UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------

SCHEDULE 13E-3

(AMENDMENT NO. 1)

TRANSACTION STATEMENT UNDER SECTION 13(e)

OF THE SECURITIES EXCHANGE ACT OF 1934
----------------

AVOCA, INCORPORATED
(Name of the Issuer)
----------------

AVOCA, INCORPORATED
(Name of Person(s) Filing Statement)
----------------

Common Stock, No Par Value
(Title of Class of Securities)

053843108
(CUSIP Number of Class of Securities)
----------------

Robert C. Baird, Jr.
President
Avoca, Incorporated
228 St. Charles Avenue

Suite 838
New Orleans, Louisiana 70130
(504) 552-4720
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of Persons Filing Statement)
----------------

with copies to:

Charles A. Snyder, Esq.
Milling Benson Woodward L.L.P.
909 Poydras Street
Suite 2300
New Orleans, Louisiana 70112
(504) 569-7230
----------------

This Statement is filed in connection with (check the appropriate box):

a. X The filing of solicitation materials or an information statement
--- subject to Regulation 14A (ss.ss. 240.14a-1 through 240.14b-2),
Regulation 14C (ss.ss. 240.14c-101_, or Rule 13e-3(c) (ss.
240.13e-3(c)) under the Securities Exchange Act of 1934.
b. The filing of a registration statement under the Securities Act of
--- 1933.
c. A tender offer.
---
d. None of the above.
---

Check the following box if the soliciting materials or information statement
referred to in checking box (a) are preliminary copies. X
---

Check the following box if the filing is a final amendment reporting the results
of the transaction.
---

---------------

CALCULATION OF FILING FEE

Amount of
Transaction Value* Filing Fee**
------------------ -------------

$ 18,801,750 $ 2,382.19

* For purposes of calculating filing fee only. This amount assumes that
approximately 21,000 of Avoca's 830,500 outstanding shares will be repurchased
at a rate of $28.00 in lieu of issuing fractional shares. This amount also
assumes the remaining 809,500 shares for which new stock will be issued are
valued at the market rate as of August 11, 2004 of $22.50. The aggregate
transaction value is the sum of both the repurchased share value and reissued
share value.
** The amount of the filing fee is calculated in accordance with Fee Rate
Advisory #7 for Fiscal Year 2004 issued by the U.S. Securities and Exchange
Commission on January 26, 2004, by multiplying the transaction value by
..00012670.

X Check box if any part of the fee is offset as provided by Section
--- 240.11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number of the Form or Schedule and the date of its filing

Amount previously paid: $2,382.19
Form or Registration No.: 13E-3
Filing Party: Avoca, Incorporated
Date Filed: August 13, 2004

- --------------------------------------------------------------------------------

INTRODUCTION

This Amendment No. 1 amends and supplements the Rule 13e-3 Transaction
Statement on Schedule 13E-3 ("Schedule 13E-3") filed with the Securities and
Exchange on August 13, 2004, by Avoca, Incorporated, a Louisiana corporation
("the Company"), pursuant to Section 13(e) of the Securities Exchange Act of
1934, as amended ("Exchange Act"), and Rule 13e-3 thereunder. The Company is
submitting to its stockholders a proposal to approve and adopt:

(a) a 100-for-1 reverse stock split of the Company's no par value common
stock ("Stock"); and

(b) a cash payment of $28.00 per pre-split share, in lieu of issuance of
fractional shares, to beneficial stockholders owning fractional shares
after the reverse stock split.

Items (a) and (b) will be considered one proposal (the "Split Transaction").

This Amendment No. 1 to Schedule 13E-3 is being filed with the Securities
and Exchange Commission along with a revised preliminary proxy statement,
including annexes, filed by the Company pursuant to Regulation 14A under the
Exchange Act ("Proxy Statement"), which will notify stockholders of a special
meeting of Company stockholders, scheduled for , 2004, where
stockholders will be asked to approve the Split Transaction and conduct any
other business properly brought before the special meeting.

The following Cross-Reference Sheet is being supplied pursuant to General
Instruction F to Schedule 13E-3 and provides the location in the Proxy Statement
of all information required to be included therein. A copy of the Proxy
Statement is included as Exhibit (a) to this Schedule 13E-3. All information
contained in the Proxy Statement is expressly incorporated herein by reference,
and the responses to each item are qualified in their entirety by reference to
the information contained in the Proxy Statement. As of the filing date of this
Amendment No. 1 to Schedule 13E-3, the Proxy Statement is in preliminary form
and is subject to completion or amendment. This Amendment No. 1 to Schedule
13E-3 will be amended to reflect any such changes.

Except as set forth below, the information set forth in the Schedule 13E-3
remains unchanged.

Item 1. Summary Term Sheet

The information set forth in the Proxy Statement under the caption
"SUMMARY TERM SHEET" is incorporated herein by reference.

Item 2. Subject Company Information.

(a) Name and Address.

The name of the subject company is Avoca, Incorporated. The
Company is a Louisiana corporation with its principal executive
offices located at 228 St. Charles Avenue, Suite 838, New Orleans,
Louisiana 70130. The Company's telephone number is (504) 552-4720.

(b) Securities.

The information set forth in the Proxy Statement under the
captions "VOTING SECURITIES" and "BACKGROUND, PURPOSE, STRUCTURE
AND EFFECT OF THE SPLIT TRANSACTION -- Effect of Split Transaction
on Avoca" is herein incorporated by reference.

The Company's common stock is traded on the OTC Bulletin Board.
The trading symbol is "AVOC.OB." The following table lists the
high and low sales prices for the Company's common stock as quoted
on the OTC Bulletin Board for the periods indicated.

High Low
------------------------
Fiscal Year Ending December 31, 2004
- ------------------------------------
First Quarter $22.50 $19.50
Second Quarter 25.00 21.75
Fiscal Year Ending December 31, 2003
- ------------------------------------
First Quarter $21.00 $18.50
Second Quarter 20.00 17.60
Third Quarter 21.00 18.80
Fourth Quarter 20.00 19.51
Fiscal Year Ending December 31, 2002
- ------------------------------------
First Quarter $24.50 $22.20
Second Quarter 25.10 19.25
Third Quarter 20.95 17.00
Fourth Quarter 19.00 16.01

Information for the periods referenced above has been
furnished by the OTC Bulletin Board. Quotations reflect
inter-dealer prices, without retail mark-up, mark-down or
commission and may not represent actual transactions.

(d) Dividends. On December 18, 2003, the Company declared an annual
dividend of $2.85 per share, payable January 22, 2004 to
shareholders of record January 7, 2004. On December 11, 2002,the
Company declared an annual dividend of $1.75 per share, payable
January 22, 2003, to shareholders of record January 7, 2003.

(e) Prior Public Offerings. Not Applicable.

(f) Prior Stock Purchases. Not Applicable.

Item 3. Identity and Background of Filing Person.

(a) Name and Address.

The filing person, the Company, is also the subject company. The
Company's address and telephone number are provided in Item 2
above. The executive officers and directors of the Company are set
forth below.

Robert C. Baird, Jr., President , Director
J. Scott Tucker, Vice President, Director
M. Cleland Powell, III, Secretary-Treasurer, Director
Bernard E. Boudreaux, Jr. Director
John P. (Jack) Laborde, Director

The address of each director and executive officer of the Company
is c/o Avoca, Incorporated, 228 St. Charles Avenue, Suite 838, New
Orleans, Louisiana 70130.

(b) Business and Background of Entities Other than the Company.

Not applicable.

The information regarding the background of the Company's
directors and executive officers, pursuant to General Instruction
C to Schedule 13E-3, is set forth under the heading "Information
and Security Ownership of Management and Certain Beneficial
Owners" in the Proxy Statement and is incorporated herein by
reference.

During the last five years, neither the Company nor, to its
knowledge, any of the directors or executive officers of the
Company was a party to any judicial or administrative proceeding
(except for matters that were dismissed without sanction or
settlement) that resulted in a judgment, decree or final order
enjoining such person from further violations of, or prohibiting
activities subject to, federal or state securities laws or finding
any violation of those laws.

Item 4. Terms of the Transaction.

(a)(1) Tender Offers. Not applicable.

(a)(2) Mergers or Similar Transactions.

(i) Transaction Description. The information set forth in the Proxy
Statement under the caption "SUMMARY TERM SHEET" is incorporated
herein by reference.

(ii) Consideration. The information set forth in the Proxy Statement
under the captions "SUMMARY TERM SHEET" and "Background, Purpose,
Structure and Effect of Split Transaction -- Cash Payment in Lieu
of Shares of Common Stock" is incorporated herein by reference.

(iii) Reasons for the Transaction. The information set forth in the
Proxy Statement under the captions "SUMMARY TERM SHEET,"
"Background, Purpose, Structure and Effect of Split Transaction --
Background," "-- Purpose and Reasons for Split Transaction" and
"-- Factors Considered by the Board of Directors" is incorporated
herein by reference.

(iv) Vote Required for Approval. The information set forth in the Proxy
Statement under the captions "SUMMARY TERM SHEET" and "Vote
Required" is incorporated herein by reference.

(v) Differences in the Rights of Security Holders. The information set
forth in the Proxy Statement under the captions "SUMMARY TERM
SHEET," "Background, Purpose, Structure and Effect of Split
Transaction -- Structure of the Split Transaction and Effect on
Avoca's Stockholders," "-- Conversion of Shares in Split
Transaction" and "-- Effect of the Split Transaction on
Affiliates" is incorporated herein by reference

(vi) Accounting Treatment. Not Applicable.

(vii) Federal Income Tax. The information set forth in the Proxy
Statement under the caption "Background, Purpose, Structure and
Effect of the Split Transaction -- Material Federal Income Tax
Consequences" is incorporated herein by reference.

(c) Different Terms. The information set forth in the Proxy Statement
under the captions "SUMMARY TERM SHEET," "Background, Purpose,
Structure and Effect of the Split Transaction -- Structure of the
Split Transaction and Effect on Avoca's Stockholders," "--
Conversion of Shares in Split Transaction" and "-- Cash Payment in
Lieu of Shares of Common Stock" is incorporated herein by
reference.

