Landmark Reviews Falcon's Texas Prospect

Falcon Natural Gas Corp. has received an independent evaluation of its East Bob West Prospect in Southern Texas from Landmark Graphics Corporation.

The report issued in June 2004 confirms the considerable potential of the prospect, with potential recoverable reserves of up to 528 billion cubic feet.

The scope of the report was to re-work the available seismic, geological and petrophysical data along with a review of the analogous production from the adjacent Bob West and Lopeno fields. The conclusion of this work is that the prospect is located in a sand rich environment within the growth fault trend and fault system that traps at the major producing fields of Bob West and Lopeno.

With this information it was determined that the most probable recoverable reserves for the structure would be 106 billion cubic feet with a 10% probability of 528 BCF of Natural Gas value should all reservoir parameters be favorable. This range covers the reserves determined by the previous independent study work performed by Don W. Frazier, Inc. which gave an estimate of 200 BCF.

Landmark geophysicists, weighing all the risk parameters, gave a probability of 1 in 5 of a successful well, a probability that is considered very good in the industry for an exploration well.

Landmark assessed the cost of drilling and obtaining initial reservoir data to prove the presence of gas to be $3.94 million and an extensive program of testing and stimulation could run to $6.2 million. These figures are in line with Falcon's original estimates.

"We are very pleased with the Landmark report which confirms the potential that had been identified previously for the prospect. The range of possible reserves is very exciting and is in line with the values previously determined by other professionals. We look forward to drilling our first well this year and hope to prove up some significant reserves," said Alan Aitchison, Falcon's President & CEO.

Landmark Warranty

The report was based on the available data and Landmark cannot and does not in anyway guarantee results. All interpretation and all recommendations or reservoir descriptions based on such interpretations are opinions based on inferences, from measurements, empirical relationships and assumptions. These inferences and assumptions are not fallible and may differ with respect to other competent specialists. Landmark cannot and does not warranty the accuracy, correctness or completeness of the report. Falcon assumes the full responsibility for any and all decisions taken as a result of the report commissioned from Landmark.

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