward-looking statements may include statements about our:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    business strategy;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reserves;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    technology;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    cash flows and liquidity;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    financial strategy, budget, projections and operating results;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    oil and natural gas realized prices;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    timing and amount of future production of oil and natural gas;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    availability of drilling and production equipment;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    availability of oil field labor;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the amount, nature and timing of capital expenditures, including
    future development costs;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    availability and terms of capital;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    drilling of wells;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    competition and government regulations;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    marketing of oil and natural gas;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    exploitation or property acquisitions;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    costs of exploiting and developing our properties and conducting
    other operations;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    general economic conditions;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    competition in the oil and natural gas industry;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    effectiveness of our risk management activities;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    environmental liabilities;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    counterparty credit risk;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    governmental regulation and taxation of the oil and natural gas
    industry;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    developments in oil-producing and natural gas-producing
    countries;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    uncertainty regarding our future operating results;
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    estimated future net reserves and present value thereof;&#160;and
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    plans, objectives, expectations and intentions contained in this
    prospectus that are not historical.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All forward-looking statements speak only as of the date of this
    prospectus. You should not place undue reliance on these
    forward-looking statements. Although we believe that our plans,
    intentions and expectations reflected in or suggested by the
    forward-looking statements we make in this prospectus are
    reasonable, we can give no assurance that these plans,
    intentions or expectations will be achieved. We disclose
    important factors that could cause our actual results to differ
    materially from our expectations under &#147;Risk Factors&#148;
    and &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#148; and elsewhere in this
    prospectus. These cautionary statements qualify all
    forward-looking statements attributable to us or persons acting
    on our behalf.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    33
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='105'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">USE OF
    PROCEEDS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will receive net proceeds of approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million from the sale of
    the common stock offered by us, assuming an initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; per share (the
    midpoint of the price range set forth on the cover page of this
    prospectus) and after deducting estimated expenses and
    underwriting discounts and commissions of approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million. If the
    underwriters&#146; over-allotment option is exercised in full,
    we estimate that our net proceeds will be approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million. We will not
    receive any of the proceeds from the sale of shares of our
    common stock by the selling stockholder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to use a portion of net proceeds from this offering to
    repay all outstanding indebtedness under our revolving credit
    facility. The remaining proceeds of approximately
    $&#160;&#160;&#160;&#160;&#160; million and any proceeds from
    any exercise of the underwriters&#146; option to purchase
    additional common stock from us will be used to fund
    exploration, development and other capital expenditures, as well
    as for general corporate purposes. Our revolving credit facility
    matures in February 2014 and bears interest at a rate of 4.0%
    per annum as of March&#160;1, 2010. Our outstanding borrowings
    under our revolving credit facility were incurred to fund
    exploration, development and other capital expenditures.
    Affiliates of certain of the underwriters are lenders under our
    revolving credit facility and, accordingly, will receive a
    portion of the proceeds from this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We estimate that the selling stockholder will receive net
    proceeds of approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million from the sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    common shares in this offering based upon the assumed initial
    offering price of $&#160;&#160;&#160;&#160;&#160; per share,
    after deducting underwriting discounts. If the
    underwriters&#146; over-allotment option is exercised in full,
    we estimate that the selling stockholder&#146;s net proceeds
    will be approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million. We will pay all
    expenses related to this offering, other than underwriting
    discounts and commissions related to the shares sold by the
    selling stockholder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    An increase or decrease in the initial public offering price of
    $1.00 per share of common stock would cause the net proceeds
    that we will receive from the offering, after deducting
    estimated expenses and underwriting discounts and commissions,
    to increase or decrease by approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    EnCap and certain of its affiliates, as well as certain of our
    executive officers, will indirectly receive proceeds from the
    sale of common stock by the selling stockholder as a result of a
    distribution of proceeds by the selling stockholder to its
    members.
</DIV>

<A name='106'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">DIVIDEND
    POLICY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We do not anticipate declaring or paying any cash dividends to
    holders of our common stock in the foreseeable future. We
    currently intend to retain future earnings, if any, to finance
    the expansion of our business. Our future dividend policy is
    within the discretion of our board of directors and will depend
    upon various factors, including our results of operations,
    financial condition, capital requirements and investment
    opportunities. In addition, our revolving credit facility
    prohibits us from paying cash dividends.
</DIV>
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    <BR>
    34
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='107'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CAPITALIZATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth the capitalization of Oasis
    Petroleum LLC and Oasis Petroleum Inc., as applicable, as of
    December&#160;31, 2009,
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on an actual basis;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on an as adjusted basis to give effect to the transactions
    described under &#147;Corporate Reorganization&#148; that will
    occur simultaneously with the closing of this offering;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on an as further adjusted basis to give effect to this offering
    and the application of the net proceeds as set forth under
    &#147;Use of Proceeds.&#148;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should read the following table in conjunction with
    &#147;Use of Proceeds,&#148; &#147;Selected Historical
    Consolidated and Unaudited Pro Forma Financial Data,&#148;
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#148; and our historical
    consolidated financial statements and unaudited pro forma
    financial information and related notes thereto appearing
    elsewhere in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="65%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As of December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>As Further<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Actual</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As Adjusted</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Adjusted</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Cash and cash equivalents</B>(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    40,562
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    40,562
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 6pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Long-term debt, including current maturities:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Revolving credit facility(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total long-term debt
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Members&#146; / stockholders&#146; equity:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Capital contributions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    235,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Common stock, $0.001&#160;par value; no shares authorized,
    issued and outstanding
    (actual);&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    authorized (as adjusted and as further adjusted); shares issued
    and outstanding (as
    adjusted);&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    issued and outstanding (as further adjusted)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Preferred stock, $0.001&#160;par value; no shares authorized
    (actual); shares authorized (as adjusted and as further
    adjusted); no shares issued and outstanding
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Additional paid-in capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    235,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Retained earnings (accumulated loss)(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (63,150
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (71,150
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total members&#146;/stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    171,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    163,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Total capitalization</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    206,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    198,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    As of March&#160;1, 2010, our cash and cash equivalents were
    $5.1&#160;million.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    On February&#160;26, 2010, we entered into an amended and
    restated revolving credit facility, which will have a borrowing
    base of $70&#160;million upon the completion of this offering.
    Prior to amending and restating our revolving credit facility,
    we repaid substantially all outstanding indebtedness under our
    revolving credit facility with cash on hand. As of March&#160;1,
    2010, we had $13.0&#160;million of indebtedness outstanding
    under our revolving credit facility, which we plan to repay in
    full using a portion of the net proceeds from this offering.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    In connection with our corporate reorganization, an estimated
    net deferred tax liability of approximately $8.0&#160;million
    will be established for differences between the book and tax
    basis of our assets and liabilities and a corresponding expense
    will be recorded to net income from continuing operations.</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    35
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='108'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">DILUTION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Purchasers of the common stock in this offering will experience
    immediate and substantial dilution in the net tangible book
    value per share of the common stock for accounting purposes. Our
    net tangible book value as of December&#160;31, 2009, after
    giving pro forma effect to the transactions described under
    &#147;Corporate Reorganization,&#148; was approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million, or
    $&#160;&#160;&#160;&#160;&#160; per share of common stock. Pro
    forma net tangible book value per share is determined by
    dividing our pro forma tangible net worth (tangible assets less
    total liabilities) by the total number of outstanding shares of
    common stock that will be outstanding immediately prior to the
    closing of this offering. After giving effect to our corporate
    reorganization and the sale of the shares in this offering and
    assuming the receipt of the estimated net proceeds (after
    deducting estimated discounts and expenses of this offering),
    our adjusted pro forma net tangible book value as of
    December&#160;31, 2009 would have been approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million, or
    $&#160;&#160;&#160;&#160;&#160; per share. This represents an
    immediate increase in the net tangible book value of
    $&#160;&#160;&#160;&#160;&#160; per share to our existing
    stockholders and an immediate dilution (i.e., the difference
    between the offering price and the adjusted pro forma net
    tangible book value after this offering) to new investors
    purchasing shares in this offering of
    $&#160;&#160;&#160;&#160;&#160; per share. The following table
    illustrates the per share dilution to new investors purchasing
    shares in this offering:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="92%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Assumed initial public offering price per share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Pro forma net tangible book value per share as of
    December&#160;31, 2009 (after giving effect to our corporate
    reorganization)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Increase per share attributable to new investors in this offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    As adjusted pro forma net tangible book value per share after
    giving effect to our corporate reorganization and this offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Dilution in pro forma net tangible book value per share to new
    investors in this offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes, on an adjusted pro forma basis
    as of December&#160;31, 2009, the total number of shares of
    common stock owned by existing stockholders and to be owned by
    new investors, the total consideration paid, and the average
    price per share paid by our existing stockholders and to be paid
    by new investors in this offering at $ , the midpoint of the
    range of the initial public offering prices set forth on the
    cover page of this prospectus, calculated before deduction of
    estimated underwriting discounts and commissions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="55%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares Acquired</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total Consideration</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Average Price<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Number</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Percent</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Amount</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Percent</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>per Share</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Existing stockholders(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    New investors
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    The number of shares disclosed for the existing stockholders
    includes&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    being sold by the selling stockholder in this offering. The
    number of shares disclosed for the new investors does not
    include
    the&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    being purchased by the new investors from the selling
    stockholder in this offering.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Assuming the underwriters&#146; over-allotment option is
    exercised in full, sales by us in this offering will reduce the
    percentage of shares held by existing stockholders
    to&#160;&#160;&#160;&#160;&#160;% and will increase the number
    of shares held by new investors
    to&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    or&#160;&#160;&#160;&#160;&#160;% on an adjusted pro forma basis
    as of December&#160;31, 2009.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    36
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='109'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SELECTED
    HISTORICAL CONSOLIDATED AND UNAUDITED PRO FORMA FINANCIAL
    DATA</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should read the following selected financial data in
    conjunction with &#147;Corporate Reorganization,&#148;
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#148; and our historical
    consolidated financial statements and unaudited pro forma
    financial information and related notes thereto included
    elsewhere in this prospectus. We believe that the assumptions
    underlying the preparation of our historical consolidated
    financial statements and unaudited pro forma financial data are
    reasonable. The financial information included in this
    prospectus may not be indicative of our future results of
    operations, financial position and cash flows.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Set forth below is our selected historical consolidated
    financial data for the period from February&#160;26, 2007, the
    date of inception of Oasis Petroleum LLC, through
    December&#160;31, 2007, the years ended December&#160;31, 2008
    and 2009 and balance sheet data at December&#160;31, 2008 and
    2009, all of which have been derived from the audited financial
    statements of Oasis Petroleum LLC included elsewhere in this
    prospectus. The balance sheet data at December&#160;31, 2007 has
    been derived from the audited financial statements of Oasis
    Petroleum LLC not included elsewhere in this prospectus. The
    unaudited pro forma financial data for the year ended
    December&#160;31, 2009, which reflects the effects of the
    acquisition of interests in certain oil and gas properties from
    Kerogen Resources, Inc., is derived from the unaudited pro forma
    financial information included elsewhere in this prospectus. The
    unaudited pro forma financial information has been prepared as
    if the acquisition had taken place on January&#160;1, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="49%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Historical</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Pro Forma Year<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="14" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Statement of operations data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil and gas revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,791
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,736
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,755
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    41,999
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Expenses:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Lease operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,946
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,073
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,691
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,274
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,001
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,810
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,160
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,185
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,670
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploration expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,222
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Rig termination(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Impairment of oil and gas properties(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,177
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,117
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gain on sale of properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    General and administrative expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,181
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,452
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,342
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,342
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,864
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    74,551
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,310
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    51,806
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (73
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (39,815
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,555
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,807
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Other income (expense):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Change in unrealized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,679
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14,769
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Realized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,062
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,932
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,776
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,404
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,477
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,424
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,654
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,654
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Net loss</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (13,550
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (34,391
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,461
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    For a discussion of our rig termination expenses, see
    Note&#160;10 to our consolidated financial statements.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    In 2008, we recognized a $45.5&#160;million non-cash impairment
    charge on our proved properties to reflect the impact of
    significantly lower oil prices and a $1.6&#160;million
    impairment charge on our unproved properties due to expiring
    leases. See Note&#160;2 to our consolidated financial statements.</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    37
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="71%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>As of December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Balance sheet data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,282
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,570
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    40,562
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net property, plant and equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,918
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    114,220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    181,573
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    104,145
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    129,068
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    239,553
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Long-term debt
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total members&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36,350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82,459
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    171,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="63%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Other financial data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash provided by operating activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,284
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,766
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash used in investing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (91,988
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (78,478
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (80,756
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash provided by financing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    95,986
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    113,600
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Adjusted EBITDA(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,431
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,269
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,668
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Adjusted EBITDA is a non-GAAP financial measure. For a
    definition of Adjusted EBITDA and a reconciliation of Adjusted
    EBITDA to our net loss and net cash provided by operating
    activities, see &#147;Summary Historical Consolidated and
    Unaudited Pro Forma Financial Data&#160;&#151;
    Non-GAAP&#160;Financial Measure.&#148;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Set forth below is historical financial data for the years ended
    December&#160;31, 2005 and 2006 and the six months ended
    June&#160;30, 2007 for properties acquired from Bill Barrett
    Corporation, which constitute the accounting predecessor to
    Oasis Petroleum LLC. The historical financial data for the years
    ended December&#160;31, 2005 and 2006 was derived from the
    historical accounting records of Bill Barrett Corporation. The
    historical financial data for the six months ended June&#160;30,
    2007 have been derived from the audited statement of revenues
    and direct operating expenses for the properties acquired from
    Bill Barrett Corporation included elsewhere in this prospectus.
    Such statement does not reflect depreciation, depletion and
    amortization, general and administrative expenses, income taxes
    or interest expense.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="63%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Predecessor</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Six Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2005</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2006</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Statement of operations data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil and gas revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    20,494
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    25,207
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Direct operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,283
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,872
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,490
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Excess of revenues over direct operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    16,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    19,335
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,196
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    38
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='110'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MANAGEMENT&#146;S
    DISCUSSION AND ANALYSIS OF<BR>
    FINANCIAL CONDITION AND RESULTS OF OPERATIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>The following discussion and analysis of our financial
    condition and results of operations should be read in
    conjunction with our consolidated financial statements and
    related notes appearing elsewhere in this prospectus. The
    following discussion contains &#147;forward-looking
    statements&#148; that reflect our future plans, estimates,
    beliefs and expected performance. We caution that assumptions,
    expectations, projections, intentions, or beliefs about future
    events may, and often do, vary from actual results and the
    differences can be material. Some of the key factors which could
    cause actual results to vary from our expectations include
    changes in oil and natural gas prices, the timing of planned
    capital expenditures, availability of acquisitions,
    uncertainties in estimating proved reserves and forecasting
    production results, operational factors affecting the
    commencement or maintenance of producing wells, the condition of
    the capital markets generally, as well as our ability to access
    them, the proximity to and capacity of transportation
    facilities, and uncertainties regarding environmental
    regulations or litigation and other legal or regulatory
    developments affecting our business, as well as those factors
    discussed below and elsewhere in the prospectus, all of which
    are difficult to predict. In light of these risks, uncertainties
    and assumptions, the forward-looking events discussed may not
    occur. See &#147;Cautionary Note Regarding Forward-Looking
    Statements.&#148;</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are an independent exploration and production company focused
    on the acquisition and development of unconventional oil and
    natural gas resources primarily in the Williston Basin. Since
    our inception, we have emphasized the acquisition of properties
    that provided current production and significant upside
    potential through further development. Our drilling activity is
    primarily directed toward projects that we believe can provide
    us with repeatable successes in the Bakken formation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our use of capital for acquisitions and development allows us to
    direct our capital resources to what we believe to be the most
    attractive opportunities as market conditions evolve. We have
    historically acquired properties that we believe will meet or
    exceed our rate of return criteria. For acquisitions of
    properties with additional development, exploitation and
    exploration potential, we have focused on acquiring properties
    that we expect to operate so that we can control the timing and
    implementation of capital spending. In some instances, we have
    acquired non-operated property interests at what we believe to
    be attractive rates of return either because they provided a
    foothold in a new area of interest or complemented our existing
    operations. We intend to continue to acquire both operated and
    non-operated properties to the extent we believe they meet our
    return objectives. In addition, our willingness to acquire
    non-operated properties in new areas provides us with
    geophysical and geologic data that may lead to further
    acquisitions in the same area, whether on an operated or
    non-operated basis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our company was formed in February 2007. We began active oil and
    natural gas operations in July 2007 following the acquisition of
    properties in the Williston Basin consisting of approximately
    175,000&#160;net leasehold acres and approximately 1,000 Boe/d
    of then-current net production, substantially forming our core
    leasehold position in the West Williston project area. In May
    2008, we entered into a farm-in and purchase arrangement under
    which we earned or acquired approximately 48,000&#160;net
    leasehold acres, establishing our initial position in the East
    Nesson project area. In June 2009, we acquired approximately
    40,000&#160;net leasehold acres with then-current net production
    of approximately 800 Boe/d, approximately 83% of which was from
    the Williston Basin. This acquisition consolidated our acreage
    in the East Nesson project area and established our Sanish
    project area. In September 2009, we acquired an additional
    46,000&#160;net leasehold acres with then-current production of
    approximately 300 Boe/d. This acquisition further consolidated
    our acreage in the East Nesson project area. Our acquisitions
    were financed with a combination of borrowings under our
    revolving credit
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    39
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    facility, cash flows provided by operating activities and
    capital contributions made by EnCap and other private investors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="36%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Adjusted<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Production at<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Closing Date of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Purchase Price(1)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Acquisition<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Net Acreage at<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Project Areas of Acquired Properties</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Acquisition</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(In millions)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(Boe/d)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Acquisition</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    West Williston(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    June 22, 2007
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    83
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    175,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    East Nesson(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    May 16, 2008
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    48,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    East Nesson/Sanish
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    June 15, 2009
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    800
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    East Nesson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="bottom">
    September 30, 2009
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    300
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents initial purchase price plus closing adjustments.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    For accounting purposes, results from our West Williston
    acquisition are included in our results of operations effective
    July&#160;1, 2007.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Our farm-in and purchase arrangement required an initial payment
    of $15.6&#160;million and obligated us to spend
    $15.1&#160;million of drilling costs on behalf of the other
    parties.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Because of our substantial recent acquisition activity, our
    discussion and analysis of our historical financial condition
    and results of operations for the periods discussed below may
    not necessarily be comparable with or applicable to our future
    results of operations. Our initial acquisition of properties in
    the Williston Basin was completed in June 2007 from Bill Barrett
    Corporation, which constitutes our accounting predecessor. Our
    historical results include the results from our recent
    acquisitions beginning on the closing dates indicated in the
    table above. See our unaudited pro forma financial information
    and related notes included elsewhere in this prospectus for more
    information about how our historical results of operations would
    have been affected had our June 2009 acquisition been completed
    on January&#160;1, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our 2009 activities included development and exploration
    drilling in each of our primary project areas. Our current
    activities are focused on evaluating and developing our asset
    base, optimizing our acreage positions and evaluating potential
    acquisitions. At December&#160;31, 2009, based on the reserve
    report prepared by our independent reserve engineers, we had
    13.3&#160;MMBoe of estimated net proved reserves with a
    <FONT style="white-space: nowrap">PV-10</FONT> of
    $133.5&#160;million and a Standardized Measure of
    $133.5&#160;million. At December&#160;31, 2008, we had
    2.3&#160;MMBoe of estimated net proved reserves with a
    <FONT style="white-space: nowrap">PV-10</FONT> of
    $17.7&#160;million and a Standardized Measure of
    $17.7&#160;million. Our estimated proved reserves and related
    future net revenues, PV-10 and Standardized Measure were
    determined using index prices for oil and natural gas, without
    giving effect to derivative transactions, and were held constant
    throughout the life of the properties. The unweighted arithmetic
    average first-day-of-the-month prices for the prior 12 months
    were $61.04/Bbl for oil and $3.87/MMBtu for natural gas at
    December 31, 2009, and the index prices were $44.60/Bbl for oil
    and $5.63/MMBtu for natural gas at December 31, 2008. These
    prices were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our revenue, profitability and future growth rate depend
    substantially on factors beyond our control, such as economic,
    political and regulatory developments as well as competition
    from other sources of energy. Oil and natural gas prices
    historically have been volatile and may fluctuate widely in the
    future. Sustained periods of low prices for oil or natural gas
    could materially and adversely affect our financial position,
    our results of operations, the quantities of oil and natural gas
    reserves that we can economically produce and our access to
    capital.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Sources
    of our revenue</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our revenues are derived from the sale of oil and natural gas
    production and do not include the effects of derivatives. Our
    revenues may vary significantly from period to period as a
    result of changes in volumes of production sold or changes in
    commodity prices.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    40
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes our revenues and production data
    for the periods indicated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="44%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterright -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="17%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Predecessor</B>
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Oasis Petroleum LLC</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>January&#160;1, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30, 2007(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Operating results (in thousands):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Oil
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,335
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    33,396
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    36,376
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Natural gas
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    475
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    456
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,340
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,379
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Total oil and gas revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,791
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,736
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,755
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Production data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Oil (MBbls)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    190
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    379
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    658
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Natural gas (MMcf)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    73
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    123
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    326
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Oil equivalents (MBoe)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    202
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    171
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    400
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    712
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Average daily production (Boe/d)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,092
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,950
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Average sales prices:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Oil, without realized derivatives (per Bbl)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    53.73
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    83.96
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    88.07
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    55.32
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Oil, with realized derivatives (3) (per Bbl)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    77.27
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69.79
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    58.82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Natural gas (per Mcf)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6.87
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10.91
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.24
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    The historical financial data for the six months ended
    June&#160;30, 2007 have been derived from the audited statement
    of revenues and direct operating expenses for the properties
    acquired from Bill Barrett Corporation included elsewhere in
    this prospectus.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    For the period from February&#160;26, 2007 through June&#160;30,
    2007, we did not engage in oil and gas operating or producing
    activities. Average daily production includes production from
    July&#160;1, 2007 through December&#160;31, 2007.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Realized prices include realized gains or losses on cash
    settlements for commodity derivatives, which do not qualify for
    hedge accounting. We have not made any estimates of the impact
    of commodities derivatives on the average sales price for our
    predecessor.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Year
    ended December&#160;31, 2009 as compared to year ended
    December&#160;31, 2008</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Oil and Natural Gas Revenues.</I>&#160;&#160;Our oil and
    natural gas sales revenues increased $3.0&#160;million, or 9%,
    to $37.8&#160;million during the year ended December&#160;31,
    2009 as compared to the year ended December&#160;31, 2008. Our
    revenues are a function of oil and natural gas production
    volumes sold and average sales prices received for those
    volumes. Average daily production sold increased by 858&#160;Boe
    per day or 79% to 1,950&#160;Boe per day during the year ended
    December&#160;31, 2009 as compared to the year ended
    December&#160;31, 2008. The increase in average daily production
    sold is primarily due to the East Nesson and Sanish acquisitions
    completed in 2009 and well completions in our East Nesson
    project area. This $16.2&#160;million revenue increase
    attributable to higher production sold was almost entirely
    offset by a $13.2&#160;million revenue reduction attributable to
    lower oil sales prices during the year ended December&#160;31,
    2009. Average oil sales prices, without realized derivatives,
    declined by $32.75 per barrel or 37% to an average of $55.32 per
    barrel for the year ended December&#160;31, 2009 as compared to
    the year ended December&#160;31, 2008.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    41
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Year
    ended December&#160;31, 2008 as compared to period from
    February&#160;26, 2007 (Inception) through December&#160;31,
    2007</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Oil and Natural Gas Revenues.</I>&#160;&#160;Our oil and
    natural gas sales revenues increased $20.9&#160;million, or
    152%, to $34.7&#160;million for the year ended December&#160;31,
    2008 compared to the period from February&#160;26, 2007
    (inception) through December&#160;31, 2007. This increase was
    primarily a result of production from properties acquired in our
    West Williston project area, which we owned for all of 2008 as
    compared to only the last six months in 2007. Average oil sales
    prices, without realized derivatives, increased by $4.11 per
    barrel or 5% to an average of $88.07 per barrel for the year
    ended December&#160;31, 2008 as compared to the period ended
    December&#160;31, 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    When comparing our revenue for the period from February&#160;26,
    2007 (inception) through December&#160;31, 2007 to our
    predecessor&#146;s revenues for the period from January 1
    through June&#160;30, 2007, our revenues increased by
    $3.1&#160;million or 29% to $13.8&#160;million. The revenue
    increase is primarily due to average oil sales prices, without
    realized derivatives, that increased by $30.23 per barrel or 56%
    to an average of $83.96 per barrel.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Expenses</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Lease operating expenses.</I>&#160;&#160;Lease operating
    expenses are daily costs incurred to bring oil and natural gas
    out of the ground and to the market, together with the daily
    costs incurred to maintain our producing properties. Such costs
    also include field personnel compensation, utilities,
    maintenance, repairs and workover expenses related to our oil
    and natural gas properties.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Production taxes.</I>&#160;&#160;Production taxes are paid on
    produced oil and natural gas based on a percentage of revenues
    from products sold at market prices (not hedged prices) or at
    fixed rates established by federal, state or local taxing
    authorities. We take full advantage of all credits and
    exemptions in our various taxing jurisdictions. In general, the
    production taxes we pay correlate to the changes in oil and
    natural gas revenues.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Depreciation, depletion and
    amortization.</I>&#160;&#160;Depreciation, depletion and
    amortization includes the systematic expensing of the
    capitalized costs incurred to acquire, explore and develop oil
    and natural gas. As a successful efforts company, we capitalize
    all costs associated with our acquisition and development
    efforts and all successful exploration efforts, and allocate
    these costs to each unit of production using the
    <FONT style="white-space: nowrap">units-of-production</FONT>
    method.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Exploration expenses.</I>&#160;&#160;Exploration expenses
    consist of exploratory dry hole expenses and costs incurred in
    evaluating areas that are considered to have prospective oil and
    natural gas reserves, including costs for topographical,
    geological and geophysical studies, rights of access to
    properties and costs of carrying and retaining undeveloped
    properties, such as delay rentals.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Impairment of unproved and proved
    properties.</I>&#160;&#160;These costs include unproved property
    impairment and costs associated with lease expirations. We could
    also record impairment charges for proved properties if the
    carrying value exceeds estimated future cash flows. See
    &#147;&#151;&#160;Impairment of proved properties.&#148;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>General and administrative expenses.</I>&#160;&#160;General
    and administrative expenses include overhead, including payroll
    and benefits for our corporate staff, costs of maintaining our
    headquarters, costs of managing our production and development
    operations, franchise taxes, audit and other professional fees
    and legal compliance.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Other
    Income (Expense)</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Change in unrealized gain (loss) on derivative
    instruments.</I>&#160;&#160;We utilize commodity derivative
    financial instruments to reduce our exposure to fluctuations in
    the price of crude oil and natural gas. This account activity
    represents the recognition of gains and losses associated with
    our open derivative contracts as commodity prices and commodity
    derivative contracts change.
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    42
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Realized gain (loss) on derivative instruments,
    net.</I>&#160;&#160;We utilize commodity derivative instruments
    to reduce our exposure to fluctuations in the price of crude oil
    and natural gas. The account activity represents our realized
    gains and losses on the settlement of these commodity derivative
    instruments.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Interest expense.</I>&#160;&#160;We finance a portion of our
    working capital requirements, capital expenditures and
    acquisitions with borrowings under our revolving credit
    facility. As a result, we incur interest expense that is
    affected by both fluctuations in interest rates and our
    financing decisions. We reflect interest paid to the lenders
    under our revolving credit facility in interest expense. In
    addition, we include the amortization of deferred financing
    costs (including origination and amendment fees), commitment
    fees and annual agency fees as interest expense.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Income tax expense.</I>&#160;&#160;As of December&#160;31,
    2009, we were a limited liability company not subject to entity
    level income tax. Accordingly, no provision for federal or state
    corporate income taxes has been provided for the year ended
    December&#160;31, 2009 or prior years because taxable income is
    allocated directly to our equity holders. In connection with the
    closing of this offering, we will merge into a corporation that
    will be subject to federal and state entity-level taxation. In
    connection with our corporate reorganization, a net deferred tax
    liability will be established for differences between the tax
    and book basis of our assets and liabilities and a corresponding
    expense will be recorded to net income from continuing
    operations. We estimate the net deferred tax liability to be
    approximately $8.0&#160;million. No tax benefit will be recorded
    for cumulative book losses generated while we were a limited
    liability company. We do not expect to be in a tax paying
    position for regular federal income taxes for the year ended
    December&#160;31, 2010, primarily due to the current
    deductibility of intangible drilling costs, or IDC. We do expect
    to incur state income or franchise taxes in jurisdictions in
    which our IDC deductions do not exceed our taxable income or
    where state income or franchise taxes are determined on another
    basis.
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    43
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes our operating expenses for the
    periods indicated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="47%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterright -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="15%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Oasis Petroleum LLC</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Predecessor</B>
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>January&#160;1, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30, 2007(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" nowrap align="center" valign="bottom">
    <B>(In thousands, except production cost and expense (per Boe of
    production))</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Expenses:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Lease operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,583
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,946
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,073
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8,691
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Production taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    907
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,001
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,810
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,185
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,670
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Exploration expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,222
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Rig termination
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Impairment of oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,177
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,117
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Gain on sale of properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    General and administrative expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,181
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,452
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,342
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,864
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    74,551
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    47,310
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (73
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (39,815
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,555
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Other income (expense):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Change in unrealized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,679
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14,769
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Realized gain (loss) on derivative instruments, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,062
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,932
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,776
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,404
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,477
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,424
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,654
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Net loss</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (13,550
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (34,391
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Cost and expense (per Boe of production):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Lease operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12.79
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.23
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.70
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12.21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Production taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.49
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.08
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.51
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.35
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24.47
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21.73
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23.42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    General and administrative expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18.60
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.64
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.12
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    The historical financial data for the six months ended
    June&#160;30, 2007 have been derived from the audited statement
    of revenues and direct operating expenses for the properties
    acquired from Bill Barrett Corporation included elsewhere in
    this prospectus. Such statement does not reflect depreciation,
    depletion and amortization, general and administrative expenses,
    income taxes or interest expense.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    For the period from February&#160;26, 2007 through June&#160;30,
    2007, we did not engage in oil and gas operating or producing
    activities. Average daily production includes production from
    July&#160;1, 2007 through December&#160;31, 2007.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Year
    ended December&#160;31, 2009 compared to year ended
    December&#160;31, 2008</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Lease Operating Expenses.</I>&#160;&#160;Lease operating
    expenses increased $1.6&#160;million for the year ended
    December&#160;31, 2009 compared to the year ended
    December&#160;31, 2008. This increase was primarily due to the
    higher number of productive wells from our East Nesson and
    Sanish acquisitions that were completed in 2009. The 73%
    increase in oil volumes from 2008 to 2009 resulted in a 31%
    decrease in unit operating costs to $12.21 per Boe. The
    2008&#160;unit operating costs were also higher on a per barrel
    basis due to increased equipment repair and salt water disposal
    costs for the properties in our West Williston project area.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Production Taxes.</I>&#160;&#160;Our production taxes for the
    years ended December&#160;31, 2009 and 2008 were 10.1% and 8.6%,
    respectively, as a percentage of oil and natural gas sales. The
    2009 production tax rate was higher than the 2008 production tax
    rate due to the increased weighting of revenues in North Dakota
    which imposes
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    an 11.5% production tax rate. The 2008 production taxes were
    primarily for oil and natural gas sales revenue associated with
    the properties in our West Williston project area acquired in
    2007. A portion of the properties in our West Williston project
    area generate revenues that are subject to lower Montana
    production tax rates and certain North Dakota exemptions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Depreciation, Depletion and Amortization
    (DD&#038;A).</I>&#160;&#160;Depreciation, depletion and
    amortization expense increased $8.0&#160;million for the year
    ended December&#160;31, 2009 compared to the year ended
    December&#160;31, 2008. The 2009 expense increase is primarily
    due to a 73% production increase from the 2009 East Nesson and
    Sanish acquisitions. The 2009 DD&#038;A rate was $23.42 per Boe
    compared to $21.73 per Boe in 2008. The increase from 2008 to
    2009 was due to higher acquisition, leasehold, drilling and
    completion costs in the East Nesson and Sanish project areas.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Exploration Expenses.</I>&#160;&#160;Exploration expenses of
    $1.0&#160;million in the year ended December&#160;31, 2009 were
    primarily composed of exploratory geological and geophysical
    costs. The comparable period in 2008 contained exploratory dry
    hole costs of $1.3&#160;million and higher expenditures for
    exploratory geological and geophysical costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Rig Termination.</I>&#160;&#160;During 2008, we entered into
    drilling rig contracts with two drilling contractors. In the
    fourth quarter of 2008, we reduced our planned 2009 capital
    expenditure program and entered into discussions regarding early
    termination of these contracts. In the first quarter of 2009, we
    paid a total of $3.0&#160;million in rig termination expenses in
    connection with the termination of our remaining commitment
    under one drilling rig contract and the extension of the other
    drilling rig contract until June 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In November 2009, we entered into a new six-month drilling rig
    contract which replaced the contract we had previously extended.
    In the event of an early termination under this new drilling rig
    contract, we are obligated to pay a daily shortfall rate of
    $9,000 per day for the days remaining between the date of
    termination and May&#160;15, 2010, the end of the primary
    contract term.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Impairment of Oil and Gas Properties.</I>&#160;&#160;During
    the years ended December&#160;31, 2009 and 2008, we recorded
    $0.8&#160;million and $45.5&#160;million, respectively, in
    non-cash impairment charges on our proved oil and gas
    properties. The 2008 charges reflected the impact of
    significantly lower oil prices reflected in our 2008 reserve
    report.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the years ended December&#160;31, 2009 and 2008, we
    recorded non-cash impairment charges of $5.4&#160;million and
    $1.6&#160;million, respectively, for unproved property leases
    that expired during the period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Gain on Sale of Properties.</I>&#160;&#160;In December 2009,
    we sold our interests in non-core oil and natural gas producing
    properties located in the Barnett shale in Texas for
    $1.5&#160;million. We recognized a gain of $1.4&#160;million
    from the sale of these divested properties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>General and Administrative.</I>&#160;&#160;Our general and
    administrative expenses increased to $9.3&#160;million for the
    year ended December&#160;31, 2009 from $5.5&#160;million for the
    year ended December&#160;31, 2008. This increase was primarily
    due to higher costs related to employee bonus compensation,
    additional employees and higher advisory, audit, legal and tax
    fees related to our initial public offering. As of
    December&#160;31, 2009, we had 27&#160;full-time employees
    compared to 20&#160;employees as of December&#160;31, 2008. On a
    per unit basis, general and administrative expenses were $13.12
    per Boe compared to $13.64 per Boe for the years ended
    December&#160;31, 2009 and 2008, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Derivatives.</I>&#160;&#160;As a result of our derivative
    activities, we incurred cash settlement gains of
    $2.3&#160;million for the year ended December&#160;31, 2009 and
    cash settlement losses of $6.9&#160;million for the year ended
    December&#160;31, 2008. In addition, as a result of forward oil
    price changes, we recognized $7.0&#160;million of unrealized
    <FONT style="white-space: nowrap">mark-to-market</FONT>
    non-cash derivative losses in 2009 and $14.8&#160;million of
    unrealized
    <FONT style="white-space: nowrap">mark-to-market</FONT>
    non-cash derivative gains during 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Interest Expense.</I>&#160;&#160;Interest expense decreased
    $1.5&#160;million, or 62%, for the year ended December&#160;31,
    2009 compared to the year ended December&#160;31, 2008, due to a
    lower weighted average outstanding debt balance and a lower
    weighted average interest rate during 2009. Our weighted average
    debt balance decreased to $22.8&#160;million for the year ended
    December&#160;31, 2009 compared to $37.7&#160;million for the
    year ended
</DIV>
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    45
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    December&#160;31, 2008. The weighted average interest rate on
    our revolving credit facility borrowings was 3.5% for the year
    ended December&#160;31, 2009 compared to 6.3% for the same
    period in 2008. At December&#160;31, 2009 our outstanding debt
    balance under our revolving credit facility was
    $35.0&#160;million with a weighted average interest rate of
    2.95%.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Year
    ended December&#160;31, 2008 compared to period from
    February&#160;26, 2007 (Inception) through December&#160;31,
    2007</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Lease Operating Expenses.</I>&#160;&#160;Lease operating
    expenses increased $4.1&#160;million for the year ended
    December&#160;31, 2008 compared to the period from
    February&#160;26, 2007 to December&#160;31, 2007. The West
    Williston oil and natural gas producing properties were
    purchased in June 2007 and are reflected in only six months of
    our 2007 operating results as compared to a full twelve months
    in 2008. Lease operating expenses were $17.70 and
    $17.23&#160;per Boe for the year ended December&#160;31, 2008
    and for the period from February&#160;26, 2007 (inception)
    through December&#160;31, 2007, respectively. The unit operating
    costs for the year ended December&#160;31, 2008 were higher on a
    Boe unit basis due to increased equipment repair and salt water
    disposal costs for our West Williston properties. When comparing
    our lease operating expenses for the period from
    February&#160;26, 2007 (inception) through December&#160;31,
    2007 to our predecessor&#146;s lease operating expenses from
    January&#160;1 through June&#160;30, 2007, our lease operating
    expenses increased by $0.4&#160;million or 14% to
    $2.9&#160;million. The lease operating expense increase is
    primarily due to the increase in oil and gas operating and
    producing activities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Production Taxes.</I>&#160;&#160;Our production taxes for the
    year ended December&#160;31, 2008, the period from
    February&#160;26, 2007 (inception) through December&#160;31,
    2007 and our predecessor&#146;s production taxes for the period
    from January&#160;1 through June&#160;30, 2007 were 8.6%, 8.8%
    and 8.5% respectively, of oil and natural gas sales for our West
    Williston oil and gas producing properties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Depreciation, Depletion and
    Amortization.</I>&#160;&#160;Depreciation, depletion and
    amortization expense increased $4.5&#160;million for the year
    ended December&#160;31, 2008 compared to the period from
    February&#160;26, 2007 to December&#160;31, 2007. The West
    Williston oil and gas producing properties were purchased in
    June 2007 and are reflected in only six months of our 2007
    operating results as compared to a full twelve months in 2008.
    The depreciation, depletion and amortization rate was $21.73 per
    Boe for the year ended December&#160;31, 2008 as compared to
    $24.47&#160;per Boe in the period from February&#160;26, 2007
    (inception) through December&#160;31, 2007. This increase was
    due to higher drilling and completion costs in the year ended
    December&#160;31, 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Exploration Expenses.</I>&#160;&#160;Exploration expenses of
    $3.2&#160;million in the year ended December&#160;31, 2008
    included $1.3&#160;million of dry hole costs with the remaining
    geological and geophysical costs comparable to those incurred
    from February&#160;26, 2007 to December&#160;31, 2007. For the
    period ended December&#160;31, 2007, we did not incur any dry
    hole costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Impairment of Oil and Gas Properties.</I>&#160;&#160;During
    the year ended December&#160;31, 2008, we recorded a non-cash
    impairment charge of $45.5&#160;million on our proved oil and
    gas properties as a result of lower crude oil prices at
    December&#160;31, 2008, without a comparable charge for the
    period ended December&#160;31, 2007. During the year ended
    December&#160;31, 2008 and the period from February&#160;26,
    2007 to December&#160;31, 2007, we recorded non-cash impairment
    charges of $1.6&#160;million and $1.2&#160;million,
    respectively, for unproved property leases that expired during
    the period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>General and Administrative.</I>&#160;&#160;General and
    administrative expenses increased to $5.5&#160;million for the
    year ended December&#160;31, 2008 from $3.2&#160;million during
    the period from February&#160;26, 2007 through December&#160;31,
    2007. This increase was due both to a full 12&#160;months of
    operations in 2008 as well as to the
    <FONT style="white-space: nowrap">start-up</FONT>
    nature of our activities in the 2007 period. General and
    administrative expenses were $13.64&#160;per Boe for the year
    ended December&#160;31, 2008 compared to $18.60 per Boe for the
    period ended 2007. The improvement was due to a full year of
    production volumes in the 2008 period versus only six months of
    volumes in the 2007 period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Derivatives.</I>&#160;&#160;In connection with the West
    Williston acquisition in June 2007, we entered into fixed-price
    swap and collar contracts. As a result, only five contract
    settlement periods occurred during the period from
    February&#160;26, 2007 through December&#160;31, 2007 as
    compared to twelve contract settlement periods for the year
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    ended December&#160;31, 2008. We incurred cash settlement losses
    of $6.9&#160;million and $1.1&#160;million during the year ended
    December&#160;31, 2008 and the period from February&#160;26,
    2007 to December&#160;31, 2007, respectively, on contract
    settlements of our crude oil derivative transactions. In
    addition, we recognized $14.8&#160;million of unrealized
    <FONT style="white-space: nowrap">mark-to-market</FONT>
    non-cash derivative gains during the year ended
    December&#160;31, 2008 as compared to $10.7&#160;million of
    unrealized
    <FONT style="white-space: nowrap">mark-to-market</FONT>
    non-cash derivative losses during the period from
    February&#160;26, 2007 through December&#160;31, 2007 due to
    increases in forward oil prices during the 2008 period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Interest Expense.</I>&#160;&#160;Interest expense increased
    $0.6&#160;million, or 35%, for the year ended December&#160;31,
    2008 compared to the period from February 26 through
    December&#160;31, 2007, primarily due to our revolving credit
    facility borrowings being outstanding for a full 12&#160;months
    in the 2008 period. The weighted average outstanding debt
    balance and weighted average interest rates were
    $37.7&#160;million and 6.3% during for the year ended
    December&#160;31, 2008. The weighted average outstanding debt
    balance and weighted average interest rates were
    $22.8&#160;million and 7.81% during the period from February 26
    through December&#160;31, 2007.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Liquidity
    and Capital Resources</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our primary sources of liquidity to date have been capital
    contributions from EnCap and other private investors, borrowings
    under our revolving credit facility and cash flows from
    operations. Our primary use of capital has been for the
    acquisition, development and exploration of oil and natural gas
    properties. We continually monitor potential capital sources,
    including equity and debt financings, in order to meet our
    planned capital expenditures and liquidity requirements. Our
    future success in growing proved reserves and production will be
    highly dependent on our ability to access outside sources of
    capital.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our total 2010 capital expenditure budget is $220&#160;million,
    which consists&#160;of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $134&#160;million for drilling and completing operated wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $45&#160;million for drilling and completing non-operated wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $15&#160;million for maintaining and expanding our leasehold
    position;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $5&#160;million for constructing infrastructure to support
    production in our core project areas;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $21&#160;million in unallocated funds which are available for
    additional drilling and leasing costs and activity.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    While we have budgeted $220&#160;million for these purposes, the
    ultimate amount of capital we will expend may fluctuate
    materially based on market conditions and the success of our
    drilling results as the year progresses. To date, our 2010
    capital budget has been funded from a $35&#160;million capital
    contribution from our equity investors in December 2009 and
    borrowings under our revolving credit facility. We believe the
    net proceeds from this offering together with cash flows from
    operations and additional borrowings under our revolving credit
    facility should be more than sufficient to fund the remainder of
    our 2010 and a portion of our 2011 capital expenditure budget.
    However, because the operated wells funded by our 2010 drilling
    plan represent only a small percentage of our gross identified
    operated drilling locations, we will be required to generate or
    raise multiples of this amount of capital to develop our entire
    inventory of identified drilling locations should we elect to
    do&#160;so.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On February&#160;26, 2010, we entered into an amended and
    restated revolving credit facility, which will have a borrowing
    base of $70&#160;million upon the completion of this offering.
    As of March&#160;1, 2010 we had $13.0&#160;million of
    indebtedness outstanding and $57.0&#160;million of borrowing
    capacity available under the conforming borrowing base
    commitment of our revolving credit facility. For more
    information regarding our revolving credit facility, see
    &#147;&#151;&#160;Reserve-based credit facility.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect that in the future our commodity derivative positions
    will help us stabilize a portion of our expected cash flows from
    operations despite potential declines in the price of oil and
    natural gas. Please see &#147;&#151;&#160;Quantitative and
    Qualitative Disclosures About Market Risk.&#148;
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    47
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We actively review acquisition opportunities on an ongoing
    basis. Our ability to make significant additional acquisitions
    for cash would require us to obtain additional equity or debt
    financing, which we may not be able to obtain on terms
    acceptable to us or at all.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our cash flows for the period from February&#160;26, 2007
    through December&#160;31, 2007 and the years ended
    December&#160;31, 2008 and 2009, respectively, are presented
    below (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="60%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash provided by operating activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,284
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,766
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash used in investing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (91,988
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (78,478
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (80,756
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net cash provided by financing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    95,986
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    113,600
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net change in cash
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,282
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (4,712
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    38,992
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Cash
    flows provided by operating activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Net cash provided by operating activities was $2.3&#160;million
    for the period from February&#160;26, 2007 through
    December&#160;31, 2007, and $13.8&#160;million and
    $6.1&#160;million for the years ended December&#160;31, 2008 and
    2009, respectively. The increase in cash flows from operations
    for the year ended December&#160;31, 2008 compared to period
    ended December&#160;31, 2007 was primarily the result of an
    increase in oil and natural gas production. Cash flows from
    operations during the year ended December&#160;31, 2009
    decreased compared to 2008 primarily as a result of a
    $3.0&#160;million rig termination payment and $3.9&#160;million
    increase in general and administration expenses related to the
    initial public offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our operating cash flows are sensitive to a number of variables,
    the most significant of which is the volatility of oil and gas
    prices. Regional and worldwide economic activity, weather,
    infrastructure capacity to reach markets and other variable
    factors significantly impact the prices of these commodities.
    These factors are beyond our control and are difficult to
    predict. For additional information on the impact of changing
    prices on our financial position, see
    &#147;&#151;&#160;Quantitative and Qualitative Disclosures About
    Market Risk&#148; below.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Cash
    flows used in investing activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We had cash flows used in investing activities of
    $92.0&#160;million during the period from February&#160;26, 2007
    through December&#160;31, 2007 and we had $78.5&#160;million and
    $80.8&#160;million during the years ended December&#160;31, 2008
    and 2009, respectively, as a result of our capital expenditures
    for drilling, development and acquisition costs. The decrease in
    cash flows used in investing activities during the year ended
    December&#160;31, 2008 compared to the period ended
    December&#160;31, 2007 was attributable to the completion of the
    acquisition of the West Williston assets in 2007. The increase
    in cash used in investing activities for the year ended
    December&#160;31, 2009 compared to 2008 of $2.3&#160;million was
    attributable to our acquisitions of properties in the East
    Nesson and Sanish project areas, as well as increased levels of
    expenditures for the development of our properties.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    48
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our capital expenditures for drilling, development and
    acquisition costs for the period from February&#160;26, 2007 to
    December&#160;31, 2007 and the years ended December&#160;31,
    2008 and 2009 are summarized in the following table (in
    thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="62%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Project Area:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    West Williston
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    95,109
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,703
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    15,521
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    East Nesson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    66,513
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40,208
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Sanish
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,952
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    582
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    95,109
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    79,216
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    89,263
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents data relating to our properties in the Barnett shale.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Consolidated capital expenditures reflected in the table above
    differ from the amounts shown in the statement of cash flows in
    our financial statements because amounts reflected in the table
    include changes in accounts payable from the previous reporting
    period for capital expenditures, while the amounts presented in
    the statement of cash flows are presented on a cash basis.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors has approved a total capital expenditure
    budget of $220&#160;million for 2010, which is a 147% increase
    over the $89&#160;million invested during 2009. Our capital
    budget may be adjusted as business conditions warrant. The
    amount, timing and allocation of capital expenditures is largely
    discretionary and within our control. If oil and natural gas
    prices decline or costs increase significantly, we could defer a
    significant portion of our budgeted capital expenditures until
    later periods to prioritize capital projects that we believe
    have the highest expected returns and potential to generate
    near-term cash flows. We routinely monitor and adjust our
    capital expenditures in response to changes in prices,
    availability of financing, drilling and acquisition costs,
    industry conditions, the timing of regulatory approvals, the
    availability of rigs, success or lack of success in drilling
    activities, contractual obligations, internally generated cash
    flows and other factors both within and outside our control.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Expenditures for exploration and development of oil and natural
    gas properties are the primary use of our capital resources. We
    anticipate investing $220&#160;million for capital and
    exploration expenditures in 2010 as follows (in millions):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="92%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Amount</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploration and development drilling
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Land costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Infrastructure
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Unallocated funds available for additional drilling and leasing
    costs and activity.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Cash
    flows provided by financing activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Net cash provided by financing activities was $96.0&#160;million
    for period from February&#160;26, 2007 through December&#160;31,
    2007, and $60.0&#160;million and $113.6&#160;million for the
    years ended December&#160;31, 2008 and 2009, respectively. For
    the period from February&#160;26, 2007 through December&#160;31,
    2007 and the years ended December&#160;31, 2008 and 2009, cash
    sourced through financing activities was primarily provided by
    capital contributions from EnCap and other private investors and
    borrowings under our revolving credit facility. Our long-term
    debt, including the current portion, was $46.5&#160;million,
    $26.0&#160;million and $35.0&#160;million at December&#160;31,
    2007, 2008 and 2009, respectively.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    49
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In March 2007, we entered into a limited liability company
    agreement that provided for an aggregate of $100&#160;million in
    capital contribution commitments from EnCap, its affiliates and
    other investors, including certain members of management and
    other employees through Oasis Petroleum Management LLC. The
    original capital contribution commitment period extended from
    March 2007 until March 2010. In November 2007, the agreement was
    amended to increase the aggregate capital contribution
    commitment from $100&#160;million to $200&#160;million. In
    December 2009, the agreement was further amended to extend the
    commitment period to December&#160;31, 2011 and increase the
    aggregate capital contribution commitment to $275&#160;million.
    As of December&#160;31, 2009, we had $40&#160;million of
    remaining capital commitment capacity. This commitment will
    terminate upon the consummation of this offering.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Reserve-based
    credit facility</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On February 26, 2010, we entered into an amended and restated
    reserve-based revolving credit facility under which our initial
    borrowing base was set at $85&#160;million. Following the
    completion of this offering, we expect our borrowing base to be
    $70&#160;million with an interest rate of 4.0% and a maturity of
    February&#160;26, 2014. At the earlier of the closing of this
    offering or October&#160;1, 2010, the $15&#160;million
    non-conforming portion of the borrowing base will terminate. Our
    revolving credit facility is filed as an exhibit to the
    registration statement of which this prospectus is a part. Our
    revolving credit facility is available for our general corporate
    purposes, including, without limitation, working capital for
    exploration and production operations. Our obligations under our
    revolving credit facility are secured by substantially all of
    our assets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of March&#160;1, 2010, we had $13.0&#160;million outstanding
    under our revolving credit facility, the substantial majority of
    which was used to fund our drilling and acquisition activities.
    We anticipate that a portion of the net proceeds from this
    offering will be used to repay all of our borrowings outstanding
    as of the closing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At our election, interest is generally determined by reference
    to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the London interbank offered rate, or LIBOR, plus an applicable
    margin between 2.25% and 4.00% per annum;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a domestic bank prime rate plus an applicable margin between
    0.75% and 2.50% per annum.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Interest is generally payable quarterly for domestic bank rate
    loans and on the last day of the applicable interest period for
    LIBOR loans, but not less frequently than quarterly.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our revolving credit facility contains various covenants that
    limit our ability to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    incur indebtedness;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    grant certain liens;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    make certain loans, advances and investments;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    make dividends, distributions or redemptions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    merge or consolidate;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    engage in certain asset dispositions, including a sale of all or
    substantially all of our assets;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into certain transactions with affiliates;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    grant negative pledges or agree to restrict dividends or
    distributions from subsidiaries;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    allow gas imbalances,
    <FONT style="white-space: nowrap">take-or-pay</FONT>
    or other prepayments with respect to oil and gas properties that
    would require us from delivering hydrocarbons in the future in
    excess of an aggregate of 75,000&#160;Mcfe;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into certain swap agreements.
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    50
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our revolving credit facility also contains covenants that,
    among other things, require us to maintain specified ratios or
    conditions as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a current ratio, consisting of consolidated current assets,
    including the unused amount of the total commitments, to
    consolidated current liabilities of not less than 1.0 to 1.0,
    excluding non-cash derivative assets and liabilities, as of the
    last day of any fiscal quarter;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a debt coverage ratio, consisting of consolidated debt
    (excluding non-cash obligations, accounts payable and other
    certain accrued liabilities) to consolidated net income plus
    interest expense, income taxes, depreciation, depletion,
    amortization, exploration expenses and other similar non-cash
    charges, minus all non-cash income added to consolidated net
    income, of not more than 4.0 to 1.0 for the four quarters ended
    on the last day of each fiscal quarter.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We believe that we are in compliance with the terms of our
    revolving credit facility. If an event of default exists under
    the credit agreement, the lenders will be able to accelerate the
    maturity of the credit agreement and exercise other rights and
    remedies. Each of the following will be an event of default:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    failure to pay any principal or any reimbursement obligation
    under any letter of credit when due or any interest, fees or
    other amount within certain grace periods;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a representation or warranty is proven to be incorrect in any
    material respect when made;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    failure to perform or otherwise comply with the covenants in the
    credit agreement or other loan documents, subject, in certain
    instances, to certain grace periods;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    default by us on the payment of any other indebtedness in excess
    of $2.5&#160;million, or any event occurs that permits or causes
    the acceleration of the indebtedness;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    bankruptcy or insolvency events involving us or our subsidiaries;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the entry of, and failure to pay, one or more adverse judgments
    in excess of $2.0&#160;million or one or more non-monetary
    judgments that could reasonably be expected to have a material
    adverse effect and for which enforcement proceedings are brought
    or that are not stayed pending appeal;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a change of control, as defined in the credit agreement.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Obligations
    and Commitments</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have the following contractual obligations and commitments as
    of December&#160;31, 2009 (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="margin-left: 3%; margin-right: 0%">
<TABLE border="0" width="97%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="46%">&nbsp;</TD>         <!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>  <!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>    <!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>  <!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>    <!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>  <!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>    <!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>  <!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=05 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>    <!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>  <!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>    <!-- colindex=06 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>    <!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>     <!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="18" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Payments Due by Period</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Less Than<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>More Than<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Contractual Obligations</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>1&#160;Year</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>1 - 3&#160;Years</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>3 - 5&#160;Years</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>5&#160;Years</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revolving credit facility(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating leases(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    969
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    451
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    518
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Drilling rig commitments(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,575
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,575
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Asset retirement obligations(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,511
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    282
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,872
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    74
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,283
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total contractual cash obligations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    45,055
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,308
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,390
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    74
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,283
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Amount excludes interest on our revolving credit facility as
    both the amount borrowed and applicable interest rate is
    variable. On February&#160;26, 2010, we entered into an amended
    and restated revolving credit facility, which matures on
    February&#160;26, 2014. See Notes&#160;7 and 11 to our
    consolidated financial statements.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    See Note&#160;10 to our consolidated financial statements for a
    description of lease obligations and drilling contract
    commitments.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Amounts represent our estimate of future asset retirement
    obligations on an undiscounted basis. Because these costs
    typically extend many years into the future, estimating these
    future costs requires management to make estimates and judgments
    that are subject to future revisions based upon numerous
    factors, </TD>
</TR>
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    <TD></TD>
    <TD valign="bottom">
    including the rate of inflation, changing technology and the
    political and regulatory environment. See Note&#160;8 to our
    consolidated financial statements.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Critical
    accounting policies and estimates</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The discussion and analysis of our financial condition and
    results of operations are based upon our consolidated financial
    statements, which have been prepared in accordance with
    accounting principles generally accepted in the United States.
    The preparation of our financial statements requires us to make
    estimates and assumptions that affect the reported amounts of
    assets, liabilities, revenues and expenses and related
    disclosure of contingent assets and liabilities. Certain
    accounting policies involve judgments and uncertainties to such
    an extent that there is reasonable likelihood that materially
    different amounts could have been reported under different
    conditions, or if different assumptions had been used. We
    evaluate our estimates and assumptions on a regular basis. We
    base our estimates on historical experience and various other
    assumptions that are believed to be reasonable under the
    circumstances, the results of which form the basis for making
    judgments about the carrying values of assets and liabilities
    that are not readily apparent from other sources. Actual results
    may differ from these estimates and assumptions used in
    preparation of our consolidated financial statements. We provide
    expanded discussion of our more significant accounting policies,
    estimates and judgments below. We believe these accounting
    policies reflect our more significant estimates and assumptions
    used in preparation of our consolidated financial statements.
    See Note&#160;2 to our consolidated financial statements for a
    discussion of additional accounting policies and estimates made
    by management.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Method
    of accounting for oil and natural gas properties</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oil and natural gas exploration and development activities are
    accounted for using the successful efforts method. Under this
    method, all property acquisition costs and costs of exploratory
    and development wells are capitalized when incurred, pending
    determination of whether the well has found proved reserves. If
    an exploratory well does not find proved reserves, the costs of
    drilling the well are charged to expense. The costs of
    development wells are capitalized whether productive or
    nonproductive. All capitalized well costs and leasehold costs of
    proved properties are amortized on a
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    basis over the remaining life of proved developed reserves and
    proved reserves, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Costs of retired, sold or abandoned properties that constitute a
    part of an amortization base (partial field) are charged or
    credited, net of proceeds, to accumulated depreciation,
    depletion and amortization unless doing so significantly affects
    the
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    amortization rate for an entire field, in which case a gain or
    loss is recognized currently. Gains or losses from the disposal
    of properties are recognized currently.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Expenditures for maintenance, repairs and minor renewals
    necessary to maintain properties in operating condition are
    expensed as incurred. Major betterments, replacements and
    renewals are capitalized to the appropriate property and
    equipment accounts. Estimated dismantlement and abandonment
    costs for oil and natural gas properties are capitalized, net of
    salvage, at their estimated net present value and amortized on a
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    basis over the remaining life of the related proved developed
    reserves.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unproved properties consist of costs incurred to acquire
    unproved leases, or lease acquisition costs. Unproved lease
    acquisition costs are capitalized until the leases expire or
    when we specifically identify leases that will revert to the
    lessor, at which time we expense the associated unproved lease
    acquisition costs. The expensing of the unproved lease
    acquisition costs is recorded as impairment expense in the
    statement of operations in our consolidated financial
    statements. Lease acquisition costs related to successful
    exploratory drilling are reclassified to proved properties and
    depleted on a
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    basis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For sales of entire working interests in unproved properties,
    gain or loss is recognized to the extent of the difference
    between the proceeds received and the net carrying value of the
    property. Proceeds from sales of partial interests in unproved
    properties are accounted for as a recovery of costs unless the
    proceeds exceed the entire cost of the property.
</DIV>
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Oil
    and natural gas reserve quantities and standardized measure of
    future net revenue</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our independent engineers and technical staff prepare our
    estimates of oil and natural gas reserves and associated future
    net revenues. While the SEC has recently adopted rules which
    allow us to disclose proved, probable and possible reserves, we
    have elected to present only proved reserves in this prospectus.
    The SEC&#146;s revised rules define proved reserves as the
    quantities of oil and gas, which, by analysis of geoscience and
    engineering data, can be estimated with reasonable certainty to
    be economically producible&#160;&#151; from a given date
    forward, from known reservoirs, and under existing economic
    conditions, operating methods, and government
    regulations&#160;&#151; prior to the time at which contracts
    providing the right to operate expire, unless evidence indicates
    that renewal is reasonably certain, regardless of whether
    deterministic or probabilistic methods are used for the
    estimation. The project to extract the hydrocarbons must have
    commenced or the operator must be reasonably certain that it
    will commence the project within a reasonable time. Our
    independent engineers and technical staff must make a number of
    subjective assumptions based on their professional judgment in
    developing reserve estimates. Reserve estimates are updated
    annually and consider recent production levels and other
    technical information about each field. Oil and natural gas
    reserve engineering is a subjective process of estimating
    underground accumulations of oil and natural gas that cannot be
    precisely measured. The accuracy of any reserve estimate is a
    function of the quality of available data and of engineering and
    geological interpretation and judgment. Periodic revisions to
    the estimated reserves and future cash flows may be necessary as
    a result of a number of factors, including reservoir
    performance, new drilling, oil and natural gas prices, cost
    changes, technological advances, new geological or geophysical
    data, or other economic factors. Accordingly, reserve estimates
    are generally different from the quantities of oil and natural
    gas that are ultimately recovered. We cannot predict the amounts
    or timing of future reserve revisions. If such revisions are
    significant, they could significantly affect future amortization
    of capitalized costs and result in impairment of assets that may
    be material.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Revenue
    recognition</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Revenue from our interests in producing wells is recognized when
    the product is delivered, at which time the customer has taken
    title and assumed the risks and rewards of ownership, and
    collectability is reasonably assured. Substantially all of our
    production is sold to purchasers under short-term (less than
    12&#160;month) contracts at market based prices. The sales
    prices for oil and natural gas are adjusted for transportation
    and other related deductions. These deductions are based on
    contractual or historical data and do not require significant
    judgment. Subsequently, these revenue deductions are adjusted to
    reflect actual charges based on third-party documents. Since
    there is a ready market for oil and natural gas, we sell the
    majority of production soon after it is produced at various
    locations. As a result, we maintain a minimum amount of product
    inventory in storage.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Impairment
    of proved properties</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We review our proved oil and natural gas properties for
    impairment whenever events and circumstances indicate that a
    decline in the recoverability of their carrying value may have
    occurred. We estimate the expected undiscounted future cash
    flows of our oil and natural gas properties and compare such
    undiscounted future cash flows to the carrying amount of the oil
    and natural gas properties to determine if the carrying amount
    is recoverable. If the carrying amount exceeds the estimated
    undiscounted future cash flows, we will adjust the carrying
    amount of the oil and natural gas properties to fair value. The
    factors used to determine fair value are subject to our judgment
    and expertise and include, but are not limited to, recent sales
    prices of comparable properties, the present value of future
    cash flows, net of estimated operating and development costs
    using estimates of proved reserves, future commodity pricing,
    future production estimates, anticipated capital expenditures,
    and various discount rates commensurate with the risk and
    current market conditions associated with realizing the expected
    cash flows projected. Because of the uncertainty inherent in
    these factors, we cannot predict when or if future impairment
    charges for proved properties will be recorded.
</DIV>
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    <B><I><FONT style="font-family: 'Times New Roman', Times">Impairment
    of unproved properties</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We assess our unproved properties periodically for impairment on
    a
    <FONT style="white-space: nowrap">property-by-property</FONT>
    basis based on remaining lease terms, drilling results or future
    plans to develop acreage and records impairment expense for any
    decline in value. The assessment of unproved properties to
    determine any possible impairment requires managerial judgment.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Asset
    retirement obligations</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In accordance with the Financial Accounting Standard
    Board&#146;s (FASB) authoritative guidance on asset retirement
    obligations, or ARO, we record the fair value of a liability for
    a legal obligation to retire an asset in the period in which the
    liability is incurred with the corresponding cost capitalized by
    increasing the carrying amount of the related long-lived asset.
    For oil and gas properties, this is the period in which the well
    is drilled or acquired. The ARO represents the estimated amount
    we will incur to plug, abandon and remediate the properties at
    the end of their productive lives, in accordance with applicable
    state laws. The liability is accreted to its present value each
    period and the capitalized cost is depreciated on the
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    method. The accretion expense is recorded as a component of
    depreciation, depletion and amortization in our consolidated
    statement of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We determine the ARO by calculating the present value of
    estimated cash flows related to the liability. Estimating the
    future ARO requires management to make estimates and judgments
    regarding timing, existence of a liability, as well as what
    constitutes adequate restoration. Inherent in the fair value
    calculation are numerous assumptions and judgments including the
    ultimate costs, inflation factors, credit adjusted discount
    rates, timing of settlement and changes in the legal,
    regulatory, environmental and political environments. To the
    extent future revisions to these assumptions impact the fair
    value of the existing ARO liability, a corresponding adjustment
    is made to the related asset.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Derivatives</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We record all derivative instruments on the balance sheet as
    either assets or liabilities measured at their estimated fair
    value. We have not designated any derivative instruments as
    hedges for accounting purposes and we do not enter into such
    instruments for speculative trading purposes. Realized gains and
    realized losses from the settlement of commodity derivative
    instruments and unrealized gains and unrealized losses from
    valuation changes in the remaining unsettled commodity
    derivative instruments are reported under Other Income (Expense)
    in our consolidated statement of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Recent
    accounting pronouncements</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Fair Value.</I>&#160;&#160;In February 2010, the FASB
    enhanced existing authoritative guidance on certain disclosure
    requirements and added two new disclosure requirements related
    to fair value measurements. The guidance requires a gross
    presentation of activities within the Level&#160;3 roll forward
    and adds a new requirement to disclose details of significant
    transfers in and out of Level&#160;1 and 2 measurements and the
    reasons for the transfers. The new disclosures are required for
    all companies that are required to provide disclosures about
    recurring and nonrecurring fair value measurements, and is
    effective the first interim or annual reporting period beginning
    after December&#160;15, 2009, except for the gross presentation
    of the Level&#160;3 roll forward information, which is required
    for annual reporting periods beginning after December&#160;15,
    2010 and for interim reporting periods within those years. We do
    not expect the adoption of this new guidance to have a
    significant impact on our financial position, cash flows or
    results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Oil and Gas Reporting Requirements.</I>&#160;&#160;In
    December 2008, the SEC released the final rule,
    &#147;Modernization of Oil and Gas Reporting,&#148; which adopts
    revisions to the SEC&#146;s oil and gas reporting disclosure
    requirements. The disclosure requirements under this final rule
    require reporting of oil and gas reserves using the unweighted
    arithmetic average of the
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    price for the preceding twelve months rather than year-end
    prices, and the use of new technologies to determine proved
    reserves if those technologies have been demonstrated to result
    in reliable conclusions about reserves volumes. Companies are
    allowed, but not required, to disclose probable and possible
    reserves in SEC filings. In addition, companies are required to
</DIV>
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    report the independence and qualifications of their reserves
    preparer or auditor and file reports when a third party is
    relied upon to prepare reserves estimates or conduct a reserves
    audit. In January 2010, the FASB issued authoritative guidance
    on oil and gas reserve estimation and disclosure, aligning their
    requirements with the SEC&#146;s final rule. We have presented
    and applied this new guidance for the year ended
    December&#160;31, 2009 herein.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Disclosures about Derivative Instruments and Hedging
    Activities.</I>&#160;&#160;In March 2008, the FASB issued
    authoritative guidance related to disclosures about derivative
    instruments and hedging activities. Disclosures previously
    required only for the annual financial statements are now
    required in interim financial statements. This guidance is
    intended to improve financial reporting about derivative
    instruments and hedging activities by requiring companies to
    enhance disclosure about how these instruments and activities
    affect their financial position, performance and cash flows and
    to improve the transparency of the location and amounts of
    derivative instruments in a company&#146;s financial statements
    and how they are accounted for. This guidance was effective for
    us beginning January&#160;1, 2009. The adoption of this guidance
    did not have a significant impact on our consolidated financial
    position, results of operations or cash flows.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Business Combinations.</I>&#160;&#160;In December 2007, the
    FASB revised the authoritative guidance for business
    combinations, extending its applicability to all transactions
    and other events in which one entity obtains control over one or
    more other businesses. The revised guidance broadens the fair
    value measurement and recognition of assets acquired,
    liabilities assumed and interests transferred as a result of
    business combinations and requires that acquisition-related
    costs incurred prior to the acquisition be expensed. The revised
    guidance also expands the definition of what qualifies as a
    business, and this expanded definition could include prospective
    oil and gas purchases. Additionally, this guidance expands the
    required disclosures to improve the financial statement
    users&#146; abilities to evaluate the nature and financial
    effects of business combinations. The guidance is effective for
    business combinations for which the acquisition date is on or
    after January&#160;1, 2009.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Internal
    Controls and Procedures</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the completion of this offering, we have been a private
    company with limited accounting personnel to adequately execute
    our accounting processes and other supervisory resources with
    which to address our internal control over financial reporting.
    As such, we have not maintained an effective control environment
    in that the design and execution of our controls has not
    consistently resulted in effective review and supervision by
    individuals with financial reporting oversight roles. The lack
    of adequate staffing levels resulted in insufficient time spent
    on review and approval of certain information used to prepare
    our financial statements. We have concluded that these control
    deficiencies constitute a material weakness in our control
    environment. A material weakness is a control deficiency, or a
    combination of control deficiencies, in internal control over
    financial reporting, such that there is a reasonable possibility
    that a material misstatement of our annual or interim financial
    statements will not be prevented or detected on a timely basis.
    The control deficiencies described above, at varying degrees of
    severity, contributed to the material weaknesses in the control
    environment, as described below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2007, we did not maintain effective controls to ensure that
    correct working interests were used in our calculations of asset
    retirement obligations and depreciation, depletion and
    amortization expense. In 2008, the lack of effective controls
    over the accuracy of working interests and the accurate clearing
    of asset retirement obligations resulted in the misstatement of
    our proved property impairment expense. In 2009, we did not
    maintain effective controls over the accuracy of key
    spreadsheets used in our computations of unproved property
    impairment expense. For each of those years, effective controls
    were not adequately designed or consistently operating to ensure
    that key computations were properly reviewed before the amounts
    were recorded in our accounting records. The above identified
    control deficiencies resulted in audit adjustments to our
    consolidated financial statements during 2007, 2008 and 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although remediation efforts are still in progress, management
    has taken steps to address the causes of the 2007 and 2008 audit
    adjustments by putting into place new accounting processes and
    control procedures. Management created a centralized source for
    working interests and implemented controls to ensure that
    working interests used in reserve report information and
    accounting computations are reconciled to the
</DIV>
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    <BR>
    55
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    centralized source of working interests. Management also
    implemented an account reconciliation and analysis process to
    ensure the correct recording of asset retirement obligations. In
    addition, management is in the process of evaluating the
    remediation steps needed to address the cause of the 2009 audit
    adjustment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In January 2010, we hired a financial reporting manager and an
    operations accountant to allow for additional preparation and
    review time during our monthly accounting close process. During
    2010, we expect to implement a comprehensive review of our
    internal controls, including our overall control environment,
    and to formalize our review and approval processes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    While we have begun the process of evaluating our internal
    control over financial reporting, we are in the early phases of
    our review and will not complete our review until well after
    this offering is completed. We cannot predict the outcome of our
    review at this time. During the course of the review, we may
    identify additional control deficiencies of varying degrees of
    severity, in addition to the material weaknesses discussed
    above. Management has taken steps to improve our internal
    control over financial reporting, including the implementation
    of new accounting processes and control procedures and the
    identification of gaps in our skills base and expertise of the
    staff required to meet the financial reporting requirements of a
    public company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are not currently required to comply with the SEC&#146;s
    rules implementing Section&#160;404 of the Sarbanes Oxley Act of
    2002, and are therefore not required to make a formal assessment
    of the effectiveness of our internal control over financial
    reporting for that purpose. Upon becoming a public company, we
    will be required to comply with the SEC&#146;s rules
    implementing Section&#160;302 of the Sarbanes-Oxley Act of 2002,
    which will require our management to certify financial and other
    information in our quarterly and annual reports and provide an
    annual management report on the effectiveness of our internal
    control over financial reporting. We will not be required to
    make our first assessment of our internal control over financial
    reporting until the year following our first annual report
    required to be filed with the SEC. To comply with the
    requirements of being a public company, we will need to upgrade
    our systems, including information technology, implement
    additional financial and management controls, reporting systems
    and procedures and hire additional accounting, finance and legal
    staff.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Further, our independent registered public accounting firm is
    not yet required to formally attest to the effectiveness of our
    internal controls over financial reporting until the year
    following our first annual report required to be filed with the
    SEC. Once it is required to do so, our independent registered
    public accounting firm may issue a report that is adverse in the
    event it is not satisfied with the level at which our controls
    are documented, designed, operated or reviewed. Our remediation
    efforts may not enable us to remedy or avoid material weaknesses
    or significant deficiencies in the future.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Inflation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Inflation in the United States has been relatively low in recent
    years and did not have a material impact on our results of
    operations for the period from February&#160;26, 2007 through
    December&#160;31, 2007 and the years ended 2008 and 2009.
    Although the impact of inflation has been insignificant in
    recent years, it is still a factor in the United States economy
    and we tend to experience inflationary pressure on the cost of
    oilfield services and equipment as increasing oil and gas prices
    increase drilling activity in our areas of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Quantitative
    and Qualitative Disclosures About Market Risk</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are exposed to a variety of market risks including commodity
    price risk, interest rate risk and counterparty and customer
    risk. We address these risks through a program of risk
    management including the use of derivative instruments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Commodity price exposure.</I>&#160;&#160;We are exposed to
    market risk as the prices of oil and natural gas fluctuate as a
    result of changes in supply and demand and other factors. To
    partially reduce price risk caused by these market fluctuations,
    we have entered into derivative instruments in the past and
    expect to enter into derivative instruments in the future to
    cover a significant portion of our future production.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We utilize derivative financial instruments (primarily swaps and
    zero-cost collars) to manage risks related to changes in oil
    prices. As of December&#160;31, 2009, we utilized fixed-price
    swap agreements and zero-cost
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    56
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    collar options, or Derivative Contracts, to reduce the
    volatility of oil prices on a significant portion of our future
    expected oil production.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For derivative instruments recorded at fair value, the credit
    standing of our counterparties is analyzed and factored into the
    fair value amounts recognized on the balance sheet.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a summary of our Derivative Contracts as of
    December&#160;31, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="30%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="14%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Total Notional<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Derivative<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Amount of Oil<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Floor<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Ceiling<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Fair<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Settlement Period</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Instrument</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(Barrels)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Price</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Price</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fixed Price</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Market Value</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2010
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    NYMEX Swap
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,163
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    72.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (26
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2010
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    NYMEX Collar
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    401,814
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    67.48
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    90.19
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (841
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2011
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    NYMEX Collar
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    186,764
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    61.49
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82.23
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2012
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    NYMEX Collar
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,618
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    80.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (174
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
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</TD>
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</TD>
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</TD>
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&nbsp;
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<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,953
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Interest rate risk.</I>&#160;&#160;At December&#160;31, 2009,
    we had indebtedness outstanding under our prior revolving credit
    facility of $35.0&#160;million, which bore interest at floating
    rates. The weighted average annual interest rate incurred on
    this indebtedness for the years ended December&#160;31, 2009 and
    2008 and the period ended December&#160;31, 2007 was
    approximately 3.5%, 6.3% and 7.8%, respectively. A 1.0% increase
    in each of the average LIBOR and federal funds rate for the year
    ended December&#160;31, 2009 would have resulted in an estimated
    $0.2&#160;million increase in interest expense for the year
    ended December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We may utilize interest rate derivatives to alter interest rate
    exposure in an attempt to reduce interest rate expense related
    to existing debt issues. Interest rate derivatives are used
    solely to modify interest rate exposure and not to modify the
    overall leverage of the debt portfolio.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Counterparty and customer credit risk.</I>&#160;&#160;Joint
    interest receivables arise from billing entities which own
    partial interest in the wells we operate. These entities
    participate in our wells primarily based on their ownership in
    leases on which we wish to drill. We have limited ability to
    control participation in our wells. We are also subject to
    credit risk due to concentration of our oil and natural gas
    receivables with several significant customers. See
    &#147;Business&#160;&#151; Marketing and Major Customers&#148;
    for further detail about our significant customers. We do not
    require our customers to post collateral. The inability or
    failure of our significant customers to meet their obligations
    to us or their insolvency or liquidation may adversely affect
    our financial results. In addition, our oil and natural gas
    derivative arrangements expose us to credit risk in the event of
    nonperformance by counterparties.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Off-Balance
    Sheet Arrangements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Currently, we do not have any off-balance sheet arrangements.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    57
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='111'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">BUSINESS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are an independent exploration and production company focused
    on the acquisition and development of unconventional oil and
    natural gas resources. We have accumulated approximately
    292,000&#160;net leasehold acres in the Williston Basin,
    approximately 85% of which are undeveloped. We are currently
    focused on exploiting what we have identified as significant
    resource potential from the Bakken and Three Forks formations,
    which are present across a substantial majority of our acreage.
    A report issued by the United States Geologic Survey, or USGS,
    in April 2008 classified these formations as the largest
    continuous oil accumulation ever assessed by it in the
    contiguous United States, with approximately 3.65&#160;billion
    barrels of technically recoverable oil resources. We believe the
    location, size and concentration of our acreage creates an
    opportunity for us to achieve cost, recovery and production
    efficiencies through the large-scale development of our project
    inventory. Our management team has a proven track record in
    identifying, acquiring and executing large, repeatable
    development drilling programs, which we refer to as
    &#147;resource conversion&#148; opportunities, and has
    substantial experience in the Williston Basin. We have built our
    leasehold acreage position in the Williston Basin primarily
    through acquisitions in our three primary project areas, West
    Williston, East Nesson and Sanish. For a description of our
    acquisition activity, please see &#147;&#151;Our Acquisition
    History&#148; below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    DeGolyer and MacNaughton, our independent reserve engineers,
    estimated our net proved reserves to be 13.3&#160;MMBoe as of
    December&#160;31, 2009, 42% of which were classified as proved
    developed and 93% of which were comprised of oil. The following
    table presents summary data for each of our primary project
    areas as of December&#160;31, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="34%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=09 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=09 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=09 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=09 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=10 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=10 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=10 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=10 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2010 Budget</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Identified Drilling<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Drilling<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Estimated Net<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Daily<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Net<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Locations</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Gross<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Net<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Capex<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Proved Reserves</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Production<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Acreage</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Wells</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Wells</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(In millions)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>MMBoe</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>% Developed</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(Boe/d)(1)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    West Williston(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159,491
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    268
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    106.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    41
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    110
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    55
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,106
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    East Nesson(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    124,004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    113
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,016
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Sanish(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,747
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    88
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    792
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    292,242
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    173.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    91
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,914
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    879
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    293,121
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    469
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    173.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    91
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,073
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents average daily production for the three months ended
    December&#160;31, 2009.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Identified gross and net drilling locations in our West
    Williston and East Nesson project areas are primarily comprised
    of Bakken wells based on 1,280-acre spacing and do not include
    any infill wells targeting the Bakken formation or any primary
    or infill wells targeting the Three Forks formation.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Identified gross and net drilling locations in our Sanish
    project area include a single Bakken infill well per 1,280-acre
    or <FONT style="white-space: nowrap">640-acre</FONT>
    spacing unit (excluding spacing units already containing two
    Bakken producing wells) and include 10&#160;gross (1.6 net)
    primary wells targeting the Three Forks formation.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In our West Williston and East Nesson project areas, we have an
    inventory of approximately 381&#160;gross primary drilling
    locations (23 of which are proved undeveloped), substantially
    all of which are on 1,280-acre spacing targeting the Bakken
    formation. We plan to aggressively develop these specifically
    identified drilling locations using horizontal drilling and
    multi-stage fracture stimulation techniques. In our Sanish
    project area, we have an additional 88&#160;gross non-operated
    drilling locations (63 of which are proved undeveloped). A
    single additional infill well per spacing unit targeting the
    Bakken formation across all three of our Williston Basin project
    areas would add over 500 incremental potential drilling
    locations. We are also evaluating the resource potential in the
    Three Forks formation across our leasehold position and believe
    there may be a significant number of additional potential
    drilling locations targeting this formation.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    58
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our total 2010 capital expenditure budget is $220&#160;million,
    which consists&#160;of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $134&#160;million for drilling and completing operated wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $45&#160;million for drilling and completing non-operated wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $15&#160;million for maintaining and expanding our leasehold
    position;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $5&#160;million for constructing infrastructure to support
    production in our core project areas;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $21&#160;million in unallocated funds which are available for
    additional drilling and leasing costs and activity.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    While we have budgeted $220&#160;million for these purposes, the
    ultimate amount of capital we will expend may fluctuate
    materially based on market conditions and the success of our
    drilling results as the year progresses. Please see
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#160;&#151; Liquidity and
    Capital Resources.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Acquisition History</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We built our leasehold position in our West Williston, East
    Nesson and Sanish project areas through the following
    acquisitions and development activities:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In June 2007, we acquired approximately 175,000&#160;net
    leasehold acres in the Williston Basin with then-current net
    production of approximately 1,000 Boe/d. This acreage is the
    core of our West Williston project area.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In May 2008, we entered into a farm-in and purchase arrangement,
    under which we earned or acquired approximately 48,000&#160;net
    leasehold acres, establishing our initial position in the East
    Nesson project area.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In June 2009, we acquired approximately 40,000&#160;net
    leasehold acres with then-current net production of
    approximately 800 Boe/d, approximately 83% of which was from the
    Williston Basin. This acquisition consolidated our acreage in
    the East Nesson project area and established our Sanish project
    area.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    In September 2009, we acquired an additional 46,000&#160;net
    leasehold acres with then-current net production of
    approximately 300 Boe/d. This acquisition further consolidated
    our acreage in the East Nesson project area.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Business Strategy</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our goal is to increase stockholder value by building reserves,
    production and cash flows at an attractive return on invested
    capital. We seek to achieve our goals through the following
    strategies:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Aggressively Develop our Williston Basin Leasehold
    Position.</I>&#160;&#160;We intend to aggressively drill and
    develop our acreage position to maximize the value of our
    resource potential. The aggregate 469&#160;gross drilling
    locations that we have specifically identified in the Bakken
    formation in our three project areas will be our primary targets
    in the near term. Our 2010 drilling plan contemplates drilling
    approximately 35&#160;gross (22.4 net) operated wells in these
    project areas by using two operated drilling rigs for the full
    year and adding up to three additional drilling rigs later in
    the year. Subject to market conditions and rig availability, we
    expect to operate five drilling rigs in 2011, which could enable
    us to drill as many as 60&#160;gross operated wells during that
    year. We believe we have the ability to add additional rigs this
    year if market conditions and program results warrant.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Enhance Returns by Focusing on Operational and Cost
    Efficiencies.</I>&#160;&#160;Our management team is focused on
    continuous improvement of our operating measures and has
    significant experience in successfully converting early-stage
    resource opportunities into cost-efficient development projects.
    We believe the magnitude and concentration of our acreage within
    our project areas provides us with the opportunity to capture
    economies of scale, including the ability to drill multiple
    wells from a single drilling pad, utilizing centralized
    production and fluid handling facilities and reducing the time
    and cost of rig mobilization.
</TD>
</TR>