(d) Appraisal Rights. The information set forth in the Proxy Statement
under the caption "Appraisal Rights" is incorporated herein by
reference.

(e) Provisions for Unaffiliated Security Holders. None.

(f) Eligibility for Listing or Trading. Not Applicable.

Item 5. Past Contacts, Transactions, Negotiations and Agreements.

(a) Transactions. Not Applicable.

(b) Significant Corporate Events. Not Applicable.

(e) Agreements Involving the Subject Company's Securities. Not
Applicable.

Item 6. Purposes of the Transaction and Plans or Proposals.

(b) Use of Securities Acquired. The information set forth in the Proxy
Statement under the captions "SUMMARY TERM SHEET," "Introduction,"
and "Background, Purpose, Structure and Effect of Split
Transaction" is herein incorporated by reference.

(c)(1)-(8) Plans. The information set forth in the Proxy Statement under the
captions "SUMMARY TERM SHEET," "Introduction," "Risk Factors,"
"Background, Purpose, Structure and Effect of the Split
Transaction," is incorporated herein by reference.

Item 7. Purposes, Alternatives, Reasons and Effects.

(a) Purposes. The information set forth in the Proxy Statement under
the captions "SUMMARY TERM SHEET," "Risk Factors," "Background,
Purpose, Structure and Effect of the Split Transaction -- Purpose
and Reasons for the Split Transaction," "-- Effect of Split
Transaction on Avoca," and "-- Certain Effects of the Split
Transaction" is herein incorporated by reference.

(b) Alternatives. The information set forth in the Proxy Statement
under the caption "Background, Purpose, Structure and Effect of
the Split Transaction -- Factors Considered by the Board of
Directors" is herein incorporated by reference.

(c) Reasons. The information set forth in the Proxy Statement under
the captions "SUMMARY TERM SHEET," "Risk Factors," "Background,
Purpose, Structure and Effect of the Split Transaction -- Purpose
and Reasons for the Split Transaction," "-- Factors Considered by
the Board of Directors" and "-- Effect of Split Transaction on
Avoca" is incorporated herein by reference.

(d) Effects. The information set forth in the Proxy Statement under
the caption "SUMMARY TERM SHEET," "Risk Factors," "Background,
Purpose, Structure and Effect of the Split Transaction--Purpose
and Reasons for the Split Transaction," "-- Factors Considered
by the Board of Directors," "--Source of Funds and Financial
Effect of the Split Transaction," "--Structure of the Split
Transaction and Effect on Avoca's Stockholders," "-- Conversion
of Shares in Split Transaction," "--Effect of Split Transaction
on Avoca," "--Effect of the Split Transaction on Affiliates,"
"--Cash Payment in Lieu of Shares of Common Stock," "--Conduct of
Avoca's Business After the Split Transaction," "-- Material
Federal Income Tax Consequences," and "Certain Effects of the
Split Transaction" is incorporated herein by reference.

Item 8. Fairness of the Transaction.

(a)-(b) Fairness; Factors Considered in Determining Fairness. The
information set forth in the Proxy Statement under the captions
"SUMMARY TERM SHEET," "Recommendation of the Board of Directors,"
"Background, Purpose, Structure and Effect of the Split
Transaction -- Factors Considered by the Board of Directors" and
"-- Opinion of Independent Financial Advisor" is incorporated
herein by reference.

(c) Approval of Security Holders. The information set forth in the
Proxy Statement under the captions "SUMMARY TERM SHEET" and "Vote
Required" is incorporated herein by reference.

(d) Unaffiliated Representative. The information set forth in the
Proxy Statement under the captions "SUMMARY TERM SHEET" and
"Background, Purpose, Structure and Effect of the Split
Transaction -- Factors Considered by the Board of Directors" and
"-- Opinion of Independent Financial Advisor" is incorporated
herein by reference.

(e) Approval of Directors. The information set forth in the Proxy
Statement under the captions "SUMMARY TERM SHEET" and
"Recommendation of the Board of Directors" is incorporated herein
by reference.

(f) Other Offers. Not Applicable.

Item 9. Reports, Opinions, Appraisals and Negotiations.

(a)-(c) Report, Opinion, or Appraisal; Preparer and Summary of the
Report, Opinion or Appraisal; Availability of Documents. The
information set forth in the Proxy Statement under the captions
"SUMMARY TERM SHEET," "Background, Purpose, Structure and Effect
of the Split Transaction -- Factors Considered by the Board of
Directors," "-- Opinion of Independent Financial Advisor," "--
Land and Mineral Appraisals," and the following Annex to the
Proxy Statement is incorporated herein by reference:

Annex B, "FAIRNESS OPINION"
-------

The presentation materials prepared by the independent financial
advisor for the Board of Directors dated August 10, 2004, as well
as the land and mineral appraisals prepared by Robert W, Merrick
Appraisal Division of Latter & Blum, Inc./Realtors and Collarini
& Associates, Inc., respectively, will be made available for
inspection and copying at the principal executive offices of the
Company during its regular business hours by any interested
stockholder or representative of a stockholder designated in
writing.

Item 10. Source and Amounts of Funds or Other Consideration.

(a)-(b) Source of Funds; Conditions. The information set forth in the
Proxy Statement under the captions "SUMMARY TERM SHEET,"
"Background, Purpose, Structure and Effect of the Split
Transaction -- Source of Funds and Financial Effect of the Split
Transaction," is incorporated herein by reference. Avoca has no
alternative financing arrangements or alternative financing plans
if the primary financing falls through.

(c) Expenses. The information set forth in the Proxy Statement under
the captions "SUMMARY TERM SHEET," "Background, Purpose,
Structure and Effect of the Split Transaction -- Source of Funds
and Financial Effect of the Split Transaction" and "-- Effect of
Split Transaction on Avoca" is incorporated herein by reference.

(d) Borrowed funds. None.

Item 11. Interest in Securities of the Subject Company.

(a) Securities Ownership. The information set forth in the Proxy
Statement under the caption "Information and Security Ownership
of Management and Certain Beneficial Owners" is incorporated
herein by reference.

(b) Securities Transactions. Not Applicable.

Item 12. The Solicitation or Recommendation.

(d) Intent to Tender or Vote in a Going-Private Transaction. The
information set forth in the Proxy Statement under the captions
"SUMMARY TERM SHEET," "Background, Purpose, Structure and Effect
of the Split Transaction -- Purpose and Reasons for the Split
Transaction" and "Vote Required" is incorporated herein by
reference.

(e) Recommendations of Others. The information set forth in the Proxy
Statement under the captions "SUMMARY TERM SHEET," "Introduction"
and "Recommendation of the Board of Directors" is incorporated
herein by reference.

Item 13. Financial Statements.

(a) Financial Information. The information set forth in the Company's
Annual Report on Form 10-KSB, for the fiscal year ended December
31, 2003, under the caption "Item 7-- Financial Statements" and
Quarterly Report on Form 10-QSB, for the fiscal quarter ended
June 30, 2004, under the caption "Item 1-- Financial Statements"
is incorporated herein by reference. Copies of the Financial
Statements are attached to the Proxy Statement as Annex D. The
information set forth in the Proxy Statement under the captions
"Background, Purpose, Structure and Effect of the Split
Transaction-- Factors Considered by the Board of Directors" and
"AVAILABLE INFORMATION" is incorporated herein by reference.

(b) Pro Forma Information. The information set forth in the Proxy
Statement under the caption "Background, Purpose, Structure and
Effect of the Split Transaction -- Effect of the Split
Transaction on Affiliates" is incorporated herein by reference.

Item 14. Persons/Assets, Retained, Employed, Compensated or Used.

(a)-(b) Solicitations or Recommendations; Employees and Corporate Assets.
The information set forth in the Proxy Statement under the
captions "INTRODUCTION," "SUMMARY TERM SHEET," "Background,
Purpose, Structure and Effect of the Split Transaction -- Factors
Considered by the Board of Directors," "-- Source of Funds and
Financial Effect of the Split Transaction" and "-- Opinion of
Independent Financial Advisor" is incorporated herein by
reference.

Item 15. Additional Information.

(b) Other Material Information. The information set forth in the Proxy
Statement and appendices thereto is incorporated herein by
reference.

Item 16. Exhibits.

Exhibit
Number Description
- ------- ---------------------------------------------------------------------

Preliminary Proxy Statement on Schedule 14A filed with the Securities
and Exchange Commission (a) on September , 2004 (incorporated
herein by reference).

(b) Not applicable.

(c) Fairness Opinion of Chaffe & Associates, Inc., dated August 10, 2004
(incorporated herein by reference to Annex B to the Proxy
Statement);

Chaffe & Associates, Inc.'s Report dated August 10, 2004;

Excerpts from Merrick's Appraisal Of The Fee Simple Interest In
Avoca's Property dated March 29, 2004;

Collarini & Associates, Inc.'s Appraisal Of The Mineral Interests
In Avoca's Property dated August 2, 2004

(d) Not applicable.

(f) Not applicable.

(g) Not applicable.

SIGNATURE

After due inquiry, and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.

Dated: September 24, 2004 AVOCA, INCORPORATED

By: /s/ Robert C. Baird, Jr.
-----------------------------
Robert C. Baird, Jr.
President

EXHIBIT INDEX

Exhibit
Number Description
- ------- ---------------------------------------------------------------------

Preliminary Proxy Statement on Schedule 14A filed with the Securities
and Exchange Commission (a) on September , 2004 (incorporated
herein by reference).

(b) Not applicable.

(c) Fairness Opinion of Chaffe & Associates, Inc., dated August 10, 2004
(incorporated herein by reference to Annex B to the Proxy
Statement);

Chaffe & Associates, Inc.'s Report dated August 10, 2004;

Excerpts from Merrick's Appraisal Of The Fee Simple Interest In
Avoca's Property dated March 29, 2004;

Collarini & Associates, Inc.'s Appraisal Of The Mineral Interests
In Avoca's Property dated August 2, 2004

(d) Not applicable.

(f) Not applicable.

(g) Not applicable.

CHAFFE & ASSOCIATES, INC.
Investment Bankers

Presentation to Board of Directors*

Avoca, Incorporated

August 10, 2004

*Corrected for typographical errors and an inaccuracy in Other Influencing
Factors.

