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BRYCE RHODES - WHITTIER ENERGY CORPORATION (WHIT)
CEO Interview - published 02/07/2005

DOCUMENT # ABA614

BRYCE W. RHODES has been President, Chief Executive Officer and a
Director of Whittier Energy Corporation since September 2003. Mr. Rhodes
was a Vice President of Whittier Energy from its incorporation in 1991
through September 2003. In that capacity he managed all aspects of its
acquisition and exploration investments and its day-to-day activities.
Since April 1999, he has served on the Board of Directors of PYR Energy
Corporation, a public oil and gas exploration company. Mr. Rhodes also
served as an investment analyst for the M. H. Whittier Corporation, an
independent oil company, from 1985 until 1991.

Sector: oil & gas drilling & exploration

TWST: What is Whittier Energy?


Mr. Rhodes: Whittier Energy is an exploration and production company,
whose strategy is to acquire and exploit producing properties, while
also maintaining exposure to exploration opportunities. We intend to
build the company to an attractive size and sell it or merge it at an
appropriate time. Our operated properties are in the Gulf Coast area and
currently there are five in Texas and three in Louisiana. To date, most
of the exploration ventures we have participated in have been generated
by third parties. As a result, we are very opportunistic in the kinds of
things we participate in, and we have non-operated projects in Texas,
Oklahoma, Wyoming and California. We are operating two exploration
projects: one in Texas and one in Louisiana.

TWST: What was the genesis of the company?


Mr. Rhodes: The current entity has grown from a company that was created
in 1991, which was seeded with various non-operated assets that were
owned by the Whittier family. The largest of those assets was a fee
mineral interest in 2,600 acres in South Texas, which was producing
royalty income. The mandate for Whittier Energy was to reinvest the cash
flow and grow the company. This was done by participating in exploration
ventures and acquisitions of producing properties in a process of
continuously reinvesting its cash flow. By the end of 2002, the asset
base had grown to approximately $5 million debt-free, but there was very
little opportunity for paying dividends or for providing liquidity for
the shareholders. The decision was made to change our strategy. We were
given a green light to acquire producing properties that we would
operate and to employ debt in so doing. Since early 2002, we have
acquired the eight properties. We have grown our asset base to more than
$25 million, and we have an enterprise value of approximately $30
million. We have taken our operating production from zero to
approximately 1,100 barrels a day, and we currently have a little less
than 3 million barrels of oil equivalent in reserves.

TWST: What is your overall view of the areas in which you are active as
far as geography and the value you have in your own assets? Where does
that fit into oil and gas as an industry, as pricing and other dynamics
have an impact on you as you review your strategies and goals with this
company?


Mr. Rhodes: I'll talk in terms of the opportunities that we see and some
of the competitive situations that we face. As a small company, we have
been able to acquire properties that are under the radar screen of a lot
of our larger competitors. Most of our acquisitions have been relatively
small, well under $10 million, and they are just not big enough for many
larger companies we would otherwise compete with and a little too large
for many 'mom and pop' operators. As a result, we have been able to use
equity and bank debt to close on quite a few acquisitions. We have
tended to pass on acquisition opportunities being marketed on a
competitive bid basis. Instead,we have sought out situations where we
could sit down and negotiate directly with a seller  and work toward
concluding a transaction. As a result, our percentage of succesfull
transactions is very high and we spend less money and fewer resources
looking at deals. On an overall basis, where we operate, in the Gulf
Coast, there are still significant opportunities for companies of all
sizes. It is a very competitive area, and one needs to be very careful
about not paying too much and understanding the assets as much as
possible.

TWST: What is the agenda at this point? What are your priorities for
Whittier Energy over the next 12 to 24 months?


Mr. Rhodes: Our main engine of growth has been through acquisitions and
mergers. We went public by merging with a small company via a reverse
takeover. Its assets included cash and cash flow from interests in some
rapidly declining gas wells in California. We also raised $2.4 million
of new equity in a private placement in June 2004. We believe our major
future growth opportunities will be similar in terms of both
acquisitions and potential mergers. It is difficult to predict when or
if something will happen. We are always looking and any opportunity of a
sizable nature will most likely require additional equity, but at the
same time, we have quite a few projects on our plate as a result of the
things that we have acquired ' opportunities to develop and drill
internal exploitation wells and pursue some exploration projects.

TWST: What are the difficulties in finding suitable acquisition targets
today? What are your criteria? Again, how real is the market when you
look at the opportunities?


