albrecht & associates, inc.
January 27, 1997
Mr. Yossi Levy
Isramco Inc.
460 Park Ave
New York, NY 10022
RE: Fair Market Value
Farmers Acquisition
Dear Mr. Levy:
Per your request, I have estimated the current Fair Market Value (FMC) of the
following
1) The Farmers Acquisition
2) Isramco's 82.9% WI BPO (69.5% APO) in the Farmers Acquisition
For this appraisal, I have relied heavily upon the engineering provided to you
by Riseden Services, Inc. dated Januiary 16, 1997. Further, my firm has
independently engineered the Proved Producing reserves in the Farmers
Acquisition and have no material disagreements with the Riseden engineering on
that portion of the reserves. (My firm has not engineered the non-producing
reserves in the Farmers Acquisition.)
Based on the foregoing, our appraisals as of February 1, 1997, of the subject
properties are as follows:
Farmers Acquisition
Proved Producing: $2,200,000
Proved Behind Pipe: 300,000
Proved Undeveloped: 1,500,000
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Total FMV $4,000,000
1111 Fanin, Suite 1470 1660 Lincoln, Suite 2700
Houston, Texas 77002 Denver, Colorado 80262
713-931-9586 303-839-5627
Isramco Interest in Farmers Properties
WI = 82.9%
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Proved Producing: $1,459,000
Proved Behind Pipe: 199,000
Proved Undeveloped: 995,000
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Total FMV $2,658,000
Albrecht & Associates, Inc. has represented sellers of approximately $800
million of oil and gas properties, including over $150 million in 1996. Please
be advised, however, that the appraisal process is not an exact science and is
subject to many variables including changing market conditions for properties,
oil and gas prices, engineering uncertainties, as well as many other unknowns.
Our appraisal of the Fair Market Value is our best estimate taking into account
current conditions, but is made without any warranties whatsoever, either
express or implied. Untimately, the Fair Market Value is the value paid for a
property by a willing buyer to a willing seller.
If we may be of further service, please advise.
Sincerely,
/S/ ROBERT A. ALBRECHT
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Robert A. Albrecht
President