Purpose

o Chaffe's assignment is being performed in connection with a reverse
split transaction that will result in Avoca, Incorporated becoming
private. The purpose of our engagement is to evaluate the adequacy and
fairness, from a financial point of view, of the price to be paid to
minority shareholders to purchase fractional shares.

Procedure

o Chaffe will independently find fair market value of the Avoca shares to
compare with the reported trading price of Avoca's shares on the OTC
bulletin board.

o Fair market value is defined as the price that would be paid for a
common share of the Company's stock, in cash, in an at-arm's-length
transaction between a knowledgeable and willing seller and buyer on the
valuation date.

o The fair market value will guide Chaffe in its determination of
fairness from a business and financial point of view.

Information used by Chaffe in Finding Value

o Audited Financial Statements of Avoca for the fiscal years ended
December 31, 1999 through 2003 along with the interim financial
statements for March 31, 2004 and a draft version of June 30, 2004.

o Articles of incorporation along with other corporate documents and
certain contracts including surface and mineral leases.

o Avoca's 52 week price and volume trading history.

o An independent appraisal of the land value of Avoca Island as prepared
by the Robert W. Merrick Appraisal Division of Latter and Blum.

o An independent appraisal of the mineral value of Avoca Island as
prepared by Collarini Associates. Chaffe also conducted interviews with
Mr. Dennis Jordan, P.E., President of Collarini Associates, relative to
their appraisal.

o Information for publicly traded companies used in our public peer group
was derived from SEC filings and certain statistical services including
Telescan and Standard & Poor's Compustat Database.

o Discussions with Avoca's management with respect to past and current
operations, financial condition and future prospects of Avoca.

Limitations of Chaffe Opinion

o Our opinion expresses no view toward the merits of the split
transaction as compared to any alternative business strategy.

o Our opinion does not consider tax consequences that may arise as a
result of the proposed transaction, nor does it consider investment
alternatives for affected shareholders.

o Chaffe expresses no opinion regarding the trading ranges at which
Avoca's stock may trade at any time.

o Our opinion considers only those facts and circumstances that were
known or knowable at the valuation date; therefore, our opinion is
subject to the following limitations:

o Chaffe accepted Avoca's audit reports and made no attempt to verify the
same.

o Chaffe accepted appraisals of land and mineral values and made no
attempt to verify the same.

o Chaffe relied on the assurance of Avoca's management that they are not
aware of any facts that would render information relied upon by Chaffe
to be inaccurate, incomplete or misleading.

o Chaffe has not evaluated the recent lease option sale and its impact on
future earnings.

Other Influencing Factors

o Chaffe notes that Avoca's shares are thinly traded and have been
trading within a somewhat narrow range over the last 52 weeks.

o The Avoca wells are mature, reserves have been declining, and the
estimated reserve life is approximately 4 years.

o Avoca's revenue and earnings have fluctuated substantially over the
past 5 years due to production variances and, to a lesser extent,
commodity prices.

o Avoca's production is derived from a small number of wells with the
majority from 1 well, Avoca 47-1.

o Recent attempts to drill new wells have not been successful.

o On August 9, 2004, Avoca received preliminary information that a lease
option on certain Avoca property may be assigned in the near future to
an oil and gas production company. This could result in the exercise of
the option, in whole or in part. If the option is exercised in whole,
Avoca could receive a lease bonus payment of $500,000, amounting to
$0.41/share after tax. Chaffe has not evaluated the effect of this
potential development on the proposed transaction.*

* Wording corrected to reflect the actual circumstances as of August 10, 2004.

Valuation Methodology

o Chaffe utilized the following valuation models to find value:

- Analysis of Price/ PV 10 Net Worth

- Analysis of dividend yield

- Liquidation value analysis

Public Peer Analysis

o Chaffe analyzed the pricing of publicly traded oil and gas royalty
trusts. The analysis compares the pricing of twelve companies as
indicated by prices in active trading of minority shares on public
stock markets.

o The peer companies were evaluated for similarity to Avoca in terms of
services provided, financial and operating characteristics,
particularly regarding revenue generation and recognition.

o Chaffe notes that the peer companies are all significantly larger than
Avoca and the majority have reserve lives in excess of the estimated
reserve life of Avoca as found by Collarini and Associates.

o Chaffe notes that the trusts with short reserve lives have lower
pricing multiples relative to trusts with longer reserve lives.
Therefore, the trusts with short reserve lives were treated as a subset
and their pricing multiples were used to price Avoca in addition to the
pricing multiples of the group as a whole.

o The peer companies are "pass through" entities so the income generated
is not taxed at the corporate level. Avoca is a C corp and income is
taxed at the corporate level. Adjustments are made to certain of
Avoca's financial information to account for this difference.

Public Peer Group - Pricing Multiples

August 6, 2004 Valuation
Last
4 Qtrs.
Price to Cash Last
Per Unit Per Unit Distri- TTM 4 Qtrs
Stock BV BV PV10 PV10 bution Dividend Price Earnings
Ticker Price of Royalty of Units Net Net Reserve Per Yield to Per Payout
Name Symbol 08/06/04 PV 10(1) Interests Equity Out. Worth Worth Life Unit (%) Earnings Unit Ratio

BP Prudhoe Bay
Royalty Trust BPT 36.51 395,318 13,558 14,295 21,400 18.51 197.27% 14 2.65 7.27% 13.66 2.67 99.26%
Cross Timbers
Royalty Trust CRT 30.96 93,855 24,243 24,243 6,000 15.64 197.92% 9 2.17 7.01% 14.14 2.19 99.14%
Dominion Res
Black Warrior DOM 33.09 117,284 43,365 43,362 7,850 14.94 221.48% 8 2.47 7.46% 13.40 2.47 100.00%
Eastern Amer
Natural Gas TR(3) NGT 21.08 56,449 33,704 33,919 5,900 9.60 219.49% 11 1.87 8.85% 11.06 1.91 97.90%
LL&E Royalty Trust LRT 5.34 38,811 1,862 1,863 18,991 2.04 261.30% 12 0.51 9.46% 10.57 0.51 100.06%
Mesa Royalty Trust MTR 62.00 91,762 9,410 9,410 1,864 49.24 125.92% 22 5.02 8.09% 12.35 5.02 100.00%
Permian Basin
Royalty Trust PBT 9.98 175,551 1,947 1,947 46,609 3.77 264.97% 9 0.74 7.39% 13.53 0.74 100.00%
Sabine Royalty
Trust(4) SBR 36.50 168,807 1,264 1,264 14,579 11.58 315.24% 8 2.70 7.40% 13.42 2.72 99.30%
San Juan Basin
Royalty Trust SJT 25.98 497,701 29,131 29,131 46,609 10.68 243.30% 9 1.96 7.56% 13.23 1.96 100.00%
Santa Fe Energy
Trust(3) SFF 12.23 59,093 9,241 9,303 6,300 9.39 130.25% 4 2.82 23.05% 4.34 2.82 100.00%
TEL Offshore Trust TELOZ.O 5.79 20,476 141 141 4,752 4.31 134.36% 5 0.74 12.86% 7.78 0.74 100.00%
Torch Energy
Royalty Trust TRU 6.22 37,172 25,629 25,444 8,600 4.30 144.62% 5 0.79 12.70% 7.87 0.79 100.00%
Mean 204.68% 9.93% 11.28 99.64%

Median 92,809 11,484 11,853 208.71% 9 7.83% 12.79 100.00%
Maximum 497,701 43,365 43,362 315.24% 22 23.05% 14.14 100.06%

Minimum 20,476 141 141 125.92% 4 7.01% 4.34 97.90%
Mean (Short
Reserve Life) 136.41% 16.20% 6.66 100.00%

Median (Short
Reserve Life) 37,172 9,241 9,303 134.36% 5 12.86% 7.78 100.00%
Avoca(2) AVOC 22.00 6,751 0 4,882 830.5 14.01 157.06% 4 2.85 12.95% 5.99 3.67 90.00%

Note: Cross Timbers based on data through June 2004 filed in 10Q, all others have not filed 10Q.
(1) Proved producing reserves.
(2) Avoca internal financials through June 2004. PV10 and reserve life verbal per Collarini. Avoca pays dividends
once per year therefore payout implied based on historic performance.
(3) Each unit holder owns zero coupon treasury securities. Unit price adjusted to reflect value of royalty trust only:
Eastern American - $18.3 million, Santa Fe $112.5 million.
(4) Book value adjusted to remove excess cash balance of $3.8 million.

Range of Value - Avoca

Chaffe's Range of Value $21,593,000 $24,915,000
Per Share $26.00 $30.00

Avoca's market price @ 8/6/04 = $22.00
Premium over 8/6/04 price 18.18% 36.36%

Avoca's 52 week trading range
Premium over 52 week high ($25.00/share) 4.00% 20.00%
Premium over 52 week low ($18.80/share) 38.30% 59.57%

Value Indication - Price/PV10 Net Worth

Price/PV10 Net Worth

PROPERTY AT MARKET VALUE(1):
PV10 Value of Proved Producing Royalty Interests 6,751,200
Value of Land Per Appraisal 2,485,000

PV10 Value of Proved Producing Royalty Interests (after tax) 4,658,812
Value of Land (after tax) 1,664,783
---------

Market Value 6,323,595

Other Assets (Excluding Cash and Marketable Securities) 521,350
Less: Liabilities (66,757)
---------
Net Asset Value (Excluding Cash & Investments) 6,778,188

All Trusts Short Reserve Life
---------- ------------------

Median Price/PV10 Net Worth 208.71% 134.36%

Marketable, Min. Value $14,146,507 $9,107,070
Less: Size Discount (All Trusts 20%, Short Reserve 15%) (2,829,301) (1,366,061)
Add: Cash and Marketable Securities(2) 4,285,785 4,285,785
----------- -----------

$15,602,991 $12,026,795
=========== ===========

Per share(3) $18.79 $14.48

(1) Underlying assets - PV10- production $6.751MM and land $2.485 both taxed on gain from book value at current Avoca tax rate.
(2) Securities marked to market value as of June 30, 2004.
(3) Total shares outstanding 830,500.

