Xfuels Inc (XFLS)

[M-Fondu]

I emailed Mike this week about the Harvest Purchase and looking forward, got a prompt response:

Good Morning Mike,

I had a couple more questions if you don't mind:



- Are all 23 leases transferred over with the Harvest Purchase?

Yes anything Harvest owns is now part of Cycle

- Are all 23 viable for production or are some going to be abandoned?

We will evaluate the financial viability of the assets on a case by case basis if they are not viable we will plug them and carry on that’s what we do.

- Do you intend on trying to revive the shut in wells?

Again quite simply that is what we do.

- Are you able to provide production costs estimates for the Texas oil fields and is there a price target for WTI crude to allow them to restart production?

Not at this time we are still looking at the best place to deploy the capital

- Are all wells vertical or are some horizontal/fractured wells?

All are low impact vertical



One thing to note with the purchase of Harvest we are now 100% owner in the NWLH, California property we previous bought 60% of. Our intent in Texas is to acquire more assets in the south eastern part of the state. As the larger companies retreated for west Texas shale they left hundreds of hidden gems in the area.



Our focus for now will be the NWLH lease in California as it has the greatest upside and fastest ROI.