</TABLE>
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    <BR>
    59
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Adopt and Employ Leading Drilling and Completion
    Techniques.</I>&#160;&#160;Our team is focused on enhancing our
    drilling and completion techniques to maximize recovery. We
    believe these techniques have significantly evolved over the
    last several years, resulting in increased initial production
    rates and recoverable hydrocarbons per well through the
    implementation of techniques such as using longer laterals and
    more tightly spaced fracturing stimulation stages. We
    continuously evaluate our internal drilling results and monitor
    the results of other operators to improve our operating
    practices, and we expect our drilling and completion techniques
    will continue to evolve. This continued evolution may
    significantly enhance our initial production rates, ultimate
    recovery factors and rate of return on invested capital.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Pursue Strategic Acquisitions with Significant Resource
    Potential.</I>&#160;&#160;In the near term, we intend to
    identify and acquire additional acreage and producing assets in
    the Williston Basin to supplement our existing operations. Going
    forward, we expect to selectively target additional domestic
    basins that would allow us to employ our resource conversion
    strategy on large undeveloped acreage positions similar to what
    we have accumulated in the Williston Basin. While we have no
    current intention to pursue international opportunities, our
    management team has significant international acquisition and
    operating expertise. If we identify an international opportunity
    with appropriate scale, risk and resource conversion potential,
    our board of directors may approve such an investment should
    they determine it is in the long-term best interest of our
    stockholders to do&#160;so.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Competitive Strengths</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have a number of competitive strengths that we believe will
    help us to successfully execute our business strategies:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Substantial Leasehold Position in one of North America&#146;s
    Leading Unconventional Oil-Resource Plays.</I>&#160;&#160;Our
    current leasehold position of approximately 292,000&#160;net
    leasehold acres in the Williston Basin is highly prospective in
    the Bakken formation. We believe our Williston Basin acreage is
    one of the largest concentrated leasehold positions in the
    basin, and much of our acreage is in areas of significant
    drilling activity by other exploration and production companies.
    While we are initially targeting the Bakken formation, we are
    also evaluating what we believe to be significant prospectivity
    in the Three Forks formation which underlies a large portion of
    our acreage. We expect that the scale and concentration of our
    acreage will enable us to continue to improve our drilling and
    completion costs and operational efficiency.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Large, Multi-Year Project Inventory.</I>&#160;&#160;We have
    an inventory of approximately 469&#160;gross drilling locations,
    primarily targeting the Bakken formation. We plan to drill
    35&#160;gross (22.4 net) operated wells across our West
    Williston and East Nesson project areas in 2010, the completion
    of which would represent 14% of our 246&#160;gross identified
    operated drilling locations in these two project areas. We may
    be able to enhance the total recovery from the Bakken formation
    by drilling potential infill locations. In addition, our total
    number of drilling locations may also be substantially increased
    by pursuing the prospectivity we have identified in the Three
    Forks formation.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Management Team with Proven Acquisition and Operating
    Skills.</I>&#160;&#160;Our senior management team has extensive
    expertise in the oil and gas industry as previous members of
    management at Burlington Resources. The senior technical team
    has an average of more than 25&#160;years of industry
    experience, including experience in multiple North American
    resource plays as well as experience in other North American and
    international basins. We believe our management and technical
    team is one of our principal competitive strengths relative to
    our industry peers due to our team&#146;s proven track record in
    identification, acquisition and execution of resource conversion
    opportunities. In addition, this team possesses substantial
    expertise in horizontal drilling techniques and managing and
    acquiring large development programs, and also has prior
    experience in the Williston Basin.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Incentivized Management Team.</I>&#160;&#160;Our management
    team will own a significant direct ownership interest in us
    immediately following the completion of this offering. In
    addition, our management team will own an indirect interest in
    OAS Holdco, which will
    own&#160;&#160;&#160;&#160;&#160;&#160;shares of our common
    stock upon
</TD>
</TR>
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    <BR>
    60
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    completion of this offering. Our management team may
    significantly increase its sharing percentage in the shares held
    by OAS Holdco by increasing the return on investment for the
    other members of OAS Holdco. We believe our management
    team&#146;s direct ownership interest immediately following the
    offering as well as their ability to increase their interest
    over time through OAS Holdco provides significant incentives to
    grow the value of our business for the benefit of all
    stockholders. See &#147;Corporate Reorganization&#160;&#151; LLC
    Agreement of OAS Holdco.&#148;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Operating Control over the Majority of our
    Portfolio.</I>&#160;&#160;In order to maintain better control
    over our asset portfolio, we have established a leasehold
    position comprised primarily of properties that we expect to
    operate. Controlling operations will allow us to dictate the
    pace of development as well as the costs, type and timing of
    exploration and development activities. We believe that
    maintaining operational control over the majority of our acreage
    will allow us to better pursue our strategies of enhancing
    returns through operational and cost efficiencies and maximizing
    hydrocarbon recovery through continuous improvement of drilling
    and completion techniques.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Recent
    Developments</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Drilling Activity.</I>&#160;&#160;Since December&#160;31,
    2009, we have drilled four operated wells in the Bakken
    formation, each of which is being completed. Additionally, we
    currently have one operated drilling rig in the West Williston
    project area and another in the East Nesson project area, each
    of which is drilling a well targeting the Bakken formation. Of
    the 16&#160;gross (1.6&#160;net) non-operated wells in progress
    on December&#160;31, 2009, 9&#160;gross (0.7&#160;net) wells
    have initiated production and 7&#160;gross (0.9&#160;net) wells
    are under completion operations.  Subsequent to
    December&#160;31, 2009, an additional 14&#160;gross
    (0.9&#160;net) non-operated wells have begun operations and are
    being drilled or completed.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Amended and Restated Credit Facility.</I>&#160;&#160;On
    February&#160;26, 2010, we entered into an amended and restated
    revolving credit facility, which will have a borrowing base of
    $70&#160;million upon completion of this offering. Borrowings
    under our revolving credit facility accrue interest at an
    initial rate of 4.0% per annum. Our revolving credit facility
    matures on February&#160;26, 2014. Please see
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#160;&#151; Liquidity and
    Capital Resources&#160;&#151; Reserve-based credit
    facility.&#148; As of March&#160;1, 2010, we had
    $13.0&#160;million of indebtedness outstanding under our
    revolving credit facility. We anticipate that a portion of the
    net proceeds from this offering will be used to repay all of our
    borrowings outstanding as of the closing.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Marketing
    and Transportation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Williston Basin crude oil transportation and refining
    infrastructure has grown substantially in recent years, largely
    in response to drilling activity in the Bakken formation. As of
    February&#160;15, 2010, there was approximately
    334,600&#160;barrels per day of crude oil transportation and
    refining capacity in the Williston Basin, comprised of
    276,600&#160;barrels per day of pipeline transportation capacity
    and 58,000&#160;barrels per day of refining capacity at the
    Tesoro Corporation Mandan refinery. In addition,
    60,000&#160;barrels per day of specifically dedicated railcar
    transportation capacity has recently been placed into service in
    the Williston Basin. Based on publicly announced expansion
    projects, pipeline transportation capacity for Williston Basin
    oil production could increase by 30,000 to 115,000&#160;barrels
    per day by 2013, and we believe additional projects are under
    consideration. For a discussion of the potential risks to our
    business that could result from transportation and refining
    infrastructure constraints in the Williston Basin, please see
    &#147;Risk Factors&#160;&#151; Delays and interruptions of
    production from our wells due to marketing and transportation
    constraints in the Williston Basin could cause significant
    fluctuations in our realized oil and natural gas prices.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Operations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Estimated
    proved reserves</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless otherwise specifically identified in this prospectus, the
    summary data with respect to our estimated proved reserves
    presented below has been prepared by our independent reserve
    engineering firms in accordance with rules and regulations of
    the SEC applicable to companies involved in oil and natural gas
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    producing activities. As discussed below, the SEC has adopted
    new rules relating to disclosures of estimated reserves that are
    effective for fiscal years ending on or after December&#160;31,
    2009. In this prospectus, proved reserve estimates do not
    include any value for probable or possible reserves which may
    exist, categories which the new SEC rules would for the first
    time permit us to disclose in public reports. Our estimated
    proved reserves under the SEC rules in effect for the years
    ended December&#160;31, 2007 and 2008 were determined using
    constant prices and unescalated costs based on the prices
    received and costs incurred on a
    <FONT style="white-space: nowrap">field-by-field</FONT>
    basis as of the year end. For the year ended December&#160;31,
    2009 and for future periods, our estimated proved reserves are
    determined using the preceding twelve months&#146; unweighted
    arithmetic average of the
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    prices, rather than year-end prices. For a definition of proved
    reserves under the SEC rules for both the fiscal years ending on
    or after December&#160;31, 2009 and the fiscal years ending
    prior to December&#160;31, 2009, see the &#147;Glossary of Oil
    and Natural Gas Terms&#148; beginning on
    <FONT style="white-space: nowrap">page&#160;A-1</FONT>
    of this prospectus. For more information regarding our
    independent reserve engineers, please see
    &#147;&#151;&#160;Independent petroleum engineers&#148; below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The table below summarizes our estimated proved reserves and
    related
    <FONT style="white-space: nowrap">PV-10</FONT> at
    December&#160;31, 2008 for each of our core operating areas as
    prepared consistent with the SEC&#146;s rules regarding natural
    gas and oil reserve reporting in effect for fiscal years ending
    prior to December&#160;31, 2009. The table also summarizes our
    estimated proved reserves and related
    <FONT style="white-space: nowrap">PV-10</FONT> at
    December&#160;31, 2009 for each of our project areas as prepared
    consistent with our and our independent reserve engineers&#146;
    interpretation of the SEC&#146;s new rules. The SEC&#146;s new
    rules relating to disclosures of estimated oil and natural gas
    reserves are effective for fiscal years ending on or after
    December&#160;31, 2009. These new rules require SEC reporting
    companies to prepare their reserve estimates using revised
    reserve definitions and revised pricing based on
    <FONT style="white-space: nowrap">12-month</FONT>
    historical unweighted
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    average prices.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The reserve estimates at December&#160;31, 2009 presented in the
    table below are based on a report prepared by DeGolyer and
    MacNaughton, independent reserve engineers. In preparing its
    report, DeGolyer and MacNaughton evaluated properties
    representing all of our
    <FONT style="white-space: nowrap">PV-10</FONT> at
    December&#160;31, 2009 under the new SEC rules. The reserve
    estimates at December&#160;31, 2008 presented in the table below
    are based on reports prepared by W.D. Von Gonten&#160;&#038;
    Co., independent reserve engineers. In preparing its report,
    W.D. Von Gonten&#160;&#038; Co. evaluated properties
    representing all of our
    <FONT style="white-space: nowrap">PV-10</FONT> at
    December&#160;31, 2008 using the SEC rules in effect at the time
    of the report. For more information regarding our independent
    reserve engineers, please see &#147;&#151;&#160;Independent
    petroleum engineers&#148; below. The information in the
    following table does not give any effect to or reflect our
    commodity hedges.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="41%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>At December&#160;31, 2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>At December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Proved Reserves<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>PV-10(1)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Proved Reserves<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>PV-10<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Project Area</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MMBoe)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(in millions)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MMBoe)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(in millions)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    West Williston
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    16.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    50.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    East Nesson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Sanish
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    132.9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    133.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 2pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    The <FONT style="white-space: nowrap">PV-10</FONT>
    amount included in the report of W.D. Von Gonten&#160;&#038; Co.
    at December&#160;31, 2008 was $19.2&#160;million because such
    amount does not give effect to additional estimated plugging and
    abandonment costs.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents data relating to our properties in the Barnett shale.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Estimated proved reserves at December&#160;31, 2009 were
    13.3&#160;MMBoe, with a
    <FONT style="white-space: nowrap">PV-10</FONT> of
    $133.5&#160;million. Our estimated proved reserves at
    December&#160;31, 2009 increased 11.0&#160;MMBoe and
    <FONT style="white-space: nowrap">PV-10</FONT>
    increased $115.8&#160;million over our estimated proved reserves
    and <FONT style="white-space: nowrap">PV-10</FONT> at
    December&#160;31, 2008 due to the results of our drilling
    program, acquisitions and a higher oil price assumption at
    December&#160;31, 2009.
</DIV>
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    <BR>
    62
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth more information regarding our
    estimated proved reserves at December&#160;31, 2007, 2008 and
    2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="77%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>At December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Estimated proved reserves(1):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Oil (MMBbls)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Natural gas (Bcf)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Total estimated proved reserves (MMBoe)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved developed (MMBoe)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Percent developed
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    81
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved undeveloped (MMBoe)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <FONT style="white-space: nowrap">PV-10</FONT> (in
    millions)(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    121.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    133.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Standardized Measure (in millions)(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    121.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    133.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Our estimated proved reserves and related future net revenues,
    <FONT style="white-space: nowrap">PV-10</FONT> and
    Standardized Measure were determined using index prices for oil
    and natural gas, without giving effect to derivative
    transactions, and were held constant throughout the life of the
    properties. The index prices were $96.00/Bbl for oil and
    $7.16/MMBtu for natural gas at December 31, 2007, and $44.60/Bbl
    for oil and $5.63/MMBtu for natural gas at December 31, 2008,
    and the unweighted arithmetic average first-day-of-the-month
    prices for the prior 12 months were $61.04/Bbl for oil and
    $3.87/MMBtu for natural gas at December 31, 2009. These prices
    were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="white-space: nowrap">PV-10</FONT> is a
    non-GAAP financial measure and generally differs from
    Standardized Measure, the most directly comparable GAAP
    financial measure, because it does not include the effects of
    income taxes on future net revenues. However, our
    <FONT style="white-space: nowrap">PV-10</FONT> and
    our Standardized Measure are equivalent because as of
    December&#160;31, 2009, we were a limited liability company not
    subject to entity level taxation. Accordingly, no provision for
    federal or state corporate income taxes has been provided
    because taxable income is passed through to our equity holders.
    However, in connection with the closing of this offering, we
    will merge into a corporation that will become a holding company
    for Oasis Petroleum LLC. As a result, we will be treated as a
    taxable entity for federal income tax purposes. Neither
    <FONT style="white-space: nowrap">PV-10</FONT> nor
    Standardized Measure represents an estimate of the fair market
    value of our oil and natural gas properties. We and others in
    the industry use
    <FONT style="white-space: nowrap">PV-10</FONT> as a
    measure to compare the relative size and value of proved
    reserves held by companies without regard to the specific tax
    characteristics of such entities. The PV-10 amounts included in
    the reports of W.D. Von Gonten &#038; Co. at December 31, 2007
    and at December 31, 2008 were $122.9 million and $19.2 million,
    respectively, because the PV-10 amounts included in such reports
    do not give effect to additional estimated plugging and
    abandonment costs.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Standardized Measure represents the present value of estimated
    future net cash inflows from proved oil and natural gas
    reserves, less estimated future development, production,
    plugging and abandonment costs and income tax expenses (if
    applicable), discounted at 10% per annum to reflect timing of
    future cash flows. In connection with the closing of this
    offering, we will merge into a corporation that will be treated
    as a taxable entity for federal income tax purposes. Future
    calculation of Standardized Measure will include the effects of
    income taxes on future net revenues. For further discussion of
    income taxes, see &#147;Management&#146;s Discussion and
    Analysis of Financial Condition and Results of Operations.&#148;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Estimated proved reserves at December&#160;31, 2009 were
    13.3&#160;MMBoe, a 477% increase from reserves of 2.3&#160;MMBoe
    at December&#160;31, 2008. Our 2009 estimated proved reserves
    increased 11.0&#160;MMBoe over our 2008 estimated reserves due
    to acquisitions, our drilling program and higher oil price
    assumptions at December&#160;31, 2009. Our commodity price
    assumption for oil increased $16.44&#160;per Bbl to $61.04 per
    Bbl for the year ended December&#160;31, 2009 from $44.60 per
    Bbl for the year ended December&#160;31, 2008. Our proved
    developed producing reserves increased 3.3&#160;MMBoe or 144% to
    5.6&#160;MMBoe for the year ended December&#160;31, 2009 from
    2.3&#160;MMBoe for the year ended December&#160;31, 2008 due to
    acquisitions and our drilling program. Our
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    63
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    proved undeveloped reserves increased to 7.7&#160;MMBoe for the
    year ended December&#160;31, 2009 from 0.0&#160;MMBoe for the
    year ended December&#160;31, 2008 due to significant regional
    drilling activity, higher commodity price assumptions and higher
    overall estimated ultimate recoveries using recent drilling and
    completion techniques.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Estimated proved reserves at December&#160;31, 2008 were
    2.3&#160;MMBoe, a 47% decrease from reserves of 4.3&#160;MMBoe
    at December&#160;31, 2007. Our estimated proved reserves
    decreased 2.0&#160;MMBoe for the year ended December&#160;31,
    2008 from December&#160;31, 2007 due primarily to lower
    commodity price assumptions. Our commodity price assumption for
    oil decreased $51.40 per Bbl to $44.60 per Bbl at
    December&#160;31, 2008 from $96.00 per Bbl at December&#160;31,
    2007. Our proved developed producing reserves decreased
    0.9&#160;MMBoe or 28% to 2.3&#160;MMBoe at December&#160;31,
    2008 from 3.2&#160;MMBoe at December&#160;31, 2007 due to
    commodity price assumption and production. Our proved
    undeveloped reserves decreased from 0.8&#160;MMBoe at
    December&#160;31, 2007 to no proved undeveloped reserves at
    December&#160;31, 2008 due to the effect of lower commodity
    price assumptions and drilling results in conventional
    reservoirs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The <FONT style="white-space: nowrap">PV-10</FONT> of
    our estimated proved reserves at December&#160;31, 2009 was
    $133.5&#160;million, a 653% increase from
    <FONT style="white-space: nowrap">PV-10</FONT> of
    $17.7&#160;million at December&#160;31, 2008. Our
    <FONT style="white-space: nowrap">PV-10</FONT> of
    estimated proved reserves increased $115.8&#160;million over the
    2008 <FONT style="white-space: nowrap">PV-10</FONT>
    due to an increase in reserves and higher oil price assumptions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth the estimated future net
    revenues, excluding derivatives contracts, from proved reserves,
    the present value of those net revenues
    <FONT style="white-space: nowrap">(PV-10),</FONT> and
    the expected benchmark prices used in projecting net revenues at
    December&#160;31, 2007, 2008 and 2009 (in millions):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="77%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="11" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>At December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future net revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    227.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    27.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    286.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Present value of future net revenues:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Before income tax
    <FONT style="white-space: nowrap">(PV-10)</FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    121.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    133.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    After income tax (Standardized Measure)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    121.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    133.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Benchmark oil price(1)($/Bbl)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    96.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    44.60
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    61.04
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Our estimated proved reserves and related future net revenues,
    <FONT style="white-space: nowrap">PV-10</FONT> and
    Standardized Measure were determined using index prices for oil
    and natural gas, without giving effect to derivative
    transactions, and were held constant throughout the life of the
    properties. The index prices were $96.00/Bbl for oil and
    $7.16/MMBtu for natural gas at December&#160;31, 2007, and
    $44.60/Bbl for oil and $5.63/MMBtu for natural gas at
    December&#160;31, 2008, and the unweighted arithmetic average
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    prices for the prior 12&#160;months were $61.04/Bbl for oil and
    $3.87/MMBtu for natural gas at December&#160;31, 2009.  These
    prices were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead. The
    PV-10 amounts included in the reports of W.D. Von Gonten &#038;
    Co. at December 31, 2007 and at December 31, 2008 were $122.9
    million and $19.2 million, respectively, because the PV-10
    amounts included in such reports do not give effect to
    additional estimated plugging and abandonment costs.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Future net revenues represent projected revenues from the sale
    of proved reserves net of production and development costs
    (including operating expenses and production taxes). Such
    calculations at December&#160;31, 2007 and 2008 are based on
    costs and prices in effect at December 31 of each year, without
    giving effect to derivative transactions, and are held constant
    throughout the life of the properties. Such calculations at
    December&#160;31, 2009 are based on costs in effect at
    December&#160;31, 2009 and the
    <FONT style="white-space: nowrap">12-month</FONT>
    unweighted arithmetic average of the
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    price for the period January 2009 through December 2009, without
    giving effect to derivative transactions, and are held constant
    throughout the life of the properties. There can be no assurance
    that the proved reserves will be produced within the periods
    indicated or that prices and costs will remain constant. There
    are numerous uncertainties inherent in estimating reserves and
    related information and different reservoir engineers often
    arrive at different estimates for the same properties.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    64
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Independent
    petroleum engineers</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our estimated reserves and related future net revenues and
    <FONT style="white-space: nowrap">PV-10</FONT> at
    December&#160;31, 2009 are based on a report prepared by
    DeGolyer and MacNaughton, our independent reserve engineers, in
    accordance with generally accepted petroleum engineering and
    evaluation principles and definitions and current guidelines
    established by the SEC. A copy of this report has been filed as
    an exhibit to the registration statement containing this
    prospectus. DeGolyer and MacNaughton is a Delaware corporation
    with offices in Dallas, Houston, Calgary and Moscow. The
    firm&#146;s more than 100 professionals include engineers,
    geologists, geophysicists, petrophysicists, and economists
    engaged in the appraisal of oil and gas properties, evaluation
    of hydrocarbon and other mineral prospects, basin evaluations,
    comprehensive field studies, and equity studies related to the
    domestic and international energy industry. These services have
    been provided for over 70&#160;years. DeGolyer and MacNaughton
    restricts its activities exclusively to consultation; it does
    not accept contingency fees, nor does it own operating interests
    in any oil, gas, or mineral properties, or securities or notes
    of clients. The firm subscribes to a code of professional
    conduct, and its employees actively support their related
    technical and professional societies. The firm is a Texas
    Registered Engineering Firm.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our estimated reserves and related future net revenues and
    <FONT style="white-space: nowrap">PV-10</FONT> at
    December&#160;31, 2007 and 2008 are based on reports prepared by
    W.D. Von Gonten&#160;&#038; Co., our independent reserve
    engineers at such dates, in accordance with generally accepted
    petroleum engineering and evaluation principles and definitions
    and guidelines established by the SEC in effect at such time. A
    copy of these reports have been filed as exhibits to the
    registration statement containing this prospectus. W.D. Von
    Gonten &#038; Co. was formed in 1995 and is located in Houston,
    Texas. The firm has a professional staff consisting of thirteen
    petroleum engineers and three geophysicists and geologists, as
    well as a financial analyst and additional technical support.
    W.D. Von Gonten &#038; Co. provides a variety of services to the
    oil and gas industry, including field studies, oil and gas
    reserve estimations, appraisals of oil and gas properties and
    reserve reports for both public and private companies. W.D. Von
    Gonten &#038; Co. is a Texas Registered Engineering Firm.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Technology
    used to establish proved reserves</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the new SEC rules, proved reserves are those quantities of
    oil and natural gas, which, by analysis of geoscience and
    engineering data, can be estimated with reasonable certainty to
    be economically producible from a given date forward, from known
    reservoirs, and under existing economic conditions, operating
    methods, and government regulations. The term &#147;reasonable
    certainty&#148; implies a high degree of confidence that the
    quantities of oil
    <FONT style="white-space: nowrap">and/or</FONT>
    natural gas actually recovered will equal or exceed the
    estimate. Reasonable certainty can be established using
    techniques that have been proved effective by actual production
    from projects in the same reservoir or an analogous reservoir or
    by other evidence using reliable technology that establishes
    reasonable certainty. Reliable technology is a grouping of one
    or more technologies (including computational methods) that has
    been field tested and has been demonstrated to provide
    reasonably certain results with consistency and repeatability in
    the formation being evaluated or in an analogous formation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In order to establish reasonable certainty with respect to our
    estimated proved reserves, DeGolyer and MacNaughton employed
    technologies that have been demonstrated to yield results with
    consistency and repeatability. The technologies and economic
    data used in the estimation of our proved reserves include, but
    are not limited to, electrical logs, radioactivity logs, core
    analyses, geologic maps and available downhole and production
    data, seismic data and well test data.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Internal
    controls over reserves estimation process</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We maintain an internal staff of petroleum engineers and
    geoscience professionals who work closely with our independent
    reserve engineers to ensure the integrity, accuracy and
    timeliness of data furnished to our independent reserve
    engineers in their reserves estimation process. Our Senior Vice
    President Asset Management is the technical person primarily
    responsible for overseeing the preparation of our reserves
    estimates. Our Senior Vice President Asset Management has over
    20&#160;years of industry experience with positions of
    increasing responsibility in engineering and evaluations and
    holds both a Bachelor of Science
</DIV>
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    <BR>
    65
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    degree and Master of Science degree in petroleum engineering.
    Our Senior Vice President Asset Management reports directly to
    our Chief Operating Officer.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Throughout each fiscal year, our technical team meets with
    representatives of our independent reserve engineers to review
    properties and discuss methods and assumptions used in
    preparation of the proved reserves estimates. While we have no
    formal committee specifically designated to review reserves
    reporting and the reserves estimation process, a preliminary
    copy of the reserve report is reviewed by our Chief Operating
    Officer with representatives of our independent reserve
    engineers and internal technical staff. Following the
    consummation of this offering, we anticipate that our audit
    committee will conduct a similar review on an annual basis.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Production,
    revenues and price history</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oil and natural gas are commodities. The price that we receive
    for the oil and natural gas we produce is largely a function of
    market supply and demand. Demand for oil and natural gas in the
    United States has increased dramatically during this decade.
    However, the current economic slowdown reduced this demand
    during the second half of 2008 and through 2009. Demand is
    impacted by general economic conditions, weather and other
    seasonal conditions, including hurricanes and tropical storms.
    Over or under supply of oil or natural gas can result in
    substantial price volatility. Historically, commodity prices
    have been volatile and we expect that volatility to continue in
    the future. A substantial or extended decline in oil or natural
    gas prices or poor drilling results could have a material
    adverse effect on our financial position, results of operations,
    cash flows, quantities of oil and natural gas reserves that may
    be economically produced and our ability to access capital
    markets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth information regarding oil and
    natural gas production, revenues and realized prices and
    production costs for the period from February&#160;26, 2007
    through December&#160;31, 2007 and for the years ended
    December&#160;31, 2008 and 2009. For additional information on
    price calculations, see information set forth in
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operation.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="65%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="8%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Operating data:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Net production volumes:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil (MBbls)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    379
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    658
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Natural gas (MMcf)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    73
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    123
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    326
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Oil equivalents (MBoe)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    171
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    400
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    712
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Average daily production (Boe/d)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,092
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,950
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Average sales prices:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil, without realized derivatives (per Bbl)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    83.96
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    88.07
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    55.32
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil, with realized derivatives(2) (per Bbl)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    77.27
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69.79
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    58.82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Natural gas (per Mcf)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10.91
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.24
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Costs and expenses (per Boe):</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Lease operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.23
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17.70
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12.21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.08
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.51
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.35
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24.47
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21.73
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23.42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    General and administrative expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18.60
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.64
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.12
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    For the period from February&#160;26, 2007 through June&#160;30,
    2007, we did not engage in oil and gas operating or producing
    activities. Average daily production includes production from
    July&#160;1, 2007 through December&#160;31, 2007.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Realized prices include realized gains or losses on cash
    settlements for our commodity derivatives, which do not qualify
    for hedge accounting.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Net production volumes for the year ended December&#160;31, 2009
    were 712&#160;MBoe, a 78% increase from net production of
    400&#160;MBoe for 2008. Our net production volumes increased
    312&#160;MBoe over 2008&#160;net production
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    66
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    volumes due to acquisitions and a successful operated and
    non-operated drilling and completion program. Our average oil
    sales prices, without the effect of realized derivatives,
    decreased $32.75 per Bbl to $55.32 per Bbl for the year ended
    December&#160;31, 2009 from $88.07 per Bbl for the year ended
    December&#160;31, 2008. Giving effect to our derivative
    transactions in both periods, our oil prices decreased only
    $10.97 per Bbl to $58.82 per Bbl for the year ended
    December&#160;31, 2009 from $69.79 per Bbl for the year ended
    December&#160;31, 2008. Our lease operating expenses decreased
    $5.49 per Boe, or 31%, to $12.21 per Boe for the year ended
    December&#160;31, 2009 from $17.70 per Boe for the year ended
    December&#160;31, 2008 due to acquisitions and our drilling
    program. The Bakken formation generally has a lower per unit
    lease operating cost than our conventional producing horizons.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Net production volumes for the year ended December&#160;31, 2008
    were 400&#160;MBoe, a 134% increase from net production of
    171&#160;MBoe for the period from February&#160;26, 2007 through
    December&#160;31, 2007. Our 2008&#160;net production volumes
    increased 229&#160;MBoe over the 2007&#160;net production
    volumes due to the initiation of our production activities on
    July&#160;1, 2007. Our average oil sales prices, without the
    effect of realized derivatives, increased $4.11 per Bbl to
    $88.07 per Bbl for the year ended December&#160;31, 2008 from
    $83.96 per Bbl for the period from February&#160;26, 2007
    through December&#160;31, 2007. Giving effect to our derivative
    transactions in both periods, our oil prices decreased $7.48 per
    Bbl to $69.79 per Bbl for the year ended December&#160;31, 2008
    from $77.27 per Bbl for the period from February&#160;26, 2007
    through December&#160;31, 2007. Our lease operating expenses
    increased $0.47 per Boe or 3% to $17.70 per Boe for the year
    ended December&#160;31, 2008 from $17.23 per Boe for the period
    from February&#160;26, 2007 through December&#160;31, 2007 due
    to limited drilling program activities, rising operating costs
    and decreasing production per well.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth information regarding our average
    daily production during the three months ended December&#160;31,
    2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="71%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="6%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="6%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
    <B>Average Daily Production for the<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Three Months Ended December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Bbls</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Mcf</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Boe</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Williston Basin:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    West Williston
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,036
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    420
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,106
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    East Nesson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,005
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    65
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,016
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Sanish
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    751
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    249
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    792
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,792
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    734
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,914
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    857
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,808
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,591
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,073
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Productive
    wells</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table presents the total gross and net productive
    wells by project area and by oil or gas completion as of
    December&#160;31, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="57%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="7%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Oil Wells</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Natural Gas Wells</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total Wells</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Williston Basin:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    West Williston
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    130
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    130
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    East Nesson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Sanish
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    62
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    62
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    235
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    235
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    235
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    260
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    72.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    67
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Gross wells are the number of wells in which a working interest
    is owned and net wells are the total of our fractional working
    interests owned in gross wells.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Acreage</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth certain information regarding the
    developed and undeveloped acreage in which we own a working
    interest as of December&#160;31, 2009 for each of our project
    areas. Acreage related to royalty, overriding royalty and other
    similar interests is excluded from this summary.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="45%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Developed Acres</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Undeveloped Acres</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total Acres</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    West Williston
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31,305
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,482
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    214,417
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    140,009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    245,722
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159,491
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    East Nesson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26,361
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,969
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    176,430
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    107,035
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    202,791
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    124,004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Sanish
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,598
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,862
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,433
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    885
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44,031
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,747
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    96,264
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44,313
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    396,280
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    247,929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    492,544
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    292,242
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,917
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    879
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,917
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    879
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    102,181
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45,192
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    396,280
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    247,929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    498,461
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    293,121
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Undeveloped
    acreage expirations</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth the number of gross and net
    undeveloped acres as of December&#160;31, 2009 that will expire
    over the next three years by project area unless production is
    established within the spacing units covering the acreage prior
    to the expiration dates:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="48%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Expiring 2010</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Expiring 2011</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Expiring 2012</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    West Williston
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,276
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,228
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,191
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    48,222
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    51,575
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,254
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    East Nesson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    68,874
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34,302
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33,372
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,272
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,693
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,367
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Sanish
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,038
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    110
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,154
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    65
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    120
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total Williston Basin
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    108,188
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45,640
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    126,717
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    59,559
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    77,388
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31,642
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    108,188
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45,640
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    126,717
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    59,559
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    77,388
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31,642
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Many of the leases comprising the acreage set forth in the table
    above will expire at the end of their respective primary terms
    unless production from the leasehold acreage has been
    established prior to such date, in which event the lease will
    remain in effect until the cessation of production in commercial
    quantities. While we may attempt to secure a new lease upon the
    expiration of certain of our acreage, there are some third-party
    leases that may become effective immediately if our leases
    expire at the end of their respective terms and production has
    not been established prior to such date. We have options to
    extend some of our leases through payment of additional lease
    bonus payments prior the expiration of the primary term of the
    leases. Our leases are mainly fee leases with three to five
    years of primary term. We believe that our leases are similar to
    our competitors fee lease terms as it relates to primary term
    and reserved royalty interests.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    68
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Drilling
    activity</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes our drilling activity for the
    period from February&#160;26, 2007 through December&#160;31,
    2007 and the years ended December&#160;31, 2008 and 2009. Gross
    wells reflect the sum of all wells in which we own an interest.
    Net wells reflect the sum of our working interests in gross
    wells.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="68%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Net</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Development wells:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Oil
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Gas
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Dry(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total development wells
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploratory wells:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Oil
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.8
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Gas
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Dry(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total exploratory wells
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total wells
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Dry wells were drilled in conventional formations other than the
    Bakken.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, there were 14&#160;gross (2.7 net)
    development wells and 5&#160;gross (1.4 net) exploratory wells
    in the process of drilling or completion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our drilling activity has increased each year since our
    inception. Exploration wells in 2008 and 2009 primarily focused
    on delineation and appraisal of the Bakken formation in our East
    Nesson and West Williston areas. Following the 2009 Kerogen
    acquisition, many operators increased the pace of development
    drilling in the Sanish project area, and as a result, we
    participated in a number of wells on a non-operated basis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2007 and 2008, we had a total of 4&#160;gross (2.9 net) wells
    that were deemed dry wells, all focused on conventional
    formations. In 2009 and in our 2010 capital plan, we have and
    expect to continue to be focused on drilling to the Bakken and
    Three Forks formations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">2010
    capital expenditure budget</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our total 2010 capital expenditure budget is $220&#160;million,
    which consists of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $134&#160;million for drilling and completing operated wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $45&#160;million for drilling and completing non-operated wells;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $15&#160;million for maintaining and expanding our leasehold
    position;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $5&#160;million for constructing infrastructure to support
    production in our core project areas;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $21&#160;million in unallocated funds which are available for
    additional drilling and leasing costs and activity.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    While we have budgeted $220&#160;million for these purposes, the
    ultimate amount of capital we will expend may fluctuate
    materially based on market conditions and the success of our
    drilling results as the year progresses. Please see
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations &#151; Liquidity and Capital
    Resources.&#148;
</DIV>
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    <BR>
    69
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    core project areas</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Williston
    Basin</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our operations are focused in the Williston Basin in North
    Dakota and Montana. While we have interests in a substantial
    number of wells in the Williston Basin that target several
    different zones, our exploration and development activities
    currently are concentrated in the Bakken formation. Our
    management team originally targeted the Williston Basin because
    of its oil prone nature, multiple, stacked producing horizons,
    substantial resource potential and management&#146;s previous
    professional history in the basin. The Williston Basin also has
    established infrastructure and access to materials and services.
    Regulatory delays are minimal in the Williston Basin due to fee
    ownership of properties, efficient state and local regulatory
    bodies and reasonable permitting requirements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The entire Williston Basin is spread across North Dakota, South
    Dakota, Montana and parts of southern Canada. The basin produces
    oil and natural gas from numerous producing horizons including,
    but not limited to, the Bakken, Three Forks, Madison and Red
    River formations. Commercial oil production activities began in
    the Williston Basin in the 1950&#146;s with the first well
    drilled in 1953. Since then, an estimated 3.8&#160;billion
    barrels have been produced from the basin, primarily from
    conventional oil accumulations, which can be found at depths
    ranging from 5,000&#160;feet to 15,000&#160;feet. The Williston
    Basin formation is now one of the most actively drilled
    unconventional oil resource plays in the United States with
    approximately 97 rigs drilling in the basin as of
    February&#160;16, 2010, including 88 in North Dakota and 9 in
    Montana. A report issued by the USGS in April 2008 classified
    these formations as the largest continuous oil accumulation ever
    assessed by it in the contiguous United States, with an
    estimated 3.65&#160;billion barrels of technically recoverable
    oil resources.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Devonian-age&#160;Bakken formation is found within the
    Williston Basin underlying portions of North Dakota and Montana
    and is comprised of three lithologic members including the upper
    shale, middle member and lower shale. The formation ranges up to
    150&#160;feet thick. The upper and lower shales are highly
    organic, thermally mature and over pressured and can act as both
    a source and reservoir for the oil. The middle member, which
    varies in composition from a silty dolomite to shalely limestone
    or sand, also serves as a reservoir and is a critical component
    for commercial production. Generally, the Bakken formation is
    found at vertical depths of 8,500 to 11,000&#160;feet.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Following the drilling of the first well in 1953, vertical well
    development of the Bakken formation occurred intermittently
    until 1987, when development of the upper shale using horizontal
    wells began to occur in the Bicentennial and Elkhorn Ranch
    areas. Development in the middle shale using horizontal wells
    began in 2001 with the discovery of the Elm Coulee Field. The
    use of horizontal drilling and improvements in completion
    technology have since expanded the development of the middle
    shale across a larger portion of the Williston Basin.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Generally, the reservoir rocks in the Bakken formation exhibit
    low porosity and permeability and require horizontal drilling
    and multi-stage fracture stimulation technology in order to
    produce economically. The fracture stimulation techniques vary
    but most commonly utilize multi-stage mechanically diverted
    stimulations using un-cemented liners and packers. Completion
    techniques have evolved as the Bakken formation has developed,
    with operators generally increasing lateral length and fracture
    stimulation stages.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Three Forks formation generally found immediately under the
    Bakken formation has also proven to contain productive reservoir
    rock that may add incremental reserves to the play. The Three
    Forks formation typically consists of interbedded dolomites and
    shale with local development of a discontinuous sandy member at
    the top, known as the Sanish sand. The Three Forks formation is
    an unconventional carbonate play. Similar to the Bakken
    formation, the Three Forks formation has recently been exploited
    primarily using horizontal drilling and advanced completion
    techniques. Drilling in the Three Forks formation began in
    mid-2008 and a number of operators are targeting this formation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our total leasehold position in the Williston Basin as of
    December&#160;31, 2009 consisted of 492,544&#160;gross and
    292,242&#160;net acres (396,280&#160;gross (247,929 net)
    undeveloped acres and 96,264&#160;gross (44,313 net) developed
    acres). Our estimated net proved reserves in the Williston Basin
    were 13.2&#160;MMBoe at December&#160;31, 2009. As of
    December&#160;31, 2009, we had 69.6&#160;net producing wells and
    net average daily production of
</DIV>
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    <BR>
    70
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    2,914&#160;MBoe/d for the three month period ending
    December&#160;31, 2009, with an average working interest of 30%.
    Our average working interest in the wells we operate is
    approximately 86%. Currently, we estimate our capital
    expenditures for 2010 will be $220&#160;million, which includes
    drilling 35&#160;gross (22.4 net) horizontal operated wells,
    numerous non-operated wells, construction of infrastructure to
    support production and leasehold acquisitions. As of
    January&#160;1, 2010, we were drilling or completing
    19&#160;gross (4.1 net) wells in the Williston Basin. We
    participated in the drilling and completion of 43&#160;gross
    wells for the year ended 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our Williston Basin activities are evaluated in three primary
    areas of operations, the West Williston area, the East Nesson
    area, and the Sanish area.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">West
    Williston</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The West Williston project area was our first area of operations
    and was established through an asset acquisition from Bill
    Barrett Corporation in June 2007. We control 245,722&#160;gross
    (159,491 net) acres in the area, primarily in Williams and
    McKenzie counties in North Dakota and Roosevelt and Richland
    counties in Montana.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We had average daily production of 1,106&#160;net Boe/d in the
    three months ended December&#160;31, 2009, 19% of which was
    produced from the Bakken formation and the remainder from other
    conventional formations. As of December&#160;31, 2009, we had an
    average working interest of 35% and operated 77% of our
    45.5&#160;net producing wells in the West Williston project
    area. Additionally, as of December&#160;31, 2009, we had
    106.5&#160;net identified drilling locations based on
    <FONT style="white-space: nowrap">1280-acre</FONT>
    spacing units, of which 83% are estimated to be operated by us,
    targeting the Bakken formation in the West Williston project
    area.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the year ended 2009, we participated in the drilling and
    completion of 5&#160;gross (1.3 net) horizontal Bakken wells in
    the West Williston project area. As of January&#160;1, 2010, we
    were participating in drilling or completion of 4&#160;gross
    (1.4 net) wells in the West Williston project area. We have
    budgeted $110&#160;million in capital expenditures in the West
    Williston project area in 2010 for the drilling and completion
    of 41&#160;gross (18.8 net) wells.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">East
    Nesson</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expanded into the East Nesson project area through a farm-in
    transaction in May 2008 with Fidelity Exploration and Production
    Company and Kerogen Resources, Inc. We subsequently increased
    our working interests in the area through the acquisitions of
    assets from Kerogen Resources, Inc. and additional working
    interests from Fidelity Exploration in June and September 2009,
    respectively. We control 202,791&#160;gross (124,004 net) acres
    in the area, primarily in Mountrail and Burke counties in North
    Dakota.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We had average daily production of 1,016&#160;net Boe/d in the
    three months ended December&#160;31, 2009, all of which was
    produced from the Bakken and Three Forks formations. As of
    December&#160;31, 2009, we had an average working interest of
    44% and operated 87% of our 19.0&#160;net producing wells in the
    East Nesson project area. Additionally, as of December&#160;31,
    2009, we had 57.0&#160;net identified drilling locations based
    almost entirely on
    <FONT style="white-space: nowrap">1280-acre</FONT>
    spacing units, 95% of which are estimated to be operated by us,
    targeting the Bakken formation in the East Nesson project area.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the year ended December&#160;31, 2009, we drilled and
    completed 12&#160;gross (4.1 net) horizontal Bakken and Three
    Forks wells in the East Nesson project area. As of
    January&#160;1, 2010, we were drilling or completing
    3&#160;gross (2.0 net) wells in the East Nesson project area. We
    have budgeted $47&#160;million in capital expenditures in the
    East Nesson project area in 2010 for the drilling and completion
    of 13&#160;gross (7.4 net) wells.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Sanish</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expanded into the Sanish project area through the acquisition
    of assets from Kerogen Resources, Inc. in June 2009. We control
    44,031&#160;gross (8,747 net) acres in the area, all of which
    are located in Mountrail county in North Dakota.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We had average daily production of 792&#160;net Boe/d in the
    three months ended December&#160;31, 2009, all of which was
    produced from the Bakken and Three Forks formations. As of
    December&#160;31, 2009, we had an average working interest of 8%
    in our 5.1&#160;net wells in the Sanish project area.
    Additionally, as of December&#160;31, 2009, we had 9.6&#160;net
    identified drilling locations targeting the Bakken and Three
    Forks formations in the Sanish project area. Our properties in
    the Sanish project area are entirely operated by other
    operators, the largest of which are Whiting Petroleum and
    Fidelity Exploration and Production Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the year ended December&#160;31, 2009, we participated in
    the drilling and completion of 26&#160;gross (2.0&#160;net)
    horizontal Bakken and Three Forks wells in the Sanish project
    area. As of January&#160;1, 2010, we were participating in the
    drilling or completion of 12&#160;gross (0.8 net) wells in the
    Sanish project area. We have budgeted $22&#160;million in
    capital expenditures in the Sanish project area in 2010 for the
    drilling and completion of 3.8&#160;net wells.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For more information on our reserves, operations and operating
    areas, see &#147;Business&#160;&#151; Our Operations.&#148;
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Other
    operating areas</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Barnett
    Shale</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As part of the Kerogen Resources asset acquisition in June 2009,
    we acquired approximately 3,000&#160;net acres with then-current
    net production of approximately 140 Boe/d in the Barnett shale
    play in Texas. In December 2009, we sold a portion of the wells
    and acreage. As of December&#160;31, 2009, our estimated proved
    reserves in the Barnett shale were approximately 111&#160;MBoe,
    representing less than 1% of our
    <FONT style="white-space: nowrap">PV-10</FONT> and
    were producing an average of 159 Boe/d for the three months
    ended December&#160;31, 2009. We do not consider the Barnett
    shale a focus area and we do not currently plan any development
    activities in the area.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Marketing
    and Major Customers</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We principally sell our oil and natural gas production to
    marketers and other purchasers that have access to nearby
    pipeline facilities. In areas where there is no practical access
    to pipelines, oil is transported by truck to storage facilities.
    Our marketing of oil and natural gas can be affected by factors
    beyond our control, the effects of which cannot be accurately
    predicted. For a description of some of these factors, see
    &#147;Risk Factors&#160;&#151; Market conditions or operational
    impediments may hinder our access to oil and natural gas markets
    or delay our production&#148; and &#147;Risk Factors&#160;&#151;
    Delays and interruptions of production from our wells due to
    marketing and transportation constraints in the Williston Basin
    could cause significant fluctuations in our realized oil and
    natural gas prices.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In an effort to improve price realizations from the sale of our
    oil and natural gas, we manage our commodities marketing
    activities in-house, which enables us to market and sell our oil
    and natural gas to a broader array of potential purchasers. Due
    to the availability of other markets and pipeline connections,
    we do not believe that the loss of any single oil or natural gas
    customer would have a material adverse effect on our results of
    operations or cash flows.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the year ended December&#160;31, 2008, sales to Tesoro
    Refining and Marketing Company and Texon L.P. accounted for
    approximately 57% and 14%, respectively, of our total sales. For
    the year ended December&#160;31, 2009, sales to Tesoro Refining
    and Marketing Company and Texon L.P. accounted for approximately
    32% and 30%, respectively, of our total sales. No other
    purchasers accounted for more than 10% of our total oil and
    natural gas sales for the year ended December&#160;31, 2008 or
    2009. We believe that the loss of any of these purchasers would
    not have a material adverse effect on our operations, as there
    are a number of alternative crude oil and natural gas purchasers
    in our producing regions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We sell our oil and condensate at the lease to a variety of
    purchasers at prevailing market prices under short-term
    contracts that normally provide for us to receive a market based
    price, which incorporates regional differentials that include
    but are not limited to transportation costs and adjustments for
    product quality.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Crude oil produced and sold in the Williston Basin has
    historically sold at a discount to the price quoted for West
    Texas Intermediate (WTI) crude oil due to transportation costs
    and takeaway capacity. In the past, there have been periods when
    this discount has substantially increased due to the production
    of oil in the area
</DIV>
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    increasing to a point that it temporarily surpasses the
    available pipeline transportation and refining capacity in the
    area. The last such period was the fall and winter of 2008 and
    2009, when the Tesoro Refining and Marketing Company North
    Dakota Sweet discount to WTI on an average monthly basis reached
    $14.80 per barrel.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Since most of our oil and natural gas production is sold under
    market based or spot market contracts, the revenues generated by
    our operations are highly dependent upon the prices of and
    demand for oil and natural gas. The price we receive for our oil
    and natural gas production depends upon numerous factors beyond
    our control, including but not limited to seasonality, weather,
    competition, availability of transportation and gathering
    capabilities, the condition of the United States economy,
    foreign imports, political conditions in other oil-producing and
    natural gas-producing countries, the actions of the Organization
    of Petroleum Exporting Countries, and domestic government
    regulation, legislation and policies. See &#147;Risk
    Factors&#151;&#160;A substantial or extended decline in oil and,
    to a lesser extent, natural gas prices may adversely affect our
    business, financial condition or results of operations and our
    ability to meet our capital expenditure obligations and
    financial commitments.&#148; Furthermore, a decrease in the
    price of oil and natural gas could have an adverse effect on the
    carrying value of our proved reserves and on our revenues,
    profitability and cash flows. See &#147;Risk
    Factors&#151;&#160;If oil and natural gas prices decrease, we
    may be required to take write-downs of the carrying values of
    our oil and natural gas properties.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although we are not currently experiencing any significant
    involuntary curtailment of our oil or natural gas production,
    market, economic, transportation and regulatory factors may in
    the future materially affect our ability to market our oil or
    natural gas production. See &#147;Risk Factors&#151;&#160;Market
    conditions or operational impediments may hinder our access to
    oil and natural gas markets or delay our production.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Title to
    Properties</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As is customary in the oil and gas industry, we initially
    conduct a preliminary review of the title to our properties on
    which we do not have proved reserves. Prior to the commencement
    of drilling operations on those properties, we conduct a
    thorough title examination and perform curative work with
    respect to significant defects. To the extent title opinions or
    other investigations reflect title defects on those properties,
    we are typically responsible for curing any title defects at our
    expense. We generally will not commence drilling operations on a
    property until we have cured any material title defects on such
    property. We have obtained title opinions on substantially all
    of our producing properties and believe that we have
    satisfactory title to our producing properties in accordance
    with standards generally accepted in the oil and gas industry.
    Prior to completing an acquisition of producing oil and natural
    gas leases, we perform title reviews on the most significant
    leases and, depending on the materiality of the properties, we
    may obtain a title opinion or review previously obtained title
    opinions. Our oil and natural gas properties are subject to
    customary royalty and other interests, liens to secure
    borrowings under our revolving credit facility, liens for
    current taxes and other burdens which we believe do not
    materially interfere with the use or affect our carrying value
    of the properties. See &#147;Risk Factors&#160;&#151; We may
    incur losses as a result of title defects in the properties in
    which we invest.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Seasonality</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Winter weather conditions and lease stipulations can limit or
    temporarily halt our drilling and producing activities and other
    oil and natural gas operations. These constraints and the
    resulting shortages or high costs could delay or temporarily
    halt our operations and materially increase our operating and
    capital costs. Such seasonal anomalies can also pose challenges
    for meeting our well drilling objectives and may increase
    competition for equipment, supplies and personnel during the
    spring and summer months, which could lead to shortages and
    increase costs or delay or temporarily halt our operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Competition</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The oil and natural gas industry is highly competitive in all
    phases. We encounter competition from other oil and natural gas
    companies in all areas of operation, including the acquisition
    of leasing options on oil and
</DIV>
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    natural gas properties to the exploration and development of
    those properties. Our competitors include major integrated oil
    and natural gas companies, numerous independent oil and natural
    gas companies, individuals and drilling and income programs.
    Many of our competitors are large, well established companies
    that have substantially larger operating staffs and greater
    capital resources than we do. Such companies may be able to pay
    more for lease options on oil and natural gas properties and
    exploratory locations and to define, evaluate, bid for and
    purchase a greater number of properties and locations than our
    financial or human resources permit. Our ability to acquire
    additional properties and to discover reserves in the future
    will depend upon our ability to evaluate and select suitable
    properties and to consummate transactions in a highly
    competitive environment. See &#147;Risk Factors&#160;&#151;
    Competition in the oil and natural gas industry is intense,
    making it more difficult for us to acquire properties, market
    oil and natural gas and secure trained personnel.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Regulation
    of the Oil and Natural Gas Industry</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our operations are substantially affected by federal, state and
    local laws and regulations. In particular, oil and natural gas
    production and related operations are, or have been, subject to
    price controls, taxes and numerous other laws and regulations.
    All of the jurisdictions in which we own or operate properties
    for oil and natural gas production have statutory provisions
    regulating the exploration for and production of oil and natural
    gas, including provisions related to permits for the drilling of
    wells, bonding requirements to drill or operate wells, the
    location of wells, the method of drilling and casing wells, the
    surface use and restoration of properties upon which wells are
    drilled, sourcing and disposal of water used in the drilling and
    completion process, and the abandonment of wells. Our operations
    are also subject to various conservation laws and regulations.
    These include regulation of the size of drilling and spacing
    units or proration units, the number of wells which may be
    drilled in an area, and the unitization or pooling of oil and
    natural gas wells, as well as regulations that generally
    prohibit the venting or flaring of natural gas and impose
    certain requirements regarding the ratability or fair
    apportionment of production from fields and individual wells.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Failure to comply with applicable laws and regulations can
    result in substantial penalties. The regulatory burden on the
    industry increases the cost of doing business and affects
    profitability. Although we believe we are in substantial
    compliance with all applicable laws and regulations, and that
    continued substantial compliance with existing requirements will
    not have a material adverse effect on our financial position,
    cash flows or results of operations, such laws and regulations
    are frequently amended or reinterpreted. Additionally, currently
    unforeseen environmental incidents may occur or past
    non-compliance with environmental laws or regulations may be
    discovered. Therefore, we are unable to predict the future costs
    or impact of compliance. Additional proposals and proceedings
    that affect the oil and natural gas industry are regularly
    considered by Congress, the states, the Federal Energy
    Regulatory Commission, or FERC, and the courts. We cannot
    predict when or whether any such proposals may become effective.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Regulation
    of transportation of oil</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Sales of crude oil, condensate and natural gas liquids are not
    currently regulated and are made at negotiated prices.
    Nevertheless, Congress could reenact price controls in the
    future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our sales of crude oil are affected by the availability, terms
    and cost of transportation. The transportation of oil in common
    carrier pipelines is also subject to rate and access regulation.
    The FERC regulates interstate oil pipeline transportation rates
    under the Interstate Commerce Act. In general, interstate oil
    pipeline rates must be cost-based, although settlement rates
    agreed to by all shippers are permitted and market based rates
    may be permitted in certain circumstances. Effective
    January&#160;1, 1995, the FERC implemented regulations
    establishing an indexing system (based on inflation) for
    transportation rates for oil that allowed for an increase or
    decrease in the cost of transporting oil to the purchaser. A
    review of these regulations by the FERC in 2000 was successfully
    challenged on appeal by an association of oil pipelines. On
    remand, the FERC in February&#160;2003 increased the index
    slightly, effective July 2001.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Intrastate oil pipeline transportation rates are subject to
    regulation by state regulatory commissions. The basis for
    intrastate oil pipeline regulation, and the degree of regulatory
    oversight and scrutiny given to intrastate oil pipeline rates,
    varies from state to state. Insofar as effective interstate and
    intrastate rates are
</DIV>
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    equally applicable to all comparable shippers, we believe that
    the regulation of oil transportation rates will not affect our
    operations in any way that is of material difference from those
    of our competitors who are similarly situated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Further, interstate and intrastate common carrier oil pipelines
    must provide service on a non-discriminatory basis. Under this
    open access standard, common carriers must offer service to all
    similarly situated shippers requesting service on the same terms
    and under the same rates. When oil pipelines operate at full
    capacity, access is governed by prorationing provisions set
    forth in the pipelines&#146; published tariffs. Accordingly, we
    believe that access to oil pipeline transportation services
    generally will be available to us to the same extent as to our
    similarly situated competitors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Regulation
    of transportation and sales of natural gas</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Historically, the transportation and sale for resale of natural
    gas in interstate commerce have been regulated by the FERC under
    the Natural Gas Act, or NGA of 1938, the Natural Gas Policy Act,
    or NGPA of 1978 and regulations issued under those Acts. In the
    past, the federal government has regulated the prices at which
    natural gas could be sold. While sales by producers of natural
    gas can currently be made at uncontrolled market prices,
    Congress could reenact price controls in the future.
    Deregulation of wellhead natural gas sales began with the
    enactment of the Natural Gas Policy Act and culminated in
    adoption of the Natural Gas Wellhead Decontrol Act which removed
    all price controls affecting wellhead sales of natural gas
    effective January&#160;1, 1993.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    FERC regulates interstate natural gas transportation rates and
    service conditions, which affects the marketing of natural gas
    that we produce, as well as the revenues we receive for sales of
    our natural gas. Since 1985, the FERC has endeavored to make
    natural gas transportation more accessible to natural gas buyers
    and sellers on an open and non-discriminatory basis. The FERC
    has stated that open access policies are necessary to improve
    the competitive structure of the interstate natural gas pipeline
    industry and to create a regulatory framework that will put
    natural gas sellers into more direct contractual relations with
    natural gas buyers by, among other things, unbundling the sale
    of natural gas from the sale of transportation and storage
    services. Beginning in 1992, the FERC issued a series of orders,
    beginning with Order No.&#160;636, to implement its open access
    policies. As a result, the interstate pipelines&#146;
    traditional role as wholesalers of natural gas has been
    eliminated and replaced by a structure under which pipelines
    provide transportation and storage service on an open access
    basis to others who buy and sell natural gas. Although the
    FERC&#146;s orders do not directly regulate natural gas
    producers, they are intended to foster increased competition
    within all phases of the natural gas industry.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2000, the FERC issued Order No.&#160;637 and subsequent
    orders, which imposed a number of additional reforms designed to
    enhance competition in natural gas markets. Among other things,
    Order No.&#160;637 revised the FERC&#146;s pricing policy by
    waiving price ceilings for short-term released capacity for a
    two-year experimental period, and effected changes in FERC
    regulations relating to scheduling procedures, capacity
    segmentation, penalties, rights of first refusal and information
    reporting. Most pipelines&#146; tariff filings to implement the
    requirements of Order No.&#160;637 have been accepted by the
    FERC and placed into effect. While most major aspects of Order
    No.&#160;637 have been upheld on judicial review, certain issues
    such as capacity segmentation and right of first refusal are
    pending further consideration by the FERC. We cannot predict
    what action FERC will take on these matters in the future, or
    whether FERC&#146;s actions will survive further judicial review.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We cannot accurately predict whether the FERC&#146;s actions
    will achieve the goal of increasing competition in markets in
    which our natural gas is sold. Additional proposals and
    proceedings that might affect the natural gas industry are
    pending before the FERC and the courts. The natural gas industry
    historically has been very heavily regulated. Therefore, we
    cannot provide any assurance that the less stringent regulatory
    approach recently established by the FERC will continue.
    However, we do not believe that any action taken will affect us
    in a way that materially differs from the way it affects other
    natural gas producers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The price at which we sell natural gas is not currently subject
    to federal rate regulation and, for the most part, is not
    subject to state regulation. However, with regard to our
    physical sales of these energy commodities,
</DIV>
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    we are required to observe anti-market manipulation laws and
    related regulations enforced by the FERC
    <FONT style="white-space: nowrap">and/or</FONT> the
    Commodity Futures Trading Commission, or the CFTC. See below the
    discussion of &#147;Other federal laws and regulations affecting
    our industry&#160;&#151; Energy Policy Act of 2005.&#148; Should
    we violate the anti-market manipulation laws and regulations, we
    could also be subject to related third party damage claims by,
    among others, sellers, royalty owners and taxing authorities. In
    addition, pursuant to Order No.&#160;704, some of our operations
    may be required to annually report to FERC, beginning
    May&#160;1, 2009. Order No.&#160;704 requires certain natural
    gas market participants to report information regarding their
    reporting of transactions to price index publishers and their
    blanket sales certificate status, as well as certain information
    regarding their wholesale, physical natural gas transactions for
    the previous calendar year depending on the volume of natural
    gas transacted. See below the discussion of &#147;Other federal
    laws and regulations affecting our industry&#160;&#151; FERC
    Market Transparency Rules.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Gathering services, which occur upstream of jurisdictional
    transmission services, are regulated by the states onshore and
    in state waters. Although its policy is still in flux, FERC has
    reclassified certain jurisdictional transmission facilities as
    non-jurisdictional gathering facilities, which has the tendency
    to increase our costs of getting gas to point of sale locations.
    State regulation of natural gas gathering facilities generally
    includes various safety, environmental and, in some
    circumstances, nondiscriminatory take requirements. Although
    such regulation has not generally been affirmatively applied by
    state agencies, natural gas gathering may receive greater
    regulatory scrutiny in the future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Intrastate natural gas transportation and facilities are also
    subject to regulation by state regulatory agencies, and certain
    transportation services provided by intrastate pipelines are
    also regulated by FERC. The basis for intrastate regulation of
    natural gas transportation and the degree of regulatory
    oversight and scrutiny given to intrastate natural gas pipeline
    rates and services varies from state to state. Insofar as such
    regulation within a particular state will generally affect all
    intrastate natural gas shippers within the state on a comparable
    basis, we believe that the regulation of similarly situated
    intrastate natural gas transportation in any states in which we
    operate and ship natural gas on an intrastate basis will not
    affect our operations in any way that is of material difference
    from those of our competitors. Like the regulation of interstate
    transportation rates, the regulation of intrastate
    transportation rates affects the marketing of natural gas that
    we produce, as well as the revenues we receive for sales of our
    natural gas.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Regulation
    of production</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The production of oil and natural gas is subject to regulation
    under a wide range of local, state and federal statutes, rules,
    orders and regulations. Federal, state and local statutes and
    regulations require permits for drilling operations, drilling
    bonds and reports concerning operations. All of the states in
    which we own and operate properties have regulations governing
    conservation matters, including provisions for the unitization
    or pooling of oil and natural gas properties, the establishment
    of maximum allowable rates of production from oil and natural
    gas wells, the regulation of well spacing, and plugging and
    abandonment of wells. The effect of these regulations is to
    limit the amount of oil and natural gas that we can produce from
    our wells and to limit the number of wells or the locations at
    which we can drill, although we can apply for exceptions to such
    regulations or to have reductions in well spacing. Moreover,
    each state generally imposes a production or severance tax with
    respect to the production and sale of oil, natural gas and
    natural gas liquids within its jurisdiction.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The failure to comply with these rules and regulations can
    result in substantial penalties. Our competitors in the oil and
    natural gas industry are subject to the same regulatory
    requirements and restrictions that affect our operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Other
    federal laws and regulations affecting our
    industry</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Energy Policy Act of 2005.</I>&#160;&#160;On August&#160;8,
    2005, President Bush signed into law the Domenici-Barton Energy
    Policy Act of 2005, or the EPAct 2005. EPAct 2005 is a
    comprehensive compilation of tax incentives, authorized
    appropriations for grants and guaranteed loans, and significant
    changes to the statutory policy that affects all segments of the
    energy industry. Among other matters, EPAct 2005 amends the NGA
    to add an
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    anti-manipulation provision which makes it unlawful for any
    entity to engage in prohibited behavior to be prescribed by
    FERC, and furthermore provides FERC with additional civil
    penalty authority. EPAct 2005 provides the FERC with the power
    to assess civil penalties of up to $1,000,000 per day for
    violations of the NGA and increases the FERC&#146;s civil
    penalty authority under the NGPA from $5,000 per violation per
    day to $1,000,000 per violation per day. The civil penalty
    provisions are applicable to entities that engage in the sale of
    natural gas for resale in interstate commerce. On
    January&#160;19, 2006, FERC issued Order No.&#160;670, a rule
    implementing the anti-manipulation provision of EPAct 2005, and
    subsequently denied rehearing. The rule makes it unlawful for
    any entity, directly or indirectly, to: (1)&#160;in connection
    with the purchase or sale of natural gas subject to the
    jurisdiction of FERC, or the purchase or sale of transportation
    services subject to the jurisdiction of FERC, to use or employ
    any device, scheme or artifice to defraud; (2)&#160;to make any
    untrue statement of material fact or omit to make any such
    statement necessary to make the statements made not misleading;
    or (3)&#160;to engage in any act or practice that operates as a
    fraud or deceit upon any person. The new anti-manipulation rules
    do not apply to activities that relate only to intrastate or
    other non-jurisdictional sales or gathering, but do apply to
    activities of gas pipelines and storage companies that provide
    interstate services, such as Section&#160;311 service, as well
    as otherwise non-jurisdictional entities to the extent the
    activities are conducted &#147;in connection with&#148; gas
    sales, purchases or transportation subject to FERC jurisdiction,
    which now includes the annual reporting requirements under Order
    704. The anti-manipulation rules and enhanced civil penalty
    authority reflect an expansion of FERC&#146;s NGA enforcement
    authority. Should we fail to comply with all applicable FERC
    administered statutes, rules, regulations, and orders, we could
    be subject to substantial penalties and fines.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>FERC Market Transparency Rules.</I>&#160;&#160;On
    December&#160;26, 2007, FERC issued a final rule on the annual
    natural gas transaction reporting requirements, as amended by
    subsequent orders on rehearing, or Order No.&#160;704. Under
    Order No.&#160;704, wholesale buyers and sellers of more than
    2.2&#160;million MMBtu of physical natural gas in the previous
    calendar year, including interstate and intrastate natural gas
    pipelines, natural gas gatherers, natural gas processors,
    natural gas marketers and natural gas producers, are required to
    report, on May 1 of each year beginning in 2009, aggregate
    volumes of natural gas purchased or sold at wholesale in the
    prior calendar year to the extent such transactions utilize,
    contribute to or may contribute to the formation of price
    indices. It is the responsibility of the reporting entity to
    determine which individual transactions should be reported based
    on the guidance of Order No.&#160;704. Order No.&#160;704 also
    requires market participants to indicate whether they report
    prices to any index publishers and, if so, whether their
    reporting complies with FERC&#146;s policy statement on price
    reporting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Additional proposals and proceedings that might affect the
    natural gas industry are pending before Congress, FERC and the
    courts. We cannot predict the ultimate impact of these or the
    above regulatory changes to our natural gas operations. We do
    not believe that we would be affected by any such action
    materially differently than similarly situated competitors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Environmental,
    Health and Safety Regulation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our exploration, development and production operations are
    subject to various federal, state and local laws and regulations
    governing health and safety, the discharge of materials into the
    environment or otherwise relating to environmental protection.
    These laws and regulations may, among other things, require the
    acquisition of permits to conduct exploration, drilling and
    production operations; govern the amounts and types of
    substances that may be released into the environment in
    connection with oil and gas drilling and production; restrict
    the way we handle or dispose of our wastes; limit or prohibit
    construction or drilling activities in sensitive areas such as
    wetlands, wilderness areas or areas inhabited by endangered or
    threatened species; require investigatory and remedial actions
    to mitigate pollution conditions caused by our operations or
    attributable to former operations; and impose obligations to
    reclaim and abandon well sites and pits. Failure to comply with
    these laws and regulations may result in the assessment of
    administrative, civil and criminal penalties, the imposition of
    remedial obligations and the issuance of orders enjoining some
    or all of our operations in affected areas.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    These laws and regulations may also restrict the rate of oil and
    natural gas production below the rate that would otherwise be
    possible. The regulatory burden on the oil and gas industry
    increases the cost of doing
</DIV>
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    business in the industry and consequently affects profitability.
    Additionally, the Congress and federal and state agencies
    frequently revise environmental, health and safety laws and
    regulations, and any changes that result in more stringent and
    costly waste handling, disposal, cleanup and remediation
    requirements for the oil and gas industry could have a
    significant impact on our operating costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The clear trend in environmental regulation is to place more
    restrictions and limitations on activities that may affect the
    environment, and thus, any changes in environmental laws and
    regulations or re-interpretation of enforcement policies that
    result in more stringent and costly waste handling, storage,
    transport, disposal, or remediation requirements could have a
    material adverse effect on our operations and financial
    position. We may be unable to pass on such increased compliance
    costs to our customers. Moreover, accidental releases or spills
    may occur in the course of our operations, and we cannot assure
    you that we will not incur significant costs and liabilities as
    a result of such releases or spills, including any third party
    claims for damage to property, natural resources or persons.
    While we believe that we are in substantial compliance with
    existing environmental laws and regulations and that continued
    compliance with current requirements would not have a material
    adverse effect on our financial condition or results of
    operations, there is no assurance that this trend will continue
    in the future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a summary of the more significant existing
    environmental, health and safety laws and regulations to which
    our business operations are subject and for which compliance may
    have a material adverse impact on our capital expenditures,
    results of operations or financial position.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Hazardous
    substances and waste</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Comprehensive Environmental Response, Compensation, and
    Liability Act, as amended, CERCLA, also known as the Superfund
    law and comparable state laws impose liability without regard to
    fault or the legality of the original conduct on certain classes
    of persons who are considered to be responsible for the release
    of a &#147;hazardous substance&#148; into the environment. These
    persons include current and prior owners or operators of the
    site where the release occurred and entities that disposed or
    arranged for the disposal of the hazardous substances found at
    the site. Under CERCLA, these &#147;responsible persons&#148;
    may be subject to joint and several, strict liability for the
    costs of cleaning up the hazardous substances that have been
    released into the environment, for damages to natural resources,
    and for the costs of certain health studies. CERCLA also
    authorizes the EPA and, in some instances, third parties to act
    in response to threats to the public health or the environment
    and to seek to recover from the responsible classes of persons
    the costs they incur. It is not uncommon for neighboring
    landowners and other third parties to file claims for personal
    injury and property damage allegedly caused by the release of
    hazardous substances or other pollutants into the environment.
    We generate materials in the course of our operations that may
    be regulated as hazardous substances.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We also generate solid and hazardous wastes that are subject to
    the requirements of the Resource Conservation and Recovery Act,
    as amended, or RCRA, and comparable state statutes. RCRA imposes
    strict requirements on the generation, storage, treatment,
    transportation and disposal of hazardous wastes. In the course
    of our operations we generate petroleum hydrocarbon wastes and
    ordinary industrial wastes that may be regulated as hazardous
    wastes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We currently own or lease, and have in the past owned or leased,
    properties that have been used for numerous years to explore and
    produce oil and natural gas. Although we have utilized operating
    and disposal practices that were standard in the industry at the
    time, hydrocarbons and wastes may have been disposed of or
    released on or under the properties owned or leased by us or on
    or under the other locations where these hydrocarbons and wastes
    have been taken for treatment or disposal. In addition, certain
    of these properties have been operated by third parties whose
    treatment and disposal or release of hydrocarbons and wastes was
    not under our control. These properties and wastes disposed
    thereon may be subject to CERCLA, RCRA and analogous state laws.
    Under these laws, we could be required to remove or remediate
    previously disposed wastes (including wastes disposed of or
    released by prior owners or operators), to clean up contaminated
    property (including contaminated groundwater) and to perform
    remedial operations to prevent future contamination.
</DIV>
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    <BR>
    78
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Air
    emissions</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Clean Air Act, as amended, and comparable state laws and
    regulations restrict the emission of air pollutants from many
    sources and also impose various monitoring and reporting
    requirements. These laws and regulations may require us to
    obtain pre-approval for the construction or modification of
    certain projects or facilities expected to produce or
    significantly increase air emissions, obtain and strictly comply
    with stringent air permit requirements or utilize specific
    equipment or technologies to control emissions. Obtaining
    permits has the potential to delay the development of oil and
    natural gas projects. While we may be required to incur certain
    capital expenditures in the next few years for air pollution
    control equipment or other air emissions-related issues, we do
    not believe that such requirements will have a material adverse
    effect on our operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Climate
    change</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In response to certain scientific studies suggesting that
    emissions of certain gases, commonly referred to as
    &#147;greenhouse gases&#148; and including carbon dioxide and
    methane, are contributing to the warming of the Earth&#146;s
    atmosphere and other climatic changes, the U.S.&#160;Congress
    has been actively considering legislation to reduce such
    emissions. On June&#160;26, 2009, the U.S.&#160;House of
    Representatives passed the American Clean Energy and Security
    Act of 2009, or ACESA, which would establish an economy-wide
    <FONT style="white-space: nowrap">cap-and-trade</FONT>
    program to reduce U.S.&#160;emissions of &#147;greenhouse
    gases&#148; including carbon dioxide and methane that may
    contribute to warming of the Earth&#146;s atmosphere and other
    climatic changes. ACESA would require a 17&#160;percent
    reduction in greenhouse gas emissions from 2005 levels by 2020
    and just over an 80&#160;percent reduction of such emissions by
    2050. Under this legislation, the EPA would issue a capped and
    steadily declining number of tradable emissions allowances to
    major sources of greenhouse gas emissions so that such sources
    could continue to emit greenhouse gases into the atmosphere.
    These allowances would be expected to escalate significantly in
    cost over time. The U.S.&#160;Senate has begun work on its own
    legislation for restricting domestic greenhouse gas emissions
    and President Obama has indicated his support of legislation to
    reduce greenhouse gas emissions through an emission allowance
    system. Although it is not possible at this time to predict when
    the Senate may act on climate change legislation or how any bill
    passed by the Senate would be reconciled with ACESA, any future
    federal laws or implementing regulations that may be adopted to
    address greenhouse gas emissions could require us to incur
    increased operating costs and could adversely affect demand for
    the oil and natural gas we produce.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, on December&#160;15, 2009, the EPA published its
    finding that emissions of greenhouse gases presented an
    endangerment to human health and the environment. These findings
    by the EPA allow the agency to proceed with the adoption and
    implementation of regulations that would restrict emissions of
    greenhouse gases under existing provisions of the federal Clean
    Air Act. Consequently, the EPA proposed two sets of regulations
    that would require a reduction in emissions of greenhouse gases
    from motor vehicles and could trigger permit review for
    greenhouse gas emissions from certain stationary sources. In
    addition, on October&#160;30, 2009, the EPA published a final
    rule requiring the reporting of greenhouse gas emissions from
    specified large greenhouse gas emission sources in the
    U.S.&#160;beginning in 2011 for emissions occurring in 2010. The
    adoption and implementation of any regulations imposing
    reporting obligations on, or limiting emissions of greenhouse
    gases from, our equipment and operations could require us to
    incur costs to reduce emissions of greenhouse gases associated
    with our operations or could adversely affect demand for the oil
    and natural gas we produce.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Even if such legislation is not adopted at the national level,
    more than one-third of the states have begun taking actions to
    control
    <FONT style="white-space: nowrap">and/or</FONT>
    reduce emissions of greenhouse gases, primarily through the
    planned development of greenhouse gas emission inventories
    <FONT style="white-space: nowrap">and/or</FONT>
    regional greenhouse gas cap and trade programs. Although most of
    the state-level initiatives have to date focused on large
    sources of greenhouse gas emissions, such as coal-fired electric
    plants, it is possible that smaller sources of emissions could
    become subject to greenhouse gas emission limitations or
    allowance purchase requirements in the future. Any one of these
    climate change regulatory and legislative initiatives could have
    a material adverse effect on our business, financial condition
    and results of operations.
</DIV>
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    <BR>
    79
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Water
    discharges</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Federal Water Pollution Control Act, as amended, or the
    Clean Water Act, and analogous state laws impose restrictions
    and strict controls regarding the discharge of pollutants into
    navigable waters. Pursuant to the Clean Water Act and analogous
    state laws, permits must be obtained to discharge pollutants
    into state waters or waters of the U.S.&#160;Any such discharge
    of pollutants into regulated waters must be performed in
    accordance with the terms of the permit issued by the EPA or the
    analogous state agency. Spill prevention, control and
    countermeasure requirements under federal law require
    appropriate containment berms and similar structures to help
    prevent the contamination of navigable waters in the event of a
    petroleum hydrocarbon tank spill, rupture or leak. In addition,
    the Clean Water Act and analogous state laws require individual
    permits or coverage under general permits for discharges of
    storm water runoff from certain types of facilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Oil Pollution Act of 1990, as amended, or the OPA, which
    amends the Clean Water Act, establishes strict liability for
    owners and operators of facilities that are the site of a
    release of oil into waters of the U.S.&#160;The OPA and its
    associated regulations impose a variety of requirements on
    responsible parties related to the prevention of oil spills and
    liability for damages resulting from such spills. A
    &#147;responsible party&#148; under the OPA includes owners and
    operators of certain onshore facilities from which a release may
    affect waters of the U.S.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Endangered
    Species Act</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The federal Endangered Species Act, as amended, the ESA,
    restricts activities that may affect endangered and threatened
    species or their habitats. While some of our facilities may be
    located in areas that are designated as habitat for endangered
    or threatened species, we believe that we are in substantial
    compliance with the ESA. However, the designation of previously
    unidentified endangered or threatened species could cause us to
    incur additional costs or become subject to operating
    restrictions or bans in the affected areas.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Employee
    health and safety</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are subject to a number of federal and state laws and
    regulations, including the federal Occupational Safety and
    Health Act, as amended the OSHA, and comparable state statutes,
    whose purpose is to protect the health and safety of workers. In
    addition, the OSHA hazard communication standard, the EPA
    community
    <FONT style="white-space: nowrap">right-to-know</FONT>
    regulations under Title&#160;III of the federal Superfund
    Amendment and Reauthorization Act and comparable state statutes
    require that information be maintained concerning hazardous
    materials used or produced in our operations and that this
    information be provided to employees, state and local government
    authorities and citizens. We believe that we are in substantial
    compliance with all applicable laws and regulations relating to
    worker health and safety.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Other
    laws</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The federal Energy Policy Act of 2005 amended the Underground
    Injection Control, or UIC, provisions of the federal Safe
    Drinking Water Act, or the SDWA, to exclude hydraulic fracturing
    from the definition of &#147;underground injection.&#148;
    However, the U.S.&#160;Senate and House of Representatives are
    currently considering bills entitled, the Fracturing
    Responsibility and Awareness of Chemicals Act, or the FRAC Act,
    to amend the SDWA to repeal this exemption. If enacted, the FRAC
    Act would amend the definition of &#147;underground
    injection&#148; in the SDWA to encompass hydraulic fracturing
    activities. If enacted, such a provision could require hydraulic
    fracturing operations to meet permitting and financial assurance
    requirements, adhere to certain construction specifications,
    fulfill monitoring, reporting, and recordkeeping obligations,
    and meet plugging and abandonment requirements. The FRAC Act
    also proposes to require the reporting and public disclosure of
    chemicals used in the fracturing process, which could make it
    easier for third parties opposing the hydraulic fracturing
    process to initiate legal proceedings based on allegations that
    specific chemicals used in the fracturing process could
    adversely affect groundwater.
</DIV>
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    <BR>
    80
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Legal
    Proceedings</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although we may, from time to time, be involved in litigation
    and claims arising out of our operations in the normal course of
    business, we are not currently a party to any material legal
    proceeding. In addition, we are not aware of any material legal
    or governmental proceedings against us, or contemplated to be
    brought against us.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Employees</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, we employed 27&#160;people,
    including four&#160;employees in geology, 11 in operations and
    engineering, four in accounting and finance and five in land.
    Our future success will depend partially on our ability to
    attract, retain and motivate qualified personnel. We are not a
    party to any collective bargaining agreements and have not
    experienced any strikes or work stoppages. We consider our
    relations with our employees to be satisfactory. From time to
    time we utilize the services of independent contractors to
    perform various field and other services.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Offices</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We currently lease approximately 13,500&#160;square feet of
    office space in Houston, Texas at 1001 Fannin, Suite&#160;202,
    where our principal offices are located. The lease for our
    Houston office expires in April 2012. We also have a lease for a
    field office in the Williston Basin in North Dakota.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Formation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We were incorporated in 2010 pursuant to the laws of the State
    of Delaware as Oasis Petroleum Inc. to become a holding company
    for Oasis Petroleum LLC after the reorganization. Oasis
    Petroleum LLC was formed as a Delaware limited liability company
    on February&#160;26, 2007 by certain members of our senior
    management team through Oasis Petroleum Management LLC and
    private equity funds managed by EnCap.
</DIV>
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    <BR>
    81
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='112'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MANAGEMENT</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Directors,
    Executive Officers and Other Key Employees</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth information regarding our
    directors and executive officers as of March&#160;1, 2010. There
    are no family relationships among any of our directors or
    executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="43%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="52%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Age</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Title</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Thomas B. Nusz
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    50
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Chairman, President and Chief Executive Officer
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Taylor L. Reid
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    47
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Director, Executive Vice President, and Chief Operating Officer
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Douglas E. Swanson, Jr.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    38
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Robert L. Zorich
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    60
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Kent O. Beers
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    60
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Senior Vice President Land
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Robert J. Candito
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    55
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Senior Vice President Exploration
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Michael H. Lou
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    35
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Senior Vice President Finance
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Roy W. Mace
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    50
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Senior Vice President, Chief Accounting Officer and Corporate
    Secretary
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    H. Brett Newton
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    43
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Senior Vice President Asset Management
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Walter S. Smithwick
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    50
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Senior Vice President Operations
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth information regarding other key
    employees as of March&#160;1, 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="43%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="52%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Age</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Title</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Steven C. Ellsberry
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    63
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Vice President and Assistant Controller
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Dean A. Gilbert
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    56
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Vice President Development Geology
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Thomas F. Hawkins
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    56
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Vice President Land and Contracts
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Robin E. Hesketh
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    51
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Vice President Operations Engineering
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Robert L. Stovall
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    52
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Vice President Geophysics
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Set forth below is the description of the backgrounds of our
    directors, executive officers and other key employees.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Thomas B. Nusz </I>has served as our Director, President and
    Chief Executive Officer (or in similar capacities) since our
    inception in March 2007 and has 28&#160;years of experience in
    the oil and gas industry. Mr.&#160;Nusz will become our Chairman
    upon the completion of this offering. From April 2006 to
    February 2007, Mr.&#160;Nusz managed his personal investments,
    developed the business plan for Oasis Petroleum and secured
    funding for the company. He was previously a Vice President with
    Burlington Resources, Inc., a formerly publicly traded oil and
    gas exploration and production company or, together with its
    predecessors, Burlington, and served as President International
    Division (North Africa, Northwest Europe, Latin America and
    China) from January 2004 to March 2006, as Vice President
    Acquisitions and Divestitures from October 2000 to December 2003
    and as Vice President Strategic Planning and Engineering from
    July 1998 to September 2000 and Chief Engineer for substantially
    all of such period. He was instrumental in Burlington&#146;s
    expansion into the Western Canadian Sedimentary Basin from 1999
    to 2002. From September 1985 to June 1998, Mr.&#160;Nusz held
    various operations and managerial positions with Burlington in
    several regions of the United States, including the Permian
    Basin, the San&#160;Juan Basin, the Black Warrior Basin, the
    Anadarko Basin, onshore Gulf Coast and Gulf of Mexico.
    Mr.&#160;Nusz was an engineer with Mobil Oil Corporation and for
    Superior Oil Company from June 1982 to August 1985. He is a
    current member of the National Petroleum Council, an advisory
    committee to the Secretary of Energy of the United States.
    Mr.&#160;Nusz holds a Bachelor of Science in Petroleum
    Engineering from Mississippi State University.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Taylor L. Reid </I>has served as our Director, Executive Vice
    President and Chief Operating Officer (or in similar capacities)
    since our inception in March 2007 and has 24&#160;years of
    experience in the oil and gas industry. From November 2006 to
    February 2007, Mr.&#160;Reid worked with Mr. Nusz to form the
    business plan
</DIV>
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    82
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    for Oasis Petroleum and secure funding for the company. He
    previously served as Asset Manager Permian and Panhandle
    Operations with ConocoPhillips from April 2006 to October 2006.
    Prior to joining ConocoPhillips, he served as General Manager
    Latin America and Asia Operations with Burlington from March
    2004 to March 2006 and as General Manager Corporate Acquisitions
    and Divestitures from July 1998 to February 2004. From March
    1986 to June 1998, Mr.&#160;Reid held various operations and
    managerial positions with Burlington in several regions of the
    continental United States, including the Permian Basin, the
    Williston Basin and the Anadarko Basin. He was instrumental in
    Burlington&#146;s expansion into the Western Canadian
    Sedimentary Basin from 1999 to 2002. Mr.&#160;Reid holds a
    Bachelor of Science in Petroleum Engineering from Stanford
    University.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Douglas E. Swanson,&#160;Jr.</I> has served as our Director
    since our inception in March 2007. Mr.&#160;Swanson has served
    as Managing Director of EnCap Investments L.P., an investment
    management firm, since 1999. Prior to his position at EnCap, he
    was in the corporate lending division of Frost National Bank
    from 1995 to 1997, specializing in energy-related service
    companies, and was a financial analyst in the corporate lending
    group of Southwest Bank of Texas from 1994 to 1995.
    Mr.&#160;Swanson has extensive industry experience serving on
    numerous boards of private oil and gas exploration and
    production companies over his 11-year history with EnCap and is
    a member of the Independent Petroleum Association of America and
    the Texas Independent Producers&#160;&#038; Royalty Owners
    Association. Mr.&#160;Swanson holds a Bachelor of Arts in
    Economics and a Masters of Business Administration, both from
    the University of Texas at Austin.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Robert L. Zorich </I>has served as our Director since our
    inception in March 2007. Mr.&#160;Zorich is a Principal of EnCap
    Investments L.P., an investment management firm which he
    co-founded in 1988. Prior to the formation of EnCap,
    Mr.&#160;Zorich was a Senior Vice President of
    Trust&#160;Company of the West, a large, privately-held pension
    fund manager, from 1986 to 1988. Prior to joining
    Trust&#160;Company of the West, Mr.&#160;Zorich co-founded MAZE
    Exploration, Inc., a company actively involved in oil and gas
    exploration, development and reserve acquisitions, serving as
    its Co-Chief Executive Officer from 1981 to 1986.
    Mr.&#160;Zorich began his career at Republic National Bank of
    Dallas where he worked from 1974 to 1981. He ultimately served
    as Vice President and Division&#160;Manager in the Energy
    Department. He serves on the board of directors of several EnCap
    portfolio companies, is also a member of the board of directors
    of Enerplus Resources Fund (NYSE: ERF) and was previously a
    director of TODCO (NYSE: THE). He is a member of the Independent
    Petroleum Association of America and Texas Independent Producers
    and Royalty Owners Association. Mr.&#160;Zorich holds a Bachelor
    of Arts in Economics from the University of California at
    Santa&#160;Barbara and a Masters Degree in International
    Management from the American Graduate School of International
    Management.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Kent O. Beers </I>has served as our Senior Vice President
    Land (or in similar capacities) since August 2007 and has
    34&#160;years of experience in the oil and gas industry. He
    previously served as Commercial Director International with
    ConocoPhillips from March 2006 to July 2006. Prior to joining
    ConocoPhillips, Mr.&#160;Beers held various managerial positions
    in the Commercial and Business Development divisions of
    Burlington from June 1997 to March 2006 and was Manager
    Corporate Divestitures of Burlington from June 1994 to May 1997.
    From June 1982 to May 1994, Mr.&#160;Beers held various land
    managerial positions with Burlington in the Rocky Mountain
    Region and the Williston Basin. Prior to joining Burlington, he
    was a Land Manager of NuCorp Energy Inc. from 1980 to 1982 and
    Regional Land Manager of Hunt Energy Corporation from 1976 to
    1980. Mr.&#160;Beers holds a Bachelor of Science in Business
    Administration from Montana State University.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Robert J. Candito </I>has served as our Senior Vice President
    Exploration (or in similar capacities) since our inception in
    March 2007 and has 32&#160;years of experience in the oil and
    gas industry. He previously served as Principal Geologist with
    ConocoPhillips from April 2006 to August 2007. Prior to joining
    ConocoPhillips, Mr.&#160;Candito was a Senior Geological Advisor
    with Burlington from February 1995 to March 2006. At Burlington
    he held various positions in both exploration and development
    operations with Burlington in several regions of the continental
    United States, including the Gulf Coast, the Rocky Mountains and
    the Anadarko Basin. From January 1999 through March 2006,
    Mr.&#160;Candito worked for Burlington&#146;s International
    Division on South American projects. Prior to joining
    Burlington, Mr.&#160;Candito worked for several independent
    operators in both the Rocky Mountain and Gulf Coast regions.
    Mr.&#160;Candito holds a Bachelor of Science in Geology from
    Bridgewater State College and a Master of Science in
    Geochemistry from the Colorado School of Mines.
</DIV>
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    <BR>
    83
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Michael H. Lou </I>has served as our Senior Vice
    President&#160;Finance (or similar capacities) since September
    2009 and has 13&#160;years of experience in the oil and gas
    industry. Prior to joining us, Mr.&#160;Lou was an independent
    contractor from January 2009 to August 2009. From February 2008
    to December 2008, he served as the Chief Financial Officer of
    Giant Energy Ltd., a private oil and gas management company,
    from July 2006 to December 2008 he served as Chief Financial
    Officer of XXL Energy Corp., a publicly listed Canadian oil and
    gas company, and from August 2008 to December 2008, he served as
    Vice President&#160; Finance of Warrior Energy N.V., a publicly
    listed Canadian oil and gas company. From October 2005 to July
    2006, Mr.&#160;Lou was a Director for Macquarie Investment Bank.
    Prior to joining Macquarie, Mr.&#160;Lou was a Vice President
    for First Albany Investment Banking from 2004 to 2006. From 1999
    to 2004, Mr.&#160;Lou held positions of increasing
    responsibility, most recently as a Vice President, for Bank of
    America&#146;s investment banking group. From 1997 to 1999,
    Mr.&#160;Lou was an analyst for Merrill Lynch&#146;s investment
    banking group. Mr.&#160;Lou holds a Bachelor of Science in
    Electrical Engineering from Southern Methodist University.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Roy W. Mace </I>has served as our Senior Vice President,
    Chief Accounting Officer and Corporate Secretary (or in similar
    capacities) since our inception in March 2007 and has
    28&#160;years of experience in the oil and gas industry. He
    previously served as Business Process Improvement&#160;&#038;
    Integration Advisor with ConocoPhillips from March 2006 to March
    2007. Prior to joining ConocoPhillips, Mr.&#160;Mace was a
    Senior Accounting Manager with Burlington from June 1999 to
    March 2006. Upon starting his career with Burlington as a Senior
    Corporate Auditor, Mr.&#160;Mace advanced into various
    managerial accounting positions at Burlington during the period
    from August 1986 to June 1999 . Prior to joining Burlington,
    Mr.&#160;Mace worked as an Assistant Controller for Permian
    Tank&#160;&#038; Manufacturing from June&#160;1984 to August
    1986 and as a staff accountant for KPMG from July 1982 to June
    1984. Mr.&#160;Mace holds a Bachelor of Business Administration
    and Accounting from Eastern New Mexico University and is a
    licensed Certified Public Accountant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>H.&#160;Brett Newton </I>has served as our Senior Vice
    President&#160;Asset Management (or in similar capacities) since
    October 2007 and has 21&#160;years of experience in the oil and
    gas industry. He previously served as Business Development and
    Partner Operations Manager&#160; Algeria with ConocoPhillips
    from April 2006 to September 2007. Prior to joining
    ConocoPhillips, Mr.&#160;Newton was Asset Manager&#160; North
    Africa with Burlington from May 2004 to March 2006 and held
    various engineering positions with Burlington from June 1994 to
    April 2004. Prior to joining Burlington, Mr.&#160;Newton worked
    for Chevron from January 1989 to June 1994. Mr.&#160;Newton has
    worked projects in several regions of the world, including the
    Berkine Basin (Algeria), the Permian Basin, the Green River
    Basin and the Williston Basin. Mr.&#160;Newton holds a Bachelor
    of Science from Texas A&#038;M University and a Master of
    Science from the University of Texas at Austin, both in
    Petroleum Engineering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Walter S. Smithwick </I>has served as our Senior Vice
    President&#160;Operations (or in similar capacities) since
    October 2007 and has 26&#160;years of experience in the oil and
    gas industry. He previously served as South Texas Operations
    Manager&#160; Lobo Field with ConocoPhillips from April 2006 to
    June 2007. Prior to joining ConocoPhillips, Mr.&#160;Smithwick
    was Asset Manager San&#160;Juan Basin with Burlington from May
    2000 to April 2006 and Drilling
    Manager&#160;/&#160;Superintendent from October 1994 to May
    2000. From 1986 to 1994, Mr.&#160;Smithwick held various
    operations and managerial positions with Burlington in several
    regions of the continental United States, including the
    San&#160;Juan Basin, Permian Basin and the Anadarko Basin. Prior
    to joining Burlington, Mr.&#160;Smithwick worked as a TC Unit
    Manager for Schlumberger from 1979 to 1981 and worked for
    Harkins Drilling Company in 1978. Mr.&#160;Smithwick holds a
    Bachelor of Science in Petroleum Engineering from Texas A&#038;M
    University.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Steven C. Ellsberry </I>has served as our Vice President and
    Assistant Controller (or in similar capacities) since September
    2007 and has 26&#160;years of experience in the oil and gas
    industry. Prior to joining us, Mr.&#160;Ellsberry was a
    consultant to energy businesses evaluating new acquisitions,
    integrating or divesting of oil and gas properties, building
    economic models for large gas gathering systems and assisting in
    our startup. At Burlington, Mr.&#160;Ellsberry had over
    20&#160;years of mergers and acquisitions experience responsible
    for due diligence, financial evaluations and back office
    integration. In addition, Mr.&#160;Ellsberry managed accounting,
    internal audit and information technology functions for
    Burlington. Mr.&#160;Ellsberry was a licensed Certified Public
    Accountant from 1988 to 2007 and holds a Bachelor of Science in
    Electrical Engineering from the University of Texas in Austin.
</DIV>
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    84
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Dean A. Gilbert </I>has served as our Vice President
    Development Geology (or in similar capacities) since September
    2007. Prior to joining us, Mr.&#160;Gilbert was associated with
    The Scotia Group as Geoscience Manager from January 2001 to
    September 2007. In that capacity, he was involved in a variety
    of projects in the United States, both continental and offshore,
    as well as internationally. International areas included Mexico,
    South America, Indonesia and offshore West Africa. Prior to
    joining The Scotia Group, Mr.&#160;Gilbert held various
    geological positions with Burlington, Louisiana Land and
    Exploration and Union Texas Petroleum. He has over 33&#160;years
    of geological and geophysical experience in the oil and gas
    industry. Mr.&#160;Gilbert holds a Bachelor of Arts degree in
    geology from Rice University in Houston.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Thomas F. Hawkins </I>has served as our Vice President Land
    and Contracts (or in similar capacities) since March 2009 and
    has 32&#160;years of experience in the oil and gas industry.
    Mr.&#160;Hawkins retired from ConocoPhillips Company in February
    2009 after spending 31&#160;years with ConocoPhillips and
    Burlington (which ConocoPhillips acquired in 2006). During that
    time, Mr.&#160;Hawkins held various operations and managerial
    positions in the Land, Marketing, Planning and Corporate
    Acquisitions and Divestitures groups. Mr.&#160;Hawkins has
    worked in several major regions in the continental United
    States, including the San&#160;Juan Basin in New Mexico, the
    Williston Basin and the Austin Chalk&#160;/&#160;Wilcox Trends
    in South Texas. Mr.&#160;Hawkins holds a Bachelor of Business
    Administration in Finance from the University of Texas at
    El&#160;Paso.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Robin E. Hesketh </I>has served as our Vice President
    Operations Engineering (or in similar capacities) since April
    2007 and has 29&#160;years of experience in the oil and gas
    industry. Prior to joining us, he was a Principal Engineer with
    ConocoPhillips. He was the Drilling and Completions Manager with
    Burlington China from June 2004 to March 2006, and an Advisor
    Engineer with Burlington from 1993 to 2004 working in Corporate
    Acquisitions and Operations positions in various divisions.
    Prior to that, Mr.&#160;Hesketh worked in Operations engineering
    around the globe for British Gas and Hamilton Brothers
    Oil&#160;&#038; Gas. He started his career with Sohio Alaska
    Petroleum Company working as a field engineer in Prudhoe Bay
    Alaska. Mr.&#160;Hesketh holds a Bachelor of Science in
    Petroleum Engineering from the Colorado School of Mines.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Robert L. Stovall </I>has served as our Vice President
    Geophysics (or in similar capacities) since inception in March
    2007 and has 27&#160;years of experience in the oil and gas
    industry working both exploration and development projects.
    Prior to joining us, Mr.&#160;Stovall was Senior Geophysical
    Advisor at Apache Corporation in International New Ventures from
    September 2006 to March 2007. Mr.&#160;Stovall spent
    11&#160;years at Burlington with his last assignment being
    Senior Geophysical Advisor evaluating exploration, development,
    and new ventures in several Latin America countries, West Africa
    and China. Prior to that assignment, Mr.&#160;Stovall was
    responsible for Burlington projects in the Gulf of Mexico and
    the Anadarko Basin. Before joining Burlington in 2006,
    Mr.&#160;Stovall spent 12&#160;years at Conoco as a geophysicist
    covering projects in the Former Soviet Union, the North Sea,
    Australia, West Africa, and in the Portfolio Management Group.
    Mr.&#160;Stovall has a Master of Science degree from Virginia
    Tech and a Bachelor of Science Degree from the University of
    Montana. He is also a Certified Professional Geophysicist.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Board of
    Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors currently consists of four members,
    including our President and Chief Executive Officer, our
    Executive Vice President and Chief Operating Officer, and two
    members designated by EnCap, which together with its affiliates
    controls a majority of the voting power of our outstanding
    common stock. Each of our current directors has significant
    industry experience.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the time we complete this offering, we expect to have one new
    independent director who will serve as chairman of our audit
    committee. We expect to add another independent director to our
    board of directors and audit committee within 90&#160;days after
    the completion of this offering and a third independent director
    within one year after the completion of this offering. We also
    expect that our board will review the independence of our
    current directors using the independence standards of the NYSE
    and, based on this review, determine that Messrs.&#160;Swanson
    and Zorich are independent within the meaning of the NYSE
    listing standards currently in effect. As a result, we expect
    that our board of directors will consist of seven members within
    one year after the completion of this offering, five of whom
    will be independent. Because OAS Holdco will own a majority of
    our outstanding common stock following the completion of this
    offering, we will be a &#147;controlled company&#148; as that
    term is set forth in Section&#160;303A of the NYSE Listed
    Company Manual. Under the NYSE rules, a
</DIV>
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    <BR>
    85
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    &#147;controlled company&#148; may elect not to comply with
    certain NYSE corporate governance requirements, including:
    (1)&#160;the requirement that a majority of our board of
    directors consist of independent directors, (2)&#160;the
    requirement that our nominating and corporate governance
    committee be composed entirely of independent directors with a
    written charter addressing the committee&#146;s purpose and
    responsibilities, and (3)&#160;the requirement that our
    compensation committee be composed entirely of independent
    directors with a written charter addressing the committee&#146;s
    purpose and responsibilities. While these requirements will not
    apply to us as long as we remain a &#147;controlled
    company,&#148; as a result of the independent directors that we
    expect to add prior to and within one year following the
    completion of this offering, we expect that our board of
    directors will nonetheless consist of a majority of independent
    directors and that our nominating and corporate governance
    committee and compensation committee will consist entirely of
    independent directors. We also expect that our nominating and
    corporate governance committee and compensation committee will
    each have a written charter addressing such committee&#146;s
    purpose and responsibilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In evaluating director candidates, we will assess whether a
    candidate possesses the integrity, judgment, knowledge,
    experience, skills and expertise that are likely to enhance the
    board&#146;s ability to manage and direct the affairs and
    business of the company, including, when applicable, to enhance
    the ability of committees of the board to fulfill their duties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Following the completion of this offering, our directors will be
    divided into three classes serving staggered three-year terms.
    Class&#160;I, Class&#160;II and Class&#160;III directors will
    serve until our annual meetings of stockholders in 2011, 2012
    and 2013, respectively. The Class&#160;I directors are
    Messrs.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    the Class&#160;II directors are
    Messrs.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    and the Class&#160;III directors are
    Messrs.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;.
    At each annual meeting of stockholders held after the initial
    classification, directors will be elected to succeed the class
    of directors whose terms have expired. This classification of
    our board of directors could have the effect of increasing the
    length of time necessary to change the composition of a majority
    of the board of directors. In general, at least two annual
    meetings of stockholders will be necessary for stockholders to
    effect a change in a majority of the members of the board of
    directors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Committees
    of the Board of Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon the conclusion of this offering, we intend to have an audit
    committee, compensation committee and nominating and governance
    committee at our board of directors, and may have such other
    committees as the board of directors shall determine from time
    to time. Each of the standing committees of the board of
    directors will have the composition and responsibilities
    described below.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Audit
    Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will establish an audit committee prior to completion of this
    offering. We anticipate that the audit committee will consist of
    three directors, each of whom will be independent under the
    rules of the SEC. SEC rules also require that a public company
    disclose whether or not its audit committee has an &#147;audit
    committee financial expert&#148; as a member. An &#147;audit
    committee financial expert&#148; is defined as a person who,
    based on his or her experience, possesses the attributes
    outlined in such rules. We anticipate that at least one of our
    independent directors will satisfy the definition of &#147;audit
    committee financial expert.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This committee will oversee, review, act on and report on
    various auditing and accounting matters to our board of
    directors, including: the selection of our independent
    accountants, the scope of our annual audits, fees to be paid to
    the independent accountants, the performance of our independent
    accountants and our accounting practices. In addition, the audit
    committee will oversee our compliance programs relating to legal
    and regulatory requirements. Upon formation of the audit
    committee, we expect to adopt an audit committee charter
    defining the committee&#146;s primary duties in a manner
    consistent with the rules of the SEC and NYSE or market
    standards.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Compensation
    Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will establish a compensation committee prior to completion
    of this offering. We anticipate that the compensation committee
    will consist of three directors, each of whom will be
    &#147;independent&#148; under the rules
</DIV>
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    <BR>
    86
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    of the SEC. This committee will establish salaries, incentives
    and other forms of compensation for officers and other
    employees. Our compensation committee will also administer our
    incentive compensation and benefit plans. Upon formation of the
    compensation committee, we expect to adopt a compensation
    committee charter defining the committee&#146;s primary duties
    in a manner consistent with the rules of the SEC and NYSE or
    market standards.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Nominating
    and Corporate Governance Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will establish a nominating and corporate governance
    committee shortly after completion of this offering. We
    anticipate that the nominating and corporate governance
    committee will consist of three directors. This committee will
    identify, evaluate and recommend qualified nominees to serve on
    our board of directors, develop and oversee our internal
    corporate governance processes and maintain a management
    succession plan. Upon formation of the nominating and corporate
    governance committee, we expect to adopt a nominating and
    corporate governance committee charter defining the
    committee&#146;s primary duties in a manner consistent with the
    rules of the SEC and NYSE or market standards.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Compensation
    Committee Interlocks and Insider Participation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    None of our officers or employees will be members of the
    compensation committee. None of our executive officers serve on
    the board of directors or compensation committee of a company
    that has an executive officer that serves on our board or
    compensation committee. No member of our board is an executive
    officer of a company in which one of our executive officers
    serves as a member of the board of directors or compensation
    committee of that company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the extent any members of our compensation committee and
    affiliates of theirs have participated in transactions with us,
    a description of those transactions is described in
    &#147;Certain Relationships and Related Party Transactions.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Code of
    Business Conduct and Ethics</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors will adopt a code of business conduct and
    ethics applicable to our employees, directors and officers, in
    accordance with applicable U.S.&#160;federal securities laws and
    the corporate governance rules of the NYSE. Any waiver of this
    code may be made only by our board of directors and will be
    promptly disclosed as required by applicable U.S.&#160;federal
    securities laws and the corporate governance rules of the NYSE.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Corporate
    Governance Guidelines</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors will adopt corporate governance
    guidelines in accordance with the corporate governance rules of
    the NYSE.
</DIV>
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    <BR>
    87
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='113'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">EXECUTIVE
    COMPENSATION AND OTHER INFORMATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Compensation
    Discussion and Analysis</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This compensation discussion and analysis, or CD&#038;A,
    provides information about our compensation objectives and
    policies for our principal executive officer, our principal
    financial officer and our other three most highly-compensated
    executive officers, and is intended to place in perspective the
    information contained in the executive compensation tables that
    follow this discussion. This CD&#038;A provides a general
    description of our compensation program and specific information
    about its various components.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Throughout this discussion, the following individuals are
    referred to as the &#147;Named Executive Officers&#148; and are
    included in the Summary Compensation Table:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Thomas B. Nusz, Chairman, President and Chief Executive Officer;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Taylor L. Reid, Executive Vice President and Chief Operating
    Officer;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Roy W. Mace, Senior Vice President, Chief Accounting Officer and
    Corporate Secretary;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Kent O. Beers, Senior Vice President Land;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Walter S. Smithwick, Senior Vice President Operations.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although this CD&#038;A focuses on the information in the tables
    below and related footnotes, as well as the supplemental
    narratives relating to the last completed fiscal year, we also
    describe compensation actions taken before or after the last
    completed fiscal year to the extent such discussion enhances the
    understanding of our executive compensation disclosure.
    Contemporaneous with this offering, we anticipate making
    adjustments to our compensatory practices to be utilized in 2010
    and later years that we believe will be more appropriate for a
    company with public stockholders. This CD&#038;A discusses the
    compensatory practices in place during 2009 and highlights
    changes we will implement upon the consummation of this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Compensation
    Program Philosophy and Objectives</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our future success and the ability to create long-term value for
    our stockholder depends on our ability to attract, retain and
    motivate the most qualified individuals in the oil and gas
    industry. Our compensation program is designed to reward
    performance that supports our long-term strategy and achievement
    of our short-term goals. We believe that compensation should:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    help to attract and retain the most qualified individuals in the
    oil and gas industry by being competitive with compensation paid
    to persons having similar responsibilities and duties in other
    companies in the same and closely related industries;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    align the interests of the individual with those of our
    stockholders and long-term value creation;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be directly tied to the attainment of our annual performance
    targets and reflect individual contribution thereto;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    pay for performance, whereby an individual&#146;s total
    compensation is heavily influenced by the company&#146;s and
    individual&#146;s performance;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reflect the unique qualifications, skills, experience and
    responsibilities of each individual.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although not formally adopted as objectives in 2009 and prior
    years, the preceding objectives are consistent with the informal
    objectives we have employed historically.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Setting
    Executive Officer Compensation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    From our inception in 2007 through 2009, the base compensation
    of our Named Executive Officers has remained relatively
    unchanged and was based largely on each executive officer&#146;s
    base compensation level at prior positions, although some
    adjustments were made as we deemed necessary to maintain
    internal equity with respect to the compensation of all
    executive officers.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    88
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For 2010, Mr.&#160;Nusz, our Chief Executive Officer, and
    Mr.&#160;Reid, our Chief Operating Officer, have together
    reviewed our Named Executive Officers&#146; current compensation
    and have made a recommendation to our board of directors on
    overall compensation structure and individual compensation
    levels for each executive officer, including themselves, to be
    effective contemporaneous with this offering. Their
    recommendation was made based on the experience of Mr.&#160;Nusz
    and Mr.&#160;Reid in managing executives and establishing
    compensation, as well as the use of a peer group comparison. See
    &#147;&#151;&#160;Benchmarking and Peer Group&#148; below. Our
    board of directors has approved this recommendation, which will
    become effective upon the consummation of this offering.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors does not currently have a separate
    Compensation Committee due to the size of our existing board of
    directors and the lack of independent directors. However, upon
    consummation of this offering, our board of directors will have
    a Compensation Committee that will determine the compensation of
    our Named Executive Officers for future years. We currently
    expect that our Compensation Committee will generally target the
    50th percentile for base salary and will target a higher 75th
    percentile for total compensation, subject to target performance
    metrics being satisfied. Although our Compensation Committee
    will review survey information as a frame of reference,
    ultimately the compensation decisions will be qualitative, not
    quantitative, and will take into consideration in material part
    factors such as the age of the data in the survey, the
    particular officer&#146;s contribution to our financial
    performance and condition, as well as such officer&#146;s
    qualifications, skills, experience and responsibilities. We
    expect outside factors to be considered as well, such as
    industry shortages of qualified employees for such positions,
    recent experience in the marketplace, and the elapsed time
    between the surveys used and our compensation decisions are
    made. Therefore, we expect that the final base salary of a
    particular officer may be greater or less than the 50th
    percentile and targeted total compensation may be greater or
    less than the
    75<SUP style="font-size: 85%; vertical-align: top">th</SUP>

    percentile.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Benchmarking and Peer Group.</I>&#160;&#160;Historically,
    neither our board of directors nor our management has used peer
    group analysis or benchmarking for executive compensation
    purposes.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For 2010, our Chief Executive Officer, Chief Operating Officer,
    and Senior Vice President Finance met with representatives from
    Longnecker&#160;&#038; Associates, our compensation consultant,
    to select a group of companies that they consider a &#147;peer
    group&#148; for executive compensation analysis purposes. This
    peer group was then used for purposes of developing the
    recommendations presented to our board of directors for
    compensation packages that will become applicable to our Named
    Executive Officers upon the closing of this offering. The oil
    and gas companies that comprise this peer group were selected
    primarily because they (i)&#160;have similar annual revenue,
    assets and market capitalization as us and (ii)&#160;potentially
    compete with us for executive talent. Longnecker&#160;&#038;
    Associates compiled compensation data for the peer group from a
    variety of sources, including proxy statements and other
    publicly filed documents. Longnecker&#160;&#038; Associates also
    provided published survey compensation data from multiple
    sources. This compensation data was then used to compare the
    compensation of our Named Executive Officers to comparably
    titled persons at companies within our peer group and in the
    survey data, generally targeting base salaries for our Named
    Executive Officers which are at the
    50<SUP style="font-size: 85%; vertical-align: top">th</SUP>

    percentile of our peer group, and targeting annual cash and
    long-term incentives so that our Named Executive Officers will
    have the opportunity to realize total compensation at the
    75<SUP style="font-size: 85%; vertical-align: top">th</SUP>

    percentile of our peer group based on both company and
    individual performance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The 2010 peer group for compensation purposes consists of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="4%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="45%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="45%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    &#149;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Abraxas Petroleum Corporation
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    &#149;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    GeoMet, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    &#149;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Approach Resources, Inc.&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    &#149;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    GMX Resources, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    &#149;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Arena Resources, Inc.&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    &#149;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Goodrich Petroleum Corporation
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    &#149;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Brigham Exploration Company
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    &#149;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Gulfport Energy Corporation
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    &#149;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Carrizo Oil and Gas, Inc.&#160;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    &#149;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Panhandle Oil &#038; Gas, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    &#149;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Crimson Exploration, Inc
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    &#149;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    RAM Energy Resources, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    &#149;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Delta Petroleum Corporation
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    &#149;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Rex Energy Corporation
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    &#149;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Double Eagle Petroleum Company
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    89
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Beginning in 2011, we anticipate that our Compensation Committee
    will review and re-determine annually the composition of our
    peer group so that the peer group will continue to consist of
    oil and gas exploration and production companies (i)&#160;with
    annual revenue, assets and market capitalization similar to us
    and (ii)&#160;who potentially compete with us for executive
    talent.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Role of the Compensation Consultant.</I>&#160;&#160;From our
    inception through 2009, neither management nor our board of
    directors engaged a compensation consultant. For 2010, the
    company retained, independent of our board of directors,
    Longnecker&#160;&#038; Associates as an independent compensation
    consultant to assist us in developing the non-employee director
    and executive compensation program to be implemented
    contemporaneously with this offering. Representatives from
    Longnecker&#160;&#038; Associates have met with our board of
    directors and have advised the board of directors with regard to
    general trends in director and executive compensation matters,
    including (i)&#160;competitive benchmarking; (ii)&#160;incentive
    plan design; (iii)&#160;peer group selection; and
    (iv)&#160;other matters relating to executive compensation. In
    addition, Longnecker&#160;&#038; Associates has provided our
    management with survey compensation data regarding our peer
    group. We anticipate that the charter of our Compensation
    Committee will grant the committee the sole authority to retain,
    at our expense, outside consultants or experts to assist it in
    its duties.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Elements
    of our Compensation and Why We Pay Each Element</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    From our inception through 2009, our compensation program
    consisted of base salary and an annual performance-based cash
    bonus only. In addition, our Named Executive Officers and
    certain other employees have had the opportunity to invest their
    own funds in Oasis Petroleum Management LLC, which owns an
    interest in Oasis Petroleum LLC. See &#147;Corporate
    Reorganization&#160;&#151; Oasis Management LLC.&#148; Following
    the consummation of this offering, we expect that the
    compensation program for our Named Executive Officers will be
    comprised of four elements: base salary, annual
    performance-based cash incentive awards, long-term equity-based
    compensation and other employee benefits.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Base Salary.</I>&#160;&#160;Base salary is the fixed annual
    compensation we pay to each Named Executive Officer for
    performing specific job responsibilities. It represents the
    minimum income a Named Executive Officer may receive in any
    year. Contemporaneous with the consummation of this offering, we
    will implement salary increases for our Named Executive Officers
    in order to bring their base salaries in line with similarly
    titled executives at other companies within our peer group. For
    Named Executive Officers other than Messrs.&#160;Nusz and Reid,
    the salary increases are fairly small and ranged up to 11.4% of
    their fiscal 2009 salary. Mr.&#160;Beers will not receive a
    salary increase. Because of the increased responsibility of
    Messrs.&#160;Nusz and Reid with respect to our overall business
    and their greater experience with our company, we will increase
    their base salaries, upon the effectiveness of this offering as
    set forth in the following table:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="59%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Percentage of
    50<SUP style="font-size: 85%; vertical-align: top">th<BR>

    </SUP></B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>2010 Base<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Percentile of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009 Base Salary</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Salary(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2010 Peer Group</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Thomas B. Nusz
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    220,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    325,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    87.8
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Taylor L. Reid
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    210,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    275,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    104.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    2010 base salaries will become effective upon consummation of
    this offering.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We believe the proposed salary increases for our Named Executive
    Officers are necessary in order for us to maintain a competitive
    compensation program following the effectiveness of this
    offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will pay each Named Executive Officer a base salary in
    order&#160;to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    recognize each executive officer&#146;s unique value and
    historical contributions to our success in light of salary norms
    in the industry and the general marketplace,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    remain competitive for executive talent within our industry,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide executives with sufficient, regularly-paid
    income,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reflect position and level of responsibility.
</TD>
</TR>

</TABLE>
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    <BR>
    90
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In setting annual base salary amounts, we anticipate that our
    Compensation Committee will generally target by position the
    50th&#160;percentile of our peer group.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Annual Performance-based Cash Incentive
    Awards.</I>&#160;&#160;We have historically utilized, and expect
    to continue to utilize, performance-based annual cash incentive
    awards to reward achievement of performance goals to be
    specified for the company as a whole with a time horizon of one
    year or less.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We include an annual performance-based cash incentive award as
    part of our compensation program because we believe this element
    of compensation helps&#160;to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    motivate management to achieve key shorter-term corporate
    objectives,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    align executives&#146; interests with our stockholders&#146;
    interests.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each year since our inception, our board of directors has
    approved annual performance incentive program targets based on
    metrics that it believes are relevant for a company of our size
    and growth expectations. These metrics were derived each year
    from our annual capital budgeting process based upon certain
    assumptions made by our management. The weight given to these
    targets and final bonus payments was discretionary during this
    period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For 2009, the performance metrics used for purposes of our
    annual cash performance incentive program included production
    volumes, capital spending, lease operating expenses, Adjusted
    EBITDA and specified milestones relating to our short and
    long-term strategic objectives, including the successful
    execution of our business plan, securing capital, development
    and management of our project inventory and organizational
    improvements. The Named Executive Officers were each eligible to
    receive maximum annual incentive bonuses equal to 30% of their
    respective 2009 base salaries. The actual results we attained
    for 2009 significantly exceeded our targeted performance goals
    (for example, we targeted annual average daily production
    volumes at 1,193&#160;Boe and attained 1,950&#160;Boe). This is
    due in part to the completion of two acquisitions during 2009
    that were not contemplated at the time our 2009 budget was set
    and that we drilled and participated in more wells during 2009
    than planned in the original budget. As a result of the
    exceptional performance attained in 2009, each Named Executive
    Officer received the maximum bonus amount. In addition, each
    Named Executive Officer received a special cash performance
    bonus amount for fiscal 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For 2010, the annual performance incentive metrics include
    production growth, reserve growth and efficiency, cost structure
    (operating costs and general and administrative expenses),
    Adjusted EBITDA, and specified milestones relating to our short
    and long term strategic objectives, including the successful
    execution of our business plan, securing capital, development
    and management of our project inventory and organizational
    improvements. Certain broad categories such as &#147;reserve
    growth and efficiency&#148; and &#147;cost structure&#148; will
    include specific, quantifiable metrics to be consistent with the
    remaining categories. We have set threshold, target and maximum
    levels for the performance metrics which will dictate the actual
    bonus amounts earned by the Named Executive Officers for 2010.
    If we achieve the target performance metric, the cash incentive
    award will be paid at target levels. In order to create
    additional incentive for exceptional company performance, awards
    can be up to a maximum percentage (which may exceed 100%) of the
    base salary designated for each Named Executive Officer but it
    is not expected that payment at this level would occur in most
    years. In addition, our board of directors retains the ability
    to apply discretion to awards based on extenuating market
    circumstances or individual performance and to modify amounts
    based on safety performance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For 2010, target awards to our two top executive officers,
    Mr.&#160;Nusz and Mr.&#160;Reid, are set at 80% and 60%,
    respectively, of 2010 base salary and may range from 40% to 160%
    of 2010 base salary, in the case of Mr.&#160;Nusz, and from 30%
    to 120% of 2010 base salary, in the case of Mr.&#160;Reid,
    depending on performance relative to specified performance
    metrics and subject to the discretion of our Compensation
    Committee. Target awards for the remaining Named Executive
    Officers are set at 50% of 2010 base salary and may range
    between 25% and 100% of 2010 base salary.
</DIV>
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    <BR>
    91
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Following the consummation of this offering, our Compensation
    Committee will determine an appropriate method of evaluating our
    company&#146;s achievement relative to various performance
    metrics and will determine if the current categories and
    associated metrics should be adjusted for future fiscal years.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Long-Term Equity Based
    Incentives.</I>&#160;&#160;Historically, our compensation
    structure has not included equity awards or other long-term
    incentive compensation, other than the opportunity of Named
    Executive Officers and other employees to invest their own funds
    in Oasis Petroleum Management LLC, which owns an interest in
    Oasis Petroleum LLC. This has allowed our Named Executive
    Officers to share in the benefits associated with our long-term
    growth. For 2010 and later years, we believe it is important and
    more consistent with the compensation programs of the companies
    in our peer group to establish a more formal long-term equity
    incentive program. As a result, we have adopted a Long-Term
    Incentive Plan, or LTIP, that permits the grant of our stock,
    options, restricted stock, restricted stock units, performance
    award, phantom stock, stock appreciation rights and other
    awards, subject to performance or other conditions, to our Named
    Executive Officers and other eligible employees in 2010 and
    later years. See &#147;&#151;&#160;Long-Term Incentive
    Plan.&#148; Going forward, we believe that long-term
    equity-based incentive compensation will be an important
    component of our overall compensation program because it will:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    balance short and long-term objectives;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    align our executives&#146; interests with the long-term
    interests of our stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reward long-term performance relative to industry peers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    remain competitive from a total remuneration standpoint;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    encourage executive retention;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    give executives the opportunity to share in our long-term
    performance.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our Compensation Committee will have the authority under the
    LTIP to award incentive compensation to our executive officers
    in such amounts and on such terms as the committee determines
    appropriate in its sole discretion. Initially, our long-term
    equity based incentive compensation will consist of annual
    restricted stock awards; however, our Compensation Committee may
    determine in the future that different
    <FONT style="white-space: nowrap">and/or</FONT>
    additional award types are appropriate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Beginning in fiscal 2010, we expect to award annual restricted
    stock awards. We believe this type of award, that will vest
    ratably over a three-year period provided the award recipient
    remains continuously employed through the vesting dates, aligns
    our executive officers with the interests of our stockholders on
    a long-term basis and has retentive attributes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For 2010, our board of directors has approved target restricted
    stock awards for our two top executive officers, Mr.&#160;Nusz
    and Mr.&#160;Reid, which will be comprised of a number of shares
    with an aggregate value on the date of grant equal to 120% and
    100%, respectively, of the officers&#146; 2010 base salaries.
    Awards for the remaining Named Executive Officers have been set
    at 75% of their respective 2010 base salaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition to the 2010 annual award grants, our board of
    directors has approved initial awards of restricted stock to
    executive officers and key employees, including the Named
    Executive Officers, upon consummation of this offering of a
    number of shares with an aggregate grant date value equal to
    100% of each individual&#146;s post-IPO annualized base salary.
    These initial restricted stock awards will vest over three years
    with the initial
    <FONT style="white-space: nowrap">one-third</FONT>
    tranche vesting in January 2011, provided the award recipient
    remains continuously employed by us through each vesting date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Employee Benefits.</I>&#160;&#160;In addition to the main
    elements of compensation previously discussed in this section,
    the Named Executive Officers are eligible for the same health,
    welfare and other employee benefits as are available to all our
    employees generally, which include medical and dental insurance,
    short and long-term disability insurance, a health club subsidy
    and a 401(k) plan with a
    <FONT style="white-space: nowrap">dollar-for-dollar</FONT>
    match on the first 5% of eligible employee contributions and
    escalating based on credited years of service. We do not sponsor
    any defined benefit pension plan or nonqualified deferred
    compensation arrangements at this time.
</DIV>
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    <BR>
    92
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The general benefits offered to all employees (and thus to the
    Named Executive Officers) are reviewed by our board of directors
    each year. Following the consummation of this offering, we will
    provide our Named Executive Officers with financial planning
    assistance benefits that are not available to all other
    employees. In the future, we anticipate that benefits offered
    only to Named Executive Officers will be reviewed by the
    Compensation Committee in conjunction with its annual review of
    executive officer compensation.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">How
    Elements of our Compensation Program are Related to Each
    Other</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We view the various components of compensation as related but
    distinct and emphasize &#147;pay for performance&#148; with a
    significant portion of total compensation reflecting a risk
    aspect tied to long- and short-term financial and strategic
    goals. Our compensation philosophy is to foster entrepreneurship
    at all levels of the organization by making long-term
    equity-based incentives, currently expected to be in the form of
    restricted stock grants, a significant component of executive
    compensation. We determine the appropriate level for each
    compensation component based in part, but not exclusively, on
    our view of internal equity and consistency, and other
    considerations we deem relevant, such as rewarding extraordinary
    performance. We have not adopted any formal or informal policies
    or guidelines for allocating compensation between long-term and
    currently paid out compensation, between cash and non-cash
    compensation, or among different forms of non-cash compensation.
    However, we believe that the compensation packages we will
    implement concurrently with the consummation of this offering
    are representative of an appropriate mix of compensation
    elements, and anticipate that our Compensation Committee will
    utilize a similar, though not identical, mix of compensation in
    future years. The approximate allocation of compensation
    elements in the proposed 2010 compensation packages for each
    Named Executive Officer is as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="52%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Other Named<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Thomas B. Nusz</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Taylor L. Reid</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Executive Officers</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Base Salary
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33.0
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38.5
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44.5
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Annual Cash Incentive Bonus
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Restricted Stock Awards
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33.5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100.0
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100.0
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100.0
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Accounting
    and Tax Considerations</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under Section&#160;162(m) of the Internal Revenue Code of 1986,
    as amended, or the Code, a limitation was placed on tax
    deductions of any publicly-held corporation for individual
    compensation to certain executives of such corporation exceeding
    $1,000,000 in any taxable year, unless the compensation is
    performance-based. An exception applies to this deductibility
    limitation for a limited period of time in the case of companies
    that become publicly-traded.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We reserve the right to use our judgment to authorize
    compensation payments that do not comply with the exemptions in
    Section&#160;162(m) when we believe that such payments are
    appropriate and in the best interest of the stockholders, after
    taking into consideration changing business conditions or the
    executive&#146;s individual performance
    <FONT style="white-space: nowrap">and/or</FONT>
    changes in specific job duties and responsibilities. During
    2009, the compensation level for none of our Named Executive
    Officers exceeded the tax deductible limitations under
    Section&#160;162(m).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If an executive is entitled to nonqualified deferred
    compensation benefits that are subject to Section&#160;409A of
    the Code, and such compensation does not comply with
    Section&#160;409A, then the benefits are taxable in the first
    year they are not subject to a substantial risk of forfeiture
    and are subject to certain additional adverse tax consequences.
    We intend to design such arrangements to comply with
    Section&#160;409A.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All equity awards to our employees, including executive
    officers, and to our directors will be granted and reflected in
    our consolidated financial statements, based upon the applicable
    accounting guidance, at fair market value on the grant date in
    accordance with Financial Accounting Standards Board (FASB)
    Accounting Standards Codification, Topic 718,
    &#147;Compensation&#160;&#151; Stock Compensation.&#148;
</DIV>
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    <BR>
    93
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Employment
    Agreements </FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Contemporaneous with this offering, we will enter into
    employment agreements with Messrs.&#160;Nusz and Reid, effective
    as of the completion of this offering. These employment
    agreements are designed to ensure an individual understanding of
    how the employment relationship may be extended or terminated,
    the compensation and benefits that we provide during the term of
    employment and the obligations each party has in the event of
    termination of an officer&#146;s employment. We expect the
    remainder of our employees to remain &#147;at will.&#148; In
    consultation with our compensation consultant,
    Longnecker&#160;&#038; Associates, we determined that due to the
    historical roles they have played in the success and growth of
    the company, Messrs.&#160;Nusz and Reid are critical to the
    ongoing stability and development of the business and therefore,
    entering into employment agreements with these individuals is
    advisable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The employment agreements provide for an initial three-year term
    that will be automatically renewed for successive one-year
    periods unless we give notice to the executive of non-renewal at
    least 60&#160;days prior to the last day of the then-current
    term. The employment agreements provide that Messrs.&#160;Nusz
    and Reid will receive annual base salaries of $325,000 and
    $275,000, respectively, which may be increased by our board of
    directors in its discretion. The employment agreements also
    provide that Messrs.&#160;Nusz and Reid are eligible to receive
    annual performance-based bonuses each year during the employment
    term. The target amount of each annual bonus is 80% for
    Mr.&#160;Nusz and 60% for Mr.&#160;Reid of the executive&#146;s
    base salary for the year, and greater or lesser amounts may be
    paid depending on the performance actually achieved. See
    &#147;&#151;&#160;Elements of Our Compensation and Why We Pay
    Each Element&#160;&#151; Annual Performance-based Cash Incentive
    Awards.&#148; The employment agreements also provide
    Messrs.&#160;Nusz and Reid with the opportunity to participate
    in the employee benefit arrangements offered to similarly
    situated executives and provide that they may periodically
    receive grants pursuant to our long-term incentive compensation
    plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The employment agreements provide for severance and change in
    control benefits to be paid to Messrs.&#160;Nusz and Reid under
    certain circumstances. The severance benefits are provided to
    reflect the fact that it may be difficult for executive officers
    to find comparable employment within a short period of time if
    they are involuntarily terminated. Change in control benefits
    are provided in order that the executives may objectively assess
    and pursue aggressively our interests and the interests of our
    stockholders with respect to a contemplated change in control,
    free from personal, financial and employment considerations. The
    employment agreements also impose certain non-compete,
    non-disclosure and similar obligations on the executives. The
    severance and change in control benefits and the
    post-termination obligations imposed on the executives are
    described in greater detail below. See
    &#147;&#151;&#160;Executive Compensation&#160;&#151; Potential
    Payments Upon Termination and Change in Control.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Severance
    and Change in Control Arrangements</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Messrs.&#160;Nusz and Reid are currently parties to an Ancillary
    Agreement, dated as of March&#160;5, 2007, pursuant to which
    they are entitled to receive certain severance benefits upon an
    involuntary termination without cause or for good reason. These
    severance benefits are described in greater detail below in the
    section entitled &#147;&#151;&#160;Executive
    Compensation&#160;&#151; Potential Payments Upon Termination and
    Change in Control.&#148; The Ancillary Agreement will terminate
    upon the consummation of this offering and will be of no further
    force or effect.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Other than the Ancillary Agreement entered into with
    Messrs.&#160;Nusz and Reid, we did not have any agreements in
    place providing severance or change in control benefits to our
    executive officers during 2009 and prior years. As described
    above, contemporaneous with the closing of this offering, the
    employment agreements will provide certain benefits and
    compensation to Messrs.&#160;Nusz and Reid in the event of
    certain terminations from employment, including in connection
    with a change in control. These benefits are described in
    greater detail above and in the section below entitled
    &#147;&#151;&#160;Executive Compensation&#160;&#151; Potential
    Payments Upon Termination and Change in Control.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For executive officers other than Messrs.&#160;Nusz and Reid, we
    expect the Compensation Committee will adopt an Executive
    Severance Plan and an Executive Change in Control Plan to
    provide severance and change in control benefits to our other
    executive officers for periods of time following the
    consummation of this
</DIV>
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    <BR>
    94
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    offering. These two plans will ensure an understanding of what
    benefits are to be paid to the other executive officers in the
    event of their termination or a change in control. For these
    executive officers, post-employment obligations regarding the
    use of confidential
    <FONT style="white-space: nowrap">and/or</FONT>
    proprietary information will be imposed through our broader
    policies covering all employees.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect that, in deciding to implement the Executive Severance
    Plan and the Executive Change in Control Plan, our Compensation
    Committee will determine that the interests of our stockholders
    are best served if we provide separation benefits to eliminate,
    or at least reduce, the reluctance of executive officers to
    pursue potential corporate transactions that may be in the best
    interests of our stockholders, but that may have resulting
    adverse consequences to the executive officers&#146; employment
    situations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I><FONT style="white-space: nowrap">Gross-Ups.</FONT></I>&#160;&#160;Under
    the employment agreements with Messrs.&#160;Nusz and Reid, and
    under our expected Executive Change in Control Plan in which the
    other executive officers will participate, if benefits to which
    the Named Executive Officers become entitled in connection with
    a change in control are considered &#147;excess parachute
    payments&#148; under Section&#160;280G of the Code, then the
    Named Executive Officers would be entitled to an additional
    <FONT style="white-space: nowrap">gross-up</FONT>
    payment from us, unless the aggregate amount of the payments due
    to the executive in connection with a change in control may be
    reduced by 10% or less and fall within the safe harbor amount
    for Section&#160;280G purposes such that no excise taxes are
    imposed, in which event, the payments to an executive will be so
    reduced. If a reduction of more than 10% would be needed in
    order for the payments to be within the Section&#160;280G safe
    harbor, then no reduction in the payment amounts will be made
    and the executive will receive a gross-up payment in an amount
    such that, after payment by the Named Executive Officer of all
    taxes including any excise tax imposed upon the
    <FONT style="white-space: nowrap">gross-up</FONT>
    payment, the Named Executive Officer would retain an amount
    equal to the excise tax imposed upon the payment.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Stock
    Ownership Guidelines</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stock ownership guidelines have not been implemented for our
    Named Executive Officers or directors. We will continue to
    periodically review best practices and reevaluate our position
    with respect to stock ownership guidelines.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Securities
    Trading Policy</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our securities trading policy provides that executive officers,
    including the Named Executive Officers, and our directors, may
    not, among other things, purchase or sell puts or calls to sell
    or buy our stock, engage in short sales with respect to our
    stock, buy our securities on margin, or otherwise hedge their
    ownership of our stock. The purchase or sale of stock by our
    executive officers and directors may only be made during certain
    windows of time and under the other conditions contained in our
    policy.
</DIV>
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    <BR>
    95
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Executive
    Compensation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Summary
    Compensation Table</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table shows information concerning the annual
    compensation for services provided to us by our Named Executive
    Officers during the fiscal year ended December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="57%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>All Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Bonus<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Compensation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name and Principal Position</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Salary</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Thomas B. Nusz
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    220,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    543,167
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,589
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    765,756
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    <I>Chairman, President and Chief Executive Officer</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Taylor L. Reid
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    210,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    329,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,907
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    540,907
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    <I>Executive Vice President and Chief Operating Officer</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Roy W. Mace
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    158,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    99,167
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,298
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    259,215
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    <I>Senior Vice President, Chief Accounting Officer and Corporate
    Secretary</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Kent O. Beers
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    225,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    193,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    632
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    418,632
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    <I>Senior Vice President Land</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Walter S. Smithwick
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    190,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    127,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    317,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    <I>Senior Vice President Operations</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Reflects amounts paid for services provided in fiscal year 2009
    pursuant to annual performance targets reviewed and weighted at
    the direction of our board of directors. Also reflects cash
    amounts paid as a special performance bonus for 2009.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    The following items are reported in the &#147;All Other
    Compensation&#148; column:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="57%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="14" nowrap align="center" valign="bottom">
    <B>Oasis Petroleum LLC<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="14" nowrap align="center" valign="bottom">
    <B>All Other Compensation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="14" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December 31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>All Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Employee</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Health Club</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Parking</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Transit</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Compensation</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Thomas B. Nusz
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,366
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,223
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,589
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Taylor L. Reid
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    684
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,223
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,907
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Roy W. Mace
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    548
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,298
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Kent O. Beers
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    632
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
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&nbsp;
</TD>
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    632
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Walter S. Smithwick
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Discussion
    of Summary Compensation Table</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our executive compensation policies and practices, pursuant to
    which the compensation set forth in the Summary Compensation
    Table was paid or awarded, are described above in CD&#038;A. As
    indicated therein, our executive compensation for 2009 consisted
    of a base salary, an annual performance based cash incentive
    award of up to 30% of base salary based on the performance of
    the company as a whole, a special 2009 cash performance bonus
    and limited additional compensation amounts.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Grants
    of Plan-based Awards and Outstanding Equity Awards at Fiscal
    Year End</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    None of our Named Executive Officers received any grants of
    plan-based awards in 2009 or held any outstanding equity awards
    as of December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Pension
    Benefits</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Other than our 401(k) Plan, we do not have any plan that
    provides for payments or other benefits at, following, or in
    connection with, retirement.
</DIV>
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    96
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Non-Qualified
    Deferred Compensation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We do not have any plan that provides for the deferral of
    compensation on a basis that is not tax qualified.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Potential
    Payments Upon Termination and Change in Control</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Other than the Ancillary Agreement that provides certain
    severance benefits to Messrs.&#160;Nusz and Reid upon an
    involuntary termination, there were no arrangements with our
    Named Executive Officers providing such individuals with
    severance or change in control benefits during 2009. The
    severance benefits Messrs.&#160;Nusz and Reid would have been
    entitled to receive under the Ancillary Agreement if they were
    involuntarily terminated at the end of fiscal 2009 are described
    in greater detail below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Contemporaneous with the consummation of this offering, the
    Ancillary Agreement will terminate and the severance benefits
    provided in that agreement will cease to be representative of
    what our Named Executive Officers will be entitled to receive in
    the event they are terminated under certain circumstances or we
    undergo a change in control. As described above, contemporaneous
    with the closing of this offering, we will enter into employment
    agreements with Messrs.&#160;Nusz and Reid that contain
    provisions regarding payments to be made to such individuals
    upon termination of their employment in certain circumstances,
    including in connection with a change in control. These
    agreements are described in greater detail below and in the
    section above entitled &#147;Compensation Discussion&#160;&#038;
    Analysis&#160;&#151; Employment Agreements.&#148; We also expect
    that our Compensation Committee will adopt an Executive
    Severance Plan and an Executive Change in Control Plan,
    following the consummation of this offering in which our Named
    Executive Officers, other than Messrs.&#160;Nusz and Reid, will
    participate. In order to provide our stockholders with an
    understanding of the severance and change in control benefits
    that will be implemented in connection with this offering, we
    also discuss below the benefits payable under the employment
    agreements, assuming such arrangements were in place at the end
    of fiscal 2009.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Ancillary
    Agreement</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Messrs.&#160;Nusz and Reid are parties to an Ancillary
    Agreement, dated as of March&#160;5, 2007, that provides each of
    them with certain severance benefits in the event their
    employment is terminated. The Ancillary Agreement will cease to
    be in effect upon the completion of this offering. If the
    executive is terminated by us for &#147;cause&#148; or by the
    executive without &#147;good reason,&#148; the executive is
    entitled to receive his accrued but unpaid base salary and any
    expenses eligible for reimbursement. If the executive is
    terminated by us without &#147;cause&#148; or by the executive
    for &#147;good reason,&#148; the executive is also entitled to
    receive continued payment of his current base salary for a
    period of 18&#160;months following the termination date.
    Assuming Messrs.&#160;Nusz and Reid were terminated without
    &#147;cause&#148; or for &#147;good reason&#148; effective
    December&#160;31, 2009, the executives would have been entitled
    to receive aggregate payments of $330,000 and $315,000,
    respectively, payable in substantially equal installments over
    an <FONT style="white-space: nowrap">18-month</FONT>
    period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If Messrs.&#160;Nusz and Reid are terminated for any reason
    other than by us upon the occurrence of an &#147;exit
    event,&#148; the executive is required to comply with certain
    noncompete and other obligations specified in the Ancillary
    Agreement, provided we continue to pay the executive his salary
    for the next 18&#160;months&#146; as severance. Specifically,
    the executives are required to comply with a noncompete covenant
    for 544&#160;days following termination, a nondisclosure
    covenant for a two year period following termination, and a
    nonsolicitation covenant for 18&#160;months following
    termination. These periods may be extended to account for any
    period of time during which an executive is in breach of the
    foregoing covenants.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For purposes of the Ancillary Agreement, the terms listed below
    have the following meanings:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>&#147;cause&#148;</I> means (i)&#160;the breach by
    the executive of his duties that is materially detrimental to us
    and, if curable, that is not cured within 10&#160;business days
    of notice of such breach, (ii)&#160;the executive&#146;s failure
    to comply in any material respect with a lawful, written
    direction of the board of managers of Oasis Petroleum LLC
    reasonably related to the executive&#146;s duties that he is
    physically able to perform, (iii)&#160;the executive&#146;s
    conviction of, or plea of nolo contendere to, any felony,
    (iv)&#160;the commission of an act
</DIV>
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<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    of fraud, dishonesty or moral turpitude that is reasonably
    likely to cause harm to us or our reputation, (v)&#160;the
    executive&#146;s habitual insobriety or failure to perform his
    duties due to alcoholism or addiction to controlled substances,
    (vi)&#160;any action taken knowingly or with reckless disregard
    that is materially adverse to our interests or assets and
    (vii)&#160;a material breach by the executive of any of his
    covenants or agreements in the Ancillary Agreement or in the
    Oasis Petroleum LLC Agreement that, if curable, is not cured
    within five business days of notice of such breach.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>&#147;exit event&#148;</I> means the sale of the
    company in one transaction or a series of related transactions,
    or structured as a sale or transfer of all or substantially all
    of the membership interests in the company (including by merger,
    consolidation, share exchange or similar transaction) or the
    sale or other transfer of all or substantially all of the assets
    of the company, or a combination of both.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>&#147;good reason&#148;</I> means (i)&#160;the
    assignment to the executive of duties substantially inconsistent
    with his position, duties, responsibility and status,
    (ii)&#160;a reduction in the executive&#146;s base salary or our
    failure to timely pay base salary, or any other material breach
    by us of our obligations under the Ancillary Agreement,
    (iii)&#160;relocation of the executive&#146;s employment to a
    location other than the Houston, Texas metropolitan area for a
    material period of time, unless the executive consents or the
    relocation is necessitated by an act of God or certain other
    events, (iv)&#160;a person (with certain limited exceptions)
    acquires more than 50% of the voting securities of EnCap
    and&#160;more than two of the current partners of EnCap cease to
    be actively involved in the management and conduct of
    EnCap&#146;s business and affairs, or (v)&#160;the EnCap members
    sell all or substantially all of their membership interests and
    cease to have designated managers to the board of managers of
    Oasis Petroleum LLC constituting a majority thereof.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Employment
    Agreements</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Contemporaneous with the consummation of this offering, the
    Ancillary Agreement will terminate and the severance and change
    in control benefits due to Messrs.&#160;Nusz and Reid will be
    governed by the proposed employment agreements. Under the
    employment agreements, upon any termination of employment,
    Messrs.&#160;Nusz and Reid are entitled to receive accrued but
    unpaid salary, any unpaid annual performance bonus earned for
    the calendar year prior to the year in which the executive
    terminates, reimbursement of eligible expenses and any employee
    benefits due pursuant to their terms. In addition, if
    Messrs.&#160;Nusz and Reid are terminated due to death or
    &#147;disability,&#148; then they will be entitled to receive
    the following amounts: (i)&#160;a pro-rata portion of the annual
    performance bonus for the calendar year of termination,
    (ii)&#160;an amount equal to twelve months&#146; worth of the
    executive&#146;s base salary, payable in a lump sum within
    60&#160;days or by March&#160;15 of the year following
    termination, whichever is earlier, and (iii)&#160;an amount
    equal to 18&#160;months&#146; worth of COBRA premiums, if the
    executive elects and remains eligible for COBRA.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If we terminate the employment of Messrs.&#160;Nusz and Reid for
    reasons other than &#147;cause,&#148; if we elect not to renew
    the employment agreement with the executive, or if the
    executives terminate employment for &#147;good reason,&#148;
    then Messrs.&#160;Nusz and Reid will be entitled to receive the
    following amounts: (i)&#160;a pro-rata portion of the annual
    performance bonus for the calendar year of termination,
    (ii)&#160;an amount equal to the greater of (a)&#160;the
    aggregate amount of base salary payable for the remainder of the
    employment term, and (b)&#160;an amount equal to
    12&#160;months&#146; worth of the executive&#146;s base salary,
    payable in equal monthly installments (with amounts in excess of
    certain limitations under Section&#160;409A of the code payable
    in a lump sum within 60&#160;days), (iii)&#160;an amount equal
    to 18&#160;months&#146; worth of COBRA premiums, if the
    executive elects and remains eligible for COBRA, (iv)&#160;an
    amount equal to the aggregate of each annual target performance
    bonus the executive would have been entitled to receive if he
    had continued to perform services for the remainder of the
    employment term, if termination occurs during the initial
    three-year term, or an amount equal to 80% (for Mr.&#160;Nusz)
    and 60% (for Mr.&#160;Reid) of base salary for the remainder of
    the then-current term, if termination occurs after the initial
    term, in each case minus the amount of the pro-rata bonus paid,
    and&#160;(v)&#160;accelerated vesting of all outstanding equity
    awards. Severance amounts, other than the pro-rata bonus amount,
    are subject to the executive&#146;s delivery to us (and
    nonrevocation) of a release of claims within 60&#160;days of his
    termination date.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the event a change in control occurs, all outstanding equity
    awards held by Messrs.&#160;Nusz and Reid will be immediately
    vested in full. In addition, in the event Messrs.&#160;Nusz and
    Reid are terminated by us other than for &#147;cause,&#148; if
    we elect not to renew the employment agreements or if the
    executives terminate employment for &#147;good reason,&#148; in
    each case, within 12&#160;months following a &#147;change in
    control,&#148; Messrs.&#160;Nusz and Reid (or their respective
    estates) are entitled to receive (i)&#160;an amount equal to two
    times the sum of (a)&#160;the executive&#146;s annualized base
    salary and (b)&#160;the maximum annual performance bonus he is
    eligible to receive for the then-current year if termination
    occurs during the initial three year term, or an amount equal to
    80% (for Mr.&#160;Nusz) and 60% (for Mr.&#160;Reid) of base
    salary, if termination occurs after the initial term and
    (ii)&#160;an amount equal to 18&#160;month&#146;s worth of COBRA
    premiums, if the executive elects and is eligible to receive
    COBRA. If Messrs.&#160;Nusz and Reid are terminated in
    connection with a change in control and would receive greater
    benefits under another provision of their employment agreements,
    they will be entitled to receive the greater benefits. Because
    of the tax on so-called &#147;parachute payments&#148; imposed
    by the Code&#146;s Section&#160;4999 on payments made in
    connection with a change in control, we have agreed to reimburse
    Messrs.&#160;Nusz and Reid for any excise taxes imposed as a
    result of a payment of change in control benefits and to gross
    up those tax payments to keep the executives whole, unless the
    aggregate payments due to the executives may be reduced by 10%
    or less and, following such reduction, will not exceed the safe
    harbor amount under Code Section&#160;280G, in which case the
    payments due will be so reduced.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Messrs.&#160;Nusz and Reid are subject to certain
    confidentiality, noncompete and nonsolicitation provisions
    contained in the employment agreements. The confidentiality
    covenants are perpetual, while the noncompete and
    nonsolicitation covenants apply during the term of the
    employment agreements and for 12&#160;months following the
    employee&#146;s termination date, except that the latter
    covenants will cease to apply if the executive is terminated for
    any reason on or after a change in control.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For purposes of the employment agreements, the terms listed
    below have been defined as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;<I>&#147;cause&#148;</I> means (a)&#160;the executive
    has been convicted of a misdemeanor involving moral turpitude or
    a felony, (b)&#160;the executive has engaged in grossly
    negligent or willful misconduct in performing his duties, which
    has a material detrimental effect on the company, (c)&#160;the
    executive has breached a material provision of the employment
    agreement, (d)&#160;the executive has engaged in conduct that is
    materially injurious to us or&#160;(e)&#160;the executive has
    committed an act of fraud. Messrs.&#160;Nusz and Reid will have
    a limited period of 30&#160;days to cure events (unless the
    cause event is that described in clause&#160;(a) above).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (ii)&#160;<I>&#147;change in control&#148;</I> means (a)&#160;a
    person acquires 50% or more of our outstanding stock or
    outstanding voting securities, (b)&#160;individuals who serve as
    board members on the effective date of the employment agreements
    (or who are subsequently approved by a majority of such
    individuals) cease for any reason to constitute at least a
    majority of the board of directors, (c)&#160;consummation of a
    reorganization, merger, consolidation or a sale of all or
    substantially all of our assets, subject to certain limited
    exceptions, and (d)&#160;approval by our stockholders of a
    complete liquidation or dissolution.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (iii)&#160;<I>&#147;disability&#148;</I> means the
    executive&#146;s inability to perform the executive&#146;s
    essential functions with or without reasonable accommodation, if
    required by law, due to physical or mental impairment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (iv)&#160;<I>&#147;good reason&#148;</I> means, without the
    executive&#146;s express written consent, (a)&#160;a material
    breach by us of the employment agreement, (b)&#160;a material
    reduction in the executive&#146;s base compensation, (c)&#160;a
    material diminution in the executive&#146;s authority, duties or
    responsibilities, (d)&#160;a change in the geographic location
    where executive must normally perform services by more than
    50&#160;miles or (e)&#160;requirement that the executive report
    to an employee instead of to our board (for Mr.&#160;Nusz) or a
    material reduction in the authority, duties or responsibilities
    of the person to whom the executive reports (for Mr.&#160;Reid).
    The executive must notify us within 60&#160;days of the
    occurrence of any such event and we have 30&#160;days following
    notice to cure.
</DIV>
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Quantification
    of Payments</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The table below discloses the amount of compensation
    <FONT style="white-space: nowrap">and/or</FONT>
    benefits due to the Named Executive Officers in the event of
    their termination of employment
    <FONT style="white-space: nowrap">and/or</FONT> in
    the event we undergo a change in control. The amounts disclosed
    assume such termination
    <FONT style="white-space: nowrap">and/or</FONT> the
    occurrence of such change in control was effective
    December&#160;31, 2009, but taking into account the arrangements
    described above that will be entered into or adopted
    contemporaneous with the effectiveness of this offering. The
    amounts below constitute estimates of the amounts that would be
    paid out to the Named Executive Officers upon their respective
    terminations
    <FONT style="white-space: nowrap">and/or</FONT> upon
    a change in control under such arrangements. The actual amounts
    to be paid out are dependent on various factors, which may or
    may not exist at the time a Named Executive Officer is actually
    terminated
    <FONT style="white-space: nowrap">and/or</FONT> a
    change in control actually occurs. Therefore, such amounts and
    disclosures should be considered &#147;forward-looking
    statements.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
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<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
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<TD>
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</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Termination<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
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<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Without<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
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&nbsp;
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<TD>
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<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Cause or<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
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&nbsp;
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<TD>
&nbsp;
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<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>for Good<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
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<TD colspan="2" nowrap align="center" valign="bottom">
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<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Reason<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
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<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
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<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Termination Due<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
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</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Within one<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Termination Due<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>to Non-<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Termination<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Year of a<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>to Death or<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Extension by<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Without Cause or<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Change in<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Change in<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Named Executive Officer</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Disability</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>company</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>for Good Reason</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Control</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Control</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Thomas B. Nusz
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Salary
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
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&nbsp;
</TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Bonus Amounts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;COBRA Premiums
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Change in Control Payments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Accelerated Equity Vesting
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    <FONT style="white-space: nowrap">&#149;&#160;&#160;&#160;Gross-Up</FONT>
    Payments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Taylor L. Reid
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Salary
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Bonus Amounts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;COBRA Premiums
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Change in Control Payments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Accelerated Equity Vesting
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    <FONT style="white-space: nowrap">&#149;&#160;&#160;&#160;Gross-Up</FONT>
    Payments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -4pt; margin-left: 4pt">
    &#149;&#160;&#160;&#160;Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Long-Term
    Incentive Plan</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect to adopt a LTIP prior to the consummation of this
    offering in order to attract and retain the best available
    personnel for positions of substantial responsibility, to
    provide additional incentives to our employees, directors and
    consultants, and to promote the success of our business. We
    anticipate that the LTIP will primarily provide for grants of
    (a)&#160;incentive stock options qualified as such under
    U.S.&#160;federal income tax laws, (b)&#160;stock options that
    do not qualify as incentive stock options, (c)&#160;stock
    appreciation rights, or SARs, (d)&#160;restricted stock awards,
    (e)&#160;restricted stock units (f)&#160;performance awards, or
    (g)&#160;any combination of such awards.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The LTIP is not subject to the Employee Retirement Income
    Security Act of 1974, as amended, or ERISA. The LTIP, for a
    limited period of time following this offering, will qualify for
    an exception to the deductibility limitations imposed by
    Section&#160;162(m) of the Code. As a result, during that
    limited period of time, awards will be exempt from the
    limitations on the deductibility of compensation that exceeds
    $1,000,000.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    100
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Shares&#160;Available.</I>&#160;&#160;The maximum aggregate
    number of shares of our common stock that may be reserved and
    available for delivery in connection with awards under the LTIP
    is&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    subject to adjustment in accordance with the terms of the LTIP.
    If common stock subject to any award is not issued or
    transferred, or ceases to be issuable or transferable for any
    reason, including stock subject to an award that is cancelled,
    forfeited or settled in cash and shares withheld to pay the
    exercise price of or to satisfy the withholding obligations with
    respect to an award, those shares of common stock will again be
    available for delivery under the LTIP to the extent allowable by
    law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Eligibility.</I>&#160;&#160;Any individual who provides
    services to us, including non-employee directors and
    consultants, is eligible to participate in the LTIP (each, an
    &#147;Eligible Person&#148;). Each Eligible Person who is
    designated by the Compensation Committee to receive an award
    under the LTIP will be a &#147;Participant.&#148; An Eligible
    Person will be eligible to receive an award pursuant to the
    terms of the LTIP and subject to any limitations imposed by
    appropriate action of the Compensation Committee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Administration.</I>&#160;&#160;Our board of directors has
    appointed the Compensation Committee to administer the LTIP
    pursuant to its terms, except in the event our board of
    directors chooses to take action under the LTIP. Our
    Compensation Committee will, unless otherwise determined by the
    board of directors, be comprised of two or more individuals each
    of whom constitutes an &#147;outside director&#148; as defined
    in Section&#160;162(m) of the Code and &#147;nonemployee
    director&#148; as defined in
    <FONT style="white-space: nowrap">Rule&#160;16b-3</FONT>
    under the Exchange Act. Unless otherwise limited, the
    Compensation Committee has broad discretion to administer the
    LTIP, including the power to determine to whom and when awards
    will be granted, to determine the amount of such awards
    (measured in cash, shares of common stock or as otherwise
    designated), to proscribe and interpret the terms and provisions
    of each award agreement, to accelerate the exercise terms of any
    award (provided that such acceleration does not cause an award
    intended to qualify as performance based compensation for
    purposes of Section&#160;162(m) of the Code to fail to so
    qualify), to delegate duties under the LTIP and to execute all
    other responsibilities permitted or required under the LTIP.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Terms of Options.</I>&#160;&#160;The Compensation Committee
    may grant options to Eligible Persons including
    (a)&#160;incentive stock options (only to our employees) that
    comply with Section&#160;422 of the Code and
    (b)&#160;nonstatutory options. The exercise price for an option
    must not be less than the greater of (a)&#160;the par value per
    share of common stock or (b)&#160;the fair market value per
    share as of the date of grant. Options may be exercised as the
    Compensation Committee determines, but not later than
    10&#160;years from the date of grant. Any incentive stock option
    granted to an employee who possesses more than 10% of the total
    combined voting power of all classes of our shares within the
    meaning of Section&#160;422(b)(6) of the Code must have an
    exercise price of at least 110% of the fair market value of the
    underlying shares at the time the option is granted and may not
    be exercised later than five years from the date of grant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Terms of SARs.</I>&#160;&#160;SARS may be awarded in
    connection with or separate from an option. An SAR is the right
    to receive an amount equal to the excess of the fair market
    value of one share of our common stock on the date of exercise
    over the grant price of the SAR. SARs awarded in connection with
    an option will entitle the holder, upon exercise, to surrender
    the related option or portion thereof relating to the number of
    shares for which the SAR is exercised, which option or portion
    thereof will then cease to be exercisable, in exchange for an
    amount calculated as described in the preceding sentence. Such
    SAR is exercisable or transferable only to the extent that the
    related option is exercisable or transferable. SARs granted
    independently of an option will be exercisable as the
    Compensation Committee determines. The term of an SAR will be
    for a period determined by the Compensation Committee but will
    not exceed ten years. SARs may be paid in cash, common stock or
    a combination of cash and stock, as provided for by the
    Compensation Committee in the award agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Restricted Stock Awards.</I>&#160;&#160;A restricted stock
    award is a grant of shares of common stock subject to a risk of
    forfeiture, restrictions on transferability, and any other
    restrictions imposed by the Compensation Committee in its
    discretion. Except as otherwise provided under the terms of the
    LTIP or an award agreement, the holder of a restricted stock
    award may have rights as a stockholder, including the right to
    vote or to receive dividends (subject to any mandatory
    reinvestment or other requirements imposed by the Compensation
    Committee). A restricted stock award that is subject to
    forfeiture restrictions may be forfeited and reacquired by us
    upon
</DIV>
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    <BR>
    101
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    termination of employment or services. Common stock distributed
    in connection with a stock split or stock dividend, and other
    property distributed as a dividend, may be subject to the same
    restrictions and risk of forfeiture as the restricted stock with
    respect to which the distribution was made.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Restricted Stock Units.</I>&#160;&#160;Restricted stock units
    are rights to receive common stock, cash or a combination of
    both at the end of a specified period. Restricted stock units
    may be subject to restrictions, including a risk of forfeiture,
    as specified in the award agreement. Restricted stock units may
    be satisfied by common stock, cash or any combination thereof,
    as determined by the Compensation Committee. Except as otherwise
    provided by the Compensation Committee in the award agreement or
    otherwise, restricted stock units subject to forfeiture
    restrictions will be forfeited upon termination of a
    participant&#146;s employment or services prior to the end of
    the specified period. The Compensation Committee may, in its
    sole discretion, grant dividend equivalents with respect to
    restricted stock units.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Other Awards.</I>&#160;&#160;Eligible Persons may be granted,
    subject to applicable legal limitations and the terms of the
    LTIP and its purposes, other awards related to common stock.
    Such awards may include, but are not limited to, common stock
    awarded as a bonus, dividend equivalents, convertible or
    exchangeable debt securities, other rights convertible or
    exchangeable into common stock, purchase rights for common
    stock, awards with value and payment contingent upon our
    performance or any other factors designated by the Compensation
    Committee, and awards valued by reference to the book value of
    common stock or the value of securities of or the performance of
    specified subsidiaries. The Compensation Committee will
    determine terms and conditions of all such awards. Cash awards
    may granted as an element of or a supplement to any awards
    permitted under the LTIP. Awards may also be granted in lieu of
    obligations to pay cash or deliver other property under the LTIP
    or under other plans or compensatory arrangements, subject to
    any applicable provision under Section&#160;16 of the Exchange
    Act.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Performance Awards.</I>&#160;&#160;The Compensation Committee
    may designate that certain awards granted under the LTIP
    constitute &#147;performance&#148; awards. A performance award
    is any award the grant, exercise or settlement of which is
    subject to one or more performance standards. These standards
    may include business criteria for us on a consolidated basis,
    such as total stockholders&#146; return and earnings per share,
    or for specific subsidiaries or business or geographical units.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Director
    Compensation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We did not award any compensation to our non-employee directors
    during fiscal year 2009. Going forward, the board of directors
    believes that attracting and retaining qualified non-employee
    directors will be critical to the future value growth and
    governance, and that providing a total compensation package
    between the
    50<SUP style="font-size: 85%; vertical-align: top">th</SUP>

