Note

Supplemental Information Relating to Oil and Gas Producing Activities

(Unaudited)

The following supplemental unaudited oil and gas information is required by generally accepted accounting principles.

The tables on the following pages set forth pertinent data with respect to the Company's oil and gas properties, all of which are located within the continental United States.

CAPITALIZED COSTS RELATING TO OIL AND GAS
PRODUCING ACTIVITIES

	Years ended December 31,
	2016		2015

Proved oil and gas properties	$	181,447,571	$	181,293,110

Pipeline and support equipment		682,135		631,757

Gross capitalized costs		182,129,706		181,924,867

Accumulated depreciation, depletion, amortization and write down		172,885,338		168,088,105

Net capitalized costs	$	9,244,368	$	13,836,762

COSTS INCURRED IN OIL AND GAS PRODUCING ACTIVITIES

	Years ended December 31,
	2016		2015

Property acquisition costs	$	20,363	$	29,037
Development costs		136,274		72,047

The Company had no purchases of producing oil and gas properties in

2016

2015.

RESULTS OF OPERATIONS FOR OIL AND
GAS PRODUCING ACTIVITIES

	Years ended December 31,
	2016			2015

Crude oil and natural gas sales	$	3,439,081		$	5,728,206
Production costs		(2,164,682	)		(2,734,789	)
Depreciation, depletion and amortization		(4,753,321	)		(12,363,647	)
Accretion expense		(393,535	)		(583,792	)
Write down/impairment and abandonment of crude oil and natural gas properties		(88,329	)		(9,575,275	)

Results of operations before income tax expense (benefit)		(3,960,786	)		(19,529,297	)

Income tax expense (benefit)		(20,000	)		11,000

Results of operations for oil and gas producing activities (excluding corporate overhead and financing costs)	$	(3,940,786	)	$	(19,540,297	)

Income tax expense was computed using statutory tax rates and reflects permanent differences that are reflected in the Company's consolidated income tax expense for the year.

ESTIMATED QUANTITIES OF PROVED OIL AND GAS RESERVES

	Oil			Gas
	(BBLS)			(MCF)

Balance, January 1, 2015		511,000			23,724,000
Extensions, discoveries and other additions		2,000			5,000
Production		(44,000	)		(1,616,000	)
Revision of previous estimates		(192,000	)		(14,122,000	)

Balance, December 31, 2015		277,000			7,991,000
Extensions, discoveries and other additions		5,000			13,000
Production		(34,000	)		(1,157,000	)
Revision of previous estimates		(4,000	)		(1,567,000	)

Balance, December 31, 2016		244,000			5,280,000

PROVED DEVELOPED RESERVES:

December 31, 2014		511,000			23,724,000
December 31, 2015		277,000			7,991,000
December 31, 2016		244,000			5,280,000

The Company has not determined proved reserves associated with its proved and other undeveloped properties, including its deep property interests. At

December

31,

2016

and

2015,

the Company had

and

net proved undeveloped acres, respectively. The net carrying cost of the proved undeveloped acreage that is included in proved properties amounted to approximately

$36,200

and

$35,700

December

31,

2016

and

2015,

respectively.

STANDARDIZED MEASURE OF DISCOUNTED FUTURE
NET CASH FLOWS


	December 31,
	2016			2015
	(Thousands of Dollars)
Future cash inflows from sales of oil and gas	$	17,014		$	23,821
Future production and development costs		(10,853	)		(15,446	)
Future asset retirement obligations, net of salvage		(16,451	)		(16,443	)
Future income tax expense		(95	)		(144	)

Future net cash flows		(10,385	)		(8,212	)
Effect of discounting future net cash flows at 10% per annum		461			1

Standardized measure of discounted future net cash flows	$	(9,924	)	$	(8,211	)

CHANGES IN THE STANDARDIZED MEASURE OF
DISCOUNTED FUTURE NET CASH FLOWS


	Years Ended December 31,
	2016			2015
	(Thousands of Dollars)

Balance, beginning of year	$	(8,211	)	$	28,157
Extensions, discoveries and other additions		85			30
Revision of quantity estimates		(184	)		(2,562	)
Sales of crude oil and natural gas, net of production costs		(1,274	)		(2,993	)
Net change in income taxes		32			573
Net changes in prices and production costs		(1,080	)		(31,254	)
Accretion of discount		(821	)		2,816
Other		1,529			(2,978	)

Balance, end of year	$	(9,924	)	$	(8,211	)

There are numerous uncertainties inherent in estimating quantities of proved reserves and in projecting future rates of production and timing of development expenditures, including many factors beyond the control of the Company. The estimated future cash flows are determined based on crude oil and natural gas pricing parameters established by generally accepted accounting principles, adjusted for contract terms within contract periods, estimated production of proved crude oil and natural gas reserves, estimated future production and development costs of reserves and future retirement obligations (net of salvage), based on current economic conditions, and the estimated future income tax expense, based on year-end statutory tax rates (with consideration of future tax rates already legislated) to be incurred on pretax net cash flows less the tax basis of the properties involved. Such cash flows are then discounted using a

10%

rate.

The methodology and assumptions used in calculating the standardized measure are those required by generally accepted accounting principles and United States Securities and Exchange Commission reporting requirements. It is not intended to be representative of the fair market value of the Company's proved reserves. The valuation of revenues and costs does not necessarily reflect the amounts to be received or expended by the Company. In addition to the valuations used, numerous other factors are considered in evaluating known and prospective oil and gas reserves.

Average adjusted natural gas prices used in the estimation of proved reserves were

$1.41

and

$1.37

per MCF at

December

31,

2016

and

2015,

respectively, and the average adjusted crude oil prices used in the estimation of proved reserves were

$39.33

and

$46.40

per BBL at

December

31,

2016

and

2015,

respectively.