(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

Certain Lenders will make an additional $25,000,000 in loans (the “Additional Loans”) available to the Company to be used in accordance with an approved budget but only if certain conditions are met.

The interest rate on all Loans under the DIP Credit Agreement will be increased by .50% per annum, and such interest will be paid in kind upon maturity or payment in full of the Loans. For Qualified Lenders under the DIP Credit Agreement who agree to extend Additional Loans in their respective pro rata amounts, the interest on their respective outstanding loans will increase 2.00% per annum, and such interest will be paid in kind upon maturity or payment in full of the Loans. Additionally, an exit fee of 1.00% per annum will be payable on all loans and commitments (other than the Additional Loans) of all Qualified Lenders who commit to provide at least their respective pro rata shares of the Additional Loans. For each Qualified Lender that agrees to provide an Additional Loan, the Company will also pay a closing fee equal to 2.00% per annum of the amount of such Lender’s commitment for an Additional Loan. The 4.25% unused commitment fee will also apply.

The DIP Credit Agreement provides that the Chief Restructuring Officer (the “CRO”) must approve all capital expenditures and investments over $1,000,000. Also, conditions are added that require (i) in the event of the termination, death or disability of the CRO, the Company file an application to retain a replacement CRO and seek an expedited hearing within 10 days of such termination, death or disability, and (ii) the Bankruptcy Court enter an order approving the retention within 30 days or such termination, death or disability, otherwise an event of default will occur.

The deletion of the Satisfactory APE Report for the funding of the Subsequent Clipper Project Amount (in the aggregate principal amount of $30,000,000) and the Final Clipper Project Amount (in the aggregate principal amount of $80,000,000).

The funding date of the Final DIP Budget Amount was advanced from December 15, 2012 to November 15, 2012, and the conditions to funding requiring the commercial operation of the Clipper Project and the three consecutive day production rate were deleted.

The funding of the Additional DIP Budget Amount in the aggregate principal amount of $30,000,000 (which was formerly called the Gomez #9 Project Amount), was advanced from February 13, 2013 to January 13, 2013, and the condition to funding requiring a satisfactory production volume test at the Clipper Project was revised to reduce the testing period from 60 days to 15 days.

The Company has an additional 15 days to enter into Commodity Arrangements satisfactory to the Agent and the Required Lenders.

If the Company does not deliver to the Agent and the Lenders a Satisfactory APE by October 31, 2012, or if by November 15, 2012 the conditions to the Final DIP Budget Availability Date have not been met, then the Company will be required to meet a new set of milestones, and funding under the DIP Budget will be limited only to the amounts allowing the Company to continue in operation, and to fund the Clipper expenditures. The milestones include, among other things, the preparation of a data room as early as 20 days after, and the filing of a sale motion with the Bankruptcy Court as early as 60 days after, non-compliance with the conditions above.

Exhibit

Exhibit Description

Albert L. Reese Jr.

Chief Financial Officer

Exhibit

Exhibit Description