Geology of Diamond Springs Prospect

An independent geological report was conducted by C.P Abrassart and includes the following information.

Stratigraphic pinch-outs of the sands of the Cretaceous Frontier, Dakota and Lakota formations; and, Jurassic Morrison and Sundance formations occur on the north plunge of an anticlinal nosing (Diamond Springs structure), which was determined by aerial photogeologic, surface and subsurface mapping; and, substantiated by seismic shooting. Two separate geologic prospects are present on this nosing—the North Diamond Springs and the Northwest Diamond Springs Prospects.

A separate nosing, to the west of, and separated from the Diamond Springs nosing by a syncline, also has prospective Dakota and Lakota sands pinch-out traps.

Frontier Sands

The sands of this formation pinch-out on the extreme north plunge of the Diamond Springs anticline with the possibility of a stratigraphic trap. The possibility of a fault trap further enhances the possibility of a viable oil and/or gas trap in the four Frontier sands of the Frontier formation.

Lakota and Dakota Sand

The Dakota sand consists of fine-grained sandstone. The Lakota sand consists of conglomerate sandstone, fine-medium grained. At least 40 feet of micro-log separation is suggested.

Trapping Mechanism

Potential oil and/or gas stratigraphic traps, with the structural assist provided by the Diamond Springs anticlinal nosing; and, the pinch-out of the Frontier, Dakota and Lakota sands on this nosing are possible in the Northwest, North and West Diamond Spring Prospects.

In order to provide a trap for the oil and/or gas, a cap rock must be present, overlapping these pinch-outs at the Tertiary-Cretaceous unconformity. Such a cap rock is provided by the Tertiary Wind River formation. This formation should provide an adequate cap rock.

The Northwest, North and West Diamond Springs Prospects may have up to 75 possible drill sites based on 40 acre spacing with significant possible oil and/or gas reserves. The shallow drilling depths and reasonable drilling costs suggest favorable economic rates of return.