Energy Accounting

1. Purchase in fee requires that the purchase price be allocated between the mineral and surface rights acquired. t/f

2. The objective of oil and gas opperation is to find, extract, refine, and sell oil and gas, and related products. t/f

3. U.S. publicly traded exploration and production companies, oil and gas reserves are required to be reported in the notes to their annual reports filed with SEC. t/f

4. Minimum royalties usually arise from an agreement in which the lessee agrees to pay a stated minimum amount of royalty. t/f

5. Casing made of steel or high-tech alloys is lowered into the hole and cemented into place to protect fresh water aqufifers. t/f

6. A top lease is an infrequent activity. t/f

7. Most oil and ggas companies utilize the succesful-efforts method of accounting. t/f

8. The SEC final rule defines the terms "developed oil and gas reserves" and "undeveloped oil and gas reserves" without regard to the classification of reserves as proved or unproved. t/f

9. Horizontal wells are initially drilled staight down but then are gradually curved until the hole runs parallel to the earth's surface. t/f

10. The final rule does not require foreign private issues to comply in form 20-F with the same reserves disclosure requirements applicable to domestic users. t/f