Value Indication - Dividend Yield

DIVIDEND YIELD

Trailing twelve months pre-tax earnings for the period ended 6/30/04 4,425,088
Less taxes: Tax Rate(1) 30.99% 1,371,460
------------

Net Income 3,053,628

Assuming company pays out 90% of its net income as dividends.
Implied trailing twelve months dividend (distribution) for the period ended 6/30/04 2,748,265

Median Dividend Yield (All Trusts) 7.83%

Market Value of Company as Royalty Trust $35,110,388
Less: Size Discount 20% (7,022,078)
Add: Cash and Marketable Securities 4,285,785
Add: Value of Land (after tax) 1,664,783
------------
Market Value $34,038,878
============
Per Share(2) $40.99

Median Dividend Yield (Short Reserve) 12.86%

Market Value of Company as Royalty Trust $21,373,477
Less: Size Discount 15% (3,206,022)
Add: Cash and Marketable Securities 4,285,785
Add: Value of Land (after tax) 1,664,783
------------
Market Value $24,118,023
============
Per Share(2) $29.04

(1) Actual for the trailing twelve month period ending 3/31/04
(2) Total shares outstanding 830,500

Value Indication - Liquidation Analysis*

Market Value of Mineral Interests (Collarini Appraisal(1)) 5,800,000
Market Value of Land (Merrick Appraisal) 2,485,000
Less: Costs & Commissions 6.00% (497,100)
----------

Proceeds from sale of properties net of costs 7,787,900
Less: Taxable Basis (BV of total assets) (72,522)
----------

Gain 7,715,378
Less: Tax on gain 30.99% (2,391,214)
-----------

Net Proceeds from sale of Properties 5,396,686

Other Assets (Excluding Prepaid Expenses) 466,851
Less: liquidation costs 0.00% 0
----------

Net Proceeds from other assets 466,851

Cash & Marketable Securities(2) 4,285,785
-----------

Total Proceeds from Assets 10,149,322
Less: Liabilities (66,757)
-----------

Liquidation Value 10,082,565

Per Share(3) $12.14

(1) Based on 90% of the net present value of the proved producing reserves discounted at 15%. No value attributed to
undeveloped reserves and behind pipe potential. Commodity pricing - Nymex 5/5/2004.
(2) Securities marked to market value as of June 30, 2004.
(3) Total shares outstanding 830,500.

*Analysis corrected to reflect typographical error, which was discussed with the
Avoca board of directors during the August 10, 2004 meeting. The correction
caused an increase in the per share value of $0.09 to the $12.14 value per share
shown above.

Valuation Summary

Equity Value $/Share
------------ -------
Price/PV10 Net Worth (All Peers) $15,602,991 $18.79
Prive/PV10 Net Worth (Short Reserve) $12,026,795 $14.48

Dividend Yield Analysis (All Peers) $34,038,878 $40.99
Dividend Yield Analysis (Short Reserve) $24,118,023 $29.04

Liquidation Analysis (Collarini/Merrick) $10,082,565 $12.14*

*Revised to show the corrected value indication.

Public Peer Group - Descriptions

Ticker Property Wells Production Reserve
Name Symbol Acres Drilled Trend Trend Make up Notes

BP Prudhoe
Bay Royalty
Trust BPT 150,000 Product 2,109 6.6%-5 yrs Increasing 3.2% Oil-medium Termination on or
acres 29% year over year Ann. grade before 12/31/10 on
Alaska low sulphur voting of 70% hdr.
crude or after net
revenues<$1mm for 2
successive years
except for force
majeure. Estimated
royalties will end
after 2018.
Cross Timbers
Royalty Trust CRT 60,000 gross 30 Oil 5.2% decline-3yrs Oil-5.2% dec Oil/Gas Terminates with
(San Juan Basin) Gas 3.0% decline-3 yrs Gas 2.1% dec vote of 80% or
(NM) & (TX) 3% yoy 4 yrs gross revenue <$1
mm for 2 successive
years.
Dominion Res
Black Warrior DOM 34,212 (AL) 532 10% decline 99% dec N/G Terminates with 66%
3 yrs vote ratio of cash
2% yoy received/cost is <
1.2 to 1.0 for 2
quarters, PV10<$5
mm. Co has right of
1st refusal to
purchase assets at
105%>then tendered
all cash offer.
Management believes
wells are past
prime.
Eastern Amer
Natural Gas TR* NGT N/A 677 4.6% Ann 0.5% dec 3yrs N/G Trust terminates
Net profits May 2013 (trustee
interest (W/VA)&(Penn) dec 3 yrs 10.1% inc yoy Stable Prod. must liquidate
Characteristics trust after 5/15/12
long economic & before 5/15/13.
life Each holder owns
treasury,obligation
at $20/unit
(closing price
$658/$1000 face
value at 12/03).
(Cost of treasuries
$27,788mm).
LL&E Royalty
Trust LRT 67,108 36 oil Oil 37% decline-3yrs 24% dec 3 yrs Oil & Gas Terminates if net
(LA)(FL) 32 gas Gas back up after Working over revenues fall below
workover Jay $5mm for 2
(Nitrogen) successive years
sidetracked (2002 rev $2.2mm).
Jay field is
largest producing-
when workover
completed, mgt.
believes that the
property will pay
out well. (62,150
acres, 30 wells)
Mesa Royalty
Trust MTR 99,413(KS) 466 (KS) Gas 4.4% decline-3yrs dec (6.1%) Gas/Condensate Terminate if
31,328 (NM, CO) 466 (NM)(CO) Oil 4.4% decline-3yrs inc 2.1% NG Liquids majority approves,
130,741 Total 932 Total yoy inc 6.4% if royalty income
<$250k for 2
successive yrs
Permian Basin
Royalty Trust PBT 33,246 544 Oil 9.4% decline-3yrs Oil 12% dec. Oil & Gas No termination date
(TX) Gas 6.6% decline-3yrs Gas 9% dec listed.
Sabine Royalty
Trust SBR 216,551 N/A Oil 2.44% decline-3yrs Oil 7.8% yoy Oil & Gas Termination - if
(FL, LA, MS, NM, Gas stable product Gas 2% yoy revenue <$2mm for 2
OK, TX) successive yrs or
vote of holders.
San Juan Basin
Royalty Trust SJT 119,000 1.170 Oil slight increase Oil 15% dec Oil & Gas No stated
(NM) Gas 10% increase Gas 12.1% yoy (Gas mostly) termination date.
Continued
development of
formation/58 new
wells 2003.
Santa Fe
Energy Trust SFF 7,840 300 Oil slight increase Oil 18.5% dec Oil & Gas Trust terminates
(12 states 70% (wells in tertiary Gas 7.6% dec (Gas mostly) 12/31/07. Trust
TX, OK, LA & operations) 3 yrs holds (zero
LA offshore) Gas 6.8% decline coupon) treasury
obligations with
face value of $126
mm maturing 2/15/08
TEL Offshore
Trust TELOZ.OB 78,747 (offshore 113 Oil Oil 24% increase-3 yrs Oil 14% inc Oil & Gas Termination: if
LA) 105 Gas Gas 2.3% decline-3yrs Gas 1.4% inc (mostly oil) PV10<$2mm or
218 Total yoy majority of unit
holders.
Torch Energy
Royalty Trust TRU 23,651 8 oil Oil 7.0% decline-3yrs Oil 7% dec-3yrs Gas Terminates March 1
(LA & TX) 197 Gas Gas 6.3% decline-3yrs Gas 6.4%dec-3yrs (little oil) of year when PV10<
205 Total $25MM, unless Henry
Hub spot price at
12/31/04 exceeds
$4.50 MMbtu-the
trust will
terminate March 1,
2005.

*Net profits interest (NPI)-Net proceeds from gas until May 15, 2013 or 41,683 mmcf produced.
**Terminates March 1 of year when 19/10 <$25mm.

Table of Contents

Agenda and Purpose in Finding Value 3
Limitations of Chaffe's Opinion 4
Information used by Chaffe in Finding Value 5
Other Factors Influencing Value 6
Valuation Methodology 7
Summary of Values 8
Public Peer Analysis 9
Public Peer Descriptions 10
Price/ PV 10 Net Worth Analysis 11
Value Indication PV 10 Net Worth 12
Dividend Yield Analysis 13
Value Indication Dividend Yield 14
Liquidation Analysis 15
Value Indication Liquidation Analysis 16
Table Exhibit 17

APPRAISAL

OF THE

MARKET VALUE

OF THE

FEE SIMPLE INTEREST

Avoca Island
St. Mary Parish, Louisiana

FOR

Mr. Robert C. Baird, Jr.
Director and President
AVOCA Incorporated
228 St. Charles Avenue, Suite 838
New Orleans, Louisiana 70130

Patrick J. Egan, CRE
Robert W. Merrick Appraisal Division of
Latter & Blum, Inc./Realtors
800 Common Street, Suite 1000
New Orleans, Louisiana 70112-2338

March 29, 2004 Our File No. 04-15

Mr. Robert C. Baird, Jr.
Director and President
AVOCA Incorporated
228 St. Charles Avenue, Suite 838
New Orleans, Louisiana 70130

Re: Avoca Island
St. Mary Parish, Louisiana

Dear Mr. Baird:

In response to your request and engagement letter dated February 10, 2004,
prepared on behalf of AVOCA Incorporated by Mr. Paul Hogan, III, General
Manager, I herewith submit my appraisal report of the estimated market value of
the fee simple interest in Avoca Island. The subject of this report is
approximately 16,000 acres of marshland and low-lying pastureland on the
opposite bank of Bayou Boeuf from Morgan City, Louisiana in St. Mary Parish. The
subject property is commonly referred to as AVOCA Island and will be more fully
described within the body of this report. My findings are presented in an
abbreviated format and this document constitutes a Summary Appraisal Report;
this report sets forth the appraiser's conclusions and data and analysis
critical to the determination of market value, as defined. Any supporting data
not provided herein but considered pertinent to the analysis is retained on
file.

