Results of Operations Year Ended December 31, 2013 Compared to Year Ended December 31, 2012 Our operating data for 2012 and 2013 is summarized below: (1) Includes ad valorem taxes. (2) Represents depreciation, depletion and amortization of oil and gas properties only. Oil and gas sales. Our oil and gas sales increased $35.5 million (9%) in 2013 to $420.3 million from $384.8 million in 2012. Oil sales in 2013 increased by $50.7 million (28%) from 2012 while our natural gas sales decreased by $15.2 million (8%) from 2012. The increase in oil sales was attributable to the 29% growth in oil production offset by a 1% decrease in our realized oil prices in 2013. Our drilling activity in the Eagleville field in South Texas generated the oil production growth. With limited drilling in our natural gas properties in 2013, our natural gas production fell by 32% from 2012 while our realized natural gas prices increased by 36%. Production taxes. Production taxes increased $2.8 million or 24% to $14.5 million in 2013 from $11.7 million in 2012. The increase in 2013 is due to the 28% growth in our oil sales during the year. Much of our natural gas sales in 2012 and 2013 qualified for exemption from state production taxes. Gathering and transportation. Gathering and transportation costs in 2013 decreased $9.1 million (34%) to $17.2 million as compared to $26.3 million in 2012 due to the lower natural gas volumes that we produced in North Louisiana in 2013. Lease operating expenses. Our lease operating expenses, including ad valorem taxes, of $52.8 million in 2013 were $1.6 million or 3% higher than our operating expenses of $51.2 million in 2012. Our lease operating expense per Mcfe produced increased by 38% to $0.76 per Mcfe in 2013 as compared to $0.55 per Mcfe in 2012. The increase in operating costs mainly reflects our growing oil production. Our oil wells are typically more costly to operate than our natural gas wells. Oil production comprised 20% of our total production in 2013 as compared to 12% in 2012. The increase in the per unit costs is largely attributable to the lower production on a Mcfe basis. Much of our operating costs are fixed in nature. Exploration expense. We incurred $33.4 million in exploration expense in 2013 as compared to $61.4 million in 2012. Exploration expense in 2013 consisted of $33.0 million of impairments of 48 Year Ended December 31, 2012 2013 Oil & Gas Sales (in thousands): Oil sales .............................................. $181,163 $231,837 Natural gas sales ........................................ 203,651 188,453 Total oil and gas sales ................................. $384,814 $420,290 Net Production Data: Natural gas (MMcf) ..................................... 81,762 55,694 Oil (MBbls) ........................................... 1,792 2,314 Natural gas equivalent (MMcfe) ........................... 92,515 69,577 Average Sales Price: Oil ($/Bbl) ............................................ $101.09 $100.20 Natural gas ($/Mcf) ..................................... $2.49 $3.38 Average equivalent price ($/Mcfe) ......................... $4.16 $6.04 Expenses ($ per Mcfe): Production taxes ........................................ $0.13 $0.21 Gathering and transportation .............................. $0.28 $0.25 Lease operating (1) ....................................... $0.55 $0.76 Depreciation, depletion and amortization (2) ................... $3.76 $4.83