    percentile and
    75<SUP style="font-size: 85%; vertical-align: top">th</SUP>

    percentile of our peer group is necessary to accomplish that
    objective. Our board of directors also believes that the
    compensation package for our non-employee directors should
    require a significant portion of the total compensation package
    to be equity-based to align the interests of these directors
    with our stockholders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After review with Longnecker&#160;&#038; Associates of
    non-employee director compensation paid by our peer group, our
    board of directors approved the following compensation plan for
    non-employee directors for the year 2010:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an annual cash retainer fee of $40,000, plus cash payments of
    $1,250 for each board of directors&#146; meeting attended and
    $1,000 for each committee meeting attended;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an initial equity award
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of restricted stock;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an annual equity award of shares of our restricted stock having
    a value of $70,000 based on the average of the high and low
    market-quoted sales prices of our common stock on the grant date
    of the award.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Both the initial and annual grants of restricted stock will vest
    equally over a three-year period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, the chairpersons of our Audit Committee,
    Compensation Committee and Nominating&#160;&#038; Governance
    Committee will receive annual cash retainer fees of $10,000,
    $5,000 and $5,000, respectively.
</DIV>
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    <BR>
    102
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Directors who are also our employees will not receive any
    additional compensation for their service on the board of
    directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each director will be reimbursed for (i)&#160;travel and
    miscellaneous expenses to attend meetings and activities of our
    board of directors or its committees; (ii)&#160;travel and
    miscellaneous expenses related to such director&#146;s
    participation in our general education and orientation program
    for directors; and (iii)&#160;travel and miscellaneous expenses
    for each director&#146;s spouse who accompanies a director to
    attend meetings and activities of our board of directors or any
    of our committees.
</DIV>
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    <BR>
    103
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='125'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CERTAIN
    RELATIONSHIPS AND RELATED PARTY TRANSACTIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Since January&#160;1, 2007, there has not been, nor is there
    currently proposed, any transaction or series of similar
    transactions to which we were or are a party in which the amount
    involved exceeded or exceeds $120,000 and in which any of our
    directors, executive officers, holders of more than 5% of any
    class of our voting securities, or any member of the immediate
    family of any of the foregoing persons, had or will have a
    direct or indirect material interest, other than compensation
    arrangements with directors and executive officers, which are
    described in &#147;Executive Compensation and Other
    Information,&#148; and the transactions described or referred to
    below.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Corporate
    Reorganization</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with our corporate reorganization, we will engage
    in certain transactions with certain affiliates and our existing
    equity holders. Please see &#147;Corporate Reorganization&#148;
    for a description of these transactions.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Historical
    Transactions with Oasis Petroleum LLC</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Since its inception, Oasis Petroleum LLC has issued additional
    membership interests as consideration for capital contributions
    received from its members, including EnCap, Oasis Petroleum
    Management LLC and other private investors. Capital
    contributions  for the years ended December&#160;31, 2009 and
    2008 and the period ended December&#160;31, 2007 were
    $104.6&#160;million, $80.5&#160;million and $49.9&#160;million,
    respectively. In addition, Oasis Petroleum LLC has paid the
    legal fees of EnCap and Oasis Petroleum Management LLC in
    connection with these transactions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with each of its capital contributions, EnCap
    receives a placement fee in an amount equal to 2% of its capital
    contributions. Such placement fees are remitted by us to EnCap
    or its designee. Placement fees for the years ended
    December&#160;31, 2009 and 2008 and the period ended
    December&#160;31, 2007 were $1.6&#160;million, $1.2&#160;million
    and $1.0&#160;million, respectively.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Procedures
    for Approval of Related Person Transactions</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A &#147;Related Party Transaction&#148; is a transaction,
    arrangement or relationship in which we or any of our
    subsidiaries was, is or will be a participant, the amount of
    which involved exceeds $120,000, and in which any related party
    had, has or will have a direct or indirect material interest. A
    &#147;Related Person&#148; means:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any person who is, or at any time during the applicable period
    was, one of our executive officers or one of our directors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any person who is known by us to be the beneficial owner of more
    than 5.0% of our common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any immediate family member of any of the foregoing persons,
    which means any child, stepchild, parent, stepparent, spouse,
    sibling,
    <FONT style="white-space: nowrap">mother-in-law,</FONT>
    <FONT style="white-space: nowrap">father-in-law,</FONT>
    <FONT style="white-space: nowrap">son-in-law,</FONT>
    <FONT style="white-space: nowrap">daughter-in-law,</FONT>
    <FONT style="white-space: nowrap">brother-in-law</FONT>
    or
    <FONT style="white-space: nowrap">sister-in-law</FONT>
    of a director or a beneficial owner of more than 5.0% of our
    common stock, and any person (other than a tenant or employee)
    sharing the household of such director or beneficial owner of
    more than 5.0% of our common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    and any firm, corporation or other entity in which any of the
    foregoing persons is a partner or principal or in a similar
    position or in which such person has a 10.0% or greater
    beneficial ownership interest.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors will adopt a written related party
    transactions policy prior to the completion of this offering.
    Pursuant to this policy, the Audit Committee will review all
    material facts of all Related Party Transactions and either
    approve or disapprove entry into the Related Party Transaction,
    subject to certain limited exceptions. In determining whether to
    approve or disapprove entry into a Related Party Transaction,
    the Audit Committee shall take into account, among other
    factors, the following: (1)&#160;whether the Related Party
    Transaction is on terms no less favorable than terms generally
    available to an unaffiliated third-party under the same or
    similar circumstances and (2)&#160;the extent of the Related
    Person&#146;s interest in the transaction. Further, the policy
    requires that all Related Party Transactions required to be
    disclosed in our filings with the SEC be so disclosed in
    accordance with applicable laws, rules and regulations.
</DIV>
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    <BR>
    104
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='114'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CORPORATE
    REORGANIZATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oasis Petroleum Inc. is a Delaware corporation that was formed
    for the purpose of making this offering. Pursuant to the terms
    of a corporate reorganization that will be completed
    concurrently with the closing of this offering, Oasis Petroleum
    Inc. will acquire all of the outstanding membership interests in
    Oasis Petroleum LLC in exchange for shares of Oasis Petroleum
    Inc.&#146;s common stock. Therefore, investors in this offering
    will only receive, and this prospectus only describes the
    offering of, shares of common stock of Oasis Petroleum Inc. Our
    business will continue to be conducted through Oasis Petroleum
    LLC, as a wholly owned subsidiary of Oasis Petroleum Inc. See
    &#147;Description of Capital Stock&#148; for additional
    information regarding the terms of our certificate of
    incorporation and bylaws as will be in effect upon the closing
    of this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The reorganization will consist of a merger pursuant to which
    the outstanding membership interests in Oasis Petroleum LLC will
    be converted into membership interests in OAS Holdco. As a
    result of the merger, Oasis Petroleum LLC will become a wholly
    owned subsidiary of OAS Holdco. OAS Holdco will then contribute
    all of the membership interests in Oasis Petroleum LLC to Oasis
    Petroleum Inc. in exchange
    for&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock in Oasis Petroleum Inc. In connection with our
    corporate reorganization, an estimated net deferred tax
    liability of approximately $8.0&#160;million will be established
    for differences between the book and tax basis of our assets and
    liabilities and a corresponding expense will be recorded to net
    income from continuing operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Contemporaneously with Oasis Petroleum LLC becoming a wholly
    owned subsidiary of Oasis Petroleum Inc., the limited liability
    company agreement of Oasis Petroleum LLC will be amended and
    restated to terminate certain rights and obligations of its
    members.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We refer to (i)&#160;the reorganization pursuant to which the
    outstanding membership interests of Oasis Petroleum LLC will be
    converted into membership interests of OAS Holdco, (ii)&#160;the
    acquisition by Oasis Petroleum Inc. of all of the membership
    interests of Oasis Petroleum LLC in exchange for shares of Oasis
    Petroleum Inc.&#146;s common stock, (iii)&#160;the effectiveness
    of the limited liability company agreement of OAS Holdco and
    (iv)&#160;the consummation of the other related transactions
    collectively as our &#147;corporate reorganization.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">LLC
    Agreement of OAS Holdco</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Members of Oasis Petroleum LLC have entered into a limited
    liability company agreement, or LLC agreement, for OAS Holdco
    that will become effective upon the consummation of our
    corporate reorganization and this offering. The LLC agreement
    provides that promptly following the consummation of the
    corporate reorganization and the completion of this offering,
    OAS Holdco make the following distributions (based on an assumed
    initial public offering price of
    $&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    per share):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a distribution to Oasis Petroleum Management LLC
    consisting&#160;of:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="2%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock, which represents 5% of the outstanding
    shares of our common stock held by OAS Holdco immediately prior
    to this offering less the number of shares sold by OAS Holdco in
    this offering;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $&#160;&#160;&#160;&#160;&#160;&#160;million, which represents
    5% of the net proceeds of this offering received by OAS Holdco
    as the selling stockholder;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a distribution to certain private investors and Oasis Petroleum
    Management LLC consisting of an aggregate&#160;of:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="2%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock, which represents such investors&#146;
    proportionate interest (based on prior capital contributions
    other than capital contributions of Oasis Petroleum Management
    LLC) in the outstanding shares of our common stock held by OAS
    Holdco immediately prior to this offering less the number of
    shares sold by OAS Holdco in this offering;&#160;and
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    105
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="2%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    $&#160;&#160;&#160;&#160;&#160;&#160;million, which represents
    such investors&#146; proportionate interest (based on capital
    contributions other than capital contributions of Oasis
    Petroleum Management LLC) in the net proceeds of this offering
    received by OAS Holdco as the selling stockholder;&#160;and
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a distribution to all other members, including funds managed by
    EnCap, consisting of an aggregate of
    $&#160;&#160;&#160;&#160;&#160;&#160;million, which represents
    the remaining net proceeds of this offering received by OAS
    Holdco as the selling stockholder.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Contemporaneously with the completion of the distributions to
    certain private investors described above, such private
    investors shall automatically cease to be members in OAS Holdco.
    In lieu of receiving cash distributions of the net proceeds of
    this offering received by OAS Holdco as the selling stockholder
    or the net proceeds of any future offering of our common stock
    by OAS Holdco, Oasis Petroleum Management LLC may elect to
    receive an equivalent distribution of shares of our common stock
    held by OAS Holdco based on the price per share received in such
    sale.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition to the distributions described above, the LLC
    agreement provides that OAS Holdco will make distributions of
    the proceeds to its members of any future sales of our common
    stock by OAS Holdco based on the price per share received in
    such sale. The LLC Agreement also provides that OAS Holdco will
    make distributions to its members upon a sale of Oasis Petroleum
    Inc. based on the valuation in connection with such transaction.
    Unless otherwise determined by the board of managers of OAS
    Holdco, on the third anniversary of the expiration of the
    lock-up agreement between OAS Holdco and the underwriters
    entered into in connection with this offering, OAS Holdco LLC
    will automatically dissolve and distribute all remaining shares
    of our common stock to its members based on a valuation at such
    time. The number of shares received by Oasis Petroleum
    Management LLC will increase as the rate of return ultimately
    realized by the other members of OAS Holdco increases. For
    example, assuming a distribution of all of our remaining shares
    of common stock by OAS Holdco promptly after this offering at a
    valuation equal to the initial public offering price of
    $         per share, Oasis Petroleum Management LLC would be
    entitled to receive    % of the number of shares distributed by
    OAS Holdco, or&#160;&#160;&#160;&#160;&#160;% of our total
    shares outstanding. For illustrative purposes and assuming a
    distribution of all of our remaining shares of common stock by
    OAS Holdco promptly after this offering at a hypothetical
    valuation of $&#160;&#160;&#160;&#160;&#160;&#160;per share,
    Oasis Petroleum Management LLC would be entitled to receive    %
    of the number of shares distributed by OAS Holdco,
    or&#160;&#160;&#160;&#160;&#160;% of our total shares
    outstanding.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum Management LLC</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oasis Petroleum Management LLC was formed contemporaneously with
    Oasis Petroleum LLC to hold membership interests in Oasis
    Petroleum LLC on behalf of certain of our executive officers and
    other employees. Following the completion of the transactions
    described above, Oasis Petroleum Management LLC will own both a
    direct interest in our common stock and an indirect interest in
    OAS Holdco.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    106
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='115'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PRINCIPAL
    AND SELLING STOCKHOLDERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth information with respect to the
    beneficial ownership of our common stock as of March&#160;1,
    2010 after giving effect to our corporate reorganization by:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each of our named executive officers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each of our directors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    all of our directors and named executive officers as a group;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the selling stockholder;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each stockholder known by us to be the beneficial owner of more
    than 5% of our outstanding shares of common stock.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Except as otherwise indicated, the person or entities listed
    below have sole voting and investment power with respect to all
    shares of our common stock beneficially owned by them, except to
    the extent this power may be shared with a spouse. All
    information with respect to beneficial ownership has been
    furnished by the respective directors, officers or 5% or more
    stockholders, as the case may be. The address for OAS Holding
    Company LLC and Oasis Petroleum Management LLC is 1001 Fannin
    Street, Suite 202, Houston, TX 77002.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="45%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="5%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="5%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Shares Beneficially Owned<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Shares Beneficially Owned<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>Name and Address of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Prior to the Offering</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Shares Being<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>After Offering</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Beneficial Owner</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Number</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Percentage</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Offered</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Number</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Percentage</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Selling Stockholder and 5% Stockholder:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    OAS Holding Company LLC
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>5% Stockholder:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oasis Petroleum Management LLC
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Directors and Named Executive Officers:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Thomas B. Nusz
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Taylor L. Reid
</DIV>
</TD>
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<DIV style="text-indent: -10pt; margin-left: 10pt">
    Roy W. Mace
</DIV>
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<DIV style="text-indent: -10pt; margin-left: 10pt">
    Kent O. Beers
</DIV>
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<DIV style="text-indent: -10pt; margin-left: 10pt">
    Walter S. Smithwick
</DIV>
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<DIV style="text-indent: -10pt; margin-left: 10pt">
    Douglas E. Swanson, Jr.&#160;
</DIV>
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<DIV style="text-indent: -10pt; margin-left: 10pt">
    Robert L. Zorich
</DIV>
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<DIV style="text-indent: -10pt; margin-left: 10pt">
    All directors and named executive officers as a group
</DIV>
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</TABLE>

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</DIV>
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    <BR>
    107
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='116'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF CAPITAL STOCK</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon completion of this offering, the authorized capital stock
    of Oasis Petroleum Inc. will consist
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock, $0.001&#160;par value per share, of
    which&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    will be issued and outstanding,
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of preferred stock, $0.001&#160;par value per share, of which no
    shares will be issued and outstanding.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will adopt an amended and restated certificate of
    incorporation and amended and restated bylaws concurrently with
    the completion of this offering. The following summary of the
    capital stock and certificate of incorporation and bylaws of
    Oasis Petroleum Inc. does not purport to be complete and is
    qualified in its entirety by reference to the provisions of
    applicable law and to our amended and restated certificate of
    incorporation and amended and restated bylaws, which are filed
    as exhibits to the registration statement of which this
    prospectus is a part.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Common
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Holders of common stock are entitled to one vote for each share
    held of record on all matters submitted to a vote of the
    stockholders, and do not have cumulative voting rights. Subject
    to preferences that may be applicable to any outstanding shares
    of preferred stock, holders of common stock are entitled to
    receive ratably such dividends, if any, as may be declared from
    time to time by our board of directors out of funds legally
    available for dividend payments. All outstanding shares of
    common stock are fully paid and non-assessable, and the shares
    of common stock to be issued upon completion of this offering
    will be fully paid and non-assessable. The holders of common
    stock have no preferences or rights of conversion, exchange,
    pre-emption or other subscription rights. There are no
    redemption or sinking fund provisions applicable to the common
    stock. In the event of any liquidation, dissolution or
    <FONT style="white-space: nowrap">winding-up</FONT>
    of our affairs, holders of common stock will be entitled to
    share ratably in our assets that are remaining after payment or
    provision for payment of all of our debts and obligations and
    after liquidation payments to holders of outstanding shares of
    preferred stock, if any.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Preferred
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation authorizes our board of
    directors, subject to any limitations prescribed by law, without
    further stockholder approval, to establish and to issue from
    time to time one or more classes or series of preferred stock,
    par value $0.001 per share, covering up to an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of preferred stock. Each class or series of preferred stock will
    cover the number of shares and will have preferences, voting
    powers, qualifications and special or relative rights or
    privileges determined by the board of directors, which may
    include, among others, dividend rights, liquidation preferences,
    voting rights, conversion rights, preemptive rights and
    redemption rights.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Anti-Takeover
    Effects of Provisions of Our Certificate of Incorporation, our
    Bylaws and Delaware Law</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Some provisions of Delaware law, and our certificate of
    incorporation and our bylaws described below, will contain
    provisions that could make the following transactions more
    difficult: acquisitions of us by means of a tender offer, a
    proxy contest or otherwise; or removal of our incumbent officers
    and directors. These provisions may also have the effect of
    preventing changes in our management. It is possible that these
    provisions could make it more difficult to accomplish or could
    deter transactions that stockholders may otherwise consider to
    be in their best interest or in our best interests, including
    transactions that might result in a premium over the market
    price for our shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    These provisions, summarized below, are expected to discourage
    coercive takeover practices and inadequate takeover bids. These
    provisions are also designed to encourage persons seeking to
    acquire control of us to first negotiate with us. We believe
    that the benefits of increased protection and our potential
    ability to negotiate with the proponent of an unfriendly or
    unsolicited proposal to acquire or restructure us outweigh the
    disadvantages of discouraging these proposals because, among
    other things, negotiation of these proposals could result in an
    improvement of their terms.
</DIV>
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    <BR>
    108
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Delaware
    Law</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will be subject to the provisions of Section&#160;203 of the
    Delaware General Corporation Law, or DGCL, regulating corporate
    takeovers. In general, those provisions prohibit a Delaware
    corporation, including those whose securities are listed for
    trading on the NYSE, from engaging in any business combination
    with any interested stockholder for a period of three years
    following the date that the stockholder became an interested
    stockholder, unless:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the transaction is approved by the board of directors before the
    date the interested stockholder attained that status;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    upon consummation of the transaction that resulted in the
    stockholder becoming an interested stockholder, the interested
    stockholder owned at least 85% of the voting stock of the
    corporation outstanding at the time the transaction
    commenced;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on or after such time the business combination is approved by
    the board of directors and authorized at a meeting of
    stockholders by at least two-thirds of the outstanding voting
    stock that is not owned by the interested stockholder.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;203 defines &#147;business combination&#148; to
    include the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any merger or consolidation involving the corporation and the
    interested stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any sale, transfer, pledge or other disposition of 10% or more
    of the assets of the corporation involving the interested
    stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    subject to certain exceptions, any transaction that results in
    the issuance or transfer by the corporation of any stock of the
    corporation to the interested stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any transaction involving the corporation that has the effect of
    increasing the proportionate share of the stock of any class or
    series of the corporation beneficially owned by the interested
    stockholder;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the receipt by the interested stockholder of the benefit of any
    loans, advances, guarantees, pledges or other financial benefits
    provided by or through the corporation.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In general, Section&#160;203 defines an interested stockholder
    as any entity or person beneficially owning 15% or more of the
    outstanding voting stock of the corporation and any entity or
    person affiliated with or controlling or controlled by any of
    these entities or persons.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A Delaware corporation may &#147;opt out&#148; of
    Section&#160;203 with an express provision in its original
    certificate of incorporation or an express provision in its
    certificate of incorporation or bylaws resulting from amendments
    approved by the holders of at least a majority of the
    corporation&#146;s outstanding voting shares. We do not intend
    to &#147;opt out&#148; of the provisions of Section&#160;203.
    The statute could prohibit or delay mergers or other takeover or
    change in control attempts and, accordingly, may discourage
    attempts to acquire&#160;us.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Certificate
    of Incorporation and Bylaws</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Among other things, upon the completion of this offering, our
    certificate of incorporation and bylaws will:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    establish advance notice procedures with regard to stockholder
    proposals relating to the nomination of candidates for election
    as directors or new business to be brought before meetings of
    our stockholders. These procedures provide that notice of
    stockholder proposals must be timely given in writing to our
    corporate secretary prior to the meeting at which the action is
    to be taken. Generally, to be timely, notice must be received at
    our principal executive offices not less than 90&#160;days nor
    more than 120&#160;days prior to the first anniversary date of
    the annual meeting for the preceding year. Our bylaws specify
    the requirements as to form and content of all
    stockholders&#146; notices. These requirements may preclude
    stockholders from bringing matters before the stockholders at an
    annual or special meeting;
</TD>
</TR>

</TABLE>
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    <BR>
    109
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide our board of directors the ability to authorize
    undesignated preferred stock. This ability makes it possible for
    our board of directors to issue, without stockholder approval,
    preferred stock with voting or other rights or preferences that
    could impede the success of any attempt to change control of us.
    These and other provisions may have the effect of deferring
    hostile takeovers or delaying changes in control or management
    of our company;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that the authorized number of directors may be changed
    only by resolution of the board of directors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that all vacancies, including newly created
    directorships, may, except as otherwise required by law, be
    filled by the affirmative vote of a majority of directors then
    in office, even if less than a quorum;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at any time after OAS Holdco and its affiliates no longer own
    more than 50% of the outstanding shares of our common stock,
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that any action required or permitted to be taken by the
    stockholders must be effected at a duly called annual or special
    meeting of stockholders and may not be effected by any consent
    in writing in lieu of a meeting of such stockholders, subject to
    the rights of the holders of any series of preferred stock
    (prior to such time, provide that such actions may be taken
    without a meeting by written consent);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that directors may be removed only for cause and only by
    the affirmative vote of holders of 80% of the voting power of
    our then outstanding common stock (prior to such time, provide
    that directors may be removed only for cause and only by the
    affirmative vote of the holders of a majority of our then
    outstanding common stock);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide our certificate of incorporation and bylaws may be
    amended by the affirmative vote of the holders of at least
    two-thirds of our then outstanding common stock (prior to such
    time, provide that our certificate of incorporation and bylaws
    may be amended by the affirmative vote of the holders of a
    majority of our then outstanding common stock);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that special meetings of our stockholders may only be
    called by the board of directors, the chief executive officer or
    the chairman of the board (prior to such time provide that a
    special meeting may also be called by stockholders holding a
    majority of the outstanding shares entitled to vote);
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide for our board of directors to be divided into three
    classes of directors, with each class as nearly equal in number
    as possible, serving staggered three year terms, other than
    directors which may be elected by holders of preferred stock, if
    any. For more information on the classified board of directors,
    see &#147;Management.&#148; This system of electing and removing
    directors may tend to discourage a third party from making a
    tender offer or otherwise attempting to obtain control of us,
    because it generally makes it more difficult for stockholders to
    replace a majority of the directors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that we renounce any interest in the business
    opportunities of EnCap Investments, L.P. or any private fund
    that it manages or advises or any of its officers, directors,
    agents, stockholders, members, partners, affiliates and
    subsidiaries (other than Oasis directors that are presented
    business opportunities in their capacity as an Oasis director)
    and that they have no obligation to offer us those
    opportunities;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide that our bylaws can be amended or repealed at any
    regular or special meeting of stockholders or by the board of
    directors.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Limitation
    of Liability and Indemnification Matters</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation limits the liability of our
    directors for monetary damages for breach of their fiduciary
    duty as directors, except for liability that cannot be
    eliminated under the DGCL. Delaware law
</DIV>
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    <BR>
    110
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    provides that directors of a company will not be personally
    liable for monetary damages for breach of their fiduciary duty
    as directors, except for liabilities:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    for any breach of their duty of loyalty to us or our
    stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    for acts or omissions not in good faith or which involve
    intentional misconduct or a knowing violation of law;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    for unlawful payment of dividend or unlawful stock repurchase or
    redemption, as provided under Section&#160;174 of the
    DGCL;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    for any transaction from which the director derived an improper
    personal benefit.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any amendment, repeal or modification of these provisions will
    be prospective only and would not affect any limitation on
    liability of a director for acts or omissions that occurred
    prior to any such amendment, repeal or modification.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation and bylaws also provide that we
    will indemnify our directors and officers to the fullest extent
    permitted by Delaware law. Our certificate of incorporation and
    bylaws also permit us to purchase insurance on behalf of any
    officer, director, employee or other agent for any liability
    arising out of that person&#146;s actions as our officer,
    director, employee or agent, regardless of whether Delaware law
    would permit indemnification. We intend to enter into
    indemnification agreements with each of our current and future
    directors and officers. These agreements will require us to
    indemnify these individuals to the fullest extent permitted
    under Delaware law against liability that may arise by reason of
    their service to us, and to advance expenses incurred as a
    result of any proceeding against them as to which they could be
    indemnified. We believe that the limitation of liability
    provision in our certificate of incorporation and the
    indemnification agreements will facilitate our ability to
    continue to attract and retain qualified individuals to serve as
    directors and officers.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Transfer
    Agent and Registrar</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The transfer agent and registrar for our common stock
    is&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Listing</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect to list our common stock for quotation on the NYSE
    under the symbol &#147;OAS.&#148;
</DIV>
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    <BR>
    111
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='117'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SHARES&#160;ELIGIBLE
    FOR FUTURE SALE</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to this offering, there has been no public market for our
    common stock. Future sales of our common stock in the public
    market, or the availability of such shares for sale in the
    public market, could adversely affect market prices prevailing
    from time to time. As described below, only a limited number of
    shares will be available for sale shortly after this offering
    due to contractual and legal restrictions on resale.
    Nevertheless, sales of a substantial number of shares of our
    common stock in the public market after such restrictions lapse,
    or the perception that those sales may occur, could adversely
    affect the prevailing market price at such time and our ability
    to raise equity-related capital at a time and price we deem
    appropriate.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Sales of
    Restricted Shares</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon the closing of this offering, we will have outstanding an
    aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock. Of these shares, all of
    the&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock to be sold in this offering will be freely
    tradable without restriction or further registration under the
    Securities Act, unless the shares are held by any of our
    &#147;affiliates&#148; as such term is defined in Rule&#160;144
    of the Securities Act. All remaining shares of common stock held
    by existing stockholders will be deemed &#147;restricted
    securities&#148; as such term is defined under Rule&#160;144.
    The restricted securities were issued and sold by us in private
    transactions and are eligible for public sale only if registered
    under the Securities Act or if they qualify for an exemption
    from registration under Rule&#160;144 or Rule&#160;701 under the
    Securities Act, which rules are summarized below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a result of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements described below and the provisions of Rule&#160;144
    and Rule&#160;701 under the Securities Act, the shares of our
    common stock (excluding the shares to be sold in this offering)
    that will be available for sale in the public market are as
    follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    no shares will be eligible for sale on the date of this
    prospectus or prior to 180&#160;days after the date of this
    prospectus;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    shares will be eligible for sale upon the expiration of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements, beginning 180&#160;days after the date of this
    prospectus (subject to extension) and when permitted under
    Rule&#160;144 or Rule&#160;701;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    shares will be eligible for sale, upon exercise of vested
    options, upon the expiration of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements, beginning 180&#160;days after the date of this
    prospectus (subject to extension).
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Lock-up</FONT>
    Agreements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We, all of our directors and officers, certain of our principal
    stockholders and the selling stockholder have agreed not to sell
    or otherwise transfer or dispose of any common stock for a
    period of 180&#160;days from the date of this prospectus,
    subject to certain exceptions and extensions. See
    &#147;Underwriters&#148; for a description of these
    <FONT style="white-space: nowrap">lock-up</FONT>
    provisions.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rule&#160;144</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In general, under Rule&#160;144 as currently in effect, a person
    (or persons whose shares are aggregated) who is not deemed to
    have been an affiliate of ours at any time during the three
    months preceding a sale, and who has beneficially owned
    restricted securities within the meaning of Rule&#160;144 for a
    least six months (including any period of consecutive ownership
    of preceding non-affiliated holders) would be entitled to sell
    those shares, subject only to the availability of current public
    information about us. A non-affiliated person who has
    beneficially owned restricted securities within the meaning of
    Rule&#160;144 for at least one year would be entitled to sell
    those shares without regard to the provisions of Rule&#160;144.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A person (or persons whose shares are aggregated) who is deemed
    to be an affiliate of ours and who has beneficially owned
    restricted securities within the meaning of Rule&#160;144 for at
    least six months would be entitled to sell within any
    three-month period a number of shares that does not exceed the
    greater of one percent of the then outstanding shares of our
    common stock or the average weekly trading volume of our common
    stock reported through the New York Stock Exchange during the
    four calendar weeks preceding the
</DIV>
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    <BR>
    112
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    filing of notice of the sale. Such sales are also subject to
    certain manner of sale provisions, notice requirements and the
    availability of current public information about&#160;us.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rule&#160;701</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Employees, directors, officers, consultants or advisors who
    purchases shares from us in connection with a compensatory stock
    or option plan or other written compensatory agreement in
    accordance with Rule&#160;701 before the effective date of the
    registration statement are entitled to sell such shares
    90&#160;days after the effective date of the registration
    statement in reliance on Rule&#160;144 without having to comply
    with the holding period requirement of Rule&#160;144 and, in the
    case of non-affiliates, without having to comply with the public
    information, volume limitation or notice filing provisions of
    Rule&#160;144. The SEC has indicated that Rule&#160;701 will
    apply to typical stock options granted by an issuer before it
    becomes subject to the reporting requirements of the Exchange
    Act, along with the shares acquired upon exercise of such
    options, including exercises after the date of this prospectus.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Stock
    Issue Under Employee Plans</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to file a registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-8</FONT>
    under the Securities Act to register stock issuable under our
    Long-Term Incentive Plan. This registration statement is
    expected to be filed following the effective date of the
    registration statement of which this prospectus is a part and
    will be effective upon filing. Accordingly, shares registered
    under such registration statement will be available for sale in
    the open market following the effective date, unless such shares
    are subject to vesting restrictions with us, Rule&#160;144
    restrictions applicable to our affiliates or the
    <FONT style="white-space: nowrap">lock-up</FONT>
    restrictions described above.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Registration
    Rights</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the consummation of this offering, we expect to enter
    into a registration rights agreement with the selling
    stockholder, which will require us to file and effect the
    registration of its shares in certain circumstances no earlier
    than 180&#160;days after the date of this prospectus.
</DIV>
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    <BR>
    113
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='118'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MATERIAL
    U.S. FEDERAL INCOME AND ESTATE TAX<BR>
    CONSIDERATIONS TO
    <FONT style="white-space: nowrap">NON-U.S.</FONT>
    HOLDERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a general discussion of the material
    U.S.&#160;federal income and estate tax consequences of the
    acquisition, ownership and disposition of our common stock to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder.</FONT>
    Except as specifically provided below (see
    &#147;&#151;&#160;Estate Tax&#148;), for the purpose of this
    discussion, a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    is any beneficial owner of our common stock that is not for
    U.S.&#160;federal income tax purposes any of the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an individual citizen or resident of the U.S.;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a corporation (or other entity treated as a corporation for
    U.S.&#160;federal income tax purposes) created or organized in
    the U.S.&#160;or under the laws of the U.S.&#160;or any state or
    the District of Columbia;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a partnership (or other entity treated as a partnership or other
    pass-through entity for U.S.&#160;federal income tax purposes);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an estate whose income is subject to U.S.&#160;federal income
    tax regardless of its source;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a trust (x)&#160;whose administration is subject to the primary
    supervision of a U.S.&#160;court and which has one or more
    U.S.&#160;persons who have the authority to control all
    substantial decisions of the trust or (y)&#160;which has made a
    valid election to be treated as a U.S.&#160;person.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If a partnership (or an entity treated as a partnership for
    U.S.&#160;federal income tax purposes) holds our common stock,
    the tax treatment of a partner in the partnership will generally
    depend on the status of the partner and upon the activities of
    the partnership. Accordingly, we urge partnerships that hold our
    common stock and partners in such partnerships to consult their
    tax advisors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This discussion assumes that a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    will hold our common stock issued pursuant to the offering as a
    capital asset (generally, property held for investment). This
    discussion does not address all aspects of U.S.&#160;federal
    income taxation or any aspects of state, local or
    <FONT style="white-space: nowrap">non-U.S.&#160;taxation,</FONT>
    nor does it consider any U.S.&#160;federal income tax
    considerations that may be relevant to
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    that may be subject to special treatment under U.S.&#160;federal
    income tax laws, including, without limitation,
    U.S.&#160;expatriates, life insurance companies, tax-exempt or
    governmental organizations, dealers in securities or currency,
    banks or other financial institutions, investors whose
    functional currency is other than the U.S.&#160;dollar, and
    investors that hold our common stock as part of a hedge,
    straddle or conversion transaction. Furthermore, the following
    discussion is based on current provisions of the Internal
    Revenue Code of 1986, as amended, and Treasury Regulations and
    administrative and judicial interpretations thereof, all as in
    effect on the date hereof, and all of which are subject to
    change, possibly with retroactive effect.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We urge each prospective investor to consult a tax advisor
    regarding the U.S.&#160;federal, state, local and
    <FONT style="white-space: nowrap">non-U.S.&#160;income</FONT>
    and other tax consequences of acquiring, holding and disposing
    of shares of our common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Dividends</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have not paid any dividends on our common stock, and we do
    not plan to pay any dividends for the foreseeable future.
    However, if we do pay dividends on our common stock, those
    payments will constitute dividends for U.S.&#160;tax purposes to
    the extent paid from our current or accumulated earnings and
    profits, as determined under U.S.&#160;federal income tax
    principles. To the extent those dividends exceed our current and
    accumulated earnings and profits, the dividends will constitute
    a return of capital and will first reduce a holder&#146;s
    adjusted tax basis in the common stock, but not below zero, and
    then will be treated as gain from the sale of the common stock
    (see &#147;&#151;&#160;Gain on Disposition of Common Stock).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any dividend (out of earnings and profits) paid to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    of our common stock generally will be subject to
    U.S.&#160;withholding tax either at a rate of 30% of the gross
    amount of the dividend or such lower rate as may be specified by
    an applicable tax treaty. To receive the benefit of a reduced
    treaty rate, a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    must provide us with an IRS
    <FONT style="white-space: nowrap">Form&#160;W-8BEN</FONT>
    or other appropriate version of IRS
    <FONT style="white-space: nowrap">Form&#160;W-8</FONT>
    certifying qualification for the reduced rate.
</DIV>
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    <BR>
    114
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Dividends received by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that are effectively connected with a U.S.&#160;trade or
    business conducted by the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    are exempt from such withholding tax. To obtain this exemption,
    the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    must provide us with an IRS
    <FONT style="white-space: nowrap">Form&#160;W-8ECI</FONT>
    properly certifying such exemption. Such effectively connected
    dividends, although not subject to withholding tax, will be
    subject to U.S.&#160;federal income tax on a net income basis at
    the same graduated rates generally applicable to
    U.S.&#160;persons, net of certain deductions and credits,
    subject to any applicable tax treaty providing otherwise. In
    addition to the income tax described above, dividends received
    by corporate
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    that are effectively connected with a U.S.&#160;trade or
    business of the corporate
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    may be subject to a branch profits tax at a rate of 30% or such
    lower rate as may be specified by an applicable tax treaty.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    of our common stock may obtain a refund of any excess amounts
    withheld if the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    is eligible for a reduced rate of United States withholding tax
    and an appropriate claim for refund is timely filed with the
    Internal Revenue Service or the IRS.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Gain on
    Disposition of Common Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    generally will not be subject to U.S.&#160;federal income tax on
    any gain realized upon the sale or other disposition of our
    common stock unless:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the gain is effectively connected with a U.S.&#160;trade or
    business of the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    and, if required by an applicable tax treaty, is attributable to
    a U.S.&#160;permanent establishment maintained by such
    <FONT style="white-space: nowrap">non-U.S.&#160;holder;</FONT>
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    is an individual who is present in the United States for a
    period or periods aggregating 183&#160;days or more during the
    calendar year in which the sale or disposition occurs and
    certain other conditions are met;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we are or have been a &#147;U.S.&#160;real property holding
    corporation&#148; for U.S.&#160;federal income tax purposes and
    the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    holds or has held, directly or indirectly, at any time within
    the shorter of the five-year period preceding the disposition or
    the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    holding period, more than 5% of our common stock. Generally, a
    corporation is a United States real property holding corporation
    if the fair market value of its United States real property
    interests equals or exceeds 50% of the sum of the fair market
    value of its worldwide real property interests and its other
    assets used or held for use in a trade or business. We believe
    that we are, and will remain for the foreseeable future, a
    &#147;U.S.&#160;real property holding corporation&#148; for
    U.S.&#160;federal income tax purposes.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless an applicable tax treaty provides otherwise, gain
    described in the first bullet point above will be subject to
    U.S.&#160;federal income tax on net income basis at the same
    graduated rates generally applicable to U.S.&#160;persons.
    Corporate
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    also may be subject to a branch profits tax equal to 30% (or
    such lower rate as may be specified by an applicable tax treaty)
    of its earnings and profits that are effectively connected with
    a U.S.&#160;trade or business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Gain described in the second bullet point above (which may be
    offset by U.S.&#160;source capital losses, provided that the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    has timely filed U.S.&#160;federal income tax returns with
    respect to such losses) will be subject to a flat 30%
    U.S.&#160;federal income tax (or such lower rate as may be
    specified by an applicable tax treaty).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders</FONT>
    should consult any applicable income tax treaties that may
    provide for different rules.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Backup
    Withholding and Information Reporting</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Generally, we must report annually to the IRS the amount of
    dividends paid to each
    <FONT style="white-space: nowrap">non-U.S.&#160;holder,</FONT>
    the name and address of the recipient, and the amount, if any,
    of tax withheld with respect to those dividends. A similar
    report is sent to each
    <FONT style="white-space: nowrap">non-U.S.&#160;holder.</FONT>
    These information reporting requirements apply even if
    withholding was not required. Pursuant to tax treaties or other
    agreements, the IRS may make its reports available to tax
    authorities in the recipient&#146;s country of residence.
</DIV>
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    <BR>
    115
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Payments of dividends to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    may be subject to backup withholding (at the applicable rate)
    unless the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    establishes an exemption, for example, by properly certifying
    its
    <FONT style="white-space: nowrap">non-U.S.&#160;status</FONT>
    on an IRS
    <FONT style="white-space: nowrap">Form&#160;W-8BEN</FONT>
    or another appropriate version of IRS
    <FONT style="white-space: nowrap">Form&#160;W-8.</FONT>
    Notwithstanding the foregoing, backup withholding may apply if
    either we or our paying agent has actual knowledge, or reason to
    know, that the beneficial owner is a U.S.&#160;person that is
    not an exempt recipient.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Payments of the proceeds from sale or other disposition by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    of our common stock effected outside the U.S.&#160;by or through
    a foreign office of a broker generally will not be subject to
    information reporting or backup withholding. However,
    information reporting (but not backup withholding) will apply to
    those payments if the broker does not have documentary evidence
    that the holder is a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder,</FONT>
    an exemption is not otherwise established, and the broker has
    certain relationships with the United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Payments of the proceeds from a sale or other disposition by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    of our common stock effected by or through a U.S.&#160;office of
    a broker generally will be subject to information reporting and
    backup withholding (at the applicable rate) unless the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    establishes an exemption, for example, by properly certifying
    its
    <FONT style="white-space: nowrap">non-U.S.&#160;status</FONT>
    on an IRS
    <FONT style="white-space: nowrap">Form&#160;W-8BEN</FONT>
    or another appropriate version of IRS
    <FONT style="white-space: nowrap">Form&#160;W-8.</FONT>
    Notwithstanding the foregoing, information reporting and backup
    withholding may apply if the broker has actual knowledge, or
    reason to know, that the holder is a U.S.&#160;person that is
    not an exempt recipient.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Backup withholding is not an additional tax. Rather, the
    U.S.&#160;income tax liability of persons subject to backup
    withholding will be reduced by the amount of tax withheld. If
    withholding results in an overpayment of taxes, a refund may be
    obtained, provided that the required information is timely
    furnished to the IRS.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Estate
    Tax</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our common stock owned or treated as owned by an individual who
    is not a citizen or resident of the U.S.&#160;(as specifically
    defined for U.S.&#160;federal estate tax purposes) at the time
    of death will be includible in the individual&#146;s gross
    estate for U.S.&#160;federal estate tax purposes and may be
    subject to U.S.&#160;federal estate tax unless an applicable
    estate tax treaty provides otherwise.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Fiscal
    Year 2011 Revenue Proposals</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    President Obama&#146;s Administration has recently released
    revenue proposals in &#147;General Explanations of the
    Administration&#146;s Fiscal 2011 Revenue Proposals&#148; that
    would limit the ability of
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    to claim relief from U.S.&#160;withholding tax in respect of
    dividends paid on our common stock, if such holders hold our
    common stock through a
    <FONT style="white-space: nowrap">non-U.S.&#160;financial</FONT>
    institution that is not a &#147;qualified intermediary.&#148;
    The Administration&#146;s proposals also would limit the ability
    of certain
    <FONT style="white-space: nowrap">non-U.S.&#160;entities</FONT>
    that are
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    to claim relief from U.S.&#160;withholding tax in respect of
    dividends paid by us to such
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    unless those entities certify that no U.S.&#160;person owns,
    directly or indirectly, an interest of more than ten percent or
    provide the name, address, and tax identification number of each
    substantial U.S.&#160;owner to the withholding agent. A
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    generally would be permitted to claim a refund to the extent any
    tax withheld exceeded the holder&#146;s actual tax liability. It
    is unclear whether, or in what form, these proposals may be
    enacted.
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders</FONT>
    are encouraged to consult with their tax advisers regarding the
    possible implications of the Administration&#146;s proposals on
    their investment in respect of the common stock.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    116
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='119'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">UNDERWRITERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the terms and subject to the conditions contained in an
    underwriting agreement dated the date of this prospectus, the
    underwriters named below, for whom Morgan Stanley&#160;&#038;
    Co. Incorporated and UBS Securities LLC are acting as
    representatives, have severally agreed to purchase, and we and
    the selling stockholder have agreed to sell to them, severally,
    the number of shares indicated below:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Number of Shares</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Morgan Stanley&#160;&#038; Co. Incorporated
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    UBS Securities LLC
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Simmons&#160;&#038; Company International
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 10pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 10pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 10pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters and the representatives are collectively
    referred to as the &#147;underwriters&#148; and the
    &#147;representatives,&#148; respectively. The underwriters are
    offering the shares of common stock subject to their acceptance
    of the shares from us and the selling stockholder and subject to
    prior sale. The underwriting agreement provides that the
    obligations of the several underwriters to pay for and accept
    delivery of the shares of common stock offered by this
    prospectus are subject to the approval of certain legal matters
    by their counsel and to certain other conditions. The
    underwriters are obligated to take and pay for all of the shares
    of common stock offered by this prospectus if any such shares
    are taken. However, the underwriters are not required to take or
    pay for the shares covered by the underwriters&#146;
    over-allotment option described below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The per share price of any shares sold by the underwriters shall
    be the public offering price listed on the cover page of this
    prospectus, in United States dollars, less an amount not greater
    than the per share amount of the concession to dealers described
    below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters initially propose to offer part of the shares
    of common stock directly to the public at the public offering
    price listed on the cover page of this prospectus and part to
    certain dealers at a price that represents a concession not in
    excess of $&#160;&#160;&#160;&#160;&#160; a share under the
    public offering price. Any underwriter may allow, and such
    dealers may reallow, a concession not in excess of
    $&#160;&#160;&#160;&#160;&#160; a share to other underwriters or
    to certain dealers. After the initial offering of the shares of
    common stock, the offering price and other selling terms may
    from time to time be varied by the representatives.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We and the selling stockholder have granted to the underwriters
    an option, exercisable for 30&#160;days from the date of this
    prospectus, to purchase up to an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    additional shares of common stock at the public offering price
    listed on the cover page of this prospectus, less underwriting
    discounts and commissions. The underwriters may exercise this
    option solely for the purpose of covering over-allotments, if
    any, made in connection with the offering of the shares of
    common stock offered by this prospectus. To the extent the
    option is exercised, each underwriter will become obligated,
    subject to certain conditions, to purchase about the same
    percentage of the additional shares of common stock as the
    number listed next to the underwriter&#146;s name in the
    preceding table bears to the total number of shares of common
    stock listed next to the names of all underwriters in the
    preceding table. If the underwriters&#146; option is exercised
    in full, the total price to the public would be
    $&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    the total underwriters&#146; discounts and commissions would be
    $&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    the total proceeds to us would be
    $&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    and the total proceeds to the selling stockholder would be
    $&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    117
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table shows the per share and total underwriting
    discounts and commissions to be paid to the underwriters by us
    and by the selling stockholder. These amounts are shown assuming
    no exercise and full exercise of the underwriters&#146; option
    to purchase additional shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="53%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Paid by Us</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Paid by the Selling Stockholder</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>No Exercise</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Full Exercise</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>No Exercise</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Full Exercise</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Per Share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We estimate that the expenses of the offering, not including
    underwriting discounts and commissions, will be approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    all of which will be paid by&#160;us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters have informed us that they do not intend sales
    to discretionary accounts to exceed 5% of the total number of
    shares of common stock offered by them.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect to list our common stock for quotation on the NYSE
    under the symbol &#147;OAS.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We, all of our directors and officers, certain of our principal
    stockholders and the selling stockholder have agreed that,
    without the prior written consent of Morgan Stanley&#160;&#038;
    Co. Incorporated and UBS Securities LLC and subject to certain
    exceptions, on behalf of the underwriters, we and they will not,
    during the period ending 180&#160;days after the date of this
    prospectus:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    offer, pledge, sell, contract to sell, sell any option or
    contract to purchase, purchase any option or contract to sell,
    grant any option, right or warrant to purchase, lend or
    otherwise transfer or dispose of, directly or indirectly, any
    shares of common stock or any securities convertible into or
    exercisable or exchangeable for common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into any swap or other arrangement that transfers to
    another, in whole or in part, any of the economic consequences
    of ownership of the common stock;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    file any registration statement with the SEC relating to the
    offering of any shares of common stock or any securities
    convertible into or exercisable or exchangeable for common stock;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    whether any such transaction described above is to be settled by
    delivery of common stock or such other securities, in cash or
    otherwise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The restrictions described in the immediately preceding
    paragraph shall not apply&#160;to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the sale of shares to the underwriters pursuant to the
    underwriting agreement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the issuance by us of shares of common stock upon the exercise
    of an option or a warrant or the conversion of a security
    outstanding on the date of this prospectus of which the
    underwriters have been advised in writing;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    transactions by any person other than us relating to shares of
    common stock or other securities acquired in open market
    transactions after the completion of the offering of the shares;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    transfers by the selling stockholder of shares of common stock
    or any other security convertible into shares of our common
    stock as a bona fide gift or in connection with bona fide estate
    planning;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    distributions by the selling stockholder of shares of common
    stock or any other security convertible into shares of our
    common stock to limited partners, members or stockholders of
    such selling stockholder, subject to certain restrictions.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The <FONT style="white-space: nowrap">180-day</FONT>
    restricted period described in the preceding paragraph will be
    automatically extended&#160;if:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    during the last 17&#160;days of the
    <FONT style="white-space: nowrap">180-day</FONT>
    restricted period we issue an earnings release or material news
    or announce material event relating to us occurs;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    prior to the expiration of the
    <FONT style="white-space: nowrap">180-day</FONT>
    restricted period, we announce that we will release earnings
    results during the
    <FONT style="white-space: nowrap">16-day</FONT>
    period beginning on the last day of the
    <FONT style="white-space: nowrap">180-day</FONT>
    restricted period;
</TD>
</TR>

</TABLE>
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    <BR>
    118
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    in which case the restrictions described in the preceding
    paragraph will continue to apply until the expiration of the
    <FONT style="white-space: nowrap">18-day</FONT>
    period beginning on the issuance of the earnings release or the
    occurrence of the material news or material event.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In order to facilitate the offering of the common stock, the
    underwriters may engage in transactions that stabilize, maintain
    or otherwise affect the price of the common stock. Specifically,
    the underwriters may over-allot in connection with the offering,
    creating a short position in the common stock for their own
    account. In addition, to cover over-allotments or to stabilize
    the price of the common stock, the underwriters may bid for, and
    purchase, shares of common stock in the open market. Finally,
    the underwriting syndicate may reclaim selling concessions
    allowed to an underwriter or a dealer for distributing the
    common stock in the offering, if the syndicate repurchases
    previously distributed common stock in transactions to cover
    syndicate short positions, in stabilization transactions or
    otherwise. Any of these activities may stabilize or maintain the
    market price of the common stock above independent market
    levels. The underwriters are not required to engage in these
    activities, and may end any of these activities at any time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We, the selling stockholder, certain of its affiliates and the
    underwriters have agreed to indemnify each other against certain
    liabilities, including liabilities under the Securities Act.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Directed
    Share Program Prospectus Disclosure</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At our request, the underwriters have reserved for sale, at the
    initial offering price, up
    to&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    offered hereby for directors, officers, employees, consultants,
    business associates, and related persons associated with us. The
    sale of the reserved shares to these purchasers will be made by
    Morgan Stanley&#160;&#038; Co. Incorporated. The number of
    shares of common stock available for sale to the general public
    will be reduced to the extent such persons purchase such
    reserved shares. Any reserved shares which are not so purchased
    will be offered by the underwriters to the general public on the
    same basis as the other shares offered by this prospectus. We
    have agreed to indemnify Morgan Stanley&#160;&#038; Co.
    Incorporated in connection with the directed share program,
    including for the failure of any participant to pay for its
    shares.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Pricing
    of the Offering</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to this offering, there has been no public market for our
    common stock. The initial public offering price is determined by
    negotiations between us, the selling stockholder and the
    representatives. Among the factors to be considered in
    determining the initial public offering price will be the
    information set forth in this prospectus, our history and
    prospects, the history of and prospects for our industry in
    general, our sales, earnings and certain other financial and
    operating information in recent periods, and the price-earnings
    ratios, price-sales ratios, market prices of securities, certain
    financial and operating information of companies engaged in
    activities similar to ours and other factors deemed relevant by
    the underwriters, the selling stockholder and us. The estimated
    initial public offering price range set forth on the cover page
    of the preliminary prospectus is subject to change as a result
    of market conditions and other factors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Relationships
    with Underwriters</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    From time to time in the ordinary course of business, certain of
    the underwriters and their respective affiliates have performed,
    and may in the future perform, various commercial banking,
    investment banking and other financial services for us for which
    they received, or will receive, customary fees and reimbursement
    of expenses. In particular, Simmons&#160;&#038; Company
    International has provided, and may in the future provide
    financial advisory services for which services it has received,
    and may in the future receive, customary fees and reimbursement
    of expenses. In addition, an affiliate of UBS Securities LLC
    serves as a lender under our revolving credit facility and will
    therefore receive its respective share of any repayment by us of
    amounts outstanding under our revolving credit facility from the
    net proceeds of this offering. However, this affiliate will
    receive less than 5% of the total net proceeds (not including
    underwriting compensation) from this offering.
</DIV>
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    <BR>
    119
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='120'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">LEGAL
    MATTERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The validity of our common stock offered by this prospectus will
    be passed upon for Oasis Petroleum Inc., by Vinson&#160;&#038;
    Elkins L.L.P., Houston, Texas. Certain legal matters in
    connection with this offering will be passed upon for the
    underwriters by Andrews Kurth LLP, Houston, Texas.
</DIV>

<A name='121'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">EXPERTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The consolidated financial statements of Oasis Petroleum LLC as
    of December&#160;31, 2009 and 2008 and for the period from
    February&#160;26, 2007 (inception) to December&#160;31, 2007 and
    for each of the two years ended December&#160;31, 2009 included
    in this prospectus have been so included in reliance on the
    report of PricewaterhouseCoopers LLP, an independent registered
    public accounting firm, given on the authority of said firm as
    experts in auditing and accounting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The balance sheet of Oasis Petroleum Inc. as of
    February&#160;25, 2010 included in this prospectus has been so
    included in reliance on the report of PricewaterhouseCoopers
    LLP, an independent registered public accounting firm, given on
    the authority of said firm as experts in auditing and accounting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Statement of Revenues and Direct Operating Expenses of the
    Bill Barrett Corporation Acquisition Properties, the predecessor
    to Oasis Petroleum LLC, for the six month period ended
    June&#160;30, 2007 and the Statement of Revenues and Direct
    Operating Expenses of the Kerogen Acquisition Properties for the
    year ended December&#160;31, 2008 included in this prospectus
    have been so included in reliance on the reports of
    PricewaterhouseCoopers LLP, an independent registered public
    accounting firm, given on the authority of said firm as experts
    in auditing and accounting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The information included in this prospectus regarding estimated
    quantities of proved reserves, the future net revenues from
    those reserves and their present value is based, in part, on
    estimates of the proved reserves and present values of proved
    reserves as of December&#160;31, 2007, 2008 and 2009. The
    reserve estimates at December&#160;31, 2007 and 2008 are based
    on reports prepared by W.D. Von Gonten&#160;&#038; Co.,
    independent reserve engineers. The reserve estimates at
    December&#160;31, 2009 are based on a report prepared by
    DeGolyer and MacNaughton, independent reserve engineers. These
    estimates are included in this prospectus in reliance upon the
    authority of such firms as experts in these matters.
</DIV>

<A name='122'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">WHERE YOU
    CAN FIND MORE INFORMATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have filed with the SEC a registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    (including the exhibits, schedules and amendments thereto) under
    the Securities Act, with respect to the shares of our common
    stock offered hereby. This prospectus does not contain all of
    the information set forth in the registration statement and the
    exhibits and schedules thereto. For further information with
    respect to us and the common stock offered hereby, we refer you
    to the registration statement and the exhibits and schedules
    filed therewith. Statements contained in this prospectus as to
    the contents of any contract, agreement or any other document
    are summaries of the material terms of this contract, agreement
    or other document. With respect to each of these contracts,
    agreements or other documents filed as an exhibit to the
    registration statement, reference is made to the exhibits for a
    more complete description of the matter involved. A copy of the
    registration statement, and the exhibits and schedules thereto,
    may be inspected without charge at the public reference
    facilities maintained by the SEC at 100&#160;F&#160;Street NE,
    Washington,&#160;D.C. 20549. Copies of these materials may be
    obtained, upon payment of a duplicating fee, from the Public
    Reference Section of the SEC at 100&#160;F&#160;Street NE,
    Washington,&#160;D.C. 20549. Please call the SEC at
    <FONT style="white-space: nowrap">1-800-SEC-0330</FONT>
    for further information on the operation of the public reference
    facility. The SEC maintains a website that contains reports,
    proxy and information
</DIV>
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    <BR>
    120
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    statements and other information regarding registrants that file
    electronically with the SEC. The address of the SEC&#146;s
    website is
    <I><FONT style="white-space: nowrap">http://www.sec.gov</FONT></I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After we have completed this offering, we will file annual,
    quarterly and current reports, proxy statements and other
    information with the SEC. We expect to have an operational
    website concurrently with the completion of this offering and we
    expect to make our periodic reports and other information filed
    with or furnished to the SEC available, free of charge, through
    our website, as soon as reasonably practicable after those
    reports and other information are electronically filed with or
    furnished to the SEC. Information on our website or any other
    website is not incorporated by reference into this prospectus
    and does not constitute a part of this prospectus. You may read
    and copy any reports, statements or other information on file at
    the public reference rooms. You can also request copies of these
    documents, for a copying fee, by writing to the SEC, or you can
    review these documents on the SEC&#146;s website, as described
    above. In addition, we will provide electronic or paper copies
    of our filings free of charge upon request.
</DIV>
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    <BR>
    121
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='123'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Index to
    Financial Statements</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="97%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Oasis Petroleum LLC</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#300'>Report of Independent Registered Public
    Accounting Firm</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#301'>Consolidated Balance Sheets at December&#160;31,
    2009 and 2008</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#302'>Consolidated Statements of Operations for the
    Years Ended December&#160;31, 2009, 2008 and for the Period from
    February&#160;26, 2007 (Inception)&#160;to December&#160;31,
    2007</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#303'>Consolidated Statements of Changes in
    Members&#146; Equity for the Years Ended December&#160;31, 2009,
    2008 and for the Period from February&#160;26,
    2007&#160;(Inception) to December&#160;31, 2007</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#304'>Consolidated Statements of Cash Flows for the
    Years Ended December&#160;31, 2009, 2008 and for the Period from
    February&#160;26, 2007&#160;(Inception) to December&#160;31,
    2007</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-6
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#305'>Notes to Consolidated Financial Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-7
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Oasis Petroleum Inc.</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#306'>Report of Independent Registered Public
    Accounting Firm</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-33
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#307'>Balance Sheet at February&#160;25, 2010</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-34
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#308'>Notes to Balance Sheet</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-35
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Bill Barrett Corporation Acquisition Properties (as
    Predecessor)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#309'>Report of Independent Registered Public
    Accounting Firm</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-36
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#310'>Statement of Revenues and Direct Operating
    Expenses for the Six Months Ended June&#160;30, 2007</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-37
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#311'>Notes to Statement of Revenues and Direct
    Operating Expenses</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Kerogen Acquisition Properties</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#312'>Report of Independent Registered Public
    Accounting Firm</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-41
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#313'>Statements of Revenues and Direct Operating
    Expenses for the Year Ended December&#160;31, 2008 (audited) and
    for the Three Months Ended March&#160;31, 2009 and 2008
    (unaudited)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#314'>Notes to Statements of Revenues and Direct
    Operating Expenses</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-43
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Kerogen Acquisition Properties</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#315'>Unaudited Pro Forma Financial Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-46
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='300'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Report of
    Independent Registered Public Accounting Firm</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the Board of Managers of Oasis Petroleum LLC:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In our opinion, the accompanying consolidated balance sheets and
    the related consolidated statements of operations, members&#146;
    equity, and cash flows present fairly, in all material respects,
    the financial position of Oasis Petroleum LLC and its
    subsidiaries (the &#147;Company&#148;) at December&#160;31, 2009
    and 2008, and the results of their operations and their cash
    flows for the years ended December&#160;31, 2009 and 2008, and
    for the period from February&#160;26, 2007 (inception) to
    December&#160;31, 2007, in conformity with accounting principles
    generally accepted in the United States of America. These
    financial statements are the responsibility of the
    Company&#146;s management. Our responsibility is to express an
    opinion on these financial statements based on our audits. We
    conducted our audits of these statements in accordance with the
    standards of the Public Company Accounting Oversight Board
    (United States). Those standards require that we plan and
    perform the audit to obtain reasonable assurance about whether
    the financial statements are free of material misstatement. An
    audit includes examining, on a test basis, evidence supporting
    the amounts and disclosures in the financial statements,
    assessing the accounting principles used and significant
    estimates made by management, and evaluating the overall
    financial statement presentation. We believe that our audits
    provide a reasonable basis for our opinion.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    /s/ PricewaterhouseCoopers LLP
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Houston, Texas
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    March&#160;4, 2010
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC <BR>
    <!-- XBRL,bs --><A name='301'> <BR>
    Consolidated Balance Sheet</FONT></B>
</DIV>
</A>
<!-- XBRL,body -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="79%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD colspan="9" align="center" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>ASSETS</B>
</DIV>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    40,562
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,570
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accounts receivable&#160;&#151; oil and gas revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,142
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    794
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accounts receivable&#160;&#151; joint interest partners
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,219
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Inventory
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,258
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,569
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Prepaid expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    134
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    94
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Advances to joint interest partners
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,605
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,274
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    219
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,284
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57,170
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,804
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Property, plant and equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Oil and gas properties (successful efforts method)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    243,350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    159,821
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Other properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    866
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    747
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Less: accumulated depreciation, depletion, amortization and
    impairment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (62,643
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (46,348
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total property, plant and equipment, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    181,573
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    114,220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    806
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Deferred costs and other assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    810
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    238
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    239,553
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    129,068
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="9">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD colspan="9" align="center" valign="bottom">
    <B>LIABILITIES AND MEMBERS&#146; EQUITY</B>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accounts payable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,577
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,573
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Advances from joint interest partners
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    589
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    206
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Production taxes and royalties payable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,563
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    507
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accrued liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,038
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,716
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accrued interest payable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    144
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,087
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total current liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23,998
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,003
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Long-term debt
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Asset retirement obligations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,511
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,458
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,085
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    109
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    67,703
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46,609
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Commitments and contingencies (see Note&#160;10)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Members&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Capital contributions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    235,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    130,400
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accumulated loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (63,150
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (47,941
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total members&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    171,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82,459
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total liabilities and members&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    239,553
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    129,068
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying notes are an integral part of these
    consolidated financial statements.
</DIV>
<!-- /XBRL,bs -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    <!-- XBRL,op --><A name='302'> <BR>
    Consolidated Statement of Operations<BR>
    </FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL,body -->
<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="64%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Oil and gas revenues</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,755
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,736
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,791
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Expenses</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Lease operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,691
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,073
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,946
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,810
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,001
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,211
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,670
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,185
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploration expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,222
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Rig termination
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Impairment of oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,117
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,177
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gain on sale of properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    General and administrative expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,342
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,452
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,181
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,310
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    74,551
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,864
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,555
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (39,815
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (73
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Other income (expense)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Change in unrealized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14,769
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (10,679
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Realized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,932
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,062
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,404
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,776
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,654
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,424
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,477
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Net loss</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (34,391
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (13,550
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying notes are an integral part of these
    consolidated financial statements.
</DIV>
<!-- /XBRL,op -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    <!-- XBRL,se --><A name='303'> <BR>
    Consolidated Statement of Members&#146;
    Equity</FONT></B><FONT style="font-family: 'Times New Roman', Times">
    </FONT>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL,body -->
<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="88%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Members&#146; Equity, February&#160;26, 2007 (Inception)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Capital Contributions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    49,900
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net Loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,550
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Members&#146; Equity, December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36,350
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Capital Contributions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    80,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net Loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (34,391
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Members&#146; Equity, December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    82,459
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Capital Contributions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    104,600
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net Loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Members&#146; Equity, December&#160;31, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    171,850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying notes are an integral part of these
    consolidated financial statements.
</DIV>
<!-- /XBRL,se -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    <!-- XBRL,cf --><A name='304'> <BR>
    Consolidated Statement of Cash Flows<BR>
    </FONT></B>
</DIV>
</A>
<!-- XBRL,body -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="65%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Cash Flows from Operating Activities:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (34,391
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (13,550
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Adjustments to reconcile net loss to net cash provided by
    operating activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,670
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,185
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Exploration expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,280
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Impairment of oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,117
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,177
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Gain on sale of properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,747
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,837
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,741
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Debt discount amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    95
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    107
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    61
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Working capital and other changes:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Change in accounts receivable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,409
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (988
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,008
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Change in inventory
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (218
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,191
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (505
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Change in prepaid expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (40
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (88
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Change in other assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (667
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Change in accounts payable and accrued liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,440
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    968
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,235
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Change in other liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (39
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Net cash provided by operating activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,148
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,766
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,284
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Cash flows from investing activities:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Capital expenditures
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (47,396
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (70,427
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (8,876
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Acquisition of oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (35,215
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (82,010
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Derivative settlements
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,932
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,062
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Advances to joint interest partners
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,331
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,430
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (40
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Advances from joint interest partners
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    383
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    206
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Proceeds from equipment and property sales
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,507
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    105
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Net cash used in investing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (80,756
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (78,478
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (91,988
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Cash flows from financing activities:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Proceeds from members&#146; contributions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    104,600
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    80,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    49,900
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Proceeds from issuance of debt
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,750
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Reduction in debt
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,000
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (27,250
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Debt issuance costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (414
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Net cash provided by financing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    113,600
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    95,986
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Increase (decrease) in cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,992
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,712
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,282
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Cash and cash equivalents</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Beginning of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,570
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,282
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    End of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    40,562
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,570
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,282
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Supplemental cash flow Information:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash interest paid
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    674
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,485
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,526
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Supplemental non-cash transactions:</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accrued capital expenditures
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,134
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8,173
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,425
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Asset retirement obligations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,156
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    410
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,712
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying notes are an integral part of these
    consolidated financial statements.
</DIV>
<!-- /XBRL,cf -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-6
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->
<!-- XBRL,ns -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='305'><B><FONT style="font-family: 'Times New Roman', Times">Notes
    to Consolidated Financial Statements</FONT></B></A>
</DIV>
</A>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">1.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Organization
    and Operations of the Company</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Organization</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oasis Petroleum LLC (&#147;Oasis&#148; or &#147;Company&#148;)
    was formed as a Delaware limited liability company on
    February&#160;26, 2007 by certain members of the Company&#146;s
    senior management team, through Oasis Petroleum Management LLC
    as described below, and private equity funds managed by EnCap
    Investments LLC (&#147;EnCap&#148;). EnCap, which was formed in
    1988, provides private equity funding to independent oil and gas
    companies. As of December&#160;31, 2009, EnCap was the majority
    holder and controlling member of the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company entered into a limited liability company agreement
    dated March&#160;5, 2007 (the &#147;Oasis Agreement&#148;) that
    provided for a maximum $100&#160;million of capital
    contributions from EnCap and other members during a commitment
    period that extended from March&#160;5, 2007 until
    March&#160;10, 2010, unless extended by mutual agreement of
    EnCap and the Company (the &#147;Commitment Period&#148;). The
    Oasis Agreement was amended on November&#160;1, 2007 to increase
    the maximum amount of capital contribution commitment from its
    members to $200&#160;million. On December&#160;1, 2009, the
    Oasis Agreement was further amended to extend the Commitment
    Period to December&#160;31, 2011 and to increase the maximum
    amount of capital contribution commitment from its members to
    $275&#160;million. The Company had $40&#160;million of remaining
    capital commitment capacity under the Oasis Agreement, as
    amended, as of December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oasis Petroleum Management LLC (&#147;OPM&#148;), a Delaware
    limited liability company, was formed in February 2007 to allow
    Company employees to become indirect investors in the Company.
    OPM does not charge the Company management fees since all OPM
    investors are Oasis employees who receive compensation directly
    from the Company for their employment services. In April 2008,
    the Company formed Oasis Petroleum International LLC
    (&#147;OPI&#148;), a Delaware limited liability company, to
    conduct business development activities outside of the United
    States of America. OPI currently has no assets or business
    activities.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Nature
    of Business</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company is an independent exploration and production company
    focused on the acquisition and development of unconventional oil
    and natural gas resources primarily in the Williston Basin. All
    of the Company&#146;s assets, which consist of proved and
    unproved oil and natural gas properties located primarily in the
    Montana and North Dakota areas of the Williston Basin, are owned
    by Oasis Petroleum North America LLC (&#147;OPNA&#148;), a
    wholly owned subsidiary of the Company, which was formed on
    May&#160;17, 2007 as a Delaware limited liability company.
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">2.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    of Significant Accounting Policies</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Basis
    of Presentation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying consolidated financial statements of the
    Company include the accounts of Oasis and its wholly owned
    subsidiaries OPI and OPNA. These statements have been prepared
    in accordance with accounting principles generally accepted in
    the United States of America (&#147;GAAP&#148;). All significant
    intercompany transactions have been eliminated in consolidation.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Use of
    Estimates</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Preparation of the Company&#146;s consolidated financial
    statements in accordance with GAAP requires management to make
    estimates and assumptions that affect the reported amounts of
    assets and liabilities at the date of the consolidated financial
    statements and the reported amounts of revenues and expenses
    during the reporting period. The most significant estimates
    pertain to proved oil and natural gas reserves and related cash
    flow estimates used in impairment tests of long-lived assets,
    estimates of future development, dismantlement
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-7
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    and abandonment costs, estimates relating to certain oil and
    natural gas revenues and expenses and estimates of expenses
    related to legal, environmental and other contingencies. Certain
    of these estimates require assumptions regarding future
    commodity prices, future costs and expenses and future
    production rates. Actual results could differ from those
    estimates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As an oil and natural gas producer, the Company&#146;s revenue,
    profitability and future growth are substantially dependent upon
    the prevailing and future prices for oil and natural gas, which
    are dependent upon numerous factors beyond its control such as
    economic, political and regulatory developments and competition
    from other energy sources. The energy markets have historically
    been very volatile and there can be no assurance that oil and
    natural gas prices will not be subject to wide fluctuations in
    the future. A substantial or extended decline in oil and natural
    gas prices could have a material adverse effect on the
    Company&#146;s financial position, results of operations, cash
    flows and quantities of oil and natural gas reserves that may be
    economically produced.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Estimates of oil and natural gas reserves and their values,
    future production rates and future costs and expenses are
    inherently uncertain for numerous reasons, including many
    factors beyond the Company&#146;s control. Reservoir engineering
    is a subjective process of estimating underground accumulations
    of oil and natural gas that cannot be measured in an exact
    manner. The accuracy of any reserve estimate is a function of
    the quality of data available and of engineering and geological
    interpretation and judgment. In addition, estimates of reserves
    may be revised based on actual production, results of subsequent
    exploitation and development activities, prevailing commodity
    prices, operating cost and other factors. These revisions may be
    material and could materially affect future depletion,
    depreciation and amortization expense, dismantlement and
    abandonment costs, and impairment expense.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Cash
    and Cash Equivalents</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All short-term investments purchased with an original maturity
    of three months or less are considered cash equivalents. The
    Company&#146;s short-term investments are composed of overnight
    bank transfers of funds from bank accounts to an offshore United
    States Dollar denominated interest bearing account. Invested
    funds and earned interest amounts are returned to the
    Company&#146;s accounts the next business day. Cash equivalents
    are stated at cost, which approximates market value.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Accounts
    Receivable</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Accounts receivable are carried on a gross basis, with no
    discounting. The Company regularly reviews all aged accounts
    receivable for collectability and establishes an allowance as
    necessary for individual customer balances. No allowance for
    doubtful accounts was recorded for the years ended
    December&#160;31, 2009 and 2008.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Inventory</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Equipment and materials consist primarily of tubular goods and
    well equipment to be used in future drilling or repair
    operations and are stated at the lower of cost or market with
    cost determined on an average cost method. Crude oil inventories
    are valued at the lower of average cost or market value.
    Inventory consists of the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Equipment and materials
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    588
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,117
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Crude oil inventory
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    670
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    452
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,258
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,569
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-8
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Joint
    Interest Partner Advances</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company participates in the drilling of oil and gas wells
    with other working interest partners. Due to the capital
    intensive nature of oil and natural gas drilling activities, the
    working interest partner responsible for conducting the drilling
    operations may request advance payments from other working
    interest partners for their share of the costs. The Company
    expects such advances to be applied by working interest partners
    against joint interest billings for its share of drilling
    operations within 90&#160;days from when the advance is paid.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Property,
    Plant and Equipment</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Proved
    Oil and Gas Properties</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oil and natural gas exploration and development activities are
    accounted for using the successful efforts method. Under this
    method, all property acquisition costs and costs of exploratory
    and development wells are capitalized when incurred, pending
    determination of whether the well has found proved reserves. If
    an exploratory well does not find proved reserves, the costs of
    drilling the well are charged to expense. The costs of
    development wells are capitalized whether productive or
    nonproductive. All capitalized well costs and leasehold costs of
    proved properties are amortized on a
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    basis over the remaining life of proved developed reserves and
    proved reserves, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The provision for depreciation, depletion and amortization
    (&#147;DD&#038;A&#148;) of oil and natural gas properties is
    calculated on a
    <FONT style="white-space: nowrap">field-by-field</FONT>
    basis using the
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    method. Natural gas is converted to barrel equivalents at the
    rate of six thousand cubic feet of natural gas to one barrel of
    oil. The calculation for the
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    DD&#038;A method takes into consideration estimated future
    dismantlement, restoration and abandonment costs, which are net
    of estimated salvage values.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Costs of retired, sold or abandoned properties that constitute a
    part of an amortization base (partial field) are charged or
    credited, net of proceeds, to accumulated depreciation,
    depletion and amortization unless doing so significantly affects
    the
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    amortization rate for an entire field, in which case a gain or
    loss is recognized currently. In December 2009, the Company sold
    its interests in non-core oil and natural gas producing
    properties located in the Barnett shale in Texas for an
    aggregate $1.5&#160;million in cash. The Company recognized a
    gain of $1.4&#160;million from the sale of these divested
    properties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Expenditures for maintenance, repairs and minor renewals
    necessary to maintain properties in operating condition are
    expensed as incurred. Major betterments, replacements and
    renewals are capitalized to the appropriate property and
    equipment accounts. Estimated dismantlement and abandonment
    costs for oil and natural gas properties are capitalized, net of
    salvage, at their estimated net present value and amortized on a
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    basis over the remaining life of the related proved developed
    reserves.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company reviews its proved oil and natural gas properties
    for impairment whenever events and circumstances indicate that a
    decline in the recoverability of their carrying value may have
    occurred. The Company estimates the expected undiscounted future
    cash flows of its oil and natural gas properties and compares
    such undiscounted future cash flows to the carrying amount of
    the oil and natural gas properties to determine if the carrying
    amount is recoverable. If the carrying amount exceeds the
    estimated undiscounted future cash flows, the Company will
    adjust the carrying amount of the oil and natural gas properties
    to fair value. The factors used to determine fair value are
    subject to management&#146;s judgement and expertise and
    include, but are not limited to, recent sales prices of
    comparable properties, the present value of future cash flows,
    net of estimated operating and development costs using estimates
    of proved reserves, future commodity pricing, future production
    estimates, anticipated capital expenditures and various discount
    rates commensurate with the risk and current market conditions
    associated with realizing the expected cash flows projected.
    During the years ended December&#160;31, 2009 and 2008, the
    Company recorded a $0.8&#160;million and a $45.5&#160;million
    non-cash impairment charge, respectively, on its proved oil and
    natural gas properties. No impairment on proved oil and natural
    gas properties was recorded for the period ended
    December&#160;31, 2007.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-9
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Unproved
    Oil and Gas Properties</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unproved properties consist of costs incurred to acquire
    unproved leases (&#147;lease acquisition costs&#148;). Unproved
    lease acquisition costs are capitalized until the leases expire
    or when the Company specifically identifies leases that will
    revert to the lessor, at which time the Company expenses the
    associated unproved lease acquisition costs. The expensing of
    the unproved lease acquisition costs is recorded as Impairment
    of Oil and Gas Properties in the Consolidated Statement of
    Operations. Lease acquisition costs related to successful
    exploratory drilling are reclassified to proved properties and
    depleted on a
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    basis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company assesses its unproved properties periodically for
    impairment on a
    <FONT style="white-space: nowrap">property-by-property</FONT>
    basis based on remaining lease terms, drilling results or future
    plans to develop acreage and records impairment expense for any
    decline in value. As a result of expiring unproved property
    leases, the Company recorded non-cash impairment charges of
    $5.4&#160;million, $1.6&#160;million and $1.2&#160;million for
    the years ended December&#160;31, 2009 and 2008 and the period
    ended December&#160;31, 2007, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For sales of entire working interests in unproved properties,
    gain or loss is recognized to the extent of the difference
    between the proceeds received and the net carrying value of the
    property. Proceeds from sales of partial interests in unproved
    properties are accounted for as a recovery of costs unless the
    proceeds exceed the entire cost of the property.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Other
    Property and Equipment</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Furniture, equipment and leasehold improvements are recorded at
    cost and are depreciated on the straight-line method based on
    expected lives of the individual assets. The Company uses a five
    year period as the estimated life for these types of assets. The
    cost of assets disposed of and the associated accumulated
    depletion, depreciation and amortization are removed from the
    Company&#146;s Consolidated Balance Sheet with any gain or loss
    realized upon the sale or disposal included in the
    Company&#146;s Consolidated Statement of Operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth the Company&#146;s property,
    plant and equipment:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="79%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    195,546
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    115,439
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Less: Accumulated depreciation, depletion, amortization and
    impairment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (62,330
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (46,188
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved oil and gas properties, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    133,216
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69,251
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Unproved oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,804
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44,382
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other property and equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    866
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    747
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Less: Accumulated depreciation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (313
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (160
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Other property and equipment, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    553
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    587
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total property, plant and equipment, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    181,573
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    114,220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Exploration
    Expenses</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Costs from drilling exploratory wells are initially capitalized,
    but charged to expense if and when a well is determined to be
    unsuccessful. Determination is usually made on or shortly after
    drilling or completing the well, however, in certain situations
    a determination cannot be made when drilling is completed. The
    Company defers capitalized exploratory drilling costs for wells
    that have found a sufficient quantity of producible hydrocarbons
    but cannot be classified as proved because they are located in
    areas that require major capital expenditures or governmental or
    other regulatory approvals before production can begin. These
    costs continue
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-10
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    to be deferred as wells-in-progress as long as development is
    underway, is firmly planned for the near future or the necessary
    approvals are actively being sought.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Other exploration costs, including certain geological and
    geophysical expenses and delay rentals for oil and gas leases,
    are charged to expense as incurred.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Net changes in capitalized exploratory well costs are reflected
    in the following table for the periods presented:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="79%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Beginning of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    324
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploratory well cost additions (pending determination of proved
    reserves)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    72,972
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,666
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploratory well cost reclassifications (successful
    determination of proved reserves)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (72,869
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (37,633
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploratory well dry hole costs (unsuccessful in adding proved
    reserves)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (709
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    End of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    427
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    324
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the period ended December&#160;31, 2007, the Company&#146;s
    drilling activity was conducted on proved undeveloped leasehold
    locations, and as such, there were no exploratory wells drilled
    in 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, the Company had no exploratory
    well costs that were capitalized for a period greater than one
    year.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Deferred
    Costs</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company capitalizes costs incurred in connection with
    obtaining financing. These costs are included in Deferred Costs
    and Other Assets on the Company&#146;s Consolidated Balance
    Sheet and are amortized over the term of the related financing
    using the straight-line method, which approximates the effective
    interest method.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Asset
    Retirement Obligations</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In accordance with the Financial Accounting Standard
    Board&#146;s, or FASB&#146;s, authoritative guidance on asset
    retirement obligations, or ARO, the Company records the fair
    value of a liability for a legal obligation to retire an asset
    in the period in which the liability is incurred with the
    corresponding cost capitalized by increasing the carrying amount
    of the related long-lived asset. For oil and gas properties,
    this is the period in which the well is drilled or acquired. The
    ARO represents the estimated amount the Company will incur to
    plug, abandon and remediate the properties at the end of their
    productive lives, in accordance with applicable state laws. The
    liability is accreted to its present value each period and the
    capitalized costs are depreciated using the
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    method. The accretion expense is recorded as a component of
    Depreciation, Depletion and Amortization in the Company&#146;s
    Consolidated Statement of Operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company determines the ARO by calculating the present value
    of estimated cash flows related to the liability. Estimating the
    future ARO requires management to make estimates and judgments
    regarding timing, and existence of a liability, as well as what
    constitutes adequate restoration. Inherent in the fair value
    calculation are numerous assumptions and judgments including the
    ultimate costs, inflation factors, credit adjusted discount
    rates, timing of settlement and changes in the legal,
    regulatory, environmental and political environments. These
    assumptions represent Level 3 inputs, as further discussed in
    Note&#160;4&#160;&#151; Fair Value Measurements. To the extent
    future revisions to these assumptions impact the fair value of
    the existing ARO liability, a corresponding adjustment is made
    to the related asset.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-11
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Revenue
    Recognition</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Revenue from the Company&#146;s interests in producing wells is
    recognized when the product is delivered, at which time the
    customer has taken title and assumed the risks and rewards of
    ownership, and collectability is reasonably assured.
    Substantially all of the Company&#146;s production is sold to
    purchasers under short-term (less than 12&#160;months) contracts
    at market based prices. The sales prices for oil and natural gas
    are adjusted for transportation and quality differentials. These
    differentials are based on contractual or historical data and do
    not require significant judgment. Subsequently, these revenue
    differentials are adjusted to reflect actual charges based on
    third-party documents. Since there is a ready market for oil and
    natural gas, the Company sells the majority of its production
    soon after it is produced at various locations. As a result, the
    Company maintains a minimum amount of product inventory in
    storage.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Production
    Taxes and Royalties Payable</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company calculates and pays taxes and royalties on oil and
    natural gas in accordance with the particular contractual
    provisions of the lease, license or concession agreements and
    the laws and regulations applicable to those agreements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Concentrations
    of Market Risk</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The future results of the Company&#146;s oil and natural gas
    operations will be affected by the market prices of oil and
    natural gas. The availability of a ready market for oil and
    natural gas products in the future will depend on numerous
    factors beyond the control of the Company, including weather,
    imports, marketing of competitive fuels, proximity and capacity
    of oil and natural gas pipelines and other transportation
    facilities, any oversupply or undersupply of oil, natural gas
    and liquid products, the regulatory environment, the economic
    environment, and other regional and political events, none of
    which can be predicted with certainty.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company operates in the exploration, development and
    production sector of the oil and gas industry. The
    Company&#146;s receivables include amounts due from purchasers
    of its oil and natural gas production and amounts due from joint
    venture partners for their respective portions of operating
    expense and exploration and development costs. While certain of
    these customers and joint venture partners are affected by
    periodic downturns in the economy in general or in their
    specific segment of the oil or natural gas industry, the Company
    believes that its level of credit-related losses due to such
    economic fluctuations has been and will continue to be
    immaterial to the Company&#146;s results of operations over the
    long-term.&#160;&#160;Trade receivables are generally not
    collateralized.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Concentrations
    of Credit Risk</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company manages and controls market and counterparty credit
    risk. In the normal course of business, collateral is not
    required for financial instruments with credit risk. Financial
    instruments which potentially subject the Company to credit risk
    consist principally of temporary cash balances and derivative
    financial instruments. The Company maintains cash and cash
    equivalents in bank deposit accounts which, at times, may exceed
    the federally insured limits. The Company has not experienced
    any significant losses from such investments. The Company
    attempts to limit the amount of credit exposure to any one
    financial institution or company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, the Company&#146;s customer base
    consists primarily of a major oil refining company, an oil and
    gas marketing firm, a large natural gas processing company and
    smaller oil and gas producers. The Company believes the credit
    quality of its customers is generally high. In the normal course
    of business, letters of credit or parent guarantees are required
    for counterparties which management perceives to have a higher
    credit risk.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-12
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Risk
    Management</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company utilizes derivative financial instruments (primarily
    swaps and zero-cost collars) to manage risks related to changes
    in oil prices. As of December&#160;31, 2009, the Company
    utilized fixed-price swap agreements and zero-cost collar
    options to reduce the volatility of oil prices on a significant
    portion of the Company&#146;s future expected oil production.
    See Note&#160;5&#160;&#151; Derivative Instruments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company records all derivative instruments on the balance
    sheet as either assets or liabilities measured at their
    estimated fair value. The Company has not designated any
    derivative instruments as hedges for accounting purposes and
    does not enter into such instruments for speculative trading
    purposes. Realized gains and losses from the settlement of
    commodity derivative instruments and unrealized gains and losses
    from valuation changes in the remaining unsettled commodity
    derivative instruments are reported in the Other Income
    (Expense) section of the Company&#146;s Consolidated Statement
    of Operations. Unrealized gains are included in current and
    noncurrent assets and unrealized losses are included in current
    and noncurrent liabilities on the Consolidated Balance Sheet,
    respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Derivative financial instruments that hedge the price of oil are
    generally executed with major financial or commodities trading
    institutions that expose the Company to market and credit risks
    and which may, at times, be concentrated with certain
    counterparties or groups of counterparties. The Company has
    derivatives in place with two counterparties, one of which is a
    lender under the Company&#146;s revolving credit facility.
    Although notional amounts are used to express the volume of
    these contracts, the amounts potentially subject to credit risk
    in the event of nonperformance by the counterparties are
    substantially smaller. The credit worthiness of the
    counterparties is subject to continual review. The Company
    believes the risk of nonperformance by its counterparties is
    low. Full performance is anticipated, and the Company has no
    past-due receivables from its counterparties. The Company&#146;s
    policy is to execute financial derivatives only with major,
    credit-worthy financial institutions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s derivative contracts are documented with
    industry standard contracts known as a Schedule to the Master
    Agreement and International Swaps and Derivative Association,
    Inc. Master Agreement (&#147;ISDA&#148;). Typical terms for the
    ISDAs include credit support requirements, cross default
    provisions, termination events and set-off provisions. The
    Company is not required to provide any credit support to its
    counterparties other than cross collateralization with the
    properties securing the Company&#146;s revolving credit
    facility. See Note&#160;7&#160;&#151; Long-Term Debt. As of
    December&#160;31, 2009, the revolving credit facility limited
    the total amount of current year production that may be hedged
    by the Company to 80% of projected production from proved
    developed producing reserves. As of December&#160;31, 2009, the
    contractual commodity derivative volumes for 2010 and 2011
    represent approximately 62% and 32%, respectively, of volumes
    from proved developed producing reserves, based on the
    Company&#146;s reserve estimates at December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Environmental
    Costs</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Environmental expenditures are expensed or capitalized, as
    appropriate, depending on their future economic benefit.
    Expenditures that relate to an existing condition caused by past
    operations, and which do not have future economic benefit, are
    expensed. Liabilities related to future costs are recorded on an
    undiscounted basis when environmental assessments
    <FONT style="white-space: nowrap">and/or</FONT>
    remediation activities are probable and the costs can be
    reasonably estimated.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Income
    Taxes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Because the Company is electing to be treated as a partnership
    for tax purposes, the income or loss of the Company for federal
    and state income tax purposes is allocated to its members in
    accordance with the Oasis Agreement, as amended. Members are
    responsible for reporting their share of taxable income or loss
    on their
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-13
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    separate income tax returns. Accordingly, no recognition has
    been given to federal or state income taxes in the accompanying
    consolidated financial statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company incurred a net loss for both book and income tax
    purposes for the years ended December&#160;31, 2009 and 2008 and
    the period ended December&#160;31, 2007. As a result, each
    investor member was allocated net tax losses and the Company was
    not obligated to make cash tax distribution payments to its
    members.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Member
    Contributions and Distributions</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Oasis Agreement, as amended, defines the maximum amount of
    capital contribution commitment and the associated capital
    contribution percentage for each member. The Company&#146;s
    Board of Managers determines whether capital contributions shall
    be made to the Company during the Commitment Period. Members are
    required to transfer funds for capital contributions, according
    to their respective percentages, upon receipt of a written
    notice from the Board of Managers. Capital contributions were
    $104.6&#160;million, $80.5&#160;million and $49.9&#160;million
    for the years ended December&#160;31, 2009 and 2008 and the
    period ended December&#160;31, 2007, respectively. In connection
    with each of its capital contributions, EnCap receives a
    placement fee in an amount equal to 2% of its capital
    contributions. Such placement fees are remitted by the Company
    to EnCap or its designee. Placement fees were $1.6&#160;million,
    $1.2&#160;million and $1.0&#160;million for contributions made
    in 2009 and 2008 and the period ended December&#160;31, 2007,
    respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Oasis Agreement, as amended, also defines the allocation of
    costs and revenues, which is proportionate to the members&#146;
    respective ownership percentage, as well as income tax
    allocations for each of the members&#146; accounts. The Company
    is responsible for providing income tax information related to
    each members&#146; account in order for such member to meet
    applicable state and federal tax reporting and filing
    requirements. Within 90&#160;days after the end of each taxable
    year in which there is taxable income and sufficient working
    capital, as determined by the Board of Managers, the Company is
    obligated to make tax distributions to each member equal to tax
    obligations arising from the application of combined federal and
    applicable state and local income tax rates to such
    member&#146;s share of taxable income for that tax year. Tax
    distributions are treated as capital advances and the cumulative
    amount of such advances will be deducted from future
    distribution events that are not tax distributions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Distribution events, such as the sale or disposition of assets,
    are made according to the distribution percentages specified in
    the Oasis Agreement, as amended. There were no such
    distributions made in 2009 or 2008.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Fair
    Value of Financial and Non-Financial Instruments</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The carrying value of cash and cash equivalents, accounts
    receivable, accounts payable and other payables approximate
    their respective fair market values due to their short
    maturities. The Company&#146;s derivative instruments, long-term
    debt and asset retirement obligations are also recorded on the
    balance sheet at amounts which approximate fair market value.
    See Note 4&#160;&#151; Fair Value Measurements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Recent
    Accounting Pronouncements</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>FASB Codification</I>&#160;&#151; In June 2009, the FASB
    issued authoritative guidance on the hierarchy of generally
    accepted accounting principles (&#147;GAAP&#148;), which
    established only two levels of GAAP, authoritative and
    non-authoritative. The FASB Accounting Standards Codification
    (the &#147;Codification&#148;) became the single source of
    authoritative, nongovernmental GAAP, except for rules and
    interpretive releases of the SEC, which are sources of
    authoritative GAAP for SEC registrants. All other
    non-grandfathered, non-SEC accounting literature not included in
    the Codification became non-authoritative. The Codification is
    effective for financial statements issued for interim or annual
    reporting periods ending after September&#160;15, 2009. As the
    Codification was not
</DIV>
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    <BR>
    F-14
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    intended to change or alter existing GAAP, it did not have any
    impact on the Company&#146;s consolidated financial position,
    cash flows or results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Subsequent Events</I>&#160;&#151; In May 2009, the FASB
    issued authoritative guidance on subsequent events in order to
    establish general standards of accounting for and disclosures of
    events that occur after the balance sheet date but before
    financial statements are issued or are available to be issued.
    Particular importance has been placed on the period after the
    balance sheet date during which management should evaluate
    events or transactions that may occur, leading to recognition
    within the financial statements or disclosure in the financial
    statements. This guidance is effective for financial statements
    issued for interim or annual reporting periods ending after
    June&#160;15, 2009. The adoption did not have a significant
    impact on the Company&#146;s consolidated financial position,
    cash flows or results of operations. See
    Note&#160;11&#160;&#151; Subsequent Events.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Fair Value Measurements</I>&#160;&#151; In September 2006,
    the FASB issued authoritative guidance on fair value
    measurements. This guidance defines fair value, establishes a
    framework for measuring fair value and expands disclosure
    requirements regarding fair value measurement. This guidance was
    effective for all recurring measures of financial assets and
    financial liabilities for fiscal years beginning after
    November&#160;15, 2007, and was adopted by the Company on
    January&#160;1, 2008. In February 2008, the FASB amended the
    authoritative guidance to delay the effective date of fair value
    accounting for nonfinancial assets and liabilities that are
    recognized or disclosed at fair value on a nonrecurring basis
    until fiscal years beginning after November&#160;15, 2008.
    Beginning January&#160;1, 2009, the Company implemented the
    guidance for nonfinancial assets and liabilities. The adoption
    of this guidance did not have an impact on the Company&#146;s
    consolidated financial position, results of operations or cash
    flows.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In April 2009, the FASB amended existing authoritative guidance
    to provide additional application guidance and enhance
    disclosures regarding fair value measurements. This guidance
    intends to provide guidelines for making fair value measurements
    more consistent with other authoritative guidance and enhance
    consistency in financial reporting by increasing the frequency
    of fair value disclosures. This guidance is effective for
    interim and annual reporting periods ending after June&#160;15,
    2009, with early adoption permitted for periods ending after
    March&#160;15, 2009. The adoption of this guidance did not have
    a significant impact on the Company&#146;s financial position,
    cash flows or results of operations. See Note&#160;4&#160;&#151;
    Fair Value Measurements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In February 2010, the FASB enhanced existing authoritative
    guidance on certain disclosure requirements and added two new
    disclosure requirements related to fair value measurements. The
    guidance requires a gross presentation of activities within the
    Level&#160;3 roll forward and adds a new requirement to disclose
    details of significant transfers in and out of Level&#160;1 and
    2 measurements and the reasons for the transfers. The new
    disclosures are required for all companies required to provide
    disclosures about recurring and nonrecurring fair value
    measurements, and are effective for the first interim or annual
    reporting period beginning after December&#160;15, 2009, except
    for the gross presentation of the Level&#160;3 roll forward
    information, which is required for annual reporting periods
    beginning after December&#160;15, 2010 and for reporting periods
    within those years. The Company does not expect the adoption of
    this new guidance to have a significant impact on its financial
    position, cash flows or results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Oil and Gas Reporting Requirements</I>&#160;&#151; In
    December 2008, the Securities and Exchange Commission
    (&#147;SEC&#148;) released its final rule, &#147;Modernization
    of Oil and Gas Reporting&#148;, which adopts revisions to the
    SEC&#146;s oil and gas reporting disclosure requirements. The
    disclosure requirements under this final rule require reporting
    of oil and gas reserves using the unweighted arithmetic average
    of the
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    price for the preceding twelve months rather than year-end
    prices, and the use of new technologies to determine proved
    reserves if those technologies have been demonstrated to result
    in reliable conclusions about reserves volumes. Companies are
    allowed, but not required, to disclose probable and possible
    reserves in SEC filings. In addition, companies are required to
    report the independence and qualifications of their reserves
    preparer or auditor and file reports when a third party is
    relied upon to prepare reserves estimates or conduct a reserves
    audit. In January 2010, the FASB issued authoritative guidance
    on oil and gas reserve estimation and
</DIV>
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    <BR>
    F-15
</DIV><!-- END PAGE WIDTH -->
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    disclosure, aligning their requirements with the SEC&#146;s
    final rule. The Company has presented and applied this new
    guidance for the year ended December&#160;31, 2009 herein. See
    Note&#160;13&#160;&#151; Supplemental Oil and Gas Reserve
    Information&#160;&#151; Unaudited.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Disclosures about Derivative Instruments and Hedging
    Activities&#160;&#151; </I>In March 2008, the FASB issued
    authoritative guidance related to disclosures about derivative
    instruments and hedging activities. Disclosures previously
    required only for the annual financial statements are now
    required in interim financial statements. This guidance is
    intended to improve financial reporting about derivative
    instruments and hedging activities by requiring companies to
    enhance disclosure about how these instruments and activities
    affect their financial position, performance and cash flows and
    to improve the transparency of the location and amounts of
    derivative instruments in a company&#146;s financial statements
    and how they are accounted for. This guidance was effective for
    the Company beginning January&#160;1, 2009. The adoption of this
    guidance did not have a significant impact on the Company&#146;s
    consolidated financial position, results of operations or cash
    flows. See Note&#160;5&#160;&#151; Derivative Instruments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Business Combinations</I>&#160;&#151; In December 2007, the
    FASB revised the authoritative guidance for business
    combinations, extending its applicability to all transactions
    and other events in which one entity obtains control over one or
    more other businesses. The revised guidance broadens the fair
    value measurement and recognition of assets acquired,
    liabilities assumed and interests transferred as a result of
    business combinations and requires that acquisition-related
    costs incurred prior to the acquisition be expensed. The revised
    guidance also expands the definition of what qualifies as a
    business, and this expanded definition could include prospective
    oil and gas purchases. Additionally, this guidance expands the
    required disclosures to improve the financial statement
    users&#146; abilities to evaluate the nature and financial
    effects of business combinations. The guidance is effective for
    business combinations for which the acquisition date is on or
    after January&#160;1, 2009. The Company has presented and
    applied this new guidance for all 2009 acquisitions that
    qualified as a business combination. See Note&#160;3&#160;&#151;
    Acquisitions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Non-Controlling Interests in Consolidated Financial
    Statements&#160;&#151; </I>In December 2007, the FASB issued
    authoritative guidance which improves the relevance,
    comparability and transparency of the financial information that
    a reporting entity provides in its consolidated financial
    statements by establishing accounting and reporting standards
    for the non-controlling interest in a subsidiary and for the
    deconsolidation of a subsidiary. This guidance is effective for
    fiscal years beginning after December&#160;15, 2008. The
    adoption of this guidance did not have a significant impact on
    the Company&#146;s consolidated financial position, results of
    operations or cash flows.
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">3.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Acquisitions</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Kerogen Acquisition</I>&#160;&#151; On June&#160;15, 2009,
    the Company acquired interests in certain oil and gas properties
    primarily in the East Nesson area of the Williston Basin from
    Kerogen Resources, Inc. (the &#147;Kerogen Acquisition
    Properties&#148;) for $27.1&#160;million (subject to closing
    adjustments). In addition to acquiring the interests in the East
    Nesson project area, the Company also acquired non-operated
    interests in the Sanish project area.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The acquisition qualifies as a business combination, and as
    such, the Company estimated the fair value of these properties
    as of the June&#160;15, 2009 acquisition date. The fair value is
    the price that would be received to sell an asset or paid to
    transfer a liability in an orderly transaction between market
    participants at the measurement date (exit price). Fair value
    measurements also utilize assumptions of market participants.
    The Company used a discounted cash flow model and made market
    assumptions as to future commodity prices, projections of
    estimated quantities of oil and natural gas reserves,
    expectations for timing and amount of future development and
    operating costs, projections of future rates of production,
    expected recovery rates and risk adjusted discount rates. These
    assumptions represent Level&#160;3 inputs, as further discussed
    under Note&#160;4&#160;&#151; Fair Value Measurements.
</DIV>
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    <BR>
    F-16
</DIV><!-- END PAGE WIDTH -->
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company estimates the fair value of the Kerogen Acquisition
    Properties to be approximately $27.1&#160;million, which the
    Company considers to be representative of the price paid by a
    typical market participant. This measurement resulted in no
    goodwill or bargain purchase being recognized. The acquisition
    related costs were insignificant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes the consideration paid for the
    Kerogen Acquisition Properties and the fair value of the assets
    acquired and liabilities assumed as of June&#160;15, 2009. The
    purchase price allocation is preliminary and subject to
    adjustment, as the final closing statement will be complete
    during first quarter of 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="91%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Consideration given to Kerogen Resources, Inc. (in thousands):
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cash
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    27,087
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Recognized amounts of identifiable assets acquired and
    liabilities assumed:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved developed properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    25,178
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved undeveloped properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,647
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Unproved lease acquisition costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    360
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Seismic costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    667
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Asset retirement obligations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (765
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total identifiable net assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    27,087
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Summarized below are the consolidated results of operations for
    the years ended December&#160;31, 2009 and 2008, on an unaudited
    pro forma basis, as if the acquisition had occurred on January 1
    of each of the periods presented. The unaudited pro forma
    financial information was derived from the historical
    consolidated statements of operations of the Company and the
    statements of revenues and direct operating expenses for the
    Kerogen Acquisition Properties, which were derived from the
    historical accounting records of the seller. The unaudited pro
    forma financial information does not purport to be indicative of
    results of operations that would have occurred had the
    transaction occurred on the basis assumed above, nor is such
    information indicative of the Company&#146;s expected future
    results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="61%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Actual</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Pro Forma</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Actual</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Pro Forma</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom">
    <B>Unaudited</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <I>Kerogen Acquisition Properties:</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,755
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    41,999
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,736
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    51,314
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net Loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,461
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (34,391
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (25,858
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Fidelity Acquisition</I>&#160;&#151; On September&#160;30,
    2009, the Company acquired additional interests in the East
    Nesson project area of the Williston Basin from Fidelity
    Exploration and Production Company (the &#147;Fidelity
    Acquisition Properties&#148;) for $10.7&#160;million (subject to
    closing adjustments).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The acquisition qualifies as a business combination, and as
    such, the Company estimated the fair value of these properties
    as of the September&#160;30, 2009 acquisition date. The Company
    used a discounted cash flow model and made market assumptions as
    to future commodity prices, projections of estimated quantities
    of oil and natural gas reserves, expectations for timing and
    amount of future development and operating costs, projections of
    future rates of production, expected recovery rates and risk
    adjusted discount rates. These assumptions represent
    Level&#160;3 inputs, as further discussed under
    Note&#160;4&#160;&#151; Fair Value Measurements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company estimates the fair value of the Fidelity Acquisition
    Properties to be approximately $10.7&#160;million, which the
    Company considers to be representative of the price paid by a
    typical market
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-17
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    participant. This measurement resulted in no goodwill or bargain
    purchase being recognized. The acquisition related costs were
    insignificant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes the consideration paid for the
    Fidelity Acquisition Properties and the fair value of the assets
    acquired and liabilities assumed as of September&#160;30, 2009.
    The purchase price allocation is preliminary and subject to
    adjustment, as the final closing statement will be complete
    during first quarter of 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="91%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Consideration given to Fidelity Exploration and Production
    Company (in thousands):
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cash
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,681
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Recognized amounts of identifiable assets acquired and
    liabilities assumed:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved developed properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,668
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved undeveloped properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,415
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Unproved lease acquisition costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,450
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Seismic costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    667
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Asset retirement obligations
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (519
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total identifiable net assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,681
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Summarized below are the consolidated results of operations for
    the years ended December&#160;31, 2009 and 2008, on an unaudited
    pro forma basis as if the acquisition had occurred on January 1
    of each of the periods presented. The pro forma financial
    information was derived from the historical consolidated
    statements of operations of the Company and the statements of
    revenues and direct operating expenses for the Fidelity
    Acquisition Properties, which were derived from the historical
    accounting records of the seller. The unaudited pro forma
    financial information does not purport to be indicative of
    results of operations that would have occurred had the
    transaction occurred on the basis assumed above, nor is such
    information indicative of the Company&#146;s expected future
    results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="61%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Actual</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Pro Forma</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Actual</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Pro Forma</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom">
    <B>Unaudited</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <I>Fidelity Acquisition Properties:</I>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,755
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    40,934
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,736
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    38,438
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net Loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,872
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (34,391
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (33,065
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">4.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Fair
    Value Measurements</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company adopted the FASB&#146;s authoritative guidance on
    fair value measurements effective January&#160;1, 2008 for
    financial assets and liabilities measured on a recurring basis.
    Beginning January&#160;1, 2009, the Company also applied this
    guidance to non-financial assets and liabilities. The
    Company&#146;s financial assets and liabilities are measured at
    fair value on a recurring basis. The Company discloses its
    recognized non-financial assets and liabilities, such as asset
    retirement obligations and other property and equipment, at fair
    value on a non-recurring basis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As defined in the authoritative guidance, fair value is the
    price that would be received to sell an asset or paid to
    transfer a liability in an orderly transaction between market
    participants at the measurement date (&#147;exit price&#148;).
    To estimate fair value, the Company utilizes market data or
    assumptions that market participants would use in pricing the
    asset or liability, including assumptions about risk and the
    risks inherent in the inputs to the valuation technique. These
    inputs can be readily observable, market corroborated or
    generally unobservable.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-18
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The authoritative guidance establishes a fair value hierarchy
    that prioritizes the inputs used to measure fair value. The
    hierarchy gives the highest priority to unadjusted quoted prices
    in active markets for identical assets or liabilities
    (&#147;Level&#160;1&#148; measurements) and the lowest priority
    to unobservable inputs (&#147;Level&#160;3&#148; measurements).
    The three levels of the fair value hierarchy are as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Level&#160;1</I>&#160;&#151; Quoted prices are available in
    active markets for identical assets or liabilities as of the
    reporting date. Active markets are those in which transactions
    for the asset or liability occur in sufficient frequency and
    volume to provide pricing information on an ongoing basis.
    Level&#160;1 primarily consists of financial instruments such as
    exchange-traded derivatives, listed equities and
    U.S.&#160;government treasury securities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Level&#160;2</I>&#160;&#151; Pricing inputs are other than
    quoted prices in active markets included in Level&#160;1, which
    are either directly or indirectly observable as of the reporting
    date. Level&#160;2 includes those financial instruments that are
    valued using models or other valuation methodologies. These
    models are primarily industry-standard models that consider
    various assumptions, including quoted forward prices for
    commodities, time value, volatility factors and current market
    and contractual prices for the underlying instruments, as well
    as other relevant economic measures. Substantially all of these
    assumptions are observable in the marketplace throughout the
    full term of the instrument, can be derived from observable data
    or are supported by observable levels at which transactions are
    executed in the marketplace. Instruments in this category
    include non-exchange-traded derivatives, such as
    <FONT style="white-space: nowrap">over-the-counter</FONT>
    forwards and options.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Level&#160;3</I>&#160;&#151; Pricing inputs include
    significant inputs that are generally less observable from
    objective sources. These inputs may be used with internally
    developed methodologies that result in management&#146;s best
    estimate of fair value.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As required, financial assets and liabilities are classified in
    their entirety based on the lowest level of input that is
    significant to the fair value measurement. The Company&#146;s
    assessment of the significance of a particular input to the fair
    value measurement requires judgment and may affect the valuation
    of fair value assets and liabilities and their placement within
    the fair value hierarchy levels. The following table sets forth
    by level within the fair value hierarchy the Company&#146;s
    financial assets and liabilities that were accounted for at fair
    value on a recurring basis as of December&#160;31, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="69%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>At fair value as of December&#160;31, 2009</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Level 1</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Level 2</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Level 3</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Assets (Liabilities):
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Commodity Derivative Instruments (see Note&#160;5)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,953
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,953
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total Derivative Instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,953
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,953
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Level&#160;3 instruments presented in the table above
    consist of oil swaps and collars. The Company utilizes the
    <FONT style="white-space: nowrap">mark-to-market</FONT>
    valuation reports provided by its counterparties for monthly
    settlement purposes to determine the valuation of its derivative
    instruments. The determination of the fair values presented
    above also incorporates a credit adjustment for non-performance
    risk, as required by GAAP. The Company calculated the credit
    adjustment for derivatives in an asset position using current
    credit default swap values for each counterparty. The credit
    adjustment for derivatives in a liability position is based on
    the Company&#146;s current cost of prime based borrowings (prime
    rate and associated margin effect). Based on these calculations,
    the Company recorded a downward adjustment to the fair value of
    its derivative instruments in the amount of $0.08&#160;million
    at December&#160;31, 2009.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-19
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table presents a roll forward of the derivatives
    classified as Level&#160;3 in the fair value hierarchy for the
    year ended December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="87%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Derivatives<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Instruments</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Balance as of January&#160;1, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,090
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total gains or (losses) (realized or unrealized):
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Included in earnings
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,747
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Included in other comprehensive income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Purchases, issuances and settlements
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,296
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Transfers in and out of level&#160;3
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Balance as of December&#160;31, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,953
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Change in unrealized gains (losses) included in earnings
    relating to derivatives still held at December&#160;31, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At December&#160;31, 2009, the Company&#146;s financial
    instruments, including cash and cash equivalents, accounts
    receivable and accounts payable, are carried at cost, which
    approximates fair value due to the short-term maturity of these
    instruments. The carrying amount of long-term debt reported in
    the Consolidated Balance Sheet at December&#160;31, 2009 is
    $35.0&#160;million, which approximates fair value due to the
    short term maturity of the debt obligations (see
    Note&#160;7&#160;&#151; Long-Term Debt). The carrying amount of
    the Company&#146;s ARO in the Consolidated Balance Sheet at
    December&#160;31, 2009 is $6.5&#160;million, which also
    approximates fair value as the Company determines the ARO by
    calculating the present value of estimated cash flows related to
    the liability based on the calculation of the estimated value
    (see Note&#160;2&#160;&#151; Summary of Significant Accounting
    Policies).
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">5.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Derivative
    Instruments</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company utilizes derivative financial instruments to manage
    risks related to changes in oil prices. As of December&#160;31,
    2009, the Company utilized fixed-price swap agreements and
    zero-cost collar options to reduce the volatility of oil prices
    on a significant portion of the Company&#146;s future expected
    oil production.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All derivative instruments are recorded on the balance sheet as
    either assets or liabilities measured at their estimated fair
    value (see Note&#160;4&#160;&#151; Fair Value Measurements). The
    Company has not designated any derivative instruments as hedges
    for accounting purposes and does not enter into such instruments
    for speculative trading purposes. If a derivative does not
    qualify as a hedge or is not designated as a hedge, the changes
    in the fair value, both realized and unrealized, are recognized
    in the Other Income (Expense) section of the Consolidated
    Statement of Operations as a gain or loss on
    <FONT style="white-space: nowrap">mark-to-market</FONT>
    derivative contracts. The Company&#146;s cash flow is only
    impacted when the actual settlements under the derivative
    contracts result in making or receiving a payment to or from the
    counterparty. These cash settlements are reflected as investing
    activities in the Company&#146;s Consolidated Statement of Cash
    Flows.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-20
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, the Company had the following
    outstanding commodity derivative contracts, all of which settle
    monthly, and none of which were designated as hedges:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="25%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Total Notional<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>Settlement<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Derivative<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Amount of Oil<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Floor<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Ceiling<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Fair Market<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Period</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Instrument</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(Barrels)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Prices</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Prices</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fixed Price</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Value</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2010
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    NYMEX Swap
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,163
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    72.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (26
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2010
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    NYMEX Collar
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    401,814
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    67.48
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    90.19
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (841
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2011
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    NYMEX Collar
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    186,764
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    61.49
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    82.23
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2012
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    NYMEX Collar
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,618
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    60.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    80.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (174
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,953
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes the location and fair value of
    all outstanding commodity derivative contracts recorded in the
    balance sheet that do not qualify for hedge accounting for the
    periods presented:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="29%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="52%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="10" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fair Value of Derivative Instrument Assets (Liabilities)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Estimated Fair Value<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Instrument Type</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Balance Sheet Location</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Crude oil swap
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Derivative Instruments&#160;&#151; current assets
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,551
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Crude oil collar
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Derivative Instruments&#160;&#151; current assets
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    219
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    733
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Crude oil swap
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Derivative Instruments&#160;&#151; non-current asset
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    136
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Crude oil collar
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Derivative Instruments&#160;&#151; non-current asset
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    670
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Crude oil swap
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Derivative Instruments&#160;&#151; current liabilities
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (26
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Crude oil collar
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Derivative Instruments&#160;&#151; current liabilities
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,061
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Crude oil collar
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Derivative Instruments&#160;&#151; non-current liabilities
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,085
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Total Derivative Instruments
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (2,953
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,090
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes the location and amounts of
    realized and unrealized gains and losses from the Company&#146;s
    commodity derivative contracts that do not qualify for hedge
    accounting for the periods presented:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="28%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="51%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Income Statement Location</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Derivative Contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Change in Unrealized Gain (Loss) on Derivative Instruments
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    14,769
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Derivative Contracts
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Realized Gain (Loss) on Derivative Instruments
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,932
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Total Commodity Derivative Gain (Loss)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (4,747
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,837
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-21
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">6.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Accrued
    Liabilities</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s accrued liabilities consist of the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="81%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accrued capital costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    14,754
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,620
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accrued lease operating expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,560
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    631
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accrued general and administrative expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,056
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    599
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    668
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    866
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    18,038
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,716
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, the Company had production taxes payable of
    $1.2&#160;million and $0.1&#160;million for the years ended
    December&#160;31, 2009 and 2008, respectively, included in
    Production Taxes and Royalties Payable on the Consolidated
    Balance Sheet.
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">7.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Long-Term
    Debt</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company, as parent, and OPNA, as borrower, entered into a
    credit agreement dated June&#160;22, 2007, which was
    subsequently amended on June&#160;10, 2008, May&#160;13, 2009
    and June&#160;23, 2009 (as amended, the &#147;Credit
    Facility&#148;). Under the Credit Facility, BNP Paribas, as
    administrative agent, and JPMorgan Chase Bank, as syndication
    agent, (collectively the &#147;Lenders&#148;) provide the
    Company with a senior secured revolving line of credit that is
    collateralized by all of the Company&#146;s oil and natural gas
    properties. Borrowings under the Credit Facility are
    collateralized by perfected first priority liens and security
    interests on substantially all of the Company&#146;s assets,
    including mortgage liens on oil and natural gas properties
    having at least 80% of the reserve value as determined by
    reserve reports.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Credit Facility provides for periodic scheduled
    redeterminations of the collateral value of the Company&#146;s
    oil and natural gas properties to determine the allowable
    borrowing base. Upon completing its review of the Company&#146;s
    interim oil and gas reserves report as of September&#160;1,
    2009, the Lenders provided a letter notification that a
    $45&#160;million maximum borrowing base would become effective
    upon payment of the associated banking fees, which were paid on
    October&#160;19, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Borrowings under the Credit Facility are subject to varying
    rates of interest based on (1)&#160;the total outstanding
    borrowings (including the value of all outstanding letters of
    credit) in relation to the borrowing base and (2)&#160;whether
    the loan is a London Interbank Offered Rate (&#147;LIBOR&#148;)
    loan or a bank prime interest rate loan (defined in the Credit
    Facility as an Alternate Based Rate or &#147;ABR&#148; loan).
    The LIBOR and ABR loans bear their respective interest rates
    plus the applicable margin indicated in the following table:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="65%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Applicable Margin<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Applicable Margin<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Ratio of Total Outstanding Borrowings to Borrowing Base</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>for LIBOR Loans</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>for ABR Loans</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Less than .50 to 1
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.25
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.75
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Greater than or equal to .50 to 1 but less than .75 to 1
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.50
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.00
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Greater than or equal to .75 to 1 but less than .85 to 1
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.75
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.25
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Greater than .85 to 1 but less than or equal 1
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.00
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.50
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    An ABR loan does not have a set maturity date and may be repaid
    at any time upon the Company providing advance notification to
    the Lenders. Interest is paid quarterly for ABR loans based on
    the number of days an ABR loan is outstanding as of the last
    business day in March, June, September and December. The Company
    has the option to convert an ABR loan to a LIBOR-based loan upon
    providing advance notification to the Lenders. The minimum
    available loan term is one month and the maximum loan term is
    six months for
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-22
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    LIBOR-based loans. Interest for LIBOR loans is paid upon
    maturity of the loan term. Interim interest is paid every three
    months for LIBOR loans that have loan terms greater than three
    months in duration. At the end of a LIBOR loan term, the Credit
    Facility allows the Company to elect to continue a LIBOR loan
    with the same or a differing loan term or convert the borrowing
    to an ABR loan. Because the Credit Facility has a final maturity
    date of June&#160;22, 2011, outstanding borrowings are
    classified as long-term debt in the Company&#146;s Consolidated
    Balance Sheet at December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On a quarterly basis, the Company also pays a 0.50% commitment
    fee on the daily amount of borrowing base capacity not utilized
    during the quarter and fees calculated on the daily amount of
    letter of credit balances outstanding during the quarter.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For LIBOR loans, interest is payable at the maturity of the loan
    term. For ABR loans, interest is payable quarterly until such
    time the ABR loan balance is repaid or converted to a LIBOR loan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Credit Facility contains covenants that include, among
    others:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a prohibition against incurring debt, subject to permitted
    exceptions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a prohibition against making dividends, distributions and
    redemptions, subject to permitted exceptions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a prohibition against making investments, loans and advances,
    subject to permitted exceptions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    restrictions on creating liens and leases on the assets of the
    Company and its subsidiaries, subject to permitted exceptions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    restrictions on merging and selling assets outside the ordinary
    course of business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    restrictions on use of proceeds, investments, transactions with
    affiliates or change of principal business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a provision limiting oil and natural gas hedging transactions to
    a volume not exceeding 80&#160;percent (other than puts or
    floors not exceeding 100&#160;percent) of anticipated production
    from proved developed producing reserves;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a requirement that the Company not allow a ratio of Total Debt
    (as defined in the Credit Facility) to consolidated EBITDAX (as
    defined in the Credit Facility) to be greater than 4.5 to 1.0
    for any period to and including December&#160;31, 2009 and to be
    greater than 4.0 to 1.0 for any period thereafter;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a requirement that the Company maintain a Current Ratio of
    consolidated current assets (with exclusions as described in the
    Credit Facility) to consolidated current liabilities (with
    exclusions as described in the Credit Facility) of not less than
    1.0 to 1.0.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Credit Facility contains customary events of default. If an
    event of default occurs and is continuing, the Lenders may
    declare all amounts outstanding under the Credit Facility to be
    immediately due and payable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, borrowings under the Credit
    Facility totaled $35.0&#160;million and outstanding letters of
    credit issued under the Credit Facility totaled
    $0.2&#160;million, resulting in unused borrowing base capacity
    of $9.8&#160;million. The weighted average interest rate
    incurred on the outstanding Credit Facility borrowings during
    2009 was 3.5%.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-23
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">8.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Asset
    Retirement Obligations</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table reflects the changes in the Company&#146;s
    ARO during the years ended December&#160;31, 2009 and 2008:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Asset retirement obligation&#160;&#151; beginning of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,458
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,833
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Liabilities incurred through acquisitions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,285
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Liabilities incurred during period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    859
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    410
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Liabilities settled during period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (395
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (83
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accretion expense during period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    362
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    298
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revisions to estimates
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (58
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Asset retirement obligation&#160;&#151; end of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,511
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,458
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">9.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Significant
    Concentrations</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Purchasers that accounted for more than 10% of the
    Company&#146;s total sales for the periods presented are as
    follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="71%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Tesoro Refining and Marketing Company
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32%
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57%
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    79%
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Texon L.P.(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30%
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14%
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    N/A
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Not applicable for the period from February&#160;26, 2007
    (Inception) through December&#160;31, 2007 as the sales to Texon
    L.P. did not account for more than 10% of the Company&#146;s
    total sales.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    No other purchasers accounted for more than 10% of the
    Company&#146;s total oil and natural gas sales for the years
    ended December&#160;31, 2009 and 2008 and the period ended
    December&#160;31, 2007. Management believes that the loss of any
    of these purchasers would not have a material adverse effect on
    the Company&#146;s operations, as there are a number of
    alternative oil and natural gas purchasers in the Company&#146;s
    producing regions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Substantially all of the Company&#146;s accounts receivable
    result from sales of oil and natural gas as well as joint
    interest billings (&#147;JIB&#148;) to third-party companies who
    have working interest payment obligations in projects completed
    by the Company. Zenergy Operating, Bristol Exploration LP and
    Abraxas Petroleum Corporation accounted for approximately 27%,
    19% and 13%, respectively, of the Company&#146;s JIB receivables
    balance at December&#160;31, 2009. Hess Corporation and Windsor
    Bakken LLC accounted for approximately 41% and 13%,
    respectively, of the Company&#146;s JIB receivables balance at
    December&#160;31, 2008. No other individual account balances
    accounted for more than 10% of the Company&#146;s total JIB
    receivables at December&#160;31, 2009 and 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This concentration of customers and joint interest owners may
    impact the Company&#146;s overall credit risk, either positively
    or negatively, in that these entities may be similarly affected
    by changes in economic or other conditions.
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">10.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Commitments
    and Contingencies</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Lease Obligations</I>&#160;&#151; The Company has operating
    leases for office space. The Company incurred lease rental
    expenses of $332,104 and $278,149 for the years ended
    December&#160;31, 2009 and 2008, respectively, and
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-24
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    $119,100 for the period ended December&#160;31, 2007. Future
    minimum annual rental commitments under noncancelable leases as
    of and subsequent to December&#160;31, 2009 are as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="87%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2010
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    451
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2011
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    387
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2012
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    131
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2013
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Thereafter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    969
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Drilling Contracts</I>&#160;&#151; During 2008, the Company
    entered into drilling rig contracts with two drilling
    contractors. In the fourth quarter of 2008, the Company reduced
    its planned 2009 capital expenditure program and entered into
    discussions regarding early termination of these contracts. In
    the first quarter of 2009, the Company paid a total of
    $3.0&#160;million in rig termination fees in connection with the
    rig termination of the Company&#146;s remaining commitment under
    one drilling rig contract and the extension of the other
    drilling rig contract until June 2010. The Company agreed to
    retain an obligation to pay for 60 remaining shortfall days if
    the drilling rig was not used during the remaining term of the
    contract.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In November 2009, the Company entered into a new six-month term
    drilling rig contract, which replaced the contract the Company
    had previously extended. In the event of an early contract
    termination under this new drilling rig contract, the Company is
    obligated to pay a daily shortfall rate of $9,000 per day for
    the days remaining between the date of termination and
    May&#160;15, 2010, the end of the primary contract term.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Litigation</I>&#160;&#151; There are no claims, title matters
    or other legal proceedings arising in the ordinary course of
    business, including environmental contamination claims, personal
    injury and property damage claims, claims related to joint
    interest billings and other matters under oil and gas operating
    agreements and other contractual disputes that are pending or
    threatened against the Company at this time. The Company
    purchases and maintains general liability and other insurance to
    cover such potential liabilities.
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">11.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Subsequent
    Events</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company has evaluated the period after the balance sheet
    date up through March&#160;4, 2010, the date the consolidated
    financial statements were issued, noting no subsequent events or
    transactions that required recognition or disclosure in the
    financial statements, other than noted below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>New Drilling Rig Contract&#160;&#151; </I>On January&#160;27,
    2010, the Company entered into a new drilling rig contract. In
    the event of early contract termination under this new contract,
    the Company is obligated to pay a daily shortfall rate of $8,000
    per day for the days remaining between the date of termination
    and June&#160;15, 2010, the end of the primary contract term. On
    February&#160;22, 2010, the Company extended the term of this
    contract by one month to July&#160;15, 2010. All other rates,
    terms and conditions of the rig contract remained unchanged.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Amended and Restated Credit Facility&#160;&#151; </I>On
    February&#160;26, 2010, the Company entered into an agreement
    that amended and restated the existing Credit Facility (the
    &#147;Amended Credit Facility&#148;). The Amended Credit
    Facility increased the initial borrowing base to a maximum of
    $85&#160;million, defined a future borrowing base of
    $70&#160;million (the &#147;Conforming Borrowing Base&#148;) and
    extended the maturity date of the Amended Credit Facility to
    February&#160;26, 2014.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the Company does not consummate an initial public stock
    offering before October&#160;1, 2010, then the Borrowing Base
    shall equal the Conforming Borrowing Base on that date. The
    Conforming Borrowing Base is used as the denominator when
    calculating the utilization percentage of the Amended Credit
    Facility (the dollar amount of outstanding borrowings divided by
    the Conforming Borrowing Base).
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-25
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Borrowings under the Amended Credit Facility are subject to
    varying rates of interest based on (1)&#160;the total
    outstanding borrowings (including the value of all outstanding
    letters of credit) in relation to the borrowing base and
    (2)&#160;whether the loan is a LIBOR loan or a bank prime ABR
    loan. The LIBOR and ABR loans bear their respective interest
    rates plus the applicable margin as indicated in the following
    table:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="65%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Applicable Margin<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Applicable Margin<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Ratio of Total Outstanding Borrowings to Borrowing Base</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>for LIBOR Loans</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>for ABR Loans</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Less than .50 to 1
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.25
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.75
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Greater than or equal to .50 to 1 but less than .75 to 1
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Greater than or equal to .75 to 1 but less than .85 to 1
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.75
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Greater than .85 to 1 but less than or equal 1
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Greater than 1 but less than 1.125
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Greater than 1.125
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the time in which the Conforming Borrowing Base ceases to be
    in effect, the highest level for the Ratio of Total Outstanding
    Borrowings to Borrowing Base will be the &#147;Greater than .85
    to 1 but less than or equal to 1&#148; level in the above table.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Amended Credit Facility agreement retained the same
    quarterly fee payments for commitment and letter of credit fees
    and retained the same covenants as previously described for the
    Credit Facility (see Note&#160;7&#160;&#151; Long-Term Debt).
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">12.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Supplemental
    Oil and Gas Disclosures</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The supplemental data presented herein reflects information for
    all of the Company&#146;s oil and natural gas producing
    activities.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Capitalized
    Costs</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth the capitalized costs related to
    the Company&#146;s oil and natural gas producing activities at
    December&#160;31, 2009 and 2008:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="79%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    195,546
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    115,439
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Less: Accumulated depreciation, depletion, amortization and
    impairment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (62,330
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (46,188
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved properties, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    133,216
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69,251
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Unproved properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,804
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44,382
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total oil and gas properties, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    181,020
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    113,633
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the FASB&#146;s authoritative guidance on asset
    retirement obligations, net capitalized costs include asset
    retirement costs of $5.4&#160;million and $4.0&#160;million at
    December&#160;31, 2009 and 2008, respectively.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-26
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Costs
    Incurred in Oil and Natural Gas Property Acquisition,
    Exploration and Development Activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth costs incurred related to the
    Company&#146;s oil and natural gas activities for the years
    ended December&#160;31, 2009 and 2008 and for the period from
    February&#160;26, 2007 (inception) through December&#160;31,
    2007:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="62%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from <BR>
    February&#160;26, 2007 <BR>
    (Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Acquisition costs:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Proved properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    35,134
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    36,969
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,862
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Unproved properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,917
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69,680
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploration costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,222
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Development costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,526
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39,025
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,403
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Asset retirement costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,314
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,712
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total costs incurred
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    89,910
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    79,216
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    98,821
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Results
    of Operations for Oil and Natural Gas Producing
    Activities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Results of operations for oil and natural gas producing
    activities, which excludes straight-line depreciation, general
    and administrative expense and interest expense, are presented
    below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="61%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Period from<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>February&#160;26, 2007<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,755
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,736
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,791
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,501
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,074
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,157
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,592
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,581
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,153
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploration costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,222
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Rig termination
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Impairment of oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,117
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,177
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gain on sale of properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Results of operations for oil and gas producing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (135
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (34,258
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,140
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">13.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Supplemental
    Oil and Gas Reserve Information&#160;&#151; Unaudited</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The reserve estimates at December&#160;31, 2009 presented in the
    table below are based on a report prepared by DeGoyler and
    MacNaughton, independent reserve engineers, in accordance with
    the FASB&#146;s new authoritative guidance on oil and gas
    reserve estimation and disclosures. The reserve estimates at
    December&#160;31, 2008 and 2007 presented in the table below are
    based on reports prepared by W.D. Von Gonten&#160;&#038; Co.
    using the FASB rules in effect at that time. At
    December&#160;31, 2009, all of the Company&#146;s oil and
    natural gas producing activities were conducted within the
    continental United States.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-27
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company emphasizes that reserve estimates are inherently
    imprecise and that estimates of new discoveries and undeveloped
    locations are more imprecise than estimates of established
    proved producing oil and gas properties. Accordingly, these
    estimates are expected to change as future information becomes
    available.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Proved oil and natural gas reserves are the estimated quantities
    of oil and natural gas which geological and engineering data
    demonstrate, with reasonable certainty, to be recoverable in
    future years from known reservoirs under economic and operating
    conditions (i.e., prices and costs) existing at the time the
    estimate is made. Proved developed oil and natural gas reserves
    are proved reserves that can be expected to be recovered through
    existing wells and equipment in place and under operating
    methods being utilized at the time the estimates were made.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-28
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Estimated
    Quantities of Proved Oil and Natural Gas Reserves&#160;&#151;
    Unaudited</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth the Company&#146;s net proved,
    proved developed and proved undeveloped reserves at
    December&#160;31, 2009, 2008 and 2007:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="74%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Oil<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Gas<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MBbl)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MMcf)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>MBoe</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>2007 (a)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Proved reserves</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Beginning balance
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revisions of previous estimates
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (58
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    137
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (35
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Extensions, discoveries and other additions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    279
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    286
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Sales of reserves in place
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Purchases of reserves in place
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,982
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,133
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,171
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (159
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (73
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (171
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net proved reserves at December&#160;31, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,044
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,239
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,251
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Proved developed reserves, December&#160;31, 2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,266
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,083
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,447
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Proved undeveloped reserves, December&#160;31, 2007</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    778
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    156
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    804
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Proved reserves</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Beginning balance
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,044
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,239
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,251
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revisions of previous estimates
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,604
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (479
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,684
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Extensions, discoveries and other additions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    132
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    137
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Sales of reserves in place
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Purchases of reserves in place
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (379
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (123
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (400
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net proved reserves at December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,193
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    671
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,304
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Proved developed reserves, December&#160;31, 2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,193
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    671
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,304
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Proved undeveloped reserves, December&#160;31, 2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Proved reserves</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Beginning balance
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,193
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    671
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,304
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revisions of previous estimates
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    781
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (84
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    767
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Extensions, discoveries and other additions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,381
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,414
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,950
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Sales of reserves in place
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (16
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Purchases of reserves in place
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,726
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,611
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,995
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (658
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (326
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (712
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net proved reserves at December&#160;31, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,421
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,270
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,299
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Proved developed reserves, December&#160;31, 2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,231
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,293
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,613
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Proved undeveloped reserves, December&#160;31, 2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,190
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,977
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-29
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (a) </TD>
    <TD></TD>
    <TD valign="bottom">
    No beginning balance as the Company purchased the reserves from
    Bill Barrett Corporation in July 2007. Amounts represent changes
    from the date of acquisition to December&#160;31, 2007.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Purchases
    of Reserves in Place</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Of the total 1,995&#160;MBoe of reserves purchased in 2009,
    1,511&#160;MBoe were from the Kerogen Acquisition Properties and
    484&#160;MBoe were from the Fidelity Acquisition Properties. The
    Company did not purchase reserves in place in 2008. In 2007, all
    of the 4,171&#160;MBoe of total reserves purchased were from the
    properties acquired from Bill Barrett Corporation located in the
    Williston Basin.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Extensions,
    Discoveries and Other Additions</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2009, the Company had a total of 8,950&#160;MBoe of
    additions. An estimated 1,508&#160;MBoe of extensions and
    discoveries were associated with new wells, which were producing
    at December&#160;31, 2009, with approximately 95% of these
    reserves from wells producing in the Bakken or Three Forks
    formations. An additional 7,442&#160;MBoe of proved undeveloped
    reserves were added across all three of the Company&#146;s
    Williston Basin project areas associated with the Company&#146;s
    2009 operated and non-operated drilling program, with 100% of
    these proved undeveloped reserves in the Bakken or Three Forks
    formations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2008, the Company had a total of 137&#160;MBoe of additions.
    An estimated 127&#160;MBoe resulted from the Company&#146;s 2008
    Bakken drilling program in the East Nesson project area.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2007, the Company had a total of 286&#160;MBoe of additions.
    Approximately 81&#160;MBoe resulted from non-operated wells in
    the Company&#146;s Bakken drilling program in the West Williston
    project area. The Company also added an estimated 205&#160;MBoe
    of proved undeveloped reserves in the conventional Madison
    formation.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Sales of
    Reserves in Place</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2009, the Company sold a portion its interests in non-core
    oil and gas producing properties located in the Barnett shale in
    Texas, which had minimal impact on the Company&#146;s proved
    reserves. The Company had no divestitures for the year ended
    December&#160;31, 2008 and the period ended December&#160;31,
    2007.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Revisions
    of Previous Estimates</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2009, the Company had net positive revisions of
    767&#160;MBoe, primarily due to the increase in oil prices. The
    unweighted arithmetic average
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    prices for the 12&#160;months prior were $61.04/bbl as compared
    to the market price for oil of $44.60/bbl used for the
    December&#160;31, 2008 reserves.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2008, the Company had net negative revisions of
    1,684&#160;MBoe. An estimated 461&#160;MBoe reduction resulted
    from poor drilling results in the conventional Madison
    formation, including proved undeveloped locations offsetting the
    Madison formation drilling results. The remaining
    net&#160;1,223&#160;MBoe reduction is primarily related to the
    decrease in oil price, including 461&#160;MBoe of proved
    undeveloped reserves at December&#160;31, 2007, which did not
    have a positive
    <FONT style="white-space: nowrap">PV-10</FONT> at the
    lower oil prices and were removed from the December&#160;31,
    2008 reserves. The index price for oil at December&#160;31, 2008
    decreased to $44.60/bbl from $96.00/bbl at December&#160;31,
    2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2007, the Company had net negative revisions of 35&#160;MBoe.
    These revisions primarily resulted from adjustments to the
    performance projections and price assumptions used to calculate
    reserves at December&#160;31, 2007 compared to those used in the
    initial evaluation of the properties acquired from Bill Barrett
    Corporation in June 2007.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-30
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Standardized
    Measure of Discounted Future Net Cash Flows Relating to Proved
    Oil and Natural Gas Reserves&#160;&#151; Unaudited</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Standardized Measure represents the present value of
    estimated future cash inflows from proved oil and natural
    reserves, less future development, production, plugging and
    abandonment costs and income tax expenses, discounted at 10% per
    annum to reflect timing of future cash flows. Production costs
    do not include depreciation, depletion and amortization of
    capitalized acquisition, exploration and development costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our estimated proved reserves and related future net revenues
    and Standardized Measure were determined using index prices for
    oil and natural gas, without giving effect to derivative
    transactions, and were held constant throughout the life of the
    properties. The index prices were $96.00/Bbl for oil and
    $7.16/MMBtu for natural gas at December&#160;31, 2007, and
    $44.60/Bbl for oil and $5.63/MMBtu for natural gas at
    December&#160;31, 2008, and the unweighted arithmetic average
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    prices for the prior 12&#160;months were $61.04/Bbl for oil and
    $3.87/MMBtu for natural gas at December&#160;31, 2009.  These
    prices were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead. The
    impact of the adoption of the FASB&#146;s authoritative guidance
    on the SEC oil and gas reserve estimation final rule on our
    financial statements is not practicable to estimate due to the
    operational and technical challenges associated with calculating
    a cumulative effect of adoption by preparing reserve reports
    under both the old and new rules.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth the Standardized Measure of
    discounted future net cash flows from projected production of
    the Company&#146;s oil and natural gas reserves at
    December&#160;31, 2009, 2008 and 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="66%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>At Year Ended December&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future cash inflows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    664,480
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    85,678
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    365,725
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future production costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (258,137
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (54,885
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (117,094
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future development costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (120,212
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,708
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (20,792
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future income tax expense(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future net cash flows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    286,131
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27,085
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    227,839
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    10% annual discount for estimated timing of cash flows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (152,601
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,355
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (106,032
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Standardized measure of discounted future net cash flows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    133,530
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17,730
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    121,807
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Does not include the effects of income taxes on future net
    revenues because as of December&#160;31, 2009, 2008 and 2007,
    the Company was a limited liability company not subject to
    entity-level taxation. Accordingly, no provision for federal or
    state corporate income taxes has been provided because taxable
    income is passed through to the company&#146;s equity holders.</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-31
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth the changes in the standardized
    measure of discounted future net cash flows applicable to proved
    oil and natural gas reserves for the periods presented.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="68%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007(1)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    January&#160;1,
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17,730
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    121,807
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net changes in prices and production costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,423
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (48,986
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38,863
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net changes in future development costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,998
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    210
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,529
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Sales of oil and natural gas, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (25,254
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (24,662
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,634
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Extensions
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    71,333
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,648
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,429
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Discoveries
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Purchases of reserves in place
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36,809
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    78,965
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Sales of reserves in place
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (108
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revisions of previous quantity estimates
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,700
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (48,260
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (667
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Previously estimated development costs incurred
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    746
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,476
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accretion of discount
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,352
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,181
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,948
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net change in income taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Changes in timing and other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,547
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,046
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,956
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December&#160;31,
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    133,530
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17,730
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    121,807
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    No beginning balance as the Company purchased the reserves from
    Bill Barrett Corporation in July 2007. Amounts represent changes
    from the date of acquisition to December&#160;31, 2007.</TD>
</TR>