This is a Summary Appraisal Report which is intended to comply with the
reporting requirements set forth under Standards Rule 2-2(c) of the Uniform
Standards of Professional Appraisal Practice for a Summary Appraisal Report. As
such, a complete discussion of the data, reasoning and analyses that have been
used in the appraisal process to develop the estimate of market value, have not
been included within the report. The report presents only the conclusion of
value and any critical analysis.

Purpose of the Report
The purpose of this report is to estimate the market value of the surface rights
in the subject property, as identified. Market Value, as used herein, is defined
as: "The most probable price which a property should bring in a competitive and
open market under all conditions requisite to a fair sale, the buyer and seller
each acting prudently and knowledgeably, and assuming the price is not affected
by undue stimulus." United States Treasury Department, Office of Comptroller of
the Currency, 12 CFR Part 34, Subpart C, ss. 34.42(f), 08/24/90.

Property Rights Appraised
This report is made assuming fee simple title to the subject property. Fee
Simple, as used herein, is defined as: "An absolute fee; a fee without
limitations to any particular class of heirs or restrictions, but subject to the
limitations of eminent domain, escheat, police power, and taxation. An
inheritable estate."

The value reported is for the surface rights only without consideration of the
value, if any, of the minerals.

Function of the Report
This appraisal has been prepared for the internal use of the client, Avoca
Incorporated.

Date of Valuation
March 25, 2004

Appraisal Development and Reporting Process
In preparing the appraisal, the subject property was inspected on March 25,
2004. The property was inspected by car and from an airboat. Comparable sales
and market information was researched.

In developing an opinion of value, the complete appraisal process, as defined by
the Uniform Standards of Professional Practice, was performed; no departure
provisions from Standard 1 were invoked. This Summary Appraisal Report present
the appraiser's conclusion and relevant supporting data and analyses. Supporting
documentation not included within the report proper is retained in work files.

All three approaches to value (Cost, Sales Comparison and Income Capitalization)
were considered, however, the subject is wooded and open marshland and low-lying
pastureland generally with few permanent physical structures. As such, the Cost
Approach and Income Approach to Value are not readily applicable. The Sales
Comparison Approach to Value, which will analyze sales of similar bulk tracts of
southeast Louisiana marshland, is considered the most reliable appraisal
methodology in this particular application.

In completing the appraisal assignment, the appraiser contacted various brokers,
investors and realtors familiar with the property type being appraised. Relevant
market data (sales and current listings) were gathered, all available sources
including courthouse records, the assessor's office and real estate data
services (Deedfax, etc.). The supply and demand characteristics in the market
were also analyzed and related to the subject property. This information was
then correlated to help establish appropriate value parameters for the subject
property.

Client/Ownership of Record
AVOCA Incorporated

[Pages 3-61 of the Appraisal Report, consisting of the Property Description,
Synopsis of the Subject Surface Leases, St. Mary Parish Area Analysis,Site
Analysis, and Comparable Land Sales are available from Avoca. Please see Proxy
Statement, Available Information for details.]

- ------------------------------------------------------------------------------------------------------------------------------------
Synopsis of Large Acreage Wetland Sales
- ------------------------------------------------------------------------------------------------------------------------------------
Sale Area Price
Number Date Consideration Purchaser (Acres) Per Acre Location Remarks
- ------------------------------------------------------------------------------------------------------------------------------------

1 1/26/1984 $1,737,645 Public 6,097 $285.00 St. Tammany Parish Grassy marsh, predominately
with some wooded areas
adjacent to rivers.
Adjoins Sale 2.
- ------------------------------------------------------------------------------------------------------------------------------------
2 9/4/1985 $538,365 Public 1,889 $285.00 St. Tammany Parish Partially wooded swamp,
grassy marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
3 12/30/1986 $2,582,185 Public 15,960.32 $162.00 Ascension, Livingston Numerous non-contiguous
and St. Tammany tracts ranging from marshland
Parishes to hardwood bottomland.
- ------------------------------------------------------------------------------------------------------------------------------------
4 11/24/1987 $384,000 Private 1,280 $300.00 Terrebonne Parish Brackish marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
5 10/28/1988 $850,000 Public 1,810 $469.00 Cameron Parish Former hunt club with
improvements; part highland,
marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
6 12/29/1988 $4,090,650 Public 8,100 $505.00 Cameron Parish 800 acres former rice land;
with 40 acres highway
commercial, balance
freshwater marshland.
- ------------------------------------------------------------------------------------------------------------------------------------
7 9/26/1989 $586,041 Public 1,787 $328.00 Terrebonne Parish 37% farmland; marsh and wet
woodland. See Resale No. 9.
- ------------------------------------------------------------------------------------------------------------------------------------
8 4/25/1990 $7,750,000 Public 18,000 $430.00 Orleans Parish Primarily brackish and
freshwater marsh; 2/3 within
levee system. Some highway
frontage.
- ------------------------------------------------------------------------------------------------------------------------------------
9 Jul-90 $766,266 Public 1,787 $428.80 Terrebonne Parish 37% farmland; balance marsh
and wet woodland - see
original Sale No. 7.
- ------------------------------------------------------------------------------------------------------------------------------------
10 5/29/1991 $13,785,436 Private 61,500 $224.00 Ascension, St. James Three parcels of
and St. John the predominately wet treeland
Baptist parishes along the south shore of Lake
Maurepas.
- ------------------------------------------------------------------------------------------------------------------------------------
11 7/17/1991 $350,000 Private 7,000-8,000 $44.00-$50.00 Ascension & Livingston Multiple small parcels of wet
Parishes treeland.
- ------------------------------------------------------------------------------------------------------------------------------------
12 9/4/1991 $771,572 Public 1,929 $400.00 St. Tammany Wooded swamp and grassy marsh
adjacent to Bogue Chitto
Wildlife Refuge.
- ------------------------------------------------------------------------------------------------------------------------------------
13 4/28/1992 $421,108 Public 1,662 $247.00 St. Tammany Southern end of Bogue Chitto
Wildlife; swampland and
bottomland hardwood.
- ------------------------------------------------------------------------------------------------------------------------------------
14 5/19/1992 $172,835 Private +/-1,023.56 $168.85 Terrebonne Parish Freshwater swamp and farmland
on Houma Navigation Canal.
- ------------------------------------------------------------------------------------------------------------------------------------
15 6/23/1992 $1,696,340 Public 7,002.56 $242.28 Terrebonne Parish Freshwater marsh/swampland
southwest of Houma.
- ------------------------------------------------------------------------------------------------------------------------------------
16 Oct-92 $1,130,624 Public 4,618 $244.83 Terrebonne Parish Freshwater marsh/swampland
southwest of Houma.
- ------------------------------------------------------------------------------------------------------------------------------------
17 3/26/1993 $250,000 Private 1,280 $195.00 Terrebonne Parish Brackish marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
18 1/19/1994 $2,044,500 Private +/-9,300 $220.00 Livingston Parish Bald cypress; water tupelo
swampland.
- ------------------------------------------------------------------------------------------------------------------------------------
19 12/28/1994 $2,300,000 Private 19,059 $120.68 Lafourche, Terrebonne Farmland and wet treeland.
- ------------------------------------------------------------------------------------------------------------------------------------
20 6/28/1995 $513,000 Private 4,400 $116.60 St. Bernard Parish High wooded land; 72%
wetlands.
- ------------------------------------------------------------------------------------------------------------------------------------
21 7/13/1995 $400,000 Private 5,616.46 $71.22 St. John the Baptist Wet wooded land and swamps.
Parish
- ------------------------------------------------------------------------------------------------------------------------------------
22 7/3/1995 $203,000 Private 2,198.41 $92.34 Lafourche Parish Mostly wet treeland and
marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
23 7/25/1995 $100,000 Public 2,839.12 $35.22 Assumption Parish 20% high; balance swamps.
- ------------------------------------------------------------------------------------------------------------------------------------
24 7/25/1995 $100,000 Public 786.44 $127.15 Lafourche Parish Open pasture and marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
25 9/20/1995 $1,210,000 Private 4,516.77 $267.89 St. Charles Parish Pasture, wooded land and
marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
26 4/22/1996 $500,000 Private 4,900 $103.09 Plaquemines/Jefferson 100% Wetlands
Parishes
- ------------------------------------------------------------------------------------------------------------------------------------
27 5/23/1996 $300,000 Private 800 $375.00 Terrebonne Parish Pasture and prairie marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
28 9/24/1996 $17,500 Private 900 $100.00 St. Mary Parish Net treeland; multiple
tracts.
- ------------------------------------------------------------------------------------------------------------------------------------

