Lario

MISSISSIPPI HORIZONTAL OIL / GAS PLAY

Kingman County, Kansas

Opportunity to acquire a highly prospective operated leasehold position with long-term resource potential in the rapidly developing Mississippian Lime play in South Central Kansas.

• Located in the Sedgwick Basin in a historically producing area just north of and immediately adjacent to the very active Mississippian Lime leasing, well permitting and horizontal drilling activity
• Since January, 2012 over 50 new horizontal drilling permits have been issued in Harper County, Kansas immediately south of the block
• Drill depths of 3,800-4,000 feet with an average of 200 feet of Mississippian target present in well-documented nearby show wells
• Acreage directly offsets a northeast-southwest trend of vertical Mississippian Osage production that includes two of the largest oil and gas fields in Kansas, the Broadway Field complex (6 MMBO and 12.5 BCFG) and the Spivey Grabs Field (69.4 MMBO and 846 BCFG)

Land

• ~8,704 gross and net acres in consolidated acreage blocks
• 100% working interest / 81.25% delivered net revenue interest
• Lease expirations range from 2014-2016
• Majority of leases have 2-5 year extension options
• Leases cover all depths and do not contain any pugh clauses

Upside Potential

• Multiple prospective vertical targets in the Lansing-Kansas City, Misener, Viola and Simpson formations which all produce in the immediate vicinity