(5) Equity Investment in Sunrise Energy

9 Months Ended

Sep. 30, 2011

Equity Investment InSunrise Energy

(5)           Equity Investment in Sunrise Energy

In late December 2010, we invested $2.375 million for a 50% interest in Sunrise Energy, LLC which then purchased existing gas reserves and gathering equipment from an unrelated third party with plans to develop and operate such reserves. Sunrise Energy also plans to develop and explore for coal-bed methane gas reserves on or near our underground coal reserves.  They use the successful efforts method of accounting. We account for our interest using the equity method of accounting.

Below (in thousands) are a condensed balance sheet at September 30, 2011 and a condensed statement of operations for the nine months ended September 30, 2011.

Condensed Balance Sheet

	2011
Current assets	$	2,321
Oil and gas properties, net		6,084
	$	8,405
Total liabilities	$	2,106
Members' capital		6,299
	$	8,405

Condensed Statement of Operations

	2011
Revenue	$	3,112
Expenses		(1,564	)
Net income	$	1,548