29 Dec-96 $22,500 Private 1,423 $15.81 Plaquemines Parish Primarily water bottoms,
publicly accessed.
- ------------------------------------------------------------------------------------------------------------------------------------
30 9/9/1997 $1,312,692 Private 35,163 $293.48 Lafourche Parish Primarily water bottoms.
- ------------------------------------------------------------------------------------------------------------------------------------
31 11/7/1997 $930,000 Private 2,958.9 $314.31 St. John the Baptist Wooded wetlands, swamp and
Parish marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
32 11/11/1997 $90,000 Private 900 $100.00 Lafourche Parish Flooded marsh/swampland.
- ------------------------------------------------------------------------------------------------------------------------------------
33 1/1/1998 $3,000,000 Public 24,320 $123.35 Lafourche Parish Fresh water marsh.
4/4/2000 $3,000,000 25,000 $120.00
- ------------------------------------------------------------------------------------------------------------------------------------
34 1/13/1999 $299,495 Public 1,795.31 $167.00 St. Mary Parish Partially wooded, swamp land.
- ------------------------------------------------------------------------------------------------------------------------------------
35 5/21/1999 $250,000 Private 1,123.8 $223.00 Terrebonne Parish Wooded wetlands.
- ------------------------------------------------------------------------------------------------------------------------------------
36 6/2/1999 $13,000 Private 127.65 $102.00 St. Mary Parish Partially wooded wetlands.
- ------------------------------------------------------------------------------------------------------------------------------------
37 4/20/2000 $400,000 Private 1,479 $270.45 St. Bernard Parish Spoil servitude; brackish
marsh.
- ------------------------------------------------------------------------------------------------------------------------------------
38 12/7/2000 $310,500 Private 103.5 $3,000.00 Lafourche Parish Upland range with a mix of
cleared pastureland or
drained woodlands. (Adjoins
Sale 44)
- ------------------------------------------------------------------------------------------------------------------------------------
39 10/4/2001 $3,500,000 Private 3,096.2 $1,130.42 St. Charles Parish Upland range with forested
Palustrine wetlands.
- ------------------------------------------------------------------------------------------------------------------------------------
40 10/24/2001 $1,000,000 Private 1,714.66 $583.20 St. Charles Parish Upland range and forested.
- ------------------------------------------------------------------------------------------------------------------------------------
41 10/30/2001 $370,163.46 Private 668.55 $553.68 Lafourche Parish Freshwater wetlands and
wooded swamp. (Adjoins Sale
42)
- ------------------------------------------------------------------------------------------------------------------------------------
42 10/30/2001 $238,691.54 Private 397.75 $600.00 Lafourche Parish Freshwater wetlands and
wooded swamp. (Adjoins Sale
41)
- ------------------------------------------------------------------------------------------------------------------------------------
43 11/20/2001 $2,673,165 Private 2,430.15 $1,100.00 Lafourche Parish Raphael Project; balance of
site includes low-lying marsh
and pasture with low-lying
wooded lands interspersed.
- ------------------------------------------------------------------------------------------------------------------------------------
44 1/29/2002 $2,100,000 Private 1,250.4 $1,679.46 Lafourche Parish Upland range with forested
Palustrine wetlands.
(Adjoins Sale 38)
- ------------------------------------------------------------------------------------------------------------------------------------
45 5/20/2003 $1,608,000 Private 7,481 $215.00 St. James Parish Wooded swampland.
- ------------------------------------------------------------------------------------------------------------------------------------
46 5/28/2003 $60,000 Private 680 $176.47 Lafourche Parish Coastal marsh in area north
of Delta Farms.
- ------------------------------------------------------------------------------------------------------------------------------------
47 9/2/2003 $120,956 Private 302.39 $400.00 Lafourche Parish Estuarine inter-tidal
wetlands
- ------------------------------------------------------------------------------------------------------------------------------------

Valuation
Research has been conducted throughout Southeast Louisiana to identify sales of
bulk acreage that included land types similar to the subject properties. The
sales identified occurred over a seventeen-year period beginning in 1984. While
sales that dated are typically not applicable in establishing current value
estimate, the history of sales does provide some insight into transaction volume
and price movement for this rather unique real estate asset class. The sales are
also useful in identifying the source of demand for wetlands given their
somewhat limited economic utility.

There is an almost unlimited supply of wetlands along the coastal areas of South
Louisiana. Much of the acreage is controlled by large landholders or oil and gas
concerns as mineral rights are one of the primary considerations motivating an
investment in coastal wetlands. The Corps regulates the uses allowed on the
surface of wetlands but does permit recreational uses and mineral exploration.
As a result of an abundant supply, prices tend to be quite stable, as would be
expected.

Among the population of sales presented, prices have ranged from $15.81 (Sale
No. 28) to $600.00 per acre (Sale No. 42). The sale at the low end was part of a
sealed bid auction in conjunction with Sale No. 24.

Sale No. 6 was acquired by the United States Government. The Government paid a
21% premium for this tract which included approximately 10% agricultural land in
order to expand the Cameron Parish Wildlife Reserve in Cameron Parish.

The public sector, which for discussion purposes include not for profit
conservation and wildlife preservation groups, has been quite active in
acquiring wetlands, swamps and marshland in South Louisiana. Since 1984, public
or not for profit agencies have been involved in more than 50% of wetlands
acquisition for the purpose of wildlife and marshland management. Their 15
acquisitions have included a total of 77,474.72 acres. The total cost of
acquisition has been $23,420,291.00, indicating an average cost per acre of
$302.29.

Not included in the total are properties that were acquired by governmental
agencies under threat of expropriation or sites where surface easements have
been granted restricting the use of the surface. The federal government has been
quite active in the Atchafalaya Basin obtaining flow and conservation easements.

A summary of acquisition by the public sector is provided for review.

- -------------------------------- ------------------------------ ----------------------------- ------------------------------
YEAR ACREAGE ACQUIRED CONSIDERATION PRICE PER ACRE
- -------------------------------- ------------------------------ ----------------------------- ------------------------------

1984 6,097.00 $1,737,645.00 $285.00
1985 1,889.00 $538,365.00 $285.00
1986 15,960.32 $2,582,185.00 $162.00
1987 0.00 $0.00 $0.00
1988 9,910.00 $4,940,650.00 $498.00
1989 1,787.00 $586,041.00 $328.00
1990 18,000.00 $7,750,000.00 $430.00
1991 1,929.00 $771,572.00 $400.00
1992 13,282.56 $3,248,072.00 $244.54
1993 0.00 $0.00 $0.00
1994 0.00 $0.00 $0.00
1995 3,625.56 $200,000.00 $55.16
1996 0 $0 $0
1997 0 $0 $0
1998 0 $0 $0
1999 1,795.31 $299,450 $167.00
2000 -0- $0 $0
2001 -0- $0 $0
2002 -0- $0 $0
- -------------------------------- ------------------------------ ----------------------------- ------------------------------

While the years between 1988 to 1991 produced the highest paid activity, the
remaining years indicate little overall movement in pricing. 1995 is an obvious
exception, however, both sales were the result of a government mandated auction.
During the same period of public sector interest in the ownership of wetlands,
the private sector has actually acquired a greater amount of wetland and
marshes, based on transaction volume using gross acres. However, a decidedly
different pricing structure is evident in private sector acquisitions than seen
earlier from the public side.

Since 1984, private sector acquisitions have included a total of 235,734 acres,
with a total consideration of $38,335,082.00 having been paid. This results in
an average unit price for private sector purchases of $162.62 per acre compared
to the public interests at $302.29. This analysis would suggest, on a macro
basis, that rural marshland and swamp, identified by the public sector as
important for wildlife and habitat protection, would command a unit price of
$300.00 per acre and higher, while similar lands marketed to the private sector
could only command $100.00 to $200.00 per acre.

The public sector is now more selective in their choice of candidates for
acquisition. While the late 1980's-early 1990's saw the Louisiana Department of
Wildlife and Fisheries being active in the purchase of bulk tracts, their more
recent acquisition have been of generally smaller tracts adjacent to existing
preserves. It was indicated that due to limitations on resources and manpower,
it was more cost effective to concentrate on the occasional expansion of
existing preserves rather than focusing on creation of new independent wildlife
management areas.

The federal government continues to be active in the assemblage and management
of wetlands.

The National Park Service of the Department of the Interior commenced
development of the Jean Lafitte National Park in Jefferson Parish in the early
1970's. The Park, located off Barataria Boulevard in West Jefferson Parish, had
its boundaries designated in 1978 to include over 8,500 acres with an additional
11,000 acres north of the park boundaries in a protection zone. The majority of
the designated park area has been delineated as a wetland.

Research was conducted in order to determine the effective cost of acquisition
by the U.S. Government in order to develop the Jean Lafitte National Historical
Park and Preserve (Protection Zone). The United States Department of the
Interior, Division of Land Management Office in Santa Fe, New Mexico, was
contacted in order to obtain an acquisition history within the park. According
to Mr. Ken Kasper with the Land Acquisition Office, acquisitions have been
completed by means of negotiated purchases, donations by public entities and
condemnation, when required. Mr. Kasper indicated that in certain cases,
fractional interest or very small ownerships were involved, the price paid
reflected a nominal settlement consideration in lieu of a fixed price per acre.
To date, the Department of Interior has acquired a total of 137 parcels which
contain a combined site area of 16,136.35 acres for a total consideration of
$18,270,199.00. The effective average cost per acre for this program, which has
been ongoing, is $1,132.22 per acre. It should be noted that the assembled
acreage includes multiple parcels of high land with commercial highway frontage
along Barataria Boulevard, together with the wetlands acreage. The Park Service
is presently negotiating to purchase approximately 2,800 acres of high quality
marshland owned by the Louisiana Land and Exploration Company. The property is
adjacent to the west side of the park, adjacent to the eastern shoreline of Lake
Salvadore. The site is being marketed at $300 per acre, however, an appraisal by
the appraiser for the Park Service establishes the value at $200.00 per acre.
According to a representative of the property owner, negotiations have stalled
over the matter of price.

There is little evidence to suggest that location is a determining factor in
prices paid. The physical locations of wetlands are generally quite similar in
that they can be accessed for recreational purpose in spite of their remoteness.
Properties situated in close proximity to urban areas may be considered
locationally superior, however, if readily accessible by the general public, the
lands are more difficult to manage and control access.

Motivation and physical utility are two elements that dictate achievable price.
The most recent sales, which occurred during 1995, include sellers that were
exceptionally motivated to dispose of the respective parcels. As noted earlier,
each of the sales with Landmark Land Company as seller (#19, 20, 21, 22 and 23)
were part of a larger ongoing liquidation of this land company that was the
parent of Oak Tree Federal Savings and Loan Association. The savings and loan
was established using the assets of Landmark as its capital base. When the
institution was taken over by the Resolution Trust Corporation (successor of
FSLIC) the assets of Landmark were also assumed. The sales recited were sold
following a sealed bid auction. The prices paid represent generally less than a
third of the original asking prices based on prior appraisals. This type of
discount is not unique to these particular properties but was a common
occurrence with RTC sponsored sealed bid auctions.

Excluding the Landmark dispositions, Sale No. 11 produced the second lowest
overall unit price. The reason attributed to the nominal price is diminished
activity. In December of 1986, Champlin Petroleum Company liquidated its
15,960.32 acre holdings in Livingston, Ascension and St. Tammany Parishes to the
Nature Conservation for $162.00 per acre (Sale No. 3). That acquisition included
9,641.6 acres in Ascension and Livingston Parishes west of Lake Maurepas. This
portion of the whole include multiple, small, non-contiguous tracts, some as
small as 50 acres but on average +/-160 acres each. The majority of the property
was low-lying swamps and wet treeland, however, some higher ridgeland was
available adjacent to navigable waterways that traverse the area. The second
tract was located in St. Tammany Parish and included 6,318.7 acres adjacent to
the southern boundary of the Bogue Chitta National Wildlife Refuge. The land was
hardwood bottom land subject to seasonal flooding. Nature Conservancy had
purchased the larger tract intent on transferring the St. Tammany component to
the Louisiana Department of Wildlife and Fisheries. A delay in funding delayed
the closing and increased the cost to the conservation group. Wildlife and
Fisheries was able to agree to a staged acquisition between 1988 and 1992. The
purchases ranged from 364 acres to

1,900 acres at unit prices between $330.00 to $437.00 per acre. The price
fluctuation was developed using a base land value of $225.00 per acre, adjusted
for standing timber on the respective tracts.

