Introduction

The 3Legs Resources Group was established in early 2007 to focus on the exploration and development of unconventional oil and gas resources with a focus on shale gas in Europe. As a first mover in Poland, we have six exploration and prospection concessions covering approximately 4,387 sq. km (1,084,000 acres) in the onshore Baltic Basin region of Northern Poland.

In August 2009, we agreed terms with ConocoPhillips under which they committed to fund the costs of an exploration programme in the Baltic concessions comprising of 3D seismic surveys and up to three wells, in return for a right to acquire a 70% interest in those concessions.

Our independent technical advisor, Netherland, Sewell & Associates Inc has ascribed a gross best estimate Original Gas in Place OGIP of 169,585 BCF to these Baltic concessions. Taking into account ConocoPhillips’ interest, the net best estimate OGIP ascribed to our Group is 50,876 BCF.

We will be drilling two further appraisal wells in our western Baltic Concessions during 2011, both of which are planned to include horizontal drilling and multi-stage frac completions. Our work on these two wells will aim to demonstrate commercial flow rates, as a precursor to a pilot development programme.

In addition to the Baltic concessions, the 3Legs Resources Group holds onshore exploration licences over a further 2,517 sq. km (622,000 acres) near Krakow in southern Poland and two further licences totalling approximately 2,574 sq. km (636,000 acres) in Baden-Württemberg in south-west Germany.

Two further licence applications have been submitted in south-west and south-east France in respect of areas of approximately 5,710 sq. km (1,411,000 acres) and 5,801 sq. km (1,433,000 acres).

The Group’s management team has a proven track record in the selection, appraisal and development of oil and gas resources. The combined experience of the Group’s core team, along with the support of ConocoPhillips in Baltic concessions, puts us in a strong position to develop our existing asset base and to seek, acquire and develop additional oil and gas opportunities in Europe.