SPECIAL PROVISIONS FOR NAESB BASE CONTRACT FOR SALE AND PURCHASE OF NATURAL GAS

Exhibit 10.5

SPECIAL PROVISIONS FOR NAESB BASE CONTRACT
FOR SALE AND PURCHASE OF NATURAL GAS

     Seminole Energy Services, LLC (“ Buyer ”) and Daugherty Petroleum, Inc. (“ Seller ”) hereby agree as of July 15, 2009 (the “ Effective Date ”) to the following Special Provisions, which hereby amend and modify the NAESB Base Contract for Sale and Purchase of Natural Gas (including the General Terms and Conditions) (the “ Base Contract ”) executed by the parties on July 15, 2009. All capitalized terms, unless otherwise defined herein, have the meanings set forth in the Base Contract.

Modifications to Base Contract

     1.  Additional Definitions . Section 2 of the Base Contract is hereby amended to add the following definitions:

     “ Asset Purchase Agreement ” is defined in the Gathering Agreement.

     “ Committed Reserves ” means all of Seller’s Interests in and to all natural gas reserves in and under or that otherwise may be attributable to any of the lands or geographic area covered by, or included within the four corners of, the map depicted on Exhibit A , excepting and excluding therefrom the Gausdale/KayJay, Fount, Pineville, and Skinner Production Areas.

     “ Contract Quantity ” means the sum of Seller’s Daily Deliverability of Gas and the Existing Contracts Volume, not to exceed an aggregate of 30,000 Mcf’s per Day.

     “ Delivery Points ” means the points on the Gathering System described in Exhibit B where Buyer purchases Seller’s Gas hereunder.

     “ Existing Contracts ” means the Gas Gathering Agreement, dated March 14, 2006, between NGAS Gathering, LLC and Chesapeake Appalachia, L.L.C. and the Gas Gathering Agreement, dated October 5, 2004, between Duke Energy Gas Services Corporation and Forexco, Inc.

     “ Existing Contracts Volume ” means the volume of Gas to be gathered by Seller under the Existing Contracts on any Day, together with volumes of Gas to be sold by Seller to Stand Energy under the Stand Contract to the extent permitted herein below.

     “ Forward Sale Agreement ” is defined in Section 15.13 hereof.

     “ Gathering Agreement ” means the Gas Gathering Agreement, dated of even date herewith, between Buyer and Seminole Stone Mountain, LLC and NGAS Gathering II, LLC.

     “ Gathering Fees ” is defined in the Gathering Agreement.

     “ Gathering System ” is defined in the Joint Ownership Agreement.

     “ Joint Ownership Agreement” is defined in the Asset Purchase Agreement, as such joint Ownership Agreement may be amended from time to time.

     “ Processing Agreement ” means the Gas Processing Agreement, dated September 14, 2007, among Seller, as producer, and Seller and Seminole Gas Company, as plant owners.

     “ Receipt Points ” means the points on the Gathering System described in Exhibit B where Seller’s Gas is received by Buyer into the Gathering System.

     “ Rogersville Plant ” means the Rogersville Gas Processing Plant in Christian County, Tennessee.

     “ Seller’s Daily Deliverability of Gas ” means the volume of Gas which is physically capable of being produced by Seller on any Day in accordance with applicable laws and good industry practices from the Committed Reserves.

     “ Seller’s Interests ” means the oil, gas, and mineral interests owned or controlled by Seller or its Affiliates in and to any of the lands or geographic area covered by, or included within the four corners of, the map depicted on Exhibit A , excepting and excluding therefrom the Gausdale/KayJay, Fount, Pineville, and Skinner Production Areas, as the same may be extended or expanded from time to time., whether now owned or hereafter acquired, and the production therefrom, and all interests in any wells, whether now existing or drilled hereafter, on or completed

on any of the lands or geographic area covered by, or included within the four corners of, the map depicted on Exhibit A , excepting and excluding therefrom the Gausdale/KayJay, Fount, Pineville, and Skinner Production Areas, as the same may be extended or expanded from time to time., or within any pooled area, communitized area, or unit, even though Seller’s Interest may be incorrectly or incompletely stated, all as the same shall be enlarged by the discharge of any burdens or by the removal of any charges or encumbrances to which any of same may be subject as of the Effective Date, and any and all replacements, renewals, and extensions or amendments of any of the same.

     “ Stand Contract ” means that certain Base Contract for Short-Term Sale and Purchase of Natural Gas dated as of November 21, 2001, by and among Seller and Stand Energy, as amended, together with any and all existing confirmations, purchase orders or other commitments remaining under (or executed in connection with) this contract.

