Projects

Kansas

AMI Project

Irvine acquired the Kansas oil and gas project through a Joint Venture with the Metro Energy Group. In July 2006 the Company completed the acquisition of a 75% working interest in 30,000 acres of oil and gas leases in Kansas and subsequently followed an aggressive growth campaign to increase its lease position to 112,000 acres spanning over the Barber, Butler and Cowley counties in Kansas.

Irvine's partner Metro has significant experience in the development of conventional and unconventional oil and gas projects. Metro is the operator of the project and has a 25% working interest.

The Project has an area of mutual interest ('AMI') covering approximately seven million acres in eleven contiguous counties in Kansas. The AMI has a prolific oil and gas production history as well as extensive infrastructure. The past lack of application of state-of-the-art exploration techniques in the AMI provides a significant upside potential.

Figure 1 - Eleven County AMI with Metro Energy in south
central Kansas

As of May 1, 2008, the Company has shot state of the art 3D seismic in two areas of Kansas (Rock and Ayres), with two more surveys to be completed (Udal and McGrath). The Rock 3D covers over 8 square miles and has generated several prospects, where a four well drilling programme has been initiated. The initial well, Rock 1-5, commenced drilling on April 29, 2008 and is targeting oil production from the Arbuckle formation at 3,500 feet in Cowley County, Kansas.

Figure 2 - Drilling of Rock 1-5 in Cowley County, Kansas

The Ayres 3D has been completed and processed and early indications are promising for similar type prospects. Since the Ayres 3D is approximately twice the size of Rock (15 square miles), the number of prospects are expected to be higher. The Udal 3D will even be slightly larger at 20 square miles. Acquisition of data from the Udal shoot is currently in progress in May 2008.

With the large number of wells expected to be drilled in the coming months, a rig has been contracted for a continuous drilling programme across the Rock, Ayres and Udal 3D areas.

It is the Company's near term objective to build production and a reserve base on these conventional targets and generate significant cash flow and net present value.

The AMI importantly houses the highly prospective Chattanooga Shale formation, which has successfully been drilled across state lines in Oklahoma (where it is known as Woodford shale) by Devon Energy and Newfield, among others. The Chattanooga Shale is relatively shallow and is an extension of the proven Woodford shale. With a land position of over 112,000 acres, Irvine has first mover-advantage in an area that has significant gas potential. Shale gas, due to the development of new extraction techniques, is the USA's fastest growing energy sector.

Figure 3 - Stratigraphic section of productive formations in Kansas, including Chattanooga shale

Niobrara Project

Irvine acquired a 50% working interest in the Niobrara Project in August 2007. The project comprises 4,490 gross acres in Cheyenne County, Kansas and is primarily focused on the development of shallow Niobrara chalk gas.

The license area includes 20 drilled wellbores in the Niobrara formation with over half of the wells going to sales as of April 2008. The remaining wells will be on line in May 2008; with total projected gross production of 1,000 mcfd. It is estimated that 40 wells will be drilled by year end 2009, with an additional 56 wells to be drilled in following years. Due to the shallow nature of these wells (1500 feet) they can be drilled in less than one week at very low cost. Wells will be drilled in "packages" of 10-20 at a time, starting in late summer 2008.

Figure 4 - Geologic outcrop of Niobrara chalk formation 100 miles SE of
Irvine acreage

Figure 5 - Geologic setting of Niobrara chalk in NW Kansas

Oklahoma

Oklahoma Project

The Oklahoma project covers over 50,000 gross acres (25,000 net acres) in Okfuskee, Okmulgee, and McIntosh and Hughes counties. This project has significant potential in conventional oil and gas, as well as Woodford and Caney shale gas and coal bed methane (CBM). The Company purchased this property in January 2008, which included over 20 producing wellbores and fifty-four square miles of 3D seismic. Production net to the Company at time of purchase was over 600 MCFDE. Since then, four additional conventional gas wells have been drilled.

Figure 6 - Irvine acreage position in Oklahoma, with 3D coverage hi-lighted

Figure 7 - Workover in progress on Irvine purchased well in Oklahoma

Currently the Company is stepping up activity in the Caney and Woodford shale, with their first vertical new well currently being completed. The Company's first horizontal well is planned to spud in May 2008. A large drilling inventory is also being developed for both the Caney and Woodford shale. Successful development of the Caney and Woodford shale could be huge, with as many as 400 - 800 locations possible. Netherland, Sewell and Associates have assigned a best case contingent resource estimate net recoverable to the Company of 238 billion cubic feet (BCF) of gas.

Current plans also include drilling and completing both vertical and horizontal Hartshorne coal bed methane (CBM) wells in Q3 2008. Assessment of the CBM resource and value is in progress.

Figure 8 - Stratigraphic section of productive formations in Oklahoma, including Caney and Woodford shale