Forward-Looking Statements

This report contains "forward-looking" statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.  Forward-looking statements are typically identified by the use of the words "believe," "may," "could," "should," "expect," "anticipate," "estimate," "project," "propose," "plan," "intend," and similar words and expressions.  Statements that describe our future strategic plans, goals, or objectives are also forward-looking statements.  We intend that the forward-looking statements will be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. 

Readers of this report are cautioned that any forward-looking statements, including those regarding us or our management's current beliefs, expectations, anticipations, estimations, projections, strategies, proposals, plans, or intentions, are not guarantees of future performance or results of events and involve risks and uncertainties, such as:

• whether we will be able to discover and produce gas or oil in commercial quantities from any exploration prospect;

• whether we will be able to borrow funds to develop our oil and gas discoveries in Poland from our current principal lenders or from any other commercial lenders, even if we increase substantially the quantity and value of our reserves that we may be willing to encumber to secure repayment of such borrowings;

• whether the quantities of gas or oil we discover will be as large as our initial estimate of an exploration target area's gross unrisked potential;

• whether the estimated probable oil and gas reserves will ever be proved or produced;

• the rates at which our resources will be produced, particularly from properties for which we are not the operator;

• whether we will be able to obtain capital sufficient for our anticipated exploration and other capital expenditures;

• how our efforts to obtain additional capital will affect the trading market for our securities;

• whether actual exploration risks, schedules, and sequences will be consistent with our plans and forecasts;

• the future results of drilling or producing individual wells and other exploration and development activities;

• the prices at which we may be able to sell gas or oil;

• foreign currency exchange-rate fluctuations;

• the financial and operating viability and stability of the Polskie Górnictwo Naftowe i Gazownictwo, or PGNiG, and other third parties with which we conduct business and on which we rely to supply goods and services and to purchase our oil and gas production;

• exploration and development priorities and the financial and technical resources of PGNiG, our principal joint venture and strategic partner in Poland, PL Energia S.A., another partner in Poland, or other future partners;

• uncertainties inherent in estimating quantities of proved and probable reserves and actual production rates and associated costs;

• the cost and availability of additional capital that we may require and possible related restrictions on our future operating or financing flexibility;

• our future ability to attract industry or financial participants to share the costs of exploration, exploitation, development, and acquisition activities;

• the effect of future changes in reservoir pressure, prices, reservoir mapping, production rates, and other factors on reserve quantities;

• uncertainties of certain terms to be determined in the future relating to our oil and gas interests, including exploitation fees, royalty rates, and other matters;

• uncertainties, restrictions, and increased costs resulting from the current public interest and regulatory focus on hydraulic fracturing, which we intend to use in Poland and which we have used in our Montana oil exploration of the Alberta Bakken and Three Forks formation;

• changes in the regulatory regime for the exploration, development, and production of hydrocarbons in Poland, including changes in the scheme through which prices at which we sell our production may be governmentally established or market influenced and changes in applicable royalty rates;

• envioronmental hazards, such as uncontrollable flows of crude oil, brine, well fluids, hydraulic fracturing fluids, or other pollutants by us or third-arty service providers;

• uncertainties regarding future political, economic, regulatory, environmental, fiscal, taxation, and other policies in Poland and the European Union;

• the impact on us, our industry partners, our lenders, and others with which we deal of the continuing sovereign debt crises within the European Union, of which Poland is a member; and

• the factors set forth under the headings "Risk Factors" and "Management's Discussion and Analysis of Analysis of Financial Condition and Results of Operation" and other factors that are not currently known to us that may emerge from time to time.

The forward-looking information is based on present circumstances and on our predictions respecting events that have not occurred, that may not occur, or that may occur with different consequences from those now assumed or anticipated.  Actual events or results may differ materially from those discussed in the forward-looking statements.  The forward-looking statements included in this report are made only as of the date of this report.