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1 st QUARTER, 2015 FEATURED INSIDE Certainty of Close: When the sale is over, it's over A&D Markets Remain Open and Liquid CONTINUOUS ONLINE AUCTION RAPID-CYCLE SEALED BID SALES NEGOTIATED SALES STATE LEASE SALES The Marketplace Discover

EnergyNet Quarterly Q1 2015

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Page 1: EnergyNet Quarterly Q1 2015

1st QUARTER, 2015

FEATURED INSIDE

Certainty of Close: When the sale is over, it's over

A&D Markets Remain Open and Liquid

CONTINUOUS ONLINE AUCTION • RAPID-CYCLE SEALED BID SALES • NEGOTIATED SALES • STATE LEASE SALES

The MarketplaceDiscover

Page 2: EnergyNet Quarterly Q1 2015

Certainty of close is many times just as important a factor as getting the highest value for your deal.

At EnergyNet, we try to accomplish both consistently. We work to get the highest value by preparing a complete and comprehensive data

package and then exposing the opportunity to our network of over 18,000 qualified, registered bidders and 54,000 Pinpoint contacts. Maximizing exposure to the marketplace creates competition and thus achieves the highest value for your assets.

It’s no small feat to close between 1,500 and 2,000 transactions a year. In order to ensure that the deals close time and time again, EnergyNet creates a framework and platform that is fair for both buyer and seller with a clear set of rules for how the sales cycle works from start to finish.

To say that the oil and gas marketplace is filled with all kinds of characters is an understatement. Buyers and sellers are accustomed to doing deals in a variety of different ways. When deal customs deviate widely, it can be very difficult to get to the finish line; even if both agree on price. EnergyNet works to standardize how a given deal will work. We transparently define what is expected of the seller and we clearly define the rules of engagement that bidders and buyers are expected to abide. All of the rules of the game are presented and agreed upon before the game begins. This is a unique and crucial aspect behind how EnergyNet conducts successful sealed bid, auction and private transactions.

Have you ever spent a long time – longer than expected – negotiating a Purchase and Sale Agreement (PSA) when you supposedly already

have a deal with the buyer/seller? Yes. Everyone has. Now the buyer is trying to claw back on the price or the seller is demanding unreasonable terms. You thought you already had a deal, but now it might not close because of hang-ups with the PSA. You wish you would have been on the same page from the beginning.

Imagine a situation where buyers and sellers have already agreed to the terms of a fair PSA before there are any assets for up for sale. All parties to the transaction have pre-agreed to the rules of engagement. Now, when properties are offered for sale and bidders compete, the deals close quickly, because the only variable in the deal is the price. That is what EnergyNet does. That simple uniformity is the crux of the EnergyNet business model. That’s what EnergyNet has been doing for over 15 years. That’s why our platform consistently works, and is simple for both the Buyer and Seller.

The EnergyNet Auction and Rapid Cycle Sealed Bid Sale both use pre-established Buyer/Seller Agreements (PSA’s) – when the sale is over, it's over! That's the secret that allows EnergyNet to close so many transactions each year. We believe it is better for the seller to determine any deviations from the standard Buyer and Seller Agreement at the time the offer is submitted. The EnergyNet model is flexible enough that we can accommodate most buyer and seller requests, but we do so with full disclosure and permission from the participating parties upfront, as opposed to the tail end of a transaction. No surprises!

Achieving a high price and getting the deal closed is a valuable combination in today’s acquisition and divestiture market. In the low commodity price market of Q1 2015, EnergyNet serves as a solution to exploration and production companies’ problems. Our fast 35 day sales cycle, access to over 18,000 cash buyers, and platform and buyer/seller framework

Certainty of Close:When the sale is over, it's overChris Atherton, President - EnergyNet.com, Inc.

to ensure deals close helps companies create liquidity by divesting non-core assets. EnergyNet and our team of professionals are interacting with active buyers on a daily and weekly basis because we have a steady flow of properties coming to the market and successfully closing. This is unique compared to firms that hold an infrequent live auction or regional advisors that only market eight to ten packages a year.

EnergyNet has the pulse of the market. In 2014, we sold assets for 395 companies for an aggregate value of $283MM. In the first few weeks of 2015, we have already closed a large number of divestments and have a full inventory of assets for buyers to evaluate through the first quarter. The A&D market is not frozen, and the bid-ask spread between buyer and seller is not too wide to overcome. For the most part, the sellers in the market have their eyes wide-open and do not have unrealistic expectations.

