Operations

The Company conducts its main exploration and production operations through its wholly-owned subsidiary, Pegasi Operating Inc. The Company conducts additional operations through two other wholly-owned subsidiaries: (i) TR Rodessa Inc. and (ii) 59 Disposal Inc.
TR Rodessa Inc. operates a 40-mile natural gas pipeline and gathering system which is currently being used by the Company to transport its hydrocarbons to market. Excess capacity on this system may be used to transport third-party hydrocarbons in the future.
59 Disposal Inc. owns and operates a saltwater disposal facility which disposes saltwater and flow back waste into subsurface storage. 59 Disposal Inc. currently disposes of wastewater for Pegasi's operations as well as from other accepted operators for a per barrel fee.