</TABLE>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">14.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Quarterly
    Financial Data&#160;&#151; Unaudited</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s results of operations by quarter for the
    years ended 2009 and 2008 are as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="61%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>For the Year Ended December&#160;31, 2009:</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>First<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Second<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Third<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fourth<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Quarter</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Quarter</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Quarter(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Quarter</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,216
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,036
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11,046
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    17,457
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Impairment of oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    441
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    809
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,613
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,370
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,091
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,536
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (329
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,599
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (5,512
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (5,883
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (171
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (3,643
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="61%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>For the Year Ended December&#160;31, 2008:</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>First<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Second<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Third<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fourth<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Quarter</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Quarter</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Quarter</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Quarter</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="15" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8,467
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,531
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,956
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,782
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Impairment of oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    259
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    884
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45,882
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,420
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,106
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,593
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (48,934
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net income (loss)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (3,760
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (25,361
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    23,287
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28,557
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    The Company recorded an adjustment to expense in the amount of
    $272,000 in the third quarter of 2009 associated with plugging
    and abandonment costs incurred in 2008.</TD>
</TR>

</TABLE>
<!-- /XBRL,ns -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-32
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='306'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Report of
    Independent Registered Public Accounting Firm</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the Board of Directors and Stockholders of Oasis Petroleum
    Inc.:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In our opinion, the accompanying balance sheet presents fairly,
    in all material respects, the financial position of Oasis
    Petroleum Inc. at February&#160;25, 2010 in conformity with
    accounting principles generally accepted in the United States of
    America. This financial statement is the responsibility of Oasis
    Petroleum Inc.&#146;s management. Our responsibility is to
    express an opinion on this financial statement based on our
    audit. We conducted our audit of this statement in accordance
    with the standards of the Public Company Accounting Oversight
    Board (United States). Those standards require that we plan and
    perform the audit to obtain reasonable assurance about whether
    the balance sheet is free of material misstatement. An audit
    includes examining, on a test basis, evidence supporting the
    amounts and disclosures in the balance sheet, assessing the
    accounting principles used and significant estimates made by
    management, and evaluating the overall balance sheet
    presentation. We believe that our audit provides a reasonable
    basis for our opinion.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    /s/ PricewaterhouseCoopers LLP
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Houston, Texas
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    March&#160;4, 2010
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-33
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='307'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum Inc.<BR>
    Balance Sheet</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>February&#160;25, 2010</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Assets</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Shareholders&#146; equity</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Common stock, $0.01&#160;par value; authorized
    1,000&#160;shares; 1,000 issued and outstanding at
    February&#160;25, 2010
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total shareholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    See the accompanying notes to the balance sheet.
</DIV>
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    <BR>
    F-34
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Oasis
    Petroleum Inc.<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='308'><B><FONT style="font-family: 'Times New Roman', Times">Notes
    to Balance Sheet</FONT></B></A>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">1.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Nature of
    Operations</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Oasis Petroleum Inc. (&#147;Oasis&#148; or &#147;Company&#148;)
    was formed on February&#160;25, 2010, pursuant to the laws of
    the State of Delaware to become a holding company for Oasis
    Petroleum LLC.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">2.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    of Significant Accounting Policies</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Basis
    of Presentation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This balance sheet has been prepared in accordance with
    accounting principles generally accepted in the United States of
    America (&#147;GAAP&#148;). Separate Statements of Income,
    Changes in Stockholder&#146;s Equity and of Cash Flows have not
    been presented because Oasis has had no business transactions or
    activities to date.
</DIV>
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    <BR>
    F-35
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='309'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Report of
    Independent Registered Public Accounting Firm</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the Board of Managers of Oasis Petroleum LLC:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In our opinion, the accompanying statement of revenues and
    direct operating expenses presents fairly, in all material
    respects, the revenues and direct operating expenses of the Bill
    Barrett Corporation Acquisition Properties described in
    Note&#160;1 for the six months ended June&#160;30, 2007, in
    conformity with accounting principles generally accepted in the
    United States of America. This financial statement is the
    responsibility of Oasis Petroleum LLC&#146;s management. Our
    responsibility is to express an opinion on this financial
    statement based on our audit. We conducted our audit of this
    statement in accordance with the standards of the Public Company
    Accounting Oversight Board (United States). Those standards
    require that we plan and perform the audit to obtain reasonable
    assurance about whether the financial statement is free of
    material misstatement. An audit includes examining, on a test
    basis, evidence supporting the amounts and disclosures in the
    financial statement, assessing the accounting principles used
    and significant estimates made by management, and evaluating the
    overall financial statement presentation. We believe that our
    audit provides a reasonable basis for our opinion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying financial statement reflects the revenues and
    direct operating expenses of the Bill Barrett Corporation
    Acquisition Properties as described in Note&#160;1 and is not
    intended to be a complete presentation of the financial
    position, results of operations, or cash flows of the Bill
    Barrett Corporation Acquisition Properties.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    /s/ PricewaterhouseCoopers LLP
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Houston, Texas
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    March&#160;4, 2010
</DIV>
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    <BR>
    F-36
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Bill
    Barrett Corporation Acquisition Properties (as Predecessor)<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='310'><B><FONT style="font-family: 'Times New Roman', Times">Statement
    of Revenue and Direct Operating Expenses</FONT></B></A>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="88%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Six Months<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil and gas revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10,686
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Direct operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,490
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Excess of revenues over direct operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,196
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    See accompanying notes to the Statement of Revenues and Direct
    Operating Expenses.
</DIV>
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    <BR>
    F-37
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Bill
    Barrett Corporation Acquisition Properties (as Predecessor)<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='311'><B><FONT style="font-family: 'Times New Roman', Times">Notes
    to Statement of Revenues and Direct Operating
    Expenses</FONT></B></A>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">1.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Properties
    and Basis of Presentation</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying statement represents the interest in the
    revenues and direct operating expenses of the oil and natural
    gas producing properties acquired by Oasis Petroleum LLC (the
    &#147;Company&#148;) from Bill Barrett Corporation
    (&#147;Barrett&#148;) in June 2007, which constitutes the
    accounting predecessor to the Company. The purchase transaction
    had an effective date of May&#160;1, 2007 and the Company paid
    $83.5&#160;million for the properties, subject to customary
    purchase accounting adjustments. The properties are referred to
    herein as the &#147;Barrett Acquisition Properties&#148;. The
    Barrett Acquisition Properties are located in the Williston
    Basin of Montana and North Dakota. The Company closed the
    acquisition on June&#160;22, 2007 and began managing the
    properties effective July&#160;1, 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The statement of revenues and direct operating expenses has been
    derived from Barrett&#146;s historical financial records.
    Revenues and direct operating expenses relate to the historical
    net revenue interest and net working interest, respectively, in
    the Barrett Acquisition Properties. Oil, gas and condensate
    revenues are recognized when production is sold to a purchaser
    at a fixed or determinable price, when delivery has occurred and
    title has transferred, and if collectability of the revenue is
    probable. Revenues are reported net of overriding and other
    royalties due to third parties. Direct operating expenses
    include lease and well repairs, production taxes, gathering and
    transportation, maintenance, utilities, payroll and other direct
    operating expenses. Production taxes for the six months ended
    June&#160;30, 2007 totaled $907,000.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the period presented, the Barrett Acquisition Properties
    were not accounted for as a separate entity. Certain costs, such
    as depreciation, depletion and amortization, accretion of asset
    retirement obligations, general and administrative expenses and
    interest expense were not allocated to the Barrett Acquisition
    Properties.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">2.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Omitted
    Financial Information</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Historical financial statements reflecting financial position,
    results of operations and cash flows required by accounting
    principles generally accepted in the United States of America
    are not presented as such information is not available on an
    individual property basis, nor is it practicable to obtain such
    information in these circumstances. Historically, no allocation
    of general and administrative, interest, corporate taxes,
    accretion of asset retirement obligations, and depreciation,
    depletion and amortization was made to the Barrett Acquisition
    Properties. Accordingly, the statement of revenues and direct
    operating expenses is presented in lieu of the financial
    statements required under
    <FONT style="white-space: nowrap">Rule&#160;3-01</FONT>
    and
    <FONT style="white-space: nowrap">Rule&#160;3-02</FONT>
    of the Securities and Exchange Commission&#146;s
    <FONT style="white-space: nowrap">Regulation&#160;S-X.</FONT>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">3.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Supplemental
    Oil and Gas Reserve Information&#160;&#151; Unaudited</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Estimated
    Quantities of Proved Oil and Natural Gas Reserves&#160;&#151;
    Unaudited</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following tables summarize the net ownership interests in
    estimated quantities of proved and proved developed oil and
    natural gas reserves of the Barrett Acquisition Properties at
    January 1, 2007 and June&#160;30, 2007, estimated by the
    Company&#146;s petroleum engineers, and the related summary of
    changes in estimated quantities of net remaining proved reserves
    during the six months ended June&#160;30, 2007.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Proved reserves are estimated quantities of oil and natural gas
    which geological and engineering data demonstrate, with
    reasonable certainty, to be recoverable in future years from
    known reservoirs under existing economic and operating
    conditions (i.e., prices and costs) existing at the time the
    estimate is made. Proved
</DIV>
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    <BR>
    F-38
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Bill
    Barrett Corporation Acquisition Properties (as Predecessor)<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Statement of Revenues and Direct Operating
    Expenses&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    developed reserves are proved reserves that can be expected to
    be recovered through existing wells and equipment in place and
    under operating methods being utilized at the time the estimates
    were made.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="79%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Natural Gas<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Oil<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MMcf)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MBbls)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved reserves at January&#160;1, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,202
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,172
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Production through June&#160;30, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (69
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (190
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved reserves at June&#160;30, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,133
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,982
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="81%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Natural Gas<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Oil<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MMcf)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MBbls)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved developed reserves at January&#160;1, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    989
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,287
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved developed reserves at June&#160;30, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    920
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,097
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="81%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Natural Gas<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Oil<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MMcf)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MBbls)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved undeveloped reserves at January&#160;1, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    213
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    885
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved undeveloped reserves at June&#160;30, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    213
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    885
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Standardized
    Measure of Discounted Future Net Cash Flows Relating to Proved
    Oil and Natural Gas Reserves&#160;&#151; Unaudited</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following tables sets forth the computation of the
    standardized measure of discounted future net cash flows (the
    &#147;Standardized Measure&#148;) relating to proved reserves
    and the changes in such cash flows of the Barrett Acquisition
    Properties in accordance with the Financial Accounting Standards
    Board&#146;s (&#147;FASB&#148;) authoritative guidance related
    to disclosures about oil and gas producing activities. The
    Standardized Measure is the estimated net future cash inflows
    from proved reserves less estimated future production and
    development costs, estimated plugging and abandonment costs,
    estimated future income taxes (if applicable) and a discount
    factor. Production costs do not include depreciation, depletion
    and amortization of capitalized acquisitions, exploration and
    development costs. Future cash inflows represent expected
    revenues from production of period-end quantities of proved
    reserves based on period-end prices and any fixed and
    determinable future price changes provided by contractual
    arrangements in existence at year end. Price changes based on
    inflation, federal regulatory changes and supply and demand are
    not considered. Estimated future production costs related to
    period-end reserves are based on period-end costs. Such costs
    include, but are not limited to, production taxes and direct
    operating costs. Inflation and other anticipatory costs are not
    considered until the actual cost change takes effect. In
    accordance with the FASB&#146;s authoritative guidance, a
    discount rate of 10% is applied to the annual future net cash
    flows.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In calculating the Standardized Measure, future net cash inflows
    were estimated by using period-end oil and natural gas prices
    with the estimated future production of period-end proved
    reserves and assume continuation of existing economic
    conditions. The index prices used for the June&#160;30, 2007
    Standardized Measure calculations were $70.68 per barrel of oil
    and $6.36 per MMBtu of natural gas. Future cash inflows were
    reduced by estimated future development, abandonment and
    production costs based on period-end costs resulting in net cash
    flow before tax. Future income tax expense was not considered as
    Oasis Petroleum LLC and the Barrett Acquisition Properties are
    not tax-paying entities.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-39
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Bill
    Barrett Corporation Acquisition Properties (as Predecessor)<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Statement of Revenues and Direct Operating
    Expenses&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Standardized Measure is not intended to be representative of
    the fair market value of the proved reserves. The calculations
    of revenues and costs do not necessarily represent the amounts
    to be received or expended. Accordingly, the estimates of future
    net cash flows from proved reserves and the present value
    thereof may not be materially correct when judged against actual
    subsequent results. Further, since prices and costs do not
    remain static, and no price or cost changes have been
    considered, and future production and development costs are
    estimates to be incurred in developing and producing the
    estimated proved oil and gas reserves, the results are not
    necessarily indicative of the fair market value of estimated
    proved reserves, and the results may not be comparable to
    estimates disclosed by other oil and gas producers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="87%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>June&#160;30, 2007</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future cash inflows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    261,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future production costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (97,444
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future development costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (20,741
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Future net cash flows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    143,111
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    10% annual discount for estimating timing of cash flows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (64,997
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Standardized Measure of discounted net cash flows relating to
    proved oil and gas reserves
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    78,114
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Changes in the Standardized Measure (in thousands) of the
    Barrett Acquisition Properties are as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="91%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    January&#160;1, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    65,434
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Changes in prices and costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,473
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accretion of discount
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,403
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Sales of oil and gas, net of costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,196
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    June&#160;30, 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    78,114
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-40
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='312'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Report of
    Independent Registered Public Accounting Firm</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the Board of Managers of Oasis Petroleum LLC:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In our opinion, the accompanying statement of revenues and
    direct operating expenses presents fairly, in all material
    respects, the revenues and direct operating expenses of the
    Kerogen Acquisition Properties described in Note&#160;1 for the
    year ended December&#160;31, 2008, in conformity with accounting
    principles generally accepted in the United States of America.
    This financial statement is the responsibility of Oasis
    Petroleum LLC&#146;s management. Our responsibility is to
    express an opinion on this financial statement based on our
    audit. We conducted our audit of this statement in accordance
    with the standards of the Public Company Accounting Oversight
    Board (United States). Those standards require that we plan and
    perform the audit to obtain reasonable assurance about whether
    the financial statement is free of material misstatement. An
    audit includes examining, on a test basis, evidence supporting
    the amounts and disclosures in the financial statement,
    assessing the accounting principles used and significant
    estimates made by management, and evaluating the overall
    financial statement presentation. We believe that our audit
    provides a reasonable basis for our opinion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying financial statement reflects the revenues and
    direct operating expenses of the Kerogen Acquisition Properties
    as described in Note&#160;1 and is not intended to be a complete
    presentation of the financial position, results of operations,
    or cash flows of the Kerogen Acquisition Properties.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    /s/ PricewaterhouseCoopers LLP
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Houston, Texas
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    March&#160;4, 2010
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-41
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Kerogen
    Acquisition Properties<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='313'><B><FONT style="font-family: 'Times New Roman', Times">Statements
    of Revenues and Direct Operating Expenses</FONT></B></A>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="64%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Three Months Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>March&#160;31,</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Unaudited)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Oil and gas revenues
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    16,578
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,084
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,072
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Direct operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,460
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    234
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,146
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Excess of revenues over direct operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,118
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    850
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    926
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    See accompanying notes to the Statement of Revenues and Direct
    Operating Expenses.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-42
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Kerogen
    Acquisition Properties<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='314'><B><FONT style="font-family: 'Times New Roman', Times">Notes
    to Statements of Revenues and Direct Operating
    Expenses</FONT></B></A>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">1.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Properties
    and Basis of Presentation</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying statements represent the interest in the
    revenue and direct operating expenses of the oil and natural gas
    producing properties acquired by Oasis Petroleum LLC (the
    &#147;Company&#148;) from Kerogen Resources, Inc.
    (&#147;Kerogen&#148;) on June&#160;15, 2009 for
    $27.1&#160;million, subject to customary purchase accounting
    adjustments. The properties are referred to herein as the
    &#147;Kerogen Acquisition Properties&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The statement of revenues and direct operating expenses for the
    year ended December&#160;31, 2008 has been derived from
    Kerogen&#146;s historical financial records. Revenues and direct
    operating expenses relate to the historical net revenue interest
    and net working interest, respectively, in the Kerogen
    Acquisition Properties. Oil, gas and condensate revenues are
    recognized when production is sold to a purchaser at a fixed or
    determinable price, when delivery has occurred and title has
    transferred, and if collectability of the revenue is probable.
    Revenues are reported net of overriding and other royalties due
    to third parties. Direct operating expenses include lease and
    well repairs, production taxes, gathering and transportation,
    maintenance, utilities, payroll and other direct operating
    expenses. Production taxes for the year ended December&#160;31,
    2008 were $1.3&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the periods presented, the Kerogen Acquisition Properties
    were not accounted for as a separate entity. Certain costs such
    as depreciation, depletion and amortization, accretion of asset
    retirement obligations, general and administrative expenses and
    interest expense were not allocated to the Kerogen Acquisition
    Properties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying statements of revenues and direct operating
    expenses for the three months ended March&#160;31, 2008 and 2009
    are unaudited. The unaudited interim statements of revenues and
    direct operating expenses have been derived from Kerogen&#146;s
    historical financial records and prepared on the same basis as
    the statement of revenues and direct operating expenses for the
    year ended December&#160;31, 2008. In the opinion of management,
    such unaudited interim statements reflect all adjustments
    necessary to fairly present the Kerogen Acquisition
    Properties&#146; excess of revenue over direct operating
    expenses for the three months ended March&#160;31, 2008 and 2009.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">2.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Omitted
    Financial Information</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Historical financial statements reflecting financial position,
    results of operations and cash flows required by accounting
    principles generally accepted in the United States of America
    are not presented as such information is not available on an
    individual property basis, nor is it practicable to obtain such
    information in these circumstances. Historically, no allocation
    of general and administrative, interest, corporate taxes,
    accretion of asset retirement obligations, depreciation,
    depletion and amortization was made to the Kerogen Acquisition
    Properties. Accordingly, the statements of revenues and direct
    operating expenses are presented in lieu of the financial
    statements required under
    <FONT style="white-space: nowrap">Rule&#160;3-01</FONT>
    and
    <FONT style="white-space: nowrap">Rule&#160;3-02</FONT>
    of the Securities and Exchange Commission&#146;s
    <FONT style="white-space: nowrap">Regulation&#160;S-X.</FONT>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">3.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Supplemental
    Oil and Gas Reserve Information (Unaudited)</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Estimated
    Quantities of Proved Oil and Natural Gas Reserves&#160;&#151;
    Unaudited</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following tables summarize the net ownership interests in
    estimated quantities of proved and proved developed oil and
    natural gas reserves of the Kerogen Acquisition Properties at
    January&#160;1, 2008 and December&#160;31, 2008, estimated by
    the Company&#146;s petroleum engineers, and the related summary
    of changes in estimated quantities of net remaining proved
    reserves during the year.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-43
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Kerogen
    Acquisition Properties<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Statements of Revenues and Direct Operating
    Expenses&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Proved reserves are estimated quantities of oil and natural gas
    which geological and engineering data demonstrate, with
    reasonable certainty, to be recoverable in future years from
    known reservoirs under existing economic and operating
    conditions (i.e., prices and costs) existing at the time the
    estimate was made. Proved developed reserves are proved reserves
    that can be expected to be recovered through existing wells and
    equipment in place and under operating methods being utilized at
    the time the estimates were made.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="79%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Natural Gas<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Oil<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MMcf)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MBbls)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved reserves at January&#160;1, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,825
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,557
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Production in 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (299
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (172
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved reserves at December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,526
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,385
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="81%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Natural Gas<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Oil<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MMcf)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MBbls)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved developed reserves at January&#160;1, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,588
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,079
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved developed reserves at December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,289
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    907
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="81%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Natural Gas<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Oil<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MMcf)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(MBbls)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved undeveloped reserves at January&#160;1, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    237
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    478
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proved undeveloped reserves at December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    237
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    478
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Standardized
    Measure of Discounted Future Net Cash Flows Relating to Proved
    Oil and Gas Reserves&#160;&#151; Unaudited</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following tables set forth the computation of the
    standardized measure of discounted future net cash flows (the
    &#147;Standardized Measure&#148;) relating to proved reserves
    and the changes in such cash flows of the Kerogen Acquisition
    Properties in accordance with the Financial Accounting Standards
    Board&#146;s (&#147;FASB&#148;) authoritative guidance related
    to disclosures about oil and gas producing activities. The
    Standardized Measure is the estimated net future cash inflows
    from proved reserves less estimated future production and
    development costs, estimated plugging and abandonment costs,
    estimated future income taxes (if applicable) and a discount
    factor. Production costs do not include depreciation, depletion
    and amortization of capitalized acquisition, exploration and
    development costs. Future cash inflows represent expected
    revenues from production of period-end quantities of proved
    reserves based on period-end prices and any fixed and
    determinable future price changes provided by contractual
    arrangements in existence at year end. Price changes based on
    inflation, federal regulatory changes and supply and demand are
    not considered. Estimated future production costs related to
    period-end reserves are based on period-end costs. Such costs
    include, but are not limited to, production taxes and direct
    operating costs. Inflation and other anticipatory costs are not
    considered until the actual cost change takes effect. In
    accordance with the FASB&#146;s authoritative guidance, a
    discount rate of 10% is applied to the annual future net cash
    flows.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In calculating the Standardized Measure, future net cash inflows
    were estimated by using year-end oil and natural gas prices with
    the estimated future production of year-end proved reserves and
    assume continuation of existing economic conditions. The index
    prices used for the December&#160;31, 2008 Standardized Measure
    calculations were $44.60 per barrel of oil and $5.63 per MMBtu
    of natural gas. Future cash inflows were reduced by estimated
    future development, abandonment and production costs based on
    year-end costs resulting in net cash flow before tax. Future
    income tax expense was not considered as Oasis Petroleum LLC and
    the Kerogen Acquisition Properties are not tax paying entities.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-44
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Kerogen
    Acquisition Properties<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Statements of Revenues and Direct Operating
    Expenses&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Standardized Measure is not intended to be representative of
    the fair market value of the proved reserves. The calculations
    of revenues and costs do not necessarily represent the amounts
    to be received or expended. Accordingly, the estimates of future
    net cash flows from proved reserves and the present value
    thereof may not be materially correct when judged against actual
    subsequent results. Further, since prices and costs do not
    remain static, and no price or cost changes have been
    considered, and future production and development costs are
    estimates to be incurred in developing and producing the
    estimated proved oil and gas reserves, the results are not
    necessarily indicative of the fair market value of estimated
    proved reserves, and the results may not be comparable to
    estimates disclosed by other oil and gas producers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="87%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future cash inflows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    63,010
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future production costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (34,433
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Future development costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (6,853
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Future net cash flows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,724
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    10% annual discount for estimating timing of cash flows
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,756
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Standardized measure of discounted net cash flows relating to
    proved oil and gas reserves
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,968
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Changes in the Standardized Measure (in thousands) of the
    Kerogen Acquisition Properties are as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="90%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    January&#160;1, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    55,161
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Changes in prices and costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (29,353
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accretion of discount
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,278
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Sales of oil and gas, net of costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,118
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December&#160;31, 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,968
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-45
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Kerogen
    Acquisition Properties<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='315'><B><FONT style="font-family: 'Times New Roman', Times">Unaudited
    Pro Forma Financial Information</FONT></B></A>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On June&#160;15, 2009, Oasis Petroleum LLC (the
    &#147;Company&#148;) acquired interests in oil and gas
    properties primarily in the East Nesson area of the Williston
    Basin from Kerogen Resources, Inc. (the &#147;Kerogen
    Acquisition Properties&#148;) for $27.1&#160;million. The
    purchase price was paid using proceeds from a capital
    contribution from the members. In addition to acquiring the
    interests in the East Nesson area, the Company also acquired
    non-operated interests in the Sanish project area.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following unaudited pro forma statement of operations shows
    the pro forma effect of the acquisition of the Kerogen
    Acquisition Properties. The Company&#146;s historical results
    include the results from the acquisition of the Kerogen
    Acquisition Properties beginning on June&#160;15, 2009. A pro
    forma balance sheet has not been presented since the acquisition
    has been reflected in the Company&#146;s December&#160;31, 2009
    consolidated balance sheet included elsewhere in this
    prospectus. The unaudited pro forma statement of operations for
    the year ended December&#160;31, 2009 presented below was
    prepared as if the acquisition occurred on January&#160;1, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
     The unaudited pro forma statement of operations does not
    reflect the pro forma effect of any of the Company&#146;s other
    recent acquisitions discussed in this prospectus as they were
    not deemed significant, nor does this statement reflect the
    transactions described under &#147;Corporate
    Reorganization.&#148; The Company has conducted its operations
    as a limited liability company with substantially all earnings
    taxed at the stockholder level. Following its corporate
    reorganization, the Company will be subject to Subchapter C of
    the Internal Revenue Code, and, as a result, will become taxable
    as a corporation and subject to U.S.&#160;federal and state
    income taxes. No pro forma tax benefit has been reflected as
    management believes that it is more likely than not that such
    benefit would not be realized in the future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Management believes that the assumptions used to prepare the
    unaudited pro forma statement of operations provide a reasonable
    basis for presenting the significant effects directly
    attributable to the transaction. The following unaudited pro
    forma statement of operations does not purport to represent what
    the Company&#146;s results of operations would have been if the
    Kerogen property acquisition had occurred on January&#160;1,
    2009 and should be read in conjunction with the Company&#146;s
    historical consolidated financial statements and the notes to
    those financial statements and the accompanying statements of
    revenues and direct operating expenses for the Kerogen
    Acquisition Properties included elsewhere in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="49%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>For the Year Ended December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Kerogen Acquisition<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Properties Pro<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Oasis Historical</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Forma Adjustments</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Oasis Pro Forma</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Oil and gas revenues</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,755
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,244
</TD>
<TD nowrap align="left" valign="bottom">
    (1)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    41,999
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Expenses</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Lease operating expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,691
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,583
</TD>
<TD nowrap align="left" valign="bottom">
    (1)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10,274
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Production taxes
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,810
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    350
</TD>
<TD nowrap align="left" valign="bottom">
    (1)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,160
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Depreciation, depletion and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16,670
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,563
</TD>
<TD nowrap align="left" valign="bottom">
    (2)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exploration costs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Rig termination
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Impairment of oil and gas properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,233
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gain on sale of properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,455
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    General and administrative
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,342
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,342
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47,310
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,496
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    51,806
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <B>Operating loss</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,555
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (252
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (9,807
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-46
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Kerogen
    Acquisition Properties<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Unaudited
    Pro Forma Financial
    Information&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->
<!-- XBRL Table Pagebreak -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="49%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="11%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>For the Year Ended December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Kerogen Acquisition<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Properties Pro<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Oasis Historical</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Forma Adjustments</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Oasis Pro Forma</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="10" align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Other income (expense)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Change in unrealized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,043
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Realized gain (loss) on derivative instruments
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,296
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Interest expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (912
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total other income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,654
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (5,654
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <B>Net loss</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,209
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (252
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (15,461
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following adjustments were made in the preparation of the
    unaudited pro forma consolidated financial information presented
    above:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Adjustment to recognize revenues and direct operating expenses
    of the Kerogen Acquisition Properties for the period from
    January&#160;1, 2009 through June&#160;14, 2009, the period for
    which financial results are not included in the historical
    results of the Company.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Adjustment to recognize additional depreciation, depletion and
    amortization on the Kerogen Acquisition Properties as if the
    acquisition had taken place on January&#160;1, 2009, using the
    <FONT style="white-space: nowrap">unit-of-production</FONT>
    method under the successful efforts method of accounting. This
    adjustment also includes the additional accretion expense on the
    asset retirement obligations attributable to the Kerogen
    Acquisition Properties as if the acquisition had taken place on
    January&#160;1, 2009.</TD>
</TR>

</TABLE>
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    F-47
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='124'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">GLOSSARY
    OF OIL AND NATURAL GAS TERMS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The terms defined in this section are used throughout this
    prospectus:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Bbl.&#148;</I> One stock tank barrel, of 42
    U.S.&#160;gallons liquid volume, used herein in reference to
    crude oil, condensate or natural gas liquids.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Bcf.&#148;</I> One billion cubic feet of natural gas.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Boe.&#148;</I> Barrels of oil equivalent, with 6,000
    cubic feet of natural gas being equivalent to one barrel of oil.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;British thermal unit.&#148;</I> The heat required to
    raise the temperature of a one-pound mass of water from 58.5 to
    59.5 degrees Fahrenheit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Basin.&#148;</I> A large natural depression on the
    earth&#146;s surface in which sediments generally brought by
    water accumulate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Completion.&#148;</I> The process of treating a drilled
    well followed by the installation of permanent equipment for the
    production of natural gas or oil, or in the case of a dry hole,
    the reporting of abandonment to the appropriate agency.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Developed acreage.&#148;</I> The number of acres that
    are allocated or assignable to productive wells or wells capable
    of production.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Developed reserves.&#148;</I> Reserves of any category
    that can be expected to be recovered through existing wells with
    existing equipment and operating methods or for which the cost
    of required equipment is relatively minor when compared to the
    cost of a new well.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Development well.&#148;</I> A well drilled within the
    proved area of a natural gas or oil reservoir to the depth of a
    stratigraphic horizon known to be productive.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Dry hole.&#148;</I> A well found to be incapable of
    producing hydrocarbons in sufficient quantities such that
    proceeds from the sale of such production exceed production
    expenses and taxes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Economically producible.&#148;</I> A resource that
    generates revenue that exceeds, or is reasonably expected to
    exceed, the costs of the operation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Environmental assessment.&#148;</I> An environmental
    assessment, a study that can be required pursuant to federal law
    to assess the potential direct, indirect and cumulative impacts
    of a project.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Exploratory well.&#148;</I> A well drilled to find and
    produce natural gas or oil reserves not classified as proved, to
    find a new reservoir in a field previously found to be
    productive of natural gas or oil in another reservoir or to
    extend a known reservoir.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Field.&#148;</I> An area consisting of a single
    reservoir or multiple reservoirs all grouped on, or related to,
    the same individual geological structural feature or
    stratigraphic condition. The field name refers to the surface
    area, although it may refer to both the surface and the
    underground productive formations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Formation.&#148;</I> A layer of rock which has distinct
    characteristics that differ from nearby rock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Horizontal drilling.&#148;</I> A drilling technique
    used in certain formations where a well is drilled vertically to
    a certain depth and then drilled at a right angle within a
    specified interval.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Infill wells.&#148;</I> Wells drilled into the same
    pool as known producing wells so that oil or natural gas does
    not have to travel as far through the formation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;MBbl.&#148;</I> One thousand barrels of crude oil,
    condensate or natural gas liquids.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;MBoe.</I>&#148; One thousand barrels of oil equivalent.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Mcf.&#148;</I> One thousand cubic feet of natural gas.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;MMBbl.&#148;</I> One million barrels of crude oil,
    condensate or natural gas liquids.
</DIV>
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    <BR>
    A-1
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;MMBoe.&#148;</I> One million barrels of oil equivalent.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;MMBtu.&#148;</I> One million British thermal units.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;MMcf.&#148;</I> One million cubic feet of natural gas.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;NYMEX.&#148;</I> The New York Mercantile Exchange.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Net acres.&#148;</I> The percentage of total acres an
    owner has out of a particular number of acres, or a specified
    tract. An owner who has 50% interest in 100&#160;acres owns
    50&#160;net acres.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I><FONT style="white-space: nowrap">&#147;PV-10.&#148;</FONT></I>
    When used with respect to oil and natural gas reserves,
    <FONT style="white-space: nowrap">PV-10</FONT> means
    the estimated future gross revenue to be generated from the
    production of proved reserves, net of estimated production and
    future development and abandonment costs, using prices and costs
    in effect at the determination date, before income taxes, and
    without giving effect to non-property-related expenses,
    discounted to a present value using an annual discount rate of
    10% in accordance with the guidelines of the Commission.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Productive well.&#148;</I> A well that is found to be
    capable of producing hydrocarbons in sufficient quantities such
    that proceeds from the sale of the production exceed production
    expenses and taxes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Proved developed reserves.&#148;</I> Proved reserves
    that can be expected to be recovered through existing wells with
    existing equipment and operating methods.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Proved reserves.&#148;</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under SEC rules for fiscal years ending on or after
    December&#160;31, 2009, proved reserves are defined as:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Those quantities of oil and gas, which, by analysis of
    geoscience and engineering data, can be estimated with
    reasonable certainty to be economically producible&#160;&#151;
    from a given date forward, from known reservoirs, and under
    existing economic conditions, operating methods, and government
    regulations&#160;&#151; prior to the time at which contracts
    providing the right to operate expire, unless evidence indicates
    that renewal is reasonably certain, regardless of whether
    deterministic or probabilistic methods are used for the
    estimation. The project to extract the hydrocarbons must have
    commenced or the operator must be reasonably certain that it
    will commence the project within a reasonable time. The area of
    the reservoir considered as proved includes (i)&#160;the area
    identified by drilling and limited by fluid contacts, if any,
    and (ii)&#160;adjacent undrilled portions of the reservoir that
    can, with reasonable certainty, be judged to be continuous with
    it and to contain economically producible oil or gas on the
    basis of available geoscience and engineering data. In the
    absence of data on fluid contacts, proved quantities in a
    reservoir are limited by the lowest known hydrocarbons, LKH, as
    seen in a well penetration unless geoscience, engineering, or
    performance data and reliable technology establishes a lower
    contact with reasonable certainty. Where direct observation from
    well penetrations has defined a highest known oil, HKO,
    elevation and the potential exists for an associated gas cap,
    proved oil reserves may be assigned in the structurally higher
    portions of the reservoir only if geoscience, engineering, or
    performance data and reliable technology establish the higher
    contact with reasonable certainty. Reserves which can be
    produced economically through application of improved recovery
    techniques (including, but not limited to, fluid injection) are
    included in the proved classification when (i)&#160;successful
    testing by a pilot project in an area of the reservoir with
    properties no more favorable than in the reservoir as a whole,
    the operation of an installed program in the reservoir or an
    analogous reservoir, or other evidence using reliable technology
    establishes the reasonable certainty of the engineering analysis
    on which the project or program was based; and (ii)&#160;the
    project has been approved for development by all necessary
    parties and entities, including governmental entities. Existing
    economic conditions include prices and costs at which economic
    producibility from a reservoir is to be determined. The price
    shall be the average price during the
    <FONT style="white-space: nowrap">12-month</FONT>
    period prior to the ending date of the period covered by the
    report, determined as an unweighted arithmetic average of the
    <FONT style="white-space: nowrap">first-day-of-the-month</FONT>
    price for each month within such period, unless prices are
    defined by contractual arrangements, excluding escalations based
    upon future conditions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under SEC rules for fiscal years ending prior to
    December&#160;31, 2009, proved reserves are defined as:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The estimated quantities of crude oil, natural gas, and natural
    gas liquids which geological and engineering data demonstrate
    with reasonable certainty to be recoverable in future years from
    known reservoirs
</DIV>
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    <BR>
    A-2
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    under existing economic and operating conditions, i.e., prices
    and costs as of the date the estimate is made. Prices include
    consideration of changes in existing prices provided only by
    contractual arrangements, but not on escalations based upon
    future conditions. Reservoirs are considered proved if economic
    producibility is supported by either actual production or
    conclusive formation test. The area of a reservoir considered
    proved includes (A)&#160;that portion delineated by drilling and
    defined by gas-oil
    <FONT style="white-space: nowrap">and/or</FONT>
    oil-water contacts, if any, and (B)&#160;the immediately
    adjoining portions not yet drilled, but which can be reasonably
    judged as economically productive on the basis of available
    geological and engineering data. In the absence of information
    on fluid contacts, the lowest known structural occurrence of
    hydrocarbons controls the lower proved limit of the reservoir.
    Reserves which can be produced economically through application
    of improved recovery techniques (such as fluid injection) are
    included in the proved classification when successful testing by
    a pilot project, or the operation of an installed program in the
    reservoir, provides support for the engineering analysis on
    which the project or program was based. Estimates of proved
    reserves do not include the following: (A)&#160;Oil that may
    become available from known reservoirs but is classified
    separately as indicated additional reserves; (B)&#160;crude oil,
    natural gas, and natural gas liquids, the recovery of which is
    subject to reasonable doubt because of uncertainty as to
    geology, reservoir characteristics, or economic factors;
    (C)&#160;crude oil, natural gas, and natural gas liquids, that
    may occur in undrilled prospects; and (D)&#160;crude oil,
    natural gas, and natural gas liquids, that may be recovered from
    oil shales, coal, gilsonite and other such sources.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Proved undeveloped reserves.&#148;</I> Proved reserves
    that are expected to be recovered from new wells on undrilled
    acreage or from existing wells where a relatively major
    expenditure is required for recompletion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Reasonable certainty.&#148;</I> A high degree of
    confidence.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Recompletion.&#148;</I> The process of re-entering an
    existing wellbore that is either producing or not producing and
    completing new reservoirs in an attempt to establish or increase
    existing production.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Reserves.&#148;</I> Estimated remaining quantities of
    oil and natural gas and related substances anticipated to be
    economically producible as of a given date by application of
    development prospects to known accumulations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Reservoir.&#148;</I> A porous and permeable underground
    formation containing a natural accumulation of producible
    natural gas
    <FONT style="white-space: nowrap">and/or</FONT> oil
    that is confined by impermeable rock or water barriers and is
    separate from other reservoirs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Spacing.&#148;</I> The distance between wells producing
    from the same reservoir. Spacing is often expressed in terms of
    acres, e.g.,
    <FONT style="white-space: nowrap">40-acre</FONT>
    spacing, and is often established by regulatory agencies.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Unit.&#148;</I> The joining of all or substantially all
    interests in a reservoir or field, rather than a single tract,
    to provide for development and operation without regard to
    separate property interests. Also, the area covered by a
    unitization agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Wellbore.&#148;</I> The hole drilled by the bit that is
    equipped for oil or gas production on a completed well. Also
    called well or borehole.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Working interest.&#148;</I> The right granted to the
    lessee of a property to explore for and to produce and own oil,
    gas, or other minerals. The working interest owners bear the
    exploration, development, and operating costs on either a cash,
    penalty, or carried basis.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Part&#160;II<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">INFORMATION
    NOT REQUIRED IN PROSPECTUS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">ITEM&#160;13.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Other
    Expenses of Issuance and Distribution</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth an itemized statement of the
    amounts of all expenses (excluding underwriting discounts and
    commissions) payable by us in connection with the registration
    of the common stock offered hereby. With the exception of the
    Registration Fee, FINRA Filing Fee and New York Stock Exchange
    listing fee), the amounts set forth below are estimates. The
    selling stockholder will not bear any portion of such expenses.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="91%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    SEC Registration Fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    24,955
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    FINRA Filing Fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    New York Stock Exchange listing fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accountants&#146; fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Legal fees and expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Printing and engraving expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Transfer agent and registrar fees
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Miscellaneous
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">ITEM&#160;14.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Indemnification
    of Directors and Officers</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation provides that a director will
    not be liable to the corporation or its stockholders for
    monetary damages for breach of fiduciary duty as a director,
    except for liability (1)&#160;for any breach of the
    director&#146;s duty of loyalty to the corporation or its
    stockholders, (2)&#160;for acts or omissions not in good faith
    or which involved intentional misconduct or a knowing violation
    of the law, (3)&#160;under section&#160;174 of the DGCL for
    unlawful payment of dividends or improper redemption of stock or
    (4)&#160;for any transaction from which the director derived an
    improper personal benefit. In addition, if the DGCL is amended
    to authorize the further elimination or limitation of the
    liability of directors, then the liability of a director of the
    corporation, in addition to the limitation on personal liability
    provided for in our certificate of incorporation, will be
    limited to the fullest extent permitted by the amended DGCL. Our
    bylaws provide that the corporation will indemnify, and advance
    expenses to, any officer or director to the fullest extent
    authorized by the DGCL.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;145 of the DGCL provides that a corporation may
    indemnify directors and officers as well as other employees and
    individuals against expenses, including attorneys&#146; fees,
    judgments, fines and amounts paid in settlement in connection
    with specified actions, suits and proceedings whether civil,
    criminal, administrative, or investigative, other than a
    derivative action by or in the right of the corporation, if they
    acted in good faith and in a manner they reasonably believed to
    be in or not opposed to the best interests of the corporation
    and, with respect to any criminal action or proceeding, had no
    reasonable cause to believe their conduct was unlawful. A
    similar standard is applicable in the case of derivative
    actions, except that indemnification extends only to expenses,
    including attorneys&#146; fees, incurred in connection with the
    defense or settlement of such action and the statute requires
    court approval before there can be any indemnification where the
    person seeking indemnification has been found liable to the
    corporation. The statute provides that it is not exclusive of
    other indemnification that may be granted by a
    corporation&#146;s certificate of incorporation, bylaws,
    disinterested director vote, stockholder vote, agreement or
    otherwise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation also contains indemnification
    rights for our directors and our officers. Specifically, our
    certificate of incorporation provides that we shall indemnify
    our officers and directors to the fullest extent authorized by
    the DGCL. Further, we may maintain insurance on behalf of our
    officers and directors against expense, liability or loss
    asserted incurred by them in their capacities as officers and
    directors.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have obtained directors&#146; and officers&#146; insurance to
    cover our directors, officers and some of our employees for
    certain liabilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will enter into written indemnification agreements with our
    directors and executive officers. Under these proposed
    agreements, if an officer or director makes a claim of
    indemnification to us, either a majority of the independent
    directors or independent legal counsel selected by the
    independent directors must review the relevant facts and make a
    determination whether the officer or director has met the
    standards of conduct under Delaware law that would permit (under
    Delaware law) and require (under the indemnification agreement)
    us to indemnify the officer or director.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">ITEM&#160;15.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Recent
    Sales of Unregistered Securities</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with its formation in February 2010, Oasis
    Petroleum Inc. issued 1,000&#160;shares of its common stock to
    Oasis Petroleum LLC in exchange for consideration of $10.00. The
    issuance of shares did not involve any underwriters or a public
    offering, and we believe that such issuance was exempt from the
    registration requirements pursuant to Section&#160;4(2) of the
    Securities Act of 1933, as amended (the &#147;Securities
    Act&#148;).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the past three years, Oasis Petroleum LLC has issued
    additional membership interests in connection with capital
    contributions from its members, which consist of funds
    affiliated with EnCap Investments, L.P. (&#147;EnCap&#148;);
    Oasis Petroleum Management LLC, which is controlled by members
    of management of Oasis Petroleum Inc.; and other private
    investors. Capital contributions were $104.6&#160;million,
    $80.5&#160;million and $49.9&#160;million for the years ended
    December&#160;31, 2009 and 2008 and the period ended
    December&#160;31, 2007, respectively. None of these transactions
    involved any underwriters or any public offerings, and we
    believe that each of these transactions was exempt from the
    registration requirements pursuant to Section&#160;4(2) of the
    Securities Act.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">ITEM&#160;16.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Exhibits
    and Financial Statement Schedules</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;Exhibits
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=01 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=01 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=01 type=align1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="91%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Exhibit<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Number</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Description</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *1
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Underwriting Agreement
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *2
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Plan of Merger between Oasis Merger LLC and Oasis Petroleum LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *2
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Contribution Agreement between OAS Holding Company LLC
    and Oasis Petroleum International LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *3
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Certificate of Incorporation of Oasis
    Petroleum Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *3
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Bylaws of Oasis Petroleum Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *4
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Common Stock Certificate
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *5
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Opinion of Vinson&#160;&#038; Elkins L.L.P. as to the legality
    of the securities being registered
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Credit Agreement, dated as of
    February&#160;26, 2010, among Oasis Petroleum LLC, Oasis
    Petroleum North America LLC, BNP Paribas and the lenders party
    thereto.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Employment Agreement between Oasis Petroleum Inc. and
    Thomas&#160;B. Nusz
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Employment Agreement between Oasis Petroleum Inc. and
    Taylor&#160;L. Reid
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .4
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Registration Rights Agreement among Oasis Petroleum Inc. and OAS
    Holding Company LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .5
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Long-Term Incentive Plan of Oasis Petroleum Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .6
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Indemnification Agreement between Oasis Petroleum Inc.
    and each of the directors thereof
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *21
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    List of Subsidiaries of Oasis Petroleum Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of PricewaterhouseCoopers LLP
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of W.D. Von Gonten&#160;&#038; Co.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of DeGolyer and MacNaughton
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *23
</TD>
<TD nowrap align="left" valign="top">
    .4
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of Vinson&#160;&#038; Elkins L.L.P. (included as part of
    Exhibit&#160;5.1 hereto)
</TD>
</TR>
</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->
<!-- XBRL Table Pagebreak -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=01 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=01 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=01 type=align1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="91%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Exhibit<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Number</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Description</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    24
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Power of Attorney (included on the signature page of this
    registration statement)
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    99
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Report of W.D. Von Gonten &#038; Co. for reserves as of
    December&#160;31, 2007
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    99
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Report of W.D. Von Gonten &#038; Co. for reserves as of
    December&#160;31, 2008
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    99
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Report of DeGolyer and MacNaughton for reserves as of
    December&#160;31, 2009
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD valign="top">
    * </TD>
    <TD></TD>
    <TD valign="bottom">
    To be filed by amendment.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="10%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">ITEM&#160;17.<I>&#160;&#160;</I></FONT></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Undertakings</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The undersigned registrant hereby undertakes to provide to the
    underwriters at the closing specified in the underwriting
    agreement certificates in such denominations and registered in
    such names as required by the underwriters to permit prompt
    delivery to each purchaser.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Insofar as indemnification for liabilities arising under the
    Securities Act may be permitted to directors, officers and
    controlling persons of the registrant pursuant to the foregoing
    provisions, or otherwise, the registrant has been advised that
    in the opinion of the Securities and Exchange Commission such
    indemnification is against public policy as expressed in the
    Securities Act and is, therefore, unenforceable. In the event
    that a claim for indemnification against such liabilities (other
    than the payment by the registrant of expenses incurred or paid
    by a director, officer or controlling person of the registrant
    in the successful defense of any action, suit or proceeding) is
    asserted by such director, officer or controlling person in
    connection with the securities being registered, the registrant
    will, unless in the opinion of its counsel the matter has been
    settled by controlling precedent, submit to a court of
    appropriate jurisdiction the question whether such
    indemnification by it is against public policy as expressed in
    the Securities Act and will be governed by the final
    adjudication of such issue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The undersigned registrant hereby undertakes that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;For purposes of determining any liability under the
    Securities Act, the information omitted from the form of
    prospectus filed as part of this registration statement in
    reliance upon Rule&#160;430A and contained in a form of
    prospectus filed by the registrant pursuant to
    Rule&#160;424(b)(1) or (4)&#160;or 497(h) under the Securities
    Act shall be deemed to be part of this registration statement as
    of the time it was declared effective.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;For the purpose of determining any liability under the
    Securities Act, each post-effective amendment that contains a
    form of prospectus shall be deemed to be a new registration
    statement relating to the securities offered therein, and the
    offering of such securities at that time shall be deemed to be
    the initial bona fide offering thereof.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    II-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SIGNATURES</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the requirements of the Securities Act of 1933, the
    registrant has duly caused this registration statement to be
    signed on its behalf by the undersigned, thereunto duly
    authorized in the City of Houston, State of Texas, on
    March&#160;4, 2010.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>OASIS PETROLEUM INC.</B>
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Thomas
    B. Nusz</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Thomas B. Nusz
</DIV>

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Chairman, President and Chief Executive Officer
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each person whose signature appears below appoints Thomas B.
    Nusz and Taylor L. Reid, and each of them, any of whom may act
    without the joinder of the other, as his true and lawful
    attorneys-in-fact and agents, with full power of substitution
    and resubstitution, for him and in his name, place and stead, in
    any and all capacities, to sign any and all amendments
    (including post-effective amendments) to this registration
    statement and any registration statement (including any
    amendment thereto) for this offering that is to be effective
    upon filing pursuant to Rule&#160;462(b) under the Securities
    Act of 1933, as amended, and to file the same, with all exhibits
    thereto, and all other documents in connection therewith, with
    the Securities and Exchange Commission, granting unto said
    attorneys-in-fact and agents full power and authority to do and
    perform each and every act and thing requisite and necessary to
    be done, as fully to all intents and purposes as he might or
    would do in person, hereby ratifying and confirming all that
    said attorneys-in-fact and agents or any of them or their or his
    substitute or substitutes, may lawfully do or cause to be done
    by virtue hereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the requirements of the Securities Act of 1933, this
    registration statement has been signed by the following persons
    in the capacities and on the dates indicated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="2%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="39%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="39%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="13%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Signature</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Title</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Date</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 12pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;Thomas
    B. Nusz</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Thomas
    B. Nusz
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    Chairman, President and Chief<BR>
    Executive Officer<BR>
    (Principal Executive Officer)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    March&#160;4, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;Taylor
    L. Reid</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Taylor
    L. Reid
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    Director, Executive Vice President and Chief Operating Officer
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    March&#160;4, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;Roy
    W. Mace</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Roy
    W. Mace
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    Senior Vice President, Chief<BR>
    Accounting Officer and Corporate Secretary<BR>
    (Principal Financial Officer and<BR>
    Principal Accounting Officer)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    March&#160;4, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;Douglas
    E. Swanson, Jr.</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Douglas
    E. Swanson, Jr.
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    March&#160;4, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="top">
    <DIV style="display:inline; text-align:center; width:90%">/s/&#160;&#160;Robert
    L. Zorich</DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Robert
    L. Zorich
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    March&#160;4, 2010
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">INDEX TO
    EXHIBITS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=01 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=01 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=01 type=align1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="91%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Exhibit<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Number</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Description</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *1
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Underwriting Agreement
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *2
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Plan of Merger between Oasis Merger LLC and Oasis Petroleum LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *2
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Contribution Agreement between OAS Holding Company LLC
    and Oasis Petroleum International LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *3
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Certificate of Incorporation of Oasis
    Petroleum Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *3
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Bylaws of Oasis Petroleum Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *4
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Common Stock Certificate
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *5
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Opinion of Vinson&#160;&#038; Elkins L.L.P. as to the legality
    of the securities being registered
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amended and Restated Credit Agreement, dated as of
    February&#160;26, 2010, among Oasis Petroleum LLC, Oasis
    Petroleum North America LLC, BNP Paribas and the lenders party
    thereto.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Employment Agreement between Oasis Petroleum Inc. and
    Thomas&#160;B. Nusz
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Employment Agreement between Oasis Petroleum Inc. and
    Taylor&#160;L. Reid
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .4
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Registration Rights Agreement among Oasis Petroleum Inc. and OAS
    Holding Company LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .5
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Long-Term Incentive Plan of Oasis Petroleum Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *10
</TD>
<TD nowrap align="left" valign="top">
    .6
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Indemnification Agreement between Oasis Petroleum Inc.
    and each of the directors thereof
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *21
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    List of Subsidiaries of Oasis Petroleum Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of PricewaterhouseCoopers LLP
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of W.D. Von Gonten&#160;&#038; Co.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of DeGolyer and MacNaughton
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    *23
</TD>
<TD nowrap align="left" valign="top">
    .4
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of Vinson&#160;&#038; Elkins L.L.P. (included as part of
    Exhibit&#160;5.1 hereto)
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    24
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Power of Attorney (included on the signature page of this
    registration statement)
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    99
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Report of W.D. Von Gonten &#038; Co. for reserves as of
    December&#160;31, 2007
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    99
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Report of W.D. Von Gonten &#038; Co. for reserves as of
    December&#160;31, 2008
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    99
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Report of DeGolyer and MacNaughton for reserves as of
    December&#160;31, 2009
</TD>
</TR>
</TABLE>