EnergyNet continues to gain market share in the oil and gas property auction market space, but our sellers are also experiencing great results with our sealed bid platform. The EnergyNet sealed bid platform gives sellers more flexibility in the marketing and due diligence process and it works especially well for assets that are operationally or contractually complex or for

assets with significant upside where multiple buyers may differ greatly on value. EnergyNet closed multiple individual deals in 2014 valued greater than $20MM signaling the market’s recognition that our sales process, platform and access to the marketplace of buyers is viable and works.

In simple terms, EnergyNet strives to achieve the highest prices while providing a timely sale for oil and gas properties by exposing them to the widest

possible national audience of accredited buyers. EnergyNet has created a platform and marketing method that works consistently.

The EnergyNet MarketplaceMore than 18,000 active, sophisticated, registered and accredited buyers from across the nation.

The A&D market is not frozen,

and the bid-ask spread between buyer and seller

is not too wide to overcome.

Page 3: EnergyNet Quarterly Q1 2015

EnergyNet wrapped up 2014 as the most successful year in the company’s fifteen year history with over $283 million in property sales, up more than 40% from the previous year, and marking the second consecutive year of record sales. We opened with a strong first quarter and continued to build momentum throughout the year.

395 unique companies sold assets with EnergyNet in 2014, including Devon Energy Corp, Encana Corp, Chevron Corp, XTO Energy, Royal Dutch Shell Plc, EnerVest Ltd., Bill Barrett Corp., Halcon Resources, Magnum Hunter Resources, Continental Resources and Newfield Exploration Co.

In 2014, EnergyNet successfully closed transactions on 123 business days, ensuring our sellers a liquid and continuous marketplace to exit their holdings while our buyers experienced a steady stream of acquisition opportunities for review.

While the private industry segment of EnergyNet’s business grew in 2014, the

Government Lease Sale division made great strides as well, successfully closing hundreds of state lease sales for Colorado, North Dakota and Utah.

“EnergyNet closed multiple individual deals in 2014 valued greater than $20MM signaling the market’s recognition that our sales process, platform and access to the marketplace of buyers is viable and works,” says Chris Atherton, EnergyNet’s President. “We provide oil and gas companies a liquid market to dispose of assets, and in 2015 that will prove to be a very valuable service. We are currently marketing non-core assets for Chevron, Devon, Bank of America and many others. The markets remain open and liquid in these volatile times.”

EnergyNet facilitates the sale of producing oil and gas fields, working interests (operated and non-operated), overrides, royalties, mineral interests, and non-producing leasehold in every onshore U.S. basin. Sellers and buyers take advantage of EnergyNet’s Rapid Cycle Sealed Bid Sales Process as well as our Auction Services.

EnergyNet outperforms in 2014,increasing year-over-year property sales by 40%

EnergyNet 2014 sales by property type

Producing field

Combination interest (WI/ORRI/RI)

Operated working interest (WI)

Non-operated working interest (Non-Op)

Royalty (RI)

Overriding Royalty (ORRI)

Non-producing minerals

Non-producing leasehold interest

5% 26%

10%

19%16%

15%

6%3%

$283+ Million2014 sales

EnergyNet hosts an active online oil and gas marketplace with more than 18,000 active buyers and 4,200 active sellers*. We are proud to share our results with you!Special thanks to all our sellers: Because of you, EnergyNet achieved over $283 million in property sales for the year!* as of January 19, 2015

2014 In Review

4th Quarter 2013Total actual sales $92,020,288

Number of properties listed 1,010

Number of sellers 162

Number of sale closing days 30

Cumulative Stats for 2014Total actual sales $283,717,780Number of properties listed 4,552Number of unique sellers 395Number of sale closing days 123

As of January 19, 2015, EnergyNet has exceeded

$1.5 Billion in total sales!

3rd Quarter 2013 Total actual sales $79,729,537

Number of properties listed 1,081

Number of sellers 130

Number of sale closing days 33

2nd Quarter 2013 Total actual sales $68,136,626

Number of properties listed 1,428

Number of sellers 120

Number of sale closing days 31

1st Quarter 2013 Total actual sales $43,831,328

Number of properties listed 1,033

Number of sellers 113

Number of sale closing days 29

CLEAR FORK ROYALTY

®

FDICFederal Deposit Insurance Corporation

Family Properties, LP

Page 4: EnergyNet Quarterly Q1 2015

Please join us for one of the following events we'll be hosting or attending!

