Lucas Energy, Inc. purchased a shut in well (Griffin Oil Unit No. 2) in

June 2006 from a local oil producer operating several wells in Gonzales County, Texas. The cost of the acquisition was $15,000. The Company invested another $120,000 in a pumping unit, tubing and rods, and workover expenses to put the well back on production. Since putting the well back on in July 2006, the well has made more than 33,000 bbls of oil from the Austin Chalk formation.

The Griffin Oil Unit No. 2 well was originally drilled and completed in

January 1991. The well produced more than 280,000 bbls of oil prior to being shut in in the year 2000. Several attempts were made to restore production after that without success. Lucas Energy, Inc. acquired the well bore and unit leasehold rights in 2006 and restored production. The first year, the well made more than 12,000 bbls of oil.

To date, the well has grossed more than $1.8 million to the Company's interest; and Lucas has netted $1.3 million after capital and lease operating expenses. Lucas Energy, Inc. owns 100% of the working interest in the well. Production taxes are abated due to a shut in tax exemption which Lucas received from the State of Texas.