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      18 &amp;#8212; Business Segment Information&lt;/u&gt;&lt;/b&gt;&lt;/font&gt;

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      &lt;font style="FONT-FAMILY: Times New Roman, Times, serif; FONT-SIZE: 10pt"&gt;The

      Company determines and discloses its segments in accordance

      with ASC Topic 280, &amp;#8220;Segment Reporting&amp;#8221;

      (&amp;#8220;ASC Topic 280&amp;#8221;), which uses a

      &amp;#8220;management&amp;#8221; approach for determining segments.

      The management approach designates the internal organization

      that is used by management for making operating decisions and

      assessing performance as the source of the Company&amp;#8217;s

      reportable segments. ASC Topic 280 also requires disclosures

      about products or services, geographic areas, and major

      customers. The Company&amp;#8217;s management reporting structure

      provided for only one segment for the three and six months

      ended June 30, 2013 and 2012, respectively. Accordingly, no

      separate segment information is presented. In addition, the

      Company operates only in Peru and has only one customer for

      its oil production, the Peruvian national oil company,

      Petroperu. The majority of the Company&amp;#8217;s long-lived

      assets are located in Peru. Management does not consider its

      investment in Ecuador as a separate business segment.&lt;/font&gt;

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