EnergyNet Events:Coming Soon!

February 10-13, 2015NAPE Summit – Visit us at Booth 2411 George R. Brown Convention Center – Houston, TXAttending: Bill Britain, Chris Atherton, Michael Baker, Lindsay Ballard, Cody Felton, Ethan House, Ryan Dobbs, Lauren Felton, Wildon Woolley, and John Laur

February 11, 2015IPAA – TIPRO LuncheonThe Petroleum Club of HoustonAttending: Chris Atherton and Cody Felton

February 13, 2015IPAA Wildcatter’s BallHilton Americas – Houston, TXAttending: Chris Atherton, Cody Felton and Lauren Felton

February 17, 2015Houston Producers’ Forum - Speaker: Brian Singer – Goldman SachsThe Petroleum Club of HoustonAttending: Chris Atherton and Cody Felton

February 25, 2015DUG MidcontinentCox Convention Center – Oklahoma City, OKAttending: Ethan House

February 25, 2015SPE Gulf Coast Business DevelopmentFour Seasons Hotel – Downtown Houston, TXAttending: Chris Atherton and Cody Felton

March 5, 2015ADAM Energy Forum Luncheon - Speaker: Nick Jones - ExxonMobilDallas Petroleum ClubAttending: Michael Baker and Lindsay Ballard

March 11, 2015IPAA – TIPRO LuncheonThe Petroleum Club of HoustonAttending: Chris Atherton and Cody Felton

March 25, 2015SPE Gulf Coast Business DevelopmentFour Seasons Hotel – Downtown Houston, TXAttending: Chris Atherton and Cody Felton

March 26, 2015IPAA Texas Wildcatter’s Open Golf TournamentBlackhorse Golf Club– Cypress, TXAttending: Cody Felton, Michael Baker, Lauren Felton and Lindsay Ballard

March 26, 2015Oklahoma Energy Explorers Meeting - Speaker: Martin Craighead – Baker HughesOKC Petroleum ClubAttending: Ethan House

April 1, 2015East Texas ADAM Luncheon - Speaker: Cameron D. Chandler, Chandler Energy Resources, LLCWillow Brook Country Club - Tyler, TXAttending: Lindsay Ballard and Michael Baker

April 8, 2015IPAA – TIPRO LuncheonThe Petroleum Club of HoustonAttending: Chris Atherton and Cody Felton

April 21-22, 2015Alliance Expo & Annual MeetingMPEC Wichita Falls, TXAttending: Michael Baker, Lindsay Ballard, and Ethan House

April 21, 2015Houston Producers’ Forum - Speaker: Doug Lawler – Chesapeake Energy CorporationThe Petroleum Club of HoustonAttending: Chris Atherton and Cody Felton

April 25, 2015NSWA Energy GalaSkirvin Hilton Hotel – Oklahoma City, OKAttending: Ethan House

If you have questions, or to learn more about these events, please email [email protected]. We'll see you there!

Page 5: EnergyNet Quarterly Q1 2015

STANDARD MAILUS POSTAGE

PAIDAMARILLO, TX

PERMIT NO. 444

EnergyNet.com, Inc.7201 I-40 West, Suite 319 Amarillo, TX 79106 (806) 351-2953 www.energynet.com

Call us at (877) 351-4488 or visit www.energynet.com

Business Development Team

V.P. of Engineering & Government Lease Sales John S. Munroe Office: (832) 403-3122 Cell: (713) 582-7755 [email protected]

PresidentChris Atherton Office: (713) 861-1866 Cell: (832) 654-6612 [email protected]

Houston / Eastern U.S Cody Felton Office: (713) 861-1866 Cell: (281) 221-3042 [email protected]

Permian Basin / East TX / North LA Michael Baker - VP Business Development Office: (972) 372-0232 Cell: (972) 898-5358 [email protected]

Mid-Continent / Texas Panhandle / AlaskaEthan D. House - VP Business Development Office: (405) 759-8437 Cell: (405) 255-5444 [email protected]

Western U.S.Ryan P. Dobbs Office: (303) 500-3063 Cell: (720) 459-2072 [email protected]

Permian Basin / East TX / North LA Lindsay D. Ballard Office: (432) 547-0424 Cell: (512) 269-9021 [email protected]

Contact us today to discuss your A&D objectives!