Texas standard energy

DRILLING ON PROVEN RESERVES

All claims are independently verified by a third-party engineering firm

Over 100 Drilling locations

Proven Reserves to Drill On

*As defined in the 2015 Haas Engineering reserve report.

Proven one of the lowest known breakevens in the industry

Proven team of Barnett Shale specialists to execute development

Proven fracking source Quasar Energy Services has fracked thousands of Barnett Shale wells over the last 20+ years. They have also re-fracked 100’s of wells in the last 5 years, enhancing returns on existing wells

Proven third party Barnett Shale Engineers

Proven 3D seismic with 100s of successful wells drilled from data

Proven contracted low cost water

See aerial photo of reservoirs

Proven Natural Gas and Liquids contract – 3 years of performance

Proven all operations in Texas, one of the nation’s most friendly oil and gas state

A Natural Market Hedge

Proven Three Revenue Streams

Barnett combo named by EOG produces three streams of almost-equal quantities.

Stream One

Oil

High Quality
40° Gravity, Sweet
Commands premium price WTI +

Stream Two

Dry Gas

Located near fourth largest metroplex in US. 7.6 million consumers based on 2020 census

Rapidly growing gas market

Stream Three

Liquids

Moves via Pipeline to the Texas Gulf Coast market. One of the most competitive U.S. Markets

Feedstock for plastics = fast growing sector

26 years in Barnett

Fairfax Energy

Fairfax Energy Corporation will support Texas Standard Energy with:

High quality drilling locations on proven reserve acreage
Contracts for low cost frack water – average $200,000 /well savings
Natural gas contract without markup to TSE fund
Targa’s pipelines and gas gathering systems crisscross area of interest
Targa’s Bellevue compression station is operating far below its capacity
18 years of active leasing in area of interest
Former county judge is landman
Owned field offices & facilities
Operator with over 25 year working history with Texas Railroad Commission
Area of interest is well served with low cost rural electricity to power electric drilling rigs
Long standing relationship with areas largest, oldest and most experienced frack and cement provider
Modern 3D seismic data that covers the area of interest
Targa’s pipeline system serves most, if not all of the areas of interest
The area of interest is also served by Atmos

Unmatched Experience

Our Leadership Team

Rodney & Josie Hughes

CEO

Read Bio

Joe Autem

CFO

Read Bio

Long-standing relationships

Motivated by project success

Details matter

Totally committed to the Barnett Combo Project

First Independent to Hire 8 Top Barnett Shale Industry Professionals

View Team

Sponsor Section

Haas Engineering

Texas Standard Energy, and affiliates, are fully engaged with the firm. Haas serves in all engineering roles and overviews every phase from well maintenance to drilling and fracking. Beginning in 2004, the firm advised on lease location for acquisition as the Barnett expanded. All planning for drilling and completion begins and ends with Haas Engineering playing a vital role.

Oil, Energy, and Gas sector

Why the Barnett Shale

industry advantage

The Barnett Combo has one of the lowest breakeven economics in the industry. The current economics only take into account the initial drilling program, which is only the beginning of the production life cycle of the Barnett Combo oil and gas wells. At some point in the years after the initial production from each well a re-frack program can be implemented to augment the production, which will significantly impact the economics in a positive manner. Texas Standard’s project manager has been re-fracking Barnett shale wells since 2015. As Devon’s completion engineer supervisor he has successfully re-fracked over 100 horizontal and 1,000 vertical wells. Most active operators in the Barnett have active re-frack programs. An existing wellbore that is fully equipped is a valuable asset that offers an economic opportunity to recover additional oil and gas in place without the cost of a new well. Some estimates suggest that for 1/3rd of the cost of a new well, 80% of recoverable reserves of a new well can be produced. Re-fracking will be in place in the Barnett Shale to add economic value to TSE’s Barnett Shale combo projects.

First independent to acquire seismic data, drill, frack, and deploy microseismic surveys to ascertain if the frack stayed in the zone. Also acquired full cores, side wall cores, and utilize full suite of BJ Hughes logs to produce six vertical wells in the Archer county Barnett Shale.

Texas Standard Energy has the highest regard for lowest cost efficiency. All the while, maintaining strict environmental behavior during every operational phase. The drilling rigs rated to drill a total well depth of 15,000 feet are top drives powered by electricity. In a normal operation, diesel powered generators create the electricity that drives hydraulic equipment which moves everything. The area of interest where TSE will drill is well served with rural electric power which, in most cases, will be used rather than the less desirable diesel generators, and with a cost savings. Texas Standard Energy will deliver it’s gas through company owned pipelines that connect to Targa’s gathering system. Targa’s grid of pipelines in the area are operated at low pressure and far below it’s volume capacity. Texas Standard has no need to flare natural gas due to owning our own gas gathering and delivering in to a system operating far below its rated capacity.

