In April 2005, the Company acquired a 10% working interest in the Stewart property, a middle Yegua prospect in Goliad County having three or four high quality locations on a 272 acre lease.  This prospect is situated within the Jobar field, which produces from the middle Yegua formation from 5,200 feet to 5,400 feet in a normal pressured regime. The prospect was initially defined by five 2D seismic lines.  3D seismic data was recently purchased and interpreted by the syndicate has identified several Yegua prospects.  An initial well will test the most prospective target in November 2005.

In 1998, Edge Petroleum discovered the Jobar Field in the Yegua formation using amplitude analysis initially of 2D seismic lines followed by 3D seismic. The cumulative production to date from this field is 5.314 BCF from 7 wells with an average production per well to date of approximately 760 mmcf.

The middle Yegua sands appear to have been deposited as fluvial bars trending in a general ENE to WSW direction modified by small displacement down to basin faults.

A strong amplitude anomaly is associated with the neighboring Edge V Albrecht #1 well which was drilled at a shot point on the FB-88-1 line running across the Stewart Prospect. The well was perforated from 5,371 feet to 5,393 feet covering 16 feet of net good porosity and produced a cumulative 614 mmcf of gas plus condensate.  3D analysis reveals that the well produced on the margins of the anomaly consisting of a sand bar covering 60 to 65 acres.

The initial test well will test what is interpreted as a similar sand bar of approximately 110 acres. Further potential locations are indicated on three other bars within the prospect as defined by the 3D program.

The other wells in the Jobar Field have had average initial production of 1.5 Mmcf of gas per day plus approximately 5 bbls of condensate per day.  Generally, these wells have produced from 1.5 to 1.6 Mmcf per day with an ultimate life of about 5 years.  Gas in the area from the Yegua has a btu of 1,100 btu/mcf resulting in a premium of approximately 10% on the price paid for the gas.