In the first half of 2005, Gasco entered into a farm-out agreement under which an unrelated entity has committed to drill one well on Gasco’s acreage in San Luis Obispo and Kern Counties, California. We currently expect to spud this well prior to the end of 2005. Under this agreement, Gasco will contribute the acreage, and the unrelated entity will pay the drilling and completion costs. Gasco will retain a 25% interest in the initial well and the remaining acreage. The Company is also continuing to pay leasehold rentals and other minimum geological expenses to preserve its acreage positions on its remaining California prospects. The project is in close proximity to the Midway-Sunset and Belgian Anticline oil fields which combined have cumulative production in excess of 2 billion barrels of oil. Gasco owns or controls approximately 3,313 gross acres (2,524 net acres) in Kern and San Luis Obispo Counties in Southern California.