1996

One of the first Independent operators in the Barnett Shale

2000 - 2003

Drilled 92 vertical wells in the Barnett Shale and sold assets to Encana

2000

One of the first independents to drill in Barnett Shale Denton counties rich gas region

2003

First acreage block acquired and vertical well drilled in Barnett Shale in Western Montague County oil window

2004

First Barnett Shale acreage block assembled in oil window and sold to EOG in 2007

2019

First independent to drill horizontal well in Barnett Shales oil window

192 Wells Permitted and/or Drilled in the Barnett in the Last 12 Months

Hundreds of Barnett Wells Re-Fracked in the last 12 Months

*Ref: Drilling Info

Hillwood Oil & Gas Operating LP

BKV Barnett LLC

Lime Rock Resources IVALP

Bedrock Production LP

Canyon Operating LP

Joint Resources

McCutchin Petroleum Corp.

Sage Natural Resources LLC

Lakota Energy LTD

Total (TEP) Barnett USA LTD

GHA Barnett LLC

XTO (Exxon)

Strategic Partners

rusty-and-i-on-pad-being-built-for-orton

Pictured: Rusty Werline, Rodney Hughes, and Reagan

A message from our founder

“I don’t know of a single project being offered anywhere to anyone with *proven reserve designation……..generally, operators have geology that presents a good case for acquiring leases and drilling but, at best, that kind of acreage is no more than “prospective” and far removed from having proven designation.”

RODNEY HUGHES

As defined by the Society of Petroleum Engineers (SPE) An estimate of reserves as provided in a third-party engineering reserve report

Risk Factors and Disclaimers

This website, including all data, figures and other reports, is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy securities.

The information on this website is only current as of the most recent date indicated, and Texas Standard Energy may revise or amend the information on this website at any time. TSE’s prior performance is not indicative of future results and there can be no prediction as to the future production, if any, of any oil and gas well to be drilled. This information on this website is not investment advice and should not be relied upon for any investment purpose.

TSE disclaims all responsibility or liability for any direct, indirect or consequential loss arising directly or indirectly from the: (1) reliance upon information contained on this website; (2) any error, omission or inaccuracy of the information contained on this website; and (3) any actions taken in reliance upon the information contained on this website.

Field Office:

Texas Standard Energy
810 FM 174
Bowie, Tx 76230

(972) 689-4202

Corporate Office:

13355 Noel road
Suite 1100
Dallas, TX 75240

Rodney Hughes

1942 – Born and raised in Texas/Oklahoma by 3rd generation farming and ranching family. Born in Littlefield, Texas.... family moved to a ranch on the Red River and attended, graduated Olustee Public Schools, Olustee, Oklahoma 1960-1985 – Ranched for 27 years following graduation from High School. Active in the cattle business as an owner/operator of wheat farms and ranches where cattle were grazed. In 1965 became a junior partner in an Oklahoma City based order buying firm.......became full partner in 1968.......15 of the 17 years the firm was the largest buyer/seller of feeder cattle in the US 1974-1980 – Shareholder/Board of Directors, of a small Bank 1975-2022 – Oil and Gas investor for 47 years 1982-1990 – Drilled 50 shallow vertical wells over 5 years in the Fort Worth Basin, primarily Jack County 1983-1987 – Researched, designed and patented an aluminum sucker rod for use in pumping oil wells with downhole pumps. Created computer managed rod design program specific to aluminum. Field tested for one year and marketed to oil operators in Kansas, Oklahoma and Texas In 1987 the business was sold to Kaiser Aluminum, the high bidder among the 3 aluminum majors. 1990-1998 – Acquired Oil and Gas Properties being sold by Resolution Trust Corporation 1996 – Acquired 4,000 acres in partnership with a small operator, drilled 6 vertical wells. Wells were among the first drilled after Mitchell Energy proved slick water fracking could make the Barnett shale economically productive. Assets sold in 1999 to Enre Oil and Gas/Heller Financial (4-1 return on investment). 1998 – Founded Fairfax Design which designed and manufactured elegant ranch furniture sold to top interior designers with projects in Wyoming, Colorado, Arizona, Utah, California, Oklahoma and Texas........business continues today under ownership of my son, Kent, and is based in Memphis, Tn 1999 – Acquired 12,000 acres of Barnett Shale acreage between Denton and Decatur, Texas. Acquired development financing from Southern Utility/Atlanta, Ga....... partnered with operator and drilled 92 vertical wells. Assets sold to Encana in 2003 for $123M (Net gain to my interest of $14M) 2002 – Assembled a 10,000 acre block of Barnett acreage in southern Montague County. Area is rich gas and condensate which could not be economically produced from vertical wells at the time..... (Project lost $4M) Pioneer later acquired most of the acreage and developed with horizontal drilling. Failure motivated the formation of a business relationship with Haas Engineering which has continued for 18 years. 2004 – Acquired 11,000 acres in eastern Clay County in a region that came to be identified as the Barnett Combo region........labeled so by EOG Resources due to 3 streams of hydrocarbons produced. Sold acreage to EOG in 2007. (Net gain of $3.75M plus an override of 12%) 2007 – Acquired 13,966 acres in Archer County as an extension of the Barnett Combo region....... Combo meaning oil, dry gas and natural gas liquids which are all produced in the hydrocarbon stream. Sold shallow rights (all potential productive horizons except for the Barnett Shale) retaining the Barnett Combo and a 5% over ride on all production. Extensive testing has proven the Barnett Combo as oil productive and an excellent target to be drilled horizontal. (Project has returned 200% on initial investment plus retaining the Barnett Shale rights) Forty one wells have been drilled on the acreage testing 4 producing zones above and below the Barnett. Seven vertical Barnett completions and cores from 3 wells confirm higher rate of natural fractures and hydrocarbon richness of the Barnett on the acreage. I managed my investment portfolio of 300 stocks from 2005 until electing to exit the market in July of 2007 – moved to real estate and the current oil and gas lease positions. 2010 to Present – re-assembled acreage previously sold to EOG after they allowed leases to expire in 2010-2012. Pioneer enters Barnett Combo in 2010, acquires 165,000 acres, drills 195 horizontals. Pioneer drilled the 30 best performing wells of 2,500 drilled in the Combo in 2012 and 2013. Several of the highest rate wells are offset wells to the Clay County acreage block. The downturn in oil and gas prices in 2014 eliminated the economic opportunity to begin early stage development of either the Clay County/Montague acreage block or the Archer county Aminex Lease, which held over 25,000 acres. The low price climate discouraged development until late 2017. The low price environment forced operators to test larger, more technical frack methods in an attempt to increase production which would lower break evens. We are now in the 4th and 5th generation of the frack expansion which have in most shale plays doubled the recoverable oil and gas reserves, sometimes more. The price downturn occurred just as development plans were beginning to take shape for the Clay County acreage in 2014. The recovery of prices for all 3 hydrocarbon components, along with the potential of much higher production rates from improved fracking methods, offers as many as 200 viable horizontal drilling locations across the two acreage positions. The priority for drilling is Clay County with Archer County to follow. The Orton A 1H was completed on the acreage in late in 2019 utilizing a 6,600 ft long lateral fracked in 33 stages deploying twice the sand and water volumes of the offsetting wells which are the highest producers out of 2,500 Barnett Combo wells drilled by EOG and Pioneer Resources. The well confirms the quality/continuity of the high rate of natural fractures in the Barnett that Pioneer discovered with their offset drilling in 2012 and 2013. The Orton A 1H serves to prove my development team can execute the drilling and completion of a horizontal well deploying modern frack design. I am married to Josie and in our 10th year of marriage. I have 3 children, two sons and a daughter, 6 grandchildren and 6 great grandchildren. I attend the Baptist Church and have been a member at Parkway Hills Baptist church in Plano, Tx for 30 years. We also attend Trinity Church in Beaver Creek, Colorado. I am a 25 year supporter of First Liberty and spend some time in volunteering. I am a founding member of HELPS which supports 6 small villages in an area in northern Guatamala known as the IXIL Triangle. We help with financial support for food, pharmaceuticals and education. I enjoy working, working out, golf, genealogy of my family and spending time with my growing family. In addition to our home in Plano we enjoy our home near Vail, Colorado purchased in 2005. We also spend time in Hot Springs, Va where we have another home purchased in 2006.

Texas standard energy

DRILLING ON PROVEN RESERVES

Over 100 Drilling locations

Proven Reserves to Drill On

A Natural Market Hedge

Proven Three Revenue Streams

Stream One

Stream Two

Stream Three

26 years in Barnett

Fairfax Energy

Unmatched Experience

Our Leadership Team

Rodney & Josie Hughes

Joe Autem

Long-standing relationships

Motivated by project success

Details matter

Totally committed to the Barnett Combo Project

First Independent to Hire 8 Top Barnett Shale Industry Professionals

Sponsor Section

Haas Engineering

Oil, Energy, and Gas sector

Why the Barnett Shale

industry advantage

1996

2000 - 2003

2000

2003

2004

2019

192 Wells Permitted and/or Drilled in the Barnett in the Last 12 Months

Strategic Partners

A message from our founder

Risk Factors and Disclaimers

Field Office:

Texas Standard Energy810 FM 174Bowie, Tx 76230

Corporate Office:

13355 Noel roadSuite 1100Dallas, TX 75240

Rodney Hughes

Joe Autem

Terry D. Harvey

Texas Standard Energy
810 FM 174
Bowie, Tx 76230

13355 Noel road
Suite 1100
Dallas, TX 75240