Mr. Rhodes: One criterion in terms of operated assets is that they be in
our core area, which is the Gulf Coast of Texas and Louisiana. If a
large and interesting opportunity outside of that area became real for
us, it would have to be of a size that justified opening another office.
Our other basic criteria are negotiated deals in our core operating
area, involving assets that have upside that we can realize and add
value to. In terms of the marketplace, sellers are very proud of their
assets in this high commodity price environment. The days of $18 oil and
$2 gas are probably well behind us at this point in time, so buyers need
to adjust their acquisition pricing criteria. We utilize hedging tools
and the futures market to reduce our downside risk. The basic strategy
for acquiring properties is still viable, but the numbers have changed.
We also believe that there may be some significant merger opportunities
with other companies both public and private where management is near
retirement age and wants to cash out.  In the case of public companies,
particularly small ones, the cost of compliance is very high in money
and resources.. We have set ourselves up to be able to work in this
Sarbanes-Oxley environment. So there may be some opportunities to
combine with companies whose management would just as soon not deal with
the high costs and headaches of the current public company arena.

TWST: Introduce us to your top-level management team and give us your
assessment as you look at bench strengths and skill sets. Are there
areas you'll be looking to augment?


Mr. Rhodes: I have been in the industry for 25 years. I have a geology
undergraduate degree, and I have a business degree. Most of my career
has been looking at the industry and participating from the investment
side. Our COO , Dan Silverman has degrees in petroleum engineering and
mineral economics. He has spent most of his career working on producing
property acquisitions and divestitures on behalf of several very active
companies, including Apache and Torch Energy Advisors. He brings that
skill set to bear in a very important way for Whittier. Our CFO, Michael
Young, has a Big Six accounting background with emphasis on oil and gas
tax. He worked as CFO of a small public company and, as a result, has a
lot of experience in terms of dealing with SEC issues, compliance
concerns and reporting requirements.  As far as adding new skills, we
will probably be looking to employ additional engineering and geologic
talent. We have recently hired an engineer to help out on the operations
side, and we use consulting geologists and geophysicists. We outsource
quite a bit currently, both on the financial side and on the technical
side and in our field operations, we use contract pumpers. We have
worked hard to keep our employee count low and, as a result, our costs
down.

TWST: What historically has been the shareholder base with the company?
Has that base undergone any changes or transitions?


Mr. Rhodes: From a private company that was owned 100% by the Whittier
family, we are now a public company with a much broader shareholder
base. Approximately 80% of the stock is still controlled by the Whittier
family, but as new equity is issued, over time, that may change. We
recently registered a block of shares, which included those from the
private placement we did in June. It will add additional shares to our
float and hopefully create opportunities for new shareholders.

TWST: In talks with your current investors, are there any misperceptions
you encounter about what they see as Whittier and what you see as the
reality?


Mr. Rhodes: As a very small company, what we run up against most is that
though generally people seem to appreciate the story and like it, some
potential investors are unable to invest as a result of our Bulletin
Board listing and small float and, therefore, lack of liquidity. We are
working hard to get our story out and will continue to do so. We would
like WHIT to be listed on an exchange and, as the company grows, we
expect to qualify for either an AMEX or a NASDAQ listing.

TWST: What compels investors to review Whittier Energy and include it in
their current portfolios and in their longer-term investment strategies?


Mr. Rhodes: Certainly, in the short term for the last couple of years,
our track record speaks for itself. We have upped our proved reserves
over 900%; our average daily production is up over 600% from the January
1, 2002 to September 30, 2004 reporting period. We have developed a
diversified and long life, stable reserve base with a dedicated and
experienced management team. We have a nice portfolio of low-cost, low-
risk exploitation projects in our core areas, and those involve both
operated and non-operated opportunities. We are continuing to look for
new acquisitions or merger opportunities, and we are a small, early
stage growth company, so relatively minor transactions and exploration
successes can have a material impact on our bottom line and, therefore,
our value. Also, we have a pretty strong balance sheet, which is
providing us flexibility for continued growth.  One thing that investors
should note is that we believe we are selling at the low end of many of
the common valuation metrics such as cash flow per share, EBITDA per
share, dollars per net daily barrel of oil equivalent (BOE) or thousand
cubic feet of gas (Mcfe) of production or dollars per net proved BOE or
MCFE. That, I think in part is a function of the liquidity issues that I
mentioned. As we get the story out there and grow in size, hopefully, we
will approach a more normal valuation in terms of the metrics that are
typically used by investors.

TWST: Thank you. (DWA)


BRYCE W. RHODES
 President & CEO
 Whittier Energy Corporation
 333 Clay Street
 Suite 1100
 Houston, TX 77002
 (713) 850-1880
 (713) 850-1879 ' FAX
 www.whittierenergy.com
 e-mail: info@whittierenergy.com

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