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    <TD></TD>
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    To be filed by amendment.</TD>
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{"company-data": {"conformed-name": "Oasis Petroleum Inc.", "cik": "0001486159", "irs-number": "000000000", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-165212", "film-number": "10657296"}, "business-address": {"street1": "1001 FANNIN STREET", "street2": "SUITE 202", "city": "HOUSTON", "state": "TX", "zip": "77002", "phone": "713-547-1770"}, "mail-address": {"street1": "1001 FANNIN STREET", "street2": "SUITE 202", "city": "HOUSTON", "state": "TX", "zip": "77002"}}
sv1
Table of Contents
As filed with the Securities and Exchange Commission on March
    4, 2010
Registration
No. 333-
UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
Washington, D.C.
    20549
Form S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Oasis Petroleum Inc.
(Exact name of registrant as
    specified in its charter)
Delaware
1311
80-0554627
(State or other jurisdiction
    of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification No.)
1001 Fannin Street, Suite 202
Houston, Texas 77002
(713) 574-1770
(Address, including zip code,
    and telephone number, including area code, of registrant's
    principal executive offices)
Thomas B. Nusz
Chairman, President and Chief Executive Officer
Oasis Petroleum Inc.
1001 Fannin Street, Suite 202
Houston, Texas 77002
(713) 574-1770
(Name, address, including zip
    code, and telephone number, including area code, of agent for
    service)
Copies to:
T. Mark Kelly
David P. Oelman
Vinson & Elkins L.L.P.
1001 Fannin, Suite 2500
Houston, Texas
77002-6760
(713) 758-2222
G. Michael O'Leary
David C. Buck
Andrews Kurth LLP
600 Travis Street, Suite 4200
Houston, TX 77002
(713) 220-4200
Approximate date of commencement of proposed sale to the
    public
: As soon as practicable after the effective date of
    this registration statement.
If any of the securities being registered on this Form are to be
    offered on a delayed or continuous basis pursuant to
    Rule 415 under the Securities Act of 1933 check the
    following
    box:
o
If this Form is filed to register additional securities for an
    offering pursuant to Rule 462(b) under the Securities Act,
    please check the following box and list the Securities Act
    registration statement number of the earlier effective
    registration statement for the same
    offering.
o
If this Form is a post-effective amendment filed pursuant to
    Rule 462(c) under the Securities Act, check the following
    box and list the Securities Act registration statement number of
    the earlier effective registration statement for the same
    offering.
o
If this Form is a post-effective amendment filed pursuant to
    Rule 462(d) under the Securities Act, check the following
    box and list the Securities Act registration statement number of
    the earlier effective registration statement for the same
    offering.
o
Indicate by check mark whether the registrant is a large
    accelerated filer, an accelerated filer, a non-accelerated
    filer, or a smaller reporting company. See the definitions of
    "large accelerated filer," "accelerated
    filer" and "smaller reporting company" in
Rule 12b-2
of the Exchange Act. (Check one):
Large accelerated filer
o
Accelerated filer
o
Non-accelerated filer
þ
Smaller reporting company
o
(Do not check if a smaller reporting company)
CALCULATION
    OF REGISTRATION FEE
Proposed Maximum
Amount of
Title of Each Class of
Aggregate Offering
Registration
Securities to be Registered
Price(1)(2)
Fee
Common Stock, par value $0.001 per share
$
350,000,000
$
24,955
(1)
Includes shares of common stock issuable upon exercise of the
    underwriters' option to purchase additional shares of
    common stock.
(2)
Estimated solely for the purpose of calculating the registration
    fee pursuant to Rule 457(o) under the Securities Act of
    1933.
The registrant hereby amends this registration statement on
    such date or dates as may be necessary to delay its effective
    date until the registrant shall file a further amendment which
    specifically states that this registration statement shall
    thereafter become effective in accordance with Section 8(a)
    of the Securities Act of 1933 or until the registration
    statement shall become effective on such date as the Commission
    acting pursuant to said Section 8(a), may determine.
Table of Contents
The
information in this prospectus is not complete and may be
changed. We and the selling stockholder may not sell these
securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus
is not an offer to sell these securities and we and the selling
stockholder are not soliciting offers to buy these securities in
any state where the offer or sale is not permitted.
(SUBJECT TO COMPLETION, DATED
    MARCH 4, 2010)
PROSPECTUS
Issued               ,
    2010
Shares
Oasis Petroleum Inc.
COMMON STOCK
Oasis Petroleum Inc. is
    offering           shares
    of its common stock and the selling stockholder is
    offering           shares
    of common stock. We will not receive any proceeds from the sale
    of shares by the selling stockholder. This is our initial public
    offering and no public market currently exists for our shares.
    We anticipate that the initial public offering price of our
    common stock will be between $      and
    $      per share.
We intend to apply to list our common stock on the New York
    Stock Exchange under the symbol "OAS".
Investing in our common stock involves risks. See "Risk
    Factors" beginning on page 13.
Price
    $      Per Share
Underwriting
Proceeds to
Price to
Discounts and
Proceeds to
Selling
Public
Commissions
Company
Stockholder
Per Share
$
$
$
$
Total
$
$
$
$
Oasis Petroleum Inc. and the selling stockholder have granted
    the underwriters the right to purchase up to an
    additional           shares
    and           shares,
    respectively, of common stock to cover over-allotments.
The Securities and Exchange Commission and state securities
    regulators have not approved or disapproved of these securities,
    or determined if this prospectus is truthful or complete. Any
    representation to the contrary is a criminal offense.
The underwriters expect to deliver the shares of common stock to
    purchasers
    on          ,
    2010.
Joint Book-Running Managers
Morgan
    Stanley
UBS Investment Bank
Co-Lead Manager
Simmons & Company
    International
,
    2010
TABLE OF
    CONTENTS
Prospectus Summary
1
The Offering
7
Risk Factors
13
Cautionary Note Regarding Forward-Looking
    Statements
33
Use of Proceeds
34
Dividend Policy
34
Capitalization
35
Dilution
36
Selected Historical Consolidated and Unaudited
    Pro Forma Financial Data
37
Management's Discussion and Analysis of
    Financial Condition and Results of Operations
39
Business
58
Management
82
Executive Compensation and Other Information
88
Certain Relationships and Related Party
    Transactions
104
Corporate Reorganization
105
Principal and Selling Stockholders
107
Description of Capital Stock
108
Shares Eligible for Future Sale
112
Material U.S. Federal Income and Estate Tax
    Considerations to Non-U.S. Holders
114
Underwriters
117
Legal Matters
120
Experts
120
Where You Can Find More Information
120
Index to Financial Statements
F-1
Glossary of Oil and Natural Gas Terms
A-1
EX-10.1
EX-23.1
EX-23.2
EX-23.3
EX-99.1
EX-99.2
EX-99.3
You should rely only on the information contained in this
    prospectus and any free writing prospectus prepared by or on
    behalf of us or to which we have referred you. Neither we nor
    the selling stockholder has authorized anyone to provide you
    with information different from that contained in this
    prospectus and any free writing prospectus. We and the selling
    stockholder are offering to sell shares of common stock and
    seeking offers to buy shares of common stock, only in
    jurisdictions where offers and sales are permitted. The
    information in this prospectus is accurate only as of the date
    of this prospectus, regardless of the time of delivery of this
    prospectus or any sale of the common stock.
We have not taken any action to permit a public offering of the
    shares of common stock outside the United States or to permit
    the possession or distribution of this prospectus outside the
    United States. Persons outside the United States who come into
    possession of this prospectus must inform themselves about and
    observe any restrictions relating to the offering of the shares
    of common stock and the distribution of this prospectus outside
    the United States.
Until          ,
    2010, all dealers that buy, sell or trade our common stock,
    whether or not participating in this offering, may be required
    to deliver a prospectus. This requirement is in addition to the
    dealers' obligation to deliver a prospectus when acting as
    underwriters and with respect to their unsold allotments or
    subscriptions.
Industry
    and Market Data
The market data and certain other statistical information used
    throughout this prospectus are based on independent industry
    publications, government publications or other published
    independent sources. Some data is also based on our good faith
    estimates. Although we believe these third-party sources are
    reliable, we have not independently verified the information and
    cannot guarantee its accuracy and completeness.
i
Table of Contents
PROSPECTUS
    SUMMARY
This summary provides a brief overview of information
    contained elsewhere in this prospectus. Because it is
    abbreviated, this summary does not contain all of the
    information that you should consider before investing in our
    common stock. You should read the entire prospectus carefully
    before making an investment decision, including the information
    presented under the headings "Risk Factors,"
    "Cautionary Note Regarding Forward-Looking Statements"
    and "Management's Discussion and Analysis of Financial
    Condition and Results of Operations" and the historical
    consolidated financial statements and unaudited pro forma
    financial information and related notes thereto included
    elsewhere in this prospectus. Unless otherwise indicated,
    information presented in this prospectus assumes that the
    underwriters' option to purchase additional common shares
    is not exercised. We have provided definitions for certain oil
    and natural gas terms used in this prospectus in the
    "Glossary of Oil and Natural Gas Terms" beginning on
page A-1
of this prospectus.
In this prospectus, unless the context otherwise requires,
    the terms "we," "us," "our," and
    the "company" refer to Oasis Petroleum LLC and its
    subsidiaries before the completion of our corporate
    reorganization and Oasis Petroleum Inc. and its subsidiaries as
    of the completion of our corporate reorganization and
    thereafter.
OASIS
    PETROLEUM INC.
Overview
We are an independent exploration and production company focused
    on the acquisition and development of unconventional oil and
    natural gas resources. We have accumulated approximately
    292,000 net leasehold acres in the Williston Basin,
    approximately 85% of which are undeveloped. We are currently
    focused on exploiting what we have identified as significant
    resource potential from the Bakken and Three Forks formations,
    which are present across a substantial majority of our acreage.
    A report issued by the United States Geologic Survey, or USGS,
    in April 2008 classified these formations as the largest
    continuous oil accumulation ever assessed by it in the
    contiguous United States, with approximately 3.65 billion
    barrels of technically recoverable oil resources. We believe the
    location, size and concentration of our acreage creates an
    opportunity for us to achieve cost, recovery and production
    efficiencies through the large-scale development of our project
    inventory. Our management team has a proven track record in
    identifying, acquiring and executing large, repeatable
    development drilling programs, which we refer to as
    "resource conversion" opportunities, and has
    substantial experience in the Williston Basin. We have built our
    leasehold acreage position in the Williston Basin primarily
    through acquisitions in our three primary project areas, West
    Williston, East Nesson and Sanish. For a description of our
    acquisition activity, please see "—Our Acquisition
    History" below.
DeGolyer and MacNaughton, our independent reserve engineers,
    estimated our net proved reserves to be 13.3 MMBoe as of
    December 31, 2009, 42% of which were classified as proved
    developed and 93% of which were comprised of oil. The following
    table presents summary data for each of our primary project
    areas as of December 31, 2009:
2010 Budget
Average
Identified Drilling
Drilling
Estimated Net
Daily
Net
Locations
Gross
Net
Capex
Proved Reserves
Production
Acreage
Gross
Net
Wells
Wells
(In millions)
MMBoe
% Developed
(Boe/d)(1)
Williston Basin
West Williston(2)
159,491
268
106.5
41
18.8
$
110
5.0
55
%
1,106
East Nesson(2)
124,004
113
57.0
13
7.4
47
3.9
36
%
1,016
Sanish(3)
8,747
88
9.6
37
3.8
22
4.3
32
%
792
Total Williston Basin
292,242
469
173.1
91
30.0
$
179
13.2
42
%
2,914
Other
879
—
—
—
—
—
0.1
100
%
159
Total
293,121
469
173.1
91
30.0
$
179
13.3
42
%
3,073
(1)
Represents average daily production for the three months ended
    December 31, 2009.
1
Table of Contents
(2)
Identified gross and net drilling locations in our West
    Williston and East Nesson project areas are primarily comprised
    of Bakken wells based on 1,280-acre spacing and do not include
    any infill wells targeting the Bakken formation or any primary
    or infill wells targeting the Three Forks formation.
(3)
Identified gross and net drilling locations in our Sanish
    project area include a single Bakken infill well per 1,280-acre
    or
640-acre
spacing unit (excluding spacing units already containing two
    Bakken producing wells) and include 10 gross (1.6 net)
    primary wells targeting the Three Forks formation.
In our West Williston and East Nesson project areas, we have an
    inventory of approximately 381 gross primary drilling
    locations (23 of which are proved undeveloped), substantially
    all of which are on 1,280-acre spacing targeting the Bakken
    formation. We plan to aggressively develop these specifically
    identified drilling locations using horizontal drilling and
    multi-stage fracture stimulation techniques. In our Sanish
    project area, we have an additional 88 gross non-operated
    drilling locations (63 of which are proved undeveloped). A
    single additional infill well per spacing unit targeting the
    Bakken formation across all three of our Williston Basin project
    areas would add over 500 incremental potential drilling
    locations. We are also evaluating the resource potential in the
    Three Forks formation across our leasehold position and believe
    there may be a significant number of additional potential
    drilling locations targeting this formation.
Our total 2010 capital expenditure budget is $220 million,
    which consists of:
•
$134 million for drilling and completing operated wells;
•
$45 million for drilling and completing non-operated wells;
•
$15 million for maintaining and expanding our leasehold
    position;
•
$5 million for constructing infrastructure to support
    production in our core project areas; and
•
$21 million in unallocated funds which are available for
    additional drilling and leasing costs and activity.
While we have budgeted $220 million for these purposes, the
    ultimate amount of capital we will expend may fluctuate
    materially based on market conditions and the success of our
    drilling results as the year progresses. Please see
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations — Liquidity and Capital
    Resources."
Our
    Acquisition History
We built our leasehold position in our West Williston, East
    Nesson and Sanish project areas through the following
    acquisitions and development activities:
•
In June 2007, we acquired approximately 175,000 net
    leasehold acres in the Williston Basin with then-current net
    production of approximately 1,000 Boe/d. This acreage is the
    core of our West Williston project area.
•
In May 2008, we entered into a farm-in and purchase arrangement,
    under which we earned or acquired approximately 48,000 net
    leasehold acres, establishing our initial position in the East
    Nesson project area.
•
In June 2009, we acquired approximately 40,000 net
    leasehold acres with then-current net production of
    approximately 800 Boe/d, approximately 83% of which was from the
    Williston Basin. This acquisition consolidated our acreage in
    the East Nesson project area and established our Sanish project
    area.
•
In September 2009, we acquired an additional 46,000 net
    leasehold acres with then-current net production of
    approximately 300 Boe/d. This acquisition further consolidated
    our acreage in the East Nesson project area.
2
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Our
    Business Strategy
Our goal is to increase stockholder value by building reserves,
    production and cash flows at an attractive return on invested
    capital. We seek to achieve our goals through the following
    strategies:
•
Aggressively Develop our Williston Basin Leasehold
    Position.
We intend to aggressively drill and
    develop our acreage position to maximize the value of our
    resource potential. The aggregate 469 gross drilling
    locations that we have specifically identified in the Bakken
    formation in our three project areas will be our primary targets
    in the near term. Our 2010 drilling plan contemplates drilling
    approximately 35 gross (22.4 net) operated wells in these
    project areas by using two operated drilling rigs for the full
    year and adding up to three additional drilling rigs later in
    the year. Subject to market conditions and rig availability, we
    expect to operate five drilling rigs in 2011, which could enable
    us to drill as many as 60 gross operated wells during that
    year. We believe we have the ability to add additional rigs this
    year if market conditions and program results warrant.
•
Enhance Returns by Focusing on Operational and Cost
    Efficiencies.
Our management team is focused on
    continuous improvement of our operating measures and has
    significant experience in successfully converting early-stage
    resource opportunities into cost-efficient development projects.
    We believe the magnitude and concentration of our acreage within
    our project areas provides us with the opportunity to capture
    economies of scale, including the ability to drill multiple
    wells from a single drilling pad, utilizing centralized
    production and fluid handling facilities and reducing the time
    and cost of rig mobilization.
•
Adopt and Employ Leading Drilling and Completion
    Techniques.
Our team is focused on enhancing our
    drilling and completion techniques to maximize recovery. We
    believe these techniques have significantly evolved over the
    last several years, resulting in increased initial production
    rates and recoverable hydrocarbons per well through the
    implementation of techniques such as using longer laterals and
    more tightly spaced fracturing stimulation stages. We
    continuously evaluate our internal drilling results and monitor
    the results of other operators to improve our operating
    practices, and we expect our drilling and completion techniques
    will continue to evolve. This continued evolution may
    significantly enhance our initial production rates, ultimate
    recovery factors and rate of return on invested capital.
•
Pursue Strategic Acquisitions with Significant Resource
    Potential.
In the near term, we intend to
    identify and acquire additional acreage and producing assets in
    the Williston Basin to supplement our existing operations. Going
    forward, we expect to selectively target additional domestic
    basins that would allow us to employ our resource conversion
    strategy on large undeveloped acreage positions similar to what
    we have accumulated in the Williston Basin. While we have no
    current intention to pursue international opportunities, our
    management team has significant international acquisition and
    operating expertise. If we identify an international opportunity
    with appropriate scale, risk and resource conversion potential,
    our board of directors may approve such an investment should
    they determine it is in the long-term best interest of our
    stockholders to do so.
Our
    Competitive Strengths
We have a number of competitive strengths that we believe will
    help us to successfully execute our business strategies:
•
Substantial Leasehold Position in one of North America's
    Leading Unconventional Oil-Resource Plays.
Our
    current leasehold position of approximately 292,000 net
    leasehold acres in the Williston Basin is highly prospective in
    the Bakken formation. We believe our Williston Basin acreage is
    one of the largest concentrated leasehold positions in the
    basin, and much of our acreage is in areas of significant
    drilling activity by other exploration and production companies.
    While we are initially targeting the Bakken formation, we are
    also evaluating what we believe to be significant prospectivity
    in the Three Forks formation which underlies a large portion of
    our acreage. We expect that the scale and
3
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concentration of our acreage will enable us to continue to
    improve our drilling and completion costs and operational
    efficiency.
•
Large, Multi-Year Project Inventory.
We have
    an inventory of approximately 469 gross drilling locations,
    primarily targeting the Bakken formation. We plan to drill
    35 gross (22.4 net) operated wells across our West
    Williston and East Nesson project areas in 2010, the completion
    of which would represent 14% of our 246 gross identified
    operated drilling locations in these two project areas. We may
    be able to enhance the total recovery from the Bakken formation
    by drilling potential infill locations. In addition, our total
    number of drilling locations may also be substantially increased
    by pursuing the prospectivity we have identified in the Three
    Forks formation.
•
Management Team with Proven Acquisition and Operating
    Skills.
Our senior management team has extensive
    expertise in the oil and gas industry as previous members of
    management at Burlington Resources. The senior technical team
    has an average of more than 25 years of industry
    experience, including experience in multiple North American
    resource plays as well as experience in other North American and
    international basins. We believe our management and technical
    team is one of our principal competitive strengths relative to
    our industry peers due to our team's proven track record in
    identification, acquisition and execution of resource conversion
    opportunities. In addition, this team possesses substantial
    expertise in horizontal drilling techniques and managing and
    acquiring large development programs, and also has prior
    experience in the Williston Basin.
•
Incentivized Management Team.
Our management
    team will own a significant direct ownership interest in us
    immediately following the completion of this offering. In
    addition, our management team will own an indirect interest in
    our controlling stockholder, OAS Holding Company LLC, or OAS
    Holdco, which will own      shares
    of our common stock upon completion of this offering. Our
    management team may significantly increase its sharing
    percentage in the shares held by OAS Holdco by increasing the
    return on investment for the other members of OAS Holdco. We
    believe our management team's direct ownership interest
    immediately following the offering as well as their ability to
    increase their interest over time through OAS Holdco provides
    significant incentives to grow the value of our business for the
    benefit of all stockholders. See "Corporate
    Reorganization — LLC Agreement of OAS Holdco."
•
Operating Control over the Majority of our
    Portfolio.
In order to maintain better control
    over our asset portfolio, we have established a leasehold
    position comprised primarily of properties that we expect to
    operate. Controlling operations will allow us to dictate the
    pace of development as well as the costs, type and timing of
    exploration and development activities. We believe that
    maintaining operational control over the majority of our acreage
    will allow us to better pursue our strategies of enhancing
    returns through operational and cost efficiencies and maximizing
    hydrocarbon recovery through continuous improvement of drilling
    and completion techniques.
Recent
    Developments
Drilling Activity.
Since December 31,
    2009, we have drilled four operated wells in the Bakken
    formation, each of which is being completed. Additionally, we
    currently have one operated drilling rig in the West Williston
    project area and another in the East Nesson project area, each
    of which is drilling a well targeting the Bakken formation. Of
    the 16 gross (1.6 net) non-operated wells in progress on
    December 31, 2009, 9 gross (0.7 net) wells have initiated
    production and 7 gross (0.9 net) wells are under completion
    operations. Subsequent to December 31, 2009, an additional 14
    gross (0.9 net) non-operated wells have begun operations and are
    being drilled or completed.
Amended and Restated Credit Facility.
On
    February 26, 2010, we entered into an amended and restated
    revolving credit facility, which will have a borrowing base of
    $70 million upon completion of this offering. Borrowings
    under our revolving credit facility accrue interest at an
    initial rate of 4.0% per annum. Our revolving credit facility
    matures on February 26, 2014. Please see
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations — Liquidity and
    Capital Resources — Reserve-based credit
    facility." As of March 1, 2010, we had
    $13.0 million of indebtedness outstanding under our
    revolving credit
4
Table of Contents
facility. We anticipate that a portion of the net proceeds from
    this offering will be used to repay all of our borrowings
    outstanding as of the closing.
Marketing
    and Transportation
The Williston Basin crude oil transportation and refining
    infrastructure has grown substantially in recent years, largely
    in response to drilling activity in the Bakken formation. As of
    February 15, 2010, there was approximately
    334,600 barrels per day of crude oil transportation and
    refining capacity in the Williston Basin, comprised of
    276,600 barrels per day of pipeline transportation capacity
    and 58,000 barrels per day of refining capacity at the
    Tesoro Corporation Mandan refinery. In addition,
    60,000 barrels per day of specifically dedicated railcar
    transportation capacity has recently been placed into service in
    the Williston Basin. Based on publicly announced expansion
    projects, pipeline transportation capacity for Williston Basin
    oil production could increase by 30,000 to 115,000 barrels
    per day by 2013, and we believe additional projects are under
    consideration. For a discussion of the potential risks to our
    business that could result from transportation and refining
    infrastructure constraints in the Williston Basin, please see
    "Risk Factors — Delays and interruptions of
    production from our wells due to marketing and transportation
    constraints in the Williston Basin could cause significant
    fluctuations in our realized oil and natural gas prices."
Risk
    Factors
Investing in our common stock involves risks that include the
    speculative nature of oil and natural gas exploration,
    competition, volatile oil and natural gas prices and other
    material factors. You should read carefully the section entitled
    "Risk Factors" beginning on page 13 for an
    explanation of these risks before investing in our common stock.
Corporate
    Sponsorship and Structure
We were recently incorporated pursuant to the laws of the State
    of Delaware as Oasis Petroleum Inc. to become a holding company
    for Oasis Petroleum LLC. Oasis Petroleum LLC was formed as a
    Delaware limited liability company on February 26, 2007 by
    certain members of our senior management team and private equity
    funds managed by EnCap Investments L.P., or EnCap. EnCap, which
    was formed in 1988, provides private equity to independent oil
    and gas companies. Since its inception, EnCap has formed
    fourteen oil and gas investment funds with aggregate capital
    commitments of approximately $7.0 billion.
Pursuant to the terms of a corporate reorganization that will be
    completed simultaneously with the closing of this offering, all
    of the interests in Oasis Petroleum LLC will be exchanged for
    common stock of Oasis Petroleum Inc., a recently formed Delaware
    corporation. As a result of the reorganization, Oasis Petroleum
    LLC will become a wholly owned subsidiary of Oasis Petroleum
    Inc. Upon completion of this offering, EnCap and its affiliates
    will initially own a     % indirect
    interest in us through OAS Holdco, the selling stockholder in
    this offering, based on an assumed initial public offering price
    of $      per share. In addition,
    members of our management will initially own an
    aggregate     % interest in us through
    direct ownership of our common stock and through their indirect
    interest in OAS Holdco. For more information on our
    reorganization and the ownership of our common stock by our
    principal and selling stockholders, see "Corporate
    Reorganization" and "Principal and Selling
    Stockholders."
5
Table of Contents
The following diagrams indicate our current ownership structure
    and our ownership structure after giving effect to our
    reorganization and this offering based on an assumed initial
    public offering price of $      per
    share.
Corporate
    Information
Our principal executive offices are located at 1001 Fannin
    Street, Suite 202, Houston, Texas 77002, and our telephone
    number at that address is
(713) 574-1770.
We expect to have an operational website concurrently with the
    completion of this offering. Information on our website or any
    other website is not incorporated by reference herein and does
    not constitute a part of this prospectus.
6
Table of Contents
THE
    OFFERING
Common stock offered by Oasis Petroleum Inc.
shares
    (          shares
    if the underwriters' over-allotment is exercised in full)
Common stock offered by the selling stockholder
shares
    (          shares
    if the underwriters' over-allotment is exercised in full)
Total common stock offered
shares
    (          shares
    if the underwriters' over allotment is exercised in full)
Common stock to be outstanding after the offering
shares
    (          shares
    if the underwriters' over-allotment is exercised in full)
Common stock owned by the selling stockholder after the offering
shares
    (           shares
    if the underwriters' over-allotment is exercised in full)
Over-allotment option
We and the selling stockholder have granted the underwriters a
30-day
option to purchase up to an aggregate
    of          
    additional shares of our common stock to cover over-allotments.
Use of proceeds
We expect to receive approximately
    $      million of net proceeds
    from the sale of the common stock offered by us, based upon the
    assumed initial public offering price of
    $      per share (the midpoint of the
    price range set forth on the cover page of this prospectus),
    after deducting underwriting discounts and estimated offering
    expenses. Each $1.00 increase (decrease) in the public offering
    price would increase (decrease) our net proceeds by
    approximately $      million. We
    intend to use a portion of net proceeds from this offering to
    repay all outstanding indebtedness under our revolving credit
    facility, approximately $13.0 million of which was
    outstanding on March 1, 2010. The remaining proceeds of
    approximately $      million, and
    any proceeds from the exercise of the underwriters' option
    to purchase additional common stock from us, will be used to
    fund exploration, development and other capital expenditures, as
    well as for general corporate purposes. We will not receive any
    proceeds from the sale of shares by the selling stockholder;
    however, EnCap, certain of its affiliates and certain of our
    executive officers will indirectly receive proceeds from such
    sale as a result of a distribution of proceeds by the selling
    stockholder to its members. Affiliates of certain of the
    underwriters are lenders under our revolving credit facility
    and, accordingly, will receive a portion of the proceeds of this
    offering. See "Use of Proceeds" and
    "Underwriters."
Dividend policy
We do not anticipate paying any cash dividends on our common
    stock. In addition, our revolving credit facility prohibits us
    from paying cash dividends. See "Dividend Policy."
Risk factors
You should carefully read and consider the information beginning
    on page 13 of this prospectus set forth under the heading
    "Risk Factors" and all other information set forth in
    this prospectus before deciding to invest in our common stock.
Proposed New York Stock Exchange symbol
OAS
7
Table of Contents
Summary
    Historical Consolidated and Unaudited Pro Forma Financial
    Data
You should read the following summary financial data in
    conjunction with "Selected Historical Consolidated and
    Unaudited Pro Forma Financial Data," "Corporate
    Reorganization," "Management's Discussion and
    Analysis of Financial Condition and Results of Operations"
    and our historical consolidated financial statements and
    unaudited pro forma financial information and related notes
    thereto included elsewhere in this prospectus. The financial
    information included in this prospectus may not be indicative of
    our future results of operations, financial position and cash
    flows.
Set forth below is our summary historical consolidated financial
    data for the period from February 26, 2007, the date of
    inception of Oasis Petroleum LLC, through December 31,
    2007, the years ended December 31, 2008 and 2009 and
    balance sheet data at December 31, 2008 and 2009, all of
    which have been derived from the audited financial statements of
    Oasis Petroleum LLC included elsewhere in this prospectus. The
    balance sheet data at December 31, 2007 has been derived
    from the audited financial statements of Oasis Petroleum LLC not
    included elsewhere in this prospectus. The unaudited pro forma
    financial data for the year ended December 31, 2009, which
    reflects the effects of the acquisition of interests in certain
    oil and gas properties from Kerogen Resources, Inc., is derived
    from the unaudited pro forma financial information included
    elsewhere in this prospectus. The unaudited pro forma financial
    information has been prepared as if the acquisition had taken
    place on January 1, 2009.
Historical
Period from
Pro Forma Year
February 26, 2007
Year Ended
Ended
(Inception) through
December 31,
December 31,
December 31, 2007
2008
2009
2009
(In thousands)
Statement of operations data:
Oil and gas revenues
$
13,791
$
34,736
$
37,755
$
41,999
Expenses:
Lease operating expenses
2,946
7,073
8,691
10,274
Production taxes
1,211
3,001
3,810
4,160
Depreciation, depletion and amortization
4,185
8,686
16,670
19,233
Exploration expenses
1,164
3,222
1,019
1,019
Rig termination(1)
—
—
3,000
3,000
Impairment of oil and gas properties(2)
1,177
47,117
6,233
6,233
Gain on sale of properties
—
—
(1,455
)
(1,455
)
General and administrative expenses
3,181
5,452
9,342
9,342
Total expenses
$
13,864
$
74,551
$
47,310
$
51,806
Operating loss
(73
)
(39,815
)
(9,555
)
(9,807
)
Other income (expense):
Change in unrealized gain (loss) on derivative instruments
(10,679
)
14,769
(7,043
)
(7,043
)
Realized gain (loss) on derivative instruments
(1,062
)
(6,932
)
2,296
2,296
Interest expense
(1,776
)
(2,404
)
(912
)
(912
)
Other income (expense)
40
(9
)
5
5
Total other income (expense)
(13,477
)
5,424
(5,654
)
(5,654
)
Net loss
$
(13,550
)
$
(34,391
)
$
(15,209
)
$
(15,461
)
(1)
For a discussion of our rig termination expenses, see
    Note 10 to our consolidated financial statements.
(2)
In 2008, we recognized a $45.5 million non-cash impairment
    charge on our proved properties to reflect the impact of
    significantly lower oil prices and a $1.6 million
    impairment charge on our unproved properties due to expiring
    leases. See Note 2 to our consolidated financial statements.
8
Table of Contents
As of
December 31,
2009
As Further
As of December 31,
Adjusted(1)
2007
2008
2009
2009
(In thousands)
Balance sheet data:
Cash and cash equivalents
$
6,282
$
1,570
$
40,562
$
Net property, plant and equipment
92,918
114,220
181,573
181,573
Total assets
104,145
129,068
239,553
Long-term debt
46,500
26,000
35,000
Total members' equity
36,350
82,459
171,850
Period from
February 26, 2007
(Inception) through
Year Ended December 31,
December 31, 2007
2008
2009
(In thousands)
Other financial data:
Net cash provided by operating activities
$
2,284
$
13,766
$
6,148
Net cash used in investing activities
(91,988
)
(78,478
)
(80,756
)
Net cash provided by financing activities
95,986
60,000
113,600
Adjusted EBITDA(2)
5,431
12,269
16,668
(1)
Includes the effect of our corporate reorganization and the
    effect of this offering as described in "Corporate
    Reorganization," "Capitalization" and
    "Dilution."
(2)
Adjusted EBITDA is a non-GAAP financial measure. For a
    definition of Adjusted EBITDA and a reconciliation of Adjusted
    EBITDA to our net loss and net cash provided by operating
    activities, see "— Non-GAAP Financial
    Measure" below.
Set forth below is historical financial data for the six months
    ended June 30, 2007 for properties acquired from Bill
    Barrett Corporation, which constitute the accounting predecessor
    to Oasis Petroleum LLC. The historical financial data for the
    six months ended June 30, 2007 have been derived from the
    audited statement of revenues and direct operating expenses for
    the properties acquired from Bill Barrett Corporation included
    elsewhere in this prospectus. Such statement does not reflect
    depreciation, depletion and amortization, general and
    administrative expenses, income taxes or interest expense.
Predecessor
Six Months Ended
June 30, 2007
(In thousands)
Statement of operations data:
Oil and gas revenues
$
10,686
Direct operating expenses
3,490
Excess of revenues over direct operating expenses
$
7,196
Non-GAAP Financial
    Measure
Adjusted EBITDA is a supplemental non-GAAP financial measure
    that is used by management and external users of our
    consolidated financial statements, such as industry analysts,
    investors, lenders and rating agencies.
We define Adjusted EBITDA as earnings before interest expense,
    income taxes, depreciation, depletion and amortization, property
    impairments, exploration expenses and unrealized derivative
    gains and losses.
9
Table of Contents
Adjusted EBITDA is not a measure of net income or cash flows as
    determined by United States generally accepted accounting
    principles, or GAAP.
Management believes Adjusted EBITDA is useful because it allows
    them to more effectively evaluate our operating performance and
    compare the results of our operations from period to period
    without regard to our financing methods or capital structure. We
    exclude the items listed above from net income in arriving at
    Adjusted EBITDA because these amounts can vary substantially
    from company to company within our industry depending upon
    accounting methods and book values of assets, capital structures
    and the method by which the assets were acquired. Adjusted
    EBITDA should not be considered as an alternative to, or more
    meaningful than, net income or cash flows from operating
    activities as determined in accordance with GAAP or as an
    indicator of our operating performance or liquidity. Certain
    items excluded from Adjusted EBITDA are significant components
    in understanding and assessing a company's financial
    performance, such as a company's cost of capital and tax
    structure, as well as the historic costs of depreciable assets,
    none of which are components of Adjusted EBITDA. Our
    computations of Adjusted EBITDA may not be comparable to other
    similarly titled measures of other companies. We believe that
    Adjusted EBITDA is a widely followed measure of operating
    performance and may also be used by investors to measure our
    ability to meet debt service requirements.
The following tables present a reconciliation of the non-GAAP
    financial measure of Adjusted EBITDA to the GAAP financial
    measures of net loss and net cash provided by operating
    activities, respectively.
Period from
February 26, 2007
Year Ended
(Inception) through
December 31,
December 31, 2007
2008
2009
(In thousands)
Adjusted EBITDA reconciliation to Net Loss:
Net loss
$
(13,550
)
$
(34,391
)
$
(15,209
)
Change in unrealized (gain) loss on derivative instruments
10,679
(14,769
)
7,043
Interest expense
1,776
2,404
912
Depreciation, depletion and amortization
4,185
8,686
16,670
Impairment of oil and gas properties
1,177
47,117
6,233
Exploration expenses
1,164
3,222
1,019
Adjusted EBITDA
$
5,431
$
12,269
$
16,668
Period from
February 26, 2007
Year Ended
(Inception) through
December 31,
December 31, 2007
2008
2009
(In thousands)
Adjusted EBITDA reconciliation to Net Cash Provided by
    Operating Activities:
Net cash provided by operating activities
$
2,284
$
13,766
$
6,148
Realized gain (loss) on derivative instruments
(1,062
)
(6,932
)
2,296
Interest expense
1,776
2,404
912
Exploration expenses
1,164
1,942
1,019
Gain on sale of properties
—
—
1,455
Debt discount amortization
(61
)
(107
)
(95
)
Changes in working capital
1,330
1,196
4,933
Adjusted EBITDA
$
5,431
$
12,269
$
16,668
10
Table of Contents
Summary
    Historical Operating and Reserve Data
The following table presents summary data with respect to our
    estimated net proved oil and natural gas reserves as of the
    dates indicated. For additional information regarding our
    reserves, as well as the impact of the SEC's new rules
    governing the presentation of reserve information, see
    "Business." The reserve estimates at December 31,
    2007 and 2008 presented in the table below are based on reports
    prepared by W.D. Von Gonten & Co., independent reserve
    engineers, and were prepared consistent with the former rules
    and regulations of the Securities and Exchange Commission, or
    the SEC, regarding oil and natural gas reserve reporting in
    effect during such periods. The reserve estimates at
    December 31, 2009 presented in the table below are based on
    a report prepared by DeGolyer and MacNaughton, independent
    reserve engineers, and were prepared consistent with the
    SEC's rules regarding oil and natural gas reserve reporting
    that are currently in effect.
At December 31,
2007
2008
2009
Reserve Data(1):
Estimated proved reserves:
Oil (MMBbls)
4.0
2.2
12.4
Natural gas (Bcf)
1.2
0.7
5.3
Total estimated proved reserves (MMBoe)
4.3
2.3
13.3
Proved developed (MMBoe)
3.4
2.3
5.6
Percent developed
81
%
100
%
42
%
Proved undeveloped (MMBoe)
0.8
—
7.7
PV-10
(in
    millions)(2)
$
121.8
$
17.7
$
133.5
Standardized Measure (in millions)(3)
121.8
17.7
133.5
(1)
Our estimated proved reserves and related future net revenues,
PV-10
and
    Standardized Measure were determined using index prices for oil
    and natural gas, without giving effect to derivative
    transactions, and were held constant throughout the life of the
    properties. The index prices were $96.00/Bbl for oil and
    $7.16/MMBtu for natural gas at December 31, 2007, and $44.60/Bbl
    for oil and $5.63/MMBtu for natural gas at December 31, 2008,
    and the unweighted arithmetic average first-day-of-the-month
    prices for the prior 12 months were $61.04/Bbl for oil and
    $3.87/MMBtu for natural gas at December 31, 2009.  These prices
    were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead.
(2)
PV-10
is a
    non-GAAP financial measure and generally differs from
    Standardized Measure, the most directly comparable GAAP
    financial measure, because it does not include the effects of
    income taxes on future net revenues. However, our
PV-10
and
    our Standardized Measure are equivalent because as of
    December 31, 2009, we were a limited liability company not
    subject to entity level taxation. Accordingly, no provision for
    federal or state corporate income taxes has been provided
    because taxable income is passed through to our equity holders.
    However, in connection with the closing of this offering, we
    will merge into a corporation that will become a holding company
    for Oasis Petroleum LLC. As a result, we will be treated as a
    taxable entity for federal income tax purposes. Neither
PV-10
nor
    Standardized Measure represents an estimate of the fair market
    value of our oil and natural gas properties. We and others in
    the industry use
PV-10
as a
    measure to compare the relative size and value of proved
    reserves held by companies without regard to the specific tax
    characteristics of such entities. The
PV-10
amounts included in the reports of W.D. Von Gonten &
    Co. at December 31, 2007 and at December 31, 2008 were
    $122.9 million and $19.2 million, respectively,
    because the
PV-10
amounts included in such reports do not give effect to
    additional estimated plugging and abandonment costs.
(3)
Standardized Measure represents the present value of estimated
    future net cash inflows from proved oil and natural gas
    reserves, less estimated future development, production,
    plugging and abandonment costs and income tax expenses (if
    applicable), discounted at 10% per annum to reflect timing of
    future cash flows. In connection with the closing of this
    offering, we will merge into a corporation that will be treated
    as a taxable entity for federal income tax purposes. Future
    calculations of Standardized Measure will
11
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include the effects of income taxes on future net revenues. For
    further discussion of income taxes, see "Management's
    Discussion and Analysis of Financial Condition and Results of
    Operations."
The following table sets forth summary data with respect to our
    production results, average sales prices and production costs on
    a historical basis for the periods presented:
Oasis Petroleum LLC
Predecessor
Period from
January 1, 2007
February 26, 2007
Year Ended
through
(Inception) through
December 31,
June 30, 2007(1)
December 31, 2007(2)
2008
2009
Operating data:
Net production volumes:
Oil (MBbls)
190
159
379
658
Natural gas (MMcf)
69
73
123
326
Oil equivalents (MBoe)
202
171
400
712
Average daily production (Boe/d)
929
1,092
1,950
Average sales prices:
Oil, without realized derivatives (per Bbl)
$
53.73
$
83.96
$
88.07
$
55.32
Oil, with realized derivatives(3) (per Bbl)
77.27
69.79
58.82
Natural gas (per Mcf)
6.87
6.25
10.91
4.24
Costs and expenses (per Boe of production):
Lease operating expenses
$
12.79
$
17.23
$
17.70
$
12.21
Production taxes
4.49
7.08
7.51
5.35
Depreciation, depletion and amortization
24.47
21.73
23.42
General and administrative expenses
18.60
13.64
13.12
(1)
The historical financial data for the six months ended
    June 30, 2007 have been derived from the audited statement
    of revenues and direct operating expenses for the properties
    acquired from Bill Barrett Corporation included elsewhere in
    this prospectus. Such statement does not reflect depreciation,
    depletion and amortization, general and administrative expenses,
    income taxes or interest expense.
(2)
For the period from February 26, 2007 through June 30,
    2007, we did not engage in oil and gas operating or producing
    activities. Average daily production includes production from
    July 1, 2007 through December 31, 2007.
(3)
Realized prices include realized gains or losses on cash
    settlements for our commodity derivatives, which do not qualify
    for hedge accounting. We have not made any estimates of the
    impact of commodities derivatives on the average sales price for
    our predecessor.
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RISK
    FACTORS
You should carefully consider the risks described below
    before making an investment decision. Our business, financial
    condition or results of operations could be materially adversely
    affected by any of these risks. The trading price of our common
    stock could decline due to any of these risks, and you may lose
    all or part of your investment.
Risks
    Related to the Oil and Natural Gas Industry and Our
    Business
A
    substantial or extended decline in oil and, to a lesser extent,
    natural gas prices may adversely affect our business, financial
    condition or results of operations and our ability to meet our
    capital expenditure obligations and financial
    commitments.
The price we receive for our oil and, to a lesser extent,
    natural gas, heavily influences our revenue, profitability,
    access to capital and future rate of growth. Oil and natural gas
    are commodities and, therefore, their prices are subject to wide
    fluctuations in response to relatively minor changes in supply
    and demand. Historically, the markets for oil and natural gas
    have been volatile. These markets will likely continue to be
    volatile in the future. The prices we receive for our
    production, and the levels of our production, depend on numerous
    factors beyond our control. These factors include the following:
•
worldwide and regional economic conditions impacting the global
    supply and demand for oil and natural gas;
•
the actions of the Organization of Petroleum Exporting
    Countries, or OPEC;
•
the price and quantity of imports of foreign oil and natural gas;
•
political conditions in or affecting other oil-producing and
    natural gas-producing countries, including the current conflicts
    in the Middle East and conditions in South America and Russia;
•
the level of global oil and natural gas exploration and
    production;
•
the level of global oil and natural gas inventories;
•
localized supply and demand fundamentals and transportation
    availability;
•
weather conditions and natural disasters;
•
domestic and foreign governmental regulations;
•
speculation as to the future price of oil and the speculative
    trading of oil and natural gas futures contracts;
•
price and availability of competitors' supplies of oil and
    natural gas;
•
technological advances affecting energy consumption; and
•
the price and availability of alternative fuels.
Substantially all of our production is sold to purchasers under
    short-term (less than
12-month)
contracts at market based prices. Lower oil and natural gas
    prices will reduce our cash flows, borrowing ability and the
    present value of our reserves. See also "— Our
    exploration, development and exploitation projects require
    substantial capital expenditures. We may be unable to obtain
    needed capital or financing on satisfactory terms, which could
    lead to expiration of our leases or a decline in our oil and
    natural gas reserves." Lower oil and natural gas prices may
    also reduce the amount of oil and natural gas that we can
    produce economically and may affect our proved reserves. See
    also "— The present value of future net revenues
    from our proved reserves will not necessarily be the same as the
    current market value of our estimated oil and natural gas
    reserves."
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Drilling
    for and producing oil and natural gas are high risk activities
    with many uncertainties that could adversely affect our
    business, financial condition or results of
    operations.
Our future financial condition and results of operations will
    depend on the success of our exploitation, exploration,
    development and production activities. Our oil and natural gas
    exploration and production activities are subject to numerous
    risks beyond our control, including the risk that drilling will
    not result in commercially viable oil or natural gas production.
    Our decisions to purchase, explore, develop or otherwise exploit
    drilling locations or properties will depend in part on the
    evaluation of data obtained through geophysical and geological
    analyses, production data and engineering studies, the results
    of which are often inconclusive or subject to varying
    interpretations. For a discussion of the uncertainty involved in
    these processes, see "— Our estimated proved
    reserves are based on many assumptions that may turn out to be
    inaccurate. Any significant inaccuracies in these reserve
    estimates or underlying assumptions will materially affect the
    quantities and present value of our reserves." Our cost of
    drilling, completing and operating wells is often uncertain
    before drilling commences. Overruns in budgeted expenditures are
    common risks that can make a particular project uneconomical.
    Further, many factors may curtail, delay or cancel our scheduled
    drilling projects, including the following:
•
shortages of or delays in obtaining equipment and qualified
    personnel;
•
facility or equipment malfunctions;
•
unexpected operational events;
•
pressure or irregularities in geological formations;
•
adverse weather conditions, such as blizzards and ice storms;
•
reductions in oil and natural gas prices;
•
delays imposed by or resulting from compliance with regulatory
    requirements;
•
proximity to and capacity of transportation facilities;
•
title problems; and
•
limitations in the market for oil and natural gas.
Our
    estimated proved reserves are based on many assumptions that may
    turn out to be inaccurate. Any significant inaccuracies in these
    reserve estimates or underlying assumptions will materially
    affect the quantities and present value of our
    reserves.
The process of estimating oil and natural gas reserves is
    complex. It requires interpretations of available technical data
    and many assumptions, including assumptions relating to current
    and future economic conditions and commodity prices. Any
    significant inaccuracies in these interpretations or assumptions
    could materially affect the estimated quantities and present
    value of reserves shown in this prospectus. See
    "Business — Our Operations" for information
    about our estimated oil and natural gas reserves and the
PV-10
and
    Standardized Measure of discounted future net revenues as of
    December 31, 2009.
In order to prepare our estimates, we must project production
    rates and the timing of development expenditures. We must also
    analyze available geological, geophysical, production and
    engineering data. The extent, quality and reliability of this
    data can vary. The process also requires economic assumptions
    about matters such as oil and natural gas prices, drilling and
    operating expenses, capital expenditures, taxes and availability
    of funds. Although the reserve information contained herein is
    reviewed by independent reserve engineers, estimates of oil and
    natural gas reserves are inherently imprecise.
Actual future production, oil and natural gas prices, revenues,
    taxes, development expenditures, operating expenses and
    quantities of recoverable oil and natural gas reserves will vary
    from our estimates. Any significant variance could materially
    affect the estimated quantities and present value of reserves
    shown in this prospectus. In addition, we may adjust estimates
    of proved reserves to reflect production history, results of
    exploration and development, prevailing oil and natural gas
    prices and other factors, many of which are
14
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beyond our control. Due to the limited production history of our
    undeveloped acreage, the estimates of future production
    associated with such properties may be subject to greater
    variance to actual production than would be the case with
    properties having a longer production history.
The
    present value of future net revenues from our proved reserves
    will not necessarily be the same as the current market value of
    our estimated oil and natural gas reserves.
You should not assume that the present value of future net
    revenues from our proved reserves is the current market value of
    our estimated oil and natural gas reserves. For the years ended
    December 31, 2007 and 2008, we based the estimated
    discounted future net revenues from our proved reserves on
    prices and costs in effect on the day of the estimate in
    accordance with previous SEC requirements. In accordance with
    new SEC requirements for the year ended December 31, 2009,
    we have based the estimated discounted future net revenues from
    our proved reserves on the
12-month
unweighted arithmetic average of the
first-day-of-the-month
price for the preceding twelve months without giving effect to
    derivative transactions. Actual future net revenues from our oil
    and natural gas properties will be affected by factors such as:
•
actual prices we receive for oil and natural gas;
•
actual cost of development and production expenditures;
•
the amount and timing of actual production; and
•
changes in governmental regulations or taxation.
The timing of both our production and our incurrence of expenses
    in connection with the development and production of oil and
    natural gas properties will affect the timing and amount of
    actual future net revenues from proved reserves, and thus their
    actual present value. In addition, the 10% discount factor we
    use when calculating discounted future net revenues may not be
    the most appropriate discount factor based on interest rates in
    effect from time to time and risks associated with us or the oil
    and natural gas industry in general.
Actual future prices and costs may differ materially from those
    used in the present value estimates included in this prospectus.
    If oil prices decline by $1.00 per Bbl, then our
PV-10
as of
    December 31, 2009 would decrease approximately
    $4.9 million. If natural gas prices decline by $0.10 per
    Mcf, then our
PV-10
as of
    December 31, 2009 would decrease approximately
    $0.3 million.
Our
    business is difficult to evaluate because we have a limited
    operating history.
In considering whether to invest in our common stock, you should
    consider that there is only limited historical financial and
    operating information available on which to base your evaluation
    of our performance. We were formed in February 2007 and, as a
    result, we have a limited operating history. We face challenges
    and uncertainties in financial planning as a result of the
    unavailability of historical data and uncertainties regarding
    the nature, scope and results of our future activities. New
    companies must develop successful business relationships,
    establish operating procedures, hire staff, install management
    information and other systems, establish facilities and obtain
    licenses, as well as take other measures necessary to conduct
    their intended business activities. We may not be successful in
    implementing our business strategies or in completing the
    development of the infrastructure necessary to conduct our
    business as planned. In the event that our development plan is
    not completed or is delayed, our operating results will be
    adversely affected and our operations will differ materially
    from the activities described in this prospectus. As a result of
    industry factors or factors relating specifically to us, we may
    have to change our methods of conducting business, which may
    cause a material adverse effect on our results of operations and
    financial condition.
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Part
    of our strategy involves drilling in existing or emerging shale
    plays using some of the latest available horizontal drilling and
    completion techniques. The results of our planned exploratory
    drilling in these plays are subject to drilling and completion
    technique risks and drilling results may not meet our
    expectations for reserves or production. As a result, we may
    incur material write-downs and the value of our undeveloped
    acreage could decline if drilling results are
    unsuccessful.
Operations in the Bakken and the Three Forks formations involve
    utilizing the latest drilling and completion techniques as
    developed by ourselves and our service providers in order to
    maximize cumulative recoveries and therefore generate the
    highest possible returns. Risks that we face while drilling
    include, but are not limited to, landing our well bore in the
    desired drilling zone, staying in the desired drilling zone
    while drilling horizontally through the formation, running our
    casing the entire length of the well bore and being able to run
    tools and other equipment consistently through the horizontal
    well bore. Risks that we face while completing our wells
    include, but are not limited to, being able to fracture
    stimulate the planned number of stages, being able to run tools
    the entire length of the well bore during completion operations
    and successfully cleaning out the well bore after completion of
    the final fracture stimulation stage.
Our experience with horizontal drilling in these areas to date
    is limited. Ultimately, the success of these latest drilling and
    completion techniques can only be evaluated over time as more
    wells are drilled and production profiles are established over a
    sufficiently long time period. If our drilling results are less
    than anticipated or we are unable to execute our drilling
    program because of capital constraints, lease expirations,
    access to gathering systems and limited takeaway capacity or
    otherwise,
and/or
natural gas and oil prices decline, the return on our investment
    in these areas may not be as attractive as we anticipate and we
    could incur material write-downs of unevaluated properties and
    the value of our undeveloped acreage could decline in the future.
Our
    exploration, development and exploitation projects require
    substantial capital expenditures. We may be unable to obtain
    needed capital or financing on satisfactory terms, which could
    lead to expiration of our leases or a decline in our oil and
    natural gas reserves.
Our exploration and development activities are capital
    intensive. We make and expect to continue to make substantial
    capital expenditures in our business for the development,
    exploitation, production and acquisition of oil and natural gas
    reserves. Our cash flows used in investing activities were
    $47.4 million related to capital and exploration
    expenditures for the year ended December 31, 2009. Our
    capital expenditure budget for 2010 is approximately
    $220 million, with approximately $179 million
    allocated for drilling and completion operations. To date, our
    capital expenditures have been financed with capital
    contributions from EnCap and other private investors, borrowings
    under our revolving credit facility and net cash provided by
    operating activities. DeGolyer and MacNaughton projects that we
    will incur capital costs in excess of $113 million in the
    next three years to develop the proved undeveloped reserves in
    the Williston Basin covered by its December 31, 2009
    reserve report. Because these costs cover less than 12% of our
    total potential drilling locations, we will be required to
    generate or raise multiples of this amount of capital to develop
    all of our potential drilling locations should we elect to do
    so. The actual amount and timing of our future capital
    expenditures may differ materially from our estimates as a
    result of, among other things, commodity prices, actual drilling
    results, the availability of drilling rigs and other services
    and equipment, and regulatory, technological and competitive
    developments.
A significant improvement in product prices could result in an
    increase in our capital expenditures. We intend to finance our
    future capital expenditures primarily through cash flows
    provided by operating activities, borrowings under our revolving
    credit facility and net proceeds from this offering; however,
    our financing needs may require us to alter or increase our
    capitalization substantially through the issuance of debt or
    additional equity securities or the sale of non-strategic
    assets. The issuance of additional debt may require that a
    portion of our cash flows provided by operating activities be
    used for the payment of principal and interest on our debt,
    thereby reducing our ability to use cash flows to fund working
    capital, capital expenditures and acquisitions. The issuance of
    additional equity securities could have a dilutive effect on the
    value of your common stock.
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Our cash flows provided by operating activities and access to
    capital are subject to a number of variables, including:
•
our proved reserves;
•
the level of oil and natural gas we are able to produce from
    existing wells;
•
the prices at which our oil and natural gas are sold;
•
the costs of developing and producing our oil and natural gas
    production;
•
our ability to acquire, locate and produce new reserves;
•
the ability and willingness of our banks to lend; and
•
our ability to access the equity and debt capital markets.
If the borrowing base under our revolving credit facility or our
    revenues decrease as a result of lower oil or natural gas
    prices, operating difficulties, declines in reserves or for any
    other reason, we may have limited ability to obtain the capital
    necessary to sustain our operations at current levels. If
    additional capital is needed, we may not be able to obtain debt
    or equity financing on terms favorable to us, or at all. If cash
    generated by operations or cash available under our revolving
    credit facility is not sufficient to meet our capital
    requirements, the failure to obtain additional financing could
    result in a curtailment of our operations relating to
    development of our drilling locations, which in turn could lead
    to a possible expiration of our leases and a decline in our oil
    and natural gas reserves, and could adversely affect our
    business, financial condition and results of operations.
If oil
    and natural gas prices decrease, we may be required to take
    write-downs of the carrying values of our oil and natural gas
    properties.
We review our proved oil and natural gas properties for
    impairment whenever events and circumstances indicate that a
    decline in the recoverability of their carrying value may have
    occurred. Based on specific market factors and circumstances at
    the time of prospective impairment reviews, and the continuing
    evaluation of development plans, production data, economics and
    other factors, we may be required to write down the carrying
    value of our oil and natural gas properties, which may result in
    a decrease in the amount available under our revolving credit
    facility. A write-down constitutes a non-cash charge to
    earnings. We may incur impairment charges in the future, which
    could have a material adverse effect on our ability to borrow
    under our revolving credit facility and our results of
    operations for the periods in which such charges are taken.
We
    will not be the operator on all of our drilling locations, and,
    therefore, we will not be able to control the timing of
    exploration or development efforts, associated costs, or the
    rate of production of any
non-operated
assets.
We expect that we will not be the operator on approximately 48%
    of our identified gross drilling locations. As we carry out our
    exploration and development programs, we may enter into
    arrangements with respect to existing or future drilling
    locations that result in a greater proportion of our locations
    being operated by others. As a result, we may have limited
    ability to exercise influence over the operations of the
    drilling locations operated by our partners. Dependence on the
    operator could prevent us from realizing our target returns for
    those locations. The success and timing of exploration and
    development activities operated by our partners will depend on a
    number of factors that will be largely outside of our control,
    including:
•
the timing and amount of capital expenditures;
•
the operator's expertise and financial resources;
•
approval of other participants in drilling wells;
•
selection of technology; and
•
the rate of production of reserves, if any.
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This limited ability to exercise control over the operations of
    some of our drilling locations may cause a material adverse
    effect on our results of operations and financial condition.
Substantially
    all of our producing properties and operations are located in
    the Williston Basin region, making us vulnerable to risks
    associated with operating in one major geographic
    area.
As of December 31, 2009, approximately 99% of our proved
    reserves and approximately 96% of our production were located in
    the Williston Basin in northeastern Montana and northwestern
    North Dakota. As a result, we may be disproportionately exposed
    to the impact of delays or interruptions of production from
    these wells caused by transportation capacity constraints,
    curtailment of production, availability of equipment,
    facilities, personnel or services, significant governmental
    regulation, natural disasters, adverse weather conditions, plant
    closures for scheduled maintenance or interruption of
    transportation of oil or natural gas produced from the wells in
    this area. Due to the concentrated nature of our portfolio of
    properties, a number of our properties could experience any of
    the same conditions at the same time, resulting in a relatively
    greater impact on our results of operations than they might have
    on other companies that have a more diversified portfolio of
    properties. Such delays or interruptions could have a material
    adverse effect on our financial condition and results of
    operations.
Our
    business depends on oil and natural gas gathering and
    transportation facilities, most of which are owned by third
    parties.
The marketability of our oil and natural gas production depends
    in part on the availability, proximity and capacity of gathering
    and pipeline systems owned by third parties. The unavailability
    of, or lack of, available capacity on these systems and
    facilities could result in the shut-in of producing wells or the
    delay, or discontinuance of, development plans for properties.
    See also "— Delays and interruptions of
    production from our wells due to marketing and transportation
    constraints in the Williston Basin could cause significant
    fluctuations in our realized oil and natural gas prices."
    We generally do not purchase firm transportation on third party
    facilities and, therefore, the transportation of our production
    can be interrupted by those having firm arrangements. Federal
    and state regulation of oil and natural gas production and
    transportation, tax and energy policies, changes in supply and
    demand, pipeline pressures, damage to or destruction of
    pipelines and general economic conditions could adversely affect
    our ability to produce, gather and transport our oil and natural
    gas.
The disruption of third-party facilities due to maintenance
and/or
weather could also negatively impact our ability to market and
    deliver our products. We have no control over when or if such
    facilities are restored or what prices will be charged. A total
    shut-in of production could materially affect us due to a lack
    of cash flow, and if a substantial portion of the production is
    hedged at lower than market prices, those financial hedges would
    have to be paid from borrowings absent sufficient cash flow.
Delays
    and interruptions of production from our wells due to marketing
    and transportation constraints in the Williston Basin could
    cause significant fluctuations in our realized oil and natural
    gas prices.
The Williston Basin crude oil marketing and transportation
    environment has historically been characterized by periods when
    oil production has surpassed local transportation and refining
    capacity, resulting in substantial discounts in the price
    received for crude oil versus prices quoted for West Texas
    Intermediate (WTI) crude oil. For example, the difference
    between the WTI crude oil price and the Tesoro North Dakota
    Sweet oil price as of December, 2008 and 2009 was $14.80 per Bbl
    and $10.29 per Bbl, respectively. Such fluctuations and
    discounts could have a material adverse effect on our financial
    condition and results of operations.
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The
    development of our proved undeveloped reserves in the Williston
    Basin and other areas of operation may take longer and may
    require higher levels of capital expenditures than we currently
    anticipate. Therefore, our undeveloped reserves may not be
    ultimately developed or produced.
Approximately 58% of our total proved reserves were classified
    as proved undeveloped as of December 31, 2009. Development
    of these reserves may take longer and require higher levels of
    capital expenditures than we currently anticipate. Delays in the
    development of our reserves or increases in costs to drill and
    develop such reserves will reduce the
PV-10
value
    of our estimated proved undeveloped reserves and future net
    revenues estimated for such reserves and may result in some
    projects becoming uneconomic. In addition, delays in the
    development of reserves could cause us to have to reclassify our
    proved reserves as unproved reserves.
Unless
    we replace our oil and natural gas reserves, our reserves and
    production will decline, which would adversely affect our
    business, financial condition and results of
    operations.
Unless we conduct successful development, exploitation and
    exploration activities or acquire properties containing proved
    reserves, our proved reserves will decline as those reserves are
    produced. Producing oil and natural gas reservoirs generally are
    characterized by declining production rates that vary depending
    upon reservoir characteristics and other factors. Our future oil
    and natural gas reserves and production, and therefore our cash
    flows and income, are highly dependent on our success in
    efficiently developing and exploiting our current reserves and
    economically finding or acquiring additional recoverable
    reserves. We may not be able to develop, exploit, find or
    acquire additional reserves to replace our current and future
    production at acceptable costs. If we are unable to replace our
    current and future production, the value of our reserves will
    decrease, and our business, financial condition and results of
    operations would be adversely affected.
The
    unavailability or high cost of additional drilling rigs,
    equipment, supplies, personnel and oilfield services could
    adversely affect our ability to execute our exploration and
    development plans within our budget and on a timely
    basis.
Shortages or the high cost of drilling rigs, equipment,
    supplies, personnel or oilfield services could delay or
    adversely affect our development and exploration operations or
    cause us to incur significant expenditures that are not provided
    for in our capital budget, which could have a material adverse
    effect on our business, financial condition or results of
    operations.
Market
    conditions or operational impediments may hinder our access to
    oil and natural gas markets or delay our
    production.
Market conditions or the unavailability of satisfactory oil and
    natural gas transportation arrangements may hinder our access to
    oil and natural gas markets or delay our production. The
    availability of a ready market for our oil and natural gas
    production depends on a number of factors, including the demand
    for and supply of oil and natural gas and the proximity of
    reserves to pipelines and terminal facilities. Our ability to
    market our production depends, in substantial part, on the
    availability and capacity of gathering systems, pipelines and
    processing facilities owned and operated by third-parties. Our
    failure to obtain such services on acceptable terms could
    materially harm our business. We may be required to shut in
    wells due to lack of a market or inadequacy or unavailability of
    crude oil or natural gas pipelines or gathering system capacity.
    If our production becomes shut-in for any of these or other
    reasons, we would be unable to realize revenue from those wells
    until other arrangements were made to deliver the products to
    market.
We may
    incur substantial losses and be subject to substantial liability
    claims as a result of our oil and natural gas operations.
    Additionally, we may not be insured for, or our insurance may be
    inadequate to protect us against, these risks.
We are not insured against all risks. Losses and liabilities
    arising from uninsured and underinsured events could materially
    and adversely affect our business, financial condition or
    results of operations. Our oil and
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natural gas exploration and production activities are subject to
    all of the operating risks associated with drilling for and
    producing oil and natural gas, including the possibility of:
•
environmental hazards, such as uncontrollable flows of oil,
    natural gas, brine, well fluids, toxic gas or other pollution
    into the environment, including groundwater and shoreline
    contamination;
•
abnormally pressured formations;
•
mechanical difficulties, such as stuck oilfield drilling and
    service tools and casing collapse;
•
personal injuries and death; and
•
natural disasters.
Any of these risks could adversely affect our ability to conduct
    operations or result in substantial losses to us as a result of:
•
injury or loss of life;
•
damage to and destruction of property, natural resources and
    equipment;
•
pollution and other environmental damage;
•
regulatory investigations and penalties;
•
suspension of our operations; and
•
repair and remediation costs.
We may elect not to obtain insurance if we believe that the cost
    of available insurance is excessive relative to the risks
    presented. In addition, pollution and environmental risks
    generally are not fully insurable. The occurrence of an event
    that is not fully covered by insurance could have a material
    adverse effect on our business, financial condition and results
    of operations.
Drilling
    locations that we decide to drill may not yield oil or natural
    gas in commercially viable quantities.
We describe some of our drilling locations and our plans to
    explore those drilling locations in this prospectus. Our
    drilling locations are in various stages of evaluation, ranging
    from a location which is ready to drill to a location that will
    require substantial additional interpretation. There is no way
    to predict in advance of drilling and testing whether any
    particular location will yield oil or natural gas in sufficient
    quantities to recover drilling or completion costs or to be
    economically viable. The use of technologies and the study of
    producing fields in the same area will not enable us to know
    conclusively prior to drilling whether oil or natural gas will
    be present or, if present, whether oil or natural gas will be
    present in sufficient quantities to be economically viable. Even
    if sufficient amounts of oil or natural gas exist, we may damage
    the potentially productive hydrocarbon bearing formation or
    experience mechanical difficulties while drilling or completing
    the well, resulting in a reduction in production from the well
    or abandonment of the well. If we drill additional wells that we
    identify as dry holes in our current and future drilling
    locations, our drilling success rate may decline and materially
    harm our business. We cannot assure you that the analogies we
    draw from available data from other wells, more fully explored
    locations or producing fields will be applicable to our drilling
    locations. Further, initial production rates reported by us or
    other operators in the Williston Basin may not be indicative of
    future or long-term production rates. In sum, the cost of
    drilling, completing and operating any well is often uncertain,
    and new wells may not be productive.
We
    have incurred losses from operations during certain periods
    since our inception and may continue to do so in the
    future.
We incurred net losses of $15.2 million and
    $34.4 million for the years ended December 31, 2009
    and 2008, respectively, and $13.6 million in the period
    from February 26, 2007 (inception) through
    December 31, 2007. Our development of and participation in
    an increasingly larger number of drilling locations has required
    and will continue to require substantial capital expenditures.
    The uncertainty and risks described in this
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prospectus may impede our ability to economically find, develop,
    exploit and acquire oil and natural gas reserves. As a result,
    we may not be able to achieve or sustain profitability or
    positive cash flows provided by operating activities in the
    future.
Our
    potential drilling location inventories are scheduled over
    several years, making them susceptible to uncertainties that
    could materially alter the occurrence or timing of their
    drilling. In addition, we may not be able to raise the
    substantial amount of capital that would be necessary to drill a
    substantial portion of our potential drilling
    locations.
Our management has identified and scheduled drilling locations
    as an estimation of our future multi-year drilling activities on
    our existing acreage. As of December 31, 2009, only 86 of
    our 469 specifically identified potential future gross drilling
    locations were attributed to proved undeveloped reserves. These
    potential drilling locations, including those without proved
    undeveloped reserves, represent a significant part of our growth
    strategy. Our ability to drill and develop these locations is
    subject to a number of uncertainties, including the availability
    of capital, seasonal conditions, regulatory approvals, oil and
    natural gas prices, costs and drilling results. Because of these
    uncertainties, we do not know if the numerous potential drilling
    locations we have identified will ever be drilled or if we will
    be able to produce oil or natural gas from these or any other
    potential drilling locations. Pursuant to a new SEC rule and
    guidance, subject to limited exceptions, proved undeveloped
    reserves may only be booked if they relate to wells scheduled to
    be drilled within five years of the date of booking. This new
    rule and guidance may limit our potential to book additional
    proved undeveloped reserves as we pursue our drilling program.
Our
    acreage must be drilled before lease expiration, generally
    within three to five years, in order to hold the acreage by
    production. In the highly competitive market for acreage,
    failure to drill sufficient wells in order to hold acreage will
    result in a substantial lease renewal cost, or if renewal is not
    feasible, loss of our lease and prospective drilling
    opportunities.
Unless production is established within the spacing units
    covering the undeveloped acres on which some of the locations
    are identified, the leases for such acreage will expire. As of
    December 31, 2009, we had leases representing
    45,640 net acres expiring in 2010, 59,559 net acres
    expiring in 2011, and 31,642 net acres expiring in 2012.
    The cost to renew such leases may increase significantly, and we
    may not be able to renew such leases on commercially reasonable
    terms or at all. In addition, on certain portions of our
    acreage, third-party leases become immediately effective if our
    leases expire. As such, our actual drilling activities may
    materially differ from our current expectations, which could
    adversely affect our business.
Our
    operations are subject to environmental and operational safety
    laws and regulations that may expose us to significant costs and
    liabilities.
Our oil and natural gas exploration and production operations
    are subject to stringent and complex federal, state and local
    laws and regulations governing health and safety aspects of our
    operations, the discharge of materials into the environment or
    otherwise relating to environmental protection. These laws and
    regulations may impose numerous obligations that are applicable
    to our operations including the acquisition of a permit before
    conducting drilling or underground injection activities; the
    restriction of types, quantities and concentration of materials
    that can be released into the environment; the limitation or
    prohibition of drilling activities on certain lands lying within
    wilderness, wetlands and other protected areas; the application
    of specific health and safety criteria addressing worker
    protection; and the imposition of substantial liabilities for
    pollution resulting from operations. Numerous governmental
    authorities, such as the U.S. Environmental Protection
    Agency, or the EPA, and analogous state agencies have the power
    to enforce compliance with these laws and regulations and the
    permits issued under them, oftentimes requiring difficult and
    costly actions. Failure to comply with these laws and
    regulations may result in the assessment of administrative,
    civil or criminal penalties; the imposition of investigatory or
    remedial obligations; and the issuance of injunctions limiting
    or preventing some or all of our operations.
There is inherent risk of incurring significant environmental
    costs and liabilities in the performance of our operations due
    to our handling of petroleum hydrocarbons and wastes, because of
    air emissions and waste
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water discharges related to our operations, and as a result of
    historical industry operations and waste disposal practices.
    Under certain environmental laws and regulations, we could be
    subject to joint and several, strict liability for the removal
    or remediation of previously released materials or property
    contamination regardless of whether we were responsible for the
    release or contamination or if the operations were not in
    compliance with all applicable laws at the time those actions
    were taken. Private parties, including the owners of properties
    upon which our wells are drilled and facilities where our
    petroleum hydrocarbons or wastes are taken for reclamation or
    disposal, may also have the right to pursue legal actions to
    enforce compliance as well as to seek damages for non-compliance
    with environmental laws and regulations or for personal injury
    or property damage. In addition, the risk of accidental spills
    or releases could expose us to significant liabilities that
    could have a material adverse effect on our financial condition
    or results of operations. Changes in environmental laws and
    regulations occur frequently, and any changes that result in
    more stringent or costly waste handling, storage, transport,
    disposal or cleanup requirements could require us to make
    significant expenditures to attain and maintain compliance and
    may otherwise have a material adverse effect on our own results
    of operations, competitive position or financial condition. We
    may not be able to recover some or any of these costs from
    insurance.
Climate
    change laws and regulations restricting emissions of
    "greenhouse gases" could result in increased operating
    costs and reduced demand for the oil and natural gas that we
    produce while the physical effects of climate change could
    disrupt our production and cause us to incur significant costs
    in preparing for or responding to those effects.
On December 15, 2009, the EPA published its findings that
    emissions of carbon dioxide, methane and other "greenhouse
    gases" present an endangerment to human health and the
    environment because emissions of such gases are, according to
    the EPA, contributing to warming of the earth's atmosphere
    and other climatic changes. These findings by the EPA allow the
    agency to proceed with the adoption and implementation of
    regulations that would restrict emissions of greenhouse gases
    under existing provisions of the federal Clean Air Act.
    Consequently, the EPA proposed two sets of regulations that
    would require a reduction in emissions of greenhouse gases from
    motor vehicles and, also, could trigger permit review for
    greenhouse gas emissions from certain stationary sources. In
    addition, on October 30, 2009, the EPA published a final
    rule requiring the reporting of greenhouse gas emissions from
    specified large greenhouse gas emission sources in the United
    States beginning in 2011 for emissions occurring in 2010. The
    adoption and implementation of any regulations imposing
    reporting obligations on, or limiting emissions of greenhouse
    gases from, our equipment and operations could require us to
    incur costs to reduce emissions of greenhouse gases associated
    with our operations or could adversely affect demand for the oil
    and natural gas we produce.
Also, on June 26, 2009, the U.S. House of
    Representatives passed the American Clean Energy and Security
    Act of 2009, or ACESA, which would establish an economy-wide
cap-and-trade
program to reduce U.S. emissions of greenhouse gases
    including carbon dioxide and methane that may contribute to
    warming of the Earth's atmosphere and other climatic
    changes. ACESA would require a 17 percent reduction in
    greenhouse gas emissions from 2005 levels by 2020 and just over
    an 80 percent reduction of such emissions by 2050. Under
    this legislation, the EPA would issue a capped and steadily
    declining number of tradable emissions allowances to certain
    major sources of greenhouse gas emissions so that such sources
    could continue to emit greenhouse gases into the atmosphere.
    These allowances would be expected to escalate significantly in
    cost over time. The net effect of ACESA will be to impose
    increasing costs on the combustion of carbon-based fuels such as
    oil, refined petroleum products and natural gas. The
    U.S. Senate has begun work on its own legislation for
    restricting domestic greenhouse gas emissions and President
    Obama has indicated his support of legislation to reduce
    greenhouse gas emissions through an emission allowance system.
    Although it is not possible at this time to predict when the
    Senate may act on climate change legislation or how any bill
    passed by the Senate would be reconciled with ACESA, any future
    federal laws or implementing regulations that may be adopted to
    address greenhouse gas emissions could require us to incur
    increased operating costs and could adversely affect demand for
    the oil and natural gas we produce.
Finally, it should be noted that some scientists have concluded
    that increasing concentrations of greenhouse gases in the
    Earth's atmosphere may produce climate changes that have
    significant physical
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effects, such as increased frequency and severity of storms,
    floods and other climatic events. If any such effects were to
    occur, they could have an adverse effect on our exploration and
    production operations. Significant physical effects of climate
    change could also have an indirect affect on our financing and
    operations by disrupting the transportation or process-related
    services provided by midstream companies, service companies or
    suppliers with whom we have a business relationship. We may not
    be able to recover through insurance some or any of the damages,
    losses, or costs that may result from potential physical effects
    of climate change.
Federal
    and state legislative and regulatory initiatives relating to
    hydraulic fracturing could result in increased costs and
    additional operating restrictions or delays.
The U.S. Congress is considering legislation to amend the
    federal Safe Drinking Water Act to require the disclosure of
    chemicals used by the oil and natural gas industry in the
    hydraulic fracturing process. Hydraulic fracturing is an
    important and commonly used process in the completion of
    unconventional oil and natural gas wells in shale and tight sand
    formations. This process involves the injection of water, sand
    and chemicals under pressure into rock formations to stimulate
    oil and natural gas production. Sponsors of these bills, which
    are currently pending in the Energy and Commerce Committee and
    the Environmental and Public Works Committee of the House of
    Representatives and Senate, respectively, have asserted that
    chemicals used in the fracturing process could adversely affect
    drinking water supplies. The proposed legislation would require
    the reporting and public disclosure of chemicals used in the
    fracturing process, which could make it easier for third parties
    opposing the hydraulic fracturing process to initiate legal
    proceedings based on allegations that specific chemicals used in
    the fracturing process could adversely affect groundwater. In
    addition, these bills, if adopted, could establish an additional
    level of regulation at the federal level that could lead to
    operational delays or increased operating costs and could result
    in additional regulatory burdens that could make it more
    difficult to perform hydraulic fracturing and increase our costs
    of compliance and doing business.
Competition
    in the oil and natural gas industry is intense, making it more
    difficult for us to acquire properties, market oil and natural
    gas and secure trained personnel.
Our ability to acquire additional drilling locations and to find
    and develop reserves in the future will depend on our ability to
    evaluate and select suitable properties and to consummate
    transactions in a highly competitive environment for acquiring
    properties, marketing oil and natural gas and securing equipment
    and trained personnel. Also, there is substantial competition
    for capital available for investment in the oil and natural gas
    industry. Many of our competitors possess and employ financial,
    technical and personnel resources substantially greater than
    ours. Those companies may be able to pay more for productive oil
    and natural gas properties and exploratory drilling locations or
    to identify, evaluate, bid for and purchase a greater number of
    properties and locations than our financial or personnel
    resources permit. Furthermore, these companies may also be
    better able to withstand the financial pressures of unsuccessful
    drilling attempts, sustained periods of volatility in financial
    markets and generally adverse global and industry-wide economic
    conditions, and may be better able to absorb the burdens
    resulting from changes in relevant laws and regulations, which
    would adversely affect our competitive position. In addition,
    companies may be able to offer better compensation packages to
    attract and retain qualified personnel than we are able to
    offer. The cost to attract and retain qualified personnel has
    increased over the past few years due to competition and may
    increase substantially in the future. We may not be able to
    compete successfully in the future in acquiring prospective
    reserves, developing reserves, marketing hydrocarbons,
    attracting and retaining quality personnel and raising
    additional capital, which could have a material adverse effect
    on our business.
The
    loss of senior management or technical personnel could adversely
    affect our operations.
To a large extent, we depend on the services of our senior
    management and technical personnel. The loss of the services of
    our senior management or technical personnel, including Thomas
    B. Nusz, our Chairman, President and Chief Executive Officer,
    and Taylor L. Reid, our Executive Vice President and Chief
    Operating Officer, could have a material adverse effect on our
    operations. We do not maintain, nor do we plan to obtain, any
    insurance against the loss of any of these individuals.
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Seasonal
    weather conditions adversely affect our ability to conduct
    drilling activities in some of the areas where we
    operate.
Oil and natural gas operations in the Williston Basin are
    adversely affected by seasonal weather conditions. In the
    Williston Basin, drilling and other oil and natural gas
    activities cannot be conducted as effectively during the winter
    months. Severe winter weather conditions limit and may
    temporarily halt our ability to operate during such conditions.
    These constraints and the resulting shortages or high costs
    could delay or temporarily halt our operations and materially
    increase our operating and capital costs.
Our
    derivative activities could result in financial losses or could
    reduce our income.
To achieve more predictable cash flows and to reduce our
    exposure to adverse fluctuations in the prices of oil and
    natural gas, we currently, and may in the future, enter into
    derivative arrangements for a portion of our oil and natural gas
    production, including collars and fixed-price swaps. We have not
    designated any of our derivative instruments as hedges for
    accounting purposes and record all derivative instruments on our
    balance sheet at fair value. Changes in the fair value of our
    derivative instruments are recognized in earnings. Accordingly,
    our earnings may fluctuate significantly as a result of changes
    in the fair value of our derivative instruments.
Derivative arrangements also expose us to the risk of financial
    loss in some circumstances, including when:
•
production is less than the volume covered by the derivative
    instruments;
•
the counter-party to the derivative instrument defaults on its
    contract obligations; or
•
there is an increase in the differential between the underlying
    price in the derivative instrument and actual prices received.
In addition, these types of derivative arrangements limit the
    benefit we would receive from increases in the prices for oil
    and natural gas and may expose us to cash margin requirements.
The
    adoption of derivatives legislation by Congress could have an
    adverse impact on our ability to hedge risks associated with our
    business.
We enter into derivative contracts in order to hedge a portion
    of our oil production. Congress is currently considering
    legislation to impose restrictions on certain transactions
    involving derivatives, which could affect the use of derivatives
    in hedging transactions. ACESA contains provisions that would
    prohibit private energy commodity derivative and hedging
    transactions. ACESA would expand the power of the Commodity
    Futures Trading Commission, or the CFTC, to regulate derivative
    transactions related to energy commodities, including oil and
    natural gas, and to mandate clearance of such derivative
    contracts through registered derivative clearing organizations.
    Under ACESA, the CFTC's expanded authority over energy
    derivatives would terminate upon the adoption of general
    legislation covering derivative regulatory reform. The CFTC is
    considering whether to set limits on trading and positions in
    commodities with finite supply, particularly energy commodities,
    such as crude oil, natural gas and other energy products. The
    CFTC also is evaluating whether position limits should be
    applied consistently across all markets and participants.
    Separately, two committees of the House of Representatives, the
    Financial Services and Agriculture Committees, acted on
    October 15, 2009 and October 21, 2009, respectively,
    to adopt legislation that would impose comprehensive regulation
    on the
over-the-counter
(OTC) derivatives marketplace. This legislation would subject
    swap dealers and major swap participants to substantial
    supervision and regulation, including capital standards, margin
    requirements, business conduct standards, and recordkeeping and
    reporting requirements. It also would require central clearing
    for transactions entered into between swap dealers or major swap
    participants, and would provide the CFTC with authority to
    impose position limits in the OTC derivatives markets. A major
    swap participant generally would be someone other than a dealer
    who maintains a "substantial" position in outstanding
    swaps other than swaps used for commercial hedging, or whose
    positions create substantial exposure to its counterparties or
    the system. Although it is not possible at this time to predict
    whether or when Congress may act on derivatives legislation or
    how any climate change bill approved by the Senate would be
    reconciled with
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ACESA, any laws or regulations that may be adopted that subject
    us to additional capital or margin requirements relating to, or
    to additional restrictions on, our trading and commodity
    positions could have an adverse effect on our ability to hedge
    risks associated with our business or on the cost of our hedging
    activity.
Increased
    costs of capital could adversely affect our
    business.
Our business and operating results can be harmed by factors such
    as the availability, terms and cost of capital, increases in
    interest rates or a reduction in credit rating. Changes in any
    one or more of these factors could cause our cost of doing
    business to increase, limit our access to capital, limit our
    ability to pursue acquisition opportunities, reduce our cash
    flows available for drilling and place us at a competitive
    disadvantage. Recent and continuing disruptions and volatility
    in the global financial markets may lead to an increase in
    interest rates or a contraction in credit availability impacting
    our ability to finance our operations. We require continued
    access to capital. A significant reduction in the availability
    of credit could materially and adversely affect our ability to
    achieve our planned growth and operating results.
Our
    revolving credit facility contains certain covenants that may
    inhibit our ability to make certain investments, incur
    additional indebtedness and engage in certain other
    transactions, which could adversely affect our ability to meet
    our future goals.
Our revolving credit facility includes certain covenants that,
    among other things, restrict:
•
our investments, loans and advances and the payment of dividends
    and other restricted payments;
•
our incurrence of additional indebtedness;
•
the granting of liens, other than liens created pursuant to the
    revolving credit facility and certain permitted liens;
•
mergers, consolidations and sales of all or a substantial part
    of our business or properties;
•
the hedging, forward sale or swap of our production of crude oil
    or natural gas or other commodities;
•
the sale of assets (other than production sold in the ordinary
    course of business); and
•
our capital expenditures.
Our revolving credit facility requires us to maintain certain
    financial ratios, such as leverage ratios. All of these
    restrictive covenants may restrict our ability to expand or
    pursue our business strategies. Our ability to comply with these
    and other provisions of our revolving credit facility may be
    impacted by changes in economic or business conditions, results
    of operations or events beyond our control. The breach of any of
    these covenants could result in a default under our revolving
    credit facility, in which case, depending on the actions taken
    by the lenders thereunder or their successors or assignees, such
    lenders could elect to declare all amounts borrowed under our
    revolving credit facility, together with accrued interest, to be
    due and payable. If we were unable to repay such borrowings or
    interest, our lenders could proceed against their collateral. If
    the indebtedness under our revolving credit facility were to be
    accelerated, our assets may not be sufficient to repay in full
    such indebtedness.
Our
    level of indebtedness may increase and reduce our financial
    flexibility.
Upon the completion of this offering, we expect to have no
    indebtedness outstanding and will have a borrowing capacity of
    $70 million under our revolving credit facility. In the
    future, we may incur significant indebtedness in order to make
    future acquisitions or to develop our properties.
Our level of indebtedness could affect our operations in several
    ways, including the following:
•
a significant portion of our cash flows could be used to service
    our indebtedness;
•
a high level of debt would increase our vulnerability to general
    adverse economic and industry conditions;
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•
the covenants contained in the agreements governing our
    outstanding indebtedness will limit our ability to borrow
    additional funds, dispose of assets, pay dividends and make
    certain investments;
•
a high level of debt may place us at a competitive disadvantage
    compared to our competitors that are less leveraged and
    therefore, may be able to take advantage of opportunities that
    our indebtedness would prevent us from pursuing;
•
our debt covenants may also affect our flexibility in planning
    for, and reacting to, changes in the economy and in our industry;
•
a high level of debt may make it more likely that a reduction in
    our borrowing base following a periodic redetermination could
    require us to repay a portion of our then-outstanding bank
    borrowings; and
•
a high level of debt may impair our ability to obtain additional
    financing in the future for working capital, capital
    expenditures, acquisitions, general corporate or other purposes.
A high level of indebtedness increases the risk that we may
    default on our debt obligations. Our ability to meet our debt
    obligations and to reduce our level of indebtedness depends on
    our future performance. General economic conditions, oil and
    natural gas prices and financial, business and other factors
    affect our operations and our future performance. Many of these
    factors are beyond our control. We may not be able to generate
    sufficient cash flows to pay the interest on our debt and future
    working capital, borrowings or equity financing may not be
    available to pay or refinance such debt. Factors that will
    affect our ability to raise cash through an offering of our
    capital stock or a refinancing of our debt include financial
    market conditions, the value of our assets and our performance
    at the time we need capital.
In addition, our bank borrowing base is subject to periodic
    redeterminations. We could be forced to repay a portion of our
    bank borrowings due to redeterminations of our borrowing base.
    If we are forced to do so, we may not have sufficient funds to
    make such repayments. If we do not have sufficient funds and are
    otherwise unable to negotiate renewals of our borrowings or
    arrange new financing, we may have to sell significant assets.
    Any such sale could have a material adverse effect on our
    business and financial results.
The
    inability of one or more of our customers to meet their
    obligations to us may adversely affect our financial
    results.
Our principal exposures to credit risk are through receivables
    resulting from the sale of our oil and natural gas production
    ($9.1 million in receivables at December 31, 2009),
    which we market to energy marketing companies, refineries and
    affiliates, advances to joint interest parties
    ($4.6 million at December 31, 2009), joint interest
    receivables ($1.3 million at December 31, 2009), and
    commodity derivatives contracts ($0.2 million at
    December 31, 2009).
We are subject to credit risk due to the concentration of our
    oil and natural gas receivables with several significant
    customers. This concentration of customers may impact our
    overall credit risk since these entities may be similarly
    affected by changes in economic and other conditions. For the
    year ended December 31, 2008, sales to Tesoro Refining and
    Marketing Company and Texon L.P. accounted for approximately 57%
    and 14%, respectively, of our total sales. For the year ended
    December 31, 2009, sales to Tesoro Refining and Marketing
    Company and Texon L.P. accounted for approximately 32% and 30%,
    respectively, of our total sales. We do not require our
    customers to post collateral. The inability or failure of our
    significant customers to meet their obligations to us or their
    insolvency or liquidation may adversely affect our financial
    results.
Joint interest receivables arise from billing entities who own a
    partial interest in the wells we operate. These entities
    participate in our wells primarily based on their ownership in
    leases on which we wish to drill. We have limited ability to
    control participation in our wells. In addition, our oil and
    natural gas derivative arrangements expose us to credit risk in
    the event of nonperformance by counterparties.
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We may
    be subject to risks in connection with acquisitions and the
    integration of significant acquisitions may be
    difficult.
We periodically evaluate acquisitions of reserves, properties,
    prospects and leaseholds and other strategic transactions that
    appear to fit within our overall business strategy. The
    successful acquisition of producing properties requires an
    assessment of several factors, including:
•
recoverable reserves;
•
future oil and natural gas prices and their appropriate
    differentials;
•
development and operating costs; and
•
potential environmental and other liabilities.
The accuracy of these assessments is inherently uncertain. In
    connection with these assessments, we perform a review of the
    subject properties that we believe to be generally consistent
    with industry practices. Our review will not reveal all existing
    or potential problems nor will it permit us to become
    sufficiently familiar with the properties to fully assess their
    deficiencies and potential recoverable reserves. Inspections may
    not always be performed on every well, and environmental
    problems are not necessarily observable even when an inspection
    is undertaken. Even when problems are identified, the seller may
    be unwilling or unable to provide effective contractual
    protection against all or part of the problems. We often are not
    entitled to contractual indemnification for environmental
    liabilities and acquire properties on an "as is" basis.
Significant acquisitions and other strategic transactions may
    involve other risks, including:
•
diversion of our management's attention to evaluating,
    negotiating and integrating significant acquisitions and
    strategic transactions;
•
challenge and cost of integrating acquired operations,
    information management and other technology systems and business
    cultures with those of ours while carrying on our ongoing
    business;
•
difficulty associated with coordinating geographically separate
    organizations; and
•
challenge of attracting and retaining personnel associated with
    acquired operations.
The process of integrating operations could cause an
    interruption of, or loss of momentum in, the activities of our
    business. Members of our senior management may be required to
    devote considerable amounts of time to this integration process,
    which will decrease the time they will have to manage our
    business. If our senior management is not able to effectively
    manage the integration process, or if any significant business
    activities are interrupted as a result of the integration
    process, our business could suffer.
If we
    fail to realize the anticipated benefits of a significant
    acquisition, our results of operations may be lower than we
    expect.
The success of a significant acquisition will depend, in part,
    on our ability to realize anticipated growth opportunities from
    combining the acquired assets or operations with those of ours.
    Even if a combination is successful, it may not be possible to
    realize the full benefits we may expect in estimated proved
    reserves, production volume, cost savings from operating
    synergies or other benefits anticipated from an acquisition or
    realize these benefits within the expected time frame.
    Anticipated benefits of an acquisition may be offset by
    operating losses relating to changes in commodity prices, or in
    oil and natural gas industry conditions, or by risks and
    uncertainties relating to the exploratory prospects of the
    combined assets or operations, or an increase in operating or
    other costs or other difficulties. If we fail to realize the
    benefits we anticipate from an acquisition, our results of
    operations may be adversely affected.
We may
    incur losses as a result of title defects in the properties in
    which we invest.
It is our practice in acquiring oil and gas leases or interests
    not to incur the expense of retaining lawyers to examine the
    title to the mineral interest. Rather, we rely upon the judgment
    of oil and gas lease brokers or
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landmen who perform the fieldwork in examining records in the
    appropriate governmental office before attempting to acquire a
    lease in a specific mineral interest.
Prior to the drilling of an oil or gas well, however, it is the
    normal practice in our industry for the person or company acting
    as the operator of the well to obtain a preliminary title review
    to ensure there are no obvious defects in title to the well.
    Frequently, as a result of such examinations, certain curative
    work must be done to correct defects in the marketability of the
    title, and such curative work entails expense. Our failure to
    cure any title defects may adversely impact our ability in the
    future to increase production and reserves. There is no
    assurance that we will not suffer a monetary loss from title
    defects or title failure. Additionally, undeveloped acreage has
    greater risk of title defects than developed acreage. If there
    are any title defects or defects in assignment of leasehold
    rights in properties in which we hold an interest, we will
    suffer a financial loss.
Risks
    Relating to the Offering and our Common Stock
The
    initial public offering price of our common stock may not be
    indicative of the market price of our common stock after this
    offering. In addition, an active liquid trading market for our
    common stock may not develop and our stock price may be
    volatile.
Prior to this offering, our common stock was not traded on any
    market. An active and liquid trading market for our common stock
    may not develop or be maintained after this offering. Liquid and
    active trading markets usually result in less price volatility
    and more efficiency in carrying out investors' purchase and
    sale orders. The market price of our common stock could vary
    significantly as a result of a number of factors, some of which
    are beyond our control. In the event of a drop in the market
    price of our common stock, you could lose a substantial part or
    all of your investment in our common stock. The initial public
    offering price will be negotiated between us, the selling
    stockholder and representatives of the underwriters, based on
    numerous factors which we discuss in the
    "Underwriters" section of this prospectus, and may not
    be indicative of the market price of our common stock after this
    offering. Consequently, you may not be able to sell shares of
    our common stock at prices equal to or greater than the price
    paid by you in the offering.
The following factors could affect our stock price:
•
our operating and financial performance and drilling locations,
    including reserve estimates;
•
quarterly variations in the rate of growth of our financial
    indicators, such as net income per share, net income and
    revenues;
•
changes in revenue or earnings estimates or publication of
    reports by equity research analysts;
•
speculation in the press or investment community;
•
sales of our common stock by us, the selling stockholder or
    other stockholders, or the perception that such sales may occur;
•
general market conditions, including fluctuations in commodity
    prices; and
•
domestic and international economic, legal and regulatory
    factors unrelated to our performance.
The stock markets in general have experienced extreme volatility
    that has often been unrelated to the operating performance of
    particular companies. These broad market fluctuations may
    adversely affect the trading price of our common stock.
Purchasers
    of common stock in this offering will experience immediate and
    substantial dilution of $      per
    share.
Based on an assumed initial public offering price of
    $      per share, purchasers of our
    common stock in this offering will experience an immediate and
    substantial dilution of $      per
    share in the pro forma as adjusted net tangible book value per
    share of common stock from the initial public offering price,
    and our pro forma as adjusted net tangible book value as of
    December 31, 2009 after giving effect to this offering
    would be $      per share. See
    "Dilution" for a complete description of the
    calculation of net tangible book value.
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Because
    we are a relatively small company, the requirements of being a
    public company, including compliance with the reporting
    requirements of the Exchange Act and the requirements of the
Sarbanes-Oxley
Act, may strain our resources, increase our costs and distract
    management; and we may be unable to comply with these
    requirements in a timely or cost-effective manner.
As a public company with listed equity securities, we will need
    to comply with new laws, regulations and requirements, certain
    corporate governance provisions of the Sarbanes-Oxley Act of
    2002, related regulations of the SEC and the requirements of the
    New York Stock Exchange, or the NYSE, with which we are not
    required to comply as a private company. Complying with these
    statutes, regulations and requirements will occupy a significant
    amount of time of our board of directors and management and will
    significantly increase our costs and expenses. We will
    need to:
•
institute a more comprehensive compliance function;
•
design, establish, evaluate and maintain a system of internal
    controls over financial reporting in compliance with the
    requirements of Section 404 of the Sarbanes-Oxley Act of
    2002 and the related rules and regulations of the SEC and the
    Public Company Accounting Oversight Board;
•
comply with rules promulgated by the NYSE;
•
prepare and distribute periodic public reports in compliance
    with our obligations under the federal securities laws;
•
establish new internal policies, such as those relating to
    disclosure controls and procedures and insider trading;
•
involve and retain to a greater degree outside counsel and
    accountants in the above activities; and
•
establish an investor relations function.
In addition, we also expect that being a public company subject
    to these rules and regulations will require us to accept less
    director and officer liability insurance coverage than we desire
    or to incur substantial costs to obtain coverage. These factors
    could also make it more difficult for us to attract and retain
    qualified members of our board of directors, particularly to
    serve on our audit committee, and qualified executive officers.
In
    connection with past audits of our financial statements, our
    independent registered public accounting firm identified and
    reported audit adjustments to management. Certain audit
    adjustments were deemed to be the result of internal control
    deficiencies that constitute material weaknesses in our internal
    control over financial reporting. If one or more material
    weaknesses persist or if we fail to establish and maintain
    effective internal control over financial reporting, our ability
    to accurately report our financial results could be adversely
    affected.
Prior to the completion of this offering, we have been a private
    company with limited accounting personnel to adequately execute
    our accounting processes and other supervisory resources with
    which to address our internal control over financial reporting.
    As such, we have not maintained an effective control environment
    in that the design and execution of our controls has not
    consistently resulted in effective review and supervision by
    individuals with financial reporting oversight roles. The lack
    of adequate staffing levels resulted in insufficient time spent
    on review and approval of certain information used to prepare
    our financial statements. We have concluded that these control
    deficiencies constitute a material weakness in our control
    environment. A material weakness is a control deficiency, or a
    combination of control deficiencies, in internal control over
    financial reporting, such that there is a reasonable possibility
    that a material misstatement of our annual or interim financial
    statements will not be prevented or detected on a timely basis.
    The control deficiencies described above, at varying degrees of
    severity, contributed to the material weaknesses in the control
    environment as further described in "Management's
    Discussion and Analysis of Financial Condition and Results of
    Operations -Internal Controls and Procedures".
In response, we have begun the process of evaluating our
    internal control over financial reporting, although we are in
    the early phases of our review and will not complete our review
    until well after this
29
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offering is completed. We cannot predict the outcome of our
    review at this time. During the course of the review, we may
    identify additional control deficiencies of varying degrees of
    severity, in addition to the material weaknesses discussed
    above. Although remediation efforts are still in progress,
    management has taken steps to address the causes of our audit
    adjustments and to improve our internal control over financial
    reporting, including the implementation of new accounting
    processes and control procedures and the identification of gaps
    in our skills base and expertise of the staff required to meet
    the financial reporting requirements of a public company.
We are not currently required to comply with the SEC's
    rules implementing Section 404 of the
Sarbanes-Oxley
Act of 2002, and are therefore not required to make a formal
    assessment of the effectiveness of our internal control over
    financial reporting for that purpose. Upon becoming a public
    company, we will be required to comply with the SEC's rules
    implementing Section 302 of the Sarbanes-Oxley Act of 2002,
    which will require our management to certify financial and other
    information in our quarterly and annual reports and provide an
    annual management report on the effectiveness of our internal
    control over financial reporting. We will not be required to
    make our first assessment of our internal control over financial
    reporting until the year following our first annual report
    required to be filed with the SEC. To comply with the
    requirements of being a public company, we will need to upgrade
    our systems, including information technology, implement
    additional financial and management controls, reporting systems
    and procedures and hire additional accounting, finance and legal
    staff.
Our efforts to develop and maintain our internal controls may
    not be successful, and we may be unable to maintain effective
    controls over our financial processes and reporting in the
    future and comply with the certification and reporting
    obligations under Sections 302 and 404 of the
Sarbanes-Oxley
Act. Any failure to develop or maintain effective controls, or
    any difficulties encountered in our implementation or
    improvement of our internal controls over financial reporting
    could result in material misstatements that are not prevented or
    detected on a timely basis, which could potentially subject us
    to sanctions or investigations by the SEC, the NYSE or other
    regulatory authorities. Ineffective internal controls could also
    cause investors to lose confidence in our reported financial
    information.
We do
    not intend to pay, and we are currently prohibited from paying,
    dividends on our common stock and, consequently, your only
    opportunity to achieve a return on your investment is if the
    price of our stock appreciates.
We do not plan to declare dividends on shares of our common
    stock in the foreseeable future. Additionally, we are currently
    prohibited from making any cash dividends pursuant to the terms
    of our revolving credit facility. Consequently, your only
    opportunity to achieve a return on your investment in us will be
    if the market price of our common stock appreciates, which may
    not occur, and you sell your shares at a profit. There is no
    guarantee that the price of our common stock that will prevail
    in the market after this offering will ever exceed the price
    that you pay.
Future
    sales of our common stock in the public market could lower our
    stock price, and any additional capital raised by us through the
    sale of equity or convertible securities may dilute your
    ownership in us.
We may sell additional shares of common stock in subsequent
    public offerings. We may also issue additional shares of common
    stock or convertible securities. Assuming no exercise of the
    underwriters' over-allotment option, after the completion
    of this offering, we will
    have          
    outstanding shares of common stock. This number
    includes           shares
    that we and the selling stockholder are selling in this
    offering, which may be resold immediately in the public market.
    Following the completion of this offering, the selling
    stockholder will
    own           shares,
    or     % of our total outstanding
    shares, and certain of our affiliates will
    own           shares,     %
    of our outstanding shares, all of which are restricted from
    immediate resale under the federal securities laws and are
    subject to the
lock-up
agreements between such parties and the underwriters described
    in "Underwriters," but may be sold into the market in
    the future. We expect that the selling stockholder will be a
    party to a registration rights agreement with us which will
    require us to effect the registration of its shares in certain
    circumstances no earlier than 180 days after the date of
    this prospectus. The holders of the
    remaining           shares,
    or     % of our outstanding shares, are
    not subject to
lock-up
30
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agreements and, subject to compliance with Rule 144 under
    the Securities Act, may sell such shares into the public market.
As soon as practicable after this offering, we intend to file a
    registration statement with the SEC on
Form S-8
providing for the registration
    of           shares
    of our common stock issued or reserved for issuance under our
    stock incentive plan. Subject to the satisfaction of vesting
    conditions and the expiration of
lock-up
agreements, shares registered under this registration statement
    on
Form S-8
will be available for resale immediately in the public market
    without restriction.
We cannot predict the size of future issuances of our common
    stock or the effect, if any, that future issuances and sales of
    shares of our common stock will have on the market price of our
    common stock. Sales of substantial amounts of our common stock
    (including shares issued in connection with an acquisition), or
    the perception that such sales could occur, may adversely affect
    prevailing market prices of our common stock.
Our
    certificate of incorporation and bylaws, as well as Delaware
    law, contain provisions that could discourage acquisition bids
    or merger proposals, which may adversely affect the market price
    of our common stock.
Our certificate of incorporation authorizes our board of
    directors to issue preferred stock without stockholder approval.
    If our board of directors elects to issue preferred stock, it
    could be more difficult for a third party to acquire us. In
    addition, some provisions of our certificate of incorporation
    and bylaws could make it more difficult for a third party to
    acquire control of us, even if the change of control would be
    beneficial to our stockholders, including:
•
a classified board of directors, so that only approximately
    one-third of our directors are elected each year;
•
limitations on the removal of directors; and
•
limitations on the ability of our stockholders to call special
    meetings and establish advance notice provisions for stockholder
    proposals and nominations for elections to the board of
    directors to be acted upon at meetings of stockholders.
Delaware law prohibits us from engaging in any business
    combination with any "interested stockholder," meaning
    generally that a stockholder who beneficially owns more than 15%
    of our stock cannot acquire us for a period of three years from
    the date this person became an interested stockholder, unless
    various conditions are met, such as approval of the transaction
    by our board of directors.
The
    concentration of our capital stock ownership among our largest
    stockholders and their affiliates will limit your ability to
    influence corporate matters.
Upon completion of this offering, we anticipate that OAS Holdco,
    the selling stockholder, will own
    approximately     % of our outstanding
    common stock and EnCap and its affiliates will
    own     % of the selling stockholder
    (based on an assumed initial public offering price of
    $     per share). Consequently, EnCap and
    its affiliates will continue to have significant influence over
    all matters that require approval by our stockholders, including
    the election of directors and approval of significant corporate
    transactions. This concentration of ownership will limit your
    ability to influence corporate matters, and as a result, actions
    may be taken that you may not view as beneficial.
Furthermore, conflicts of interest could arise in the future
    between us, on the one hand, and EnCap and its affiliates,
    including its portfolio companies, on the other hand, concerning
    among other things, potential competitive business activities or
    business opportunities. EnCap is a private equity firm in the
    business of making investments in entities primarily in the
    U.S. oil and gas industry. As a result, EnCap's
    existing and future portfolio companies which it controls may
    compete with us for investment or business opportunities. These
    conflicts of interest may not be resolved in our favor.
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We
    will be a "controlled company" within the meaning of
    the NYSE rules and, as a result, will qualify for and will rely
    on exemptions from certain corporate governance
    requirements.
Because OAS Holdco will own a majority of our outstanding common
    stock following the completion of this offering, we will be a
    "controlled company" as that term is set forth in
    Section 303A of the NYSE Listed Company Manual. Under the
    NYSE rules, a company of which more than 50% of the voting power
    is held by another person or group of persons acting together is
    a "controlled company" and may elect not to comply
    with certain NYSE corporate governance requirements, including:
•
the requirement that a majority of our board of directors
    consist of independent directors;
•
the requirement that our nominating and corporate governance
    committee be composed entirely of independent directors with a
    written charter addressing the committee's purpose and
    responsibilities; and
•
the requirement that our compensation committee be composed
    entirely of independent directors with a written charter
    addressing the committee's purpose and responsibilities.
These requirements will not apply to us as long as we remain a
    "controlled company." Following this offering, we may
    utilize some or all of these exemptions. Accordingly, you may
    not have the same protections afforded to stockholders of
    companies that are subject to all of the corporate governance
    requirements of the NYSE. EnCap's significant ownership
    interest could adversely affect investors' perceptions of
    our corporate governance.
Certain
    federal income tax deductions currently available with respect
    to oil and gas exploration and development may be eliminated as
    a result of future legislation.
On February 1, 2010, the White House released President
    Obama's budget proposal for the fiscal year 2011, or the
    Budget Proposal. Among the changes recommended in the Budget
    Proposal is the elimination of certain key U.S. federal
    income tax preferences currently available to coal, oil and gas
    exploration and production companies. These changes include, but
    are not limited to, (i) the repeal of the percentage
    depletion allowance for oil and gas properties, (ii) the
    elimination of current deductions for intangible drilling and
    development costs, (iii) the elimination of the deduction
    for United States production activities, and (iv) the
    increase in the amortization period from two years to seven
    years for geophysical costs paid or incurred in connection with
    the exploration for, or development of, oil or gas within the
    United States.
It is unclear whether any such changes will actually be enacted
    or, if enacted, how soon any such changes could become
    effective. The passage of any legislation as a result of the
    Budget Proposal or any other similar change in U.S. federal
    income tax law could affect certain tax deductions that are
    currently available with respect to oil and gas exploration and
    production and could negatively impact the value of an
    investment in our shares.
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CAUTIONARY
    NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements that are
    subject to a number of risks and uncertainties, many of which
    are beyond our control. All statements, other than statements of
    historical fact included in this prospectus, regarding our
    strategy, future operations, financial position, estimated
    revenues and losses, projected costs, prospects, plans and
    objectives of management are forward-looking statements. When
    used in this prospectus, the words "could,"
    "believe," "anticipate," "intend,"
    "estimate," "expect," "may,"
    "continue," "predict,"
    "potential," "project" and similar
    expressions are intended to identify forward-looking statements,
    although not all forward-looking statements contain such
    identifying words.
Forward-looking statements may include statements about our:
•
business strategy;
•
reserves;
•
technology;
•
cash flows and liquidity;
•
financial strategy, budget, projections and operating results;
•
oil and natural gas realized prices;
•
timing and amount of future production of oil and natural gas;
•
availability of drilling and production equipment;
•
availability of oil field labor;
•
the amount, nature and timing of capital expenditures, including
    future development costs;
•
availability and terms of capital;
•
drilling of wells;
•
competition and government regulations;
•
marketing of oil and natural gas;
•
exploitation or property acquisitions;
•
costs of exploiting and developing our properties and conducting
    other operations;
•
general economic conditions;
•
competition in the oil and natural gas industry;
•
effectiveness of our risk management activities;
•
environmental liabilities;
•
counterparty credit risk;
•
governmental regulation and taxation of the oil and natural gas
    industry;
•
developments in oil-producing and natural gas-producing
    countries;
•
uncertainty regarding our future operating results;
•
estimated future net reserves and present value thereof; and
•
plans, objectives, expectations and intentions contained in this
    prospectus that are not historical.
All forward-looking statements speak only as of the date of this
    prospectus. You should not place undue reliance on these
    forward-looking statements. Although we believe that our plans,
    intentions and expectations reflected in or suggested by the
    forward-looking statements we make in this prospectus are
    reasonable, we can give no assurance that these plans,
    intentions or expectations will be achieved. We disclose
    important factors that could cause our actual results to differ
    materially from our expectations under "Risk Factors"
    and "Management's Discussion and Analysis of Financial
    Condition and Results of Operations" and elsewhere in this
    prospectus. These cautionary statements qualify all
    forward-looking statements attributable to us or persons acting
    on our behalf.
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USE OF
    PROCEEDS
We will receive net proceeds of approximately
    $      million from the sale of
    the common stock offered by us, assuming an initial public
    offering price of $      per share (the
    midpoint of the price range set forth on the cover page of this
    prospectus) and after deducting estimated expenses and
    underwriting discounts and commissions of approximately
    $      million. If the
    underwriters' over-allotment option is exercised in full,
    we estimate that our net proceeds will be approximately
    $      million. We will not
    receive any of the proceeds from the sale of shares of our
    common stock by the selling stockholder.
We intend to use a portion of net proceeds from this offering to
    repay all outstanding indebtedness under our revolving credit
    facility. The remaining proceeds of approximately
    $      million and any proceeds from
    any exercise of the underwriters' option to purchase
    additional common stock from us will be used to fund
    exploration, development and other capital expenditures, as well
    as for general corporate purposes. Our revolving credit facility
    matures in February 2014 and bears interest at a rate of 4.0%
    per annum as of March 1, 2010. Our outstanding borrowings
    under our revolving credit facility were incurred to fund
    exploration, development and other capital expenditures.
    Affiliates of certain of the underwriters are lenders under our
    revolving credit facility and, accordingly, will receive a
    portion of the proceeds from this offering.
We estimate that the selling stockholder will receive net
    proceeds of approximately
    $      million from the sale
    of          
    common shares in this offering based upon the assumed initial
    offering price of $      per share,
    after deducting underwriting discounts. If the
    underwriters' over-allotment option is exercised in full,
    we estimate that the selling stockholder's net proceeds
    will be approximately
    $      million. We will pay all
    expenses related to this offering, other than underwriting
    discounts and commissions related to the shares sold by the
    selling stockholder.
An increase or decrease in the initial public offering price of
    $1.00 per share of common stock would cause the net proceeds
    that we will receive from the offering, after deducting
    estimated expenses and underwriting discounts and commissions,
    to increase or decrease by approximately
    $      million.
EnCap and certain of its affiliates, as well as certain of our
    executive officers, will indirectly receive proceeds from the
    sale of common stock by the selling stockholder as a result of a
    distribution of proceeds by the selling stockholder to its
    members.
DIVIDEND
    POLICY
We do not anticipate declaring or paying any cash dividends to
    holders of our common stock in the foreseeable future. We
    currently intend to retain future earnings, if any, to finance
    the expansion of our business. Our future dividend policy is
    within the discretion of our board of directors and will depend
    upon various factors, including our results of operations,
    financial condition, capital requirements and investment
    opportunities. In addition, our revolving credit facility
    prohibits us from paying cash dividends.
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CAPITALIZATION
The following table sets forth the capitalization of Oasis
    Petroleum LLC and Oasis Petroleum Inc., as applicable, as of
    December 31, 2009,
•
on an actual basis;
•
on an as adjusted basis to give effect to the transactions
    described under "Corporate Reorganization" that will
    occur simultaneously with the closing of this offering; and
•
on an as further adjusted basis to give effect to this offering
    and the application of the net proceeds as set forth under
    "Use of Proceeds."
You should read the following table in conjunction with
    "Use of Proceeds," "Selected Historical
    Consolidated and Unaudited Pro Forma Financial Data,"
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations" and our historical
    consolidated financial statements and unaudited pro forma
    financial information and related notes thereto appearing
    elsewhere in this prospectus.
As of December 31, 2009
As Further
Actual
As Adjusted
Adjusted
(In thousands)
Cash and cash equivalents
(1)
$
40,562
$
40,562
$
Long-term debt, including current maturities:
Revolving credit facility(2)
$
35,000
$
35,000
$
—
Total long-term debt
35,000
35,000
—
Members' / stockholders' equity:
Capital contributions
235,000
—
—
Common stock, $0.001 par value; no shares authorized,
    issued and outstanding
    (actual);           shares
    authorized (as adjusted and as further adjusted); shares issued
    and outstanding (as
    adjusted);           shares
    issued and outstanding (as further adjusted)
—
—
Preferred stock, $0.001 par value; no shares authorized
    (actual); shares authorized (as adjusted and as further
    adjusted); no shares issued and outstanding
—
—
—
Additional paid-in capital
—
235,000
Retained earnings (accumulated loss)(3)
(63,150
)
(71,150
)
Total members'/stockholders' equity
171,850
163,850
Total capitalization
$
206,850
$
198,850
$
(1)
As of March 1, 2010, our cash and cash equivalents were
    $5.1 million.
(2)
On February 26, 2010, we entered into an amended and
    restated revolving credit facility, which will have a borrowing
    base of $70 million upon the completion of this offering.
    Prior to amending and restating our revolving credit facility,
    we repaid substantially all outstanding indebtedness under our
    revolving credit facility with cash on hand. As of March 1,
    2010, we had $13.0 million of indebtedness outstanding
    under our revolving credit facility, which we plan to repay in
    full using a portion of the net proceeds from this offering.
(3)
In connection with our corporate reorganization, an estimated
    net deferred tax liability of approximately $8.0 million
    will be established for differences between the book and tax
    basis of our assets and liabilities and a corresponding expense
    will be recorded to net income from continuing operations.
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DILUTION
Purchasers of the common stock in this offering will experience
    immediate and substantial dilution in the net tangible book
    value per share of the common stock for accounting purposes. Our
    net tangible book value as of December 31, 2009, after
    giving pro forma effect to the transactions described under
    "Corporate Reorganization," was approximately
    $      million, or
    $      per share of common stock. Pro
    forma net tangible book value per share is determined by
    dividing our pro forma tangible net worth (tangible assets less
    total liabilities) by the total number of outstanding shares of
    common stock that will be outstanding immediately prior to the
    closing of this offering. After giving effect to our corporate
    reorganization and the sale of the shares in this offering and
    assuming the receipt of the estimated net proceeds (after
    deducting estimated discounts and expenses of this offering),
    our adjusted pro forma net tangible book value as of
    December 31, 2009 would have been approximately
    $      million, or
    $      per share. This represents an
    immediate increase in the net tangible book value of
    $      per share to our existing
    stockholders and an immediate dilution (i.e., the difference
    between the offering price and the adjusted pro forma net
    tangible book value after this offering) to new investors
    purchasing shares in this offering of
    $      per share. The following table
    illustrates the per share dilution to new investors purchasing
    shares in this offering:
Assumed initial public offering price per share
$
Pro forma net tangible book value per share as of
    December 31, 2009 (after giving effect to our corporate
    reorganization)
Increase per share attributable to new investors in this offering
As adjusted pro forma net tangible book value per share after
    giving effect to our corporate reorganization and this offering
Dilution in pro forma net tangible book value per share to new
    investors in this offering
$
The following table summarizes, on an adjusted pro forma basis
    as of December 31, 2009, the total number of shares of
    common stock owned by existing stockholders and to be owned by
    new investors, the total consideration paid, and the average
    price per share paid by our existing stockholders and to be paid
    by new investors in this offering at $ , the midpoint of the
    range of the initial public offering prices set forth on the
    cover page of this prospectus, calculated before deduction of
    estimated underwriting discounts and commissions:
Shares Acquired
Total Consideration
Average Price
Number
Percent
Amount
Percent
per Share
Existing stockholders(1)
%
$
%
$
New investors
—
—
—
—
Total
%
$
%
$
(1)
The number of shares disclosed for the existing stockholders
    includes           shares
    being sold by the selling stockholder in this offering. The
    number of shares disclosed for the new investors does not
    include
    the           shares
    being purchased by the new investors from the selling
    stockholder in this offering.
Assuming the underwriters' over-allotment option is
    exercised in full, sales by us in this offering will reduce the
    percentage of shares held by existing stockholders
    to     % and will increase the number
    of shares held by new investors
    to          ,
    or     % on an adjusted pro forma basis
    as of December 31, 2009.
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Table of Contents
SELECTED
    HISTORICAL CONSOLIDATED AND UNAUDITED PRO FORMA FINANCIAL
    DATA
You should read the following selected financial data in
    conjunction with "Corporate Reorganization,"
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations" and our historical
    consolidated financial statements and unaudited pro forma
    financial information and related notes thereto included
    elsewhere in this prospectus. We believe that the assumptions
    underlying the preparation of our historical consolidated
    financial statements and unaudited pro forma financial data are
    reasonable. The financial information included in this
    prospectus may not be indicative of our future results of
    operations, financial position and cash flows.
Set forth below is our selected historical consolidated
    financial data for the period from February 26, 2007, the
    date of inception of Oasis Petroleum LLC, through
    December 31, 2007, the years ended December 31, 2008
    and 2009 and balance sheet data at December 31, 2008 and
    2009, all of which have been derived from the audited financial
    statements of Oasis Petroleum LLC included elsewhere in this
    prospectus. The balance sheet data at December 31, 2007 has
    been derived from the audited financial statements of Oasis
    Petroleum LLC not included elsewhere in this prospectus. The
    unaudited pro forma financial data for the year ended
    December 31, 2009, which reflects the effects of the
    acquisition of interests in certain oil and gas properties from
    Kerogen Resources, Inc., is derived from the unaudited pro forma
    financial information included elsewhere in this prospectus. The
    unaudited pro forma financial information has been prepared as
    if the acquisition had taken place on January 1, 2009.
Historical
Period from
Pro Forma Year
February 26, 2007
Year Ended
Ended
(Inception) through
December 31,
December 31,
December 31, 2007
2008
2009
2009
(In thousands)
Statement of operations data:
Oil and gas revenues
$
13,791
$
34,736
$
37,755
$
41,999
Expenses:
Lease operating expenses
2,946
7,073
8,691
10,274
Production taxes
1,211
3,001
3,810
4,160
Depreciation, depletion and amortization
4,185
8,686
16,670
19,233
Exploration expenses
1,164
3,222
1,019
1,019
Rig termination(1)
—
—
3,000
3,000
Impairment of oil and gas properties(2)
1,177
47,117
6,233
6,233
Gain on sale of properties
—
—
(1,455
)
(1,455
)
General and administrative expenses
3,181
5,452
9,342
9,342
Total expenses
13,864
74,551
47,310
51,806
Operating loss
(73
)
(39,815
)
(9,555
)
(9,807
)
Other income (expense):
Change in unrealized gain (loss) on derivative instruments
(10,679
)
14,769
(7,043
)
(7,043
)
Realized gain (loss) on derivative instruments
(1,062
)
(6,932
)
2,296
2,296
Interest expense
(1,776
)
(2,404
)
(912
)
(912
)
Other income (expense)
40
(9
)
5
5
Total other income (expense)
(13,477
)
5,424
(5,654
)
(5,654
)
Net loss
$
(13,550
)
$
(34,391
)
$
(15,209
)
$
(15,461
)
(1)
For a discussion of our rig termination expenses, see
    Note 10 to our consolidated financial statements.
(2)
In 2008, we recognized a $45.5 million non-cash impairment
    charge on our proved properties to reflect the impact of
    significantly lower oil prices and a $1.6 million
    impairment charge on our unproved properties due to expiring
    leases. See Note 2 to our consolidated financial statements.
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As of December 31,
2007
2008
2009
(In thousands)
Balance sheet data:
Cash and cash equivalents
$
6,282
$
1,570
$
40,562
Net property, plant and equipment
92,918
114,220
181,573
Total assets
104,145
129,068
239,553
Long-term debt
46,500
26,000
35,000
Total members' equity
36,350
82,459
171,850
Period from
February 26, 2007
(Inception) through
Year Ended December 31,
December 31, 2007
2008
2009
(In thousands)
Other financial data:
Net cash provided by operating activities
$
2,284
$
13,766
$
6,148
Net cash used in investing activities
(91,988
)
(78,478
)
(80,756
)
Net cash provided by financing activities
95,986
60,000
113,600
Adjusted EBITDA(1)
5,431
12,269
16,668
(1)
Adjusted EBITDA is a non-GAAP financial measure. For a
    definition of Adjusted EBITDA and a reconciliation of Adjusted
    EBITDA to our net loss and net cash provided by operating
    activities, see "Summary Historical Consolidated and
    Unaudited Pro Forma Financial Data —
    Non-GAAP Financial Measure."
Set forth below is historical financial data for the years ended
    December 31, 2005 and 2006 and the six months ended
    June 30, 2007 for properties acquired from Bill Barrett
    Corporation, which constitute the accounting predecessor to
    Oasis Petroleum LLC. The historical financial data for the years
    ended December 31, 2005 and 2006 was derived from the
    historical accounting records of Bill Barrett Corporation. The
    historical financial data for the six months ended June 30,
    2007 have been derived from the audited statement of revenues
    and direct operating expenses for the properties acquired from
    Bill Barrett Corporation included elsewhere in this prospectus.
    Such statement does not reflect depreciation, depletion and
    amortization, general and administrative expenses, income taxes
    or interest expense.
Predecessor
Year Ended December 31,
Six Months Ended
2005
2006
June 30, 2007
(In thousands)
Statement of operations data:
Oil and gas revenues
$
20,494
$
25,207
$
10,686
Direct operating expenses
4,283
5,872
3,490
Excess of revenues over direct operating expenses
$
16,211
$
19,335
$
7,196
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Table of Contents
MANAGEMENT'S
    DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial
    condition and results of operations should be read in
    conjunction with our consolidated financial statements and
    related notes appearing elsewhere in this prospectus. The
    following discussion contains "forward-looking
    statements" that reflect our future plans, estimates,
    beliefs and expected performance. We caution that assumptions,
    expectations, projections, intentions, or beliefs about future
    events may, and often do, vary from actual results and the
    differences can be material. Some of the key factors which could
    cause actual results to vary from our expectations include
    changes in oil and natural gas prices, the timing of planned
    capital expenditures, availability of acquisitions,
    uncertainties in estimating proved reserves and forecasting
    production results, operational factors affecting the
    commencement or maintenance of producing wells, the condition of
    the capital markets generally, as well as our ability to access
    them, the proximity to and capacity of transportation
    facilities, and uncertainties regarding environmental
    regulations or litigation and other legal or regulatory
    developments affecting our business, as well as those factors
    discussed below and elsewhere in the prospectus, all of which
    are difficult to predict. In light of these risks, uncertainties
    and assumptions, the forward-looking events discussed may not
    occur. See "Cautionary Note Regarding Forward-Looking
    Statements."
Overview
We are an independent exploration and production company focused
    on the acquisition and development of unconventional oil and
    natural gas resources primarily in the Williston Basin. Since
    our inception, we have emphasized the acquisition of properties
    that provided current production and significant upside
    potential through further development. Our drilling activity is
    primarily directed toward projects that we believe can provide
    us with repeatable successes in the Bakken formation.
Our use of capital for acquisitions and development allows us to
    direct our capital resources to what we believe to be the most
    attractive opportunities as market conditions evolve. We have
    historically acquired properties that we believe will meet or
    exceed our rate of return criteria. For acquisitions of
    properties with additional development, exploitation and
    exploration potential, we have focused on acquiring properties
    that we expect to operate so that we can control the timing and
    implementation of capital spending. In some instances, we have
    acquired non-operated property interests at what we believe to
    be attractive rates of return either because they provided a
    foothold in a new area of interest or complemented our existing
    operations. We intend to continue to acquire both operated and
    non-operated properties to the extent we believe they meet our
    return objectives. In addition, our willingness to acquire
    non-operated properties in new areas provides us with
    geophysical and geologic data that may lead to further
    acquisitions in the same area, whether on an operated or
    non-operated basis.
Our company was formed in February 2007. We began active oil and
    natural gas operations in July 2007 following the acquisition of
    properties in the Williston Basin consisting of approximately
    175,000 net leasehold acres and approximately 1,000 Boe/d
    of then-current net production, substantially forming our core
    leasehold position in the West Williston project area. In May
    2008, we entered into a farm-in and purchase arrangement under
    which we earned or acquired approximately 48,000 net
    leasehold acres, establishing our initial position in the East
    Nesson project area. In June 2009, we acquired approximately
    40,000 net leasehold acres with then-current net production
    of approximately 800 Boe/d, approximately 83% of which was from
    the Williston Basin. This acquisition consolidated our acreage
    in the East Nesson project area and established our Sanish
    project area. In September 2009, we acquired an additional
    46,000 net leasehold acres with then-current production of
    approximately 300 Boe/d. This acquisition further consolidated
    our acreage in the East Nesson project area. Our acquisitions
    were financed with a combination of borrowings under our
