1. SUCCEEDING WITH PRIVATE EQUITY

2. How Does Private Equity Help Your Team Succeed?

3. Assisting the management team in executing their business plan.

4. Overview Private equity provider responsibilities. Management team due diligence. My experiences with private equity. –Crow Creek Energy – day to day business. –Crow Creek Energy II – significant transaction. Lessons learned.

5. Your Private Equity Provider Should: Provide equity capital at a market rate. Serve as a force multiplier. Assist with banking contacts and documents. Provide expertise in hedging commodities and interest rates. Act as respected business reference with third parties.

6. Finding The Right Private Equity Provider Know the business style of potential private equity providers. Check references. Some teams want engineering and geological feed back. Some don’t. Some private equity providers like a lot of data and frequent contact. Some don’t. Private equity should have an alignment of interests with team.

7. Crow Creek Energy Tulsa based company. Formed October 2002. Patrick Hall, CFO. Mike Rollins, VP Engineering. David Hoffman, VP Land. M. Storm, President, CEO. NGP committed $15,000,000 equity. Management committed $1,000,000.

8. Business Model Mid-Continent Focus – Arkoma/Anadarko Basins. Acquisitions with upside potential, PUD’s and workovers. Acquire acreage and drill for resource plays. Low overhead, small staff. Seven office and two field employees. Leverage equity with debt.

9. Great reputation in industry. Several NGP portfolio companies in Tulsa for reference. Track record of profitable portfolio company sales. More acquisition oriented than drilling. Private Equity Provider – Natural Gas Partners

10. Properties Made four acquisitions in Oklahoma. Cash flow funded drilling. Developed resource plays that create multiple PUD’s for every well drilled. Acquired 22,000 acres and drilled 25 horizontal CBM wells in Arkoma Basin. Acquired 12,000 acres, drilled four wells, made Granite Wash Field discovery in Washita County. Exited with 42 BCFE, 6.5 MMCFED.

11. Exit Sold as a C Corp to Penn Virginia Oil & Gas 6/06 for $71.5MM. Took down $9.3MM in NGP equity. NGP ROI of 5:1. Management ROI of 13:1.

12. CCE II Formed CCEII October 2006 with NGP. Business model similar to first Company. Bias toward larger PDP acquisitions. NGP $25MM in equity. Management $3.75MM in equity. First deal – January 2007. Encana mid-continent properties acquisition for $9.5MM. Financed half equity, half debt from BOK.

13. Encore Transaction April 10 th Encore mid-continent package data room. Liked the properties, areas we knew well and had worked before. Deep Springer in Verden Field, 5.0-10.0 BCF per well 80 acre infill. Bromide and Big Four in Golden Trend 2.0 BCFD and 200mbo on 40 acre infill. Barnett Shale infill in Tarrant County, 2.5 to 3.5 BCF/well. Large non-op position throughout Anadarko and Arkoma. Deal size estimated at $275MM to $325MM.

14. We Have Issues Deposit more than our entire equity commitment. NGP remaining equity commitment $20MM. Need $170MM. Must assemble and syndicate a $250MM credit facility in six weeks. Complete enviro and land due diligence on 200 wells. Hedge 100% of production for two to three years before close. Must add technical and support staff, get new offices. Small start up. Seller might balk at our size. Presented to Board May 2 nd.

15. NGP Gets Flexible NGP raises their equity commitment to $170MM. Crow Creek bids $300MM for Encore. Negotiate in Ft. Worth with Encore. May 16 th signed PSA for a June 29 th close. Paid deposit of $30MM.

16. Need to secure remaining financing to close in six weeks. Want fully under written revolving facility. $30MM riding on it. Two days of bank meetings. Term sheets due May 29 th. Wachovia wins lead, BNP Paribas and Merrill Lynch take co lead roles. June 13 th syndication meeting in Houston. Eight other banks join in syndicate. 100% oversubscribed. Getting Busy

17. Pressure Builds Due diligence continues on 200 operated wells with value of $240MM. NGP runs hedging program through due diligence. CCE II spends $2.5MM pre-closing to buy puts. Hedge 100% production through 12/09. Bank group signs off on due diligence. Close June 29 th for $285MM after adjustments.

18. At closing Encore showed total proved 122 BCFE and 25 MMCFED. 12/31/07 total proved 156BCFE and 29MCFED. Three new wells on line last 60 days adding 7MMD and 400BOPD net. First six months

19. What’s ahead? 2008 drilling budget $80MM. Two to three operated rigs in Verden, Golden Trend, Barnett, and Woodford. Participate in non-op increased densities in Oklahoma. Will drill operated Woodford shale prospect in Southern OK. Bidding on other mid continent acquisitions.

20. Lessons Learned Private equity provider should add value in day to day business and transactions. Work together with management team to compete for and close transactions. Support management team in two critical areas.

21. Banking Former bankers at NGP speak the bankers language. Helped us negotiate the best term sheet for credit facility. Bank contacts narrowed group that could deliver term sheet needed. Prepared bank books while we focused on due diligence. Coordinated syndication meetings. Assisted in preparation and negotiation of bank documents.

22. Hedging Staff dedicated to understanding the gas markets and pricing. Trading every day in the market for various portfolio companies. Sound hedging strategies based on market analysis. Executed large number of trades with multiple counterparties quickly.

23. How Has NGP Helped Us Succeed? By doing the things we don’t do as well as they do, allowing our team to focus on doing what we do best.