The Rocky Mountain Region comprises approximately 73% of our estimated proved reserves as of December 31, 2009. The majority of our undeveloped acreage and drilling inventory is located in this region, where our drilling efforts and capital expenditures have been focused.

In the Rocky Mountains, although we have significant acreage in three basins, we have dedicated the majority of our development efforts to our position in the Piceance Basin.

Piceance Basin.
Since 2005 we have dedicated significant financial capital and human resources to the development of our Vega Unit and surrounding leasehold in Mesa County, Colorado, which in combination is referred to as the Vega Area. In 2008 we acquired an additional 17,300 net acres, which increased our position to approximately 22,150 net acres, which has over 2,000 net drilling locations on 10-acre spacing. We also have a non-operated working interest in the Garden Gulch Field in Garfield County, Colorado. These fields are consistent with our strategy of targeting reservoirs that demonstrate predictable geology over large areas. The Williams Fork member of the Mesaverde formation is the primary producing interval and has been successfully developed throughout the Piceance Basin.

Vega Area.
The Vega Area includes the Vega Unit, the North Vega leasehold, the Buzzard Creek Unit, and North Buzzard Creek leasehold. Our working interest in the Vega Area varies between 95-100%. During fiscal 2008, we increased proved reserves in the Vega Area over 295% to 719.9 Bcfe and increased production from approximately 25 Mmcf/d at the beginning of the year to approximately 48 Mmcf/d at the end of 2008. However, during 2009, as a result of the combined effect of lower gas prices through the year and the new SEC reserve pricing rules, proved reserves decreased to 84.7 Bcfe. Production decreased to 25.8 Mmcf/d at the end of 2009 due to the limited capital spending during 2009. The Collbran Valley natural gas pipeline provides us with approximately 100 Mmcf/d of pipeline takeaway capacity. The pipeline system is expandable to 290 MMcfd with additional compression at CVGG Anderson Gulch Facility. We ended 2009 with 188 wells producing. Despite our large inventory of over 2,000 drilling locations and efficient reserve growth, we decreased our drilling program from four rigs to one rig at year end 2008, and further to zero rigs in 2009, primarily due to the decrease in natural gas prices and liquidity concerns. Since 2005 we have experienced significant reductions in drill time, and drilling and completion costs. We expect to continue completion activities in 2010 on wells awaiting completion, and to resume an active, continuous drilling program once commodity prices recover. Our drilling and completion capital budget for the Vega Area has not yet been determined pending the outcome of our borrowing base redetermination and the outcome of the previously discussed strategic alternatives process.

Garden Gulch.
We have an interest in approximately 6,300 gross (2,000 net) acres with a 31.1% non-operated working interest. The operator of the project temporarily ceased drilling activity in 2009, but resumed completion activity in late 2009 and began a one rig drilling program in early 2010. Our capital budget for the year ending December 31, 2010 is driven by the activity level, which is determined by the operator.


Paradox Basin.
In the Paradox Basin we have five prospect areas: Greentown, Salt Valley, Fisher Valley, Gypsum Valley and Cocklebur Draw. Over the past three years we focused primarily on the Greentown prospect, in Grand County, Utah. The objectives that were targeted in these prospects were reliant upon various geologic models, which included multiple stacked clastic intervals imbedded within an evaporate salt in the Paradox formation, and unconventional shales.

Greentown.
From 2006 through 2008, we drilled a total of eight wells in the Greentown project area. Delta observed encouraging hydrocarbon flows from three of the initial wells. The Greentown 36-11, 32-42 and 28-11 which all produced hydrocarbon from one or more of the clastic intervals at commercial rates. Although these first two exploration wells were lost due to casing failure, subsequent wells were drilled with improved casing designs and did not experience similar failure. Due to Delta's need to devote its limited capital to the Piceance Basin properties in 2010, we have farmed out our interest in several of the Paradox wellbores to another firm and retained a carried 25% interest in the completion of each of the wellbores. The farmout specifically assigns operating rights to the Federal 28-11 and Greentown Federal 26-43D well along with associated abandonment responsibilities. The agreement also provides for the option to extend the agreement to other wellbores.
We have a 70% working interest in 34,000 gross acres, 23,400 net acres. The acreage remains prospective and we are hopeful that the farmout will prove successful. We have not budgeted any significant activity in Greentown for the year ending December 31, 2010.

Salt Valley.
The Salt Valley project area has had one exploratory well drilled. Additional drilling plans are not expected in 2010. We have a 70% working interest in 7,065 gross acres, 4,900 net acres.

Fisher Valley, Gypsum Valley and Cocklebur Draw.
We have three remaining prospects in the Paradox Basin located in San Miguel and Dolores Counties, Colorado and Grand County, Utah. We have a 70% working interest in 49,200 gross acres, 36,600 net acres, all of which were undeveloped at December 31, 2009.

Denver-Julesburg (“D-J”) Basin.
Our leasehold in the Denver Julesburg Basin focuses on the "J" sand formation at depths of between 7,000 feet and 8,000 feet. In 2007 we drilled an exploratory well, the Cowboy 35-21 well, which was a discovery that began production at a rate of 200 Bo/d. Subsequent development of the Cowboy field included ten additional wells which allowed production to peak at approximately 1,100 barrels of oil per day. Production has since declined to 330 Bopd. We have identified numerous seismically defined structures, similar in size to the Cowboy field. We have 70,243 net acres with a 100% working interest. Our drilling capital expected for the D-J Basin in 2010 is primarily related to a well which spud in late January 2010 and is expected to be on production by the end of April 2010.