    revolving credit
39
Table of Contents
facility, cash flows provided by operating activities and
    capital contributions made by EnCap and other private investors.
Adjusted
Production at
Closing Date of
Purchase Price(1)
Acquisition
Net Acreage at
Project Areas of Acquired Properties
Acquisition
(In millions)
(Boe/d)
Acquisition
West Williston(2)
June 22, 2007
$
83
1,000
175,000
East Nesson(3)
May 16, 2008
16
—
48,000
East Nesson/Sanish
June 15, 2009
27
800
40,000
East Nesson
September 30, 2009
11
300
46,000
(1)
Represents initial purchase price plus closing adjustments.
(2)
For accounting purposes, results from our West Williston
    acquisition are included in our results of operations effective
    July 1, 2007.
(3)
Our farm-in and purchase arrangement required an initial payment
    of $15.6 million and obligated us to spend
    $15.1 million of drilling costs on behalf of the other
    parties.
Because of our substantial recent acquisition activity, our
    discussion and analysis of our historical financial condition
    and results of operations for the periods discussed below may
    not necessarily be comparable with or applicable to our future
    results of operations. Our initial acquisition of properties in
    the Williston Basin was completed in June 2007 from Bill Barrett
    Corporation, which constitutes our accounting predecessor. Our
    historical results include the results from our recent
    acquisitions beginning on the closing dates indicated in the
    table above. See our unaudited pro forma financial information
    and related notes included elsewhere in this prospectus for more
    information about how our historical results of operations would
    have been affected had our June 2009 acquisition been completed
    on January 1, 2009.
Our 2009 activities included development and exploration
    drilling in each of our primary project areas. Our current
    activities are focused on evaluating and developing our asset
    base, optimizing our acreage positions and evaluating potential
    acquisitions. At December 31, 2009, based on the reserve
    report prepared by our independent reserve engineers, we had
    13.3 MMBoe of estimated net proved reserves with a
PV-10
of
    $133.5 million and a Standardized Measure of
    $133.5 million. At December 31, 2008, we had
    2.3 MMBoe of estimated net proved reserves with a
PV-10
of
    $17.7 million and a Standardized Measure of
    $17.7 million. Our estimated proved reserves and related
    future net revenues, PV-10 and Standardized Measure were
    determined using index prices for oil and natural gas, without
    giving effect to derivative transactions, and were held constant
    throughout the life of the properties. The unweighted arithmetic
    average first-day-of-the-month prices for the prior 12 months
    were $61.04/Bbl for oil and $3.87/MMBtu for natural gas at
    December 31, 2009, and the index prices were $44.60/Bbl for oil
    and $5.63/MMBtu for natural gas at December 31, 2008. These
    prices were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead.
Our revenue, profitability and future growth rate depend
    substantially on factors beyond our control, such as economic,
    political and regulatory developments as well as competition
    from other sources of energy. Oil and natural gas prices
    historically have been volatile and may fluctuate widely in the
    future. Sustained periods of low prices for oil or natural gas
    could materially and adversely affect our financial position,
    our results of operations, the quantities of oil and natural gas
    reserves that we can economically produce and our access to
    capital.
Sources
    of our revenue
Our revenues are derived from the sale of oil and natural gas
    production and do not include the effects of derivatives. Our
    revenues may vary significantly from period to period as a
    result of changes in volumes of production sold or changes in
    commodity prices.
40
Table of Contents
The following table summarizes our revenues and production data
    for the periods indicated.
Predecessor
Oasis Petroleum LLC
Period from
January 1, 2007
February 26, 2007
Year Ended
through
(Inception) through
December 31,
June 30, 2007(1)
December 31, 2007(2)
2008
2009
Operating results (in thousands):
Revenues
Oil
$
10,211
$
13,335
$
33,396
$
36,376
Natural gas
475
456
1,340
1,379
Total oil and gas revenues
$
10,686
$
13,791
$
34,736
$
37,755
Production data:
Oil (MBbls)
190
159
379
658
Natural gas (MMcf)
69
73
123
326
Oil equivalents (MBoe)
202
171
400
712
Average daily production (Boe/d)
929
1,092
1,950
Average sales prices:
Oil, without realized derivatives (per Bbl)
$
53.73
$
83.96
$
88.07
$
55.32
Oil, with realized derivatives (3) (per Bbl)
77.27
69.79
58.82
Natural gas (per Mcf)
6.87
6.25
10.91
4.24
(1)
The historical financial data for the six months ended
    June 30, 2007 have been derived from the audited statement
    of revenues and direct operating expenses for the properties
    acquired from Bill Barrett Corporation included elsewhere in
    this prospectus.
(2)
For the period from February 26, 2007 through June 30,
    2007, we did not engage in oil and gas operating or producing
    activities. Average daily production includes production from
    July 1, 2007 through December 31, 2007.
(3)
Realized prices include realized gains or losses on cash
    settlements for commodity derivatives, which do not qualify for
    hedge accounting. We have not made any estimates of the impact
    of commodities derivatives on the average sales price for our
    predecessor.
Year
    ended December 31, 2009 as compared to year ended
    December 31, 2008
Oil and Natural Gas Revenues.
Our oil and
    natural gas sales revenues increased $3.0 million, or 9%,
    to $37.8 million during the year ended December 31,
    2009 as compared to the year ended December 31, 2008. Our
    revenues are a function of oil and natural gas production
    volumes sold and average sales prices received for those
    volumes. Average daily production sold increased by 858 Boe
    per day or 79% to 1,950 Boe per day during the year ended
    December 31, 2009 as compared to the year ended
    December 31, 2008. The increase in average daily production
    sold is primarily due to the East Nesson and Sanish acquisitions
    completed in 2009 and well completions in our East Nesson
    project area. This $16.2 million revenue increase
    attributable to higher production sold was almost entirely
    offset by a $13.2 million revenue reduction attributable to
    lower oil sales prices during the year ended December 31,
    2009. Average oil sales prices, without realized derivatives,
    declined by $32.75 per barrel or 37% to an average of $55.32 per
    barrel for the year ended December 31, 2009 as compared to
    the year ended December 31, 2008.
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Table of Contents
Year
    ended December 31, 2008 as compared to period from
    February 26, 2007 (Inception) through December 31,
    2007
Oil and Natural Gas Revenues.
Our oil and
    natural gas sales revenues increased $20.9 million, or
    152%, to $34.7 million for the year ended December 31,
    2008 compared to the period from February 26, 2007
    (inception) through December 31, 2007. This increase was
    primarily a result of production from properties acquired in our
    West Williston project area, which we owned for all of 2008 as
    compared to only the last six months in 2007. Average oil sales
    prices, without realized derivatives, increased by $4.11 per
    barrel or 5% to an average of $88.07 per barrel for the year
    ended December 31, 2008 as compared to the period ended
    December 31, 2007.
When comparing our revenue for the period from February 26,
    2007 (inception) through December 31, 2007 to our
    predecessor's revenues for the period from January 1
    through June 30, 2007, our revenues increased by
    $3.1 million or 29% to $13.8 million. The revenue
    increase is primarily due to average oil sales prices, without
    realized derivatives, that increased by $30.23 per barrel or 56%
    to an average of $83.96 per barrel.
Expenses
•
Lease operating expenses.
Lease operating
    expenses are daily costs incurred to bring oil and natural gas
    out of the ground and to the market, together with the daily
    costs incurred to maintain our producing properties. Such costs
    also include field personnel compensation, utilities,
    maintenance, repairs and workover expenses related to our oil
    and natural gas properties.
•
Production taxes.
Production taxes are paid on
    produced oil and natural gas based on a percentage of revenues
    from products sold at market prices (not hedged prices) or at
    fixed rates established by federal, state or local taxing
    authorities. We take full advantage of all credits and
    exemptions in our various taxing jurisdictions. In general, the
    production taxes we pay correlate to the changes in oil and
    natural gas revenues.
•
Depreciation, depletion and
    amortization.
Depreciation, depletion and
    amortization includes the systematic expensing of the
    capitalized costs incurred to acquire, explore and develop oil
    and natural gas. As a successful efforts company, we capitalize
    all costs associated with our acquisition and development
    efforts and all successful exploration efforts, and allocate
    these costs to each unit of production using the
units-of-production
method.
•
Exploration expenses.
Exploration expenses
    consist of exploratory dry hole expenses and costs incurred in
    evaluating areas that are considered to have prospective oil and
    natural gas reserves, including costs for topographical,
    geological and geophysical studies, rights of access to
    properties and costs of carrying and retaining undeveloped
    properties, such as delay rentals.
•
Impairment of unproved and proved
    properties.
These costs include unproved property
    impairment and costs associated with lease expirations. We could
    also record impairment charges for proved properties if the
    carrying value exceeds estimated future cash flows. See
    "— Impairment of proved properties."
•
General and administrative expenses.
General
    and administrative expenses include overhead, including payroll
    and benefits for our corporate staff, costs of maintaining our
    headquarters, costs of managing our production and development
    operations, franchise taxes, audit and other professional fees
    and legal compliance.
Other
    Income (Expense)
•
Change in unrealized gain (loss) on derivative
    instruments.
We utilize commodity derivative
    financial instruments to reduce our exposure to fluctuations in
    the price of crude oil and natural gas. This account activity
    represents the recognition of gains and losses associated with
    our open derivative contracts as commodity prices and commodity
    derivative contracts change.
42
Table of Contents
•
Realized gain (loss) on derivative instruments,
    net.
We utilize commodity derivative instruments
    to reduce our exposure to fluctuations in the price of crude oil
    and natural gas. The account activity represents our realized
    gains and losses on the settlement of these commodity derivative
    instruments.
•
Interest expense.
We finance a portion of our
    working capital requirements, capital expenditures and
    acquisitions with borrowings under our revolving credit
    facility. As a result, we incur interest expense that is
    affected by both fluctuations in interest rates and our
    financing decisions. We reflect interest paid to the lenders
    under our revolving credit facility in interest expense. In
    addition, we include the amortization of deferred financing
    costs (including origination and amendment fees), commitment
    fees and annual agency fees as interest expense.
•
Income tax expense.
As of December 31,
    2009, we were a limited liability company not subject to entity
    level income tax. Accordingly, no provision for federal or state
    corporate income taxes has been provided for the year ended
    December 31, 2009 or prior years because taxable income is
    allocated directly to our equity holders. In connection with the
    closing of this offering, we will merge into a corporation that
    will be subject to federal and state entity-level taxation. In
    connection with our corporate reorganization, a net deferred tax
    liability will be established for differences between the tax
    and book basis of our assets and liabilities and a corresponding
    expense will be recorded to net income from continuing
    operations. We estimate the net deferred tax liability to be
    approximately $8.0 million. No tax benefit will be recorded
    for cumulative book losses generated while we were a limited
    liability company. We do not expect to be in a tax paying
    position for regular federal income taxes for the year ended
    December 31, 2010, primarily due to the current
    deductibility of intangible drilling costs, or IDC. We do expect
    to incur state income or franchise taxes in jurisdictions in
    which our IDC deductions do not exceed our taxable income or
    where state income or franchise taxes are determined on another
    basis.
43
Table of Contents
The following table summarizes our operating expenses for the
    periods indicated.
Oasis Petroleum LLC
Predecessor
Period from
January 1, 2007
February 26, 2007
Year Ended
through
(Inception) through
December 31,
June 30, 2007(1)
December 31, 2007(2)
2008
2009
(In thousands, except production cost and expense (per Boe of
    production))
Expenses:
Lease operating expenses
$
2,583
$
2,946
$
7,073
$
8,691
Production taxes
907
1,211
3,001
3,810
Depreciation, depletion and amortization
4,185
8,686
16,670
Exploration expenses
1,164
3,222
1,019
Rig termination
—
—
3,000
Impairment of oil and gas properties
1,177
47,117
6,233
Gain on sale of properties
—
—
(1,455
)
General and administrative expenses
3,181
5,452
9,342
Total expenses
$
13,864
$
74,551
$
47,310
Operating loss
(73
)
(39,815
)
(9,555
)
Other income (expense):
Change in unrealized gain (loss) on derivative instruments
(10,679
)
14,769
(7,043
)
Realized gain (loss) on derivative instruments, net
(1,062
)
(6,932
)
2,296
Interest expense
(1,776
)
(2,404
)
(912
)
Other income (expense)
40
(9
)
5
Total other income (expense)
(13,477
)
5,424
(5,654
)
Net loss
$
(13,550
)
$
(34,391
)
$
(15,209
)
Cost and expense (per Boe of production):
Lease operating expenses
$
12.79
$
17.23
$
17.70
$
12.21
Production taxes
4.49
7.08
7.51
5.35
Depreciation, depletion and amortization
24.47
21.73
23.42
General and administrative expenses
18.60
13.64
13.12
(1)
The historical financial data for the six months ended
    June 30, 2007 have been derived from the audited statement
    of revenues and direct operating expenses for the properties
    acquired from Bill Barrett Corporation included elsewhere in
    this prospectus. Such statement does not reflect depreciation,
    depletion and amortization, general and administrative expenses,
    income taxes or interest expense.
(2)
For the period from February 26, 2007 through June 30,
    2007, we did not engage in oil and gas operating or producing
    activities. Average daily production includes production from
    July 1, 2007 through December 31, 2007.
Year
    ended December 31, 2009 compared to year ended
    December 31, 2008
Lease Operating Expenses.
Lease operating
    expenses increased $1.6 million for the year ended
    December 31, 2009 compared to the year ended
    December 31, 2008. This increase was primarily due to the
    higher number of productive wells from our East Nesson and
    Sanish acquisitions that were completed in 2009. The 73%
    increase in oil volumes from 2008 to 2009 resulted in a 31%
    decrease in unit operating costs to $12.21 per Boe. The
    2008 unit operating costs were also higher on a per barrel
    basis due to increased equipment repair and salt water disposal
    costs for the properties in our West Williston project area.
Production Taxes.
Our production taxes for the
    years ended December 31, 2009 and 2008 were 10.1% and 8.6%,
    respectively, as a percentage of oil and natural gas sales. The
    2009 production tax rate was higher than the 2008 production tax
    rate due to the increased weighting of revenues in North Dakota
    which imposes
44
Table of Contents
an 11.5% production tax rate. The 2008 production taxes were
    primarily for oil and natural gas sales revenue associated with
    the properties in our West Williston project area acquired in
    2007. A portion of the properties in our West Williston project
    area generate revenues that are subject to lower Montana
    production tax rates and certain North Dakota exemptions.
Depreciation, Depletion and Amortization
    (DD&A).
Depreciation, depletion and
    amortization expense increased $8.0 million for the year
    ended December 31, 2009 compared to the year ended
    December 31, 2008. The 2009 expense increase is primarily
    due to a 73% production increase from the 2009 East Nesson and
    Sanish acquisitions. The 2009 DD&A rate was $23.42 per Boe
    compared to $21.73 per Boe in 2008. The increase from 2008 to
    2009 was due to higher acquisition, leasehold, drilling and
    completion costs in the East Nesson and Sanish project areas.
Exploration Expenses.
Exploration expenses of
    $1.0 million in the year ended December 31, 2009 were
    primarily composed of exploratory geological and geophysical
    costs. The comparable period in 2008 contained exploratory dry
    hole costs of $1.3 million and higher expenditures for
    exploratory geological and geophysical costs.
Rig Termination.
During 2008, we entered into
    drilling rig contracts with two drilling contractors. In the
    fourth quarter of 2008, we reduced our planned 2009 capital
    expenditure program and entered into discussions regarding early
    termination of these contracts. In the first quarter of 2009, we
    paid a total of $3.0 million in rig termination expenses in
    connection with the termination of our remaining commitment
    under one drilling rig contract and the extension of the other
    drilling rig contract until June 2010.
In November 2009, we entered into a new six-month drilling rig
    contract which replaced the contract we had previously extended.
    In the event of an early termination under this new drilling rig
    contract, we are obligated to pay a daily shortfall rate of
    $9,000 per day for the days remaining between the date of
    termination and May 15, 2010, the end of the primary
    contract term.
Impairment of Oil and Gas Properties.
During
    the years ended December 31, 2009 and 2008, we recorded
    $0.8 million and $45.5 million, respectively, in
    non-cash impairment charges on our proved oil and gas
    properties. The 2008 charges reflected the impact of
    significantly lower oil prices reflected in our 2008 reserve
    report.
During the years ended December 31, 2009 and 2008, we
    recorded non-cash impairment charges of $5.4 million and
    $1.6 million, respectively, for unproved property leases
    that expired during the period.
Gain on Sale of Properties.
In December 2009,
    we sold our interests in non-core oil and natural gas producing
    properties located in the Barnett shale in Texas for
    $1.5 million. We recognized a gain of $1.4 million
    from the sale of these divested properties.
General and Administrative.
Our general and
    administrative expenses increased to $9.3 million for the
    year ended December 31, 2009 from $5.5 million for the
    year ended December 31, 2008. This increase was primarily
    due to higher costs related to employee bonus compensation,
    additional employees and higher advisory, audit, legal and tax
    fees related to our initial public offering. As of
    December 31, 2009, we had 27 full-time employees
    compared to 20 employees as of December 31, 2008. On a
    per unit basis, general and administrative expenses were $13.12
    per Boe compared to $13.64 per Boe for the years ended
    December 31, 2009 and 2008, respectively.
Derivatives.
As a result of our derivative
    activities, we incurred cash settlement gains of
    $2.3 million for the year ended December 31, 2009 and
    cash settlement losses of $6.9 million for the year ended
    December 31, 2008. In addition, as a result of forward oil
    price changes, we recognized $7.0 million of unrealized
mark-to-market
non-cash derivative losses in 2009 and $14.8 million of
    unrealized
mark-to-market
non-cash derivative gains during 2008.
Interest Expense.
Interest expense decreased
    $1.5 million, or 62%, for the year ended December 31,
    2009 compared to the year ended December 31, 2008, due to a
    lower weighted average outstanding debt balance and a lower
    weighted average interest rate during 2009. Our weighted average
    debt balance decreased to $22.8 million for the year ended
    December 31, 2009 compared to $37.7 million for the
    year ended
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December 31, 2008. The weighted average interest rate on
    our revolving credit facility borrowings was 3.5% for the year
    ended December 31, 2009 compared to 6.3% for the same
    period in 2008. At December 31, 2009 our outstanding debt
    balance under our revolving credit facility was
    $35.0 million with a weighted average interest rate of
    2.95%.
Year
    ended December 31, 2008 compared to period from
    February 26, 2007 (Inception) through December 31,
    2007
Lease Operating Expenses.
Lease operating
    expenses increased $4.1 million for the year ended
    December 31, 2008 compared to the period from
    February 26, 2007 to December 31, 2007. The West
    Williston oil and natural gas producing properties were
    purchased in June 2007 and are reflected in only six months of
    our 2007 operating results as compared to a full twelve months
    in 2008. Lease operating expenses were $17.70 and
    $17.23 per Boe for the year ended December 31, 2008
    and for the period from February 26, 2007 (inception)
    through December 31, 2007, respectively. The unit operating
    costs for the year ended December 31, 2008 were higher on a
    Boe unit basis due to increased equipment repair and salt water
    disposal costs for our West Williston properties. When comparing
    our lease operating expenses for the period from
    February 26, 2007 (inception) through December 31,
    2007 to our predecessor's lease operating expenses from
    January 1 through June 30, 2007, our lease operating
    expenses increased by $0.4 million or 14% to
    $2.9 million. The lease operating expense increase is
    primarily due to the increase in oil and gas operating and
    producing activities.
Production Taxes.
Our production taxes for the
    year ended December 31, 2008, the period from
    February 26, 2007 (inception) through December 31,
    2007 and our predecessor's production taxes for the period
    from January 1 through June 30, 2007 were 8.6%, 8.8%
    and 8.5% respectively, of oil and natural gas sales for our West
    Williston oil and gas producing properties.
Depreciation, Depletion and
    Amortization.
Depreciation, depletion and
    amortization expense increased $4.5 million for the year
    ended December 31, 2008 compared to the period from
    February 26, 2007 to December 31, 2007. The West
    Williston oil and gas producing properties were purchased in
    June 2007 and are reflected in only six months of our 2007
    operating results as compared to a full twelve months in 2008.
    The depreciation, depletion and amortization rate was $21.73 per
    Boe for the year ended December 31, 2008 as compared to
    $24.47 per Boe in the period from February 26, 2007
    (inception) through December 31, 2007. This increase was
    due to higher drilling and completion costs in the year ended
    December 31, 2008.
Exploration Expenses.
Exploration expenses of
    $3.2 million in the year ended December 31, 2008
    included $1.3 million of dry hole costs with the remaining
    geological and geophysical costs comparable to those incurred
    from February 26, 2007 to December 31, 2007. For the
    period ended December 31, 2007, we did not incur any dry
    hole costs.
Impairment of Oil and Gas Properties.
During
    the year ended December 31, 2008, we recorded a non-cash
    impairment charge of $45.5 million on our proved oil and
    gas properties as a result of lower crude oil prices at
    December 31, 2008, without a comparable charge for the
    period ended December 31, 2007. During the year ended
    December 31, 2008 and the period from February 26,
    2007 to December 31, 2007, we recorded non-cash impairment
    charges of $1.6 million and $1.2 million,
    respectively, for unproved property leases that expired during
    the period.
General and Administrative.
General and
    administrative expenses increased to $5.5 million for the
    year ended December 31, 2008 from $3.2 million during
    the period from February 26, 2007 through December 31,
    2007. This increase was due both to a full 12 months of
    operations in 2008 as well as to the
start-up
nature of our activities in the 2007 period. General and
    administrative expenses were $13.64 per Boe for the year
    ended December 31, 2008 compared to $18.60 per Boe for the
    period ended 2007. The improvement was due to a full year of
    production volumes in the 2008 period versus only six months of
    volumes in the 2007 period.
Derivatives.
In connection with the West
    Williston acquisition in June 2007, we entered into fixed-price
    swap and collar contracts. As a result, only five contract
    settlement periods occurred during the period from
    February 26, 2007 through December 31, 2007 as
    compared to twelve contract settlement periods for the year
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ended December 31, 2008. We incurred cash settlement losses
    of $6.9 million and $1.1 million during the year ended
    December 31, 2008 and the period from February 26,
    2007 to December 31, 2007, respectively, on contract
    settlements of our crude oil derivative transactions. In
    addition, we recognized $14.8 million of unrealized
mark-to-market
non-cash derivative gains during the year ended
    December 31, 2008 as compared to $10.7 million of
    unrealized
mark-to-market
non-cash derivative losses during the period from
    February 26, 2007 through December 31, 2007 due to
    increases in forward oil prices during the 2008 period.
Interest Expense.
Interest expense increased
    $0.6 million, or 35%, for the year ended December 31,
    2008 compared to the period from February 26 through
    December 31, 2007, primarily due to our revolving credit
    facility borrowings being outstanding for a full 12 months
    in the 2008 period. The weighted average outstanding debt
    balance and weighted average interest rates were
    $37.7 million and 6.3% during for the year ended
    December 31, 2008. The weighted average outstanding debt
    balance and weighted average interest rates were
    $22.8 million and 7.81% during the period from February 26
    through December 31, 2007.
Liquidity
    and Capital Resources
Our primary sources of liquidity to date have been capital
    contributions from EnCap and other private investors, borrowings
    under our revolving credit facility and cash flows from
    operations. Our primary use of capital has been for the
    acquisition, development and exploration of oil and natural gas
    properties. We continually monitor potential capital sources,
    including equity and debt financings, in order to meet our
    planned capital expenditures and liquidity requirements. Our
    future success in growing proved reserves and production will be
    highly dependent on our ability to access outside sources of
    capital.
Our total 2010 capital expenditure budget is $220 million,
    which consists of:
•
$134 million for drilling and completing operated wells;
•
$45 million for drilling and completing non-operated wells;
•
$15 million for maintaining and expanding our leasehold
    position;
•
$5 million for constructing infrastructure to support
    production in our core project areas; and
•
$21 million in unallocated funds which are available for
    additional drilling and leasing costs and activity.
While we have budgeted $220 million for these purposes, the
    ultimate amount of capital we will expend may fluctuate
    materially based on market conditions and the success of our
    drilling results as the year progresses. To date, our 2010
    capital budget has been funded from a $35 million capital
    contribution from our equity investors in December 2009 and
    borrowings under our revolving credit facility. We believe the
    net proceeds from this offering together with cash flows from
    operations and additional borrowings under our revolving credit
    facility should be more than sufficient to fund the remainder of
    our 2010 and a portion of our 2011 capital expenditure budget.
    However, because the operated wells funded by our 2010 drilling
    plan represent only a small percentage of our gross identified
    operated drilling locations, we will be required to generate or
    raise multiples of this amount of capital to develop our entire
    inventory of identified drilling locations should we elect to
    do so.
On February 26, 2010, we entered into an amended and
    restated revolving credit facility, which will have a borrowing
    base of $70 million upon the completion of this offering.
    As of March 1, 2010 we had $13.0 million of
    indebtedness outstanding and $57.0 million of borrowing
    capacity available under the conforming borrowing base
    commitment of our revolving credit facility. For more
    information regarding our revolving credit facility, see
    "— Reserve-based credit facility."
We expect that in the future our commodity derivative positions
    will help us stabilize a portion of our expected cash flows from
    operations despite potential declines in the price of oil and
    natural gas. Please see "— Quantitative and
    Qualitative Disclosures About Market Risk."
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We actively review acquisition opportunities on an ongoing
    basis. Our ability to make significant additional acquisitions
    for cash would require us to obtain additional equity or debt
    financing, which we may not be able to obtain on terms
    acceptable to us or at all.
Our cash flows for the period from February 26, 2007
    through December 31, 2007 and the years ended
    December 31, 2008 and 2009, respectively, are presented
    below (in thousands):
Period from
February 26, 2007
(Inception) through
Year Ended December 31,
December 31, 2007
2008
2009
Net cash provided by operating activities
$
2,284
$
13,766
$
6,148
Net cash used in investing activities
(91,988
)
(78,478
)
(80,756
)
Net cash provided by financing activities
95,986
60,000
113,600
Net change in cash
$
6,282
$
(4,712
)
$
38,992
Cash
    flows provided by operating activities
Net cash provided by operating activities was $2.3 million
    for the period from February 26, 2007 through
    December 31, 2007, and $13.8 million and
    $6.1 million for the years ended December 31, 2008 and
    2009, respectively. The increase in cash flows from operations
    for the year ended December 31, 2008 compared to period
    ended December 31, 2007 was primarily the result of an
    increase in oil and natural gas production. Cash flows from
    operations during the year ended December 31, 2009
    decreased compared to 2008 primarily as a result of a
    $3.0 million rig termination payment and $3.9 million
    increase in general and administration expenses related to the
    initial public offering.
Our operating cash flows are sensitive to a number of variables,
    the most significant of which is the volatility of oil and gas
    prices. Regional and worldwide economic activity, weather,
    infrastructure capacity to reach markets and other variable
    factors significantly impact the prices of these commodities.
    These factors are beyond our control and are difficult to
    predict. For additional information on the impact of changing
    prices on our financial position, see
    "— Quantitative and Qualitative Disclosures About
    Market Risk" below.
Cash
    flows used in investing activities
We had cash flows used in investing activities of
    $92.0 million during the period from February 26, 2007
    through December 31, 2007 and we had $78.5 million and
    $80.8 million during the years ended December 31, 2008
    and 2009, respectively, as a result of our capital expenditures
    for drilling, development and acquisition costs. The decrease in
    cash flows used in investing activities during the year ended
    December 31, 2008 compared to the period ended
    December 31, 2007 was attributable to the completion of the
    acquisition of the West Williston assets in 2007. The increase
    in cash used in investing activities for the year ended
    December 31, 2009 compared to 2008 of $2.3 million was
    attributable to our acquisitions of properties in the East
    Nesson and Sanish project areas, as well as increased levels of
    expenditures for the development of our properties.
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Our capital expenditures for drilling, development and
    acquisition costs for the period from February 26, 2007 to
    December 31, 2007 and the years ended December 31,
    2008 and 2009 are summarized in the following table (in
    thousands):
Period from
February 26, 2007
Year Ended
(Inception) through
December 31,
December 31, 2007
2008
2009
Project Area:
West Williston
$
95,109
$
12,703
$
15,521
East Nesson
—
66,513
40,208
Sanish
—
—
32,952
Other(1)
—
—
582
Total(2)
$
95,109
$
79,216
$
89,263
(1)
Represents data relating to our properties in the Barnett shale.
(2)
Consolidated capital expenditures reflected in the table above
    differ from the amounts shown in the statement of cash flows in
    our financial statements because amounts reflected in the table
    include changes in accounts payable from the previous reporting
    period for capital expenditures, while the amounts presented in
    the statement of cash flows are presented on a cash basis.
Our board of directors has approved a total capital expenditure
    budget of $220 million for 2010, which is a 147% increase
    over the $89 million invested during 2009. Our capital
    budget may be adjusted as business conditions warrant. The
    amount, timing and allocation of capital expenditures is largely
    discretionary and within our control. If oil and natural gas
    prices decline or costs increase significantly, we could defer a
    significant portion of our budgeted capital expenditures until
    later periods to prioritize capital projects that we believe
    have the highest expected returns and potential to generate
    near-term cash flows. We routinely monitor and adjust our
    capital expenditures in response to changes in prices,
    availability of financing, drilling and acquisition costs,
    industry conditions, the timing of regulatory approvals, the
    availability of rigs, success or lack of success in drilling
    activities, contractual obligations, internally generated cash
    flows and other factors both within and outside our control.
Expenditures for exploration and development of oil and natural
    gas properties are the primary use of our capital resources. We
    anticipate investing $220 million for capital and
    exploration expenditures in 2010 as follows (in millions):
Amount
Exploration and development drilling
$
179
Land costs
15
Infrastructure
5
Unallocated funds available for additional drilling and leasing
    costs and activity.
21
$
220
Cash
    flows provided by financing activities
Net cash provided by financing activities was $96.0 million
    for period from February 26, 2007 through December 31,
    2007, and $60.0 million and $113.6 million for the
    years ended December 31, 2008 and 2009, respectively. For
    the period from February 26, 2007 through December 31,
    2007 and the years ended December 31, 2008 and 2009, cash
    sourced through financing activities was primarily provided by
    capital contributions from EnCap and other private investors and
    borrowings under our revolving credit facility. Our long-term
    debt, including the current portion, was $46.5 million,
    $26.0 million and $35.0 million at December 31,
    2007, 2008 and 2009, respectively.
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In March 2007, we entered into a limited liability company
    agreement that provided for an aggregate of $100 million in
    capital contribution commitments from EnCap, its affiliates and
    other investors, including certain members of management and
    other employees through Oasis Petroleum Management LLC. The
    original capital contribution commitment period extended from
    March 2007 until March 2010. In November 2007, the agreement was
    amended to increase the aggregate capital contribution
    commitment from $100 million to $200 million. In
    December 2009, the agreement was further amended to extend the
    commitment period to December 31, 2011 and increase the
    aggregate capital contribution commitment to $275 million.
    As of December 31, 2009, we had $40 million of
    remaining capital commitment capacity. This commitment will
    terminate upon the consummation of this offering.
Reserve-based
    credit facility
On February 26, 2010, we entered into an amended and restated
    reserve-based revolving credit facility under which our initial
    borrowing base was set at $85 million. Following the
    completion of this offering, we expect our borrowing base to be
    $70 million with an interest rate of 4.0% and a maturity of
    February 26, 2014. At the earlier of the closing of this
    offering or October 1, 2010, the $15 million
    non-conforming portion of the borrowing base will terminate. Our
    revolving credit facility is filed as an exhibit to the
    registration statement of which this prospectus is a part. Our
    revolving credit facility is available for our general corporate
    purposes, including, without limitation, working capital for
    exploration and production operations. Our obligations under our
    revolving credit facility are secured by substantially all of
    our assets.
As of March 1, 2010, we had $13.0 million outstanding
    under our revolving credit facility, the substantial majority of
    which was used to fund our drilling and acquisition activities.
    We anticipate that a portion of the net proceeds from this
    offering will be used to repay all of our borrowings outstanding
    as of the closing.
At our election, interest is generally determined by reference
    to:
•
the London interbank offered rate, or LIBOR, plus an applicable
    margin between 2.25% and 4.00% per annum; or
•
a domestic bank prime rate plus an applicable margin between
    0.75% and 2.50% per annum.
Interest is generally payable quarterly for domestic bank rate
    loans and on the last day of the applicable interest period for
    LIBOR loans, but not less frequently than quarterly.
Our revolving credit facility contains various covenants that
    limit our ability to:
•
incur indebtedness;
•
grant certain liens;
•
make certain loans, advances and investments;
•
make dividends, distributions or redemptions;
•
merge or consolidate;
•
engage in certain asset dispositions, including a sale of all or
    substantially all of our assets;
•
enter into certain transactions with affiliates;
•
grant negative pledges or agree to restrict dividends or
    distributions from subsidiaries;
•
allow gas imbalances,
take-or-pay
or other prepayments with respect to oil and gas properties that
    would require us from delivering hydrocarbons in the future in
    excess of an aggregate of 75,000 Mcfe; or
•
enter into certain swap agreements.
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Our revolving credit facility also contains covenants that,
    among other things, require us to maintain specified ratios or
    conditions as follows:
•
a current ratio, consisting of consolidated current assets,
    including the unused amount of the total commitments, to
    consolidated current liabilities of not less than 1.0 to 1.0,
    excluding non-cash derivative assets and liabilities, as of the
    last day of any fiscal quarter; and
•
a debt coverage ratio, consisting of consolidated debt
    (excluding non-cash obligations, accounts payable and other
    certain accrued liabilities) to consolidated net income plus
    interest expense, income taxes, depreciation, depletion,
    amortization, exploration expenses and other similar non-cash
    charges, minus all non-cash income added to consolidated net
    income, of not more than 4.0 to 1.0 for the four quarters ended
    on the last day of each fiscal quarter.
We believe that we are in compliance with the terms of our
    revolving credit facility. If an event of default exists under
    the credit agreement, the lenders will be able to accelerate the
    maturity of the credit agreement and exercise other rights and
    remedies. Each of the following will be an event of default:
•
failure to pay any principal or any reimbursement obligation
    under any letter of credit when due or any interest, fees or
    other amount within certain grace periods;
•
a representation or warranty is proven to be incorrect in any
    material respect when made;
•
failure to perform or otherwise comply with the covenants in the
    credit agreement or other loan documents, subject, in certain
    instances, to certain grace periods;
•
default by us on the payment of any other indebtedness in excess
    of $2.5 million, or any event occurs that permits or causes
    the acceleration of the indebtedness;
•
bankruptcy or insolvency events involving us or our subsidiaries;
•
the entry of, and failure to pay, one or more adverse judgments
    in excess of $2.0 million or one or more non-monetary
    judgments that could reasonably be expected to have a material
    adverse effect and for which enforcement proceedings are brought
    or that are not stayed pending appeal; and
•
a change of control, as defined in the credit agreement.
Obligations
    and Commitments
We have the following contractual obligations and commitments as
    of December 31, 2009 (in thousands):
Payments Due by Period
Less Than
More Than
Contractual Obligations
Total
1 Year
1 - 3 Years
3 - 5 Years
5 Years
Revolving credit facility(1)
$
35,000
$
—
$
35,000
$
—
$
—
Operating leases(2)
969
451
518
—
—
Drilling rig commitments(2)
2,575
2,575
—
—
—
Asset retirement obligations(3)
6,511
282
1,872
74
4,283
Total contractual cash obligations
$
45,055
$
3,308
$
37,390
$
74
$
4,283
(1)
Amount excludes interest on our revolving credit facility as
    both the amount borrowed and applicable interest rate is
    variable. On February 26, 2010, we entered into an amended
    and restated revolving credit facility, which matures on
    February 26, 2014. See Notes 7 and 11 to our
    consolidated financial statements.
(2)
See Note 10 to our consolidated financial statements for a
    description of lease obligations and drilling contract
    commitments.
(3)
Amounts represent our estimate of future asset retirement
    obligations on an undiscounted basis. Because these costs
    typically extend many years into the future, estimating these
    future costs requires management to make estimates and judgments
    that are subject to future revisions based upon numerous
    factors,
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including the rate of inflation, changing technology and the
    political and regulatory environment. See Note 8 to our
    consolidated financial statements.
Critical
    accounting policies and estimates
The discussion and analysis of our financial condition and
    results of operations are based upon our consolidated financial
    statements, which have been prepared in accordance with
    accounting principles generally accepted in the United States.
    The preparation of our financial statements requires us to make
    estimates and assumptions that affect the reported amounts of
    assets, liabilities, revenues and expenses and related
    disclosure of contingent assets and liabilities. Certain
    accounting policies involve judgments and uncertainties to such
    an extent that there is reasonable likelihood that materially
    different amounts could have been reported under different
    conditions, or if different assumptions had been used. We
    evaluate our estimates and assumptions on a regular basis. We
    base our estimates on historical experience and various other
    assumptions that are believed to be reasonable under the
    circumstances, the results of which form the basis for making
    judgments about the carrying values of assets and liabilities
    that are not readily apparent from other sources. Actual results
    may differ from these estimates and assumptions used in
    preparation of our consolidated financial statements. We provide
    expanded discussion of our more significant accounting policies,
    estimates and judgments below. We believe these accounting
    policies reflect our more significant estimates and assumptions
    used in preparation of our consolidated financial statements.
    See Note 2 to our consolidated financial statements for a
    discussion of additional accounting policies and estimates made
    by management.
Method
    of accounting for oil and natural gas properties
Oil and natural gas exploration and development activities are
    accounted for using the successful efforts method. Under this
    method, all property acquisition costs and costs of exploratory
    and development wells are capitalized when incurred, pending
    determination of whether the well has found proved reserves. If
    an exploratory well does not find proved reserves, the costs of
    drilling the well are charged to expense. The costs of
    development wells are capitalized whether productive or
    nonproductive. All capitalized well costs and leasehold costs of
    proved properties are amortized on a
unit-of-production
basis over the remaining life of proved developed reserves and
    proved reserves, respectively.
Costs of retired, sold or abandoned properties that constitute a
    part of an amortization base (partial field) are charged or
    credited, net of proceeds, to accumulated depreciation,
    depletion and amortization unless doing so significantly affects
    the
unit-of-production
amortization rate for an entire field, in which case a gain or
    loss is recognized currently. Gains or losses from the disposal
    of properties are recognized currently.
Expenditures for maintenance, repairs and minor renewals
    necessary to maintain properties in operating condition are
    expensed as incurred. Major betterments, replacements and
    renewals are capitalized to the appropriate property and
    equipment accounts. Estimated dismantlement and abandonment
    costs for oil and natural gas properties are capitalized, net of
    salvage, at their estimated net present value and amortized on a
unit-of-production
basis over the remaining life of the related proved developed
    reserves.
Unproved properties consist of costs incurred to acquire
    unproved leases, or lease acquisition costs. Unproved lease
    acquisition costs are capitalized until the leases expire or
    when we specifically identify leases that will revert to the
    lessor, at which time we expense the associated unproved lease
    acquisition costs. The expensing of the unproved lease
    acquisition costs is recorded as impairment expense in the
    statement of operations in our consolidated financial
    statements. Lease acquisition costs related to successful
    exploratory drilling are reclassified to proved properties and
    depleted on a
unit-of-production
basis.
For sales of entire working interests in unproved properties,
    gain or loss is recognized to the extent of the difference
    between the proceeds received and the net carrying value of the
    property. Proceeds from sales of partial interests in unproved
    properties are accounted for as a recovery of costs unless the
    proceeds exceed the entire cost of the property.
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Oil
    and natural gas reserve quantities and standardized measure of
    future net revenue
Our independent engineers and technical staff prepare our
    estimates of oil and natural gas reserves and associated future
    net revenues. While the SEC has recently adopted rules which
    allow us to disclose proved, probable and possible reserves, we
    have elected to present only proved reserves in this prospectus.
    The SEC's revised rules define proved reserves as the
    quantities of oil and gas, which, by analysis of geoscience and
    engineering data, can be estimated with reasonable certainty to
    be economically producible — from a given date
    forward, from known reservoirs, and under existing economic
    conditions, operating methods, and government
    regulations — prior to the time at which contracts
    providing the right to operate expire, unless evidence indicates
    that renewal is reasonably certain, regardless of whether
    deterministic or probabilistic methods are used for the
    estimation. The project to extract the hydrocarbons must have
    commenced or the operator must be reasonably certain that it
    will commence the project within a reasonable time. Our
    independent engineers and technical staff must make a number of
    subjective assumptions based on their professional judgment in
    developing reserve estimates. Reserve estimates are updated
    annually and consider recent production levels and other
    technical information about each field. Oil and natural gas
    reserve engineering is a subjective process of estimating
    underground accumulations of oil and natural gas that cannot be
    precisely measured. The accuracy of any reserve estimate is a
    function of the quality of available data and of engineering and
    geological interpretation and judgment. Periodic revisions to
    the estimated reserves and future cash flows may be necessary as
    a result of a number of factors, including reservoir
    performance, new drilling, oil and natural gas prices, cost
    changes, technological advances, new geological or geophysical
    data, or other economic factors. Accordingly, reserve estimates
    are generally different from the quantities of oil and natural
    gas that are ultimately recovered. We cannot predict the amounts
    or timing of future reserve revisions. If such revisions are
    significant, they could significantly affect future amortization
    of capitalized costs and result in impairment of assets that may
    be material.
Revenue
    recognition
Revenue from our interests in producing wells is recognized when
    the product is delivered, at which time the customer has taken
    title and assumed the risks and rewards of ownership, and
    collectability is reasonably assured. Substantially all of our
    production is sold to purchasers under short-term (less than
    12 month) contracts at market based prices. The sales
    prices for oil and natural gas are adjusted for transportation
    and other related deductions. These deductions are based on
    contractual or historical data and do not require significant
    judgment. Subsequently, these revenue deductions are adjusted to
    reflect actual charges based on third-party documents. Since
    there is a ready market for oil and natural gas, we sell the
    majority of production soon after it is produced at various
    locations. As a result, we maintain a minimum amount of product
    inventory in storage.
Impairment
    of proved properties
We review our proved oil and natural gas properties for
    impairment whenever events and circumstances indicate that a
    decline in the recoverability of their carrying value may have
    occurred. We estimate the expected undiscounted future cash
    flows of our oil and natural gas properties and compare such
    undiscounted future cash flows to the carrying amount of the oil
    and natural gas properties to determine if the carrying amount
    is recoverable. If the carrying amount exceeds the estimated
    undiscounted future cash flows, we will adjust the carrying
    amount of the oil and natural gas properties to fair value. The
    factors used to determine fair value are subject to our judgment
    and expertise and include, but are not limited to, recent sales
    prices of comparable properties, the present value of future
    cash flows, net of estimated operating and development costs
    using estimates of proved reserves, future commodity pricing,
    future production estimates, anticipated capital expenditures,
    and various discount rates commensurate with the risk and
    current market conditions associated with realizing the expected
    cash flows projected. Because of the uncertainty inherent in
    these factors, we cannot predict when or if future impairment
    charges for proved properties will be recorded.
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Impairment
    of unproved properties
We assess our unproved properties periodically for impairment on
    a
property-by-property
basis based on remaining lease terms, drilling results or future
    plans to develop acreage and records impairment expense for any
    decline in value. The assessment of unproved properties to
    determine any possible impairment requires managerial judgment.
Asset
    retirement obligations
In accordance with the Financial Accounting Standard
    Board's (FASB) authoritative guidance on asset retirement
    obligations, or ARO, we record the fair value of a liability for
    a legal obligation to retire an asset in the period in which the
    liability is incurred with the corresponding cost capitalized by
    increasing the carrying amount of the related long-lived asset.
    For oil and gas properties, this is the period in which the well
    is drilled or acquired. The ARO represents the estimated amount
    we will incur to plug, abandon and remediate the properties at
    the end of their productive lives, in accordance with applicable
    state laws. The liability is accreted to its present value each
    period and the capitalized cost is depreciated on the
unit-of-production
method. The accretion expense is recorded as a component of
    depreciation, depletion and amortization in our consolidated
    statement of operations.
We determine the ARO by calculating the present value of
    estimated cash flows related to the liability. Estimating the
    future ARO requires management to make estimates and judgments
    regarding timing, existence of a liability, as well as what
    constitutes adequate restoration. Inherent in the fair value
    calculation are numerous assumptions and judgments including the
    ultimate costs, inflation factors, credit adjusted discount
    rates, timing of settlement and changes in the legal,
    regulatory, environmental and political environments. To the
    extent future revisions to these assumptions impact the fair
    value of the existing ARO liability, a corresponding adjustment
    is made to the related asset.
Derivatives
We record all derivative instruments on the balance sheet as
    either assets or liabilities measured at their estimated fair
    value. We have not designated any derivative instruments as
    hedges for accounting purposes and we do not enter into such
    instruments for speculative trading purposes. Realized gains and
    realized losses from the settlement of commodity derivative
    instruments and unrealized gains and unrealized losses from
    valuation changes in the remaining unsettled commodity
    derivative instruments are reported under Other Income (Expense)
    in our consolidated statement of operations.
Recent
    accounting pronouncements
Fair Value.
In February 2010, the FASB
    enhanced existing authoritative guidance on certain disclosure
    requirements and added two new disclosure requirements related
    to fair value measurements. The guidance requires a gross
    presentation of activities within the Level 3 roll forward
    and adds a new requirement to disclose details of significant
    transfers in and out of Level 1 and 2 measurements and the
    reasons for the transfers. The new disclosures are required for
    all companies that are required to provide disclosures about
    recurring and nonrecurring fair value measurements, and is
    effective the first interim or annual reporting period beginning
    after December 15, 2009, except for the gross presentation
    of the Level 3 roll forward information, which is required
    for annual reporting periods beginning after December 15,
    2010 and for interim reporting periods within those years. We do
    not expect the adoption of this new guidance to have a
    significant impact on our financial position, cash flows or
    results of operations.
Oil and Gas Reporting Requirements.
In
    December 2008, the SEC released the final rule,
    "Modernization of Oil and Gas Reporting," which adopts
    revisions to the SEC's oil and gas reporting disclosure
    requirements. The disclosure requirements under this final rule
    require reporting of oil and gas reserves using the unweighted
    arithmetic average of the
first-day-of-the-month
price for the preceding twelve months rather than year-end
    prices, and the use of new technologies to determine proved
    reserves if those technologies have been demonstrated to result
    in reliable conclusions about reserves volumes. Companies are
    allowed, but not required, to disclose probable and possible
    reserves in SEC filings. In addition, companies are required to
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report the independence and qualifications of their reserves
    preparer or auditor and file reports when a third party is
    relied upon to prepare reserves estimates or conduct a reserves
    audit. In January 2010, the FASB issued authoritative guidance
    on oil and gas reserve estimation and disclosure, aligning their
    requirements with the SEC's final rule. We have presented
    and applied this new guidance for the year ended
    December 31, 2009 herein.
Disclosures about Derivative Instruments and Hedging
    Activities.
In March 2008, the FASB issued
    authoritative guidance related to disclosures about derivative
    instruments and hedging activities. Disclosures previously
    required only for the annual financial statements are now
    required in interim financial statements. This guidance is
    intended to improve financial reporting about derivative
    instruments and hedging activities by requiring companies to
    enhance disclosure about how these instruments and activities
    affect their financial position, performance and cash flows and
    to improve the transparency of the location and amounts of
    derivative instruments in a company's financial statements
    and how they are accounted for. This guidance was effective for
    us beginning January 1, 2009. The adoption of this guidance
    did not have a significant impact on our consolidated financial
    position, results of operations or cash flows.
Business Combinations.
In December 2007, the
    FASB revised the authoritative guidance for business
    combinations, extending its applicability to all transactions
    and other events in which one entity obtains control over one or
    more other businesses. The revised guidance broadens the fair
    value measurement and recognition of assets acquired,
    liabilities assumed and interests transferred as a result of
    business combinations and requires that acquisition-related
    costs incurred prior to the acquisition be expensed. The revised
    guidance also expands the definition of what qualifies as a
    business, and this expanded definition could include prospective
    oil and gas purchases. Additionally, this guidance expands the
    required disclosures to improve the financial statement
    users' abilities to evaluate the nature and financial
    effects of business combinations. The guidance is effective for
    business combinations for which the acquisition date is on or
    after January 1, 2009.
Internal
    Controls and Procedures
Prior to the completion of this offering, we have been a private
    company with limited accounting personnel to adequately execute
    our accounting processes and other supervisory resources with
    which to address our internal control over financial reporting.
    As such, we have not maintained an effective control environment
    in that the design and execution of our controls has not
    consistently resulted in effective review and supervision by
    individuals with financial reporting oversight roles. The lack
    of adequate staffing levels resulted in insufficient time spent
    on review and approval of certain information used to prepare
    our financial statements. We have concluded that these control
    deficiencies constitute a material weakness in our control
    environment. A material weakness is a control deficiency, or a
    combination of control deficiencies, in internal control over
    financial reporting, such that there is a reasonable possibility
    that a material misstatement of our annual or interim financial
    statements will not be prevented or detected on a timely basis.
    The control deficiencies described above, at varying degrees of
    severity, contributed to the material weaknesses in the control
    environment, as described below.
In 2007, we did not maintain effective controls to ensure that
    correct working interests were used in our calculations of asset
    retirement obligations and depreciation, depletion and
    amortization expense. In 2008, the lack of effective controls
    over the accuracy of working interests and the accurate clearing
    of asset retirement obligations resulted in the misstatement of
    our proved property impairment expense. In 2009, we did not
    maintain effective controls over the accuracy of key
    spreadsheets used in our computations of unproved property
    impairment expense. For each of those years, effective controls
    were not adequately designed or consistently operating to ensure
    that key computations were properly reviewed before the amounts
    were recorded in our accounting records. The above identified
    control deficiencies resulted in audit adjustments to our
    consolidated financial statements during 2007, 2008 and 2009.
Although remediation efforts are still in progress, management
    has taken steps to address the causes of the 2007 and 2008 audit
    adjustments by putting into place new accounting processes and
    control procedures. Management created a centralized source for
    working interests and implemented controls to ensure that
    working interests used in reserve report information and
    accounting computations are reconciled to the
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Table of Contents
centralized source of working interests. Management also
    implemented an account reconciliation and analysis process to
    ensure the correct recording of asset retirement obligations. In
    addition, management is in the process of evaluating the
    remediation steps needed to address the cause of the 2009 audit
    adjustment.
In January 2010, we hired a financial reporting manager and an
    operations accountant to allow for additional preparation and
    review time during our monthly accounting close process. During
    2010, we expect to implement a comprehensive review of our
    internal controls, including our overall control environment,
    and to formalize our review and approval processes.
While we have begun the process of evaluating our internal
    control over financial reporting, we are in the early phases of
    our review and will not complete our review until well after
    this offering is completed. We cannot predict the outcome of our
    review at this time. During the course of the review, we may
    identify additional control deficiencies of varying degrees of
    severity, in addition to the material weaknesses discussed
    above. Management has taken steps to improve our internal
    control over financial reporting, including the implementation
    of new accounting processes and control procedures and the
    identification of gaps in our skills base and expertise of the
    staff required to meet the financial reporting requirements of a
    public company.
We are not currently required to comply with the SEC's
    rules implementing Section 404 of the Sarbanes Oxley Act of
    2002, and are therefore not required to make a formal assessment
    of the effectiveness of our internal control over financial
    reporting for that purpose. Upon becoming a public company, we
    will be required to comply with the SEC's rules
    implementing Section 302 of the Sarbanes-Oxley Act of 2002,
    which will require our management to certify financial and other
    information in our quarterly and annual reports and provide an
    annual management report on the effectiveness of our internal
    control over financial reporting. We will not be required to
    make our first assessment of our internal control over financial
    reporting until the year following our first annual report
    required to be filed with the SEC. To comply with the
    requirements of being a public company, we will need to upgrade
    our systems, including information technology, implement
    additional financial and management controls, reporting systems
    and procedures and hire additional accounting, finance and legal
    staff.
Further, our independent registered public accounting firm is
    not yet required to formally attest to the effectiveness of our
    internal controls over financial reporting until the year
    following our first annual report required to be filed with the
    SEC. Once it is required to do so, our independent registered
    public accounting firm may issue a report that is adverse in the
    event it is not satisfied with the level at which our controls
    are documented, designed, operated or reviewed. Our remediation
    efforts may not enable us to remedy or avoid material weaknesses
    or significant deficiencies in the future.
Inflation
Inflation in the United States has been relatively low in recent
    years and did not have a material impact on our results of
    operations for the period from February 26, 2007 through
    December 31, 2007 and the years ended 2008 and 2009.
    Although the impact of inflation has been insignificant in
    recent years, it is still a factor in the United States economy
    and we tend to experience inflationary pressure on the cost of
    oilfield services and equipment as increasing oil and gas prices
    increase drilling activity in our areas of operations.
Quantitative
    and Qualitative Disclosures About Market Risk
We are exposed to a variety of market risks including commodity
    price risk, interest rate risk and counterparty and customer
    risk. We address these risks through a program of risk
    management including the use of derivative instruments.
Commodity price exposure.
We are exposed to
    market risk as the prices of oil and natural gas fluctuate as a
    result of changes in supply and demand and other factors. To
    partially reduce price risk caused by these market fluctuations,
    we have entered into derivative instruments in the past and
    expect to enter into derivative instruments in the future to
    cover a significant portion of our future production.
We utilize derivative financial instruments (primarily swaps and
    zero-cost collars) to manage risks related to changes in oil
    prices. As of December 31, 2009, we utilized fixed-price
    swap agreements and zero-cost
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Table of Contents
collar options, or Derivative Contracts, to reduce the
    volatility of oil prices on a significant portion of our future
    expected oil production.
For derivative instruments recorded at fair value, the credit
    standing of our counterparties is analyzed and factored into the
    fair value amounts recognized on the balance sheet.
The following is a summary of our Derivative Contracts as of
    December 31, 2009:
Total Notional
Average
Average
Derivative
Amount of Oil
Floor
Ceiling
Fair
Settlement Period
Instrument
(Barrels)
Price
Price
Fixed Price
Market Value
(In thousands)
2010
NYMEX Swap
11,163
$
72.25
$
(26
)
2010
NYMEX Collar
401,814
$
67.48
$
90.19
(841
)
2011
NYMEX Collar
186,764
61.49
82.23
(1,912
)
2012
NYMEX Collar
13,618
60.00
80.25
(174
)
$
(2,953
)
Interest rate risk.
At December 31, 2009,
    we had indebtedness outstanding under our prior revolving credit
    facility of $35.0 million, which bore interest at floating
    rates. The weighted average annual interest rate incurred on
    this indebtedness for the years ended December 31, 2009 and
    2008 and the period ended December 31, 2007 was
    approximately 3.5%, 6.3% and 7.8%, respectively. A 1.0% increase
    in each of the average LIBOR and federal funds rate for the year
    ended December 31, 2009 would have resulted in an estimated
    $0.2 million increase in interest expense for the year
    ended December 31, 2009.
We may utilize interest rate derivatives to alter interest rate
    exposure in an attempt to reduce interest rate expense related
    to existing debt issues. Interest rate derivatives are used
    solely to modify interest rate exposure and not to modify the
    overall leverage of the debt portfolio.
Counterparty and customer credit risk.
Joint
    interest receivables arise from billing entities which own
    partial interest in the wells we operate. These entities
    participate in our wells primarily based on their ownership in
    leases on which we wish to drill. We have limited ability to
    control participation in our wells. We are also subject to
    credit risk due to concentration of our oil and natural gas
    receivables with several significant customers. See
    "Business — Marketing and Major Customers"
    for further detail about our significant customers. We do not
    require our customers to post collateral. The inability or
    failure of our significant customers to meet their obligations
    to us or their insolvency or liquidation may adversely affect
    our financial results. In addition, our oil and natural gas
    derivative arrangements expose us to credit risk in the event of
    nonperformance by counterparties.
Off-Balance
    Sheet Arrangements
Currently, we do not have any off-balance sheet arrangements.
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BUSINESS
Overview
We are an independent exploration and production company focused
    on the acquisition and development of unconventional oil and
    natural gas resources. We have accumulated approximately
    292,000 net leasehold acres in the Williston Basin,
    approximately 85% of which are undeveloped. We are currently
    focused on exploiting what we have identified as significant
    resource potential from the Bakken and Three Forks formations,
    which are present across a substantial majority of our acreage.
    A report issued by the United States Geologic Survey, or USGS,
    in April 2008 classified these formations as the largest
    continuous oil accumulation ever assessed by it in the
    contiguous United States, with approximately 3.65 billion
    barrels of technically recoverable oil resources. We believe the
    location, size and concentration of our acreage creates an
    opportunity for us to achieve cost, recovery and production
    efficiencies through the large-scale development of our project
    inventory. Our management team has a proven track record in
    identifying, acquiring and executing large, repeatable
    development drilling programs, which we refer to as
    "resource conversion" opportunities, and has
    substantial experience in the Williston Basin. We have built our
    leasehold acreage position in the Williston Basin primarily
    through acquisitions in our three primary project areas, West
    Williston, East Nesson and Sanish. For a description of our
    acquisition activity, please see "—Our Acquisition
    History" below.
DeGolyer and MacNaughton, our independent reserve engineers,
    estimated our net proved reserves to be 13.3 MMBoe as of
    December 31, 2009, 42% of which were classified as proved
    developed and 93% of which were comprised of oil. The following
    table presents summary data for each of our primary project
    areas as of December 31, 2009:
2010 Budget
Average
Identified Drilling
Drilling
Estimated Net
Daily
Net
Locations
Gross
Net
Capex
Proved Reserves
Production
Acreage
Gross
Net
Wells
Wells
(In millions)
MMBoe
% Developed
(Boe/d)(1)
Williston Basin
West Williston(2)
159,491
268
106.5
41
18.8
$
110
5.0
55
%
1,106
East Nesson(2)
124,004
113
57.0
13
7.4
47
3.9
36
%
1,016
Sanish(3)
8,747
88
9.6
37
3.8
22
4.3
32
%
792
Total Williston Basin
292,242
469
173.1
91
30.0
$
179
13.2
42
%
2,914
Other
879
—
—
—
—
—
0.1
100
%
159
Total
293,121
469
173.1
91
30.0
$
179
13.3
42
%
3,073
(1)
Represents average daily production for the three months ended
    December 31, 2009.
(2)
Identified gross and net drilling locations in our West
    Williston and East Nesson project areas are primarily comprised
    of Bakken wells based on 1,280-acre spacing and do not include
    any infill wells targeting the Bakken formation or any primary
    or infill wells targeting the Three Forks formation.
(3)
Identified gross and net drilling locations in our Sanish
    project area include a single Bakken infill well per 1,280-acre
    or
640-acre
spacing unit (excluding spacing units already containing two
    Bakken producing wells) and include 10 gross (1.6 net)
    primary wells targeting the Three Forks formation.
In our West Williston and East Nesson project areas, we have an
    inventory of approximately 381 gross primary drilling
    locations (23 of which are proved undeveloped), substantially
    all of which are on 1,280-acre spacing targeting the Bakken
    formation. We plan to aggressively develop these specifically
    identified drilling locations using horizontal drilling and
    multi-stage fracture stimulation techniques. In our Sanish
    project area, we have an additional 88 gross non-operated
    drilling locations (63 of which are proved undeveloped). A
    single additional infill well per spacing unit targeting the
    Bakken formation across all three of our Williston Basin project
    areas would add over 500 incremental potential drilling
    locations. We are also evaluating the resource potential in the
    Three Forks formation across our leasehold position and believe
    there may be a significant number of additional potential
    drilling locations targeting this formation.
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Our total 2010 capital expenditure budget is $220 million,
    which consists of:
•
$134 million for drilling and completing operated wells;
•
$45 million for drilling and completing non-operated wells;
•
$15 million for maintaining and expanding our leasehold
    position;
•
$5 million for constructing infrastructure to support
    production in our core project areas; and
•
$21 million in unallocated funds which are available for
    additional drilling and leasing costs and activity.
While we have budgeted $220 million for these purposes, the
    ultimate amount of capital we will expend may fluctuate
    materially based on market conditions and the success of our
    drilling results as the year progresses. Please see
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations — Liquidity and
    Capital Resources."
Our
    Acquisition History
We built our leasehold position in our West Williston, East
    Nesson and Sanish project areas through the following
    acquisitions and development activities:
•
In June 2007, we acquired approximately 175,000 net
    leasehold acres in the Williston Basin with then-current net
    production of approximately 1,000 Boe/d. This acreage is the
    core of our West Williston project area.
•
In May 2008, we entered into a farm-in and purchase arrangement,
    under which we earned or acquired approximately 48,000 net
    leasehold acres, establishing our initial position in the East
    Nesson project area.
•
In June 2009, we acquired approximately 40,000 net
    leasehold acres with then-current net production of
    approximately 800 Boe/d, approximately 83% of which was from the
    Williston Basin. This acquisition consolidated our acreage in
    the East Nesson project area and established our Sanish project
    area.
•
In September 2009, we acquired an additional 46,000 net
    leasehold acres with then-current net production of
    approximately 300 Boe/d. This acquisition further consolidated
    our acreage in the East Nesson project area.
Our
    Business Strategy
Our goal is to increase stockholder value by building reserves,
    production and cash flows at an attractive return on invested
    capital. We seek to achieve our goals through the following
    strategies:
•
Aggressively Develop our Williston Basin Leasehold
    Position.
We intend to aggressively drill and
    develop our acreage position to maximize the value of our
    resource potential. The aggregate 469 gross drilling
    locations that we have specifically identified in the Bakken
    formation in our three project areas will be our primary targets
    in the near term. Our 2010 drilling plan contemplates drilling
    approximately 35 gross (22.4 net) operated wells in these
    project areas by using two operated drilling rigs for the full
    year and adding up to three additional drilling rigs later in
    the year. Subject to market conditions and rig availability, we
    expect to operate five drilling rigs in 2011, which could enable
    us to drill as many as 60 gross operated wells during that
    year. We believe we have the ability to add additional rigs this
    year if market conditions and program results warrant.
•
Enhance Returns by Focusing on Operational and Cost
    Efficiencies.
Our management team is focused on
    continuous improvement of our operating measures and has
    significant experience in successfully converting early-stage
    resource opportunities into cost-efficient development projects.
    We believe the magnitude and concentration of our acreage within
    our project areas provides us with the opportunity to capture
    economies of scale, including the ability to drill multiple
    wells from a single drilling pad, utilizing centralized
    production and fluid handling facilities and reducing the time
    and cost of rig mobilization.
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•
Adopt and Employ Leading Drilling and Completion
    Techniques.
Our team is focused on enhancing our
    drilling and completion techniques to maximize recovery. We
    believe these techniques have significantly evolved over the
    last several years, resulting in increased initial production
    rates and recoverable hydrocarbons per well through the
    implementation of techniques such as using longer laterals and
    more tightly spaced fracturing stimulation stages. We
    continuously evaluate our internal drilling results and monitor
    the results of other operators to improve our operating
    practices, and we expect our drilling and completion techniques
    will continue to evolve. This continued evolution may
    significantly enhance our initial production rates, ultimate
    recovery factors and rate of return on invested capital.
•
Pursue Strategic Acquisitions with Significant Resource
    Potential.
In the near term, we intend to
    identify and acquire additional acreage and producing assets in
    the Williston Basin to supplement our existing operations. Going
    forward, we expect to selectively target additional domestic
    basins that would allow us to employ our resource conversion
    strategy on large undeveloped acreage positions similar to what
    we have accumulated in the Williston Basin. While we have no
    current intention to pursue international opportunities, our
    management team has significant international acquisition and
    operating expertise. If we identify an international opportunity
    with appropriate scale, risk and resource conversion potential,
    our board of directors may approve such an investment should
    they determine it is in the long-term best interest of our
    stockholders to do so.
Our
    Competitive Strengths
We have a number of competitive strengths that we believe will
    help us to successfully execute our business strategies:
•
Substantial Leasehold Position in one of North America's
    Leading Unconventional Oil-Resource Plays.
Our
    current leasehold position of approximately 292,000 net
    leasehold acres in the Williston Basin is highly prospective in
    the Bakken formation. We believe our Williston Basin acreage is
    one of the largest concentrated leasehold positions in the
    basin, and much of our acreage is in areas of significant
    drilling activity by other exploration and production companies.
    While we are initially targeting the Bakken formation, we are
    also evaluating what we believe to be significant prospectivity
    in the Three Forks formation which underlies a large portion of
    our acreage. We expect that the scale and concentration of our
    acreage will enable us to continue to improve our drilling and
    completion costs and operational efficiency.
•
Large, Multi-Year Project Inventory.
We have
    an inventory of approximately 469 gross drilling locations,
    primarily targeting the Bakken formation. We plan to drill
    35 gross (22.4 net) operated wells across our West
    Williston and East Nesson project areas in 2010, the completion
    of which would represent 14% of our 246 gross identified
    operated drilling locations in these two project areas. We may
    be able to enhance the total recovery from the Bakken formation
    by drilling potential infill locations. In addition, our total
    number of drilling locations may also be substantially increased
    by pursuing the prospectivity we have identified in the Three
    Forks formation.
•
Management Team with Proven Acquisition and Operating
    Skills.
Our senior management team has extensive
    expertise in the oil and gas industry as previous members of
    management at Burlington Resources. The senior technical team
    has an average of more than 25 years of industry
    experience, including experience in multiple North American
    resource plays as well as experience in other North American and
    international basins. We believe our management and technical
    team is one of our principal competitive strengths relative to
    our industry peers due to our team's proven track record in
    identification, acquisition and execution of resource conversion
    opportunities. In addition, this team possesses substantial
    expertise in horizontal drilling techniques and managing and
    acquiring large development programs, and also has prior
    experience in the Williston Basin.
•
Incentivized Management Team.
Our management
    team will own a significant direct ownership interest in us
    immediately following the completion of this offering. In
    addition, our management team will own an indirect interest in
    OAS Holdco, which will
    own      shares of our common
    stock upon
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completion of this offering. Our management team may
    significantly increase its sharing percentage in the shares held
    by OAS Holdco by increasing the return on investment for the
    other members of OAS Holdco. We believe our management
    team's direct ownership interest immediately following the
    offering as well as their ability to increase their interest
    over time through OAS Holdco provides significant incentives to
    grow the value of our business for the benefit of all
    stockholders. See "Corporate Reorganization — LLC
    Agreement of OAS Holdco."
•
Operating Control over the Majority of our
    Portfolio.
In order to maintain better control
    over our asset portfolio, we have established a leasehold
    position comprised primarily of properties that we expect to
    operate. Controlling operations will allow us to dictate the
    pace of development as well as the costs, type and timing of
    exploration and development activities. We believe that
    maintaining operational control over the majority of our acreage
    will allow us to better pursue our strategies of enhancing
    returns through operational and cost efficiencies and maximizing
    hydrocarbon recovery through continuous improvement of drilling
    and completion techniques.
Recent
    Developments
Drilling Activity.
Since December 31,
    2009, we have drilled four operated wells in the Bakken
    formation, each of which is being completed. Additionally, we
    currently have one operated drilling rig in the West Williston
    project area and another in the East Nesson project area, each
    of which is drilling a well targeting the Bakken formation. Of
    the 16 gross (1.6 net) non-operated wells in progress
    on December 31, 2009, 9 gross (0.7 net) wells
    have initiated production and 7 gross (0.9 net) wells
    are under completion operations.  Subsequent to
    December 31, 2009, an additional 14 gross
    (0.9 net) non-operated wells have begun operations and are
    being drilled or completed.
Amended and Restated Credit Facility.
On
    February 26, 2010, we entered into an amended and restated
    revolving credit facility, which will have a borrowing base of
    $70 million upon completion of this offering. Borrowings
    under our revolving credit facility accrue interest at an
    initial rate of 4.0% per annum. Our revolving credit facility
    matures on February 26, 2014. Please see
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations — Liquidity and
    Capital Resources — Reserve-based credit
    facility." As of March 1, 2010, we had
    $13.0 million of indebtedness outstanding under our
    revolving credit facility. We anticipate that a portion of the
    net proceeds from this offering will be used to repay all of our
    borrowings outstanding as of the closing.
Marketing
    and Transportation
The Williston Basin crude oil transportation and refining
    infrastructure has grown substantially in recent years, largely
    in response to drilling activity in the Bakken formation. As of
    February 15, 2010, there was approximately
    334,600 barrels per day of crude oil transportation and
    refining capacity in the Williston Basin, comprised of
    276,600 barrels per day of pipeline transportation capacity
    and 58,000 barrels per day of refining capacity at the
    Tesoro Corporation Mandan refinery. In addition,
    60,000 barrels per day of specifically dedicated railcar
    transportation capacity has recently been placed into service in
    the Williston Basin. Based on publicly announced expansion
    projects, pipeline transportation capacity for Williston Basin
    oil production could increase by 30,000 to 115,000 barrels
    per day by 2013, and we believe additional projects are under
    consideration. For a discussion of the potential risks to our
    business that could result from transportation and refining
    infrastructure constraints in the Williston Basin, please see
    "Risk Factors — Delays and interruptions of
    production from our wells due to marketing and transportation
    constraints in the Williston Basin could cause significant
    fluctuations in our realized oil and natural gas prices."
Our
    Operations
Estimated
    proved reserves
Unless otherwise specifically identified in this prospectus, the
    summary data with respect to our estimated proved reserves
    presented below has been prepared by our independent reserve
    engineering firms in accordance with rules and regulations of
    the SEC applicable to companies involved in oil and natural gas
61
Table of Contents
producing activities. As discussed below, the SEC has adopted
    new rules relating to disclosures of estimated reserves that are
    effective for fiscal years ending on or after December 31,
    2009. In this prospectus, proved reserve estimates do not
    include any value for probable or possible reserves which may
    exist, categories which the new SEC rules would for the first
    time permit us to disclose in public reports. Our estimated
    proved reserves under the SEC rules in effect for the years
    ended December 31, 2007 and 2008 were determined using
    constant prices and unescalated costs based on the prices
    received and costs incurred on a
field-by-field
basis as of the year end. For the year ended December 31,
    2009 and for future periods, our estimated proved reserves are
    determined using the preceding twelve months' unweighted
    arithmetic average of the
first-day-of-the-month
prices, rather than year-end prices. For a definition of proved
    reserves under the SEC rules for both the fiscal years ending on
    or after December 31, 2009 and the fiscal years ending
    prior to December 31, 2009, see the "Glossary of Oil
    and Natural Gas Terms" beginning on
page A-1
of this prospectus. For more information regarding our
    independent reserve engineers, please see
    "— Independent petroleum engineers" below.
The table below summarizes our estimated proved reserves and
    related
PV-10
at
    December 31, 2008 for each of our core operating areas as
    prepared consistent with the SEC's rules regarding natural
    gas and oil reserve reporting in effect for fiscal years ending
    prior to December 31, 2009. The table also summarizes our
    estimated proved reserves and related
PV-10
at
    December 31, 2009 for each of our project areas as prepared
    consistent with our and our independent reserve engineers'
    interpretation of the SEC's new rules. The SEC's new
    rules relating to disclosures of estimated oil and natural gas
    reserves are effective for fiscal years ending on or after
    December 31, 2009. These new rules require SEC reporting
    companies to prepare their reserve estimates using revised
    reserve definitions and revised pricing based on
12-month
historical unweighted
first-day-of-the-month
average prices.
The reserve estimates at December 31, 2009 presented in the
    table below are based on a report prepared by DeGolyer and
    MacNaughton, independent reserve engineers. In preparing its
    report, DeGolyer and MacNaughton evaluated properties
    representing all of our
PV-10
at
    December 31, 2009 under the new SEC rules. The reserve
    estimates at December 31, 2008 presented in the table below
    are based on reports prepared by W.D. Von Gonten &
    Co., independent reserve engineers. In preparing its report,
    W.D. Von Gonten & Co. evaluated properties
    representing all of our
PV-10
at
    December 31, 2008 using the SEC rules in effect at the time
    of the report. For more information regarding our independent
    reserve engineers, please see "— Independent
    petroleum engineers" below. The information in the
    following table does not give any effect to or reflect our
    commodity hedges.
At December 31, 2008
At December 31, 2009
Proved Reserves
PV-10(1)
Proved Reserves
PV-10
Project Area
(MMBoe)
(in millions)
(MMBoe)
(in millions)
Williston Basin
West Williston
2.2
$
16.4
5.0
$
50.7
East Nesson
0.1
1.3
3.9
31.6
Sanish
—
—
4.3
50.6
Total Williston Basin
2.3
$
17.7
13.2
$
132.9
Other(2)
—
—
0.1
0.6
Total
2.3
$
17.7
13.3
$
133.5
(1)
The
PV-10
amount included in the report of W.D. Von Gonten & Co.
    at December 31, 2008 was $19.2 million because such
    amount does not give effect to additional estimated plugging and
    abandonment costs.
(2)
Represents data relating to our properties in the Barnett shale.
Estimated proved reserves at December 31, 2009 were
    13.3 MMBoe, with a
PV-10
of
    $133.5 million. Our estimated proved reserves at
    December 31, 2009 increased 11.0 MMBoe and
PV-10
increased $115.8 million over our estimated proved reserves
    and
PV-10
at
    December 31, 2008 due to the results of our drilling
    program, acquisitions and a higher oil price assumption at
    December 31, 2009.
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The following table sets forth more information regarding our
    estimated proved reserves at December 31, 2007, 2008 and
    2009:
At December 31,
2007
2008
2009
Estimated proved reserves(1):
Oil (MMBbls)
4.0
2.2
12.4
Natural gas (Bcf)
1.2
0.7
5.3
Total estimated proved reserves (MMBoe)
4.3
2.3
13.3
Proved developed (MMBoe)
3.4
2.3
5.6
Percent developed
81
%
100
%
42
%
Proved undeveloped (MMBoe)
0.8
—
7.7
PV-10
(in
    millions)(2)
$
121.8
$
17.7
$
133.5
Standardized Measure (in millions)(3)
121.8
17.7
133.5
(1)
Our estimated proved reserves and related future net revenues,
PV-10
and
    Standardized Measure were determined using index prices for oil
    and natural gas, without giving effect to derivative
    transactions, and were held constant throughout the life of the
    properties. The index prices were $96.00/Bbl for oil and
    $7.16/MMBtu for natural gas at December 31, 2007, and $44.60/Bbl
    for oil and $5.63/MMBtu for natural gas at December 31, 2008,
    and the unweighted arithmetic average first-day-of-the-month
    prices for the prior 12 months were $61.04/Bbl for oil and
    $3.87/MMBtu for natural gas at December 31, 2009. These prices
    were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead.
(2)
PV-10
is a
    non-GAAP financial measure and generally differs from
    Standardized Measure, the most directly comparable GAAP
    financial measure, because it does not include the effects of
    income taxes on future net revenues. However, our
PV-10
and
    our Standardized Measure are equivalent because as of
    December 31, 2009, we were a limited liability company not
    subject to entity level taxation. Accordingly, no provision for
    federal or state corporate income taxes has been provided
    because taxable income is passed through to our equity holders.
    However, in connection with the closing of this offering, we
    will merge into a corporation that will become a holding company
    for Oasis Petroleum LLC. As a result, we will be treated as a
    taxable entity for federal income tax purposes. Neither
PV-10
nor
    Standardized Measure represents an estimate of the fair market
    value of our oil and natural gas properties. We and others in
    the industry use
PV-10
as a
    measure to compare the relative size and value of proved
    reserves held by companies without regard to the specific tax
    characteristics of such entities. The PV-10 amounts included in
    the reports of W.D. Von Gonten & Co. at December 31, 2007
    and at December 31, 2008 were $122.9 million and $19.2 million,
    respectively, because the PV-10 amounts included in such reports
    do not give effect to additional estimated plugging and
    abandonment costs.
(3)
Standardized Measure represents the present value of estimated
    future net cash inflows from proved oil and natural gas
    reserves, less estimated future development, production,
    plugging and abandonment costs and income tax expenses (if
    applicable), discounted at 10% per annum to reflect timing of
    future cash flows. In connection with the closing of this
    offering, we will merge into a corporation that will be treated
    as a taxable entity for federal income tax purposes. Future
    calculation of Standardized Measure will include the effects of
    income taxes on future net revenues. For further discussion of
    income taxes, see "Management's Discussion and
    Analysis of Financial Condition and Results of Operations."
Estimated proved reserves at December 31, 2009 were
    13.3 MMBoe, a 477% increase from reserves of 2.3 MMBoe
    at December 31, 2008. Our 2009 estimated proved reserves
    increased 11.0 MMBoe over our 2008 estimated reserves due
    to acquisitions, our drilling program and higher oil price
    assumptions at December 31, 2009. Our commodity price
    assumption for oil increased $16.44 per Bbl to $61.04 per
    Bbl for the year ended December 31, 2009 from $44.60 per
    Bbl for the year ended December 31, 2008. Our proved
    developed producing reserves increased 3.3 MMBoe or 144% to
    5.6 MMBoe for the year ended December 31, 2009 from
    2.3 MMBoe for the year ended December 31, 2008 due to
    acquisitions and our drilling program. Our
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proved undeveloped reserves increased to 7.7 MMBoe for the
    year ended December 31, 2009 from 0.0 MMBoe for the
    year ended December 31, 2008 due to significant regional
    drilling activity, higher commodity price assumptions and higher
    overall estimated ultimate recoveries using recent drilling and
    completion techniques.
Estimated proved reserves at December 31, 2008 were
    2.3 MMBoe, a 47% decrease from reserves of 4.3 MMBoe
    at December 31, 2007. Our estimated proved reserves
    decreased 2.0 MMBoe for the year ended December 31,
    2008 from December 31, 2007 due primarily to lower
    commodity price assumptions. Our commodity price assumption for
    oil decreased $51.40 per Bbl to $44.60 per Bbl at
    December 31, 2008 from $96.00 per Bbl at December 31,
    2007. Our proved developed producing reserves decreased
    0.9 MMBoe or 28% to 2.3 MMBoe at December 31,
    2008 from 3.2 MMBoe at December 31, 2007 due to
    commodity price assumption and production. Our proved
    undeveloped reserves decreased from 0.8 MMBoe at
    December 31, 2007 to no proved undeveloped reserves at
    December 31, 2008 due to the effect of lower commodity
    price assumptions and drilling results in conventional
    reservoirs.
The
PV-10
of
    our estimated proved reserves at December 31, 2009 was
    $133.5 million, a 653% increase from
PV-10
of
    $17.7 million at December 31, 2008. Our
PV-10
of
    estimated proved reserves increased $115.8 million over the
    2008
PV-10
due to an increase in reserves and higher oil price assumptions.
The following table sets forth the estimated future net
    revenues, excluding derivatives contracts, from proved reserves,
    the present value of those net revenues
(PV-10),
and
    the expected benchmark prices used in projecting net revenues at
    December 31, 2007, 2008 and 2009 (in millions):
At December 31,
2007
2008
2009
Future net revenues
$
227.8
$
27.1
$
286.1
Present value of future net revenues:
Before income tax
(PV-10)
121.8
17.7
133.5
After income tax (Standardized Measure)
121.8
17.7
133.5
Benchmark oil price(1)($/Bbl)
$
96.00
$
44.60
$
61.04
(1)
Our estimated proved reserves and related future net revenues,
PV-10
and
    Standardized Measure were determined using index prices for oil
    and natural gas, without giving effect to derivative
    transactions, and were held constant throughout the life of the
    properties. The index prices were $96.00/Bbl for oil and
    $7.16/MMBtu for natural gas at December 31, 2007, and
    $44.60/Bbl for oil and $5.63/MMBtu for natural gas at
    December 31, 2008, and the unweighted arithmetic average
first-day-of-the-month
prices for the prior 12 months were $61.04/Bbl for oil and
    $3.87/MMBtu for natural gas at December 31, 2009.  These
    prices were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead. The
    PV-10 amounts included in the reports of W.D. Von Gonten &
    Co. at December 31, 2007 and at December 31, 2008 were $122.9
    million and $19.2 million, respectively, because the PV-10
    amounts included in such reports do not give effect to
    additional estimated plugging and abandonment costs.
Future net revenues represent projected revenues from the sale
    of proved reserves net of production and development costs
    (including operating expenses and production taxes). Such
    calculations at December 31, 2007 and 2008 are based on
    costs and prices in effect at December 31 of each year, without
    giving effect to derivative transactions, and are held constant
    throughout the life of the properties. Such calculations at
    December 31, 2009 are based on costs in effect at
    December 31, 2009 and the
12-month
unweighted arithmetic average of the
first-day-of-the-month
price for the period January 2009 through December 2009, without
    giving effect to derivative transactions, and are held constant
    throughout the life of the properties. There can be no assurance
    that the proved reserves will be produced within the periods
    indicated or that prices and costs will remain constant. There
    are numerous uncertainties inherent in estimating reserves and
    related information and different reservoir engineers often
    arrive at different estimates for the same properties.
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Independent
    petroleum engineers
Our estimated reserves and related future net revenues and
PV-10
at
    December 31, 2009 are based on a report prepared by
    DeGolyer and MacNaughton, our independent reserve engineers, in
    accordance with generally accepted petroleum engineering and
    evaluation principles and definitions and current guidelines
    established by the SEC. A copy of this report has been filed as
    an exhibit to the registration statement containing this
    prospectus. DeGolyer and MacNaughton is a Delaware corporation
    with offices in Dallas, Houston, Calgary and Moscow. The
    firm's more than 100 professionals include engineers,
    geologists, geophysicists, petrophysicists, and economists
    engaged in the appraisal of oil and gas properties, evaluation
    of hydrocarbon and other mineral prospects, basin evaluations,
    comprehensive field studies, and equity studies related to the
    domestic and international energy industry. These services have
    been provided for over 70 years. DeGolyer and MacNaughton
    restricts its activities exclusively to consultation; it does
    not accept contingency fees, nor does it own operating interests
    in any oil, gas, or mineral properties, or securities or notes
    of clients. The firm subscribes to a code of professional
    conduct, and its employees actively support their related
    technical and professional societies. The firm is a Texas
    Registered Engineering Firm.
Our estimated reserves and related future net revenues and
PV-10
at
    December 31, 2007 and 2008 are based on reports prepared by
    W.D. Von Gonten & Co., our independent reserve
    engineers at such dates, in accordance with generally accepted
    petroleum engineering and evaluation principles and definitions
    and guidelines established by the SEC in effect at such time. A
    copy of these reports have been filed as exhibits to the
    registration statement containing this prospectus. W.D. Von
    Gonten & Co. was formed in 1995 and is located in Houston,
    Texas. The firm has a professional staff consisting of thirteen
    petroleum engineers and three geophysicists and geologists, as
    well as a financial analyst and additional technical support.
    W.D. Von Gonten & Co. provides a variety of services to the
    oil and gas industry, including field studies, oil and gas
    reserve estimations, appraisals of oil and gas properties and
    reserve reports for both public and private companies. W.D. Von
    Gonten & Co. is a Texas Registered Engineering Firm.
Technology
    used to establish proved reserves
Under the new SEC rules, proved reserves are those quantities of
    oil and natural gas, which, by analysis of geoscience and
    engineering data, can be estimated with reasonable certainty to
    be economically producible from a given date forward, from known
    reservoirs, and under existing economic conditions, operating
    methods, and government regulations. The term "reasonable
    certainty" implies a high degree of confidence that the
    quantities of oil
and/or
natural gas actually recovered will equal or exceed the
    estimate. Reasonable certainty can be established using
    techniques that have been proved effective by actual production
    from projects in the same reservoir or an analogous reservoir or
    by other evidence using reliable technology that establishes
    reasonable certainty. Reliable technology is a grouping of one
    or more technologies (including computational methods) that has
    been field tested and has been demonstrated to provide
    reasonably certain results with consistency and repeatability in
    the formation being evaluated or in an analogous formation.
In order to establish reasonable certainty with respect to our
    estimated proved reserves, DeGolyer and MacNaughton employed
    technologies that have been demonstrated to yield results with
    consistency and repeatability. The technologies and economic
    data used in the estimation of our proved reserves include, but
    are not limited to, electrical logs, radioactivity logs, core
    analyses, geologic maps and available downhole and production
    data, seismic data and well test data.
Internal
    controls over reserves estimation process
We maintain an internal staff of petroleum engineers and
    geoscience professionals who work closely with our independent
    reserve engineers to ensure the integrity, accuracy and
    timeliness of data furnished to our independent reserve
    engineers in their reserves estimation process. Our Senior Vice
    President Asset Management is the technical person primarily
    responsible for overseeing the preparation of our reserves
    estimates. Our Senior Vice President Asset Management has over
    20 years of industry experience with positions of
    increasing responsibility in engineering and evaluations and
    holds both a Bachelor of Science
65
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degree and Master of Science degree in petroleum engineering.
    Our Senior Vice President Asset Management reports directly to
    our Chief Operating Officer.
Throughout each fiscal year, our technical team meets with
    representatives of our independent reserve engineers to review
    properties and discuss methods and assumptions used in
    preparation of the proved reserves estimates. While we have no
    formal committee specifically designated to review reserves
    reporting and the reserves estimation process, a preliminary
    copy of the reserve report is reviewed by our Chief Operating
    Officer with representatives of our independent reserve
    engineers and internal technical staff. Following the
    consummation of this offering, we anticipate that our audit
    committee will conduct a similar review on an annual basis.
Production,
    revenues and price history
Oil and natural gas are commodities. The price that we receive
    for the oil and natural gas we produce is largely a function of
    market supply and demand. Demand for oil and natural gas in the
    United States has increased dramatically during this decade.
    However, the current economic slowdown reduced this demand
    during the second half of 2008 and through 2009. Demand is
    impacted by general economic conditions, weather and other
    seasonal conditions, including hurricanes and tropical storms.
    Over or under supply of oil or natural gas can result in
    substantial price volatility. Historically, commodity prices
    have been volatile and we expect that volatility to continue in
    the future. A substantial or extended decline in oil or natural
    gas prices or poor drilling results could have a material
    adverse effect on our financial position, results of operations,
    cash flows, quantities of oil and natural gas reserves that may
    be economically produced and our ability to access capital
    markets.
The following table sets forth information regarding oil and
    natural gas production, revenues and realized prices and
    production costs for the period from February 26, 2007
    through December 31, 2007 and for the years ended
    December 31, 2008 and 2009. For additional information on
    price calculations, see information set forth in
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operation."
Period from
February 26, 2007
Year Ended
(Inception) through
December 31,
December 31, 2007(1)
2008
2009
Operating data:
Net production volumes:
Oil (MBbls)
159
379
658
Natural gas (MMcf)
73
123
326
Oil equivalents (MBoe)
171
400
712
Average daily production (Boe/d)
929
1,092
1,950
Average sales prices:
Oil, without realized derivatives (per Bbl)
$
83.96
$
88.07
$
55.32
Oil, with realized derivatives(2) (per Bbl)
77.27
69.79
58.82
Natural gas (per Mcf)
6.25
10.91
4.24
Costs and expenses (per Boe):
Lease operating expenses
$
17.23
$
17.70
$
12.21
Production taxes
7.08
7.51
5.35
Depreciation, depletion and amortization
24.47
21.73
23.42
General and administrative expenses
18.60
13.64
13.12
(1)
For the period from February 26, 2007 through June 30,
    2007, we did not engage in oil and gas operating or producing
    activities. Average daily production includes production from
    July 1, 2007 through December 31, 2007.
(2)
Realized prices include realized gains or losses on cash
    settlements for our commodity derivatives, which do not qualify
    for hedge accounting.
Net production volumes for the year ended December 31, 2009
    were 712 MBoe, a 78% increase from net production of
    400 MBoe for 2008. Our net production volumes increased
    312 MBoe over 2008 net production
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volumes due to acquisitions and a successful operated and
    non-operated drilling and completion program. Our average oil
    sales prices, without the effect of realized derivatives,
    decreased $32.75 per Bbl to $55.32 per Bbl for the year ended
    December 31, 2009 from $88.07 per Bbl for the year ended
    December 31, 2008. Giving effect to our derivative
    transactions in both periods, our oil prices decreased only
    $10.97 per Bbl to $58.82 per Bbl for the year ended
    December 31, 2009 from $69.79 per Bbl for the year ended
    December 31, 2008. Our lease operating expenses decreased
    $5.49 per Boe, or 31%, to $12.21 per Boe for the year ended
    December 31, 2009 from $17.70 per Boe for the year ended
    December 31, 2008 due to acquisitions and our drilling
    program. The Bakken formation generally has a lower per unit
    lease operating cost than our conventional producing horizons.
Net production volumes for the year ended December 31, 2008
    were 400 MBoe, a 134% increase from net production of
    171 MBoe for the period from February 26, 2007 through
    December 31, 2007. Our 2008 net production volumes
    increased 229 MBoe over the 2007 net production
    volumes due to the initiation of our production activities on
    July 1, 2007. Our average oil sales prices, without the
    effect of realized derivatives, increased $4.11 per Bbl to
    $88.07 per Bbl for the year ended December 31, 2008 from
    $83.96 per Bbl for the period from February 26, 2007
    through December 31, 2007. Giving effect to our derivative
    transactions in both periods, our oil prices decreased $7.48 per
    Bbl to $69.79 per Bbl for the year ended December 31, 2008
    from $77.27 per Bbl for the period from February 26, 2007
    through December 31, 2007. Our lease operating expenses
    increased $0.47 per Boe or 3% to $17.70 per Boe for the year
    ended December 31, 2008 from $17.23 per Boe for the period
    from February 26, 2007 through December 31, 2007 due
    to limited drilling program activities, rising operating costs
    and decreasing production per well.
The following table sets forth information regarding our average
    daily production during the three months ended December 31,
    2009:
Average Daily Production for the
Three Months Ended December 31, 2009
Bbls
Mcf
Boe
Williston Basin:
West Williston
1,036
420
1,106
East Nesson
1,005
65
1,016
Sanish
751
249
792
Total Williston Basin
2,792
734
2,914
Other
16
857
159
Total
2,808
1,591
3,073
Productive
    wells
The following table presents the total gross and net productive
    wells by project area and by oil or gas completion as of
    December 31, 2009:
Oil Wells
Natural Gas Wells
Total Wells
Gross
Net
Gross
Net
Gross
Net
Williston Basin:
West Williston
130
45.5
—
—
130
45.5
East Nesson
43
19.0
—
—
43
19.0
Sanish
62
5.1
—
—
62
5.1
Total Williston Basin
235
69.6
—
—
235
69.6
Other
—
—
25
3.2
25
3.2
Total
235
69.6
25
3.2
260
72.8
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Gross wells are the number of wells in which a working interest
    is owned and net wells are the total of our fractional working
    interests owned in gross wells.
Acreage
The following table sets forth certain information regarding the
    developed and undeveloped acreage in which we own a working
    interest as of December 31, 2009 for each of our project
    areas. Acreage related to royalty, overriding royalty and other
    similar interests is excluded from this summary.
Developed Acres
Undeveloped Acres
Total Acres
Gross
Net
Gross
Net
Gross
Net
Williston Basin
West Williston
31,305
19,482
214,417
140,009
245,722
159,491
East Nesson
26,361
16,969
176,430
107,035
202,791
124,004
Sanish
38,598
7,862
5,433
885
44,031
8,747
Total Williston Basin
96,264
44,313
396,280
247,929
492,544
292,242
Other
5,917
879
—
—
5,917
879
Total
102,181
45,192
396,280
247,929
498,461
293,121
Undeveloped
    acreage expirations
The following table sets forth the number of gross and net
    undeveloped acres as of December 31, 2009 that will expire
    over the next three years by project area unless production is
    established within the spacing units covering the acreage prior
    to the expiration dates:
Expiring 2010
Expiring 2011
Expiring 2012
Gross
Net
Gross
Net
Gross
Net
Williston Basin
West Williston
38,276
11,228
92,191
48,222
51,575
21,254
East Nesson
68,874
34,302
33,372
11,272
25,693
10,367
Sanish
1,038
110
1,154
65
120
21
Total Williston Basin
108,188
45,640
126,717
59,559
77,388
31,642
Other
—
—
—
—
—
—
Total
108,188
45,640
126,717
59,559
77,388
31,642
Many of the leases comprising the acreage set forth in the table
    above will expire at the end of their respective primary terms
    unless production from the leasehold acreage has been
    established prior to such date, in which event the lease will
    remain in effect until the cessation of production in commercial
    quantities. While we may attempt to secure a new lease upon the
    expiration of certain of our acreage, there are some third-party
    leases that may become effective immediately if our leases
    expire at the end of their respective terms and production has
    not been established prior to such date. We have options to
    extend some of our leases through payment of additional lease
    bonus payments prior the expiration of the primary term of the
    leases. Our leases are mainly fee leases with three to five
    years of primary term. We believe that our leases are similar to
    our competitors fee lease terms as it relates to primary term
    and reserved royalty interests.
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Drilling
    activity
The following table summarizes our drilling activity for the
    period from February 26, 2007 through December 31,
    2007 and the years ended December 31, 2008 and 2009. Gross
    wells reflect the sum of all wells in which we own an interest.
    Net wells reflect the sum of our working interests in gross
    wells.
2007
2008
2009
Gross
Net
Gross
Net
Gross
Net
Development wells:
Oil
4
1.2
7
1.3
31
2.3
Gas
—
—
—
—
—
—
Dry(1)
2
1.5
1
1.0
—
—
Total development wells
6
2.7
8
2.3
31
2.3
Exploratory wells:
Oil
—
—
26
3.8
12
5.0
Gas
—
—
—
—
—
—
Dry(1)
—
—
1
0.3
—
—
Total exploratory wells
—
—
27
4.1
12
5.0
Total wells
6
2.7
35
6.4
43
7.3
(1)
Dry wells were drilled in conventional formations other than the
    Bakken.
As of December 31, 2009, there were 14 gross (2.7 net)
    development wells and 5 gross (1.4 net) exploratory wells
    in the process of drilling or completion.
Our drilling activity has increased each year since our
    inception. Exploration wells in 2008 and 2009 primarily focused
    on delineation and appraisal of the Bakken formation in our East
    Nesson and West Williston areas. Following the 2009 Kerogen
    acquisition, many operators increased the pace of development
    drilling in the Sanish project area, and as a result, we
    participated in a number of wells on a non-operated basis.
In 2007 and 2008, we had a total of 4 gross (2.9 net) wells
    that were deemed dry wells, all focused on conventional
    formations. In 2009 and in our 2010 capital plan, we have and
    expect to continue to be focused on drilling to the Bakken and
    Three Forks formations.
2010
    capital expenditure budget
Our total 2010 capital expenditure budget is $220 million,
    which consists of:
•
$134 million for drilling and completing operated wells;
•
$45 million for drilling and completing non-operated wells;
•
$15 million for maintaining and expanding our leasehold
    position;
•
$5 million for constructing infrastructure to support
    production in our core project areas; and
•
$21 million in unallocated funds which are available for
    additional drilling and leasing costs and activity.
While we have budgeted $220 million for these purposes, the
    ultimate amount of capital we will expend may fluctuate
    materially based on market conditions and the success of our
    drilling results as the year progresses. Please see
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations — Liquidity and Capital
    Resources."
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Our
    core project areas
Williston
    Basin
Our operations are focused in the Williston Basin in North
    Dakota and Montana. While we have interests in a substantial
    number of wells in the Williston Basin that target several
    different zones, our exploration and development activities
    currently are concentrated in the Bakken formation. Our
    management team originally targeted the Williston Basin because
    of its oil prone nature, multiple, stacked producing horizons,
    substantial resource potential and management's previous
    professional history in the basin. The Williston Basin also has
    established infrastructure and access to materials and services.
    Regulatory delays are minimal in the Williston Basin due to fee
    ownership of properties, efficient state and local regulatory
    bodies and reasonable permitting requirements.
The entire Williston Basin is spread across North Dakota, South
    Dakota, Montana and parts of southern Canada. The basin produces
    oil and natural gas from numerous producing horizons including,
    but not limited to, the Bakken, Three Forks, Madison and Red
    River formations. Commercial oil production activities began in
    the Williston Basin in the 1950's with the first well
    drilled in 1953. Since then, an estimated 3.8 billion
    barrels have been produced from the basin, primarily from
    conventional oil accumulations, which can be found at depths
    ranging from 5,000 feet to 15,000 feet. The Williston
    Basin formation is now one of the most actively drilled
    unconventional oil resource plays in the United States with
    approximately 97 rigs drilling in the basin as of
    February 16, 2010, including 88 in North Dakota and 9 in
    Montana. A report issued by the USGS in April 2008 classified
    these formations as the largest continuous oil accumulation ever
    assessed by it in the contiguous United States, with an
    estimated 3.65 billion barrels of technically recoverable
    oil resources.
The Devonian-age Bakken formation is found within the
    Williston Basin underlying portions of North Dakota and Montana
    and is comprised of three lithologic members including the upper
    shale, middle member and lower shale. The formation ranges up to
    150 feet thick. The upper and lower shales are highly
    organic, thermally mature and over pressured and can act as both
    a source and reservoir for the oil. The middle member, which
    varies in composition from a silty dolomite to shalely limestone
    or sand, also serves as a reservoir and is a critical component
    for commercial production. Generally, the Bakken formation is
    found at vertical depths of 8,500 to 11,000 feet.
Following the drilling of the first well in 1953, vertical well
    development of the Bakken formation occurred intermittently
    until 1987, when development of the upper shale using horizontal
    wells began to occur in the Bicentennial and Elkhorn Ranch
    areas. Development in the middle shale using horizontal wells
    began in 2001 with the discovery of the Elm Coulee Field. The
    use of horizontal drilling and improvements in completion
    technology have since expanded the development of the middle
    shale across a larger portion of the Williston Basin.
Generally, the reservoir rocks in the Bakken formation exhibit
    low porosity and permeability and require horizontal drilling
    and multi-stage fracture stimulation technology in order to
    produce economically. The fracture stimulation techniques vary
    but most commonly utilize multi-stage mechanically diverted
    stimulations using un-cemented liners and packers. Completion
    techniques have evolved as the Bakken formation has developed,
    with operators generally increasing lateral length and fracture
    stimulation stages.
The Three Forks formation generally found immediately under the
    Bakken formation has also proven to contain productive reservoir
    rock that may add incremental reserves to the play. The Three
    Forks formation typically consists of interbedded dolomites and
    shale with local development of a discontinuous sandy member at
    the top, known as the Sanish sand. The Three Forks formation is
    an unconventional carbonate play. Similar to the Bakken
    formation, the Three Forks formation has recently been exploited
    primarily using horizontal drilling and advanced completion
    techniques. Drilling in the Three Forks formation began in
    mid-2008 and a number of operators are targeting this formation.
Our total leasehold position in the Williston Basin as of
    December 31, 2009 consisted of 492,544 gross and
    292,242 net acres (396,280 gross (247,929 net)
    undeveloped acres and 96,264 gross (44,313 net) developed
    acres). Our estimated net proved reserves in the Williston Basin
    were 13.2 MMBoe at December 31, 2009. As of
    December 31, 2009, we had 69.6 net producing wells and
    net average daily production of
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2,914 MBoe/d for the three month period ending
    December 31, 2009, with an average working interest of 30%.
    Our average working interest in the wells we operate is
    approximately 86%. Currently, we estimate our capital
    expenditures for 2010 will be $220 million, which includes
    drilling 35 gross (22.4 net) horizontal operated wells,
    numerous non-operated wells, construction of infrastructure to
    support production and leasehold acquisitions. As of
    January 1, 2010, we were drilling or completing
    19 gross (4.1 net) wells in the Williston Basin. We
    participated in the drilling and completion of 43 gross
    wells for the year ended 2009.
Our Williston Basin activities are evaluated in three primary
    areas of operations, the West Williston area, the East Nesson
    area, and the Sanish area.
West
    Williston
The West Williston project area was our first area of operations
    and was established through an asset acquisition from Bill
    Barrett Corporation in June 2007. We control 245,722 gross
    (159,491 net) acres in the area, primarily in Williams and
    McKenzie counties in North Dakota and Roosevelt and Richland
    counties in Montana.
We had average daily production of 1,106 net Boe/d in the
    three months ended December 31, 2009, 19% of which was
    produced from the Bakken formation and the remainder from other
    conventional formations. As of December 31, 2009, we had an
    average working interest of 35% and operated 77% of our
    45.5 net producing wells in the West Williston project
    area. Additionally, as of December 31, 2009, we had
    106.5 net identified drilling locations based on
1280-acre
spacing units, of which 83% are estimated to be operated by us,
    targeting the Bakken formation in the West Williston project
    area.
During the year ended 2009, we participated in the drilling and
    completion of 5 gross (1.3 net) horizontal Bakken wells in
    the West Williston project area. As of January 1, 2010, we
    were participating in drilling or completion of 4 gross
    (1.4 net) wells in the West Williston project area. We have
    budgeted $110 million in capital expenditures in the West
    Williston project area in 2010 for the drilling and completion
    of 41 gross (18.8 net) wells.
East
    Nesson
We expanded into the East Nesson project area through a farm-in
    transaction in May 2008 with Fidelity Exploration and Production
    Company and Kerogen Resources, Inc. We subsequently increased
    our working interests in the area through the acquisitions of
    assets from Kerogen Resources, Inc. and additional working
    interests from Fidelity Exploration in June and September 2009,
    respectively. We control 202,791 gross (124,004 net) acres
    in the area, primarily in Mountrail and Burke counties in North
    Dakota.
We had average daily production of 1,016 net Boe/d in the
    three months ended December 31, 2009, all of which was
    produced from the Bakken and Three Forks formations. As of
    December 31, 2009, we had an average working interest of
    44% and operated 87% of our 19.0 net producing wells in the
    East Nesson project area. Additionally, as of December 31,
    2009, we had 57.0 net identified drilling locations based
    almost entirely on
1280-acre
spacing units, 95% of which are estimated to be operated by us,
    targeting the Bakken formation in the East Nesson project area.
During the year ended December 31, 2009, we drilled and
    completed 12 gross (4.1 net) horizontal Bakken and Three
    Forks wells in the East Nesson project area. As of
    January 1, 2010, we were drilling or completing
    3 gross (2.0 net) wells in the East Nesson project area. We
    have budgeted $47 million in capital expenditures in the
    East Nesson project area in 2010 for the drilling and completion
    of 13 gross (7.4 net) wells.
Sanish
We expanded into the Sanish project area through the acquisition
    of assets from Kerogen Resources, Inc. in June 2009. We control
    44,031 gross (8,747 net) acres in the area, all of which
    are located in Mountrail county in North Dakota.
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We had average daily production of 792 net Boe/d in the
    three months ended December 31, 2009, all of which was
    produced from the Bakken and Three Forks formations. As of
    December 31, 2009, we had an average working interest of 8%
    in our 5.1 net wells in the Sanish project area.
    Additionally, as of December 31, 2009, we had 9.6 net
    identified drilling locations targeting the Bakken and Three
    Forks formations in the Sanish project area. Our properties in
    the Sanish project area are entirely operated by other
    operators, the largest of which are Whiting Petroleum and
    Fidelity Exploration and Production Company.
During the year ended December 31, 2009, we participated in
    the drilling and completion of 26 gross (2.0 net)
    horizontal Bakken and Three Forks wells in the Sanish project
    area. As of January 1, 2010, we were participating in the
    drilling or completion of 12 gross (0.8 net) wells in the
    Sanish project area. We have budgeted $22 million in
    capital expenditures in the Sanish project area in 2010 for the
    drilling and completion of 3.8 net wells.
For more information on our reserves, operations and operating
    areas, see "Business — Our Operations."
Other
    operating areas
Barnett
    Shale
As part of the Kerogen Resources asset acquisition in June 2009,
    we acquired approximately 3,000 net acres with then-current
    net production of approximately 140 Boe/d in the Barnett shale
    play in Texas. In December 2009, we sold a portion of the wells
    and acreage. As of December 31, 2009, our estimated proved
    reserves in the Barnett shale were approximately 111 MBoe,
    representing less than 1% of our
PV-10
and
    were producing an average of 159 Boe/d for the three months
    ended December 31, 2009. We do not consider the Barnett
    shale a focus area and we do not currently plan any development
    activities in the area.
Marketing
    and Major Customers
We principally sell our oil and natural gas production to
    marketers and other purchasers that have access to nearby
    pipeline facilities. In areas where there is no practical access
    to pipelines, oil is transported by truck to storage facilities.
    Our marketing of oil and natural gas can be affected by factors
    beyond our control, the effects of which cannot be accurately
    predicted. For a description of some of these factors, see
    "Risk Factors — Market conditions or operational
    impediments may hinder our access to oil and natural gas markets
    or delay our production" and "Risk Factors —
    Delays and interruptions of production from our wells due to
    marketing and transportation constraints in the Williston Basin
    could cause significant fluctuations in our realized oil and
    natural gas prices."
In an effort to improve price realizations from the sale of our
    oil and natural gas, we manage our commodities marketing
    activities in-house, which enables us to market and sell our oil
    and natural gas to a broader array of potential purchasers. Due
    to the availability of other markets and pipeline connections,
    we do not believe that the loss of any single oil or natural gas
    customer would have a material adverse effect on our results of
    operations or cash flows.
For the year ended December 31, 2008, sales to Tesoro
    Refining and Marketing Company and Texon L.P. accounted for
    approximately 57% and 14%, respectively, of our total sales. For
    the year ended December 31, 2009, sales to Tesoro Refining
    and Marketing Company and Texon L.P. accounted for approximately
    32% and 30%, respectively, of our total sales. No other
    purchasers accounted for more than 10% of our total oil and
    natural gas sales for the year ended December 31, 2008 or
    2009. We believe that the loss of any of these purchasers would
    not have a material adverse effect on our operations, as there
    are a number of alternative crude oil and natural gas purchasers
    in our producing regions.
We sell our oil and condensate at the lease to a variety of
    purchasers at prevailing market prices under short-term
    contracts that normally provide for us to receive a market based
    price, which incorporates regional differentials that include
    but are not limited to transportation costs and adjustments for
    product quality.
Crude oil produced and sold in the Williston Basin has
    historically sold at a discount to the price quoted for West
    Texas Intermediate (WTI) crude oil due to transportation costs
    and takeaway capacity. In the past, there have been periods when
    this discount has substantially increased due to the production
    of oil in the area
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increasing to a point that it temporarily surpasses the
    available pipeline transportation and refining capacity in the
    area. The last such period was the fall and winter of 2008 and
    2009, when the Tesoro Refining and Marketing Company North
    Dakota Sweet discount to WTI on an average monthly basis reached
    $14.80 per barrel.
Since most of our oil and natural gas production is sold under
    market based or spot market contracts, the revenues generated by
    our operations are highly dependent upon the prices of and
    demand for oil and natural gas. The price we receive for our oil
    and natural gas production depends upon numerous factors beyond
    our control, including but not limited to seasonality, weather,
    competition, availability of transportation and gathering
    capabilities, the condition of the United States economy,
    foreign imports, political conditions in other oil-producing and
    natural gas-producing countries, the actions of the Organization
    of Petroleum Exporting Countries, and domestic government
    regulation, legislation and policies. See "Risk
    Factors— A substantial or extended decline in oil and,
    to a lesser extent, natural gas prices may adversely affect our
    business, financial condition or results of operations and our
    ability to meet our capital expenditure obligations and
    financial commitments." Furthermore, a decrease in the
    price of oil and natural gas could have an adverse effect on the
    carrying value of our proved reserves and on our revenues,
    profitability and cash flows. See "Risk
    Factors— If oil and natural gas prices decrease, we
    may be required to take write-downs of the carrying values of
    our oil and natural gas properties."
Although we are not currently experiencing any significant
    involuntary curtailment of our oil or natural gas production,
    market, economic, transportation and regulatory factors may in
    the future materially affect our ability to market our oil or
    natural gas production. See "Risk Factors— Market
    conditions or operational impediments may hinder our access to
    oil and natural gas markets or delay our production."
Title to
    Properties
As is customary in the oil and gas industry, we initially
    conduct a preliminary review of the title to our properties on
    which we do not have proved reserves. Prior to the commencement
    of drilling operations on those properties, we conduct a
    thorough title examination and perform curative work with
    respect to significant defects. To the extent title opinions or
    other investigations reflect title defects on those properties,
    we are typically responsible for curing any title defects at our
    expense. We generally will not commence drilling operations on a
    property until we have cured any material title defects on such
    property. We have obtained title opinions on substantially all
    of our producing properties and believe that we have
    satisfactory title to our producing properties in accordance
    with standards generally accepted in the oil and gas industry.
    Prior to completing an acquisition of producing oil and natural
    gas leases, we perform title reviews on the most significant
    leases and, depending on the materiality of the properties, we
    may obtain a title opinion or review previously obtained title
    opinions. Our oil and natural gas properties are subject to
    customary royalty and other interests, liens to secure
    borrowings under our revolving credit facility, liens for
    current taxes and other burdens which we believe do not
    materially interfere with the use or affect our carrying value
    of the properties. See "Risk Factors — We may
    incur losses as a result of title defects in the properties in
    which we invest."
Seasonality
Winter weather conditions and lease stipulations can limit or
    temporarily halt our drilling and producing activities and other
    oil and natural gas operations. These constraints and the
    resulting shortages or high costs could delay or temporarily
    halt our operations and materially increase our operating and
    capital costs. Such seasonal anomalies can also pose challenges
    for meeting our well drilling objectives and may increase
    competition for equipment, supplies and personnel during the
    spring and summer months, which could lead to shortages and
    increase costs or delay or temporarily halt our operations.
Competition
The oil and natural gas industry is highly competitive in all
    phases. We encounter competition from other oil and natural gas
    companies in all areas of operation, including the acquisition
    of leasing options on oil and
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natural gas properties to the exploration and development of
    those properties. Our competitors include major integrated oil
    and natural gas companies, numerous independent oil and natural
    gas companies, individuals and drilling and income programs.
    Many of our competitors are large, well established companies
    that have substantially larger operating staffs and greater
    capital resources than we do. Such companies may be able to pay
    more for lease options on oil and natural gas properties and
    exploratory locations and to define, evaluate, bid for and
    purchase a greater number of properties and locations than our
    financial or human resources permit. Our ability to acquire
    additional properties and to discover reserves in the future
    will depend upon our ability to evaluate and select suitable
    properties and to consummate transactions in a highly
    competitive environment. See "Risk Factors —
    Competition in the oil and natural gas industry is intense,
    making it more difficult for us to acquire properties, market
    oil and natural gas and secure trained personnel."
Regulation
    of the Oil and Natural Gas Industry
Our operations are substantially affected by federal, state and
    local laws and regulations. In particular, oil and natural gas
    production and related operations are, or have been, subject to
    price controls, taxes and numerous other laws and regulations.
    All of the jurisdictions in which we own or operate properties
    for oil and natural gas production have statutory provisions
    regulating the exploration for and production of oil and natural
    gas, including provisions related to permits for the drilling of
    wells, bonding requirements to drill or operate wells, the
    location of wells, the method of drilling and casing wells, the
    surface use and restoration of properties upon which wells are
    drilled, sourcing and disposal of water used in the drilling and
    completion process, and the abandonment of wells. Our operations
    are also subject to various conservation laws and regulations.
    These include regulation of the size of drilling and spacing
    units or proration units, the number of wells which may be
    drilled in an area, and the unitization or pooling of oil and
    natural gas wells, as well as regulations that generally
    prohibit the venting or flaring of natural gas and impose
    certain requirements regarding the ratability or fair
    apportionment of production from fields and individual wells.
Failure to comply with applicable laws and regulations can
    result in substantial penalties. The regulatory burden on the
    industry increases the cost of doing business and affects
    profitability. Although we believe we are in substantial
    compliance with all applicable laws and regulations, and that
    continued substantial compliance with existing requirements will
    not have a material adverse effect on our financial position,
    cash flows or results of operations, such laws and regulations
    are frequently amended or reinterpreted. Additionally, currently
    unforeseen environmental incidents may occur or past
    non-compliance with environmental laws or regulations may be
    discovered. Therefore, we are unable to predict the future costs
    or impact of compliance. Additional proposals and proceedings
    that affect the oil and natural gas industry are regularly
    considered by Congress, the states, the Federal Energy
    Regulatory Commission, or FERC, and the courts. We cannot
    predict when or whether any such proposals may become effective.
Regulation
    of transportation of oil
Sales of crude oil, condensate and natural gas liquids are not
    currently regulated and are made at negotiated prices.
    Nevertheless, Congress could reenact price controls in the
    future.
Our sales of crude oil are affected by the availability, terms
    and cost of transportation. The transportation of oil in common
    carrier pipelines is also subject to rate and access regulation.
    The FERC regulates interstate oil pipeline transportation rates
    under the Interstate Commerce Act. In general, interstate oil
    pipeline rates must be cost-based, although settlement rates
    agreed to by all shippers are permitted and market based rates
    may be permitted in certain circumstances. Effective
    January 1, 1995, the FERC implemented regulations
    establishing an indexing system (based on inflation) for
    transportation rates for oil that allowed for an increase or
    decrease in the cost of transporting oil to the purchaser. A
    review of these regulations by the FERC in 2000 was successfully
    challenged on appeal by an association of oil pipelines. On
    remand, the FERC in February 2003 increased the index
    slightly, effective July 2001.
Intrastate oil pipeline transportation rates are subject to
    regulation by state regulatory commissions. The basis for
    intrastate oil pipeline regulation, and the degree of regulatory
    oversight and scrutiny given to intrastate oil pipeline rates,
    varies from state to state. Insofar as effective interstate and
    intrastate rates are
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equally applicable to all comparable shippers, we believe that
    the regulation of oil transportation rates will not affect our
    operations in any way that is of material difference from those
    of our competitors who are similarly situated.
Further, interstate and intrastate common carrier oil pipelines
    must provide service on a non-discriminatory basis. Under this
    open access standard, common carriers must offer service to all
    similarly situated shippers requesting service on the same terms
    and under the same rates. When oil pipelines operate at full
    capacity, access is governed by prorationing provisions set
    forth in the pipelines' published tariffs. Accordingly, we
    believe that access to oil pipeline transportation services
    generally will be available to us to the same extent as to our
    similarly situated competitors.
Regulation
    of transportation and sales of natural gas
Historically, the transportation and sale for resale of natural
    gas in interstate commerce have been regulated by the FERC under
    the Natural Gas Act, or NGA of 1938, the Natural Gas Policy Act,
    or NGPA of 1978 and regulations issued under those Acts. In the
    past, the federal government has regulated the prices at which
    natural gas could be sold. While sales by producers of natural
    gas can currently be made at uncontrolled market prices,
    Congress could reenact price controls in the future.
    Deregulation of wellhead natural gas sales began with the
    enactment of the Natural Gas Policy Act and culminated in
    adoption of the Natural Gas Wellhead Decontrol Act which removed
    all price controls affecting wellhead sales of natural gas
    effective January 1, 1993.
FERC regulates interstate natural gas transportation rates and
    service conditions, which affects the marketing of natural gas
    that we produce, as well as the revenues we receive for sales of
    our natural gas. Since 1985, the FERC has endeavored to make
    natural gas transportation more accessible to natural gas buyers
    and sellers on an open and non-discriminatory basis. The FERC
    has stated that open access policies are necessary to improve
    the competitive structure of the interstate natural gas pipeline
    industry and to create a regulatory framework that will put
    natural gas sellers into more direct contractual relations with
    natural gas buyers by, among other things, unbundling the sale
    of natural gas from the sale of transportation and storage
    services. Beginning in 1992, the FERC issued a series of orders,
    beginning with Order No. 636, to implement its open access
    policies. As a result, the interstate pipelines'
    traditional role as wholesalers of natural gas has been
    eliminated and replaced by a structure under which pipelines
    provide transportation and storage service on an open access
    basis to others who buy and sell natural gas. Although the
    FERC's orders do not directly regulate natural gas
    producers, they are intended to foster increased competition
    within all phases of the natural gas industry.
In 2000, the FERC issued Order No. 637 and subsequent
    orders, which imposed a number of additional reforms designed to
    enhance competition in natural gas markets. Among other things,
    Order No. 637 revised the FERC's pricing policy by
    waiving price ceilings for short-term released capacity for a
    two-year experimental period, and effected changes in FERC
    regulations relating to scheduling procedures, capacity
    segmentation, penalties, rights of first refusal and information
    reporting. Most pipelines' tariff filings to implement the
    requirements of Order No. 637 have been accepted by the
    FERC and placed into effect. While most major aspects of Order
    No. 637 have been upheld on judicial review, certain issues
    such as capacity segmentation and right of first refusal are
    pending further consideration by the FERC. We cannot predict
    what action FERC will take on these matters in the future, or
    whether FERC's actions will survive further judicial review.
We cannot accurately predict whether the FERC's actions
    will achieve the goal of increasing competition in markets in
    which our natural gas is sold. Additional proposals and
    proceedings that might affect the natural gas industry are
    pending before the FERC and the courts. The natural gas industry
    historically has been very heavily regulated. Therefore, we
    cannot provide any assurance that the less stringent regulatory
    approach recently established by the FERC will continue.
    However, we do not believe that any action taken will affect us
    in a way that materially differs from the way it affects other
    natural gas producers.
The price at which we sell natural gas is not currently subject
    to federal rate regulation and, for the most part, is not
    subject to state regulation. However, with regard to our
    physical sales of these energy commodities,
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we are required to observe anti-market manipulation laws and
    related regulations enforced by the FERC
and/or
the
    Commodity Futures Trading Commission, or the CFTC. See below the
    discussion of "Other federal laws and regulations affecting
    our industry — Energy Policy Act of 2005." Should
    we violate the anti-market manipulation laws and regulations, we
    could also be subject to related third party damage claims by,
    among others, sellers, royalty owners and taxing authorities. In
    addition, pursuant to Order No. 704, some of our operations
    may be required to annually report to FERC, beginning
    May 1, 2009. Order No. 704 requires certain natural
    gas market participants to report information regarding their
    reporting of transactions to price index publishers and their
    blanket sales certificate status, as well as certain information
    regarding their wholesale, physical natural gas transactions for
    the previous calendar year depending on the volume of natural
    gas transacted. See below the discussion of "Other federal
    laws and regulations affecting our industry — FERC
    Market Transparency Rules."
Gathering services, which occur upstream of jurisdictional
    transmission services, are regulated by the states onshore and
    in state waters. Although its policy is still in flux, FERC has
    reclassified certain jurisdictional transmission facilities as
    non-jurisdictional gathering facilities, which has the tendency
    to increase our costs of getting gas to point of sale locations.
    State regulation of natural gas gathering facilities generally
    includes various safety, environmental and, in some
    circumstances, nondiscriminatory take requirements. Although
    such regulation has not generally been affirmatively applied by
    state agencies, natural gas gathering may receive greater
    regulatory scrutiny in the future.
Intrastate natural gas transportation and facilities are also
    subject to regulation by state regulatory agencies, and certain
    transportation services provided by intrastate pipelines are
    also regulated by FERC. The basis for intrastate regulation of
    natural gas transportation and the degree of regulatory
    oversight and scrutiny given to intrastate natural gas pipeline
    rates and services varies from state to state. Insofar as such
    regulation within a particular state will generally affect all
    intrastate natural gas shippers within the state on a comparable
    basis, we believe that the regulation of similarly situated
    intrastate natural gas transportation in any states in which we
    operate and ship natural gas on an intrastate basis will not
    affect our operations in any way that is of material difference
    from those of our competitors. Like the regulation of interstate
    transportation rates, the regulation of intrastate
    transportation rates affects the marketing of natural gas that
    we produce, as well as the revenues we receive for sales of our
    natural gas.
Regulation
    of production
The production of oil and natural gas is subject to regulation
    under a wide range of local, state and federal statutes, rules,
    orders and regulations. Federal, state and local statutes and
    regulations require permits for drilling operations, drilling
    bonds and reports concerning operations. All of the states in
    which we own and operate properties have regulations governing
    conservation matters, including provisions for the unitization
    or pooling of oil and natural gas properties, the establishment
    of maximum allowable rates of production from oil and natural
    gas wells, the regulation of well spacing, and plugging and
    abandonment of wells. The effect of these regulations is to
    limit the amount of oil and natural gas that we can produce from
    our wells and to limit the number of wells or the locations at
    which we can drill, although we can apply for exceptions to such
    regulations or to have reductions in well spacing. Moreover,
    each state generally imposes a production or severance tax with
    respect to the production and sale of oil, natural gas and
    natural gas liquids within its jurisdiction.
The failure to comply with these rules and regulations can
    result in substantial penalties. Our competitors in the oil and
    natural gas industry are subject to the same regulatory
    requirements and restrictions that affect our operations.
Other
    federal laws and regulations affecting our
    industry
Energy Policy Act of 2005.
On August 8,
    2005, President Bush signed into law the Domenici-Barton Energy
    Policy Act of 2005, or the EPAct 2005. EPAct 2005 is a
    comprehensive compilation of tax incentives, authorized
    appropriations for grants and guaranteed loans, and significant
    changes to the statutory policy that affects all segments of the
    energy industry. Among other matters, EPAct 2005 amends the NGA
    to add an
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anti-manipulation provision which makes it unlawful for any
    entity to engage in prohibited behavior to be prescribed by
    FERC, and furthermore provides FERC with additional civil
    penalty authority. EPAct 2005 provides the FERC with the power
    to assess civil penalties of up to $1,000,000 per day for
    violations of the NGA and increases the FERC's civil
    penalty authority under the NGPA from $5,000 per violation per
    day to $1,000,000 per violation per day. The civil penalty
    provisions are applicable to entities that engage in the sale of
    natural gas for resale in interstate commerce. On
    January 19, 2006, FERC issued Order No. 670, a rule
    implementing the anti-manipulation provision of EPAct 2005, and
    subsequently denied rehearing. The rule makes it unlawful for
    any entity, directly or indirectly, to: (1) in connection
    with the purchase or sale of natural gas subject to the
    jurisdiction of FERC, or the purchase or sale of transportation
    services subject to the jurisdiction of FERC, to use or employ
    any device, scheme or artifice to defraud; (2) to make any
    untrue statement of material fact or omit to make any such
    statement necessary to make the statements made not misleading;
    or (3) to engage in any act or practice that operates as a
    fraud or deceit upon any person. The new anti-manipulation rules
    do not apply to activities that relate only to intrastate or
    other non-jurisdictional sales or gathering, but do apply to
    activities of gas pipelines and storage companies that provide
    interstate services, such as Section 311 service, as well
    as otherwise non-jurisdictional entities to the extent the
    activities are conducted "in connection with" gas
    sales, purchases or transportation subject to FERC jurisdiction,
    which now includes the annual reporting requirements under Order
    704. The anti-manipulation rules and enhanced civil penalty
    authority reflect an expansion of FERC's NGA enforcement
    authority. Should we fail to comply with all applicable FERC
    administered statutes, rules, regulations, and orders, we could
    be subject to substantial penalties and fines.
FERC Market Transparency Rules.
On
    December 26, 2007, FERC issued a final rule on the annual
    natural gas transaction reporting requirements, as amended by
    subsequent orders on rehearing, or Order No. 704. Under
    Order No. 704, wholesale buyers and sellers of more than
    2.2 million MMBtu of physical natural gas in the previous
    calendar year, including interstate and intrastate natural gas
    pipelines, natural gas gatherers, natural gas processors,
    natural gas marketers and natural gas producers, are required to
    report, on May 1 of each year beginning in 2009, aggregate
    volumes of natural gas purchased or sold at wholesale in the
    prior calendar year to the extent such transactions utilize,
    contribute to or may contribute to the formation of price
    indices. It is the responsibility of the reporting entity to
    determine which individual transactions should be reported based
    on the guidance of Order No. 704. Order No. 704 also
    requires market participants to indicate whether they report
    prices to any index publishers and, if so, whether their
    reporting complies with FERC's policy statement on price
    reporting.
Additional proposals and proceedings that might affect the
    natural gas industry are pending before Congress, FERC and the
    courts. We cannot predict the ultimate impact of these or the
    above regulatory changes to our natural gas operations. We do
    not believe that we would be affected by any such action
    materially differently than similarly situated competitors.
Environmental,
    Health and Safety Regulation
Our exploration, development and production operations are
    subject to various federal, state and local laws and regulations
    governing health and safety, the discharge of materials into the
    environment or otherwise relating to environmental protection.
    These laws and regulations may, among other things, require the
    acquisition of permits to conduct exploration, drilling and
    production operations; govern the amounts and types of
    substances that may be released into the environment in
    connection with oil and gas drilling and production; restrict
    the way we handle or dispose of our wastes; limit or prohibit
    construction or drilling activities in sensitive areas such as
    wetlands, wilderness areas or areas inhabited by endangered or
    threatened species; require investigatory and remedial actions
    to mitigate pollution conditions caused by our operations or
    attributable to former operations; and impose obligations to
    reclaim and abandon well sites and pits. Failure to comply with
    these laws and regulations may result in the assessment of
    administrative, civil and criminal penalties, the imposition of
    remedial obligations and the issuance of orders enjoining some
    or all of our operations in affected areas.
These laws and regulations may also restrict the rate of oil and
    natural gas production below the rate that would otherwise be
    possible. The regulatory burden on the oil and gas industry
    increases the cost of doing
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business in the industry and consequently affects profitability.
    Additionally, the Congress and federal and state agencies
    frequently revise environmental, health and safety laws and
    regulations, and any changes that result in more stringent and
    costly waste handling, disposal, cleanup and remediation
    requirements for the oil and gas industry could have a
    significant impact on our operating costs.
The clear trend in environmental regulation is to place more
    restrictions and limitations on activities that may affect the
    environment, and thus, any changes in environmental laws and
    regulations or re-interpretation of enforcement policies that
    result in more stringent and costly waste handling, storage,
    transport, disposal, or remediation requirements could have a
    material adverse effect on our operations and financial
    position. We may be unable to pass on such increased compliance
    costs to our customers. Moreover, accidental releases or spills
    may occur in the course of our operations, and we cannot assure
    you that we will not incur significant costs and liabilities as
    a result of such releases or spills, including any third party
    claims for damage to property, natural resources or persons.
    While we believe that we are in substantial compliance with
    existing environmental laws and regulations and that continued
    compliance with current requirements would not have a material
    adverse effect on our financial condition or results of
    operations, there is no assurance that this trend will continue
    in the future.
The following is a summary of the more significant existing
    environmental, health and safety laws and regulations to which
    our business operations are subject and for which compliance may
    have a material adverse impact on our capital expenditures,
    results of operations or financial position.
Hazardous
    substances and waste
The Comprehensive Environmental Response, Compensation, and
    Liability Act, as amended, CERCLA, also known as the Superfund
    law and comparable state laws impose liability without regard to
    fault or the legality of the original conduct on certain classes
    of persons who are considered to be responsible for the release
    of a "hazardous substance" into the environment. These
    persons include current and prior owners or operators of the
    site where the release occurred and entities that disposed or
    arranged for the disposal of the hazardous substances found at
    the site. Under CERCLA, these "responsible persons"
    may be subject to joint and several, strict liability for the
