The principal elements of our business strategy are designed to generate growth in natural gas reserves, production volumes and cash flows at an attractive return on invested capital. We seek to achieve these goals through the application of the following strategies:

• Accelerating the development of our acreage position by increasing the level of our drilling activity

• Maintaining operational control over our assets in order to control the costs and timing of our exploration, development and production activities;

• Maintaining a low-cost and efficient operating environment by exploiting the economics of scale that arise from developing our large contiguous acreage position;

• Proactively managing legal, regulatory and environmental issues to ensure the efficient and timely development of our asset base

• Pursuing selective acquisition opportunities that would allow us to apply our CBM development expertise in other areas in the Rocky Mountain region

• Exploring the potential of the deeper lease rights below the Fort Union formation coal seams on our existing acreage position.

Competitive Strengths

We have a number of strengths that we believe will help us successfully implement our strategy.

• Experienced Management Team. Our key personnel have significant experience managing CBM operations, particularly in the Powder River Basin. Our management team has an average of 20 years of experience in acquiring, developing and operating oil and gas properties, primarily in the Rocky Mountain region.

• Significant Reserve Potential. According to the U.S. Department of Energy 2002 Study, the Montana portion of the Powder River Basin is estimated to have substantial recoverable reserves.  We hold a significant portion of the acreage that is prospective for CBM development in the Montana portion of the Powder River Basin.

• Low Geological Risk. The coal seams in the Powder River Basin that we target have been extensively mapped as a result of a variety of natural resource development that has occurred in the region.

• Low Development Risk and Predictable Results. As of December 31, 2006 we have drilled 613 gross (327 net) CBM wells. If as expected, we complete these additional wells, we will have completed over 99% of the CBM wells drilled through December 31, 2006.

• Large, Contiguous Acreage Position. Our acreage position of approximately 454,000 gross (308,000 net) acres includes one of the largest contiguous acreage positions in the Powder River Basin, our leases are in large blocks generally along the Wyoming and Montana border, adjacent to newly established areas of development activities.

• Local Presence. We are headquartered in Sheridan, Wyoming, which is the center of our project areas in the Powder River Basin. Our local presence gives us insight into the issues associated with Powder River Basin CBM development and the ability to quickly and effectively communicate with landowners, mineral owners and regulatory agencies.