Acquisitions & Divestments

LONG LIVED RESERVES.
The properties that Central acquires have very stable production histories, long life, and shallow decline curves. Central's goal for R/P (reserves to production) ratio for all categories of proved reserves is a minimum of 10, while expense to revenue ratios generally do not exceed 35%. Payout must be achieved before the half-life of the reserve base is depleted.

WELL DEFINED UPSIDE POTENTIAL.
Substantial future low risk, proved, development potential exist within the fields, primarily in the form of infill drilling, exploitation of behind pipe reserves and the initiation of waterfloods. This inventory of low risk locations and projects provides for significant upside and additional cash flow development for many years.

OPERATIONS.
Central operates most of the large projects with significant low-risk upside potential, allowing flexibility and control over development of the fields, and thus the timing of increased cash flow. Increased efficiencies of operations is one of Central's hallmarks, whereby production can be increased and expenses decreased with little or no impact to current production.

MULTI-PAY POTENTIAL.
In many cases, there is additional potential in other producing horizons above and below those currently producing. Regulations covering many of the fields allow for downhole commingling of multiple producing horizons, resulting in significant acceleration of cash flow from behind pipe completions.

DECLINE RATE LEVELING
Central places great emphasis on the enhancement of currently producing wells and the low cost return to production of shut in wells. The result is a beneficial leveling of the decline rate, thus greatly increasing the recoverable reserves from the field.

OWNERSHIP AND ENVIRONMENTAL.
Central as a matter of course conducts title examinations and Phase I & II environmental audits on at least 80% of the value of its acquired properties, in accordance with generally accepted standards in the oil and gas industry.

FINANCIAL CONTROL.
Central conducts extensive financial due diligence prior to the close of any transaction, including revenue, lease operating cost, and capital expenditures. Cost control, minimal credit and commodity risk exposure and disciplined capital expenditures are Central's constant emphasis.

CONTROL OF HYDROCARBON DELIVERIES.
Central controls the deliveries of all volumes of hydrocarbons sold. This allows Central to make long term commitments for itself and its partners (if desired) for future deliveries when market conditions are positive.

WELL DEVELOPED INDUSTRY CONTACTS.
Central has proven itself as an independent producer with an established track record and the ability to close transactions in a timely manner, thus giving the company significant advantage in the acquisition of oil and gas properties through the negotiated process, without the pressure of competitive bids.