    costs of cleaning up the hazardous substances that have been
    released into the environment, for damages to natural resources,
    and for the costs of certain health studies. CERCLA also
    authorizes the EPA and, in some instances, third parties to act
    in response to threats to the public health or the environment
    and to seek to recover from the responsible classes of persons
    the costs they incur. It is not uncommon for neighboring
    landowners and other third parties to file claims for personal
    injury and property damage allegedly caused by the release of
    hazardous substances or other pollutants into the environment.
    We generate materials in the course of our operations that may
    be regulated as hazardous substances.
We also generate solid and hazardous wastes that are subject to
    the requirements of the Resource Conservation and Recovery Act,
    as amended, or RCRA, and comparable state statutes. RCRA imposes
    strict requirements on the generation, storage, treatment,
    transportation and disposal of hazardous wastes. In the course
    of our operations we generate petroleum hydrocarbon wastes and
    ordinary industrial wastes that may be regulated as hazardous
    wastes.
We currently own or lease, and have in the past owned or leased,
    properties that have been used for numerous years to explore and
    produce oil and natural gas. Although we have utilized operating
    and disposal practices that were standard in the industry at the
    time, hydrocarbons and wastes may have been disposed of or
    released on or under the properties owned or leased by us or on
    or under the other locations where these hydrocarbons and wastes
    have been taken for treatment or disposal. In addition, certain
    of these properties have been operated by third parties whose
    treatment and disposal or release of hydrocarbons and wastes was
    not under our control. These properties and wastes disposed
    thereon may be subject to CERCLA, RCRA and analogous state laws.
    Under these laws, we could be required to remove or remediate
    previously disposed wastes (including wastes disposed of or
    released by prior owners or operators), to clean up contaminated
    property (including contaminated groundwater) and to perform
    remedial operations to prevent future contamination.
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Air
    emissions
The Clean Air Act, as amended, and comparable state laws and
    regulations restrict the emission of air pollutants from many
    sources and also impose various monitoring and reporting
    requirements. These laws and regulations may require us to
    obtain pre-approval for the construction or modification of
    certain projects or facilities expected to produce or
    significantly increase air emissions, obtain and strictly comply
    with stringent air permit requirements or utilize specific
    equipment or technologies to control emissions. Obtaining
    permits has the potential to delay the development of oil and
    natural gas projects. While we may be required to incur certain
    capital expenditures in the next few years for air pollution
    control equipment or other air emissions-related issues, we do
    not believe that such requirements will have a material adverse
    effect on our operations.
Climate
    change
In response to certain scientific studies suggesting that
    emissions of certain gases, commonly referred to as
    "greenhouse gases" and including carbon dioxide and
    methane, are contributing to the warming of the Earth's
    atmosphere and other climatic changes, the U.S. Congress
    has been actively considering legislation to reduce such
    emissions. On June 26, 2009, the U.S. House of
    Representatives passed the American Clean Energy and Security
    Act of 2009, or ACESA, which would establish an economy-wide
cap-and-trade
program to reduce U.S. emissions of "greenhouse
    gases" including carbon dioxide and methane that may
    contribute to warming of the Earth's atmosphere and other
    climatic changes. ACESA would require a 17 percent
    reduction in greenhouse gas emissions from 2005 levels by 2020
    and just over an 80 percent reduction of such emissions by
    2050. Under this legislation, the EPA would issue a capped and
    steadily declining number of tradable emissions allowances to
    major sources of greenhouse gas emissions so that such sources
    could continue to emit greenhouse gases into the atmosphere.
    These allowances would be expected to escalate significantly in
    cost over time. The U.S. Senate has begun work on its own
    legislation for restricting domestic greenhouse gas emissions
    and President Obama has indicated his support of legislation to
    reduce greenhouse gas emissions through an emission allowance
    system. Although it is not possible at this time to predict when
    the Senate may act on climate change legislation or how any bill
    passed by the Senate would be reconciled with ACESA, any future
    federal laws or implementing regulations that may be adopted to
    address greenhouse gas emissions could require us to incur
    increased operating costs and could adversely affect demand for
    the oil and natural gas we produce.
In addition, on December 15, 2009, the EPA published its
    finding that emissions of greenhouse gases presented an
    endangerment to human health and the environment. These findings
    by the EPA allow the agency to proceed with the adoption and
    implementation of regulations that would restrict emissions of
    greenhouse gases under existing provisions of the federal Clean
    Air Act. Consequently, the EPA proposed two sets of regulations
    that would require a reduction in emissions of greenhouse gases
    from motor vehicles and could trigger permit review for
    greenhouse gas emissions from certain stationary sources. In
    addition, on October 30, 2009, the EPA published a final
    rule requiring the reporting of greenhouse gas emissions from
    specified large greenhouse gas emission sources in the
    U.S. beginning in 2011 for emissions occurring in 2010. The
    adoption and implementation of any regulations imposing
    reporting obligations on, or limiting emissions of greenhouse
    gases from, our equipment and operations could require us to
    incur costs to reduce emissions of greenhouse gases associated
    with our operations or could adversely affect demand for the oil
    and natural gas we produce.
Even if such legislation is not adopted at the national level,
    more than one-third of the states have begun taking actions to
    control
and/or
reduce emissions of greenhouse gases, primarily through the
    planned development of greenhouse gas emission inventories
and/or
regional greenhouse gas cap and trade programs. Although most of
    the state-level initiatives have to date focused on large
    sources of greenhouse gas emissions, such as coal-fired electric
    plants, it is possible that smaller sources of emissions could
    become subject to greenhouse gas emission limitations or
    allowance purchase requirements in the future. Any one of these
    climate change regulatory and legislative initiatives could have
    a material adverse effect on our business, financial condition
    and results of operations.
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Water
    discharges
The Federal Water Pollution Control Act, as amended, or the
    Clean Water Act, and analogous state laws impose restrictions
    and strict controls regarding the discharge of pollutants into
    navigable waters. Pursuant to the Clean Water Act and analogous
    state laws, permits must be obtained to discharge pollutants
    into state waters or waters of the U.S. Any such discharge
    of pollutants into regulated waters must be performed in
    accordance with the terms of the permit issued by the EPA or the
    analogous state agency. Spill prevention, control and
    countermeasure requirements under federal law require
    appropriate containment berms and similar structures to help
    prevent the contamination of navigable waters in the event of a
    petroleum hydrocarbon tank spill, rupture or leak. In addition,
    the Clean Water Act and analogous state laws require individual
    permits or coverage under general permits for discharges of
    storm water runoff from certain types of facilities.
The Oil Pollution Act of 1990, as amended, or the OPA, which
    amends the Clean Water Act, establishes strict liability for
    owners and operators of facilities that are the site of a
    release of oil into waters of the U.S. The OPA and its
    associated regulations impose a variety of requirements on
    responsible parties related to the prevention of oil spills and
    liability for damages resulting from such spills. A
    "responsible party" under the OPA includes owners and
    operators of certain onshore facilities from which a release may
    affect waters of the U.S.
Endangered
    Species Act
The federal Endangered Species Act, as amended, the ESA,
    restricts activities that may affect endangered and threatened
    species or their habitats. While some of our facilities may be
    located in areas that are designated as habitat for endangered
    or threatened species, we believe that we are in substantial
    compliance with the ESA. However, the designation of previously
    unidentified endangered or threatened species could cause us to
    incur additional costs or become subject to operating
    restrictions or bans in the affected areas.
Employee
    health and safety
We are subject to a number of federal and state laws and
    regulations, including the federal Occupational Safety and
    Health Act, as amended the OSHA, and comparable state statutes,
    whose purpose is to protect the health and safety of workers. In
    addition, the OSHA hazard communication standard, the EPA
    community
right-to-know
regulations under Title III of the federal Superfund
    Amendment and Reauthorization Act and comparable state statutes
    require that information be maintained concerning hazardous
    materials used or produced in our operations and that this
    information be provided to employees, state and local government
    authorities and citizens. We believe that we are in substantial
    compliance with all applicable laws and regulations relating to
    worker health and safety.
Other
    laws
The federal Energy Policy Act of 2005 amended the Underground
    Injection Control, or UIC, provisions of the federal Safe
    Drinking Water Act, or the SDWA, to exclude hydraulic fracturing
    from the definition of "underground injection."
    However, the U.S. Senate and House of Representatives are
    currently considering bills entitled, the Fracturing
    Responsibility and Awareness of Chemicals Act, or the FRAC Act,
    to amend the SDWA to repeal this exemption. If enacted, the FRAC
    Act would amend the definition of "underground
    injection" in the SDWA to encompass hydraulic fracturing
    activities. If enacted, such a provision could require hydraulic
    fracturing operations to meet permitting and financial assurance
    requirements, adhere to certain construction specifications,
    fulfill monitoring, reporting, and recordkeeping obligations,
    and meet plugging and abandonment requirements. The FRAC Act
    also proposes to require the reporting and public disclosure of
    chemicals used in the fracturing process, which could make it
    easier for third parties opposing the hydraulic fracturing
    process to initiate legal proceedings based on allegations that
    specific chemicals used in the fracturing process could
    adversely affect groundwater.
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Legal
    Proceedings
Although we may, from time to time, be involved in litigation
    and claims arising out of our operations in the normal course of
    business, we are not currently a party to any material legal
    proceeding. In addition, we are not aware of any material legal
    or governmental proceedings against us, or contemplated to be
    brought against us.
Employees
As of December 31, 2009, we employed 27 people,
    including four employees in geology, 11 in operations and
    engineering, four in accounting and finance and five in land.
    Our future success will depend partially on our ability to
    attract, retain and motivate qualified personnel. We are not a
    party to any collective bargaining agreements and have not
    experienced any strikes or work stoppages. We consider our
    relations with our employees to be satisfactory. From time to
    time we utilize the services of independent contractors to
    perform various field and other services.
Offices
We currently lease approximately 13,500 square feet of
    office space in Houston, Texas at 1001 Fannin, Suite 202,
    where our principal offices are located. The lease for our
    Houston office expires in April 2012. We also have a lease for a
    field office in the Williston Basin in North Dakota.
Formation
We were incorporated in 2010 pursuant to the laws of the State
    of Delaware as Oasis Petroleum Inc. to become a holding company
    for Oasis Petroleum LLC after the reorganization. Oasis
    Petroleum LLC was formed as a Delaware limited liability company
    on February 26, 2007 by certain members of our senior
    management team through Oasis Petroleum Management LLC and
    private equity funds managed by EnCap.
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MANAGEMENT
Directors,
    Executive Officers and Other Key Employees
The following table sets forth information regarding our
    directors and executive officers as of March 1, 2010. There
    are no family relationships among any of our directors or
    executive officers.
Name
Age
Title
Thomas B. Nusz
50
Chairman, President and Chief Executive Officer
Taylor L. Reid
47
Director, Executive Vice President, and Chief Operating Officer
Douglas E. Swanson, Jr.
38
Director
Robert L. Zorich
60
Director
Kent O. Beers
60
Senior Vice President Land
Robert J. Candito
55
Senior Vice President Exploration
Michael H. Lou
35
Senior Vice President Finance
Roy W. Mace
50
Senior Vice President, Chief Accounting Officer and Corporate
    Secretary
H. Brett Newton
43
Senior Vice President Asset Management
Walter S. Smithwick
50
Senior Vice President Operations
The following table sets forth information regarding other key
    employees as of March 1, 2010.
Name
Age
Title
Steven C. Ellsberry
63
Vice President and Assistant Controller
Dean A. Gilbert
56
Vice President Development Geology
Thomas F. Hawkins
56
Vice President Land and Contracts
Robin E. Hesketh
51
Vice President Operations Engineering
Robert L. Stovall
52
Vice President Geophysics
Set forth below is the description of the backgrounds of our
    directors, executive officers and other key employees.
Thomas B. Nusz
has served as our Director, President and
    Chief Executive Officer (or in similar capacities) since our
    inception in March 2007 and has 28 years of experience in
    the oil and gas industry. Mr. Nusz will become our Chairman
    upon the completion of this offering. From April 2006 to
    February 2007, Mr. Nusz managed his personal investments,
    developed the business plan for Oasis Petroleum and secured
    funding for the company. He was previously a Vice President with
    Burlington Resources, Inc., a formerly publicly traded oil and
    gas exploration and production company or, together with its
    predecessors, Burlington, and served as President International
    Division (North Africa, Northwest Europe, Latin America and
    China) from January 2004 to March 2006, as Vice President
    Acquisitions and Divestitures from October 2000 to December 2003
    and as Vice President Strategic Planning and Engineering from
    July 1998 to September 2000 and Chief Engineer for substantially
    all of such period. He was instrumental in Burlington's
    expansion into the Western Canadian Sedimentary Basin from 1999
    to 2002. From September 1985 to June 1998, Mr. Nusz held
    various operations and managerial positions with Burlington in
    several regions of the United States, including the Permian
    Basin, the San Juan Basin, the Black Warrior Basin, the
    Anadarko Basin, onshore Gulf Coast and Gulf of Mexico.
    Mr. Nusz was an engineer with Mobil Oil Corporation and for
    Superior Oil Company from June 1982 to August 1985. He is a
    current member of the National Petroleum Council, an advisory
    committee to the Secretary of Energy of the United States.
    Mr. Nusz holds a Bachelor of Science in Petroleum
    Engineering from Mississippi State University.
Taylor L. Reid
has served as our Director, Executive Vice
    President and Chief Operating Officer (or in similar capacities)
    since our inception in March 2007 and has 24 years of
    experience in the oil and gas industry. From November 2006 to
    February 2007, Mr. Reid worked with Mr. Nusz to form the
    business plan
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for Oasis Petroleum and secure funding for the company. He
    previously served as Asset Manager Permian and Panhandle
    Operations with ConocoPhillips from April 2006 to October 2006.
    Prior to joining ConocoPhillips, he served as General Manager
    Latin America and Asia Operations with Burlington from March
    2004 to March 2006 and as General Manager Corporate Acquisitions
    and Divestitures from July 1998 to February 2004. From March
    1986 to June 1998, Mr. Reid held various operations and
    managerial positions with Burlington in several regions of the
    continental United States, including the Permian Basin, the
    Williston Basin and the Anadarko Basin. He was instrumental in
    Burlington's expansion into the Western Canadian
    Sedimentary Basin from 1999 to 2002. Mr. Reid holds a
    Bachelor of Science in Petroleum Engineering from Stanford
    University.
Douglas E. Swanson, Jr.
has served as our Director
    since our inception in March 2007. Mr. Swanson has served
    as Managing Director of EnCap Investments L.P., an investment
    management firm, since 1999. Prior to his position at EnCap, he
    was in the corporate lending division of Frost National Bank
    from 1995 to 1997, specializing in energy-related service
    companies, and was a financial analyst in the corporate lending
    group of Southwest Bank of Texas from 1994 to 1995.
    Mr. Swanson has extensive industry experience serving on
    numerous boards of private oil and gas exploration and
    production companies over his 11-year history with EnCap and is
    a member of the Independent Petroleum Association of America and
    the Texas Independent Producers & Royalty Owners
    Association. Mr. Swanson holds a Bachelor of Arts in
    Economics and a Masters of Business Administration, both from
    the University of Texas at Austin.
Robert L. Zorich
has served as our Director since our
    inception in March 2007. Mr. Zorich is a Principal of EnCap
    Investments L.P., an investment management firm which he
    co-founded in 1988. Prior to the formation of EnCap,
    Mr. Zorich was a Senior Vice President of
    Trust Company of the West, a large, privately-held pension
    fund manager, from 1986 to 1988. Prior to joining
    Trust Company of the West, Mr. Zorich co-founded MAZE
    Exploration, Inc., a company actively involved in oil and gas
    exploration, development and reserve acquisitions, serving as
    its Co-Chief Executive Officer from 1981 to 1986.
    Mr. Zorich began his career at Republic National Bank of
    Dallas where he worked from 1974 to 1981. He ultimately served
    as Vice President and Division Manager in the Energy
    Department. He serves on the board of directors of several EnCap
    portfolio companies, is also a member of the board of directors
    of Enerplus Resources Fund (NYSE: ERF) and was previously a
    director of TODCO (NYSE: THE). He is a member of the Independent
    Petroleum Association of America and Texas Independent Producers
    and Royalty Owners Association. Mr. Zorich holds a Bachelor
    of Arts in Economics from the University of California at
    Santa Barbara and a Masters Degree in International
    Management from the American Graduate School of International
    Management.
Kent O. Beers
has served as our Senior Vice President
    Land (or in similar capacities) since August 2007 and has
    34 years of experience in the oil and gas industry. He
    previously served as Commercial Director International with
    ConocoPhillips from March 2006 to July 2006. Prior to joining
    ConocoPhillips, Mr. Beers held various managerial positions
    in the Commercial and Business Development divisions of
    Burlington from June 1997 to March 2006 and was Manager
    Corporate Divestitures of Burlington from June 1994 to May 1997.
    From June 1982 to May 1994, Mr. Beers held various land
    managerial positions with Burlington in the Rocky Mountain
    Region and the Williston Basin. Prior to joining Burlington, he
    was a Land Manager of NuCorp Energy Inc. from 1980 to 1982 and
    Regional Land Manager of Hunt Energy Corporation from 1976 to
    1980. Mr. Beers holds a Bachelor of Science in Business
    Administration from Montana State University.
Robert J. Candito
has served as our Senior Vice President
    Exploration (or in similar capacities) since our inception in
    March 2007 and has 32 years of experience in the oil and
    gas industry. He previously served as Principal Geologist with
    ConocoPhillips from April 2006 to August 2007. Prior to joining
    ConocoPhillips, Mr. Candito was a Senior Geological Advisor
    with Burlington from February 1995 to March 2006. At Burlington
    he held various positions in both exploration and development
    operations with Burlington in several regions of the continental
    United States, including the Gulf Coast, the Rocky Mountains and
    the Anadarko Basin. From January 1999 through March 2006,
    Mr. Candito worked for Burlington's International
    Division on South American projects. Prior to joining
    Burlington, Mr. Candito worked for several independent
    operators in both the Rocky Mountain and Gulf Coast regions.
    Mr. Candito holds a Bachelor of Science in Geology from
    Bridgewater State College and a Master of Science in
    Geochemistry from the Colorado School of Mines.
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Michael H. Lou
has served as our Senior Vice
    President Finance (or similar capacities) since September
    2009 and has 13 years of experience in the oil and gas
    industry. Prior to joining us, Mr. Lou was an independent
    contractor from January 2009 to August 2009. From February 2008
    to December 2008, he served as the Chief Financial Officer of
    Giant Energy Ltd., a private oil and gas management company,
    from July 2006 to December 2008 he served as Chief Financial
    Officer of XXL Energy Corp., a publicly listed Canadian oil and
    gas company, and from August 2008 to December 2008, he served as
    Vice President  Finance of Warrior Energy N.V., a publicly
    listed Canadian oil and gas company. From October 2005 to July
    2006, Mr. Lou was a Director for Macquarie Investment Bank.
    Prior to joining Macquarie, Mr. Lou was a Vice President
    for First Albany Investment Banking from 2004 to 2006. From 1999
    to 2004, Mr. Lou held positions of increasing
    responsibility, most recently as a Vice President, for Bank of
    America's investment banking group. From 1997 to 1999,
    Mr. Lou was an analyst for Merrill Lynch's investment
    banking group. Mr. Lou holds a Bachelor of Science in
    Electrical Engineering from Southern Methodist University.
Roy W. Mace
has served as our Senior Vice President,
    Chief Accounting Officer and Corporate Secretary (or in similar
    capacities) since our inception in March 2007 and has
    28 years of experience in the oil and gas industry. He
    previously served as Business Process Improvement &
    Integration Advisor with ConocoPhillips from March 2006 to March
    2007. Prior to joining ConocoPhillips, Mr. Mace was a
    Senior Accounting Manager with Burlington from June 1999 to
    March 2006. Upon starting his career with Burlington as a Senior
    Corporate Auditor, Mr. Mace advanced into various
    managerial accounting positions at Burlington during the period
    from August 1986 to June 1999 . Prior to joining Burlington,
    Mr. Mace worked as an Assistant Controller for Permian
    Tank & Manufacturing from June 1984 to August
    1986 and as a staff accountant for KPMG from July 1982 to June
    1984. Mr. Mace holds a Bachelor of Business Administration
    and Accounting from Eastern New Mexico University and is a
    licensed Certified Public Accountant.
H. Brett Newton
has served as our Senior Vice
    President Asset Management (or in similar capacities) since
    October 2007 and has 21 years of experience in the oil and
    gas industry. He previously served as Business Development and
    Partner Operations Manager  Algeria with ConocoPhillips
    from April 2006 to September 2007. Prior to joining
    ConocoPhillips, Mr. Newton was Asset Manager  North
    Africa with Burlington from May 2004 to March 2006 and held
    various engineering positions with Burlington from June 1994 to
    April 2004. Prior to joining Burlington, Mr. Newton worked
    for Chevron from January 1989 to June 1994. Mr. Newton has
    worked projects in several regions of the world, including the
    Berkine Basin (Algeria), the Permian Basin, the Green River
    Basin and the Williston Basin. Mr. Newton holds a Bachelor
    of Science from Texas A&M University and a Master of
    Science from the University of Texas at Austin, both in
    Petroleum Engineering.
Walter S. Smithwick
has served as our Senior Vice
    President Operations (or in similar capacities) since
    October 2007 and has 26 years of experience in the oil and
    gas industry. He previously served as South Texas Operations
    Manager  Lobo Field with ConocoPhillips from April 2006 to
    June 2007. Prior to joining ConocoPhillips, Mr. Smithwick
    was Asset Manager San Juan Basin with Burlington from May
    2000 to April 2006 and Drilling
    Manager / Superintendent from October 1994 to May
    2000. From 1986 to 1994, Mr. Smithwick held various
    operations and managerial positions with Burlington in several
    regions of the continental United States, including the
    San Juan Basin, Permian Basin and the Anadarko Basin. Prior
    to joining Burlington, Mr. Smithwick worked as a TC Unit
    Manager for Schlumberger from 1979 to 1981 and worked for
    Harkins Drilling Company in 1978. Mr. Smithwick holds a
    Bachelor of Science in Petroleum Engineering from Texas A&M
    University.
Steven C. Ellsberry
has served as our Vice President and
    Assistant Controller (or in similar capacities) since September
    2007 and has 26 years of experience in the oil and gas
    industry. Prior to joining us, Mr. Ellsberry was a
    consultant to energy businesses evaluating new acquisitions,
    integrating or divesting of oil and gas properties, building
    economic models for large gas gathering systems and assisting in
    our startup. At Burlington, Mr. Ellsberry had over
    20 years of mergers and acquisitions experience responsible
    for due diligence, financial evaluations and back office
    integration. In addition, Mr. Ellsberry managed accounting,
    internal audit and information technology functions for
    Burlington. Mr. Ellsberry was a licensed Certified Public
    Accountant from 1988 to 2007 and holds a Bachelor of Science in
    Electrical Engineering from the University of Texas in Austin.
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Dean A. Gilbert
has served as our Vice President
    Development Geology (or in similar capacities) since September
    2007. Prior to joining us, Mr. Gilbert was associated with
    The Scotia Group as Geoscience Manager from January 2001 to
    September 2007. In that capacity, he was involved in a variety
    of projects in the United States, both continental and offshore,
    as well as internationally. International areas included Mexico,
    South America, Indonesia and offshore West Africa. Prior to
    joining The Scotia Group, Mr. Gilbert held various
    geological positions with Burlington, Louisiana Land and
    Exploration and Union Texas Petroleum. He has over 33 years
    of geological and geophysical experience in the oil and gas
    industry. Mr. Gilbert holds a Bachelor of Arts degree in
    geology from Rice University in Houston.
Thomas F. Hawkins
has served as our Vice President Land
    and Contracts (or in similar capacities) since March 2009 and
    has 32 years of experience in the oil and gas industry.
    Mr. Hawkins retired from ConocoPhillips Company in February
    2009 after spending 31 years with ConocoPhillips and
    Burlington (which ConocoPhillips acquired in 2006). During that
    time, Mr. Hawkins held various operations and managerial
    positions in the Land, Marketing, Planning and Corporate
    Acquisitions and Divestitures groups. Mr. Hawkins has
    worked in several major regions in the continental United
    States, including the San Juan Basin in New Mexico, the
    Williston Basin and the Austin Chalk / Wilcox Trends
    in South Texas. Mr. Hawkins holds a Bachelor of Business
    Administration in Finance from the University of Texas at
    El Paso.
Robin E. Hesketh
has served as our Vice President
    Operations Engineering (or in similar capacities) since April
    2007 and has 29 years of experience in the oil and gas
    industry. Prior to joining us, he was a Principal Engineer with
    ConocoPhillips. He was the Drilling and Completions Manager with
    Burlington China from June 2004 to March 2006, and an Advisor
    Engineer with Burlington from 1993 to 2004 working in Corporate
    Acquisitions and Operations positions in various divisions.
    Prior to that, Mr. Hesketh worked in Operations engineering
    around the globe for British Gas and Hamilton Brothers
    Oil & Gas. He started his career with Sohio Alaska
    Petroleum Company working as a field engineer in Prudhoe Bay
    Alaska. Mr. Hesketh holds a Bachelor of Science in
    Petroleum Engineering from the Colorado School of Mines.
Robert L. Stovall
has served as our Vice President
    Geophysics (or in similar capacities) since inception in March
    2007 and has 27 years of experience in the oil and gas
    industry working both exploration and development projects.
    Prior to joining us, Mr. Stovall was Senior Geophysical
    Advisor at Apache Corporation in International New Ventures from
    September 2006 to March 2007. Mr. Stovall spent
    11 years at Burlington with his last assignment being
    Senior Geophysical Advisor evaluating exploration, development,
    and new ventures in several Latin America countries, West Africa
    and China. Prior to that assignment, Mr. Stovall was
    responsible for Burlington projects in the Gulf of Mexico and
    the Anadarko Basin. Before joining Burlington in 2006,
    Mr. Stovall spent 12 years at Conoco as a geophysicist
    covering projects in the Former Soviet Union, the North Sea,
    Australia, West Africa, and in the Portfolio Management Group.
    Mr. Stovall has a Master of Science degree from Virginia
    Tech and a Bachelor of Science Degree from the University of
    Montana. He is also a Certified Professional Geophysicist.
Board of
    Directors
Our board of directors currently consists of four members,
    including our President and Chief Executive Officer, our
    Executive Vice President and Chief Operating Officer, and two
    members designated by EnCap, which together with its affiliates
    controls a majority of the voting power of our outstanding
    common stock. Each of our current directors has significant
    industry experience.
At the time we complete this offering, we expect to have one new
    independent director who will serve as chairman of our audit
    committee. We expect to add another independent director to our
    board of directors and audit committee within 90 days after
    the completion of this offering and a third independent director
    within one year after the completion of this offering. We also
    expect that our board will review the independence of our
    current directors using the independence standards of the NYSE
    and, based on this review, determine that Messrs. Swanson
    and Zorich are independent within the meaning of the NYSE
    listing standards currently in effect. As a result, we expect
    that our board of directors will consist of seven members within
    one year after the completion of this offering, five of whom
    will be independent. Because OAS Holdco will own a majority of
    our outstanding common stock following the completion of this
    offering, we will be a "controlled company" as that
    term is set forth in Section 303A of the NYSE Listed
    Company Manual. Under the NYSE rules, a
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"controlled company" may elect not to comply with
    certain NYSE corporate governance requirements, including:
    (1) the requirement that a majority of our board of
    directors consist of independent directors, (2) the
    requirement that our nominating and corporate governance
    committee be composed entirely of independent directors with a
    written charter addressing the committee's purpose and
    responsibilities, and (3) the requirement that our
    compensation committee be composed entirely of independent
    directors with a written charter addressing the committee's
    purpose and responsibilities. While these requirements will not
    apply to us as long as we remain a "controlled
    company," as a result of the independent directors that we
    expect to add prior to and within one year following the
    completion of this offering, we expect that our board of
    directors will nonetheless consist of a majority of independent
    directors and that our nominating and corporate governance
    committee and compensation committee will consist entirely of
    independent directors. We also expect that our nominating and
    corporate governance committee and compensation committee will
    each have a written charter addressing such committee's
    purpose and responsibilities.
In evaluating director candidates, we will assess whether a
    candidate possesses the integrity, judgment, knowledge,
    experience, skills and expertise that are likely to enhance the
    board's ability to manage and direct the affairs and
    business of the company, including, when applicable, to enhance
    the ability of committees of the board to fulfill their duties.
Following the completion of this offering, our directors will be
    divided into three classes serving staggered three-year terms.
    Class I, Class II and Class III directors will
    serve until our annual meetings of stockholders in 2011, 2012
    and 2013, respectively. The Class I directors are
    Messrs.          
    and          ,
    the Class II directors are
    Messrs.          
    and          
    and the Class III directors are
    Messrs.          
    and          .
    At each annual meeting of stockholders held after the initial
    classification, directors will be elected to succeed the class
    of directors whose terms have expired. This classification of
    our board of directors could have the effect of increasing the
    length of time necessary to change the composition of a majority
    of the board of directors. In general, at least two annual
    meetings of stockholders will be necessary for stockholders to
    effect a change in a majority of the members of the board of
    directors.
Committees
    of the Board of Directors
Upon the conclusion of this offering, we intend to have an audit
    committee, compensation committee and nominating and governance
    committee at our board of directors, and may have such other
    committees as the board of directors shall determine from time
    to time. Each of the standing committees of the board of
    directors will have the composition and responsibilities
    described below.
Audit
    Committee
We will establish an audit committee prior to completion of this
    offering. We anticipate that the audit committee will consist of
    three directors, each of whom will be independent under the
    rules of the SEC. SEC rules also require that a public company
    disclose whether or not its audit committee has an "audit
    committee financial expert" as a member. An "audit
    committee financial expert" is defined as a person who,
    based on his or her experience, possesses the attributes
    outlined in such rules. We anticipate that at least one of our
    independent directors will satisfy the definition of "audit
    committee financial expert."
This committee will oversee, review, act on and report on
    various auditing and accounting matters to our board of
    directors, including: the selection of our independent
    accountants, the scope of our annual audits, fees to be paid to
    the independent accountants, the performance of our independent
    accountants and our accounting practices. In addition, the audit
    committee will oversee our compliance programs relating to legal
    and regulatory requirements. Upon formation of the audit
    committee, we expect to adopt an audit committee charter
    defining the committee's primary duties in a manner
    consistent with the rules of the SEC and NYSE or market
    standards.
Compensation
    Committee
We will establish a compensation committee prior to completion
    of this offering. We anticipate that the compensation committee
    will consist of three directors, each of whom will be
    "independent" under the rules
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of the SEC. This committee will establish salaries, incentives
    and other forms of compensation for officers and other
    employees. Our compensation committee will also administer our
    incentive compensation and benefit plans. Upon formation of the
    compensation committee, we expect to adopt a compensation
    committee charter defining the committee's primary duties
    in a manner consistent with the rules of the SEC and NYSE or
    market standards.
Nominating
    and Corporate Governance Committee
We will establish a nominating and corporate governance
    committee shortly after completion of this offering. We
    anticipate that the nominating and corporate governance
    committee will consist of three directors. This committee will
    identify, evaluate and recommend qualified nominees to serve on
    our board of directors, develop and oversee our internal
    corporate governance processes and maintain a management
    succession plan. Upon formation of the nominating and corporate
    governance committee, we expect to adopt a nominating and
    corporate governance committee charter defining the
    committee's primary duties in a manner consistent with the
    rules of the SEC and NYSE or market standards.
Compensation
    Committee Interlocks and Insider Participation
None of our officers or employees will be members of the
    compensation committee. None of our executive officers serve on
    the board of directors or compensation committee of a company
    that has an executive officer that serves on our board or
    compensation committee. No member of our board is an executive
    officer of a company in which one of our executive officers
    serves as a member of the board of directors or compensation
    committee of that company.
To the extent any members of our compensation committee and
    affiliates of theirs have participated in transactions with us,
    a description of those transactions is described in
    "Certain Relationships and Related Party Transactions."
Code of
    Business Conduct and Ethics
Our board of directors will adopt a code of business conduct and
    ethics applicable to our employees, directors and officers, in
    accordance with applicable U.S. federal securities laws and
    the corporate governance rules of the NYSE. Any waiver of this
    code may be made only by our board of directors and will be
    promptly disclosed as required by applicable U.S. federal
    securities laws and the corporate governance rules of the NYSE.
Corporate
    Governance Guidelines
Our board of directors will adopt corporate governance
    guidelines in accordance with the corporate governance rules of
    the NYSE.
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EXECUTIVE
    COMPENSATION AND OTHER INFORMATION
Compensation
    Discussion and Analysis
This compensation discussion and analysis, or CD&A,
    provides information about our compensation objectives and
    policies for our principal executive officer, our principal
    financial officer and our other three most highly-compensated
    executive officers, and is intended to place in perspective the
    information contained in the executive compensation tables that
    follow this discussion. This CD&A provides a general
    description of our compensation program and specific information
    about its various components.
Throughout this discussion, the following individuals are
    referred to as the "Named Executive Officers" and are
    included in the Summary Compensation Table:
•
Thomas B. Nusz, Chairman, President and Chief Executive Officer;
•
Taylor L. Reid, Executive Vice President and Chief Operating
    Officer;
•
Roy W. Mace, Senior Vice President, Chief Accounting Officer and
    Corporate Secretary;
•
Kent O. Beers, Senior Vice President Land; and
•
Walter S. Smithwick, Senior Vice President Operations.
Although this CD&A focuses on the information in the tables
    below and related footnotes, as well as the supplemental
    narratives relating to the last completed fiscal year, we also
    describe compensation actions taken before or after the last
    completed fiscal year to the extent such discussion enhances the
    understanding of our executive compensation disclosure.
    Contemporaneous with this offering, we anticipate making
    adjustments to our compensatory practices to be utilized in 2010
    and later years that we believe will be more appropriate for a
    company with public stockholders. This CD&A discusses the
    compensatory practices in place during 2009 and highlights
    changes we will implement upon the consummation of this offering.
Compensation
    Program Philosophy and Objectives
Our future success and the ability to create long-term value for
    our stockholder depends on our ability to attract, retain and
    motivate the most qualified individuals in the oil and gas
    industry. Our compensation program is designed to reward
    performance that supports our long-term strategy and achievement
    of our short-term goals. We believe that compensation should:
•
help to attract and retain the most qualified individuals in the
    oil and gas industry by being competitive with compensation paid
    to persons having similar responsibilities and duties in other
    companies in the same and closely related industries;
•
align the interests of the individual with those of our
    stockholders and long-term value creation;
•
be directly tied to the attainment of our annual performance
    targets and reflect individual contribution thereto;
•
pay for performance, whereby an individual's total
    compensation is heavily influenced by the company's and
    individual's performance; and
•
reflect the unique qualifications, skills, experience and
    responsibilities of each individual.
Although not formally adopted as objectives in 2009 and prior
    years, the preceding objectives are consistent with the informal
    objectives we have employed historically.
Setting
    Executive Officer Compensation
From our inception in 2007 through 2009, the base compensation
    of our Named Executive Officers has remained relatively
    unchanged and was based largely on each executive officer's
    base compensation level at prior positions, although some
    adjustments were made as we deemed necessary to maintain
    internal equity with respect to the compensation of all
    executive officers.
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For 2010, Mr. Nusz, our Chief Executive Officer, and
    Mr. Reid, our Chief Operating Officer, have together
    reviewed our Named Executive Officers' current compensation
    and have made a recommendation to our board of directors on
    overall compensation structure and individual compensation
    levels for each executive officer, including themselves, to be
    effective contemporaneous with this offering. Their
    recommendation was made based on the experience of Mr. Nusz
    and Mr. Reid in managing executives and establishing
    compensation, as well as the use of a peer group comparison. See
    "— Benchmarking and Peer Group" below. Our
    board of directors has approved this recommendation, which will
    become effective upon the consummation of this offering.
Our board of directors does not currently have a separate
    Compensation Committee due to the size of our existing board of
    directors and the lack of independent directors. However, upon
    consummation of this offering, our board of directors will have
    a Compensation Committee that will determine the compensation of
    our Named Executive Officers for future years. We currently
    expect that our Compensation Committee will generally target the
    50th percentile for base salary and will target a higher 75th
    percentile for total compensation, subject to target performance
    metrics being satisfied. Although our Compensation Committee
    will review survey information as a frame of reference,
    ultimately the compensation decisions will be qualitative, not
    quantitative, and will take into consideration in material part
    factors such as the age of the data in the survey, the
    particular officer's contribution to our financial
    performance and condition, as well as such officer's
    qualifications, skills, experience and responsibilities. We
    expect outside factors to be considered as well, such as
    industry shortages of qualified employees for such positions,
    recent experience in the marketplace, and the elapsed time
    between the surveys used and our compensation decisions are
    made. Therefore, we expect that the final base salary of a
    particular officer may be greater or less than the 50th
    percentile and targeted total compensation may be greater or
    less than the
    75
th
percentile.
Benchmarking and Peer Group.
Historically,
    neither our board of directors nor our management has used peer
    group analysis or benchmarking for executive compensation
    purposes.
For 2010, our Chief Executive Officer, Chief Operating Officer,
    and Senior Vice President Finance met with representatives from
    Longnecker & Associates, our compensation consultant,
    to select a group of companies that they consider a "peer
    group" for executive compensation analysis purposes. This
    peer group was then used for purposes of developing the
    recommendations presented to our board of directors for
    compensation packages that will become applicable to our Named
    Executive Officers upon the closing of this offering. The oil
    and gas companies that comprise this peer group were selected
    primarily because they (i) have similar annual revenue,
    assets and market capitalization as us and (ii) potentially
    compete with us for executive talent. Longnecker &
    Associates compiled compensation data for the peer group from a
    variety of sources, including proxy statements and other
    publicly filed documents. Longnecker & Associates also
    provided published survey compensation data from multiple
    sources. This compensation data was then used to compare the
    compensation of our Named Executive Officers to comparably
    titled persons at companies within our peer group and in the
    survey data, generally targeting base salaries for our Named
    Executive Officers which are at the
    50
th
percentile of our peer group, and targeting annual cash and
    long-term incentives so that our Named Executive Officers will
    have the opportunity to realize total compensation at the
    75
th
percentile of our peer group based on both company and
    individual performance.
The 2010 peer group for compensation purposes consists of:
•
Abraxas Petroleum Corporation
•
GeoMet, Inc.
•
Approach Resources, Inc.
•
GMX Resources, Inc.
•
Arena Resources, Inc.
•
Goodrich Petroleum Corporation
•
Brigham Exploration Company
•
Gulfport Energy Corporation
•
Carrizo Oil and Gas, Inc.
•
Panhandle Oil & Gas, Inc.
•
Crimson Exploration, Inc
•
RAM Energy Resources, Inc.
•
Delta Petroleum Corporation
•
Rex Energy Corporation
•
Double Eagle Petroleum Company
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Beginning in 2011, we anticipate that our Compensation Committee
    will review and re-determine annually the composition of our
    peer group so that the peer group will continue to consist of
    oil and gas exploration and production companies (i) with
    annual revenue, assets and market capitalization similar to us
    and (ii) who potentially compete with us for executive
    talent.
Role of the Compensation Consultant.
From our
    inception through 2009, neither management nor our board of
    directors engaged a compensation consultant. For 2010, the
    company retained, independent of our board of directors,
    Longnecker & Associates as an independent compensation
    consultant to assist us in developing the non-employee director
    and executive compensation program to be implemented
    contemporaneously with this offering. Representatives from
    Longnecker & Associates have met with our board of
    directors and have advised the board of directors with regard to
    general trends in director and executive compensation matters,
    including (i) competitive benchmarking; (ii) incentive
    plan design; (iii) peer group selection; and
    (iv) other matters relating to executive compensation. In
    addition, Longnecker & Associates has provided our
    management with survey compensation data regarding our peer
    group. We anticipate that the charter of our Compensation
    Committee will grant the committee the sole authority to retain,
    at our expense, outside consultants or experts to assist it in
    its duties.
Elements
    of our Compensation and Why We Pay Each Element
From our inception through 2009, our compensation program
    consisted of base salary and an annual performance-based cash
    bonus only. In addition, our Named Executive Officers and
    certain other employees have had the opportunity to invest their
    own funds in Oasis Petroleum Management LLC, which owns an
    interest in Oasis Petroleum LLC. See "Corporate
    Reorganization — Oasis Management LLC." Following
    the consummation of this offering, we expect that the
    compensation program for our Named Executive Officers will be
    comprised of four elements: base salary, annual
    performance-based cash incentive awards, long-term equity-based
    compensation and other employee benefits.
Base Salary.
Base salary is the fixed annual
    compensation we pay to each Named Executive Officer for
    performing specific job responsibilities. It represents the
    minimum income a Named Executive Officer may receive in any
    year. Contemporaneous with the consummation of this offering, we
    will implement salary increases for our Named Executive Officers
    in order to bring their base salaries in line with similarly
    titled executives at other companies within our peer group. For
    Named Executive Officers other than Messrs. Nusz and Reid,
    the salary increases are fairly small and ranged up to 11.4% of
    their fiscal 2009 salary. Mr. Beers will not receive a
    salary increase. Because of the increased responsibility of
    Messrs. Nusz and Reid with respect to our overall business
    and their greater experience with our company, we will increase
    their base salaries, upon the effectiveness of this offering as
    set forth in the following table:
Percentage of
    50
th
2010 Base
Percentile of
2009 Base Salary
Salary(1)
2010 Peer Group
Thomas B. Nusz
$
220,000
$
325,000
87.8
%
Taylor L. Reid
210,000
275,000
104.3
(1)
2010 base salaries will become effective upon consummation of
    this offering.
We believe the proposed salary increases for our Named Executive
    Officers are necessary in order for us to maintain a competitive
    compensation program following the effectiveness of this
    offering.
We will pay each Named Executive Officer a base salary in
    order to:
•
recognize each executive officer's unique value and
    historical contributions to our success in light of salary norms
    in the industry and the general marketplace,
•
remain competitive for executive talent within our industry,
•
provide executives with sufficient, regularly-paid
    income, and
•
reflect position and level of responsibility.
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In setting annual base salary amounts, we anticipate that our
    Compensation Committee will generally target by position the
    50th percentile of our peer group.
Annual Performance-based Cash Incentive
    Awards.
We have historically utilized, and expect
    to continue to utilize, performance-based annual cash incentive
    awards to reward achievement of performance goals to be
    specified for the company as a whole with a time horizon of one
    year or less.
We include an annual performance-based cash incentive award as
    part of our compensation program because we believe this element
    of compensation helps to:
•
motivate management to achieve key shorter-term corporate
    objectives, and
•
align executives' interests with our stockholders'
    interests.
Each year since our inception, our board of directors has
    approved annual performance incentive program targets based on
    metrics that it believes are relevant for a company of our size
    and growth expectations. These metrics were derived each year
    from our annual capital budgeting process based upon certain
    assumptions made by our management. The weight given to these
    targets and final bonus payments was discretionary during this
    period.
For 2009, the performance metrics used for purposes of our
    annual cash performance incentive program included production
    volumes, capital spending, lease operating expenses, Adjusted
    EBITDA and specified milestones relating to our short and
    long-term strategic objectives, including the successful
    execution of our business plan, securing capital, development
    and management of our project inventory and organizational
    improvements. The Named Executive Officers were each eligible to
    receive maximum annual incentive bonuses equal to 30% of their
    respective 2009 base salaries. The actual results we attained
    for 2009 significantly exceeded our targeted performance goals
    (for example, we targeted annual average daily production
    volumes at 1,193 Boe and attained 1,950 Boe). This is
    due in part to the completion of two acquisitions during 2009
    that were not contemplated at the time our 2009 budget was set
    and that we drilled and participated in more wells during 2009
    than planned in the original budget. As a result of the
    exceptional performance attained in 2009, each Named Executive
    Officer received the maximum bonus amount. In addition, each
    Named Executive Officer received a special cash performance
    bonus amount for fiscal 2009.
For 2010, the annual performance incentive metrics include
    production growth, reserve growth and efficiency, cost structure
    (operating costs and general and administrative expenses),
    Adjusted EBITDA, and specified milestones relating to our short
    and long term strategic objectives, including the successful
    execution of our business plan, securing capital, development
    and management of our project inventory and organizational
    improvements. Certain broad categories such as "reserve
    growth and efficiency" and "cost structure" will
    include specific, quantifiable metrics to be consistent with the
    remaining categories. We have set threshold, target and maximum
    levels for the performance metrics which will dictate the actual
    bonus amounts earned by the Named Executive Officers for 2010.
    If we achieve the target performance metric, the cash incentive
    award will be paid at target levels. In order to create
    additional incentive for exceptional company performance, awards
    can be up to a maximum percentage (which may exceed 100%) of the
    base salary designated for each Named Executive Officer but it
    is not expected that payment at this level would occur in most
    years. In addition, our board of directors retains the ability
    to apply discretion to awards based on extenuating market
    circumstances or individual performance and to modify amounts
    based on safety performance.
For 2010, target awards to our two top executive officers,
    Mr. Nusz and Mr. Reid, are set at 80% and 60%,
    respectively, of 2010 base salary and may range from 40% to 160%
    of 2010 base salary, in the case of Mr. Nusz, and from 30%
    to 120% of 2010 base salary, in the case of Mr. Reid,
    depending on performance relative to specified performance
    metrics and subject to the discretion of our Compensation
    Committee. Target awards for the remaining Named Executive
    Officers are set at 50% of 2010 base salary and may range
    between 25% and 100% of 2010 base salary.
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Following the consummation of this offering, our Compensation
    Committee will determine an appropriate method of evaluating our
    company's achievement relative to various performance
    metrics and will determine if the current categories and
    associated metrics should be adjusted for future fiscal years.
Long-Term Equity Based
    Incentives.
Historically, our compensation
    structure has not included equity awards or other long-term
    incentive compensation, other than the opportunity of Named
    Executive Officers and other employees to invest their own funds
    in Oasis Petroleum Management LLC, which owns an interest in
    Oasis Petroleum LLC. This has allowed our Named Executive
    Officers to share in the benefits associated with our long-term
    growth. For 2010 and later years, we believe it is important and
    more consistent with the compensation programs of the companies
    in our peer group to establish a more formal long-term equity
    incentive program. As a result, we have adopted a Long-Term
    Incentive Plan, or LTIP, that permits the grant of our stock,
    options, restricted stock, restricted stock units, performance
    award, phantom stock, stock appreciation rights and other
    awards, subject to performance or other conditions, to our Named
    Executive Officers and other eligible employees in 2010 and
    later years. See "— Long-Term Incentive
    Plan." Going forward, we believe that long-term
    equity-based incentive compensation will be an important
    component of our overall compensation program because it will:
•
balance short and long-term objectives;
•
align our executives' interests with the long-term
    interests of our stockholders;
•
reward long-term performance relative to industry peers;
•
remain competitive from a total remuneration standpoint;
•
encourage executive retention; and
•
give executives the opportunity to share in our long-term
    performance.
Our Compensation Committee will have the authority under the
    LTIP to award incentive compensation to our executive officers
    in such amounts and on such terms as the committee determines
    appropriate in its sole discretion. Initially, our long-term
    equity based incentive compensation will consist of annual
    restricted stock awards; however, our Compensation Committee may
    determine in the future that different
and/or
additional award types are appropriate.
Beginning in fiscal 2010, we expect to award annual restricted
    stock awards. We believe this type of award, that will vest
    ratably over a three-year period provided the award recipient
    remains continuously employed through the vesting dates, aligns
    our executive officers with the interests of our stockholders on
    a long-term basis and has retentive attributes.
For 2010, our board of directors has approved target restricted
    stock awards for our two top executive officers, Mr. Nusz
    and Mr. Reid, which will be comprised of a number of shares
    with an aggregate value on the date of grant equal to 120% and
    100%, respectively, of the officers' 2010 base salaries.
    Awards for the remaining Named Executive Officers have been set
    at 75% of their respective 2010 base salaries.
In addition to the 2010 annual award grants, our board of
    directors has approved initial awards of restricted stock to
    executive officers and key employees, including the Named
    Executive Officers, upon consummation of this offering of a
    number of shares with an aggregate grant date value equal to
    100% of each individual's post-IPO annualized base salary.
    These initial restricted stock awards will vest over three years
    with the initial
one-third
tranche vesting in January 2011, provided the award recipient
    remains continuously employed by us through each vesting date.
Employee Benefits.
In addition to the main
    elements of compensation previously discussed in this section,
    the Named Executive Officers are eligible for the same health,
    welfare and other employee benefits as are available to all our
    employees generally, which include medical and dental insurance,
    short and long-term disability insurance, a health club subsidy
    and a 401(k) plan with a
dollar-for-dollar
match on the first 5% of eligible employee contributions and
    escalating based on credited years of service. We do not sponsor
    any defined benefit pension plan or nonqualified deferred
    compensation arrangements at this time.
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The general benefits offered to all employees (and thus to the
    Named Executive Officers) are reviewed by our board of directors
    each year. Following the consummation of this offering, we will
    provide our Named Executive Officers with financial planning
    assistance benefits that are not available to all other
    employees. In the future, we anticipate that benefits offered
    only to Named Executive Officers will be reviewed by the
    Compensation Committee in conjunction with its annual review of
    executive officer compensation.
How
    Elements of our Compensation Program are Related to Each
    Other
We view the various components of compensation as related but
    distinct and emphasize "pay for performance" with a
    significant portion of total compensation reflecting a risk
    aspect tied to long- and short-term financial and strategic
    goals. Our compensation philosophy is to foster entrepreneurship
    at all levels of the organization by making long-term
    equity-based incentives, currently expected to be in the form of
    restricted stock grants, a significant component of executive
    compensation. We determine the appropriate level for each
    compensation component based in part, but not exclusively, on
    our view of internal equity and consistency, and other
    considerations we deem relevant, such as rewarding extraordinary
    performance. We have not adopted any formal or informal policies
    or guidelines for allocating compensation between long-term and
    currently paid out compensation, between cash and non-cash
    compensation, or among different forms of non-cash compensation.
    However, we believe that the compensation packages we will
    implement concurrently with the consummation of this offering
    are representative of an appropriate mix of compensation
    elements, and anticipate that our Compensation Committee will
    utilize a similar, though not identical, mix of compensation in
    future years. The approximate allocation of compensation
    elements in the proposed 2010 compensation packages for each
    Named Executive Officer is as follows:
Other Named
Thomas B. Nusz
Taylor L. Reid
Executive Officers
Base Salary
33.0
%
38.5
%
44.5
%
Annual Cash Incentive Bonus
27.0
23.0
22.0
Restricted Stock Awards
40.0
38.5
33.5
Total
100.0
%
100.0
%
100.0
%
Accounting
    and Tax Considerations
Under Section 162(m) of the Internal Revenue Code of 1986,
    as amended, or the Code, a limitation was placed on tax
    deductions of any publicly-held corporation for individual
    compensation to certain executives of such corporation exceeding
    $1,000,000 in any taxable year, unless the compensation is
    performance-based. An exception applies to this deductibility
    limitation for a limited period of time in the case of companies
    that become publicly-traded.
We reserve the right to use our judgment to authorize
    compensation payments that do not comply with the exemptions in
    Section 162(m) when we believe that such payments are
    appropriate and in the best interest of the stockholders, after
    taking into consideration changing business conditions or the
    executive's individual performance
and/or
changes in specific job duties and responsibilities. During
    2009, the compensation level for none of our Named Executive
    Officers exceeded the tax deductible limitations under
    Section 162(m).
If an executive is entitled to nonqualified deferred
    compensation benefits that are subject to Section 409A of
    the Code, and such compensation does not comply with
    Section 409A, then the benefits are taxable in the first
    year they are not subject to a substantial risk of forfeiture
    and are subject to certain additional adverse tax consequences.
    We intend to design such arrangements to comply with
    Section 409A.
All equity awards to our employees, including executive
    officers, and to our directors will be granted and reflected in
    our consolidated financial statements, based upon the applicable
    accounting guidance, at fair market value on the grant date in
    accordance with Financial Accounting Standards Board (FASB)
    Accounting Standards Codification, Topic 718,
    "Compensation — Stock Compensation."
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Employment
    Agreements
Contemporaneous with this offering, we will enter into
    employment agreements with Messrs. Nusz and Reid, effective
    as of the completion of this offering. These employment
    agreements are designed to ensure an individual understanding of
    how the employment relationship may be extended or terminated,
    the compensation and benefits that we provide during the term of
    employment and the obligations each party has in the event of
    termination of an officer's employment. We expect the
    remainder of our employees to remain "at will." In
    consultation with our compensation consultant,
    Longnecker & Associates, we determined that due to the
    historical roles they have played in the success and growth of
    the company, Messrs. Nusz and Reid are critical to the
    ongoing stability and development of the business and therefore,
    entering into employment agreements with these individuals is
    advisable.
The employment agreements provide for an initial three-year term
    that will be automatically renewed for successive one-year
    periods unless we give notice to the executive of non-renewal at
    least 60 days prior to the last day of the then-current
    term. The employment agreements provide that Messrs. Nusz
    and Reid will receive annual base salaries of $325,000 and
    $275,000, respectively, which may be increased by our board of
    directors in its discretion. The employment agreements also
    provide that Messrs. Nusz and Reid are eligible to receive
    annual performance-based bonuses each year during the employment
    term. The target amount of each annual bonus is 80% for
    Mr. Nusz and 60% for Mr. Reid of the executive's
    base salary for the year, and greater or lesser amounts may be
    paid depending on the performance actually achieved. See
    "— Elements of Our Compensation and Why We Pay
    Each Element — Annual Performance-based Cash Incentive
    Awards." The employment agreements also provide
    Messrs. Nusz and Reid with the opportunity to participate
    in the employee benefit arrangements offered to similarly
    situated executives and provide that they may periodically
    receive grants pursuant to our long-term incentive compensation
    plan.
The employment agreements provide for severance and change in
    control benefits to be paid to Messrs. Nusz and Reid under
    certain circumstances. The severance benefits are provided to
    reflect the fact that it may be difficult for executive officers
    to find comparable employment within a short period of time if
    they are involuntarily terminated. Change in control benefits
    are provided in order that the executives may objectively assess
    and pursue aggressively our interests and the interests of our
    stockholders with respect to a contemplated change in control,
    free from personal, financial and employment considerations. The
    employment agreements also impose certain non-compete,
    non-disclosure and similar obligations on the executives. The
    severance and change in control benefits and the
    post-termination obligations imposed on the executives are
    described in greater detail below. See
    "— Executive Compensation — Potential
    Payments Upon Termination and Change in Control."
Severance
    and Change in Control Arrangements
Messrs. Nusz and Reid are currently parties to an Ancillary
    Agreement, dated as of March 5, 2007, pursuant to which
    they are entitled to receive certain severance benefits upon an
    involuntary termination without cause or for good reason. These
    severance benefits are described in greater detail below in the
    section entitled "— Executive
    Compensation — Potential Payments Upon Termination and
    Change in Control." The Ancillary Agreement will terminate
    upon the consummation of this offering and will be of no further
    force or effect.
Other than the Ancillary Agreement entered into with
    Messrs. Nusz and Reid, we did not have any agreements in
    place providing severance or change in control benefits to our
    executive officers during 2009 and prior years. As described
    above, contemporaneous with the closing of this offering, the
    employment agreements will provide certain benefits and
    compensation to Messrs. Nusz and Reid in the event of
    certain terminations from employment, including in connection
    with a change in control. These benefits are described in
    greater detail above and in the section below entitled
    "— Executive Compensation — Potential
    Payments Upon Termination and Change in Control."
For executive officers other than Messrs. Nusz and Reid, we
    expect the Compensation Committee will adopt an Executive
    Severance Plan and an Executive Change in Control Plan to
    provide severance and change in control benefits to our other
    executive officers for periods of time following the
    consummation of this
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offering. These two plans will ensure an understanding of what
    benefits are to be paid to the other executive officers in the
    event of their termination or a change in control. For these
    executive officers, post-employment obligations regarding the
    use of confidential
and/or
proprietary information will be imposed through our broader
    policies covering all employees.
We expect that, in deciding to implement the Executive Severance
    Plan and the Executive Change in Control Plan, our Compensation
    Committee will determine that the interests of our stockholders
    are best served if we provide separation benefits to eliminate,
    or at least reduce, the reluctance of executive officers to
    pursue potential corporate transactions that may be in the best
    interests of our stockholders, but that may have resulting
    adverse consequences to the executive officers' employment
    situations.
Gross-Ups.
Under
    the employment agreements with Messrs. Nusz and Reid, and
    under our expected Executive Change in Control Plan in which the
    other executive officers will participate, if benefits to which
    the Named Executive Officers become entitled in connection with
    a change in control are considered "excess parachute
    payments" under Section 280G of the Code, then the
    Named Executive Officers would be entitled to an additional
gross-up
payment from us, unless the aggregate amount of the payments due
    to the executive in connection with a change in control may be
    reduced by 10% or less and fall within the safe harbor amount
    for Section 280G purposes such that no excise taxes are
    imposed, in which event, the payments to an executive will be so
    reduced. If a reduction of more than 10% would be needed in
    order for the payments to be within the Section 280G safe
    harbor, then no reduction in the payment amounts will be made
    and the executive will receive a gross-up payment in an amount
    such that, after payment by the Named Executive Officer of all
    taxes including any excise tax imposed upon the
gross-up
payment, the Named Executive Officer would retain an amount
    equal to the excise tax imposed upon the payment.
Stock
    Ownership Guidelines
Stock ownership guidelines have not been implemented for our
    Named Executive Officers or directors. We will continue to
    periodically review best practices and reevaluate our position
    with respect to stock ownership guidelines.
Securities
    Trading Policy
Our securities trading policy provides that executive officers,
    including the Named Executive Officers, and our directors, may
    not, among other things, purchase or sell puts or calls to sell
    or buy our stock, engage in short sales with respect to our
    stock, buy our securities on margin, or otherwise hedge their
    ownership of our stock. The purchase or sale of stock by our
    executive officers and directors may only be made during certain
    windows of time and under the other conditions contained in our
    policy.
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Executive
    Compensation
Summary
    Compensation Table
The following table shows information concerning the annual
    compensation for services provided to us by our Named Executive
    Officers during the fiscal year ended December 31, 2009.
All Other
Bonus
Compensation
Name and Principal Position
Year
Salary
(1)
(2)
Total
Thomas B. Nusz
2009
$
220,000
$
543,167
$
2,589
$
765,756
Chairman, President and Chief Executive Officer
Taylor L. Reid
2009
210,000
329,000
1,907
540,907
Executive Vice President and Chief Operating Officer
Roy W. Mace
2009
158,750
99,167
1,298
259,215
Senior Vice President, Chief Accounting Officer and Corporate
    Secretary
Kent O. Beers
2009
225,000
193,000
632
418,632
Senior Vice President Land
Walter S. Smithwick
2009
190,000
127,000
—
317,000
Senior Vice President Operations
(1)
Reflects amounts paid for services provided in fiscal year 2009
    pursuant to annual performance targets reviewed and weighted at
    the direction of our board of directors. Also reflects cash
    amounts paid as a special performance bonus for 2009.
(2)
The following items are reported in the "All Other
    Compensation" column:
Oasis Petroleum LLC
All Other Compensation
Year Ended December 31, 2009
All Other
Employee
Health Club
Parking
Transit
Compensation
Thomas B. Nusz
$
1,366
$
1,223
$
—
$
2,589
Taylor L. Reid
684
1,223
—
1,907
Roy W. Mace
750
—
548
1,298
Kent O. Beers
632
—
—
632
Walter S. Smithwick
—
—
—
—
Discussion
    of Summary Compensation Table
Our executive compensation policies and practices, pursuant to
    which the compensation set forth in the Summary Compensation
    Table was paid or awarded, are described above in CD&A. As
    indicated therein, our executive compensation for 2009 consisted
    of a base salary, an annual performance based cash incentive
    award of up to 30% of base salary based on the performance of
    the company as a whole, a special 2009 cash performance bonus
    and limited additional compensation amounts.
Grants
    of Plan-based Awards and Outstanding Equity Awards at Fiscal
    Year End
None of our Named Executive Officers received any grants of
    plan-based awards in 2009 or held any outstanding equity awards
    as of December 31, 2009.
Pension
    Benefits
Other than our 401(k) Plan, we do not have any plan that
    provides for payments or other benefits at, following, or in
    connection with, retirement.
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Non-Qualified
    Deferred Compensation
We do not have any plan that provides for the deferral of
    compensation on a basis that is not tax qualified.
Potential
    Payments Upon Termination and Change in Control
Other than the Ancillary Agreement that provides certain
    severance benefits to Messrs. Nusz and Reid upon an
    involuntary termination, there were no arrangements with our
    Named Executive Officers providing such individuals with
    severance or change in control benefits during 2009. The
    severance benefits Messrs. Nusz and Reid would have been
    entitled to receive under the Ancillary Agreement if they were
    involuntarily terminated at the end of fiscal 2009 are described
    in greater detail below.
Contemporaneous with the consummation of this offering, the
    Ancillary Agreement will terminate and the severance benefits
    provided in that agreement will cease to be representative of
    what our Named Executive Officers will be entitled to receive in
    the event they are terminated under certain circumstances or we
    undergo a change in control. As described above, contemporaneous
    with the closing of this offering, we will enter into employment
    agreements with Messrs. Nusz and Reid that contain
    provisions regarding payments to be made to such individuals
    upon termination of their employment in certain circumstances,
    including in connection with a change in control. These
    agreements are described in greater detail below and in the
    section above entitled "Compensation Discussion &
    Analysis — Employment Agreements." We also expect
    that our Compensation Committee will adopt an Executive
    Severance Plan and an Executive Change in Control Plan,
    following the consummation of this offering in which our Named
    Executive Officers, other than Messrs. Nusz and Reid, will
    participate. In order to provide our stockholders with an
    understanding of the severance and change in control benefits
    that will be implemented in connection with this offering, we
    also discuss below the benefits payable under the employment
    agreements, assuming such arrangements were in place at the end
    of fiscal 2009.
Ancillary
    Agreement
Messrs. Nusz and Reid are parties to an Ancillary
    Agreement, dated as of March 5, 2007, that provides each of
    them with certain severance benefits in the event their
    employment is terminated. The Ancillary Agreement will cease to
    be in effect upon the completion of this offering. If the
    executive is terminated by us for "cause" or by the
    executive without "good reason," the executive is
    entitled to receive his accrued but unpaid base salary and any
    expenses eligible for reimbursement. If the executive is
    terminated by us without "cause" or by the executive
    for "good reason," the executive is also entitled to
    receive continued payment of his current base salary for a
    period of 18 months following the termination date.
    Assuming Messrs. Nusz and Reid were terminated without
    "cause" or for "good reason" effective
    December 31, 2009, the executives would have been entitled
    to receive aggregate payments of $330,000 and $315,000,
    respectively, payable in substantially equal installments over
    an
18-month
period.
If Messrs. Nusz and Reid are terminated for any reason
    other than by us upon the occurrence of an "exit
    event," the executive is required to comply with certain
    noncompete and other obligations specified in the Ancillary
    Agreement, provided we continue to pay the executive his salary
    for the next 18 months' as severance. Specifically,
    the executives are required to comply with a noncompete covenant
    for 544 days following termination, a nondisclosure
    covenant for a two year period following termination, and a
    nonsolicitation covenant for 18 months following
    termination. These periods may be extended to account for any
    period of time during which an executive is in breach of the
    foregoing covenants.
For purposes of the Ancillary Agreement, the terms listed below
    have the following meanings:
(a)
"cause"
means (i) the breach by
    the executive of his duties that is materially detrimental to us
    and, if curable, that is not cured within 10 business days
    of notice of such breach, (ii) the executive's failure
    to comply in any material respect with a lawful, written
    direction of the board of managers of Oasis Petroleum LLC
    reasonably related to the executive's duties that he is
    physically able to perform, (iii) the executive's
    conviction of, or plea of nolo contendere to, any felony,
    (iv) the commission of an act
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of fraud, dishonesty or moral turpitude that is reasonably
    likely to cause harm to us or our reputation, (v) the
    executive's habitual insobriety or failure to perform his
    duties due to alcoholism or addiction to controlled substances,
    (vi) any action taken knowingly or with reckless disregard
    that is materially adverse to our interests or assets and
    (vii) a material breach by the executive of any of his
    covenants or agreements in the Ancillary Agreement or in the
    Oasis Petroleum LLC Agreement that, if curable, is not cured
    within five business days of notice of such breach.
(b)
"exit event"
means the sale of the
    company in one transaction or a series of related transactions,
    or structured as a sale or transfer of all or substantially all
    of the membership interests in the company (including by merger,
    consolidation, share exchange or similar transaction) or the
    sale or other transfer of all or substantially all of the assets
    of the company, or a combination of both.
(c)
"good reason"
means (i) the
    assignment to the executive of duties substantially inconsistent
    with his position, duties, responsibility and status,
    (ii) a reduction in the executive's base salary or our
    failure to timely pay base salary, or any other material breach
    by us of our obligations under the Ancillary Agreement,
    (iii) relocation of the executive's employment to a
    location other than the Houston, Texas metropolitan area for a
    material period of time, unless the executive consents or the
    relocation is necessitated by an act of God or certain other
    events, (iv) a person (with certain limited exceptions)
    acquires more than 50% of the voting securities of EnCap
    and more than two of the current partners of EnCap cease to
    be actively involved in the management and conduct of
    EnCap's business and affairs, or (v) the EnCap members
    sell all or substantially all of their membership interests and
    cease to have designated managers to the board of managers of
    Oasis Petroleum LLC constituting a majority thereof.
Employment
    Agreements
Contemporaneous with the consummation of this offering, the
    Ancillary Agreement will terminate and the severance and change
    in control benefits due to Messrs. Nusz and Reid will be
    governed by the proposed employment agreements. Under the
    employment agreements, upon any termination of employment,
    Messrs. Nusz and Reid are entitled to receive accrued but
    unpaid salary, any unpaid annual performance bonus earned for
    the calendar year prior to the year in which the executive
    terminates, reimbursement of eligible expenses and any employee
    benefits due pursuant to their terms. In addition, if
    Messrs. Nusz and Reid are terminated due to death or
    "disability," then they will be entitled to receive
    the following amounts: (i) a pro-rata portion of the annual
    performance bonus for the calendar year of termination,
    (ii) an amount equal to twelve months' worth of the
    executive's base salary, payable in a lump sum within
    60 days or by March 15 of the year following
    termination, whichever is earlier, and (iii) an amount
    equal to 18 months' worth of COBRA premiums, if the
    executive elects and remains eligible for COBRA.
If we terminate the employment of Messrs. Nusz and Reid for
    reasons other than "cause," if we elect not to renew
    the employment agreement with the executive, or if the
    executives terminate employment for "good reason,"
    then Messrs. Nusz and Reid will be entitled to receive the
    following amounts: (i) a pro-rata portion of the annual
    performance bonus for the calendar year of termination,
    (ii) an amount equal to the greater of (a) the
    aggregate amount of base salary payable for the remainder of the
    employment term, and (b) an amount equal to
    12 months' worth of the executive's base salary,
    payable in equal monthly installments (with amounts in excess of
    certain limitations under Section 409A of the code payable
    in a lump sum within 60 days), (iii) an amount equal
    to 18 months' worth of COBRA premiums, if the
    executive elects and remains eligible for COBRA, (iv) an
    amount equal to the aggregate of each annual target performance
    bonus the executive would have been entitled to receive if he
    had continued to perform services for the remainder of the
    employment term, if termination occurs during the initial
    three-year term, or an amount equal to 80% (for Mr. Nusz)
    and 60% (for Mr. Reid) of base salary for the remainder of
    the then-current term, if termination occurs after the initial
    term, in each case minus the amount of the pro-rata bonus paid,
    and (v) accelerated vesting of all outstanding equity
    awards. Severance amounts, other than the pro-rata bonus amount,
    are subject to the executive's delivery to us (and
    nonrevocation) of a release of claims within 60 days of his
    termination date.
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In the event a change in control occurs, all outstanding equity
    awards held by Messrs. Nusz and Reid will be immediately
    vested in full. In addition, in the event Messrs. Nusz and
    Reid are terminated by us other than for "cause," if
    we elect not to renew the employment agreements or if the
    executives terminate employment for "good reason," in
    each case, within 12 months following a "change in
    control," Messrs. Nusz and Reid (or their respective
    estates) are entitled to receive (i) an amount equal to two
    times the sum of (a) the executive's annualized base
    salary and (b) the maximum annual performance bonus he is
    eligible to receive for the then-current year if termination
    occurs during the initial three year term, or an amount equal to
    80% (for Mr. Nusz) and 60% (for Mr. Reid) of base
    salary, if termination occurs after the initial term and
    (ii) an amount equal to 18 month's worth of COBRA
    premiums, if the executive elects and is eligible to receive
    COBRA. If Messrs. Nusz and Reid are terminated in
    connection with a change in control and would receive greater
    benefits under another provision of their employment agreements,
    they will be entitled to receive the greater benefits. Because
    of the tax on so-called "parachute payments" imposed
    by the Code's Section 4999 on payments made in
    connection with a change in control, we have agreed to reimburse
    Messrs. Nusz and Reid for any excise taxes imposed as a
    result of a payment of change in control benefits and to gross
    up those tax payments to keep the executives whole, unless the
    aggregate payments due to the executives may be reduced by 10%
    or less and, following such reduction, will not exceed the safe
    harbor amount under Code Section 280G, in which case the
    payments due will be so reduced.
Messrs. Nusz and Reid are subject to certain
    confidentiality, noncompete and nonsolicitation provisions
    contained in the employment agreements. The confidentiality
    covenants are perpetual, while the noncompete and
    nonsolicitation covenants apply during the term of the
    employment agreements and for 12 months following the
    employee's termination date, except that the latter
    covenants will cease to apply if the executive is terminated for
    any reason on or after a change in control.
For purposes of the employment agreements, the terms listed
    below have been defined as follows:
(i)
"cause"
means (a) the executive
    has been convicted of a misdemeanor involving moral turpitude or
    a felony, (b) the executive has engaged in grossly
    negligent or willful misconduct in performing his duties, which
    has a material detrimental effect on the company, (c) the
    executive has breached a material provision of the employment
    agreement, (d) the executive has engaged in conduct that is
    materially injurious to us or (e) the executive has
    committed an act of fraud. Messrs. Nusz and Reid will have
    a limited period of 30 days to cure events (unless the
    cause event is that described in clause (a) above).
(ii)
"change in control"
means (a) a
    person acquires 50% or more of our outstanding stock or
    outstanding voting securities, (b) individuals who serve as
    board members on the effective date of the employment agreements
    (or who are subsequently approved by a majority of such
    individuals) cease for any reason to constitute at least a
    majority of the board of directors, (c) consummation of a
    reorganization, merger, consolidation or a sale of all or
    substantially all of our assets, subject to certain limited
    exceptions, and (d) approval by our stockholders of a
    complete liquidation or dissolution.
(iii)
"disability"
means the
    executive's inability to perform the executive's
    essential functions with or without reasonable accommodation, if
    required by law, due to physical or mental impairment.
(iv)
"good reason"
means, without the
    executive's express written consent, (a) a material
    breach by us of the employment agreement, (b) a material
    reduction in the executive's base compensation, (c) a
    material diminution in the executive's authority, duties or
    responsibilities, (d) a change in the geographic location
    where executive must normally perform services by more than
    50 miles or (e) requirement that the executive report
    to an employee instead of to our board (for Mr. Nusz) or a
    material reduction in the authority, duties or responsibilities
    of the person to whom the executive reports (for Mr. Reid).
    The executive must notify us within 60 days of the
    occurrence of any such event and we have 30 days following
    notice to cure.
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Quantification
    of Payments
The table below discloses the amount of compensation
and/or
benefits due to the Named Executive Officers in the event of
    their termination of employment
and/or
in
    the event we undergo a change in control. The amounts disclosed
    assume such termination
and/or
the
    occurrence of such change in control was effective
    December 31, 2009, but taking into account the arrangements
    described above that will be entered into or adopted
    contemporaneous with the effectiveness of this offering. The
    amounts below constitute estimates of the amounts that would be
    paid out to the Named Executive Officers upon their respective
    terminations
and/or
upon
    a change in control under such arrangements. The actual amounts
    to be paid out are dependent on various factors, which may or
    may not exist at the time a Named Executive Officer is actually
    terminated
and/or
a
    change in control actually occurs. Therefore, such amounts and
    disclosures should be considered "forward-looking
    statements."
Termination
Without
Cause or
for Good
Reason
Termination Due
Within one
Termination Due
to Non-
Termination
Year of a
to Death or
Extension by
Without Cause or
Change in
Change in
Named Executive Officer
Disability
company
for Good Reason
Control
Control
Thomas B. Nusz
•   Salary
•   Bonus Amounts
•   COBRA Premiums
•   Change in Control Payments
•   Accelerated Equity Vesting
•   Gross-Up
Payments
•   Total
Taylor L. Reid
•   Salary
•   Bonus Amounts
•   COBRA Premiums
•   Change in Control Payments
•   Accelerated Equity Vesting
•   Gross-Up
Payments
•   Total
Long-Term
    Incentive Plan
We expect to adopt a LTIP prior to the consummation of this
    offering in order to attract and retain the best available
    personnel for positions of substantial responsibility, to
    provide additional incentives to our employees, directors and
    consultants, and to promote the success of our business. We
    anticipate that the LTIP will primarily provide for grants of
    (a) incentive stock options qualified as such under
    U.S. federal income tax laws, (b) stock options that
    do not qualify as incentive stock options, (c) stock
    appreciation rights, or SARs, (d) restricted stock awards,
    (e) restricted stock units (f) performance awards, or
    (g) any combination of such awards.
The LTIP is not subject to the Employee Retirement Income
    Security Act of 1974, as amended, or ERISA. The LTIP, for a
    limited period of time following this offering, will qualify for
    an exception to the deductibility limitations imposed by
    Section 162(m) of the Code. As a result, during that
    limited period of time, awards will be exempt from the
    limitations on the deductibility of compensation that exceeds
    $1,000,000.
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Shares Available.
The maximum aggregate
    number of shares of our common stock that may be reserved and
    available for delivery in connection with awards under the LTIP
    is          ,
    subject to adjustment in accordance with the terms of the LTIP.
    If common stock subject to any award is not issued or
    transferred, or ceases to be issuable or transferable for any
    reason, including stock subject to an award that is cancelled,
    forfeited or settled in cash and shares withheld to pay the
    exercise price of or to satisfy the withholding obligations with
    respect to an award, those shares of common stock will again be
    available for delivery under the LTIP to the extent allowable by
    law.
Eligibility.
Any individual who provides
    services to us, including non-employee directors and
    consultants, is eligible to participate in the LTIP (each, an
    "Eligible Person"). Each Eligible Person who is
    designated by the Compensation Committee to receive an award
    under the LTIP will be a "Participant." An Eligible
    Person will be eligible to receive an award pursuant to the
    terms of the LTIP and subject to any limitations imposed by
    appropriate action of the Compensation Committee.
Administration.
Our board of directors has
    appointed the Compensation Committee to administer the LTIP
    pursuant to its terms, except in the event our board of
    directors chooses to take action under the LTIP. Our
    Compensation Committee will, unless otherwise determined by the
    board of directors, be comprised of two or more individuals each
    of whom constitutes an "outside director" as defined
    in Section 162(m) of the Code and "nonemployee
    director" as defined in
Rule 16b-3
under the Exchange Act. Unless otherwise limited, the
    Compensation Committee has broad discretion to administer the
    LTIP, including the power to determine to whom and when awards
    will be granted, to determine the amount of such awards
    (measured in cash, shares of common stock or as otherwise
    designated), to proscribe and interpret the terms and provisions
    of each award agreement, to accelerate the exercise terms of any
    award (provided that such acceleration does not cause an award
    intended to qualify as performance based compensation for
    purposes of Section 162(m) of the Code to fail to so
    qualify), to delegate duties under the LTIP and to execute all
    other responsibilities permitted or required under the LTIP.
Terms of Options.
The Compensation Committee
    may grant options to Eligible Persons including
    (a) incentive stock options (only to our employees) that
    comply with Section 422 of the Code and
    (b) nonstatutory options. The exercise price for an option
    must not be less than the greater of (a) the par value per
    share of common stock or (b) the fair market value per
    share as of the date of grant. Options may be exercised as the
    Compensation Committee determines, but not later than
    10 years from the date of grant. Any incentive stock option
    granted to an employee who possesses more than 10% of the total
    combined voting power of all classes of our shares within the
    meaning of Section 422(b)(6) of the Code must have an
    exercise price of at least 110% of the fair market value of the
    underlying shares at the time the option is granted and may not
    be exercised later than five years from the date of grant.
Terms of SARs.
SARS may be awarded in
    connection with or separate from an option. An SAR is the right
    to receive an amount equal to the excess of the fair market
    value of one share of our common stock on the date of exercise
    over the grant price of the SAR. SARs awarded in connection with
    an option will entitle the holder, upon exercise, to surrender
    the related option or portion thereof relating to the number of
    shares for which the SAR is exercised, which option or portion
    thereof will then cease to be exercisable, in exchange for an
    amount calculated as described in the preceding sentence. Such
    SAR is exercisable or transferable only to the extent that the
    related option is exercisable or transferable. SARs granted
    independently of an option will be exercisable as the
    Compensation Committee determines. The term of an SAR will be
    for a period determined by the Compensation Committee but will
    not exceed ten years. SARs may be paid in cash, common stock or
    a combination of cash and stock, as provided for by the
    Compensation Committee in the award agreement.
Restricted Stock Awards.
A restricted stock
    award is a grant of shares of common stock subject to a risk of
    forfeiture, restrictions on transferability, and any other
    restrictions imposed by the Compensation Committee in its
    discretion. Except as otherwise provided under the terms of the
    LTIP or an award agreement, the holder of a restricted stock
    award may have rights as a stockholder, including the right to
    vote or to receive dividends (subject to any mandatory
    reinvestment or other requirements imposed by the Compensation
    Committee). A restricted stock award that is subject to
    forfeiture restrictions may be forfeited and reacquired by us
    upon
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termination of employment or services. Common stock distributed
    in connection with a stock split or stock dividend, and other
    property distributed as a dividend, may be subject to the same
    restrictions and risk of forfeiture as the restricted stock with
    respect to which the distribution was made.
Restricted Stock Units.
Restricted stock units
    are rights to receive common stock, cash or a combination of
    both at the end of a specified period. Restricted stock units
    may be subject to restrictions, including a risk of forfeiture,
    as specified in the award agreement. Restricted stock units may
    be satisfied by common stock, cash or any combination thereof,
    as determined by the Compensation Committee. Except as otherwise
    provided by the Compensation Committee in the award agreement or
    otherwise, restricted stock units subject to forfeiture
    restrictions will be forfeited upon termination of a
    participant's employment or services prior to the end of
    the specified period. The Compensation Committee may, in its
    sole discretion, grant dividend equivalents with respect to
    restricted stock units.
Other Awards.
Eligible Persons may be granted,
    subject to applicable legal limitations and the terms of the
    LTIP and its purposes, other awards related to common stock.
    Such awards may include, but are not limited to, common stock
    awarded as a bonus, dividend equivalents, convertible or
    exchangeable debt securities, other rights convertible or
    exchangeable into common stock, purchase rights for common
    stock, awards with value and payment contingent upon our
    performance or any other factors designated by the Compensation
    Committee, and awards valued by reference to the book value of
    common stock or the value of securities of or the performance of
    specified subsidiaries. The Compensation Committee will
    determine terms and conditions of all such awards. Cash awards
    may granted as an element of or a supplement to any awards
    permitted under the LTIP. Awards may also be granted in lieu of
    obligations to pay cash or deliver other property under the LTIP
    or under other plans or compensatory arrangements, subject to
    any applicable provision under Section 16 of the Exchange
    Act.
Performance Awards.
The Compensation Committee
    may designate that certain awards granted under the LTIP
    constitute "performance" awards. A performance award
    is any award the grant, exercise or settlement of which is
    subject to one or more performance standards. These standards
    may include business criteria for us on a consolidated basis,
    such as total stockholders' return and earnings per share,
    or for specific subsidiaries or business or geographical units.
Director
    Compensation
We did not award any compensation to our non-employee directors
    during fiscal year 2009. Going forward, the board of directors
    believes that attracting and retaining qualified non-employee
    directors will be critical to the future value growth and
    governance, and that providing a total compensation package
    between the
    50
th
percentile and
    75
th
percentile of our peer group is necessary to accomplish that
    objective. Our board of directors also believes that the
    compensation package for our non-employee directors should
    require a significant portion of the total compensation package
    to be equity-based to align the interests of these directors
    with our stockholders.
After review with Longnecker & Associates of
    non-employee director compensation paid by our peer group, our
    board of directors approved the following compensation plan for
    non-employee directors for the year 2010:
•
an annual cash retainer fee of $40,000, plus cash payments of
    $1,250 for each board of directors' meeting attended and
    $1,000 for each committee meeting attended;
•
an initial equity award
    of           shares
    of restricted stock; and
•
an annual equity award of shares of our restricted stock having
    a value of $70,000 based on the average of the high and low
    market-quoted sales prices of our common stock on the grant date
    of the award.
Both the initial and annual grants of restricted stock will vest
    equally over a three-year period.
In addition, the chairpersons of our Audit Committee,
    Compensation Committee and Nominating & Governance
    Committee will receive annual cash retainer fees of $10,000,
    $5,000 and $5,000, respectively.
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Directors who are also our employees will not receive any
    additional compensation for their service on the board of
    directors.
Each director will be reimbursed for (i) travel and
    miscellaneous expenses to attend meetings and activities of our
    board of directors or its committees; (ii) travel and
    miscellaneous expenses related to such director's
    participation in our general education and orientation program
    for directors; and (iii) travel and miscellaneous expenses
    for each director's spouse who accompanies a director to
    attend meetings and activities of our board of directors or any
    of our committees.
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CERTAIN
    RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Since January 1, 2007, there has not been, nor is there
    currently proposed, any transaction or series of similar
    transactions to which we were or are a party in which the amount
    involved exceeded or exceeds $120,000 and in which any of our
    directors, executive officers, holders of more than 5% of any
    class of our voting securities, or any member of the immediate
    family of any of the foregoing persons, had or will have a
    direct or indirect material interest, other than compensation
    arrangements with directors and executive officers, which are
    described in "Executive Compensation and Other
    Information," and the transactions described or referred to
    below.
Corporate
    Reorganization
In connection with our corporate reorganization, we will engage
    in certain transactions with certain affiliates and our existing
    equity holders. Please see "Corporate Reorganization"
    for a description of these transactions.
Historical
    Transactions with Oasis Petroleum LLC
Since its inception, Oasis Petroleum LLC has issued additional
    membership interests as consideration for capital contributions
    received from its members, including EnCap, Oasis Petroleum
    Management LLC and other private investors. Capital
    contributions  for the years ended December 31, 2009 and
    2008 and the period ended December 31, 2007 were
    $104.6 million, $80.5 million and $49.9 million,
    respectively. In addition, Oasis Petroleum LLC has paid the
    legal fees of EnCap and Oasis Petroleum Management LLC in
    connection with these transactions.
In connection with each of its capital contributions, EnCap
    receives a placement fee in an amount equal to 2% of its capital
    contributions. Such placement fees are remitted by us to EnCap
    or its designee. Placement fees for the years ended
    December 31, 2009 and 2008 and the period ended
    December 31, 2007 were $1.6 million, $1.2 million
    and $1.0 million, respectively.
Procedures
    for Approval of Related Person Transactions
A "Related Party Transaction" is a transaction,
    arrangement or relationship in which we or any of our
    subsidiaries was, is or will be a participant, the amount of
    which involved exceeds $120,000, and in which any related party
    had, has or will have a direct or indirect material interest. A
    "Related Person" means:
•
any person who is, or at any time during the applicable period
    was, one of our executive officers or one of our directors;
•
any person who is known by us to be the beneficial owner of more
    than 5.0% of our common stock;
•
any immediate family member of any of the foregoing persons,
    which means any child, stepchild, parent, stepparent, spouse,
    sibling,
mother-in-law,
father-in-law,
son-in-law,
daughter-in-law,
brother-in-law
or
sister-in-law
of a director or a beneficial owner of more than 5.0% of our
    common stock, and any person (other than a tenant or employee)
    sharing the household of such director or beneficial owner of
    more than 5.0% of our common stock;
•
and any firm, corporation or other entity in which any of the
    foregoing persons is a partner or principal or in a similar
    position or in which such person has a 10.0% or greater
    beneficial ownership interest.
Our board of directors will adopt a written related party
    transactions policy prior to the completion of this offering.
    Pursuant to this policy, the Audit Committee will review all
    material facts of all Related Party Transactions and either
    approve or disapprove entry into the Related Party Transaction,
    subject to certain limited exceptions. In determining whether to
    approve or disapprove entry into a Related Party Transaction,
    the Audit Committee shall take into account, among other
    factors, the following: (1) whether the Related Party
    Transaction is on terms no less favorable than terms generally
    available to an unaffiliated third-party under the same or
    similar circumstances and (2) the extent of the Related
    Person's interest in the transaction. Further, the policy
    requires that all Related Party Transactions required to be
    disclosed in our filings with the SEC be so disclosed in
    accordance with applicable laws, rules and regulations.
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CORPORATE
    REORGANIZATION
Oasis Petroleum Inc. is a Delaware corporation that was formed
    for the purpose of making this offering. Pursuant to the terms
    of a corporate reorganization that will be completed
    concurrently with the closing of this offering, Oasis Petroleum
    Inc. will acquire all of the outstanding membership interests in
    Oasis Petroleum LLC in exchange for shares of Oasis Petroleum
    Inc.'s common stock. Therefore, investors in this offering
    will only receive, and this prospectus only describes the
    offering of, shares of common stock of Oasis Petroleum Inc. Our
    business will continue to be conducted through Oasis Petroleum
    LLC, as a wholly owned subsidiary of Oasis Petroleum Inc. See
    "Description of Capital Stock" for additional
    information regarding the terms of our certificate of
    incorporation and bylaws as will be in effect upon the closing
    of this offering.
The reorganization will consist of a merger pursuant to which
    the outstanding membership interests in Oasis Petroleum LLC will
    be converted into membership interests in OAS Holdco. As a
    result of the merger, Oasis Petroleum LLC will become a wholly
    owned subsidiary of OAS Holdco. OAS Holdco will then contribute
    all of the membership interests in Oasis Petroleum LLC to Oasis
    Petroleum Inc. in exchange
    for           shares
    of common stock in Oasis Petroleum Inc. In connection with our
    corporate reorganization, an estimated net deferred tax
    liability of approximately $8.0 million will be established
    for differences between the book and tax basis of our assets and
    liabilities and a corresponding expense will be recorded to net
    income from continuing operations.
Contemporaneously with Oasis Petroleum LLC becoming a wholly
    owned subsidiary of Oasis Petroleum Inc., the limited liability
    company agreement of Oasis Petroleum LLC will be amended and
    restated to terminate certain rights and obligations of its
    members.
We refer to (i) the reorganization pursuant to which the
    outstanding membership interests of Oasis Petroleum LLC will be
    converted into membership interests of OAS Holdco, (ii) the
    acquisition by Oasis Petroleum Inc. of all of the membership
    interests of Oasis Petroleum LLC in exchange for shares of Oasis
    Petroleum Inc.'s common stock, (iii) the effectiveness
    of the limited liability company agreement of OAS Holdco and
    (iv) the consummation of the other related transactions
    collectively as our "corporate reorganization."
LLC
    Agreement of OAS Holdco
Members of Oasis Petroleum LLC have entered into a limited
    liability company agreement, or LLC agreement, for OAS Holdco
    that will become effective upon the consummation of our
    corporate reorganization and this offering. The LLC agreement
    provides that promptly following the consummation of the
    corporate reorganization and the completion of this offering,
    OAS Holdco make the following distributions (based on an assumed
    initial public offering price of
    $          
    per share):
•
a distribution to Oasis Petroleum Management LLC
    consisting of:
•
shares
    of our common stock, which represents 5% of the outstanding
    shares of our common stock held by OAS Holdco immediately prior
    to this offering less the number of shares sold by OAS Holdco in
    this offering; and
•
$      million, which represents
    5% of the net proceeds of this offering received by OAS Holdco
    as the selling stockholder;
•
a distribution to certain private investors and Oasis Petroleum
    Management LLC consisting of an aggregate of:
•
shares
    of our common stock, which represents such investors'
    proportionate interest (based on prior capital contributions
    other than capital contributions of Oasis Petroleum Management
    LLC) in the outstanding shares of our common stock held by OAS
    Holdco immediately prior to this offering less the number of
    shares sold by OAS Holdco in this offering; and
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•
$      million, which represents
    such investors' proportionate interest (based on capital
    contributions other than capital contributions of Oasis
    Petroleum Management LLC) in the net proceeds of this offering
    received by OAS Holdco as the selling stockholder; and
•
a distribution to all other members, including funds managed by
    EnCap, consisting of an aggregate of
    $      million, which represents
    the remaining net proceeds of this offering received by OAS
    Holdco as the selling stockholder.
Contemporaneously with the completion of the distributions to
    certain private investors described above, such private
    investors shall automatically cease to be members in OAS Holdco.
    In lieu of receiving cash distributions of the net proceeds of
    this offering received by OAS Holdco as the selling stockholder
    or the net proceeds of any future offering of our common stock
    by OAS Holdco, Oasis Petroleum Management LLC may elect to
    receive an equivalent distribution of shares of our common stock
    held by OAS Holdco based on the price per share received in such
    sale.
In addition to the distributions described above, the LLC
    agreement provides that OAS Holdco will make distributions of
    the proceeds to its members of any future sales of our common
    stock by OAS Holdco based on the price per share received in
    such sale. The LLC Agreement also provides that OAS Holdco will
    make distributions to its members upon a sale of Oasis Petroleum
    Inc. based on the valuation in connection with such transaction.
    Unless otherwise determined by the board of managers of OAS
    Holdco, on the third anniversary of the expiration of the
    lock-up agreement between OAS Holdco and the underwriters
    entered into in connection with this offering, OAS Holdco LLC
    will automatically dissolve and distribute all remaining shares
    of our common stock to its members based on a valuation at such
    time. The number of shares received by Oasis Petroleum
    Management LLC will increase as the rate of return ultimately
    realized by the other members of OAS Holdco increases. For
    example, assuming a distribution of all of our remaining shares
    of common stock by OAS Holdco promptly after this offering at a
    valuation equal to the initial public offering price of
    $         per share, Oasis Petroleum Management LLC would be
    entitled to receive    % of the number of shares distributed by
    OAS Holdco, or     % of our total
    shares outstanding. For illustrative purposes and assuming a
    distribution of all of our remaining shares of common stock by
    OAS Holdco promptly after this offering at a hypothetical
    valuation of $      per share,
    Oasis Petroleum Management LLC would be entitled to receive    %
    of the number of shares distributed by OAS Holdco,
    or     % of our total shares
    outstanding.
Oasis
    Petroleum Management LLC
Oasis Petroleum Management LLC was formed contemporaneously with
    Oasis Petroleum LLC to hold membership interests in Oasis
    Petroleum LLC on behalf of certain of our executive officers and
    other employees. Following the completion of the transactions
    described above, Oasis Petroleum Management LLC will own both a
    direct interest in our common stock and an indirect interest in
    OAS Holdco.
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PRINCIPAL
    AND SELLING STOCKHOLDERS
The following table sets forth information with respect to the
    beneficial ownership of our common stock as of March 1,
    2010 after giving effect to our corporate reorganization by:
•
each of our named executive officers;
•
each of our directors;
•
all of our directors and named executive officers as a group;
•
the selling stockholder; and
•
each stockholder known by us to be the beneficial owner of more
    than 5% of our outstanding shares of common stock.
Except as otherwise indicated, the person or entities listed
    below have sole voting and investment power with respect to all
    shares of our common stock beneficially owned by them, except to
    the extent this power may be shared with a spouse. All
    information with respect to beneficial ownership has been
    furnished by the respective directors, officers or 5% or more
    stockholders, as the case may be. The address for OAS Holding
    Company LLC and Oasis Petroleum Management LLC is 1001 Fannin
    Street, Suite 202, Houston, TX 77002.
Shares Beneficially Owned
Shares Beneficially Owned
Name and Address of
Prior to the Offering
Shares Being
After Offering
Beneficial Owner
Number
Percentage
Offered
Number
Percentage
Selling Stockholder and 5% Stockholder:
OAS Holding Company LLC
5% Stockholder:
Oasis Petroleum Management LLC
Directors and Named Executive Officers:
Thomas B. Nusz
Taylor L. Reid
Roy W. Mace
Kent O. Beers
Walter S. Smithwick
Douglas E. Swanson, Jr.
Robert L. Zorich
All directors and named executive officers as a group
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DESCRIPTION
    OF CAPITAL STOCK
Upon completion of this offering, the authorized capital stock
    of Oasis Petroleum Inc. will consist
    of           shares
    of common stock, $0.001 par value per share, of
    which           shares
    will be issued and outstanding,
    and           shares
    of preferred stock, $0.001 par value per share, of which no
    shares will be issued and outstanding.
We will adopt an amended and restated certificate of
    incorporation and amended and restated bylaws concurrently with
    the completion of this offering. The following summary of the
    capital stock and certificate of incorporation and bylaws of
    Oasis Petroleum Inc. does not purport to be complete and is
    qualified in its entirety by reference to the provisions of
    applicable law and to our amended and restated certificate of
    incorporation and amended and restated bylaws, which are filed
    as exhibits to the registration statement of which this
    prospectus is a part.
Common
    Stock
Holders of common stock are entitled to one vote for each share
    held of record on all matters submitted to a vote of the
    stockholders, and do not have cumulative voting rights. Subject
    to preferences that may be applicable to any outstanding shares
    of preferred stock, holders of common stock are entitled to
    receive ratably such dividends, if any, as may be declared from
    time to time by our board of directors out of funds legally
    available for dividend payments. All outstanding shares of
    common stock are fully paid and non-assessable, and the shares
    of common stock to be issued upon completion of this offering
    will be fully paid and non-assessable. The holders of common
    stock have no preferences or rights of conversion, exchange,
    pre-emption or other subscription rights. There are no
    redemption or sinking fund provisions applicable to the common
    stock. In the event of any liquidation, dissolution or
winding-up
of our affairs, holders of common stock will be entitled to
    share ratably in our assets that are remaining after payment or
    provision for payment of all of our debts and obligations and
    after liquidation payments to holders of outstanding shares of
    preferred stock, if any.
Preferred
    Stock
Our certificate of incorporation authorizes our board of
    directors, subject to any limitations prescribed by law, without
    further stockholder approval, to establish and to issue from
    time to time one or more classes or series of preferred stock,
    par value $0.001 per share, covering up to an aggregate
    of           shares
    of preferred stock. Each class or series of preferred stock will
    cover the number of shares and will have preferences, voting
    powers, qualifications and special or relative rights or
    privileges determined by the board of directors, which may
    include, among others, dividend rights, liquidation preferences,
    voting rights, conversion rights, preemptive rights and
    redemption rights.
Anti-Takeover
    Effects of Provisions of Our Certificate of Incorporation, our
    Bylaws and Delaware Law
Some provisions of Delaware law, and our certificate of
    incorporation and our bylaws described below, will contain
    provisions that could make the following transactions more
    difficult: acquisitions of us by means of a tender offer, a
    proxy contest or otherwise; or removal of our incumbent officers
    and directors. These provisions may also have the effect of
    preventing changes in our management. It is possible that these
    provisions could make it more difficult to accomplish or could
    deter transactions that stockholders may otherwise consider to
    be in their best interest or in our best interests, including
    transactions that might result in a premium over the market
    price for our shares.
These provisions, summarized below, are expected to discourage
    coercive takeover practices and inadequate takeover bids. These
    provisions are also designed to encourage persons seeking to
    acquire control of us to first negotiate with us. We believe
    that the benefits of increased protection and our potential
    ability to negotiate with the proponent of an unfriendly or
    unsolicited proposal to acquire or restructure us outweigh the
    disadvantages of discouraging these proposals because, among
    other things, negotiation of these proposals could result in an
    improvement of their terms.
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Delaware
    Law
We will be subject to the provisions of Section 203 of the
    Delaware General Corporation Law, or DGCL, regulating corporate
    takeovers. In general, those provisions prohibit a Delaware
    corporation, including those whose securities are listed for
    trading on the NYSE, from engaging in any business combination
    with any interested stockholder for a period of three years
    following the date that the stockholder became an interested
    stockholder, unless:
•
the transaction is approved by the board of directors before the
    date the interested stockholder attained that status;
•
upon consummation of the transaction that resulted in the
    stockholder becoming an interested stockholder, the interested
    stockholder owned at least 85% of the voting stock of the
    corporation outstanding at the time the transaction
    commenced; or
•
on or after such time the business combination is approved by
    the board of directors and authorized at a meeting of
    stockholders by at least two-thirds of the outstanding voting
    stock that is not owned by the interested stockholder.
Section 203 defines "business combination" to
    include the following:
•
any merger or consolidation involving the corporation and the
    interested stockholder;
•
any sale, transfer, pledge or other disposition of 10% or more
    of the assets of the corporation involving the interested
    stockholder;
•
subject to certain exceptions, any transaction that results in
    the issuance or transfer by the corporation of any stock of the
    corporation to the interested stockholder;
•
any transaction involving the corporation that has the effect of
    increasing the proportionate share of the stock of any class or
    series of the corporation beneficially owned by the interested
    stockholder; or
•
the receipt by the interested stockholder of the benefit of any
    loans, advances, guarantees, pledges or other financial benefits
    provided by or through the corporation.
In general, Section 203 defines an interested stockholder
    as any entity or person beneficially owning 15% or more of the
    outstanding voting stock of the corporation and any entity or
    person affiliated with or controlling or controlled by any of
    these entities or persons.
A Delaware corporation may "opt out" of
    Section 203 with an express provision in its original
    certificate of incorporation or an express provision in its
    certificate of incorporation or bylaws resulting from amendments
    approved by the holders of at least a majority of the
    corporation's outstanding voting shares. We do not intend
    to "opt out" of the provisions of Section 203.
    The statute could prohibit or delay mergers or other takeover or
    change in control attempts and, accordingly, may discourage
    attempts to acquire us.
Certificate
    of Incorporation and Bylaws
Among other things, upon the completion of this offering, our
    certificate of incorporation and bylaws will:
•
establish advance notice procedures with regard to stockholder
    proposals relating to the nomination of candidates for election
    as directors or new business to be brought before meetings of
    our stockholders. These procedures provide that notice of
    stockholder proposals must be timely given in writing to our
    corporate secretary prior to the meeting at which the action is
    to be taken. Generally, to be timely, notice must be received at
    our principal executive offices not less than 90 days nor
    more than 120 days prior to the first anniversary date of
    the annual meeting for the preceding year. Our bylaws specify
    the requirements as to form and content of all
    stockholders' notices. These requirements may preclude
    stockholders from bringing matters before the stockholders at an
    annual or special meeting;
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•
provide our board of directors the ability to authorize
    undesignated preferred stock. This ability makes it possible for
    our board of directors to issue, without stockholder approval,
    preferred stock with voting or other rights or preferences that
    could impede the success of any attempt to change control of us.
    These and other provisions may have the effect of deferring
    hostile takeovers or delaying changes in control or management
    of our company;
•
provide that the authorized number of directors may be changed
    only by resolution of the board of directors;
•
provide that all vacancies, including newly created
    directorships, may, except as otherwise required by law, be
    filled by the affirmative vote of a majority of directors then
    in office, even if less than a quorum;
•
at any time after OAS Holdco and its affiliates no longer own
    more than 50% of the outstanding shares of our common stock,
•
provide that any action required or permitted to be taken by the
    stockholders must be effected at a duly called annual or special
    meeting of stockholders and may not be effected by any consent
    in writing in lieu of a meeting of such stockholders, subject to
    the rights of the holders of any series of preferred stock
    (prior to such time, provide that such actions may be taken
    without a meeting by written consent);
•
provide that directors may be removed only for cause and only by
    the affirmative vote of holders of 80% of the voting power of
    our then outstanding common stock (prior to such time, provide
    that directors may be removed only for cause and only by the
    affirmative vote of the holders of a majority of our then
    outstanding common stock);
•
provide our certificate of incorporation and bylaws may be
    amended by the affirmative vote of the holders of at least
    two-thirds of our then outstanding common stock (prior to such
    time, provide that our certificate of incorporation and bylaws
    may be amended by the affirmative vote of the holders of a
    majority of our then outstanding common stock);
•
provide that special meetings of our stockholders may only be
    called by the board of directors, the chief executive officer or
    the chairman of the board (prior to such time provide that a
    special meeting may also be called by stockholders holding a
    majority of the outstanding shares entitled to vote);
•
provide for our board of directors to be divided into three
    classes of directors, with each class as nearly equal in number
    as possible, serving staggered three year terms, other than
    directors which may be elected by holders of preferred stock, if
    any. For more information on the classified board of directors,
    see "Management." This system of electing and removing
    directors may tend to discourage a third party from making a
    tender offer or otherwise attempting to obtain control of us,
    because it generally makes it more difficult for stockholders to
    replace a majority of the directors;
•
provide that we renounce any interest in the business
    opportunities of EnCap Investments, L.P. or any private fund
    that it manages or advises or any of its officers, directors,
    agents, stockholders, members, partners, affiliates and
    subsidiaries (other than Oasis directors that are presented
    business opportunities in their capacity as an Oasis director)
    and that they have no obligation to offer us those
    opportunities; and
•
provide that our bylaws can be amended or repealed at any
    regular or special meeting of stockholders or by the board of
    directors.
Limitation
    of Liability and Indemnification Matters
Our certificate of incorporation limits the liability of our
    directors for monetary damages for breach of their fiduciary
    duty as directors, except for liability that cannot be
    eliminated under the DGCL. Delaware law
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provides that directors of a company will not be personally
    liable for monetary damages for breach of their fiduciary duty
    as directors, except for liabilities:
•
for any breach of their duty of loyalty to us or our
    stockholders;
•
for acts or omissions not in good faith or which involve
    intentional misconduct or a knowing violation of law;
•
for unlawful payment of dividend or unlawful stock repurchase or
    redemption, as provided under Section 174 of the
    DGCL; or
•
for any transaction from which the director derived an improper
    personal benefit.
Any amendment, repeal or modification of these provisions will
    be prospective only and would not affect any limitation on
    liability of a director for acts or omissions that occurred
    prior to any such amendment, repeal or modification.
Our certificate of incorporation and bylaws also provide that we
    will indemnify our directors and officers to the fullest extent
    permitted by Delaware law. Our certificate of incorporation and
    bylaws also permit us to purchase insurance on behalf of any
    officer, director, employee or other agent for any liability
    arising out of that person's actions as our officer,
    director, employee or agent, regardless of whether Delaware law
    would permit indemnification. We intend to enter into
    indemnification agreements with each of our current and future
    directors and officers. These agreements will require us to
    indemnify these individuals to the fullest extent permitted
    under Delaware law against liability that may arise by reason of
    their service to us, and to advance expenses incurred as a
    result of any proceeding against them as to which they could be
    indemnified. We believe that the limitation of liability
    provision in our certificate of incorporation and the
    indemnification agreements will facilitate our ability to
    continue to attract and retain qualified individuals to serve as
    directors and officers.
Transfer
    Agent and Registrar
The transfer agent and registrar for our common stock
    is          .
Listing
We expect to list our common stock for quotation on the NYSE
    under the symbol "OAS."
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SHARES ELIGIBLE
    FOR FUTURE SALE
Prior to this offering, there has been no public market for our
    common stock. Future sales of our common stock in the public
    market, or the availability of such shares for sale in the
    public market, could adversely affect market prices prevailing
    from time to time. As described below, only a limited number of
    shares will be available for sale shortly after this offering
    due to contractual and legal restrictions on resale.
    Nevertheless, sales of a substantial number of shares of our
    common stock in the public market after such restrictions lapse,
    or the perception that those sales may occur, could adversely
    affect the prevailing market price at such time and our ability
    to raise equity-related capital at a time and price we deem
    appropriate.
Sales of
    Restricted Shares
Upon the closing of this offering, we will have outstanding an
    aggregate
    of           shares
    of common stock. Of these shares, all of
    the           shares
    of common stock to be sold in this offering will be freely
    tradable without restriction or further registration under the
    Securities Act, unless the shares are held by any of our
    "affiliates" as such term is defined in Rule 144
    of the Securities Act. All remaining shares of common stock held
    by existing stockholders will be deemed "restricted
    securities" as such term is defined under Rule 144.
    The restricted securities were issued and sold by us in private
    transactions and are eligible for public sale only if registered
    under the Securities Act or if they qualify for an exemption
    from registration under Rule 144 or Rule 701 under the
    Securities Act, which rules are summarized below.
As a result of the
lock-up
agreements described below and the provisions of Rule 144
    and Rule 701 under the Securities Act, the shares of our
    common stock (excluding the shares to be sold in this offering)
    that will be available for sale in the public market are as
    follows:
•
no shares will be eligible for sale on the date of this
    prospectus or prior to 180 days after the date of this
    prospectus;
•
shares will be eligible for sale upon the expiration of the
lock-up
agreements, beginning 180 days after the date of this
    prospectus (subject to extension) and when permitted under
    Rule 144 or Rule 701; and
•
shares will be eligible for sale, upon exercise of vested
    options, upon the expiration of the
lock-up
agreements, beginning 180 days after the date of this
    prospectus (subject to extension).
Lock-up
Agreements
We, all of our directors and officers, certain of our principal
    stockholders and the selling stockholder have agreed not to sell
    or otherwise transfer or dispose of any common stock for a
    period of 180 days from the date of this prospectus,
    subject to certain exceptions and extensions. See
    "Underwriters" for a description of these
lock-up
provisions.
Rule 144
In general, under Rule 144 as currently in effect, a person
    (or persons whose shares are aggregated) who is not deemed to
    have been an affiliate of ours at any time during the three
    months preceding a sale, and who has beneficially owned
    restricted securities within the meaning of Rule 144 for a
    least six months (including any period of consecutive ownership
    of preceding non-affiliated holders) would be entitled to sell
    those shares, subject only to the availability of current public
    information about us. A non-affiliated person who has
    beneficially owned restricted securities within the meaning of
    Rule 144 for at least one year would be entitled to sell
    those shares without regard to the provisions of Rule 144.
A person (or persons whose shares are aggregated) who is deemed
    to be an affiliate of ours and who has beneficially owned
    restricted securities within the meaning of Rule 144 for at
    least six months would be entitled to sell within any
    three-month period a number of shares that does not exceed the
    greater of one percent of the then outstanding shares of our
    common stock or the average weekly trading volume of our common
    stock reported through the New York Stock Exchange during the
    four calendar weeks preceding the
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filing of notice of the sale. Such sales are also subject to
    certain manner of sale provisions, notice requirements and the
    availability of current public information about us.
Rule 701
Employees, directors, officers, consultants or advisors who
    purchases shares from us in connection with a compensatory stock
    or option plan or other written compensatory agreement in
    accordance with Rule 701 before the effective date of the
    registration statement are entitled to sell such shares
    90 days after the effective date of the registration
    statement in reliance on Rule 144 without having to comply
    with the holding period requirement of Rule 144 and, in the
    case of non-affiliates, without having to comply with the public
    information, volume limitation or notice filing provisions of
    Rule 144. The SEC has indicated that Rule 701 will
    apply to typical stock options granted by an issuer before it
    becomes subject to the reporting requirements of the Exchange
    Act, along with the shares acquired upon exercise of such
    options, including exercises after the date of this prospectus.
Stock
    Issue Under Employee Plans
We intend to file a registration statement on
Form S-8
under the Securities Act to register stock issuable under our
    Long-Term Incentive Plan. This registration statement is
    expected to be filed following the effective date of the
    registration statement of which this prospectus is a part and
    will be effective upon filing. Accordingly, shares registered
    under such registration statement will be available for sale in
    the open market following the effective date, unless such shares
    are subject to vesting restrictions with us, Rule 144
    restrictions applicable to our affiliates or the
lock-up
restrictions described above.
Registration
    Rights
Prior to the consummation of this offering, we expect to enter
    into a registration rights agreement with the selling
    stockholder, which will require us to file and effect the
    registration of its shares in certain circumstances no earlier
    than 180 days after the date of this prospectus.
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MATERIAL
    U.S. FEDERAL INCOME AND ESTATE TAX
CONSIDERATIONS TO
NON-U.S.
HOLDERS
The following is a general discussion of the material
    U.S. federal income and estate tax consequences of the
    acquisition, ownership and disposition of our common stock to a
non-U.S. holder.
Except as specifically provided below (see
    "— Estate Tax"), for the purpose of this
    discussion, a
non-U.S. holder
is any beneficial owner of our common stock that is not for
    U.S. federal income tax purposes any of the following:
•
an individual citizen or resident of the U.S.;
•
a corporation (or other entity treated as a corporation for
    U.S. federal income tax purposes) created or organized in
    the U.S. or under the laws of the U.S. or any state or
    the District of Columbia;
•
a partnership (or other entity treated as a partnership or other
    pass-through entity for U.S. federal income tax purposes);
•
an estate whose income is subject to U.S. federal income
    tax regardless of its source; or
•
a trust (x) whose administration is subject to the primary
    supervision of a U.S. court and which has one or more
    U.S. persons who have the authority to control all
    substantial decisions of the trust or (y) which has made a
    valid election to be treated as a U.S. person.
If a partnership (or an entity treated as a partnership for
    U.S. federal income tax purposes) holds our common stock,
    the tax treatment of a partner in the partnership will generally
    depend on the status of the partner and upon the activities of
    the partnership. Accordingly, we urge partnerships that hold our
    common stock and partners in such partnerships to consult their
    tax advisors.
This discussion assumes that a
non-U.S. holder
will hold our common stock issued pursuant to the offering as a
    capital asset (generally, property held for investment). This
    discussion does not address all aspects of U.S. federal
    income taxation or any aspects of state, local or
non-U.S. taxation,
nor does it consider any U.S. federal income tax
    considerations that may be relevant to
non-U.S. holders
that may be subject to special treatment under U.S. federal
    income tax laws, including, without limitation,
    U.S. expatriates, life insurance companies, tax-exempt or
    governmental organizations, dealers in securities or currency,
    banks or other financial institutions, investors whose
    functional currency is other than the U.S. dollar, and
    investors that hold our common stock as part of a hedge,
    straddle or conversion transaction. Furthermore, the following
    discussion is based on current provisions of the Internal
    Revenue Code of 1986, as amended, and Treasury Regulations and
    administrative and judicial interpretations thereof, all as in
    effect on the date hereof, and all of which are subject to
    change, possibly with retroactive effect.
We urge each prospective investor to consult a tax advisor
    regarding the U.S. federal, state, local and
non-U.S. income
and other tax consequences of acquiring, holding and disposing
    of shares of our common stock.
Dividends
We have not paid any dividends on our common stock, and we do
    not plan to pay any dividends for the foreseeable future.
    However, if we do pay dividends on our common stock, those
    payments will constitute dividends for U.S. tax purposes to
    the extent paid from our current or accumulated earnings and
    profits, as determined under U.S. federal income tax
    principles. To the extent those dividends exceed our current and
    accumulated earnings and profits, the dividends will constitute
    a return of capital and will first reduce a holder's
    adjusted tax basis in the common stock, but not below zero, and
    then will be treated as gain from the sale of the common stock
    (see "— Gain on Disposition of Common Stock).
Any dividend (out of earnings and profits) paid to a
non-U.S. holder
of our common stock generally will be subject to
    U.S. withholding tax either at a rate of 30% of the gross
    amount of the dividend or such lower rate as may be specified by
    an applicable tax treaty. To receive the benefit of a reduced
    treaty rate, a
non-U.S. holder
must provide us with an IRS
Form W-8BEN
or other appropriate version of IRS
Form W-8
certifying qualification for the reduced rate.
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Dividends received by a
non-U.S. holder
that are effectively connected with a U.S. trade or
    business conducted by the
non-U.S. holder
are exempt from such withholding tax. To obtain this exemption,
    the
non-U.S. holder
must provide us with an IRS
Form W-8ECI
properly certifying such exemption. Such effectively connected
    dividends, although not subject to withholding tax, will be
    subject to U.S. federal income tax on a net income basis at
    the same graduated rates generally applicable to
    U.S. persons, net of certain deductions and credits,
    subject to any applicable tax treaty providing otherwise. In
    addition to the income tax described above, dividends received
    by corporate
non-U.S. holders
that are effectively connected with a U.S. trade or
    business of the corporate
non-U.S. holder
may be subject to a branch profits tax at a rate of 30% or such
    lower rate as may be specified by an applicable tax treaty.
A
non-U.S. holder
of our common stock may obtain a refund of any excess amounts
    withheld if the
non-U.S. holder
is eligible for a reduced rate of United States withholding tax
    and an appropriate claim for refund is timely filed with the
    Internal Revenue Service or the IRS.
Gain on
    Disposition of Common Stock
A
non-U.S. holder
generally will not be subject to U.S. federal income tax on
    any gain realized upon the sale or other disposition of our
    common stock unless:
•
the gain is effectively connected with a U.S. trade or
    business of the
non-U.S. holder
and, if required by an applicable tax treaty, is attributable to
    a U.S. permanent establishment maintained by such
non-U.S. holder;
•
the
non-U.S. holder
is an individual who is present in the United States for a
    period or periods aggregating 183 days or more during the
    calendar year in which the sale or disposition occurs and
    certain other conditions are met; or
•
we are or have been a "U.S. real property holding
    corporation" for U.S. federal income tax purposes and
    the
non-U.S. holder
holds or has held, directly or indirectly, at any time within
    the shorter of the five-year period preceding the disposition or
    the
non-U.S. holder's
holding period, more than 5% of our common stock. Generally, a
    corporation is a United States real property holding corporation
    if the fair market value of its United States real property
    interests equals or exceeds 50% of the sum of the fair market
    value of its worldwide real property interests and its other
    assets used or held for use in a trade or business. We believe
    that we are, and will remain for the foreseeable future, a
    "U.S. real property holding corporation" for
    U.S. federal income tax purposes.
Unless an applicable tax treaty provides otherwise, gain
    described in the first bullet point above will be subject to
    U.S. federal income tax on net income basis at the same
    graduated rates generally applicable to U.S. persons.
    Corporate
non-U.S. holders
also may be subject to a branch profits tax equal to 30% (or
    such lower rate as may be specified by an applicable tax treaty)
    of its earnings and profits that are effectively connected with
    a U.S. trade or business.
Gain described in the second bullet point above (which may be
    offset by U.S. source capital losses, provided that the
non-U.S. holder
has timely filed U.S. federal income tax returns with
    respect to such losses) will be subject to a flat 30%
    U.S. federal income tax (or such lower rate as may be
    specified by an applicable tax treaty).
Non-U.S. holders
should consult any applicable income tax treaties that may
    provide for different rules.
Backup
    Withholding and Information Reporting
Generally, we must report annually to the IRS the amount of
    dividends paid to each
non-U.S. holder,
the name and address of the recipient, and the amount, if any,
    of tax withheld with respect to those dividends. A similar
    report is sent to each
non-U.S. holder.
These information reporting requirements apply even if
    withholding was not required. Pursuant to tax treaties or other
    agreements, the IRS may make its reports available to tax
    authorities in the recipient's country of residence.
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Payments of dividends to a
non-U.S. holder
may be subject to backup withholding (at the applicable rate)
    unless the
non-U.S. holder
establishes an exemption, for example, by properly certifying
    its
non-U.S. status
on an IRS
Form W-8BEN
or another appropriate version of IRS
Form W-8.
Notwithstanding the foregoing, backup withholding may apply if
    either we or our paying agent has actual knowledge, or reason to
    know, that the beneficial owner is a U.S. person that is
    not an exempt recipient.
Payments of the proceeds from sale or other disposition by a
non-U.S. holder
of our common stock effected outside the U.S. by or through
    a foreign office of a broker generally will not be subject to
    information reporting or backup withholding. However,
    information reporting (but not backup withholding) will apply to
    those payments if the broker does not have documentary evidence
    that the holder is a
non-U.S. holder,
an exemption is not otherwise established, and the broker has
    certain relationships with the United States.
Payments of the proceeds from a sale or other disposition by a
non-U.S. holder
of our common stock effected by or through a U.S. office of
    a broker generally will be subject to information reporting and
    backup withholding (at the applicable rate) unless the
non-U.S. holder
establishes an exemption, for example, by properly certifying
    its
non-U.S. status
on an IRS
Form W-8BEN
or another appropriate version of IRS
Form W-8.
Notwithstanding the foregoing, information reporting and backup
    withholding may apply if the broker has actual knowledge, or
    reason to know, that the holder is a U.S. person that is
    not an exempt recipient.
Backup withholding is not an additional tax. Rather, the
    U.S. income tax liability of persons subject to backup
    withholding will be reduced by the amount of tax withheld. If
    withholding results in an overpayment of taxes, a refund may be
    obtained, provided that the required information is timely
    furnished to the IRS.
Estate
    Tax
Our common stock owned or treated as owned by an individual who
    is not a citizen or resident of the U.S. (as specifically
    defined for U.S. federal estate tax purposes) at the time
    of death will be includible in the individual's gross
    estate for U.S. federal estate tax purposes and may be
    subject to U.S. federal estate tax unless an applicable
    estate tax treaty provides otherwise.
Fiscal
    Year 2011 Revenue Proposals
President Obama's Administration has recently released
    revenue proposals in "General Explanations of the
    Administration's Fiscal 2011 Revenue Proposals" that
    would limit the ability of
non-U.S. holders
to claim relief from U.S. withholding tax in respect of
    dividends paid on our common stock, if such holders hold our
    common stock through a
non-U.S. financial
institution that is not a "qualified intermediary."
    The Administration's proposals also would limit the ability
    of certain
non-U.S. entities
that are
non-U.S. holders
to claim relief from U.S. withholding tax in respect of
    dividends paid by us to such
non-U.S. holders
unless those entities certify that no U.S. person owns,
    directly or indirectly, an interest of more than ten percent or
    provide the name, address, and tax identification number of each
    substantial U.S. owner to the withholding agent. A
non-U.S. holder
generally would be permitted to claim a refund to the extent any
    tax withheld exceeded the holder's actual tax liability. It
    is unclear whether, or in what form, these proposals may be
    enacted.
Non-U.S. holders
are encouraged to consult with their tax advisers regarding the
    possible implications of the Administration's proposals on
    their investment in respect of the common stock.
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UNDERWRITERS
Under the terms and subject to the conditions contained in an
    underwriting agreement dated the date of this prospectus, the
    underwriters named below, for whom Morgan Stanley &
    Co. Incorporated and UBS Securities LLC are acting as
    representatives, have severally agreed to purchase, and we and
    the selling stockholder have agreed to sell to them, severally,
    the number of shares indicated below:
Name
Number of Shares
Morgan Stanley & Co. Incorporated
UBS Securities LLC
Simmons & Company International
Total
The underwriters and the representatives are collectively
    referred to as the "underwriters" and the
    "representatives," respectively. The underwriters are
    offering the shares of common stock subject to their acceptance
    of the shares from us and the selling stockholder and subject to
    prior sale. The underwriting agreement provides that the
    obligations of the several underwriters to pay for and accept
    delivery of the shares of common stock offered by this
    prospectus are subject to the approval of certain legal matters
    by their counsel and to certain other conditions. The
    underwriters are obligated to take and pay for all of the shares
    of common stock offered by this prospectus if any such shares
    are taken. However, the underwriters are not required to take or
    pay for the shares covered by the underwriters'
    over-allotment option described below.
The per share price of any shares sold by the underwriters shall
    be the public offering price listed on the cover page of this
    prospectus, in United States dollars, less an amount not greater
    than the per share amount of the concession to dealers described
    below.
The underwriters initially propose to offer part of the shares
    of common stock directly to the public at the public offering
    price listed on the cover page of this prospectus and part to
    certain dealers at a price that represents a concession not in
    excess of $      a share under the
    public offering price. Any underwriter may allow, and such
    dealers may reallow, a concession not in excess of
    $      a share to other underwriters or
    to certain dealers. After the initial offering of the shares of
    common stock, the offering price and other selling terms may
    from time to time be varied by the representatives.
We and the selling stockholder have granted to the underwriters
    an option, exercisable for 30 days from the date of this
    prospectus, to purchase up to an aggregate
    of          
    additional shares of common stock at the public offering price
    listed on the cover page of this prospectus, less underwriting
    discounts and commissions. The underwriters may exercise this
    option solely for the purpose of covering over-allotments, if
    any, made in connection with the offering of the shares of
    common stock offered by this prospectus. To the extent the
    option is exercised, each underwriter will become obligated,
    subject to certain conditions, to purchase about the same
    percentage of the additional shares of common stock as the
    number listed next to the underwriter's name in the
    preceding table bears to the total number of shares of common
    stock listed next to the names of all underwriters in the
    preceding table. If the underwriters' option is exercised
    in full, the total price to the public would be
    $          ,
    the total underwriters' discounts and commissions would be
    $          ,
    the total proceeds to us would be
    $          ,
    and the total proceeds to the selling stockholder would be
    $          .
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The following table shows the per share and total underwriting
    discounts and commissions to be paid to the underwriters by us
    and by the selling stockholder. These amounts are shown assuming
    no exercise and full exercise of the underwriters' option
    to purchase additional shares.
Paid by Us
Paid by the Selling Stockholder
No Exercise
Full Exercise
No Exercise
Full Exercise
Per Share
$
$
$
$
Total
$
$
$
$
We estimate that the expenses of the offering, not including
    underwriting discounts and commissions, will be approximately
    $          ,
    all of which will be paid by us.
The underwriters have informed us that they do not intend sales
    to discretionary accounts to exceed 5% of the total number of
    shares of common stock offered by them.
We expect to list our common stock for quotation on the NYSE
    under the symbol "OAS."
We, all of our directors and officers, certain of our principal
    stockholders and the selling stockholder have agreed that,
    without the prior written consent of Morgan Stanley &
    Co. Incorporated and UBS Securities LLC and subject to certain
    exceptions, on behalf of the underwriters, we and they will not,
    during the period ending 180 days after the date of this
    prospectus:
•
offer, pledge, sell, contract to sell, sell any option or
    contract to purchase, purchase any option or contract to sell,
    grant any option, right or warrant to purchase, lend or
    otherwise transfer or dispose of, directly or indirectly, any
    shares of common stock or any securities convertible into or
    exercisable or exchangeable for common stock;
•
enter into any swap or other arrangement that transfers to
    another, in whole or in part, any of the economic consequences
    of ownership of the common stock; or
•
file any registration statement with the SEC relating to the
    offering of any shares of common stock or any securities
    convertible into or exercisable or exchangeable for common stock;
whether any such transaction described above is to be settled by
    delivery of common stock or such other securities, in cash or
    otherwise.
The restrictions described in the immediately preceding
    paragraph shall not apply to:
•
the sale of shares to the underwriters pursuant to the
    underwriting agreement;
•
the issuance by us of shares of common stock upon the exercise
    of an option or a warrant or the conversion of a security
    outstanding on the date of this prospectus of which the
    underwriters have been advised in writing;
•
transactions by any person other than us relating to shares of
    common stock or other securities acquired in open market
    transactions after the completion of the offering of the shares;
•
transfers by the selling stockholder of shares of common stock
    or any other security convertible into shares of our common
    stock as a bona fide gift or in connection with bona fide estate
    planning; or
•
distributions by the selling stockholder of shares of common
    stock or any other security convertible into shares of our
    common stock to limited partners, members or stockholders of
    such selling stockholder, subject to certain restrictions.
The
180-day
restricted period described in the preceding paragraph will be
    automatically extended if:
•
during the last 17 days of the
180-day
restricted period we issue an earnings release or material news
    or announce material event relating to us occurs; or
•
prior to the expiration of the
180-day
restricted period, we announce that we will release earnings
    results during the
16-day
period beginning on the last day of the
180-day
restricted period;
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in which case the restrictions described in the preceding
    paragraph will continue to apply until the expiration of the
18-day
period beginning on the issuance of the earnings release or the
    occurrence of the material news or material event.
In order to facilitate the offering of the common stock, the
    underwriters may engage in transactions that stabilize, maintain
    or otherwise affect the price of the common stock. Specifically,
