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RAM Energy Resources, Inc.

RAM Energy Resources, Inc. March 2007. Disclosure Statement.

winifred-whitley
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RAM Energy Resources, Inc.

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  1. RAM Energy Resources, Inc. March 2007

  2. Disclosure Statement This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, including, without limitation, statements that address estimates of RAM’s proved reserves of oil, gas and natural gas liquids, its derivative positions, the impact of derivatives, exploration activities, capital spending, borrowing availability, financial position, business strategy, management’s objectives, future operations, and industry conditions, are forward-looking statements. Although RAM believes that the expectations reflected in such forward-looking statements are reasonable, RAM can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from RAM’s expectations (“Cautionary Statements”) include, without limitation, the actual quantities of RAM’s oil and natural gas reserves, future production levels, future prices and demand for oil and natural gas, the results of RAM’s future exploration and development activities, future operating, development costs and future acquisitions, the effect of existing and future laws and governmental regulations (including those pertaining to the environment), the continued availability of capital and financing, and the political and economic climate of the United States as well as risk factors listed from time to time in our reports and documents filed with the SEC. All subsequent written and oral forward-looking statements attributable to RAM, or persons acting on RAM’s behalf, are expressly qualified in their entirety by the Cautionary Statements.

  3. Company Overview Operations Proved Reserves (12/31/05) 18.8 MMBOE % Crude 60% % PUD 30% PV-10 Value $345.5 MM % of PV-10 Value Operated 86% Historical Drilling Success Rate 93% Latest Twelve Months Financials(1) LTM Revenue $77.5 MM LTM EBITDA $33.8 MM • Unaudited; As of 9/30/06

  4. Company History • Founded in 1987 by current CEO and a former partner • Between 1987 and 2006, • Engaged in the acquisition, development, exploitation, exploration, and production of oil & natural gas properties • Completed 20 acquisitions for a total amount in excess of $400 million • WG Acquisition in 2004 has yielded a 146% IRR(1) based on effective acquisition price of $6.42 per BOE • Completed multiple divestitures consistent with business strategy totaling more than $139 million • Drilled or participated in the drilling of 561 wells at a success rate of 93% • Recent Highlights • May 2006 – Through merger with Tremisis RAM became public company • February 2007 – Raised $30 million from sale of common stock (1) Pre-tax IRR calculated using 12/31/05 PV-10 Value as a terminal value

  5. Execution of Business Strategy Develop and exploit existing oil & natural gas properties Accelerate North Texas Barnett Shale development Increase emphasis on exploration activity Complete selective acquisitions and divestitures

  6. Property Summary Producing Properties (1) Exploration Projects

  7. 2007E Capital Expenditure Detail North Texas Barnett Shale Electra / Burkburnett Boonsville Egan, Vinegarone, and Other West Texas Woodford / Barnett Shale Wolfcamp Formation Capitalized G & G Cost $9.7 MM $4.0 MM $1.6 MM $4.2 MM $0.5 MM $7.4 MM $2.9 MM $30.3 Million Proved Drilling Cap Ex Non-Proved Drilling Cap Ex Non-Drilling Cap Ex

  8. Growth in Capital Expenditures (dollars in millions) $ • Pursuant to strategy targeting growth, RAM has steadily increased CAPEX to unproven projects • CAPEX for 2007 allocates 65 percent for spending on proved reserves and 35 percent for spending on unproven projects

  9. Liquidity 12/31/06 • Financial Liquidity Analysis Cash Plus: Total Credit Line Less: Outstanding Credit • Operational Liquidity LTM Cash Flow from Operations 2007E Capital Expenditures Adjusted for Offering ($millions) Actual ($millions) (1) 6.7 34.8 (2) 140.0 140.0 (103.0) (103.0) Financial Liquidity 43.7 71.8 (3) 29.5 (30.3) (1) February 2007 RAM sold 7.5 million shares of common stock at a price of $4.00 per share for gross proceeds of $30 million or $28.05 million after deducting underwriting discount. (2) $300 million Sr. Secured Credit Facility with initial borrowing limit of $140 million provides expanded financial flexibility for growth (3) Last twelve months ended 9/30/06

  10. Electra / Burkburnett • Wichita and Wilbarger Counties, Texas • 3Q06 production of 169,730 BOE from 503 producers • 79 wells drilled in 2006 • 151 identified PUD drilling locations(1) with a projected D&C of $5.82 per BOE 100% WI ownership & operational control Includes assets that help maintain drilling schedule and control costs: gas plant, gathering system, one drilling rig, five workover rigs, and a supply company (1) At 9/30/06

  11. Electra / Burkburnett Production and Capital Expenditures • Average well statistics: • Drill & complete $128,000 • EUR 22,000 BOE • Economic life 20 years • IRR per well @$60/Bbl > 100% • IRR per well @$50/Bbl > 100% Forecast of Electra/Burkburnett Production (1) Production (MBoe) PUD inventory sufficient to maintain or increase production over the next several years, thereby sustaining RAM’s stable cash flow base 2007E Capital expenditures for Electra / Burkburnett budgeted for $9.7 million (38% of total capital expenditure budget) (1) Based on estimate of proved reserves and associated capital spending at 12/31/05.

