Secondary Recovery Waterflood
A topical view depicting a traditional five spot.

Black Oaks Project
In September of 2006, we acquired an option to purchase the Black Oaks Project. As part of the purchase agreement we established a joint operating account and funded it with $4.0 million in April of 2007 specifically for the Phase I development plan of this project. The Black Oaks Project encompasses approximately 2,400 gross acres in Woodson and Greenwood Counties, Kansas, which at the time of acquisition had approximately 35 oil wells producing an average of approximately 32 BOPD.

The Black Oaks Project is a primary and enhanced secondary recovery project. Phase I of the Black Oaks Project development plan commenced shortly after closing with the drilling of 44 in-fill wells. During fiscal 2008, we began injecting water into the first five water injection wells at an average rate of approximately 50 barrels of water per day per well. This pilot program was expanded so that by June 30, 2008, we were injecting approximately 200 barrels of water per day per well in the initial 5 injection wells on the project. Adjacent oil wells showed increased production from an average of approximately 5 BOPD to 25 BOPD. As of March 31, 2009, we are maintaining the 200 bbls water/day average on the injection wells in the pilot program area. We have seen no additional response on this area as of yet. We are also injecting an average of 100 bbls water/day per well in 4 injection wells adjacent to the pilot program area and are closely monitoring data and activities for any resulting increase in production.  Based upon these results, we plan to commence Phase II of the development plan when additional development capital is available. Phase II contemplates drilling over 25 additional water injection wells, targeting water injection rates that will eventually increase to 300 barrels of water per day per well, and drilling and completing over 20 additional producer wells.

Black Oaks Potential

• 2.3 million to 3.0 million in potential recoverable reserves;
• $20 million additional capital investment;
• Management projections based on results from the ARCO water flood project; and
• Potential PV 10 enhancement $39 million to $63 million @ $70 a barrel.

Cautionary Note to U.S. Investors -- The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms on this web site, such as potential recoverable reserves, that the SEC’s guidelines strictly prohibit us from including in filings with the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 10-K, File No. 000-30234, available from EnerJex at 27 Corporate Woods, Suite 350, 10975 Grandview Drive, Overland Park, Kansas 66210. You can also obtain this form from the SEC by calling 1-800-SEC-0330 or on the SEC's website at www.sec.gov.