    the underwriters may over-allot in connection with the offering,
    creating a short position in the common stock for their own
    account. In addition, to cover over-allotments or to stabilize
    the price of the common stock, the underwriters may bid for, and
    purchase, shares of common stock in the open market. Finally,
    the underwriting syndicate may reclaim selling concessions
    allowed to an underwriter or a dealer for distributing the
    common stock in the offering, if the syndicate repurchases
    previously distributed common stock in transactions to cover
    syndicate short positions, in stabilization transactions or
    otherwise. Any of these activities may stabilize or maintain the
    market price of the common stock above independent market
    levels. The underwriters are not required to engage in these
    activities, and may end any of these activities at any time.
We, the selling stockholder, certain of its affiliates and the
    underwriters have agreed to indemnify each other against certain
    liabilities, including liabilities under the Securities Act.
Directed
    Share Program Prospectus Disclosure
At our request, the underwriters have reserved for sale, at the
    initial offering price, up
    to           shares
    offered hereby for directors, officers, employees, consultants,
    business associates, and related persons associated with us. The
    sale of the reserved shares to these purchasers will be made by
    Morgan Stanley & Co. Incorporated. The number of
    shares of common stock available for sale to the general public
    will be reduced to the extent such persons purchase such
    reserved shares. Any reserved shares which are not so purchased
    will be offered by the underwriters to the general public on the
    same basis as the other shares offered by this prospectus. We
    have agreed to indemnify Morgan Stanley & Co.
    Incorporated in connection with the directed share program,
    including for the failure of any participant to pay for its
    shares.
Pricing
    of the Offering
Prior to this offering, there has been no public market for our
    common stock. The initial public offering price is determined by
    negotiations between us, the selling stockholder and the
    representatives. Among the factors to be considered in
    determining the initial public offering price will be the
    information set forth in this prospectus, our history and
    prospects, the history of and prospects for our industry in
    general, our sales, earnings and certain other financial and
    operating information in recent periods, and the price-earnings
    ratios, price-sales ratios, market prices of securities, certain
    financial and operating information of companies engaged in
    activities similar to ours and other factors deemed relevant by
    the underwriters, the selling stockholder and us. The estimated
    initial public offering price range set forth on the cover page
    of the preliminary prospectus is subject to change as a result
    of market conditions and other factors.
Relationships
    with Underwriters
From time to time in the ordinary course of business, certain of
    the underwriters and their respective affiliates have performed,
    and may in the future perform, various commercial banking,
    investment banking and other financial services for us for which
    they received, or will receive, customary fees and reimbursement
    of expenses. In particular, Simmons & Company
    International has provided, and may in the future provide
    financial advisory services for which services it has received,
    and may in the future receive, customary fees and reimbursement
    of expenses. In addition, an affiliate of UBS Securities LLC
    serves as a lender under our revolving credit facility and will
    therefore receive its respective share of any repayment by us of
    amounts outstanding under our revolving credit facility from the
    net proceeds of this offering. However, this affiliate will
    receive less than 5% of the total net proceeds (not including
    underwriting compensation) from this offering.
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LEGAL
    MATTERS
The validity of our common stock offered by this prospectus will
    be passed upon for Oasis Petroleum Inc., by Vinson &
    Elkins L.L.P., Houston, Texas. Certain legal matters in
    connection with this offering will be passed upon for the
    underwriters by Andrews Kurth LLP, Houston, Texas.
EXPERTS
The consolidated financial statements of Oasis Petroleum LLC as
    of December 31, 2009 and 2008 and for the period from
    February 26, 2007 (inception) to December 31, 2007 and
    for each of the two years ended December 31, 2009 included
    in this prospectus have been so included in reliance on the
    report of PricewaterhouseCoopers LLP, an independent registered
    public accounting firm, given on the authority of said firm as
    experts in auditing and accounting.
The balance sheet of Oasis Petroleum Inc. as of
    February 25, 2010 included in this prospectus has been so
    included in reliance on the report of PricewaterhouseCoopers
    LLP, an independent registered public accounting firm, given on
    the authority of said firm as experts in auditing and accounting.
The Statement of Revenues and Direct Operating Expenses of the
    Bill Barrett Corporation Acquisition Properties, the predecessor
    to Oasis Petroleum LLC, for the six month period ended
    June 30, 2007 and the Statement of Revenues and Direct
    Operating Expenses of the Kerogen Acquisition Properties for the
    year ended December 31, 2008 included in this prospectus
    have been so included in reliance on the reports of
    PricewaterhouseCoopers LLP, an independent registered public
    accounting firm, given on the authority of said firm as experts
    in auditing and accounting.
The information included in this prospectus regarding estimated
    quantities of proved reserves, the future net revenues from
    those reserves and their present value is based, in part, on
    estimates of the proved reserves and present values of proved
    reserves as of December 31, 2007, 2008 and 2009. The
    reserve estimates at December 31, 2007 and 2008 are based
    on reports prepared by W.D. Von Gonten & Co.,
    independent reserve engineers. The reserve estimates at
    December 31, 2009 are based on a report prepared by
    DeGolyer and MacNaughton, independent reserve engineers. These
    estimates are included in this prospectus in reliance upon the
    authority of such firms as experts in these matters.
WHERE YOU
    CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on
Form S-1
(including the exhibits, schedules and amendments thereto) under
    the Securities Act, with respect to the shares of our common
    stock offered hereby. This prospectus does not contain all of
    the information set forth in the registration statement and the
    exhibits and schedules thereto. For further information with
    respect to us and the common stock offered hereby, we refer you
    to the registration statement and the exhibits and schedules
    filed therewith. Statements contained in this prospectus as to
    the contents of any contract, agreement or any other document
    are summaries of the material terms of this contract, agreement
    or other document. With respect to each of these contracts,
    agreements or other documents filed as an exhibit to the
    registration statement, reference is made to the exhibits for a
    more complete description of the matter involved. A copy of the
    registration statement, and the exhibits and schedules thereto,
    may be inspected without charge at the public reference
    facilities maintained by the SEC at 100 F Street NE,
    Washington, D.C. 20549. Copies of these materials may be
    obtained, upon payment of a duplicating fee, from the Public
    Reference Section of the SEC at 100 F Street NE,
    Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330
for further information on the operation of the public reference
    facility. The SEC maintains a website that contains reports,
    proxy and information
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statements and other information regarding registrants that file
    electronically with the SEC. The address of the SEC's
    website is
http://www.sec.gov
.
After we have completed this offering, we will file annual,
    quarterly and current reports, proxy statements and other
    information with the SEC. We expect to have an operational
    website concurrently with the completion of this offering and we
    expect to make our periodic reports and other information filed
    with or furnished to the SEC available, free of charge, through
    our website, as soon as reasonably practicable after those
    reports and other information are electronically filed with or
    furnished to the SEC. Information on our website or any other
    website is not incorporated by reference into this prospectus
    and does not constitute a part of this prospectus. You may read
    and copy any reports, statements or other information on file at
    the public reference rooms. You can also request copies of these
    documents, for a copying fee, by writing to the SEC, or you can
    review these documents on the SEC's website, as described
    above. In addition, we will provide electronic or paper copies
    of our filings free of charge upon request.
121
Table of Contents
Index to
    Financial Statements
Page
Oasis Petroleum LLC
Report of Independent Registered Public
    Accounting Firm
F-2
Consolidated Balance Sheets at December 31,
    2009 and 2008
F-3
Consolidated Statements of Operations for the
    Years Ended December 31, 2009, 2008 and for the Period from
    February 26, 2007 (Inception) to December 31,
    2007
F-4
Consolidated Statements of Changes in
    Members' Equity for the Years Ended December 31, 2009,
    2008 and for the Period from February 26,
    2007 (Inception) to December 31, 2007
F-5
Consolidated Statements of Cash Flows for the
    Years Ended December 31, 2009, 2008 and for the Period from
    February 26, 2007 (Inception) to December 31,
    2007
F-6
Notes to Consolidated Financial Statements
F-7
Oasis Petroleum Inc.
Report of Independent Registered Public
    Accounting Firm
F-33
Balance Sheet at February 25, 2010
F-34
Notes to Balance Sheet
F-35
Bill Barrett Corporation Acquisition Properties (as
    Predecessor)
Report of Independent Registered Public
    Accounting Firm
F-36
Statement of Revenues and Direct Operating
    Expenses for the Six Months Ended June 30, 2007
F-37
Notes to Statement of Revenues and Direct
    Operating Expenses
F-38
Kerogen Acquisition Properties
Report of Independent Registered Public
    Accounting Firm
F-41
Statements of Revenues and Direct Operating
    Expenses for the Year Ended December 31, 2008 (audited) and
    for the Three Months Ended March 31, 2009 and 2008
    (unaudited)
F-42
Notes to Statements of Revenues and Direct
    Operating Expenses
F-43
Kerogen Acquisition Properties
Unaudited Pro Forma Financial Information
F-46
F-1
Table of Contents
Report of
    Independent Registered Public Accounting Firm
To the Board of Managers of Oasis Petroleum LLC:
In our opinion, the accompanying consolidated balance sheets and
    the related consolidated statements of operations, members'
    equity, and cash flows present fairly, in all material respects,
    the financial position of Oasis Petroleum LLC and its
    subsidiaries (the "Company") at December 31, 2009
    and 2008, and the results of their operations and their cash
    flows for the years ended December 31, 2009 and 2008, and
    for the period from February 26, 2007 (inception) to
    December 31, 2007, in conformity with accounting principles
    generally accepted in the United States of America. These
    financial statements are the responsibility of the
    Company's management. Our responsibility is to express an
    opinion on these financial statements based on our audits. We
    conducted our audits of these statements in accordance with the
    standards of the Public Company Accounting Oversight Board
    (United States). Those standards require that we plan and
    perform the audit to obtain reasonable assurance about whether
    the financial statements are free of material misstatement. An
    audit includes examining, on a test basis, evidence supporting
    the amounts and disclosures in the financial statements,
    assessing the accounting principles used and significant
    estimates made by management, and evaluating the overall
    financial statement presentation. We believe that our audits
    provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Houston, Texas
March 4, 2010
F-2
Table of Contents
Oasis
    Petroleum LLC
Consolidated Balance Sheet
December 31,
2009
2008
(In thousands)
ASSETS
Current assets
Cash and cash equivalents
$
40,562
$
1,570
Accounts receivable — oil and gas revenues
9,142
794
Accounts receivable — joint interest partners
1,250
4,219
Inventory
1,258
1,569
Prepaid expenses
134
94
Advances to joint interest partners
4,605
2,274
Derivative instruments
219
3,284
Total current assets
57,170
13,804
Property, plant and equipment
Oil and gas properties (successful efforts method)
243,350
159,821
Other properties
866
747
Less: accumulated depreciation, depletion, amortization and
    impairment
(62,643
)
(46,348
)
Total property, plant and equipment, net
181,573
114,220
Derivative instruments
—
806
Deferred costs and other assets
810
238
Total assets
$
239,553
$
129,068
LIABILITIES AND MEMBERS' EQUITY
Current liabilities
Accounts payable
$
1,577
$
2,573
Advances from joint interest partners
589
206
Production taxes and royalties payable
2,563
507
Accrued liabilities
18,038
12,716
Accrued interest payable
144
1
Derivative instruments
1,087
—
Total current liabilities
23,998
16,003
Long-term debt
35,000
26,000
Asset retirement obligations
6,511
4,458
Derivative instruments
2,085
—
Other liabilities
109
148
Total liabilities
67,703
46,609
Commitments and contingencies (see Note 10)
Members' equity
Capital contributions
235,000
130,400
Accumulated loss
(63,150
)
(47,941
)
Total members' equity
171,850
82,459
Total liabilities and members' equity
$
239,553
$
129,068
The accompanying notes are an integral part of these
    consolidated financial statements.
F-3
Table of Contents
Oasis
    Petroleum LLC
Consolidated Statement of Operations
Period from
February 26, 2007
December 31,
(Inception) through
2009
2008
December 31, 2007
(In thousands)
Oil and gas revenues
$
37,755
$
34,736
$
13,791
Expenses
Lease operating expenses
8,691
7,073
2,946
Production taxes
3,810
3,001
1,211
Depreciation, depletion and amortization
16,670
8,686
4,185
Exploration expenses
1,019
3,222
1,164
Rig termination
3,000
—
—
Impairment of oil and gas properties
6,233
47,117
1,177
Gain on sale of properties
(1,455
)
—
—
General and administrative expenses
9,342
5,452
3,181
Total expenses
47,310
74,551
13,864
Operating loss
(9,555
)
(39,815
)
(73
)
Other income (expense)
Change in unrealized gain (loss) on derivative instruments
(7,043
)
14,769
(10,679
)
Realized gain (loss) on derivative instruments
2,296
(6,932
)
(1,062
)
Interest expense
(912
)
(2,404
)
(1,776
)
Other income (expense)
5
(9
)
40
Total other income (expense)
(5,654
)
5,424
(13,477
)
Net loss
$
(15,209
)
$
(34,391
)
$
(13,550
)
The accompanying notes are an integral part of these
    consolidated financial statements.
F-4
Table of Contents
Oasis
    Petroleum LLC
Consolidated Statement of Members'
    Equity
(In thousands)
Members' Equity, February 26, 2007 (Inception)
$
—
Capital Contributions
49,900
Net Loss
(13,550
)
Members' Equity, December 31, 2007
36,350
Capital Contributions
80,500
Net Loss
(34,391
)
Members' Equity, December 31, 2008
82,459
Capital Contributions
104,600
Net Loss
(15,209
)
Members' Equity, December 31, 2009
$
171,850
The accompanying notes are an integral part of these
    consolidated financial statements.
F-5
Table of Contents
Oasis
    Petroleum LLC
Consolidated Statement of Cash Flows
Period from
February 26, 2007
December 31,
(Inception) through
2009
2008
December 31, 2007
(In thousands)
Cash Flows from Operating Activities:
Net loss
$
(15,209
)
$
(34,391
)
$
(13,550
)
Adjustments to reconcile net loss to net cash provided by
    operating activities:
Depreciation, depletion and amortization
16,670
8,686
4,185
Exploration expenses
—
1,280
—
Impairment of oil and gas properties
6,233
47,117
1,177
Gain on sale of properties
(1,455
)
—
—
Derivative instruments
4,747
(7,837
)
11,741
Debt discount amortization
95
107
61
Working capital and other changes:
Change in accounts receivable
(6,409
)
(988
)
(4,008
)
Change in inventory
(218
)
(1,191
)
(505
)
Change in prepaid expenses
(40
)
(6
)
(88
)
Change in other assets
(667
)
—
—
Change in accounts payable and accrued liabilities
2,440
968
3,235
Change in other liabilities
(39
)
21
36
Net cash provided by operating activities
6,148
13,766
2,284
Cash flows from investing activities:
Capital expenditures
(47,396
)
(70,427
)
(8,876
)
Acquisition of oil and gas properties
(35,215
)
—
(82,010
)
Derivative settlements
2,296
(6,932
)
(1,062
)
Advances to joint interest partners
(2,331
)
(1,430
)
(40
)
Advances from joint interest partners
383
206
—
Proceeds from equipment and property sales
1,507
105
—
Net cash used in investing activities
(80,756
)
(78,478
)
(91,988
)
Cash flows from financing activities:
Proceeds from members' contributions
104,600
80,500
49,900
Proceeds from issuance of debt
22,000
6,750
46,500
Reduction in debt
(13,000
)
(27,250
)
—
Debt issuance costs
—
—
(414
)
Net cash provided by financing activities
113,600
60,000
95,986
Increase (decrease) in cash and cash equivalents
38,992
(4,712
)
6,282
Cash and cash equivalents
Beginning of period
1,570
6,282
—
End of period
$
40,562
$
1,570
$
6,282
Supplemental cash flow Information:
Cash interest paid
$
674
$
2,485
$
1,526
Supplemental non-cash transactions:
Accrued capital expenditures
$
4,134
$
8,173
$
3,425
Asset retirement obligations
2,156
410
3,712
The accompanying notes are an integral part of these
    consolidated financial statements.
F-6
Table of Contents
Oasis
    Petroleum LLC
Notes
    to Consolidated Financial Statements
1.
Organization
    and Operations of the Company
Organization
Oasis Petroleum LLC ("Oasis" or "Company")
    was formed as a Delaware limited liability company on
    February 26, 2007 by certain members of the Company's
    senior management team, through Oasis Petroleum Management LLC
    as described below, and private equity funds managed by EnCap
    Investments LLC ("EnCap"). EnCap, which was formed in
    1988, provides private equity funding to independent oil and gas
    companies. As of December 31, 2009, EnCap was the majority
    holder and controlling member of the Company.
The Company entered into a limited liability company agreement
    dated March 5, 2007 (the "Oasis Agreement") that
    provided for a maximum $100 million of capital
    contributions from EnCap and other members during a commitment
    period that extended from March 5, 2007 until
    March 10, 2010, unless extended by mutual agreement of
    EnCap and the Company (the "Commitment Period"). The
    Oasis Agreement was amended on November 1, 2007 to increase
    the maximum amount of capital contribution commitment from its
    members to $200 million. On December 1, 2009, the
    Oasis Agreement was further amended to extend the Commitment
    Period to December 31, 2011 and to increase the maximum
    amount of capital contribution commitment from its members to
    $275 million. The Company had $40 million of remaining
    capital commitment capacity under the Oasis Agreement, as
    amended, as of December 31, 2009.
Oasis Petroleum Management LLC ("OPM"), a Delaware
    limited liability company, was formed in February 2007 to allow
    Company employees to become indirect investors in the Company.
    OPM does not charge the Company management fees since all OPM
    investors are Oasis employees who receive compensation directly
    from the Company for their employment services. In April 2008,
    the Company formed Oasis Petroleum International LLC
    ("OPI"), a Delaware limited liability company, to
    conduct business development activities outside of the United
    States of America. OPI currently has no assets or business
    activities.
Nature
    of Business
The Company is an independent exploration and production company
    focused on the acquisition and development of unconventional oil
    and natural gas resources primarily in the Williston Basin. All
    of the Company's assets, which consist of proved and
    unproved oil and natural gas properties located primarily in the
    Montana and North Dakota areas of the Williston Basin, are owned
    by Oasis Petroleum North America LLC ("OPNA"), a
    wholly owned subsidiary of the Company, which was formed on
    May 17, 2007 as a Delaware limited liability company.
2.
Summary
    of Significant Accounting Policies
Basis
    of Presentation
The accompanying consolidated financial statements of the
    Company include the accounts of Oasis and its wholly owned
    subsidiaries OPI and OPNA. These statements have been prepared
    in accordance with accounting principles generally accepted in
    the United States of America ("GAAP"). All significant
    intercompany transactions have been eliminated in consolidation.
Use of
    Estimates
Preparation of the Company's consolidated financial
    statements in accordance with GAAP requires management to make
    estimates and assumptions that affect the reported amounts of
    assets and liabilities at the date of the consolidated financial
    statements and the reported amounts of revenues and expenses
    during the reporting period. The most significant estimates
    pertain to proved oil and natural gas reserves and related cash
    flow estimates used in impairment tests of long-lived assets,
    estimates of future development, dismantlement
F-7
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
and abandonment costs, estimates relating to certain oil and
    natural gas revenues and expenses and estimates of expenses
    related to legal, environmental and other contingencies. Certain
    of these estimates require assumptions regarding future
    commodity prices, future costs and expenses and future
    production rates. Actual results could differ from those
    estimates.
As an oil and natural gas producer, the Company's revenue,
    profitability and future growth are substantially dependent upon
    the prevailing and future prices for oil and natural gas, which
    are dependent upon numerous factors beyond its control such as
    economic, political and regulatory developments and competition
    from other energy sources. The energy markets have historically
    been very volatile and there can be no assurance that oil and
    natural gas prices will not be subject to wide fluctuations in
    the future. A substantial or extended decline in oil and natural
    gas prices could have a material adverse effect on the
    Company's financial position, results of operations, cash
    flows and quantities of oil and natural gas reserves that may be
    economically produced.
Estimates of oil and natural gas reserves and their values,
    future production rates and future costs and expenses are
    inherently uncertain for numerous reasons, including many
    factors beyond the Company's control. Reservoir engineering
    is a subjective process of estimating underground accumulations
    of oil and natural gas that cannot be measured in an exact
    manner. The accuracy of any reserve estimate is a function of
    the quality of data available and of engineering and geological
    interpretation and judgment. In addition, estimates of reserves
    may be revised based on actual production, results of subsequent
    exploitation and development activities, prevailing commodity
    prices, operating cost and other factors. These revisions may be
    material and could materially affect future depletion,
    depreciation and amortization expense, dismantlement and
    abandonment costs, and impairment expense.
Cash
    and Cash Equivalents
All short-term investments purchased with an original maturity
    of three months or less are considered cash equivalents. The
    Company's short-term investments are composed of overnight
    bank transfers of funds from bank accounts to an offshore United
    States Dollar denominated interest bearing account. Invested
    funds and earned interest amounts are returned to the
    Company's accounts the next business day. Cash equivalents
    are stated at cost, which approximates market value.
Accounts
    Receivable
Accounts receivable are carried on a gross basis, with no
    discounting. The Company regularly reviews all aged accounts
    receivable for collectability and establishes an allowance as
    necessary for individual customer balances. No allowance for
    doubtful accounts was recorded for the years ended
    December 31, 2009 and 2008.
Inventory
Equipment and materials consist primarily of tubular goods and
    well equipment to be used in future drilling or repair
    operations and are stated at the lower of cost or market with
    cost determined on an average cost method. Crude oil inventories
    are valued at the lower of average cost or market value.
    Inventory consists of the following:
December 31,
2009
2008
(In thousands)
Equipment and materials
$
588
$
1,117
Crude oil inventory
670
452
$
1,258
$
1,569
F-8
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Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
Joint
    Interest Partner Advances
The Company participates in the drilling of oil and gas wells
    with other working interest partners. Due to the capital
    intensive nature of oil and natural gas drilling activities, the
    working interest partner responsible for conducting the drilling
    operations may request advance payments from other working
    interest partners for their share of the costs. The Company
    expects such advances to be applied by working interest partners
    against joint interest billings for its share of drilling
    operations within 90 days from when the advance is paid.
Property,
    Plant and Equipment
Proved
    Oil and Gas Properties
Oil and natural gas exploration and development activities are
    accounted for using the successful efforts method. Under this
    method, all property acquisition costs and costs of exploratory
    and development wells are capitalized when incurred, pending
    determination of whether the well has found proved reserves. If
    an exploratory well does not find proved reserves, the costs of
    drilling the well are charged to expense. The costs of
    development wells are capitalized whether productive or
    nonproductive. All capitalized well costs and leasehold costs of
    proved properties are amortized on a
unit-of-production
basis over the remaining life of proved developed reserves and
    proved reserves, respectively.
The provision for depreciation, depletion and amortization
    ("DD&A") of oil and natural gas properties is
    calculated on a
field-by-field
basis using the
unit-of-production
method. Natural gas is converted to barrel equivalents at the
    rate of six thousand cubic feet of natural gas to one barrel of
    oil. The calculation for the
unit-of-production
DD&A method takes into consideration estimated future
    dismantlement, restoration and abandonment costs, which are net
    of estimated salvage values.
Costs of retired, sold or abandoned properties that constitute a
    part of an amortization base (partial field) are charged or
    credited, net of proceeds, to accumulated depreciation,
    depletion and amortization unless doing so significantly affects
    the
unit-of-production
amortization rate for an entire field, in which case a gain or
    loss is recognized currently. In December 2009, the Company sold
    its interests in non-core oil and natural gas producing
    properties located in the Barnett shale in Texas for an
    aggregate $1.5 million in cash. The Company recognized a
    gain of $1.4 million from the sale of these divested
    properties.
Expenditures for maintenance, repairs and minor renewals
    necessary to maintain properties in operating condition are
    expensed as incurred. Major betterments, replacements and
    renewals are capitalized to the appropriate property and
    equipment accounts. Estimated dismantlement and abandonment
    costs for oil and natural gas properties are capitalized, net of
    salvage, at their estimated net present value and amortized on a
unit-of-production
basis over the remaining life of the related proved developed
    reserves.
The Company reviews its proved oil and natural gas properties
    for impairment whenever events and circumstances indicate that a
    decline in the recoverability of their carrying value may have
    occurred. The Company estimates the expected undiscounted future
    cash flows of its oil and natural gas properties and compares
    such undiscounted future cash flows to the carrying amount of
    the oil and natural gas properties to determine if the carrying
    amount is recoverable. If the carrying amount exceeds the
    estimated undiscounted future cash flows, the Company will
    adjust the carrying amount of the oil and natural gas properties
    to fair value. The factors used to determine fair value are
    subject to management's judgement and expertise and
    include, but are not limited to, recent sales prices of
    comparable properties, the present value of future cash flows,
    net of estimated operating and development costs using estimates
    of proved reserves, future commodity pricing, future production
    estimates, anticipated capital expenditures and various discount
    rates commensurate with the risk and current market conditions
    associated with realizing the expected cash flows projected.
    During the years ended December 31, 2009 and 2008, the
    Company recorded a $0.8 million and a $45.5 million
    non-cash impairment charge, respectively, on its proved oil and
    natural gas properties. No impairment on proved oil and natural
    gas properties was recorded for the period ended
    December 31, 2007.
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Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
Unproved
    Oil and Gas Properties
Unproved properties consist of costs incurred to acquire
    unproved leases ("lease acquisition costs"). Unproved
    lease acquisition costs are capitalized until the leases expire
    or when the Company specifically identifies leases that will
    revert to the lessor, at which time the Company expenses the
    associated unproved lease acquisition costs. The expensing of
    the unproved lease acquisition costs is recorded as Impairment
    of Oil and Gas Properties in the Consolidated Statement of
    Operations. Lease acquisition costs related to successful
    exploratory drilling are reclassified to proved properties and
    depleted on a
unit-of-production
basis.
The Company assesses its unproved properties periodically for
    impairment on a
property-by-property
basis based on remaining lease terms, drilling results or future
    plans to develop acreage and records impairment expense for any
    decline in value. As a result of expiring unproved property
    leases, the Company recorded non-cash impairment charges of
    $5.4 million, $1.6 million and $1.2 million for
    the years ended December 31, 2009 and 2008 and the period
    ended December 31, 2007, respectively.
For sales of entire working interests in unproved properties,
    gain or loss is recognized to the extent of the difference
    between the proceeds received and the net carrying value of the
    property. Proceeds from sales of partial interests in unproved
    properties are accounted for as a recovery of costs unless the
    proceeds exceed the entire cost of the property.
Other
    Property and Equipment
Furniture, equipment and leasehold improvements are recorded at
    cost and are depreciated on the straight-line method based on
    expected lives of the individual assets. The Company uses a five
    year period as the estimated life for these types of assets. The
    cost of assets disposed of and the associated accumulated
    depletion, depreciation and amortization are removed from the
    Company's Consolidated Balance Sheet with any gain or loss
    realized upon the sale or disposal included in the
    Company's Consolidated Statement of Operations.
The following table sets forth the Company's property,
    plant and equipment:
December 31,
2009
2008
(In thousands)
Proved oil and gas properties
$
195,546
$
115,439
Less: Accumulated depreciation, depletion, amortization and
    impairment
(62,330
)
(46,188
)
Proved oil and gas properties, net
133,216
69,251
Unproved oil and gas properties
47,804
44,382
Other property and equipment
866
747
Less: Accumulated depreciation
(313
)
(160
)
Other property and equipment, net
553
587
Total property, plant and equipment, net
$
181,573
$
114,220
Exploration
    Expenses
Costs from drilling exploratory wells are initially capitalized,
    but charged to expense if and when a well is determined to be
    unsuccessful. Determination is usually made on or shortly after
    drilling or completing the well, however, in certain situations
    a determination cannot be made when drilling is completed. The
    Company defers capitalized exploratory drilling costs for wells
    that have found a sufficient quantity of producible hydrocarbons
    but cannot be classified as proved because they are located in
    areas that require major capital expenditures or governmental or
    other regulatory approvals before production can begin. These
    costs continue
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Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
to be deferred as wells-in-progress as long as development is
    underway, is firmly planned for the near future or the necessary
    approvals are actively being sought.
Other exploration costs, including certain geological and
    geophysical expenses and delay rentals for oil and gas leases,
    are charged to expense as incurred.
Net changes in capitalized exploratory well costs are reflected
    in the following table for the periods presented:
December 31,
2009
2008
(In thousands)
Beginning of period
$
324
$
—
Exploratory well cost additions (pending determination of proved
    reserves)
72,972
38,666
Exploratory well cost reclassifications (successful
    determination of proved reserves)
(72,869
)
(37,633
)
Exploratory well dry hole costs (unsuccessful in adding proved
    reserves)
—
(709
)
End of period
$
427
$
324
For the period ended December 31, 2007, the Company's
    drilling activity was conducted on proved undeveloped leasehold
    locations, and as such, there were no exploratory wells drilled
    in 2007.
As of December 31, 2009, the Company had no exploratory
    well costs that were capitalized for a period greater than one
    year.
Deferred
    Costs
The Company capitalizes costs incurred in connection with
    obtaining financing. These costs are included in Deferred Costs
    and Other Assets on the Company's Consolidated Balance
    Sheet and are amortized over the term of the related financing
    using the straight-line method, which approximates the effective
    interest method.
Asset
    Retirement Obligations
In accordance with the Financial Accounting Standard
    Board's, or FASB's, authoritative guidance on asset
    retirement obligations, or ARO, the Company records the fair
    value of a liability for a legal obligation to retire an asset
    in the period in which the liability is incurred with the
    corresponding cost capitalized by increasing the carrying amount
    of the related long-lived asset. For oil and gas properties,
    this is the period in which the well is drilled or acquired. The
    ARO represents the estimated amount the Company will incur to
    plug, abandon and remediate the properties at the end of their
    productive lives, in accordance with applicable state laws. The
    liability is accreted to its present value each period and the
    capitalized costs are depreciated using the
unit-of-production
method. The accretion expense is recorded as a component of
    Depreciation, Depletion and Amortization in the Company's
    Consolidated Statement of Operations.
The Company determines the ARO by calculating the present value
    of estimated cash flows related to the liability. Estimating the
    future ARO requires management to make estimates and judgments
    regarding timing, and existence of a liability, as well as what
    constitutes adequate restoration. Inherent in the fair value
    calculation are numerous assumptions and judgments including the
    ultimate costs, inflation factors, credit adjusted discount
    rates, timing of settlement and changes in the legal,
    regulatory, environmental and political environments. These
    assumptions represent Level 3 inputs, as further discussed in
    Note 4 — Fair Value Measurements. To the extent
    future revisions to these assumptions impact the fair value of
    the existing ARO liability, a corresponding adjustment is made
    to the related asset.
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Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
Revenue
    Recognition
Revenue from the Company's interests in producing wells is
    recognized when the product is delivered, at which time the
    customer has taken title and assumed the risks and rewards of
    ownership, and collectability is reasonably assured.
    Substantially all of the Company's production is sold to
    purchasers under short-term (less than 12 months) contracts
    at market based prices. The sales prices for oil and natural gas
    are adjusted for transportation and quality differentials. These
    differentials are based on contractual or historical data and do
    not require significant judgment. Subsequently, these revenue
    differentials are adjusted to reflect actual charges based on
    third-party documents. Since there is a ready market for oil and
    natural gas, the Company sells the majority of its production
    soon after it is produced at various locations. As a result, the
    Company maintains a minimum amount of product inventory in
    storage.
Production
    Taxes and Royalties Payable
The Company calculates and pays taxes and royalties on oil and
    natural gas in accordance with the particular contractual
    provisions of the lease, license or concession agreements and
    the laws and regulations applicable to those agreements.
Concentrations
    of Market Risk
The future results of the Company's oil and natural gas
    operations will be affected by the market prices of oil and
    natural gas. The availability of a ready market for oil and
    natural gas products in the future will depend on numerous
    factors beyond the control of the Company, including weather,
    imports, marketing of competitive fuels, proximity and capacity
    of oil and natural gas pipelines and other transportation
    facilities, any oversupply or undersupply of oil, natural gas
    and liquid products, the regulatory environment, the economic
    environment, and other regional and political events, none of
    which can be predicted with certainty.
The Company operates in the exploration, development and
    production sector of the oil and gas industry. The
    Company's receivables include amounts due from purchasers
    of its oil and natural gas production and amounts due from joint
    venture partners for their respective portions of operating
    expense and exploration and development costs. While certain of
    these customers and joint venture partners are affected by
    periodic downturns in the economy in general or in their
    specific segment of the oil or natural gas industry, the Company
    believes that its level of credit-related losses due to such
    economic fluctuations has been and will continue to be
    immaterial to the Company's results of operations over the
    long-term.  Trade receivables are generally not
    collateralized.
Concentrations
    of Credit Risk
The Company manages and controls market and counterparty credit
    risk. In the normal course of business, collateral is not
    required for financial instruments with credit risk. Financial
    instruments which potentially subject the Company to credit risk
    consist principally of temporary cash balances and derivative
    financial instruments. The Company maintains cash and cash
    equivalents in bank deposit accounts which, at times, may exceed
    the federally insured limits. The Company has not experienced
    any significant losses from such investments. The Company
    attempts to limit the amount of credit exposure to any one
    financial institution or company.
As of December 31, 2009, the Company's customer base
    consists primarily of a major oil refining company, an oil and
    gas marketing firm, a large natural gas processing company and
    smaller oil and gas producers. The Company believes the credit
    quality of its customers is generally high. In the normal course
    of business, letters of credit or parent guarantees are required
    for counterparties which management perceives to have a higher
    credit risk.
F-12
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Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
Risk
    Management
The Company utilizes derivative financial instruments (primarily
    swaps and zero-cost collars) to manage risks related to changes
    in oil prices. As of December 31, 2009, the Company
    utilized fixed-price swap agreements and zero-cost collar
    options to reduce the volatility of oil prices on a significant
    portion of the Company's future expected oil production.
    See Note 5 — Derivative Instruments.
The Company records all derivative instruments on the balance
    sheet as either assets or liabilities measured at their
    estimated fair value. The Company has not designated any
    derivative instruments as hedges for accounting purposes and
    does not enter into such instruments for speculative trading
    purposes. Realized gains and losses from the settlement of
    commodity derivative instruments and unrealized gains and losses
    from valuation changes in the remaining unsettled commodity
    derivative instruments are reported in the Other Income
    (Expense) section of the Company's Consolidated Statement
    of Operations. Unrealized gains are included in current and
    noncurrent assets and unrealized losses are included in current
    and noncurrent liabilities on the Consolidated Balance Sheet,
    respectively.
Derivative financial instruments that hedge the price of oil are
    generally executed with major financial or commodities trading
    institutions that expose the Company to market and credit risks
    and which may, at times, be concentrated with certain
    counterparties or groups of counterparties. The Company has
    derivatives in place with two counterparties, one of which is a
    lender under the Company's revolving credit facility.
    Although notional amounts are used to express the volume of
    these contracts, the amounts potentially subject to credit risk
    in the event of nonperformance by the counterparties are
    substantially smaller. The credit worthiness of the
    counterparties is subject to continual review. The Company
    believes the risk of nonperformance by its counterparties is
    low. Full performance is anticipated, and the Company has no
    past-due receivables from its counterparties. The Company's
    policy is to execute financial derivatives only with major,
    credit-worthy financial institutions.
The Company's derivative contracts are documented with
    industry standard contracts known as a Schedule to the Master
    Agreement and International Swaps and Derivative Association,
    Inc. Master Agreement ("ISDA"). Typical terms for the
    ISDAs include credit support requirements, cross default
    provisions, termination events and set-off provisions. The
    Company is not required to provide any credit support to its
    counterparties other than cross collateralization with the
    properties securing the Company's revolving credit
    facility. See Note 7 — Long-Term Debt. As of
    December 31, 2009, the revolving credit facility limited
    the total amount of current year production that may be hedged
    by the Company to 80% of projected production from proved
    developed producing reserves. As of December 31, 2009, the
    contractual commodity derivative volumes for 2010 and 2011
    represent approximately 62% and 32%, respectively, of volumes
    from proved developed producing reserves, based on the
    Company's reserve estimates at December 31, 2009.
Environmental
    Costs
Environmental expenditures are expensed or capitalized, as
    appropriate, depending on their future economic benefit.
    Expenditures that relate to an existing condition caused by past
    operations, and which do not have future economic benefit, are
    expensed. Liabilities related to future costs are recorded on an
    undiscounted basis when environmental assessments
and/or
remediation activities are probable and the costs can be
    reasonably estimated.
Income
    Taxes
Because the Company is electing to be treated as a partnership
    for tax purposes, the income or loss of the Company for federal
    and state income tax purposes is allocated to its members in
    accordance with the Oasis Agreement, as amended. Members are
    responsible for reporting their share of taxable income or loss
    on their
F-13
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
separate income tax returns. Accordingly, no recognition has
    been given to federal or state income taxes in the accompanying
    consolidated financial statements.
The Company incurred a net loss for both book and income tax
    purposes for the years ended December 31, 2009 and 2008 and
    the period ended December 31, 2007. As a result, each
    investor member was allocated net tax losses and the Company was
    not obligated to make cash tax distribution payments to its
    members.
Member
    Contributions and Distributions
The Oasis Agreement, as amended, defines the maximum amount of
    capital contribution commitment and the associated capital
    contribution percentage for each member. The Company's
    Board of Managers determines whether capital contributions shall
    be made to the Company during the Commitment Period. Members are
    required to transfer funds for capital contributions, according
    to their respective percentages, upon receipt of a written
    notice from the Board of Managers. Capital contributions were
    $104.6 million, $80.5 million and $49.9 million
    for the years ended December 31, 2009 and 2008 and the
    period ended December 31, 2007, respectively. In connection
    with each of its capital contributions, EnCap receives a
    placement fee in an amount equal to 2% of its capital
    contributions. Such placement fees are remitted by the Company
    to EnCap or its designee. Placement fees were $1.6 million,
    $1.2 million and $1.0 million for contributions made
    in 2009 and 2008 and the period ended December 31, 2007,
    respectively.
The Oasis Agreement, as amended, also defines the allocation of
    costs and revenues, which is proportionate to the members'
    respective ownership percentage, as well as income tax
    allocations for each of the members' accounts. The Company
    is responsible for providing income tax information related to
    each members' account in order for such member to meet
    applicable state and federal tax reporting and filing
    requirements. Within 90 days after the end of each taxable
    year in which there is taxable income and sufficient working
    capital, as determined by the Board of Managers, the Company is
    obligated to make tax distributions to each member equal to tax
    obligations arising from the application of combined federal and
    applicable state and local income tax rates to such
    member's share of taxable income for that tax year. Tax
    distributions are treated as capital advances and the cumulative
    amount of such advances will be deducted from future
    distribution events that are not tax distributions.
Distribution events, such as the sale or disposition of assets,
    are made according to the distribution percentages specified in
    the Oasis Agreement, as amended. There were no such
    distributions made in 2009 or 2008.
Fair
    Value of Financial and Non-Financial Instruments
The carrying value of cash and cash equivalents, accounts
    receivable, accounts payable and other payables approximate
    their respective fair market values due to their short
    maturities. The Company's derivative instruments, long-term
    debt and asset retirement obligations are also recorded on the
    balance sheet at amounts which approximate fair market value.
    See Note 4 — Fair Value Measurements.
Recent
    Accounting Pronouncements
FASB Codification
— In June 2009, the FASB
    issued authoritative guidance on the hierarchy of generally
    accepted accounting principles ("GAAP"), which
    established only two levels of GAAP, authoritative and
    non-authoritative. The FASB Accounting Standards Codification
    (the "Codification") became the single source of
    authoritative, nongovernmental GAAP, except for rules and
    interpretive releases of the SEC, which are sources of
    authoritative GAAP for SEC registrants. All other
    non-grandfathered, non-SEC accounting literature not included in
    the Codification became non-authoritative. The Codification is
    effective for financial statements issued for interim or annual
    reporting periods ending after September 15, 2009. As the
    Codification was not
F-14
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
intended to change or alter existing GAAP, it did not have any
    impact on the Company's consolidated financial position,
    cash flows or results of operations.
Subsequent Events
— In May 2009, the FASB
    issued authoritative guidance on subsequent events in order to
    establish general standards of accounting for and disclosures of
    events that occur after the balance sheet date but before
    financial statements are issued or are available to be issued.
    Particular importance has been placed on the period after the
    balance sheet date during which management should evaluate
    events or transactions that may occur, leading to recognition
    within the financial statements or disclosure in the financial
    statements. This guidance is effective for financial statements
    issued for interim or annual reporting periods ending after
    June 15, 2009. The adoption did not have a significant
    impact on the Company's consolidated financial position,
    cash flows or results of operations. See
    Note 11 — Subsequent Events.
Fair Value Measurements
— In September 2006,
    the FASB issued authoritative guidance on fair value
    measurements. This guidance defines fair value, establishes a
    framework for measuring fair value and expands disclosure
    requirements regarding fair value measurement. This guidance was
    effective for all recurring measures of financial assets and
    financial liabilities for fiscal years beginning after
    November 15, 2007, and was adopted by the Company on
    January 1, 2008. In February 2008, the FASB amended the
    authoritative guidance to delay the effective date of fair value
    accounting for nonfinancial assets and liabilities that are
    recognized or disclosed at fair value on a nonrecurring basis
    until fiscal years beginning after November 15, 2008.
    Beginning January 1, 2009, the Company implemented the
    guidance for nonfinancial assets and liabilities. The adoption
    of this guidance did not have an impact on the Company's
    consolidated financial position, results of operations or cash
    flows.
In April 2009, the FASB amended existing authoritative guidance
    to provide additional application guidance and enhance
    disclosures regarding fair value measurements. This guidance
    intends to provide guidelines for making fair value measurements
    more consistent with other authoritative guidance and enhance
    consistency in financial reporting by increasing the frequency
    of fair value disclosures. This guidance is effective for
    interim and annual reporting periods ending after June 15,
    2009, with early adoption permitted for periods ending after
    March 15, 2009. The adoption of this guidance did not have
    a significant impact on the Company's financial position,
    cash flows or results of operations. See Note 4 —
    Fair Value Measurements.
In February 2010, the FASB enhanced existing authoritative
    guidance on certain disclosure requirements and added two new
    disclosure requirements related to fair value measurements. The
    guidance requires a gross presentation of activities within the
    Level 3 roll forward and adds a new requirement to disclose
    details of significant transfers in and out of Level 1 and
    2 measurements and the reasons for the transfers. The new
    disclosures are required for all companies required to provide
    disclosures about recurring and nonrecurring fair value
    measurements, and are effective for the first interim or annual
    reporting period beginning after December 15, 2009, except
    for the gross presentation of the Level 3 roll forward
    information, which is required for annual reporting periods
    beginning after December 15, 2010 and for reporting periods
    within those years. The Company does not expect the adoption of
    this new guidance to have a significant impact on its financial
    position, cash flows or results of operations.
Oil and Gas Reporting Requirements
— In
    December 2008, the Securities and Exchange Commission
    ("SEC") released its final rule, "Modernization
    of Oil and Gas Reporting", which adopts revisions to the
    SEC's oil and gas reporting disclosure requirements. The
    disclosure requirements under this final rule require reporting
    of oil and gas reserves using the unweighted arithmetic average
    of the
first-day-of-the-month
price for the preceding twelve months rather than year-end
    prices, and the use of new technologies to determine proved
    reserves if those technologies have been demonstrated to result
    in reliable conclusions about reserves volumes. Companies are
    allowed, but not required, to disclose probable and possible
    reserves in SEC filings. In addition, companies are required to
    report the independence and qualifications of their reserves
    preparer or auditor and file reports when a third party is
    relied upon to prepare reserves estimates or conduct a reserves
    audit. In January 2010, the FASB issued authoritative guidance
    on oil and gas reserve estimation and
F-15
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
disclosure, aligning their requirements with the SEC's
    final rule. The Company has presented and applied this new
    guidance for the year ended December 31, 2009 herein. See
    Note 13 — Supplemental Oil and Gas Reserve
    Information — Unaudited.
Disclosures about Derivative Instruments and Hedging
    Activities —
In March 2008, the FASB issued
    authoritative guidance related to disclosures about derivative
    instruments and hedging activities. Disclosures previously
    required only for the annual financial statements are now
    required in interim financial statements. This guidance is
    intended to improve financial reporting about derivative
    instruments and hedging activities by requiring companies to
    enhance disclosure about how these instruments and activities
    affect their financial position, performance and cash flows and
    to improve the transparency of the location and amounts of
    derivative instruments in a company's financial statements
    and how they are accounted for. This guidance was effective for
    the Company beginning January 1, 2009. The adoption of this
    guidance did not have a significant impact on the Company's
    consolidated financial position, results of operations or cash
    flows. See Note 5 — Derivative Instruments.
Business Combinations
— In December 2007, the
    FASB revised the authoritative guidance for business
    combinations, extending its applicability to all transactions
    and other events in which one entity obtains control over one or
    more other businesses. The revised guidance broadens the fair
    value measurement and recognition of assets acquired,
    liabilities assumed and interests transferred as a result of
    business combinations and requires that acquisition-related
    costs incurred prior to the acquisition be expensed. The revised
    guidance also expands the definition of what qualifies as a
    business, and this expanded definition could include prospective
    oil and gas purchases. Additionally, this guidance expands the
    required disclosures to improve the financial statement
    users' abilities to evaluate the nature and financial
    effects of business combinations. The guidance is effective for
    business combinations for which the acquisition date is on or
    after January 1, 2009. The Company has presented and
    applied this new guidance for all 2009 acquisitions that
    qualified as a business combination. See Note 3 —
    Acquisitions.
Non-Controlling Interests in Consolidated Financial
    Statements —
In December 2007, the FASB issued
    authoritative guidance which improves the relevance,
    comparability and transparency of the financial information that
    a reporting entity provides in its consolidated financial
    statements by establishing accounting and reporting standards
    for the non-controlling interest in a subsidiary and for the
    deconsolidation of a subsidiary. This guidance is effective for
    fiscal years beginning after December 15, 2008. The
    adoption of this guidance did not have a significant impact on
    the Company's consolidated financial position, results of
    operations or cash flows.
3.
Acquisitions
Kerogen Acquisition
— On June 15, 2009,
    the Company acquired interests in certain oil and gas properties
    primarily in the East Nesson area of the Williston Basin from
    Kerogen Resources, Inc. (the "Kerogen Acquisition
    Properties") for $27.1 million (subject to closing
    adjustments). In addition to acquiring the interests in the East
    Nesson project area, the Company also acquired non-operated
    interests in the Sanish project area.
The acquisition qualifies as a business combination, and as
    such, the Company estimated the fair value of these properties
    as of the June 15, 2009 acquisition date. The fair value is
    the price that would be received to sell an asset or paid to
    transfer a liability in an orderly transaction between market
    participants at the measurement date (exit price). Fair value
    measurements also utilize assumptions of market participants.
    The Company used a discounted cash flow model and made market
    assumptions as to future commodity prices, projections of
    estimated quantities of oil and natural gas reserves,
    expectations for timing and amount of future development and
    operating costs, projections of future rates of production,
    expected recovery rates and risk adjusted discount rates. These
    assumptions represent Level 3 inputs, as further discussed
    under Note 4 — Fair Value Measurements.
F-16
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Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
The Company estimates the fair value of the Kerogen Acquisition
    Properties to be approximately $27.1 million, which the
    Company considers to be representative of the price paid by a
    typical market participant. This measurement resulted in no
    goodwill or bargain purchase being recognized. The acquisition
    related costs were insignificant.
The following table summarizes the consideration paid for the
    Kerogen Acquisition Properties and the fair value of the assets
    acquired and liabilities assumed as of June 15, 2009. The
    purchase price allocation is preliminary and subject to
    adjustment, as the final closing statement will be complete
    during first quarter of 2010.
Consideration given to Kerogen Resources, Inc. (in thousands):
Cash
$
27,087
Recognized amounts of identifiable assets acquired and
    liabilities assumed:
Proved developed properties
$
25,178
Proved undeveloped properties
1,647
Unproved lease acquisition costs
360
Seismic costs
667
Asset retirement obligations
(765
)
Total identifiable net assets
$
27,087
Summarized below are the consolidated results of operations for
    the years ended December 31, 2009 and 2008, on an unaudited
    pro forma basis, as if the acquisition had occurred on January 1
    of each of the periods presented. The unaudited pro forma
    financial information was derived from the historical
    consolidated statements of operations of the Company and the
    statements of revenues and direct operating expenses for the
    Kerogen Acquisition Properties, which were derived from the
    historical accounting records of the seller. The unaudited pro
    forma financial information does not purport to be indicative of
    results of operations that would have occurred had the
    transaction occurred on the basis assumed above, nor is such
    information indicative of the Company's expected future
    results of operations.
Year Ended December 31,
2009
2008
Actual
Pro Forma
Actual
Pro Forma
(In thousands)
Unaudited
Kerogen Acquisition Properties:
Revenues
$
37,755
$
41,999
$
34,736
$
51,314
Net Loss
$
(15,209
)
$
(15,461
)
$
(34,391
)
$
(25,858
)
Fidelity Acquisition
— On September 30,
    2009, the Company acquired additional interests in the East
    Nesson project area of the Williston Basin from Fidelity
    Exploration and Production Company (the "Fidelity
    Acquisition Properties") for $10.7 million (subject to
    closing adjustments).
The acquisition qualifies as a business combination, and as
    such, the Company estimated the fair value of these properties
    as of the September 30, 2009 acquisition date. The Company
    used a discounted cash flow model and made market assumptions as
    to future commodity prices, projections of estimated quantities
    of oil and natural gas reserves, expectations for timing and
    amount of future development and operating costs, projections of
    future rates of production, expected recovery rates and risk
    adjusted discount rates. These assumptions represent
    Level 3 inputs, as further discussed under
    Note 4 — Fair Value Measurements.
The Company estimates the fair value of the Fidelity Acquisition
    Properties to be approximately $10.7 million, which the
    Company considers to be representative of the price paid by a
    typical market
F-17
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Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
participant. This measurement resulted in no goodwill or bargain
    purchase being recognized. The acquisition related costs were
    insignificant.
The following table summarizes the consideration paid for the
    Fidelity Acquisition Properties and the fair value of the assets
    acquired and liabilities assumed as of September 30, 2009.
    The purchase price allocation is preliminary and subject to
    adjustment, as the final closing statement will be complete
    during first quarter of 2010.
Consideration given to Fidelity Exploration and Production
    Company (in thousands):
Cash
$
10,681
Recognized amounts of identifiable assets acquired and
    liabilities assumed:
Proved developed properties
$
4,668
Proved undeveloped properties
2,415
Unproved lease acquisition costs
3,450
Seismic costs
667
Asset retirement obligations
(519
)
Total identifiable net assets
$
10,681
Summarized below are the consolidated results of operations for
    the years ended December 31, 2009 and 2008, on an unaudited
    pro forma basis as if the acquisition had occurred on January 1
    of each of the periods presented. The pro forma financial
    information was derived from the historical consolidated
    statements of operations of the Company and the statements of
    revenues and direct operating expenses for the Fidelity
    Acquisition Properties, which were derived from the historical
    accounting records of the seller. The unaudited pro forma
    financial information does not purport to be indicative of
    results of operations that would have occurred had the
    transaction occurred on the basis assumed above, nor is such
    information indicative of the Company's expected future
    results of operations.
Year Ended December 31,
2009
2008
Actual
Pro Forma
Actual
Pro Forma
(In thousands)
Unaudited
Fidelity Acquisition Properties:
Revenues
$
37,755
$
40,934
$
34,736
$
38,438
Net Loss
$
(15,209
)
$
(15,872
)
$
(34,391
)
$
(33,065
)
4.
Fair
    Value Measurements
The Company adopted the FASB's authoritative guidance on
    fair value measurements effective January 1, 2008 for
    financial assets and liabilities measured on a recurring basis.
    Beginning January 1, 2009, the Company also applied this
    guidance to non-financial assets and liabilities. The
    Company's financial assets and liabilities are measured at
    fair value on a recurring basis. The Company discloses its
    recognized non-financial assets and liabilities, such as asset
    retirement obligations and other property and equipment, at fair
    value on a non-recurring basis.
As defined in the authoritative guidance, fair value is the
    price that would be received to sell an asset or paid to
    transfer a liability in an orderly transaction between market
    participants at the measurement date ("exit price").
    To estimate fair value, the Company utilizes market data or
    assumptions that market participants would use in pricing the
    asset or liability, including assumptions about risk and the
    risks inherent in the inputs to the valuation technique. These
    inputs can be readily observable, market corroborated or
    generally unobservable.
F-18
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Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
The authoritative guidance establishes a fair value hierarchy
    that prioritizes the inputs used to measure fair value. The
    hierarchy gives the highest priority to unadjusted quoted prices
    in active markets for identical assets or liabilities
    ("Level 1" measurements) and the lowest priority
    to unobservable inputs ("Level 3" measurements).
    The three levels of the fair value hierarchy are as follows:
Level 1
— Quoted prices are available in
    active markets for identical assets or liabilities as of the
    reporting date. Active markets are those in which transactions
    for the asset or liability occur in sufficient frequency and
    volume to provide pricing information on an ongoing basis.
    Level 1 primarily consists of financial instruments such as
    exchange-traded derivatives, listed equities and
    U.S. government treasury securities.
Level 2
— Pricing inputs are other than
    quoted prices in active markets included in Level 1, which
    are either directly or indirectly observable as of the reporting
    date. Level 2 includes those financial instruments that are
    valued using models or other valuation methodologies. These
    models are primarily industry-standard models that consider
    various assumptions, including quoted forward prices for
    commodities, time value, volatility factors and current market
    and contractual prices for the underlying instruments, as well
    as other relevant economic measures. Substantially all of these
    assumptions are observable in the marketplace throughout the
    full term of the instrument, can be derived from observable data
    or are supported by observable levels at which transactions are
    executed in the marketplace. Instruments in this category
    include non-exchange-traded derivatives, such as
over-the-counter
forwards and options.
Level 3
— Pricing inputs include
    significant inputs that are generally less observable from
    objective sources. These inputs may be used with internally
    developed methodologies that result in management's best
    estimate of fair value.
As required, financial assets and liabilities are classified in
    their entirety based on the lowest level of input that is
    significant to the fair value measurement. The Company's
    assessment of the significance of a particular input to the fair
    value measurement requires judgment and may affect the valuation
    of fair value assets and liabilities and their placement within
    the fair value hierarchy levels. The following table sets forth
    by level within the fair value hierarchy the Company's
    financial assets and liabilities that were accounted for at fair
    value on a recurring basis as of December 31, 2009:
At fair value as of December 31, 2009
Level 1
Level 2
Level 3
Total
(In thousands)
Assets (Liabilities):
Commodity Derivative Instruments (see Note 5)
$
—
$
—
$
(2,953
)
$
(2,953
)
Total Derivative Instruments
$
—
$
—
$
(2,953
)
$
(2,953
)
The Level 3 instruments presented in the table above
    consist of oil swaps and collars. The Company utilizes the
mark-to-market
valuation reports provided by its counterparties for monthly
    settlement purposes to determine the valuation of its derivative
    instruments. The determination of the fair values presented
    above also incorporates a credit adjustment for non-performance
    risk, as required by GAAP. The Company calculated the credit
    adjustment for derivatives in an asset position using current
    credit default swap values for each counterparty. The credit
    adjustment for derivatives in a liability position is based on
    the Company's current cost of prime based borrowings (prime
    rate and associated margin effect). Based on these calculations,
    the Company recorded a downward adjustment to the fair value of
    its derivative instruments in the amount of $0.08 million
    at December 31, 2009.
F-19
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
The following table presents a roll forward of the derivatives
    classified as Level 3 in the fair value hierarchy for the
    year ended December 31, 2009.
Derivatives
Instruments
(In thousands)
Balance as of January 1, 2009
$
4,090
Total gains or (losses) (realized or unrealized):
Included in earnings
(4,747
)
Included in other comprehensive income
—
Purchases, issuances and settlements
(2,296
)
Transfers in and out of level 3
—
Balance as of December 31, 2009
$
(2,953
)
Change in unrealized gains (losses) included in earnings
    relating to derivatives still held at December 31, 2009
$
(7,043
)
At December 31, 2009, the Company's financial
    instruments, including cash and cash equivalents, accounts
    receivable and accounts payable, are carried at cost, which
    approximates fair value due to the short-term maturity of these
    instruments. The carrying amount of long-term debt reported in
    the Consolidated Balance Sheet at December 31, 2009 is
    $35.0 million, which approximates fair value due to the
    short term maturity of the debt obligations (see
    Note 7 — Long-Term Debt). The carrying amount of
    the Company's ARO in the Consolidated Balance Sheet at
    December 31, 2009 is $6.5 million, which also
    approximates fair value as the Company determines the ARO by
    calculating the present value of estimated cash flows related to
    the liability based on the calculation of the estimated value
    (see Note 2 — Summary of Significant Accounting
    Policies).
5.
Derivative
    Instruments
The Company utilizes derivative financial instruments to manage
    risks related to changes in oil prices. As of December 31,
    2009, the Company utilized fixed-price swap agreements and
    zero-cost collar options to reduce the volatility of oil prices
    on a significant portion of the Company's future expected
    oil production.
All derivative instruments are recorded on the balance sheet as
    either assets or liabilities measured at their estimated fair
    value (see Note 4 — Fair Value Measurements). The
    Company has not designated any derivative instruments as hedges
    for accounting purposes and does not enter into such instruments
    for speculative trading purposes. If a derivative does not
    qualify as a hedge or is not designated as a hedge, the changes
    in the fair value, both realized and unrealized, are recognized
    in the Other Income (Expense) section of the Consolidated
    Statement of Operations as a gain or loss on
mark-to-market
derivative contracts. The Company's cash flow is only
    impacted when the actual settlements under the derivative
    contracts result in making or receiving a payment to or from the
    counterparty. These cash settlements are reflected as investing
    activities in the Company's Consolidated Statement of Cash
    Flows.
F-20
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
As of December 31, 2009, the Company had the following
    outstanding commodity derivative contracts, all of which settle
    monthly, and none of which were designated as hedges:
Total Notional
Average
Average
Settlement
Derivative
Amount of Oil
Floor
Ceiling
Fair Market
Period
Instrument
(Barrels)
Prices
Prices
Fixed Price
Value
(In thousands)
2010
NYMEX Swap
11,163
$
72.25
$
(26
)
2010
NYMEX Collar
401,814
$
67.48
$
90.19
(841
)
2011
NYMEX Collar
186,764
$
61.49
$
82.23
(1,912
)
2012
NYMEX Collar
13,618
$
60.00
$
80.25
(174
)
$
(2,953
)
The following table summarizes the location and fair value of
    all outstanding commodity derivative contracts recorded in the
    balance sheet that do not qualify for hedge accounting for the
    periods presented:
Fair Value of Derivative Instrument Assets (Liabilities)
Estimated Fair Value
December 31,
Instrument Type
Balance Sheet Location
2009
2008
(In thousands)
Crude oil swap
Derivative Instruments — current assets
$
—
$
2,551
Crude oil collar
Derivative Instruments — current assets
219
733
Crude oil swap
Derivative Instruments — non-current asset
—
136
Crude oil collar
Derivative Instruments — non-current asset
—
670
Crude oil swap
Derivative Instruments — current liabilities
(26
)
—
Crude oil collar
Derivative Instruments — current liabilities
(1,061
)
—
Crude oil collar
Derivative Instruments — non-current liabilities
(2,085
)
—
Total Derivative Instruments
$
(2,953
)
$
4,090
The following table summarizes the location and amounts of
    realized and unrealized gains and losses from the Company's
    commodity derivative contracts that do not qualify for hedge
    accounting for the periods presented:
December 31,
Income Statement Location
2009
2008
(In thousands)
Derivative Contracts
Change in Unrealized Gain (Loss) on Derivative Instruments
$
(7,043
)
$
14,769
Derivative Contracts
Realized Gain (Loss) on Derivative Instruments
2,296
(6,932
)
Total Commodity Derivative Gain (Loss)
$
(4,747
)
$
7,837
F-21
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
6.
Accrued
    Liabilities
The Company's accrued liabilities consist of the following:
December 31,
2009
2008
(In thousands)
Accrued capital costs
$
14,754
$
10,620
Accrued lease operating expense
1,560
631
Accrued general and administrative expense
1,056
599
Other
668
866
Total
$
18,038
$
12,716
In addition, the Company had production taxes payable of
    $1.2 million and $0.1 million for the years ended
    December 31, 2009 and 2008, respectively, included in
    Production Taxes and Royalties Payable on the Consolidated
    Balance Sheet.
7.
Long-Term
    Debt
The Company, as parent, and OPNA, as borrower, entered into a
    credit agreement dated June 22, 2007, which was
    subsequently amended on June 10, 2008, May 13, 2009
    and June 23, 2009 (as amended, the "Credit
    Facility"). Under the Credit Facility, BNP Paribas, as
    administrative agent, and JPMorgan Chase Bank, as syndication
    agent, (collectively the "Lenders") provide the
    Company with a senior secured revolving line of credit that is
    collateralized by all of the Company's oil and natural gas
    properties. Borrowings under the Credit Facility are
    collateralized by perfected first priority liens and security
    interests on substantially all of the Company's assets,
    including mortgage liens on oil and natural gas properties
    having at least 80% of the reserve value as determined by
    reserve reports.
The Credit Facility provides for periodic scheduled
    redeterminations of the collateral value of the Company's
    oil and natural gas properties to determine the allowable
    borrowing base. Upon completing its review of the Company's
    interim oil and gas reserves report as of September 1,
    2009, the Lenders provided a letter notification that a
    $45 million maximum borrowing base would become effective
    upon payment of the associated banking fees, which were paid on
    October 19, 2009.
Borrowings under the Credit Facility are subject to varying
    rates of interest based on (1) the total outstanding
    borrowings (including the value of all outstanding letters of
    credit) in relation to the borrowing base and (2) whether
    the loan is a London Interbank Offered Rate ("LIBOR")
    loan or a bank prime interest rate loan (defined in the Credit
    Facility as an Alternate Based Rate or "ABR" loan).
    The LIBOR and ABR loans bear their respective interest rates
    plus the applicable margin indicated in the following table:
Applicable Margin
Applicable Margin
Ratio of Total Outstanding Borrowings to Borrowing Base
for LIBOR Loans
for ABR Loans
Less than .50 to 1
2.25
%
0.75
%
Greater than or equal to .50 to 1 but less than .75 to 1
2.50
%
1.00
%
Greater than or equal to .75 to 1 but less than .85 to 1
2.75
%
1.25
%
Greater than .85 to 1 but less than or equal 1
3.00
%
1.50
%
An ABR loan does not have a set maturity date and may be repaid
    at any time upon the Company providing advance notification to
    the Lenders. Interest is paid quarterly for ABR loans based on
    the number of days an ABR loan is outstanding as of the last
    business day in March, June, September and December. The Company
    has the option to convert an ABR loan to a LIBOR-based loan upon
    providing advance notification to the Lenders. The minimum
    available loan term is one month and the maximum loan term is
    six months for
F-22
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
LIBOR-based loans. Interest for LIBOR loans is paid upon
    maturity of the loan term. Interim interest is paid every three
    months for LIBOR loans that have loan terms greater than three
    months in duration. At the end of a LIBOR loan term, the Credit
    Facility allows the Company to elect to continue a LIBOR loan
    with the same or a differing loan term or convert the borrowing
    to an ABR loan. Because the Credit Facility has a final maturity
    date of June 22, 2011, outstanding borrowings are
    classified as long-term debt in the Company's Consolidated
    Balance Sheet at December 31, 2009.
On a quarterly basis, the Company also pays a 0.50% commitment
    fee on the daily amount of borrowing base capacity not utilized
    during the quarter and fees calculated on the daily amount of
    letter of credit balances outstanding during the quarter.
For LIBOR loans, interest is payable at the maturity of the loan
    term. For ABR loans, interest is payable quarterly until such
    time the ABR loan balance is repaid or converted to a LIBOR loan.
The Credit Facility contains covenants that include, among
    others:
•
a prohibition against incurring debt, subject to permitted
    exceptions;
•
a prohibition against making dividends, distributions and
    redemptions, subject to permitted exceptions;
•
a prohibition against making investments, loans and advances,
    subject to permitted exceptions;
•
restrictions on creating liens and leases on the assets of the
    Company and its subsidiaries, subject to permitted exceptions;
•
restrictions on merging and selling assets outside the ordinary
    course of business;
•
restrictions on use of proceeds, investments, transactions with
    affiliates or change of principal business;
•
a provision limiting oil and natural gas hedging transactions to
    a volume not exceeding 80 percent (other than puts or
    floors not exceeding 100 percent) of anticipated production
    from proved developed producing reserves;
•
a requirement that the Company not allow a ratio of Total Debt
    (as defined in the Credit Facility) to consolidated EBITDAX (as
    defined in the Credit Facility) to be greater than 4.5 to 1.0
    for any period to and including December 31, 2009 and to be
    greater than 4.0 to 1.0 for any period thereafter; and
•
a requirement that the Company maintain a Current Ratio of
    consolidated current assets (with exclusions as described in the
    Credit Facility) to consolidated current liabilities (with
    exclusions as described in the Credit Facility) of not less than
    1.0 to 1.0.
The Credit Facility contains customary events of default. If an
    event of default occurs and is continuing, the Lenders may
    declare all amounts outstanding under the Credit Facility to be
    immediately due and payable.
As of December 31, 2009, borrowings under the Credit
    Facility totaled $35.0 million and outstanding letters of
    credit issued under the Credit Facility totaled
    $0.2 million, resulting in unused borrowing base capacity
    of $9.8 million. The weighted average interest rate
    incurred on the outstanding Credit Facility borrowings during
    2009 was 3.5%.
F-23
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
8.
Asset
    Retirement Obligations
The following table reflects the changes in the Company's
    ARO during the years ended December 31, 2009 and 2008:
December 31,
2009
2008
(In thousands)
Asset retirement obligation — beginning of period
$
4,458
$
3,833
Liabilities incurred through acquisitions
1,285
—
Liabilities incurred during period
859
410
Liabilities settled during period
(395
)
(83
)
Accretion expense during period
362
298
Revisions to estimates
(58
)
—
Asset retirement obligation — end of period
$
6,511
$
4,458
9.
Significant
    Concentrations
Purchasers that accounted for more than 10% of the
    Company's total sales for the periods presented are as
    follows:
Period from
Year Ended
February 26, 2007
December 31,
(Inception) through
2009
2008
December 31, 2007
Tesoro Refining and Marketing Company
32%
57%
79%
Texon L.P.(1)
30%
14%
N/A
(1)
Not applicable for the period from February 26, 2007
    (Inception) through December 31, 2007 as the sales to Texon
    L.P. did not account for more than 10% of the Company's
    total sales.
No other purchasers accounted for more than 10% of the
    Company's total oil and natural gas sales for the years
    ended December 31, 2009 and 2008 and the period ended
    December 31, 2007. Management believes that the loss of any
    of these purchasers would not have a material adverse effect on
    the Company's operations, as there are a number of
    alternative oil and natural gas purchasers in the Company's
    producing regions.
Substantially all of the Company's accounts receivable
    result from sales of oil and natural gas as well as joint
    interest billings ("JIB") to third-party companies who
    have working interest payment obligations in projects completed
    by the Company. Zenergy Operating, Bristol Exploration LP and
    Abraxas Petroleum Corporation accounted for approximately 27%,
    19% and 13%, respectively, of the Company's JIB receivables
    balance at December 31, 2009. Hess Corporation and Windsor
    Bakken LLC accounted for approximately 41% and 13%,
    respectively, of the Company's JIB receivables balance at
    December 31, 2008. No other individual account balances
    accounted for more than 10% of the Company's total JIB
    receivables at December 31, 2009 and 2008.
This concentration of customers and joint interest owners may
    impact the Company's overall credit risk, either positively
    or negatively, in that these entities may be similarly affected
    by changes in economic or other conditions.
10.
Commitments
    and Contingencies
Lease Obligations
— The Company has operating
    leases for office space. The Company incurred lease rental
    expenses of $332,104 and $278,149 for the years ended
    December 31, 2009 and 2008, respectively, and
F-24
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
$119,100 for the period ended December 31, 2007. Future
    minimum annual rental commitments under noncancelable leases as
    of and subsequent to December 31, 2009 are as follows:
(In thousands)
2010
$
451
2011
387
2012
131
2013
—
Thereafter
—
$
969
Drilling Contracts
— During 2008, the Company
    entered into drilling rig contracts with two drilling
    contractors. In the fourth quarter of 2008, the Company reduced
    its planned 2009 capital expenditure program and entered into
    discussions regarding early termination of these contracts. In
    the first quarter of 2009, the Company paid a total of
    $3.0 million in rig termination fees in connection with the
    rig termination of the Company's remaining commitment under
    one drilling rig contract and the extension of the other
    drilling rig contract until June 2010. The Company agreed to
    retain an obligation to pay for 60 remaining shortfall days if
    the drilling rig was not used during the remaining term of the
    contract.
In November 2009, the Company entered into a new six-month term
    drilling rig contract, which replaced the contract the Company
    had previously extended. In the event of an early contract
    termination under this new drilling rig contract, the Company is
    obligated to pay a daily shortfall rate of $9,000 per day for
    the days remaining between the date of termination and
    May 15, 2010, the end of the primary contract term.
Litigation
— There are no claims, title matters
    or other legal proceedings arising in the ordinary course of
    business, including environmental contamination claims, personal
    injury and property damage claims, claims related to joint
    interest billings and other matters under oil and gas operating
    agreements and other contractual disputes that are pending or
    threatened against the Company at this time. The Company
    purchases and maintains general liability and other insurance to
    cover such potential liabilities.
11.
Subsequent
    Events
The Company has evaluated the period after the balance sheet
    date up through March 4, 2010, the date the consolidated
    financial statements were issued, noting no subsequent events or
    transactions that required recognition or disclosure in the
    financial statements, other than noted below.
New Drilling Rig Contract —
On January 27,
    2010, the Company entered into a new drilling rig contract. In
    the event of early contract termination under this new contract,
    the Company is obligated to pay a daily shortfall rate of $8,000
    per day for the days remaining between the date of termination
    and June 15, 2010, the end of the primary contract term. On
    February 22, 2010, the Company extended the term of this
    contract by one month to July 15, 2010. All other rates,
    terms and conditions of the rig contract remained unchanged.
Amended and Restated Credit Facility —
On
    February 26, 2010, the Company entered into an agreement
    that amended and restated the existing Credit Facility (the
    "Amended Credit Facility"). The Amended Credit
    Facility increased the initial borrowing base to a maximum of
    $85 million, defined a future borrowing base of
    $70 million (the "Conforming Borrowing Base") and
    extended the maturity date of the Amended Credit Facility to
    February 26, 2014.
If the Company does not consummate an initial public stock
    offering before October 1, 2010, then the Borrowing Base
    shall equal the Conforming Borrowing Base on that date. The
    Conforming Borrowing Base is used as the denominator when
    calculating the utilization percentage of the Amended Credit
    Facility (the dollar amount of outstanding borrowings divided by
    the Conforming Borrowing Base).
F-25
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
Borrowings under the Amended Credit Facility are subject to
    varying rates of interest based on (1) the total
    outstanding borrowings (including the value of all outstanding
    letters of credit) in relation to the borrowing base and
    (2) whether the loan is a LIBOR loan or a bank prime ABR
    loan. The LIBOR and ABR loans bear their respective interest
    rates plus the applicable margin as indicated in the following
    table:
Applicable Margin
Applicable Margin
Ratio of Total Outstanding Borrowings to Borrowing Base
for LIBOR Loans
for ABR Loans
Less than .50 to 1
2.25
%
0.75
%
Greater than or equal to .50 to 1 but less than .75 to 1
2.50
1.00
Greater than or equal to .75 to 1 but less than .85 to 1
2.75
1.25
Greater than .85 to 1 but less than or equal 1
3.00
1.50
Greater than 1 but less than 1.125
3.50
2.00
Greater than 1.125
4.00
2.50
At the time in which the Conforming Borrowing Base ceases to be
    in effect, the highest level for the Ratio of Total Outstanding
    Borrowings to Borrowing Base will be the "Greater than .85
    to 1 but less than or equal to 1" level in the above table.
The Amended Credit Facility agreement retained the same
    quarterly fee payments for commitment and letter of credit fees
    and retained the same covenants as previously described for the
    Credit Facility (see Note 7 — Long-Term Debt).
12.
Supplemental
    Oil and Gas Disclosures
The supplemental data presented herein reflects information for
    all of the Company's oil and natural gas producing
    activities.
Capitalized
    Costs
The following table sets forth the capitalized costs related to
    the Company's oil and natural gas producing activities at
    December 31, 2009 and 2008:
December 31,
2009
2008
(In thousands)
Proved properties
$
195,546
$
115,439
Less: Accumulated depreciation, depletion, amortization and
    impairment
(62,330
)
(46,188
)
Proved properties, net
133,216
69,251
Unproved properties
47,804
44,382
Total oil and gas properties, net
$
181,020
$
113,633
Pursuant to the FASB's authoritative guidance on asset
    retirement obligations, net capitalized costs include asset
    retirement costs of $5.4 million and $4.0 million at
    December 31, 2009 and 2008, respectively.
F-26
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
Costs
    Incurred in Oil and Natural Gas Property Acquisition,
    Exploration and Development Activities
The following table sets forth costs incurred related to the
    Company's oil and natural gas activities for the years
    ended December 31, 2009 and 2008 and for the period from
    February 26, 2007 (inception) through December 31,
    2007:
Year Ended December 31,
Period from
February 26, 2007
(Inception) through
2009
2008
December 31, 2007
(In thousands)
Acquisition costs:
Proved properties
$
35,134
$
36,969
$
12,862
Unproved properties
13,917
—
69,680
Exploration costs
1,019
3,222
1,164
Development costs
38,526
39,025
11,403
Asset retirement costs
1,314
—
3,712
Total costs incurred
$
89,910
$
79,216
$
98,821
Results
    of Operations for Oil and Natural Gas Producing
    Activities
Results of operations for oil and natural gas producing
    activities, which excludes straight-line depreciation, general
    and administrative expense and interest expense, are presented
    below.
Period from
February 26, 2007
December 31,
(Inception) through
2009
2008
December 31, 2007
(In thousands)
Revenues
$
37,755
$
34,736
$
13,791
Production costs
12,501
10,074
4,157
Depreciation, depletion and amortization
16,592
8,581
4,153
Exploration costs
1,019
3,222
1,164
Rig termination
3,000
—
—
Impairment of oil and gas properties
6,233
47,117
1,177
Gain on sale of properties
(1,455
)
—
—
Results of operations for oil and gas producing activities
$
(135
)
$
(34,258
)
$
3,140
13.
Supplemental
    Oil and Gas Reserve Information — Unaudited
The reserve estimates at December 31, 2009 presented in the
    table below are based on a report prepared by DeGoyler and
    MacNaughton, independent reserve engineers, in accordance with
    the FASB's new authoritative guidance on oil and gas
    reserve estimation and disclosures. The reserve estimates at
    December 31, 2008 and 2007 presented in the table below are
    based on reports prepared by W.D. Von Gonten & Co.
    using the FASB rules in effect at that time. At
    December 31, 2009, all of the Company's oil and
    natural gas producing activities were conducted within the
    continental United States.
F-27
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
The Company emphasizes that reserve estimates are inherently
    imprecise and that estimates of new discoveries and undeveloped
    locations are more imprecise than estimates of established
    proved producing oil and gas properties. Accordingly, these
    estimates are expected to change as future information becomes
    available.
Proved oil and natural gas reserves are the estimated quantities
    of oil and natural gas which geological and engineering data
    demonstrate, with reasonable certainty, to be recoverable in
    future years from known reservoirs under economic and operating
    conditions (i.e., prices and costs) existing at the time the
    estimate is made. Proved developed oil and natural gas reserves
    are proved reserves that can be expected to be recovered through
    existing wells and equipment in place and under operating
    methods being utilized at the time the estimates were made.
F-28
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
Estimated
    Quantities of Proved Oil and Natural Gas Reserves —
    Unaudited
The following table sets forth the Company's net proved,
    proved developed and proved undeveloped reserves at
    December 31, 2009, 2008 and 2007:
Oil
Gas
(MBbl)
(MMcf)
MBoe
2007 (a)
Proved reserves
Beginning balance
—
—
—
Revisions of previous estimates
(58
)
137
(35
)
Extensions, discoveries and other additions
279
42
286
Sales of reserves in place
—
—
—
Purchases of reserves in place
3,982
1,133
4,171
Production
(159
)
(73
)
(171
)
Net proved reserves at December 31, 2007
4,044
1,239
4,251
Proved developed reserves, December 31, 2007
3,266
1,083
3,447
Proved undeveloped reserves, December 31, 2007
778
156
804
2008
Proved reserves
Beginning balance
4,044
1,239
4,251
Revisions of previous estimates
(1,604
)
(479
)
(1,684
)
Extensions, discoveries and other additions
132
34
137
Sales of reserves in place
—
—
—
Purchases of reserves in place
—
—
—
Production
(379
)
(123
)
(400
)
Net proved reserves at December 31, 2008
2,193
671
2,304
Proved developed reserves, December 31, 2008
2,193
671
2,304
Proved undeveloped reserves, December 31, 2008
—
—
—
2009
Proved reserves
Beginning balance
2,193
671
2,304
Revisions of previous estimates
781
(84
)
767
Extensions, discoveries and other additions
8,381
3,414
8,950
Sales of reserves in place
(2
)
(16
)
(5
)
Purchases of reserves in place
1,726
1,611
1,995
Production
(658
)
(326
)
(712
)
Net proved reserves at December 31, 2009
12,421
5,270
13,299
Proved developed reserves, December 31, 2009
5,231
2,293
5,613
Proved undeveloped reserves, December 31, 2009
7,190
2,977
7,686
F-29
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
(a)
No beginning balance as the Company purchased the reserves from
    Bill Barrett Corporation in July 2007. Amounts represent changes
    from the date of acquisition to December 31, 2007.
Purchases
    of Reserves in Place
Of the total 1,995 MBoe of reserves purchased in 2009,
    1,511 MBoe were from the Kerogen Acquisition Properties and
    484 MBoe were from the Fidelity Acquisition Properties. The
    Company did not purchase reserves in place in 2008. In 2007, all
    of the 4,171 MBoe of total reserves purchased were from the
    properties acquired from Bill Barrett Corporation located in the
    Williston Basin.
Extensions,
    Discoveries and Other Additions
In 2009, the Company had a total of 8,950 MBoe of
    additions. An estimated 1,508 MBoe of extensions and
    discoveries were associated with new wells, which were producing
    at December 31, 2009, with approximately 95% of these
    reserves from wells producing in the Bakken or Three Forks
    formations. An additional 7,442 MBoe of proved undeveloped
    reserves were added across all three of the Company's
    Williston Basin project areas associated with the Company's
    2009 operated and non-operated drilling program, with 100% of
    these proved undeveloped reserves in the Bakken or Three Forks
    formations.
In 2008, the Company had a total of 137 MBoe of additions.
    An estimated 127 MBoe resulted from the Company's 2008
    Bakken drilling program in the East Nesson project area.
In 2007, the Company had a total of 286 MBoe of additions.
    Approximately 81 MBoe resulted from non-operated wells in
    the Company's Bakken drilling program in the West Williston
    project area. The Company also added an estimated 205 MBoe
    of proved undeveloped reserves in the conventional Madison
    formation.
Sales of
    Reserves in Place
In 2009, the Company sold a portion its interests in non-core
    oil and gas producing properties located in the Barnett shale in
    Texas, which had minimal impact on the Company's proved
    reserves. The Company had no divestitures for the year ended
    December 31, 2008 and the period ended December 31,
    2007.
Revisions
    of Previous Estimates
In 2009, the Company had net positive revisions of
    767 MBoe, primarily due to the increase in oil prices. The
    unweighted arithmetic average
first-day-of-the-month
prices for the 12 months prior were $61.04/bbl as compared
    to the market price for oil of $44.60/bbl used for the
    December 31, 2008 reserves.
In 2008, the Company had net negative revisions of
    1,684 MBoe. An estimated 461 MBoe reduction resulted
    from poor drilling results in the conventional Madison
    formation, including proved undeveloped locations offsetting the
    Madison formation drilling results. The remaining
    net 1,223 MBoe reduction is primarily related to the
    decrease in oil price, including 461 MBoe of proved
    undeveloped reserves at December 31, 2007, which did not
    have a positive
PV-10
at the
    lower oil prices and were removed from the December 31,
    2008 reserves. The index price for oil at December 31, 2008
    decreased to $44.60/bbl from $96.00/bbl at December 31,
    2007.
In 2007, the Company had net negative revisions of 35 MBoe.
    These revisions primarily resulted from adjustments to the
    performance projections and price assumptions used to calculate
    reserves at December 31, 2007 compared to those used in the
    initial evaluation of the properties acquired from Bill Barrett
    Corporation in June 2007.
F-30
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
Standardized
    Measure of Discounted Future Net Cash Flows Relating to Proved
    Oil and Natural Gas Reserves — Unaudited
The Standardized Measure represents the present value of
    estimated future cash inflows from proved oil and natural
    reserves, less future development, production, plugging and
    abandonment costs and income tax expenses, discounted at 10% per
    annum to reflect timing of future cash flows. Production costs
    do not include depreciation, depletion and amortization of
    capitalized acquisition, exploration and development costs.
Our estimated proved reserves and related future net revenues
    and Standardized Measure were determined using index prices for
    oil and natural gas, without giving effect to derivative
    transactions, and were held constant throughout the life of the
    properties. The index prices were $96.00/Bbl for oil and
    $7.16/MMBtu for natural gas at December 31, 2007, and
    $44.60/Bbl for oil and $5.63/MMBtu for natural gas at
    December 31, 2008, and the unweighted arithmetic average
first-day-of-the-month
prices for the prior 12 months were $61.04/Bbl for oil and
    $3.87/MMBtu for natural gas at December 31, 2009.  These
    prices were adjusted by lease for quality, transportation fees,
    geographical differentials, marketing bonuses or deductions and
    other factors affecting the price received at the wellhead. The
    impact of the adoption of the FASB's authoritative guidance
    on the SEC oil and gas reserve estimation final rule on our
    financial statements is not practicable to estimate due to the
    operational and technical challenges associated with calculating
    a cumulative effect of adoption by preparing reserve reports
    under both the old and new rules.
The following table sets forth the Standardized Measure of
    discounted future net cash flows from projected production of
    the Company's oil and natural gas reserves at
    December 31, 2009, 2008 and 2007.
At Year Ended December 31,
2009
2008
2007
(In thousands)
Future cash inflows
$
664,480
$
85,678
$
365,725
Future production costs
(258,137
)
(54,885
)
(117,094
)
Future development costs
(120,212
)
(3,708
)
(20,792
)
Future income tax expense(1)
—
—
—
Future net cash flows
286,131
27,085
227,839
10% annual discount for estimated timing of cash flows
(152,601
)
(9,355
)
(106,032
)
Standardized measure of discounted future net cash flows
$
133,530
$
17,730
$
121,807
(1)
Does not include the effects of income taxes on future net
    revenues because as of December 31, 2009, 2008 and 2007,
    the Company was a limited liability company not subject to
    entity-level taxation. Accordingly, no provision for federal or
    state corporate income taxes has been provided because taxable
    income is passed through to the company's equity holders.
F-31
Table of Contents
Oasis
    Petroleum LLC
Notes to
    Consolidated Financial
    Statements — (Continued)
The following table sets forth the changes in the standardized
    measure of discounted future net cash flows applicable to proved
    oil and natural gas reserves for the periods presented.
2009
2008
2007(1)
(In thousands)
January 1,
$
17,730
$
121,807
$
—
Net changes in prices and production costs
11,423
(48,986
)
38,863
Net changes in future development costs
1,998
210
(3,529
)
Sales of oil and natural gas, net
(25,254
)
(24,662
)
(9,634
)
Extensions
71,333
2,648
4,429
Discoveries
—
—
—
Purchases of reserves in place
36,809
—
78,965
Sales of reserves in place
(108
)
—
—
Revisions of previous quantity estimates
7,700
(48,260
)
(667
)
Previously estimated development costs incurred
—
746
6,476
Accretion of discount
3,352
12,181
3,948
Net change in income taxes
—
—
—
Changes in timing and other
8,547
2,046
2,956
December 31,
$
133,530
$
17,730
$
121,807
(1)
No beginning balance as the Company purchased the reserves from
    Bill Barrett Corporation in July 2007. Amounts represent changes
    from the date of acquisition to December 31, 2007.
14.
Quarterly
    Financial Data — Unaudited
The Company's results of operations by quarter for the
    years ended 2009 and 2008 are as follows:
For the Year Ended December 31, 2009:
First
Second
Third
Fourth
Quarter
Quarter
Quarter(1)
Quarter
(In thousands)
Revenues
$
3,216
$
6,036
$
11,046
$
17,457
Impairment of oil and gas properties
441
809
1,613
3,370
Operating loss
(6,091
)
(1,536
)
(329
)
(1,599
)
Net loss
$
(5,512
)
$
(5,883
)
$
(171
)
$
(3,643
)
For the Year Ended December 31, 2008:
First
Second
Third
Fourth
Quarter
Quarter
Quarter
Quarter
(In thousands)
Revenues
$
8,467
$
10,531
$
10,956
$
4,782
Impairment of oil and gas properties
259
92
884
45,882
Operating income (loss)
2,420
3,106
3,593
(48,934
)
Net income (loss)
$
(3,760
)
$
(25,361
)
$
23,287
$
(28,557
)
(1)
The Company recorded an adjustment to expense in the amount of
    $272,000 in the third quarter of 2009 associated with plugging
    and abandonment costs incurred in 2008.
F-32
Table of Contents
Report of
    Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of Oasis Petroleum
    Inc.:
In our opinion, the accompanying balance sheet presents fairly,
    in all material respects, the financial position of Oasis
    Petroleum Inc. at February 25, 2010 in conformity with
    accounting principles generally accepted in the United States of
    America. This financial statement is the responsibility of Oasis
    Petroleum Inc.'s management. Our responsibility is to
    express an opinion on this financial statement based on our
    audit. We conducted our audit of this statement in accordance
    with the standards of the Public Company Accounting Oversight
    Board (United States). Those standards require that we plan and
    perform the audit to obtain reasonable assurance about whether
    the balance sheet is free of material misstatement. An audit
    includes examining, on a test basis, evidence supporting the
    amounts and disclosures in the balance sheet, assessing the
    accounting principles used and significant estimates made by
    management, and evaluating the overall balance sheet
    presentation. We believe that our audit provides a reasonable
    basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Houston, Texas
March 4, 2010
F-33
Table of Contents
Oasis
    Petroleum Inc.
Balance Sheet
February 25, 2010
Assets
Cash
$
10
Total assets
$
10
Shareholders' equity
Common stock, $0.01 par value; authorized
    1,000 shares; 1,000 issued and outstanding at
    February 25, 2010
$
10
Total shareholders' equity
$
10
See the accompanying notes to the balance sheet.
F-34
Table of Contents
Oasis
    Petroleum Inc.
Notes
    to Balance Sheet
1.
Nature of
    Operations
Oasis Petroleum Inc. ("Oasis" or "Company")
    was formed on February 25, 2010, pursuant to the laws of
    the State of Delaware to become a holding company for Oasis
    Petroleum LLC.
2.
Summary
    of Significant Accounting Policies
Basis
    of Presentation
This balance sheet has been prepared in accordance with
    accounting principles generally accepted in the United States of
    America ("GAAP"). Separate Statements of Income,
    Changes in Stockholder's Equity and of Cash Flows have not
    been presented because Oasis has had no business transactions or
    activities to date.
F-35
Table of Contents
Report of
    Independent Registered Public Accounting Firm
To the Board of Managers of Oasis Petroleum LLC:
In our opinion, the accompanying statement of revenues and
    direct operating expenses presents fairly, in all material
    respects, the revenues and direct operating expenses of the Bill
    Barrett Corporation Acquisition Properties described in
    Note 1 for the six months ended June 30, 2007, in
    conformity with accounting principles generally accepted in the
    United States of America. This financial statement is the
    responsibility of Oasis Petroleum LLC's management. Our
    responsibility is to express an opinion on this financial
    statement based on our audit. We conducted our audit of this
    statement in accordance with the standards of the Public Company
    Accounting Oversight Board (United States). Those standards
    require that we plan and perform the audit to obtain reasonable
    assurance about whether the financial statement is free of
    material misstatement. An audit includes examining, on a test
    basis, evidence supporting the amounts and disclosures in the
    financial statement, assessing the accounting principles used
    and significant estimates made by management, and evaluating the
    overall financial statement presentation. We believe that our
    audit provides a reasonable basis for our opinion.
The accompanying financial statement reflects the revenues and
    direct operating expenses of the Bill Barrett Corporation
    Acquisition Properties as described in Note 1 and is not
    intended to be a complete presentation of the financial
    position, results of operations, or cash flows of the Bill
    Barrett Corporation Acquisition Properties.
/s/ PricewaterhouseCoopers LLP
Houston, Texas
March 4, 2010
F-36
Table of Contents
Bill
    Barrett Corporation Acquisition Properties (as Predecessor)
Statement
    of Revenue and Direct Operating Expenses
Six Months
Ended
June 30, 2007
(In thousands)
Oil and gas revenues
$
10,686
Direct operating expenses
3,490
Excess of revenues over direct operating expenses
$
7,196
See accompanying notes to the Statement of Revenues and Direct
    Operating Expenses.
F-37
Table of Contents
Bill
    Barrett Corporation Acquisition Properties (as Predecessor)
Notes
    to Statement of Revenues and Direct Operating
    Expenses
1.
Properties
    and Basis of Presentation
The accompanying statement represents the interest in the
    revenues and direct operating expenses of the oil and natural
    gas producing properties acquired by Oasis Petroleum LLC (the
    "Company") from Bill Barrett Corporation
    ("Barrett") in June 2007, which constitutes the
    accounting predecessor to the Company. The purchase transaction
    had an effective date of May 1, 2007 and the Company paid
    $83.5 million for the properties, subject to customary
    purchase accounting adjustments. The properties are referred to
    herein as the "Barrett Acquisition Properties". The
    Barrett Acquisition Properties are located in the Williston
    Basin of Montana and North Dakota. The Company closed the
    acquisition on June 22, 2007 and began managing the
    properties effective July 1, 2007.
The statement of revenues and direct operating expenses has been
    derived from Barrett's historical financial records.
    Revenues and direct operating expenses relate to the historical
    net revenue interest and net working interest, respectively, in
    the Barrett Acquisition Properties. Oil, gas and condensate
    revenues are recognized when production is sold to a purchaser
    at a fixed or determinable price, when delivery has occurred and
    title has transferred, and if collectability of the revenue is
    probable. Revenues are reported net of overriding and other
    royalties due to third parties. Direct operating expenses
    include lease and well repairs, production taxes, gathering and
    transportation, maintenance, utilities, payroll and other direct
    operating expenses. Production taxes for the six months ended
    June 30, 2007 totaled $907,000.
During the period presented, the Barrett Acquisition Properties
    were not accounted for as a separate entity. Certain costs, such
    as depreciation, depletion and amortization, accretion of asset
    retirement obligations, general and administrative expenses and
    interest expense were not allocated to the Barrett Acquisition
    Properties.
2.
Omitted
    Financial Information
Historical financial statements reflecting financial position,
    results of operations and cash flows required by accounting
    principles generally accepted in the United States of America
    are not presented as such information is not available on an
    individual property basis, nor is it practicable to obtain such
    information in these circumstances. Historically, no allocation
    of general and administrative, interest, corporate taxes,
    accretion of asset retirement obligations, and depreciation,
    depletion and amortization was made to the Barrett Acquisition
    Properties. Accordingly, the statement of revenues and direct
    operating expenses is presented in lieu of the financial
    statements required under
Rule 3-01
and
Rule 3-02
of the Securities and Exchange Commission's
Regulation S-X.
3.
Supplemental
    Oil and Gas Reserve Information — Unaudited
Estimated
    Quantities of Proved Oil and Natural Gas Reserves —
    Unaudited
The following tables summarize the net ownership interests in
    estimated quantities of proved and proved developed oil and
    natural gas reserves of the Barrett Acquisition Properties at
    January 1, 2007 and June 30, 2007, estimated by the
    Company's petroleum engineers, and the related summary of
    changes in estimated quantities of net remaining proved reserves
    during the six months ended June 30, 2007.
Proved reserves are estimated quantities of oil and natural gas
    which geological and engineering data demonstrate, with
    reasonable certainty, to be recoverable in future years from
    known reservoirs under existing economic and operating
    conditions (i.e., prices and costs) existing at the time the
    estimate is made. Proved
F-38
Table of Contents
Bill
    Barrett Corporation Acquisition Properties (as Predecessor)
Notes to
    Statement of Revenues and Direct Operating
    Expenses — (Continued)
developed reserves are proved reserves that can be expected to
    be recovered through existing wells and equipment in place and
    under operating methods being utilized at the time the estimates
    were made.
Natural Gas
Oil
(MMcf)
(MBbls)
Proved reserves at January 1, 2007
1,202
4,172
Production through June 30, 2007
(69
)
(190
)
Proved reserves at June 30, 2007
1,133
3,982
Natural Gas
Oil
(MMcf)
(MBbls)
Proved developed reserves at January 1, 2007
989
3,287
Proved developed reserves at June 30, 2007
920
3,097
Natural Gas
Oil
(MMcf)
(MBbls)
Proved undeveloped reserves at January 1, 2007
213
885
Proved undeveloped reserves at June 30, 2007
213
885
Standardized
    Measure of Discounted Future Net Cash Flows Relating to Proved
    Oil and Natural Gas Reserves — Unaudited
The following tables sets forth the computation of the
    standardized measure of discounted future net cash flows (the
    "Standardized Measure") relating to proved reserves
    and the changes in such cash flows of the Barrett Acquisition
    Properties in accordance with the Financial Accounting Standards
    Board's ("FASB") authoritative guidance related
    to disclosures about oil and gas producing activities. The
    Standardized Measure is the estimated net future cash inflows
    from proved reserves less estimated future production and
    development costs, estimated plugging and abandonment costs,
    estimated future income taxes (if applicable) and a discount
    factor. Production costs do not include depreciation, depletion
    and amortization of capitalized acquisitions, exploration and
    development costs. Future cash inflows represent expected
    revenues from production of period-end quantities of proved
    reserves based on period-end prices and any fixed and
    determinable future price changes provided by contractual
    arrangements in existence at year end. Price changes based on
    inflation, federal regulatory changes and supply and demand are
    not considered. Estimated future production costs related to
    period-end reserves are based on period-end costs. Such costs
    include, but are not limited to, production taxes and direct
    operating costs. Inflation and other anticipatory costs are not
    considered until the actual cost change takes effect. In
    accordance with the FASB's authoritative guidance, a
    discount rate of 10% is applied to the annual future net cash
    flows.
In calculating the Standardized Measure, future net cash inflows
    were estimated by using period-end oil and natural gas prices
    with the estimated future production of period-end proved
    reserves and assume continuation of existing economic
    conditions. The index prices used for the June 30, 2007
    Standardized Measure calculations were $70.68 per barrel of oil
    and $6.36 per MMBtu of natural gas. Future cash inflows were
    reduced by estimated future development, abandonment and
    production costs based on period-end costs resulting in net cash
    flow before tax. Future income tax expense was not considered as
    Oasis Petroleum LLC and the Barrett Acquisition Properties are
    not tax-paying entities.
F-39
Table of Contents
Bill
    Barrett Corporation Acquisition Properties (as Predecessor)
Notes to
    Statement of Revenues and Direct Operating
    Expenses — (Continued)
The Standardized Measure is not intended to be representative of
    the fair market value of the proved reserves. The calculations
    of revenues and costs do not necessarily represent the amounts
    to be received or expended. Accordingly, the estimates of future
    net cash flows from proved reserves and the present value
    thereof may not be materially correct when judged against actual
    subsequent results. Further, since prices and costs do not
    remain static, and no price or cost changes have been
    considered, and future production and development costs are
    estimates to be incurred in developing and producing the
    estimated proved oil and gas reserves, the results are not
    necessarily indicative of the fair market value of estimated
    proved reserves, and the results may not be comparable to
    estimates disclosed by other oil and gas producers.
June 30, 2007
(In thousands)
Future cash inflows
$
261,296
Future production costs
(97,444
)
Future development costs
(20,741
)
Future net cash flows
143,111
10% annual discount for estimating timing of cash flows
(64,997
)
Standardized Measure of discounted net cash flows relating to
    proved oil and gas reserves
$
78,114
Changes in the Standardized Measure (in thousands) of the
    Barrett Acquisition Properties are as follows:
January 1, 2007
$
65,434
Changes in prices and costs
16,473
Accretion of discount
3,403
Sales of oil and gas, net of costs
(7,196
)
June 30, 2007
$
78,114
F-40
Table of Contents
Report of
    Independent Registered Public Accounting Firm
To the Board of Managers of Oasis Petroleum LLC:
In our opinion, the accompanying statement of revenues and
    direct operating expenses presents fairly, in all material
    respects, the revenues and direct operating expenses of the
    Kerogen Acquisition Properties described in Note 1 for the
    year ended December 31, 2008, in conformity with accounting
    principles generally accepted in the United States of America.
    This financial statement is the responsibility of Oasis
    Petroleum LLC's management. Our responsibility is to
    express an opinion on this financial statement based on our
    audit. We conducted our audit of this statement in accordance
    with the standards of the Public Company Accounting Oversight
    Board (United States). Those standards require that we plan and
    perform the audit to obtain reasonable assurance about whether
    the financial statement is free of material misstatement. An
    audit includes examining, on a test basis, evidence supporting
    the amounts and disclosures in the financial statement,
    assessing the accounting principles used and significant
    estimates made by management, and evaluating the overall
    financial statement presentation. We believe that our audit
    provides a reasonable basis for our opinion.
The accompanying financial statement reflects the revenues and
    direct operating expenses of the Kerogen Acquisition Properties
    as described in Note 1 and is not intended to be a complete
    presentation of the financial position, results of operations,
    or cash flows of the Kerogen Acquisition Properties.
/s/ PricewaterhouseCoopers LLP
Houston, Texas
March 4, 2010
F-41
Table of Contents
Kerogen
    Acquisition Properties
Statements
    of Revenues and Direct Operating Expenses
Year Ended
Three Months Ended
December 31,
March 31,
2008
2008
2009
(In thousands)
(Unaudited)
(Unaudited)
Oil and gas revenues
$
16,578
$
1,084
$
2,072
Direct operating expenses
3,460
234
1,146
Excess of revenues over direct operating expenses
$
13,118
$
850
$
926
See accompanying notes to the Statement of Revenues and Direct
    Operating Expenses.
F-42
Table of Contents
Kerogen
    Acquisition Properties
Notes
    to Statements of Revenues and Direct Operating
    Expenses
1.
Properties
    and Basis of Presentation
The accompanying statements represent the interest in the
    revenue and direct operating expenses of the oil and natural gas
    producing properties acquired by Oasis Petroleum LLC (the
    "Company") from Kerogen Resources, Inc.
    ("Kerogen") on June 15, 2009 for
    $27.1 million, subject to customary purchase accounting
    adjustments. The properties are referred to herein as the
    "Kerogen Acquisition Properties".
The statement of revenues and direct operating expenses for the
    year ended December 31, 2008 has been derived from
    Kerogen's historical financial records. Revenues and direct
    operating expenses relate to the historical net revenue interest
    and net working interest, respectively, in the Kerogen
    Acquisition Properties. Oil, gas and condensate revenues are
    recognized when production is sold to a purchaser at a fixed or
    determinable price, when delivery has occurred and title has
    transferred, and if collectability of the revenue is probable.
    Revenues are reported net of overriding and other royalties due
    to third parties. Direct operating expenses include lease and
    well repairs, production taxes, gathering and transportation,
    maintenance, utilities, payroll and other direct operating
    expenses. Production taxes for the year ended December 31,
    2008 were $1.3 million.
During the periods presented, the Kerogen Acquisition Properties
    were not accounted for as a separate entity. Certain costs such
    as depreciation, depletion and amortization, accretion of asset
    retirement obligations, general and administrative expenses and
    interest expense were not allocated to the Kerogen Acquisition
    Properties.
The accompanying statements of revenues and direct operating
    expenses for the three months ended March 31, 2008 and 2009
    are unaudited. The unaudited interim statements of revenues and
    direct operating expenses have been derived from Kerogen's
    historical financial records and prepared on the same basis as
    the statement of revenues and direct operating expenses for the
    year ended December 31, 2008. In the opinion of management,
    such unaudited interim statements reflect all adjustments
    necessary to fairly present the Kerogen Acquisition
    Properties' excess of revenue over direct operating
    expenses for the three months ended March 31, 2008 and 2009.
2.
Omitted
    Financial Information
Historical financial statements reflecting financial position,
    results of operations and cash flows required by accounting
    principles generally accepted in the United States of America
    are not presented as such information is not available on an
    individual property basis, nor is it practicable to obtain such
    information in these circumstances. Historically, no allocation
    of general and administrative, interest, corporate taxes,
    accretion of asset retirement obligations, depreciation,
    depletion and amortization was made to the Kerogen Acquisition
    Properties. Accordingly, the statements of revenues and direct
    operating expenses are presented in lieu of the financial
    statements required under
Rule 3-01
and
Rule 3-02
of the Securities and Exchange Commission's
Regulation S-X.
3.
Supplemental
    Oil and Gas Reserve Information (Unaudited)
Estimated
    Quantities of Proved Oil and Natural Gas Reserves —
    Unaudited
The following tables summarize the net ownership interests in
    estimated quantities of proved and proved developed oil and
    natural gas reserves of the Kerogen Acquisition Properties at
    January 1, 2008 and December 31, 2008, estimated by
    the Company's petroleum engineers, and the related summary
    of changes in estimated quantities of net remaining proved
    reserves during the year.
F-43
Table of Contents
Kerogen
    Acquisition Properties
Notes to
    Statements of Revenues and Direct Operating
    Expenses — (Continued)
Proved reserves are estimated quantities of oil and natural gas
    which geological and engineering data demonstrate, with
    reasonable certainty, to be recoverable in future years from
    known reservoirs under existing economic and operating
    conditions (i.e., prices and costs) existing at the time the
    estimate was made. Proved developed reserves are proved reserves
    that can be expected to be recovered through existing wells and
    equipment in place and under operating methods being utilized at
    the time the estimates were made.
Natural Gas
Oil
(MMcf)
(MBbls)
Proved reserves at January 1, 2008
1,825
1,557
Production in 2008
(299
)
(172
)
Proved reserves at December 31, 2008
1,526
1,385
Natural Gas
Oil
(MMcf)
(MBbls)
Proved developed reserves at January 1, 2008
1,588
1,079
Proved developed reserves at December 31, 2008
1,289
907
Natural Gas
Oil
(MMcf)
(MBbls)
Proved undeveloped reserves at January 1, 2008
237
478
Proved undeveloped reserves at December 31, 2008
237
478
Standardized
    Measure of Discounted Future Net Cash Flows Relating to Proved
    Oil and Gas Reserves — Unaudited
The following tables set forth the computation of the
    standardized measure of discounted future net cash flows (the
    "Standardized Measure") relating to proved reserves
    and the changes in such cash flows of the Kerogen Acquisition
    Properties in accordance with the Financial Accounting Standards
    Board's ("FASB") authoritative guidance related
    to disclosures about oil and gas producing activities. The
    Standardized Measure is the estimated net future cash inflows
    from proved reserves less estimated future production and
    development costs, estimated plugging and abandonment costs,
    estimated future income taxes (if applicable) and a discount
    factor. Production costs do not include depreciation, depletion
    and amortization of capitalized acquisition, exploration and
    development costs. Future cash inflows represent expected
    revenues from production of period-end quantities of proved
    reserves based on period-end prices and any fixed and
    determinable future price changes provided by contractual
    arrangements in existence at year end. Price changes based on
    inflation, federal regulatory changes and supply and demand are
    not considered. Estimated future production costs related to
    period-end reserves are based on period-end costs. Such costs
    include, but are not limited to, production taxes and direct
    operating costs. Inflation and other anticipatory costs are not
    considered until the actual cost change takes effect. In
    accordance with the FASB's authoritative guidance, a
    discount rate of 10% is applied to the annual future net cash
    flows.
In calculating the Standardized Measure, future net cash inflows
    were estimated by using year-end oil and natural gas prices with
    the estimated future production of year-end proved reserves and
    assume continuation of existing economic conditions. The index
    prices used for the December 31, 2008 Standardized Measure
    calculations were $44.60 per barrel of oil and $5.63 per MMBtu
    of natural gas. Future cash inflows were reduced by estimated
    future development, abandonment and production costs based on
    year-end costs resulting in net cash flow before tax. Future
    income tax expense was not considered as Oasis Petroleum LLC and
    the Kerogen Acquisition Properties are not tax paying entities.
F-44
Table of Contents
Kerogen
    Acquisition Properties
Notes to
    Statements of Revenues and Direct Operating
    Expenses — (Continued)
The Standardized Measure is not intended to be representative of
    the fair market value of the proved reserves. The calculations
    of revenues and costs do not necessarily represent the amounts
    to be received or expended. Accordingly, the estimates of future
    net cash flows from proved reserves and the present value
    thereof may not be materially correct when judged against actual
    subsequent results. Further, since prices and costs do not
    remain static, and no price or cost changes have been
    considered, and future production and development costs are
    estimates to be incurred in developing and producing the
    estimated proved oil and gas reserves, the results are not
    necessarily indicative of the fair market value of estimated
    proved reserves, and the results may not be comparable to
    estimates disclosed by other oil and gas producers.
December 31,
2008
(In thousands)
Future cash inflows
$
63,010
Future production costs
(34,433
)
Future development costs
(6,853
)
Future net cash flows
21,724
10% annual discount for estimating timing of cash flows
(7,756
)
Standardized measure of discounted net cash flows relating to
    proved oil and gas reserves
$
13,968
Changes in the Standardized Measure (in thousands) of the
    Kerogen Acquisition Properties are as follows:
January 1, 2008
$
55,161
Changes in prices and costs
(29,353
)
Accretion of discount
1,278
Sales of oil and gas, net of costs
(13,118
)
December 31, 2008
$
13,968
F-45
Table of Contents
Kerogen
    Acquisition Properties
Unaudited
    Pro Forma Financial Information
On June 15, 2009, Oasis Petroleum LLC (the
    "Company") acquired interests in oil and gas
    properties primarily in the East Nesson area of the Williston
    Basin from Kerogen Resources, Inc. (the "Kerogen
    Acquisition Properties") for $27.1 million. The
    purchase price was paid using proceeds from a capital
    contribution from the members. In addition to acquiring the
    interests in the East Nesson area, the Company also acquired
    non-operated interests in the Sanish project area.
The following unaudited pro forma statement of operations shows
    the pro forma effect of the acquisition of the Kerogen
    Acquisition Properties. The Company's historical results
    include the results from the acquisition of the Kerogen
    Acquisition Properties beginning on June 15, 2009. A pro
    forma balance sheet has not been presented since the acquisition
    has been reflected in the Company's December 31, 2009
    consolidated balance sheet included elsewhere in this
    prospectus. The unaudited pro forma statement of operations for
    the year ended December 31, 2009 presented below was
    prepared as if the acquisition occurred on January 1, 2009.
The unaudited pro forma statement of operations does not
    reflect the pro forma effect of any of the Company's other
    recent acquisitions discussed in this prospectus as they were
    not deemed significant, nor does this statement reflect the
    transactions described under "Corporate
    Reorganization." The Company has conducted its operations
    as a limited liability company with substantially all earnings
    taxed at the stockholder level. Following its corporate
    reorganization, the Company will be subject to Subchapter C of
    the Internal Revenue Code, and, as a result, will become taxable
    as a corporation and subject to U.S. federal and state
    income taxes. No pro forma tax benefit has been reflected as
    management believes that it is more likely than not that such
    benefit would not be realized in the future.
Management believes that the assumptions used to prepare the
    unaudited pro forma statement of operations provide a reasonable
    basis for presenting the significant effects directly
    attributable to the transaction. The following unaudited pro
    forma statement of operations does not purport to represent what
    the Company's results of operations would have been if the
    Kerogen property acquisition had occurred on January 1,
    2009 and should be read in conjunction with the Company's
    historical consolidated financial statements and the notes to
    those financial statements and the accompanying statements of
    revenues and direct operating expenses for the Kerogen
    Acquisition Properties included elsewhere in this prospectus.
For the Year Ended December 31, 2009
Kerogen Acquisition
Properties Pro
Oasis Historical
Forma Adjustments
Oasis Pro Forma
(In thousands)
Oil and gas revenues
$
37,755
$
4,244
(1)
$
41,999
Expenses
Lease operating expenses
8,691
1,583
(1)
10,274
Production taxes
3,810
350
(1)
4,160
Depreciation, depletion and amortization
16,670
2,563
(2)
19,233
Exploration costs
1,019
—
1,019
Rig termination
3,000
—
3,000
Impairment of oil and gas properties
6,233
—
6,233
Gain on sale of properties
(1,455
)
—
(1,455
)
General and administrative
9,342
—
9,342
Total expenses
47,310
4,496
51,806
Operating loss
(9,555
)
(252
)
(9,807
)
F-46
Table of Contents
Kerogen
    Acquisition Properties
Unaudited
    Pro Forma Financial
    Information — (Continued)
For the Year Ended December 31, 2009
Kerogen Acquisition
Properties Pro
Oasis Historical
Forma Adjustments
Oasis Pro Forma
(In thousands)
Other income (expense)
Change in unrealized gain (loss) on derivative instruments
(7,043
)
—
(7,043
)
Realized gain (loss) on derivative instruments
2,296
—
2,296
Interest expense
(912
)
—
(912
)
Other income (expense)
5
—
5
Total other income (expense)
(5,654
)
—
(5,654
)
Net loss
$
(15,209
)
$
(252
)
$
(15,461
)
The following adjustments were made in the preparation of the
    unaudited pro forma consolidated financial information presented
    above:
(1)
Adjustment to recognize revenues and direct operating expenses
    of the Kerogen Acquisition Properties for the period from
    January 1, 2009 through June 14, 2009, the period for
    which financial results are not included in the historical
    results of the Company.
(2)
Adjustment to recognize additional depreciation, depletion and
    amortization on the Kerogen Acquisition Properties as if the
    acquisition had taken place on January 1, 2009, using the
unit-of-production
method under the successful efforts method of accounting. This
    adjustment also includes the additional accretion expense on the
    asset retirement obligations attributable to the Kerogen
    Acquisition Properties as if the acquisition had taken place on
    January 1, 2009.
F-47
Table of Contents
GLOSSARY
    OF OIL AND NATURAL GAS TERMS
The terms defined in this section are used throughout this
    prospectus:
"Bbl."
One stock tank barrel, of 42
    U.S. gallons liquid volume, used herein in reference to
    crude oil, condensate or natural gas liquids.
"Bcf."
One billion cubic feet of natural gas.
"Boe."
Barrels of oil equivalent, with 6,000
    cubic feet of natural gas being equivalent to one barrel of oil.
"British thermal unit."
The heat required to
    raise the temperature of a one-pound mass of water from 58.5 to
    59.5 degrees Fahrenheit.
"Basin."
A large natural depression on the
    earth's surface in which sediments generally brought by
    water accumulate.
"Completion."
The process of treating a drilled
    well followed by the installation of permanent equipment for the
    production of natural gas or oil, or in the case of a dry hole,
    the reporting of abandonment to the appropriate agency.
"Developed acreage."
The number of acres that
    are allocated or assignable to productive wells or wells capable
    of production.
"Developed reserves."
Reserves of any category
    that can be expected to be recovered through existing wells with
    existing equipment and operating methods or for which the cost
    of required equipment is relatively minor when compared to the
    cost of a new well.
"Development well."
A well drilled within the
    proved area of a natural gas or oil reservoir to the depth of a
    stratigraphic horizon known to be productive.
"Dry hole."
A well found to be incapable of
    producing hydrocarbons in sufficient quantities such that
    proceeds from the sale of such production exceed production
    expenses and taxes.
"Economically producible."
A resource that
    generates revenue that exceeds, or is reasonably expected to
    exceed, the costs of the operation.
"Environmental assessment."
An environmental
    assessment, a study that can be required pursuant to federal law
    to assess the potential direct, indirect and cumulative impacts
    of a project.
"Exploratory well."
A well drilled to find and
    produce natural gas or oil reserves not classified as proved, to
    find a new reservoir in a field previously found to be
    productive of natural gas or oil in another reservoir or to
    extend a known reservoir.
"Field."
An area consisting of a single
    reservoir or multiple reservoirs all grouped on, or related to,
    the same individual geological structural feature or
    stratigraphic condition. The field name refers to the surface
    area, although it may refer to both the surface and the
    underground productive formations.
"Formation."
A layer of rock which has distinct
    characteristics that differ from nearby rock.
"Horizontal drilling."
A drilling technique
    used in certain formations where a well is drilled vertically to
    a certain depth and then drilled at a right angle within a
    specified interval.
"Infill wells."
Wells drilled into the same
    pool as known producing wells so that oil or natural gas does
    not have to travel as far through the formation.
"MBbl."
One thousand barrels of crude oil,
    condensate or natural gas liquids.
"MBoe.
" One thousand barrels of oil equivalent.
"Mcf."
One thousand cubic feet of natural gas.
"MMBbl."
One million barrels of crude oil,
    condensate or natural gas liquids.
A-1
Table of Contents
"MMBoe."
One million barrels of oil equivalent.
"MMBtu."
One million British thermal units.
"MMcf."
One million cubic feet of natural gas.
"NYMEX."
The New York Mercantile Exchange.
"Net acres."
The percentage of total acres an
    owner has out of a particular number of acres, or a specified
    tract. An owner who has 50% interest in 100 acres owns
    50 net acres.
"PV-10."
When used with respect to oil and natural gas reserves,
PV-10
means
    the estimated future gross revenue to be generated from the
    production of proved reserves, net of estimated production and
    future development and abandonment costs, using prices and costs
    in effect at the determination date, before income taxes, and
    without giving effect to non-property-related expenses,
    discounted to a present value using an annual discount rate of
    10% in accordance with the guidelines of the Commission.
"Productive well."
A well that is found to be
    capable of producing hydrocarbons in sufficient quantities such
    that proceeds from the sale of the production exceed production
    expenses and taxes.
"Proved developed reserves."
Proved reserves
    that can be expected to be recovered through existing wells with
    existing equipment and operating methods.
"Proved reserves."
Under SEC rules for fiscal years ending on or after
    December 31, 2009, proved reserves are defined as:
Those quantities of oil and gas, which, by analysis of
    geoscience and engineering data, can be estimated with
    reasonable certainty to be economically producible —
    from a given date forward, from known reservoirs, and under
    existing economic conditions, operating methods, and government
    regulations — prior to the time at which contracts
    providing the right to operate expire, unless evidence indicates
    that renewal is reasonably certain, regardless of whether
    deterministic or probabilistic methods are used for the
    estimation. The project to extract the hydrocarbons must have
    commenced or the operator must be reasonably certain that it
    will commence the project within a reasonable time. The area of
    the reservoir considered as proved includes (i) the area
    identified by drilling and limited by fluid contacts, if any,
    and (ii) adjacent undrilled portions of the reservoir that
    can, with reasonable certainty, be judged to be continuous with
    it and to contain economically producible oil or gas on the
    basis of available geoscience and engineering data. In the
    absence of data on fluid contacts, proved quantities in a
    reservoir are limited by the lowest known hydrocarbons, LKH, as
    seen in a well penetration unless geoscience, engineering, or
    performance data and reliable technology establishes a lower
    contact with reasonable certainty. Where direct observation from
    well penetrations has defined a highest known oil, HKO,
    elevation and the potential exists for an associated gas cap,
    proved oil reserves may be assigned in the structurally higher
    portions of the reservoir only if geoscience, engineering, or
    performance data and reliable technology establish the higher
    contact with reasonable certainty. Reserves which can be
    produced economically through application of improved recovery
    techniques (including, but not limited to, fluid injection) are
    included in the proved classification when (i) successful
    testing by a pilot project in an area of the reservoir with
    properties no more favorable than in the reservoir as a whole,
    the operation of an installed program in the reservoir or an
    analogous reservoir, or other evidence using reliable technology
    establishes the reasonable certainty of the engineering analysis
    on which the project or program was based; and (ii) the
    project has been approved for development by all necessary
    parties and entities, including governmental entities. Existing
    economic conditions include prices and costs at which economic
    producibility from a reservoir is to be determined. The price
    shall be the average price during the
12-month
period prior to the ending date of the period covered by the
    report, determined as an unweighted arithmetic average of the
first-day-of-the-month
price for each month within such period, unless prices are
    defined by contractual arrangements, excluding escalations based
    upon future conditions.
Under SEC rules for fiscal years ending prior to
    December 31, 2009, proved reserves are defined as:
The estimated quantities of crude oil, natural gas, and natural
    gas liquids which geological and engineering data demonstrate
    with reasonable certainty to be recoverable in future years from
    known reservoirs
A-2
Table of Contents
under existing economic and operating conditions, i.e., prices
    and costs as of the date the estimate is made. Prices include
    consideration of changes in existing prices provided only by
    contractual arrangements, but not on escalations based upon
    future conditions. Reservoirs are considered proved if economic
    producibility is supported by either actual production or
    conclusive formation test. The area of a reservoir considered
    proved includes (A) that portion delineated by drilling and
    defined by gas-oil
and/or
oil-water contacts, if any, and (B) the immediately
    adjoining portions not yet drilled, but which can be reasonably
    judged as economically productive on the basis of available
    geological and engineering data. In the absence of information
    on fluid contacts, the lowest known structural occurrence of
    hydrocarbons controls the lower proved limit of the reservoir.
    Reserves which can be produced economically through application
    of improved recovery techniques (such as fluid injection) are
    included in the proved classification when successful testing by
    a pilot project, or the operation of an installed program in the
    reservoir, provides support for the engineering analysis on
    which the project or program was based. Estimates of proved
    reserves do not include the following: (A) Oil that may
    become available from known reservoirs but is classified
    separately as indicated additional reserves; (B) crude oil,
    natural gas, and natural gas liquids, the recovery of which is
    subject to reasonable doubt because of uncertainty as to
    geology, reservoir characteristics, or economic factors;
    (C) crude oil, natural gas, and natural gas liquids, that
    may occur in undrilled prospects; and (D) crude oil,
    natural gas, and natural gas liquids, that may be recovered from
    oil shales, coal, gilsonite and other such sources.
"Proved undeveloped reserves."
Proved reserves
    that are expected to be recovered from new wells on undrilled
    acreage or from existing wells where a relatively major
    expenditure is required for recompletion.
"Reasonable certainty."
A high degree of
    confidence.
"Recompletion."
The process of re-entering an
    existing wellbore that is either producing or not producing and
    completing new reservoirs in an attempt to establish or increase
    existing production.
"Reserves."
Estimated remaining quantities of
    oil and natural gas and related substances anticipated to be
    economically producible as of a given date by application of
    development prospects to known accumulations.
"Reservoir."
A porous and permeable underground
    formation containing a natural accumulation of producible
    natural gas
and/or
oil
    that is confined by impermeable rock or water barriers and is
    separate from other reservoirs.
"Spacing."
The distance between wells producing
    from the same reservoir. Spacing is often expressed in terms of
    acres, e.g.,
40-acre
spacing, and is often established by regulatory agencies.
"Unit."
The joining of all or substantially all
    interests in a reservoir or field, rather than a single tract,
    to provide for development and operation without regard to
    separate property interests. Also, the area covered by a
    unitization agreement.
"Wellbore."
The hole drilled by the bit that is
    equipped for oil or gas production on a completed well. Also
    called well or borehole.
"Working interest."
The right granted to the
    lessee of a property to explore for and to produce and own oil,
    gas, or other minerals. The working interest owners bear the
    exploration, development, and operating costs on either a cash,
    penalty, or carried basis.
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Table of Contents
Part II
INFORMATION
    NOT REQUIRED IN PROSPECTUS
ITEM 13.
Other
    Expenses of Issuance and Distribution
The following table sets forth an itemized statement of the
    amounts of all expenses (excluding underwriting discounts and
    commissions) payable by us in connection with the registration
    of the common stock offered hereby. With the exception of the
    Registration Fee, FINRA Filing Fee and New York Stock Exchange
    listing fee), the amounts set forth below are estimates. The
    selling stockholder will not bear any portion of such expenses.
SEC Registration Fee
$
24,955
FINRA Filing Fee
35,500
New York Stock Exchange listing fee
Accountants' fees and expenses
Legal fees and expenses
Printing and engraving expenses
Transfer agent and registrar fees
Miscellaneous
Total
$
ITEM 14.
Indemnification
    of Directors and Officers
Our certificate of incorporation provides that a director will
    not be liable to the corporation or its stockholders for
    monetary damages for breach of fiduciary duty as a director,
    except for liability (1) for any breach of the
    director's duty of loyalty to the corporation or its
    stockholders, (2) for acts or omissions not in good faith
    or which involved intentional misconduct or a knowing violation
    of the law, (3) under section 174 of the DGCL for
    unlawful payment of dividends or improper redemption of stock or
    (4) for any transaction from which the director derived an
    improper personal benefit. In addition, if the DGCL is amended
    to authorize the further elimination or limitation of the
    liability of directors, then the liability of a director of the
    corporation, in addition to the limitation on personal liability
    provided for in our certificate of incorporation, will be
    limited to the fullest extent permitted by the amended DGCL. Our
    bylaws provide that the corporation will indemnify, and advance
    expenses to, any officer or director to the fullest extent
    authorized by the DGCL.
Section 145 of the DGCL provides that a corporation may
    indemnify directors and officers as well as other employees and
    individuals against expenses, including attorneys' fees,
    judgments, fines and amounts paid in settlement in connection
    with specified actions, suits and proceedings whether civil,
    criminal, administrative, or investigative, other than a
    derivative action by or in the right of the corporation, if they
    acted in good faith and in a manner they reasonably believed to
    be in or not opposed to the best interests of the corporation
    and, with respect to any criminal action or proceeding, had no
    reasonable cause to believe their conduct was unlawful. A
    similar standard is applicable in the case of derivative
    actions, except that indemnification extends only to expenses,
    including attorneys' fees, incurred in connection with the
    defense or settlement of such action and the statute requires
    court approval before there can be any indemnification where the
    person seeking indemnification has been found liable to the
    corporation. The statute provides that it is not exclusive of
    other indemnification that may be granted by a
    corporation's certificate of incorporation, bylaws,
    disinterested director vote, stockholder vote, agreement or
    otherwise.
Our certificate of incorporation also contains indemnification
    rights for our directors and our officers. Specifically, our
    certificate of incorporation provides that we shall indemnify
    our officers and directors to the fullest extent authorized by
    the DGCL. Further, we may maintain insurance on behalf of our
    officers and directors against expense, liability or loss
    asserted incurred by them in their capacities as officers and
    directors.
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We have obtained directors' and officers' insurance to
    cover our directors, officers and some of our employees for
    certain liabilities.
We will enter into written indemnification agreements with our
    directors and executive officers. Under these proposed
    agreements, if an officer or director makes a claim of
    indemnification to us, either a majority of the independent
    directors or independent legal counsel selected by the
    independent directors must review the relevant facts and make a
    determination whether the officer or director has met the
    standards of conduct under Delaware law that would permit (under
    Delaware law) and require (under the indemnification agreement)
    us to indemnify the officer or director.
ITEM 15.
Recent
    Sales of Unregistered Securities
In connection with its formation in February 2010, Oasis
    Petroleum Inc. issued 1,000 shares of its common stock to
    Oasis Petroleum LLC in exchange for consideration of $10.00. The
    issuance of shares did not involve any underwriters or a public
    offering, and we believe that such issuance was exempt from the
    registration requirements pursuant to Section 4(2) of the
    Securities Act of 1933, as amended (the "Securities
    Act").
During the past three years, Oasis Petroleum LLC has issued
    additional membership interests in connection with capital
    contributions from its members, which consist of funds
    affiliated with EnCap Investments, L.P. ("EnCap");
    Oasis Petroleum Management LLC, which is controlled by members
    of management of Oasis Petroleum Inc.; and other private
    investors. Capital contributions were $104.6 million,
    $80.5 million and $49.9 million for the years ended
    December 31, 2009 and 2008 and the period ended
    December 31, 2007, respectively. None of these transactions
    involved any underwriters or any public offerings, and we
    believe that each of these transactions was exempt from the
    registration requirements pursuant to Section 4(2) of the
    Securities Act.
ITEM 16.
Exhibits
    and Financial Statement Schedules
(a) Exhibits
Exhibit
Number
Description
*1
.1
Form of Underwriting Agreement
*2
.1
Plan of Merger between Oasis Merger LLC and Oasis Petroleum LLC
*2
.2
Form of Contribution Agreement between OAS Holding Company LLC
    and Oasis Petroleum International LLC
*3
.1
Amended and Restated Certificate of Incorporation of Oasis
    Petroleum Inc.
*3
.2
Amended and Restated Bylaws of Oasis Petroleum Inc.
*4
.1
Form of Common Stock Certificate
*5
.1
Opinion of Vinson & Elkins L.L.P. as to the legality
    of the securities being registered
10
.1
Amended and Restated Credit Agreement, dated as of
    February 26, 2010, among Oasis Petroleum LLC, Oasis
    Petroleum North America LLC, BNP Paribas and the lenders party
    thereto.
*10
.2
Employment Agreement between Oasis Petroleum Inc. and
    Thomas B. Nusz
*10
.3
Employment Agreement between Oasis Petroleum Inc. and
    Taylor L. Reid
*10
.4
Registration Rights Agreement among Oasis Petroleum Inc. and OAS
    Holding Company LLC
*10
.5
Long-Term Incentive Plan of Oasis Petroleum Inc.
*10
.6
Form of Indemnification Agreement between Oasis Petroleum Inc.
    and each of the directors thereof
*21
.1
List of Subsidiaries of Oasis Petroleum Inc.
23
.1
Consent of PricewaterhouseCoopers LLP
23
.2
Consent of W.D. Von Gonten & Co.
23
.3
Consent of DeGolyer and MacNaughton
*23
.4
Consent of Vinson & Elkins L.L.P. (included as part of
    Exhibit 5.1 hereto)
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Table of Contents
Exhibit
Number
Description
24
.1
Power of Attorney (included on the signature page of this
    registration statement)
99
.1
Report of W.D. Von Gonten & Co. for reserves as of
    December 31, 2007
99
.2
Report of W.D. Von Gonten & Co. for reserves as of
    December 31, 2008
99
.3
Report of DeGolyer and MacNaughton for reserves as of
    December 31, 2009
*
To be filed by amendment.
ITEM 17.
Undertakings
The undersigned registrant hereby undertakes to provide to the
    underwriters at the closing specified in the underwriting
    agreement certificates in such denominations and registered in
    such names as required by the underwriters to permit prompt
    delivery to each purchaser.
Insofar as indemnification for liabilities arising under the
    Securities Act may be permitted to directors, officers and
    controlling persons of the registrant pursuant to the foregoing
    provisions, or otherwise, the registrant has been advised that
    in the opinion of the Securities and Exchange Commission such
    indemnification is against public policy as expressed in the
    Securities Act and is, therefore, unenforceable. In the event
    that a claim for indemnification against such liabilities (other
    than the payment by the registrant of expenses incurred or paid
    by a director, officer or controlling person of the registrant
    in the successful defense of any action, suit or proceeding) is
    asserted by such director, officer or controlling person in
    connection with the securities being registered, the registrant
    will, unless in the opinion of its counsel the matter has been
    settled by controlling precedent, submit to a court of
    appropriate jurisdiction the question whether such
    indemnification by it is against public policy as expressed in
    the Securities Act and will be governed by the final
    adjudication of such issue.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
    Securities Act, the information omitted from the form of
    prospectus filed as part of this registration statement in
    reliance upon Rule 430A and contained in a form of
    prospectus filed by the registrant pursuant to
    Rule 424(b)(1) or (4) or 497(h) under the Securities
    Act shall be deemed to be part of this registration statement as
    of the time it was declared effective.
(2) For the purpose of determining any liability under the
    Securities Act, each post-effective amendment that contains a
    form of prospectus shall be deemed to be a new registration
    statement relating to the securities offered therein, and the
    offering of such securities at that time shall be deemed to be
    the initial bona fide offering thereof.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
    registrant has duly caused this registration statement to be
    signed on its behalf by the undersigned, thereunto duly
    authorized in the City of Houston, State of Texas, on
    March 4, 2010.
OASIS PETROLEUM INC.
By:
/s/  Thomas
    B. Nusz
Thomas B. Nusz
Chairman, President and Chief Executive Officer
Each person whose signature appears below appoints Thomas B.
    Nusz and Taylor L. Reid, and each of them, any of whom may act
    without the joinder of the other, as his true and lawful
    attorneys-in-fact and agents, with full power of substitution
    and resubstitution, for him and in his name, place and stead, in
    any and all capacities, to sign any and all amendments
    (including post-effective amendments) to this registration
    statement and any registration statement (including any
    amendment thereto) for this offering that is to be effective
    upon filing pursuant to Rule 462(b) under the Securities
    Act of 1933, as amended, and to file the same, with all exhibits
    thereto, and all other documents in connection therewith, with
    the Securities and Exchange Commission, granting unto said
    attorneys-in-fact and agents full power and authority to do and
    perform each and every act and thing requisite and necessary to
    be done, as fully to all intents and purposes as he might or
    would do in person, hereby ratifying and confirming all that
    said attorneys-in-fact and agents or any of them or their or his
    substitute or substitutes, may lawfully do or cause to be done
    by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
    registration statement has been signed by the following persons
    in the capacities and on the dates indicated.
Signature
Title
Date
/s/  Thomas
    B. Nusz
Thomas
    B. Nusz
Chairman, President and Chief
Executive Officer
(Principal Executive Officer)
March 4, 2010
/s/  Taylor
    L. Reid
Taylor
    L. Reid
Director, Executive Vice President and Chief Operating Officer
March 4, 2010
/s/  Roy
    W. Mace
Roy
    W. Mace
Senior Vice President, Chief
Accounting Officer and Corporate Secretary
(Principal Financial Officer and
Principal Accounting Officer)
March 4, 2010
/s/  Douglas
    E. Swanson, Jr.
Douglas
    E. Swanson, Jr.
Director
March 4, 2010
/s/  Robert
    L. Zorich
Robert
    L. Zorich
Director
March 4, 2010
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INDEX TO
    EXHIBITS
Exhibit
Number
Description
*1
.1
Form of Underwriting Agreement
*2
.1
Plan of Merger between Oasis Merger LLC and Oasis Petroleum LLC
*2
.2
Form of Contribution Agreement between OAS Holding Company LLC
    and Oasis Petroleum International LLC
*3
.1
Amended and Restated Certificate of Incorporation of Oasis
    Petroleum Inc.
*3
.2
Amended and Restated Bylaws of Oasis Petroleum Inc.
*4
.1
Form of Common Stock Certificate
*5
.1
Opinion of Vinson & Elkins L.L.P. as to the legality
    of the securities being registered
10
.1
Amended and Restated Credit Agreement, dated as of
    February 26, 2010, among Oasis Petroleum LLC, Oasis
    Petroleum North America LLC, BNP Paribas and the lenders party
    thereto.
*10
.2
Employment Agreement between Oasis Petroleum Inc. and
    Thomas B. Nusz
*10
.3
Employment Agreement between Oasis Petroleum Inc. and
    Taylor L. Reid
*10
.4
Registration Rights Agreement among Oasis Petroleum Inc. and OAS
    Holding Company LLC
*10
.5
Long-Term Incentive Plan of Oasis Petroleum Inc.
*10
.6
Form of Indemnification Agreement between Oasis Petroleum Inc.
    and each of the directors thereof
*21
.1
List of Subsidiaries of Oasis Petroleum Inc.
23
.1
Consent of PricewaterhouseCoopers LLP
23
.2
Consent of W.D. Von Gonten & Co.
23
.3
Consent of DeGolyer and MacNaughton
*23
.4
Consent of Vinson & Elkins L.L.P. (included as part of
    Exhibit 5.1 hereto)
24
.1
Power of Attorney (included on the signature page of this
    registration statement)
99
.1
Report of W.D. Von Gonten & Co. for reserves as of
    December 31, 2007
99
.2
Report of W.D. Von Gonten & Co. for reserves as of
    December 31, 2008
99
.3
Report of DeGolyer and MacNaughton for reserves as of
    December 31, 2009
*
To be filed by amendment.