      “Stand Energy” means Stand Energy Corporation.

     “ Stand Lockbox ” means a new, segregated bank account established by Buyer, and which Buyer shall have the sole right to withdraw funds or amounts. The purpose of the Stand Lockbox will be to receive Stand Proceeds, and neither Buyer nor Seller shall deposit any other amounts therein.

      “Stand Proceeds” means any payments, proceeds, fees or other amounts to be paid to Seller in, under or in connection with the Stand Contract, together with any interest or earnings thereon, if any, to the extent deposited in the Stand Lockbox.

     2.  Quantity . Section 3.1 is amended to add the following sentence:

     “Seller shall deliver, and Buyer shall receive, the Contract Quantity each Day on a Firm basis. Seller’s Gas and the Existing Contracts Volume shall be delivered to Buyer at the Receipt Points for gathering on the Gathering System, and Seller’s Gas shall be purchased by Buyer at the Delivery Points, all as set forth herein. The Existing Contracts Volume shall be gathered, but not purchased, by Buyer hereunder. For purposes of clarity, the Contract Quantity shall include only Gas volumes attributable to the Committed Reserves and the Existing Contracts and Seller shall not deliver, and Buyer shall have no obligation to receive hereunder, any Gas volumes produced or owned by third parties, other than Gas produced by Seller and its Affiliates in wells located on the lands described in Exhibit A and the Existing Contracts Volume, which shall be gathered, but not purchased, by Buyer hereunder. Buyer shall never be obligated to receive on any Day volumes of Gas hereunder in excess of 30,000 Mcf’s per Day, as such maximum volume is allocated to each Receipt Point as shown in Exhibit B , except that Seller, prior to the second anniversary of the Effective Date, shall have the right to deliver volumes to the Fonde Receipt Point in excess of the maximum volume shown in Exhibit B for such Receipt Point up to the lower of (x) the maximum available receipt capacity at such Fonde Receipt Point, or (y) a volume that when added to all volumes delivered by Seller at all Receipt Points does not exceed 30,000 Mcf’s per Day, by written notice to Buyer. If Seller elects to deliver such additional volumes to the Fonde Receipt Point, then Seller shall reduce (but not increase) the volumes delivered at one or more of the other Receipt Points so that the total volumes delivered hereunder never exceed 30,000 Mcf’s per Day. Any such election by Seller shall remain in effect until the second anniversary of the Effective Date and, for the term of the Contract, unless, prior to the second anniversary of the Effective Date, Seller notifies Buyer of any additional increase (but not decrease) in the volumes to be delivered to the Fonde Receipt Point (up to 30,000 Mcf’s per Day), and the corresponding reductions in the volumes delivered at one or more of the other Receipt Points necessary to cause the total volumes delivered hereunder to never exceed 30,000 Mcf’s per Day. Such final election by Seller shall remain in effect for the remaining term of this Agreement.”

     3.  Seller’s Reserves Commitment . The following Section 3.5 shall be added to Section 3 of the Base Contract:

     3.5 Seller’s Reserves Commitment

          (a) Commitment . Each Day Seller shall make available to Buyer at the Delivery Points all of Seller’s Daily Deliverability of Gas. Subject only to Seller’s reservations below, Seller exclusively commits to the performance of this Agreement the Committed Reserves, represents that the Committed Reserves are not otherwise subject to any purchase and sale agreement, except as shown on Schedule 3.5 , and agrees not to sell, transfer, or deliver to any third party any Gas produced from the Committed Reserves. Seller agrees to cause any

existing or future Affiliates of Seller to be bound by, and to execute and join as a party, this Agreement. Seller agrees that this dedication is a covenant running with the land.

          (b) Seller’s Reservations . Seller reserves the following rights (and reasonable quantities of Gas to satisfy same): (i) to operate wells producing from the Committed Reserves as a reasonably prudent operator, (ii) to separate or process the Gas using only mechanical, ambient temperature equipment located at surface production facilities on the Subject Leases, (iii) to use Gas produced from the Committed Reserves for operating the wells located thereon, (iv) to pool or unitize the Committed Reserves, in which event this Agreement shall cover Seller’s Interest therein, and (v) to process Gas delivered hereunder in the Rogersville Plant for the extraction of natural gas liquids under the Processing Agreement. In addition, Seller’s reservations also include the volumes of Gas sold under the Stand Contract, subject to the provisions of Section 3.6 and 3.7 below with regard thereto.

