With the Quicksilver Acquisition, we believe that we are the largest gas producer in Michigan, and one of the top producers in the Antrim Shale. As of December 31, 2007, our Michigan operations comprised approximately 61 percent of our estimated proved reserves. Our average net production from the November 1, 2007 acquisition date to December 31, 2007 was approximately 11.0 MBoe per day (or 66 MMcfe). Integrated midstream assets acquired from Quicksilver enhance the value of our Michigan properties as gas is sold at MichCon prices, and we have no significant reliance on third party transportation. We have interests in 3,017 productive wells in Michigan.


Antrim Shale

The Antrim Shale underlies a large percentage of our Michigan acreage; wells tend to produce relatively predictable amounts of natural gas in this reservoir. Over 9,000 wells have been drilled with greater than 95 percent drilling success over its history. On average, Antrim Shale wells have a proved reserve life of more than 19 years. Since reserve quantities and production levels over a large number of wells are fairly predictable, maximizing per well recoveries and minimizing per unit production costs through a sizeable well-engineered drilling program are the keys to profitable Antrim development. Significant growth opportunities include infill drilling and recompletions, horizontal drilling and bolt-on acquisitions. We have on average a 45 percent working interest and our estimated proved reserves attributable to our Antrim Shale interests as of December 31, 2007 were 74.1 MMBoe (or 444.6 MMcfe), of which 92 percent was proved developed.


Non-Antrim Fields

Our non-Antrim interests are located in several reservoirs including the Prairie du Chien (“PRDC”), Richfield (“RCFD”), Detroit River Zone III (“DRRV”) and Niagaran (“NGRN”) pinnacle reefs. Our estimated proved reserves attributable to our non-Antrim interests as of December 31, 2007 were 12.6 MMBoe (or 75.6 MMcfe). We own on average a 66 percent working interest in our non-Antrim Michigan fields.

The PRDC will produce dry gas, gas and condensate or oil with associated gas, depending upon the area and the particular zone. Our PRDC production is well established, and there are numerous proved non-producing zones in existing well bores that provide recompletion opportunities, allowing us to maintain or, in some cases, increase production from our PRDC wells as currently producing reservoirs deplete.

The vast majority of our Richfield/Detroit River wells are located in Kalkaska and Crawford counties in the Garfield and Beaver Creek fields. Potential exploitation of the Garfield RCFD/DRRV reservoirs either by secondary waterflood and/or improved oil recovery with CO2 injection is under evaluation; however, because this concept has not been proved, there are no recorded reserves related to these techniques. Production from the Beaver Creek RCFD/DRRV reservoirs consists of oil with associated natural gas.

Our Niagaran wells produce from numerous Silurian-age Niagaran pinnacle reefs located in the northern part of the lower peninsula of Michigan. Depending upon the location of the specific reef in the pinnacle reef belt of the northern shelf area, the Niagaran reefs will produce dry gas, gas and condensate or oil with associated gas.

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