Nature Conservancy still retains the Livingston/Ascension acreage. In a series
of 48 sales, the higher ridgeland and sites with road frontage was sold off for
prices between $150.00 to $1,500.00 per acre. The remaining non-contiguous
tracts were eventually sold as represented by Sale No. 11. The low unit price
was attributed to the low quality of the land, the inability to maintain
controlled access and a change in the federal tax status of the conservation
group. The motivation of the purchaser to acquire the portfolio was the mineral
potential.

The lowest unit price was produced by Sale No. 29. This 1,423 acre site is
located on the Westbank of the Mississippi River and essentially consists of a
canal right of way and land on each shore. The site measures 2,100' wide by a
depth of 4.8 miles. This site was sold as part of a liquidation, however, the
price paid does reflect the lack of demand, particularly for a canal right of
way such as Tract A of the subject portfolio.

Sale No. 19 is one of the largest recent acquisitions and involves the purchase
of more than 19,000 acres in Lafourche and Terrebonne Parishes to the north and
east of Houma. The property was originally acquired by Exxon as a mineral play.
It includes a mix of open land with highway frontage that is in use as pasture.

According to the U.S. Department of Agriculture, approximately 9,100 acres
exhibited physical features that would support grazing of livestock although the
acreage was subject to periodic standing water which required pumping. The unit
price of $120.68 per acre is considered indicative of prevailing value when
dealing with extremely large bulk tracts of wetlands.

Sale No. 24 would suggest that a higher price may potentially be realized,
however, the property conveyed in Sale No. 24, with its total of 4,516.7 acres,
included 300.35 acres of pastureland, residential lots and Highway 90 frontage.
The balance of the property acquired, 4,216.42 acres, was intact wet treeland
consisting primarily of cypress swamp.

Prior to the sale of this tract, an appraisal established the value of 40.92
acres zoned commercial at slightly less than $1,000,000.00 producing a residual
to the balance of $210,000.00, or $46.92 per acre.

It should be recognized that the property owners were under some duress due to
the fact that they were delinquent on their mortgage payments. The property was
assembled between 1972 an 1977 at an average effective cost of $2,000,000.00, or
$451.63 per acre.

The property had been on the market at an asking price of $4,300,000.00, $952.00
per acre, but drew little response. The ultimate purchaser acquired the property
in a sealed bid auction. While the method of sale and duress on the part of the
purchaser may disqualify this sale as an arms-length transaction, other bids in
the property were below the successful bid. This may suggest that liquidation
value and market value are synonymous for highly speculative rural properties
requiring a long-term investment outlook and the ability to carry an asset with
an uncertain potential revenue stream.

The comparable sales census includes a population of 44 properties ranging in
size from 61,500 acres (Sale No. 10) to 127.65 acres (Sale No. 35). When the
extremes are eliminated, the average size of the remaining sales drops to
5,391.06 acres.

The effect of size on marketability and price is evidenced by Sale No. 19, the
December 1994 sale of former Exxon Holdings in Lafourche and Terrebonne
Parishes. This 19,059 acre site was acquired for $120.68 per acre.

Sale No. 33 confirms that a discount is necessary when large blocks of wetlands
are being sold. Sale No. 33 involves a two part acquisition of a 49,320 acre
tract of land in proximity to the town of Gheens in north Lafourche Parish. The
purchaser had been leasing a portion of the property and acquired half of the
larger tract of land in 1998 with an option to acquire the balance.
Approximately 3,000 acres of this tract or 6% of the total was suitable for
agricultural use.

The purchaser acquired the property with the intent of establishing a commercial
hunting and fishing operation.

A sale that would initially contradict a discount in price based on size is Sale
No. 30. The property, according to an attorney that represented Louisiana Delta
Farms, was acquired purely on the basis of its mineral production and potential.
The property had been owned jointly by the Fruehauf Foundation, the heirs of W.
Elton Jones and I. P. Farms, Inc., a wholly owned subsidiary of International
Paper. One of the heirs acquired the interest conveyed for their own account.
The Foundation wanted to liquidate their position due to liability and property
management issues. The attorney involved indicated that the price was
established based on a valuation of existing production and future reserves. In
order for the Fruehauf Foundation to liquidate its position, Delta Farms, LLC
was required to acquire the foundation's surface position as well.

The Louisiana Land and Exploration Company, a subsidiary of Burlington
Resources, at one time controlled as much as 600,000 acres of coastal wetlands
in Southeast Louisiana. Following their acquisition by Burlington, a decision
was made to begin an asset disposition program and approximately 50,000 acres of
marshland and reclaimed marshland was targeted for disposition. Since December
of 2000, LL&E has sold multiple bulk tracts of marsh and reclaimed land in
Lafourche and St. Charles Parishes, as well as numerous fishing camps and camp
sites and two recreational marinas. LL& E owns a significant amount of acreage
subject south Lafourche property that had been leveed and placed under pump
prior to the implementation of strict wetlands regulations. Three such projects
were in Golden Meadow and two were in the des Allemands/Paradis area of St.
Charles Parish.

- ----------- --------- ---------------------- ----------------------- -------------- ------------- --------------------------
SALE NO. AREA UNIT
DATE CONSIDERATION PURCHASER (ACRES) PRICE LOCATION
- ----------- --------- ---------------------- ----------------------- -------------- ------------- --------------------------

38 12/00 $310,500 LOOP, Inc. 103.5 $3,000.00 E. Golden Meadows
Reclamation Area
............ ......... ...................... ....................... .............. ............. ..........................
39 10/01 $3,500,000 Dabunch, Inc. 3,096.2 $1,130.42 Des Allemands
Reclamation Area
............ ......... ...................... ....................... .............. ............. ..........................
40 10/01 $1,000,000 Kappa Loyal, LLC 1,714.66 $583.20 Paradis Reclamation Area
............ ......... ...................... ....................... .............. ............. ..........................
43 11/01 $2,673,165 Galliano Cattle Co. 2,430.15 $1,100.00 Raphael Reclamation
Project
............ ......... ...................... ....................... .............. ............. ..........................
44 01/02 $2,100,00 Greater Lafourche 1,250.4 $1,679.49 E. Golden Meadow
Port Commission Reclamation Project
- ----------- --------- ---------------------- ----------------------- -------------- ------------- --------------------------

The five tracts recited, three in Lafourche Parish and the other two in St.
Charles Parish, were formerly coastal marsh or freshwater swampland. LL&E, many
years ago, undertook the reclaiming of the land by the construction of ring
levees and the installation of pumps supporting drainage canals.

Sales 38 and 44 were sites surrounding the Golden Meadow Airport. The Lafourche
Port Authority had taken over the operation of the airport and their acquisition
will be used to create a business/industrial park in support of Port Fourchon.

The other three sales were consummated after an extensive marketing period.
Notwithstanding the extensive infrastructure that was in place, these tracts
commanded unit prices that were below that of good grade sugarcane land.

These lands generally do not support the cultivation of crops and due to
inferior subsurface soil conditions, the land is subject to subsidence. These
sales would also confirm that, Corps of Engineers regulatory authority
notwithstanding, the value of reclaimed land does not justify the time and cost
of reclamation.

Sales 41 and 42 are both located to the west of Highway 90 between Houma and
Raceland. These two tracts involved a combination of marsh and wooded land that
was ideally suited for hunting. There was active bidding on these tracts when
LL&E announced their availability. The tracts had been productive for hunting
over the years and their relative proximity to Houma made them attractive
investments. While the soil conditions were generally swampy, the majority of
the interior areas of these tracts were accessible by all terrain vehicles
during the day season.

Sale No. 45 is the most recent sale of a bulk tract of cypress-tupelo swampland.
This 7,481 acre tract is located near Lower Vacherie in northern Lafourche and
Terrebonne Parishes. The site is accessible by car having more than 2.5 miles of
frontage on Louisiana 20, which bisects the site.

This property sold on May 20, 2003 for $1,608,000, or $215.00 per acre. It was
not actively marketed, however, it was common knowledge that the property was
available for a number of years. The unit price paid is representative of the
pricing structure that has been prevalent for bulk tracts of swampland for a
number of years. The highest and best use of this property is hunting, trapping
and freshwater fishing.

The profile of the subject properties generally mirrors that of the sale
properties. Excluding the three bulk transactions with in excess of 15,000 acres
each (Sales 10, 19, and 33), the remaining private sector sales contained an
aggregate area of 101,130 acres and sold for $14,519,690, or $143.57 per acre.
The average number of acres conveyed in each sale was 3,371 acres.

As noted earlier, the public sector has not been an active participant in the
market for acquiring coastal marsh and/or inland swampland during the past ten
years as reflected by only two acquisitions during the last decade. This would
suggest that the most likely market would be individual purchasers with the
primary motivation being recreational in nature.

The comparable sales data presented would support a base line value for coastal
marsh of $150.00 per acre. This unit price would be subject to adjustment based
on the quality of the wetlands, the percentage of land to open water and
location.

Reclaimed marshland that is under active management and can support other uses
in addition to hunting and fishing commands a significantly higher unit price
than inaccessible open coastal marshes. This is confirmed by Sales 38, 39, 40,
43 and 44.

Heavily broken up marsh; marsh that is largely waterbottoms, would be
discounted. Much of the non-reclaimed LL&E land in South Lafourche Parish
consists of almost 95% open water, excepting

the man-made dredge spoils areas adjacent to former oil field canals. There is
no identifiable market for this type of property as it is difficult to manage
or restrict access.