          (c) Memorandum . Seller shall enter into and deliver to Buyer, at Buyer’s request, a fully recordable memorandum of this Contract, in a form acceptable to Buyer.

     4.  Contract Price . The following Section 3.6 and Section 3.7 and Section 3.8 shall be added to Section 3 of the Base Contract:

     3.6. Contract Price .

          (a) Net Proceeds . As full and complete consideration for the purchase of Seller’s Gas hereunder, Buyer shall remit to Seller the amount by which (i) the proceeds from all physical sales received by Buyer from the resale of such Gas at or downstream of the Delivery Points, adjusted for any and all credits or debits from Fixed Price Trigger Transactions as may be entered into and identified as such from time to time, together all Stand Proceeds received by Buyer or deposited in the Stand Lockbox during the Month in question (collectively, the “ Monthly Net Proceeds ”) exceeds (ii) the Gathering Fees for the same Month under the Gathering Agreement, less an administrative fee of $0.015 per MMBtu of Seller’s Gas purchased hereunder; provided, however, that the $0.015 administrative fee will not be deducted or charged by Buyer with regard to either (x) the volumes of Gas sold directly by Seller under the Stand Contract, or (y) volumes of Gas purchased by Buyer where there is no back-to-back contract with a third party, as contemplated in Section 3.6(d) below.

          (b) Seller’s Payment Obligation . Seller shall owe and pay to Buyer all of the same Gathering Fees as are provided as Gathering Fees under the Gathering Agreement. Notwithstanding the netting permitted by Buyer under Section 3.6(a) above, Seller shall always be obligated each Month to pay to Buyer the amount, if any, by which (i) the Gathering Fees for that Month exceeds (ii) the Monthly Net Proceeds for such Month. For example, if, for any reason (including the occurrence of a Force Majeure event or diminished Committed Reserves), the Gas volumes delivered by Seller in a Month are insufficient to result in Monthly Net Proceeds received by Buyer that exceed the Gathering Fees in the same Month, Seller shall be required to pay to Buyer the amount of such difference.

          (c) Annual Adjustment . The term “ Gathering Fees, ” when used in Section 3.6(a) and (b) , means all of the Gathering Fees as defined in the Gathering Agreement, as adjusted from time to time under Section 4.2 , Section 4.3 and Section 4.5 of the Gathering Agreement.

          (d) Marketing Efforts/Prices. Except as hereinafter provided in Section 3.7, Buyer and Seller agree that Buyer shall be the first purchaser (First Purchaser) of Seller’s Gas at the Delivery Points hereunder. The price paid to Seller by Buyer as First Purchaser shall be identical to the price received by First Purchaser from a Second Purchaser, as hereinafter defined, for Gas at the Delivery Points less an administrative fee of $0.015 per MMBtu. Using commercially reasonable efforts First Purchaser shall coordinate with Seller regarding the various terms, prices, and other conditions pursuant to which Gas shall be sold by First Purchaser to third parties (Second Purchaser[s]) at the Delivery Points. Accordingly, Buyer as First Purchaser shall solicit offers from potential Second Purchaser(s) it deems appropriate to purchase Gas at the Delivery Points. To the extent First Purchaser elects to do so, at its sole option and election, First Purchaser shall have the right to propose terms and prices for its purchase of the Seller’s Gas as a Secondary Purchaser or to match the terms and price of the then highest-priced offer received from a third-party Secondary Purchaser (if First Purchaser elects to match, then preference will be given to First Purchaser’s offer and First Purchaser shall purchase and pay the offered amounts, subject to the other terms hereof). In addition, Seller shall have the right and option to notify First Purchaser by verbal or written communication of possible sales opportunities with potential Second Purchaser(s) of Seller’s Gas (insofar as the proposed term of such opportunities would not extend beyond the term of this Agreement). Using commercially reasonable efforts, First Purchaser shall timely present to Seller (whether verbally or in writing) such offers as it may obtain from potential third-party Second Purchasers for such volumes of Gas at the Delivery

Points, and if it so elects to also present to Seller the First Purchaser’s own offer or offers to match the then highest-priced third-party offer received and currently presented. Seller shall elect and direct at its sole discretion which offer First Purchaser should pursue, accept, and confirm (or if First Purchaser has offered to match the highest-priced offer from a third-party Second Purchaser currently presented to Seller then to accept the matching offer of First Purchaser); further provided, however, that it shall be Seller’s sole choice and election as to which of t