Company Profile

We are a publicly traded limited liability company focused on the acquisition and development of mature long-lived natural gas and oil properties in the United States. Our properties are located in the southern portion of the Appalachian Basin in Kentucky and Tennessee, the Permian Basin in West Texas and New Mexico, and South Texas. 

We are treated as a partnership for federal income tax purposes.  As a result, our investors will receive a Schedule K-1 in the first quarter of each year which allocates items of gain, loss, and deductions to be included in the investors’ federal income tax return.  Primarily as a result of our active drilling program, the Company generates sufficient tax deductions to offset much of the income generated and so the distributions received by our investors’ are tax deferred.  Currently, the Company anticipates that at least 70% of the cash distributions paid to investors through 2011 will be tax deferred.  Please consult your tax advisor for additional information.

We were formed in October 2006 and effective January 5, 2007 our predecessor was separated in the Nami Restructuring Plan into our operating subsidiary and Vinland Energy Eastern, LLC ("Vinland"), an affiliate of Mr. Nami, who together with certain of his affiliates and related persons, is our largest unit holder. As part of the separation, we retained all of our predecessor's proved producing wells and associated reserves along with an approximate 40% working interest in approximately 95,000 gross undeveloped acres. Vinland owns the remaining approximate 60% working interest in this acreage, as well as all the working interest in depths above and 100 feet below our known producing horizons and is expected to act as the operator of our existing wells in Appalachia and all of the wells that we drill in this area. The separation was effected to facilitate our formation, as we are a company focused on lower risk production and development opportunities, while Vinland pursues higher capital intensive development and exploration opportunities.

In Appalachia, we owned working interests in 943 gross (825 net) productive wells at December 31, 2007. Our estimated proved reserves at December 31, 2007 were 67.1 Bcfe, of which approximately 97% were natural gas and 75% were classified as proved developed. Our average proved reserves-to-production ratio, or average reserve life, is approximately 16 years based on our proved reserves as of December 31, 2007 and our production for the year ended December 31, 2007.

On January 31, 2008, we completed an acquisition of producing oil and gas properties in West Texas and New Mexico from Apache Corporation. In this acquisition, we acquired both operated and non-operated working interests in a diverse group of fields in nine separate counties. In this area referred to as the Permian Basin, based on internal reserve engineering as of October 1, 2007, we acquired 4.4 MMboe of reserves, 84% of which are oil and which have a reserve to production profile of approximately 15 years. Approximately 90% of the reserves acquired are proved producing.

On July 28, 2008, we closed an acquisition of producing oil and gas properties in Webb County, Texas from an affiliate of the Lewis Energy Group (“Lewis”). This acquisition is composed of 91 producing wells and an approximate 45% working interest in 1,700 undeveloped acres. In this acquisition, we acquired 20 Bcfe of proved reserves, 65% of which are proved producing and 98% of which are natural gas. The reserves-to–production profile of these reserves is 18 years.  Lewis will operate all of the wells in this area and will execute the drilling program to develop the multi-year inventory of proved undeveloped locations.