According to the U.S. Army Corps of Engineers, the Avoca Island Mapping Unit
lost approximately 5,000 acres of marsh between 1930 and 1990. Over the past 14
years, efforts have been successful in reducing the erosion of the marsh,
however, much of the interior of the island remains open water and subject to
saltwater intrusion. According to the on-site manager, saltwater intrusion has
destroyed much of the natural habitat for fish and the recreational amenity is
now limited.

By virtue of the location of Avoca Island in direct proximity to Berwick, Morgan
City and Amelia, and the extensive perimeter of the island, constant management
is required to deter poaching and trespassing. The cost associated with land
management and security is one of the primary motivations behind Burlington
Resources Asset Divestiture program.

In their negotiations with Burlington Resources, the U.S. Department of Interior
offered $200 per acre for 2,800 acres of pristine consolidated marsh adjacent to
the Jean Lafitte National Park in Jefferson Parish along the shores of Lake
Salvadore. The most recent sale of a large tract of high quality, cypress swamp
was Sale 45, the May 2003 sale of 7,481 acres in Lower Vacherie for $215 per
acre.

The subject includes, as noted before, three distinct land group types including
marshland, ridge land and open water. The sales would support a base line value
of high quality marsh of $200 per acre. Pastureland would command a premium over
the marshland and will be assigned a value of $400 per acre. A higher value
would be warranted if the pasture had direct access. The open water would be
discounted relative to the value of the marshland and is assigned a value of $50
per acre. Using these per acre unit prices, the market value of the subject land
can be calculated.

- -------------------------------- ------------------------------ ----------------------------- ------------------------------
LAND TYPE AREA UNIT PRICE INDICATED VALUE
- -------------------------------- ------------------------------ ----------------------------- ------------------------------

Marsh 9,600 acres $200.00 $1,920,000
................................. .............................. ............................. ..............................
Ridge Land 1,800 acres $400.00 $720,000
................................. .............................. ............................. ..............................
Open Water 4,800 acres $50.00 $240,000
- -------------------------------- ------------------------------ ----------------------------- ------------------------------
Indicated Totals 16,000 acres $166.50 $2,664,000
- -------------------------------- ------------------------------ ----------------------------- ------------------------------

The indicated value produces an overall weighted average unit price of $166.50
per acre. Over the last 20 years, private sector transactions involving a total
of 235,734 acres of coastal marsh have produced an average unit price of $162.62
per acre. This is more than ample support for the estimated value of the subject
tract. Accordingly, the market value of the fee simple interest in the subject
property, Avoca Island, is concluded to be:

Two Million Six Hundred Sixty Thousand and No/100 Dollars
($2,660,000.00)

A potential purchaser of the fee simple interest in the subject property would
have to give consideration to the existing lease to the Avoca Duck Club. Under
the terms of the lease, the Duck Club's initial replacement cost of the new
lodge, for the purpose of the lease, shall not exceed $250,000 nor shall the
reimbursable amount be less than an $80,000 floor. The club's cost is amortized
over 30 years at $8,333.33 per year. The lease was effective on June 1, 1994.
Amortizing the initial nine years would produce a current unamortized
replacement cost of approximately $175,000.

Given the fact that the subject would not be self-sustaining based on its
surface rentals, a potential purchaser would only be attracted to the Island for
the potential to use the surface rights. As a consequence and in anticipation
that no purchaser would buy the underlying fee for the right to receive the
rental income in place, the unamortized cost of the Duck Club Lodge must be
deducted from the unencumbered fee simple value, resulting in an estimated
market value conclusion of the "as is" leased fee interest, calculated as
follows:

- --------------------------------------------------------------- -------------------------------

Unencumbered Fee Simple Interest $2,660,000
Less: Unamortized Replacement Cost of Lodge $175,000
- --------------------------------------------------------------- -------------------------------
Indicated Value "As Is" $2,485,000
- --------------------------------------------------------------- -------------------------------

At the concluded market value estimate, a sale could be completed within twelve
to eighteen months. While the market is not particularly active for large blocks
of coastal marsh, sales volume has been steady with the average absorption of
similar type property being approximately 11,750 acres per year.

The appraisal has been prepared in conformity with, and subject to, the
reporting requirements of the Uniform Standards of Professional Appraisal
Practice, the Uniform Standards of Professional Appraisal Practice (USPAP),
Title XI of the Financial Institutions Reform, Recovery and Enforcements Act of
1989 (FIRREA), the Office of the Comptroller of Currency, and the Louisiana
Certified Real Estate Appraisers Law.

The appraisal report and the analyses contained herein are made under the
assumption that there are no adverse environmental conditions affecting the
subject property and that there are no hazardous materials on or near the
subject property that would cause a loss in value.

The appraisal assignment was not based on a minimum valuation, a specific
valuation or the approval of a loan. The undersigned has prepared narrative
appraisals on numerous properties similar in scope to the subject.

I hope this report adequately serves your purposes. If there are any questions,
or if I can be of further assistance, please do not hesitate to call. Thank you
for the opportunity to be of service.

Respectfully submitted,
Robert W. Merrick Appraisal Division of
Latter & Blum, Inc./Realtors

/s/ Patrick J. Egan
Patrick J. Egan, CRE
Louisiana State Certified General Real
Estate Appraiser, Certificate #0107

PJE/cs

[Addenda, consisting of Subject Photographs, Location Map, Comparable Land
Sales Map, Property and Lease Map, and Appraiser's Qualifications
are available from Avoca. Please see Proxy Statement, Available
Information for details.]

[COLLARINI ASSOCIATES LETTERHEAD]

August 2, 2004

Mr. Paul Hogan
Avoca Incorporated
228 St. Charles Avenue, Suite 838
New Orleans, Louisiana 70130

Dear Mr. Hogan:

In accordance with your request, we have examined the geoscience, engineering,
and financial data associated with Avoca Incorporated's mineral interest
underlying Avoca Island, located in St. Mary Parish, Louisiana. You requested
Collarini Associates to estimate the fair market value of these mineral
interests.

There are four pieces of value of Avoca's mineral assets. The first, and most
important, is the value of the current production from the five active wells.
The second is the value associated with behind pipe zones in the current wells.
The third is the value associated with the lease hold by McRae Exploration &
Production, Inc. (McRae). The fourth is the value associated with future wells
not yet drilled.

The fair market value of the first three pieces is based on reserves and future
cash flow. There were no geologic maps available to us. Since the nature of the
Operc Sands requires that pore-volume analysis be used for reserve estimation,
we loaded the 3-D seismic dataset onto our seismic workstation. The depth of the
producing wells coupled with what appeares to be problems with the seismic
cultural data limited the usefulness of this data. However, when integrated with
geologic, pressure, production, and other data, we were able to estimate the
remaining producing and behind pipe reserves. We previously had received
geologic and engineering information from McRae on their recently drilled well.
We also scanned the entire 3-D dataset provided to us to appraise the future
potential of the unleased acreage.

Current production

There were five wells producing, as of the first quarter of 2004. These wells
generated revenue of $1,285,337 during the quarter, according to information you
provided. Revenue has been fairly constant, with increasing prices compensating
for decreasing production.

Collarini Associates examined the engineering and geoscience data on each of
these wells and estimated remaining reserves. We then used Nymex futures prices,
as of the close of the day May 5, 2004, to project future cash flow from each
well. Based on information from the Society of Petroleum Evaluation Engineers
(SPEE), we estimated the fair market value for proved producing reserves to be
90% of the net present value, discounted at 15% annually. Based on the above, we
estimate the fair market value of the producing properties as of May 1, 2004, to
be $5.80 million.

Avoca Incorporated
August 2, 2004
Page Two

This is a fairly low multiple of the current cash flow. However, this is
justified by the high production decline rate of the wells coupled with the
forecasted decreasing forward oil and gas prices.

Behind pipe potential

We examined the behind pipe potential of the currently producing wells. There is
considerable risk that offset wells have depleted these behind pipe reserves.
Based on our experience in the acquisitions and divestment market place, we
believe these reserves have no market value.

Undeveloped reserves

McRae is currently drilling a sidetrack that targets the Discorbis 4 Sand. The
original well, the Burlington #1 Conrad, appears to have watered out prematurely
due to a poor primary cement job. A sidetrack was attempted, but was
mechanically unsuccessful. McRae initiated a second sidetrack in April 2004, and
reached total depth in June 2004. The well was a dry hole. Log analysis and a
production test confirmed the target zone is now wet. It appears the gas in the
Discorbis 4 Sand migrated uphole, behind pipe in the original well. Since this
was the only target for this well, the royalty interest for this well has no
value.

Leasehold interest

Avoca owns unleased minerals underlying approximately 16,000 acres. There may be
value associated with leasing this acreage plus the royalty received from
successful drilling. A 3-D seismic survey was shot across this area several
years ago, resulting in the drilling of several wells. Since this seismic data
has been available for several years and has been evaluated by several
companies, it is unlikely that additional drilling opportunities will be
identified. Additionally, we saw no areas of immediate interest in the 3-D
dataset. Thus no value was assigned to the unleased acreage.

Summary

In summary, we estimate the fair market value of the mineral and royalty
interest owned by Avoca to be $5.80 million, as of May 1, 2004.

This fair market valuation has been performed in accordance with sound
geoscience and engineering principles and generally accepted industry practice.
As in all aspects of oil and gas evaluation, there are uncertainties inherent in
the interpretation of geoscience and engineering data, and all conclusions
represent only informed professional judgments.

Avoca Incorporated
August 2, 2004
Page Three

The titles to the properties have not been examined by Collarini Associates, nor
has the actual degree or type of interest owned been independently confirmed.
The data used in our estimates were obtained from Avoca Incorporated and from
sources that provide publicly accessible data and are considered accurate.

A visual inspection of the properties themselves was not considered necessary
for the purpose of this report. No assessment of compliance with environmental
regulations was made. We are independent consultants; we do not own any interest
in this property and are not employed contingent upon the value of this
property. All engineering calculations and basic data used in the analysis are
maintained on file in our office and are available for review.

Very truly yours,
COLLARINI ASSOCIATES

/s/ Dennis Jordan
Dennis Jordan, P.E.
President

DGJ/cab