  12. Boonsville • Jack and Wise Counties, Texas • 3Q06 production of over 44,160 BOE from 88 producers • 20 identified drilling locations • Avg. D&C cost: $625,000 • Avg. EUR: 115,000 BOE • 25 miles of gas gathering system • Proved reserves of 3,011 MBOE(1) • Capital expenditure budget of $1.6 million in 2007 • Producing wells hold Barnett Shale rights (1) As of December 31, 2005

  13. Barnett Shale • Jack and Wise Counties, Texas • 27,700 gross acres • 6,800 net acres • All acreage is HBP • 90% of the acreage located in the Core area • 325 potential horizontal drilling locations on 80-acre spacing • 9 gross producing wells existing • 35 square miles of 3-D seismic acquired and interpreted • Budgeted to add another 60 square miles during 2007 • Partners are EOG and Devon Core Tier 1 Tier 2 RAM’s Barnett Shale operating area

  14. Barnett Shale (EOG Area) Ashe 1H Seismic Acquired 2006 Planned 2007 Ashe 1H Well • Approximately 23,500 gross acres (5,600 net) – RAM WI=24% • More than 290 potential drilling locations on 80-acre spacing • One producing well – Ashe 1H completed in March 2006 • No PUD locations booked to date • 27 square miles of 3-D seismic • Additional 60 square miles planned for 2007 • Ongoing seismic review supports 11 additional drilling locations to date • RAM has proposed its first two wells to EOG; EOG has consented to drill both wells • Right to propose wells • If EOG declines to participate, RAM can drill wells on a non-consent basis

  15. Barnett Shale (EOG Area) Joint Operating Agreement (JOA) Terms Any working interest owner may propose a well Non-proposing parties have 30 days to elect to participate or opt for “non-consent” Participate “Non Consent” EOG Operates RAM operates or other option Must spud well within 90 days Must spud well within 90 days Estimated cost to drill and Complete, $3 million (MM) per well Estimated cost to drill and complete, $3 million (MM) per well Allocation of costs by working interest Allocation of costs by working interest (1) Other =10% RAM =24% EOG =66% RAM =90% Other =10% EOG =0% $2.7MM $0.0MM $0.3MM $0.7MM $2.0MM $0.3MM (1) Assumes “other” working interest partners elect to maintain existing working interests totaling approximately 10%

  16. Barnett Shale (Devon Area) • Approximately 3,500 gross acres (1,200 net) – RAM WI=36% • More than 35 potential drilling locations on 80-acre spacing • 7 producing wells to date • 4 PUD locations booked to date • 8 square miles of 3-D seismic • Ongoing seismic review supports 8 additional drilling locations to date • Continuous drilling clause in the participation agreement • Devon must drill a well 120 days after the completion of the previous well Additional Locations PDP - (Rawle 4H, Rawle A 1H, Burress Unit 1H, Burress Unit 2H, Etta Burress 1H, North of Paradise 1H, Fitzgerald 5H) PUD - (Burress Unit 3H, Burress Unit 4H, North of Paradise 2H, Fitzgerald 5-2H)

  17. Barnett Shale (Devon Area) Rawle / Burress Lease • 6 wells drilled to date • Average initial production = 1,921 MCFEPD • Average EUR = 1.9 Bcfe • Average well cost = $1.7 MM • Finding cost = $0.90 / Mcfe (1) (1) Composite of industry horizontal wells in Barnett Shale adjusted for RAM’s Rawle/Burress well performance

  18. Wolfcamp Fairway • Southwest Texas • Potential high-impact exploration • RAM has leased & optioned 15,000 net acres • 100% working interest • Two test wells vertically drilled • Stimulation, recovery of frac fluid and testing underway on two wells • If commercial, significant potential upside on 80 acre spacing

  19. Alpine Area 3 wells drilled J. Cleo Thompson 1 well drilled Barnett and Woodford Shale Thompson and Alpine Areas Reeves County, Texas Exploration play – 84,000 gross acres (6,600 net) Estimated thickness of the Barnett is between 400’ – 700’ and the Woodford varies from 200’ – 400’ Keys to success are horizontal drilling and fracture stimulation Four wells drilled under farmout agreements 3-D seismic shot over 10 square mile area

  20. Attractive Valuation vs. Peers EV as % of PV-10(2) (3) (4) EV / Proved Reserves (BOE)(1)(3) (4) • Represents proved reserves as of most recent SEC proved reserve filing • Represents PV-10 value as of most recent SEC proved reserve filing • RAM EV adjusted to reflect offering of common stock 2/8/07 • Share prices as of close 3/12/07

  21. Attractive Valuation vs. Peers EV / LTM EBITDA (3) (4) EV / LTM Daily Production (BOEPD)(1) (2) (3) (4) • “Herold Mean” are mean results of search of J. S. Herold’s database of industry transactions in the last twelve months of Gulf Coast Onshore, Mid-Continent, and Permian Basin transactions between $25 million and $250 million • Estimated 2006 daily production from research reports • RAM EV adjusted to reflect offering of common stock 2/8/07 • Share prices as of close 3/12/07

  22. Summary of Investment Considerations Stable cash flow base Compelling valuation vs. peers Significant management and technical experience Balanced oil & natural gas exposure Large inventory of growth opportunities High degree of operating control Proven value creation through both acquisitions and drillbit Management’s substantial ownership of RAM stock supports alignment with shareholder interest

  23. Quarterly Results (unaudited)

  24. Derivative Positions As of February 28, 2007

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