EXHIBIT 99.2

J.W. Rhea Interests, Inc.
Petroleum Consultants
3200 Kittowa Cove, Austin, Texas 78746
Telephone (512) 347-1571, Facsimile (512) 347-1573



                               November 15, 2002


Petrogen, Inc.
3200 Southwest Freeway, Suite 3300
Houston, Texas 77027

Gentlemen:

     At your request, this firm has prepared an estimate of the reserves, future
production, and income attributable to certain leasehold interests of Petrogen,
Inc. as of December 31, 2002 in the Emily Hawes Field located in Calhoun County,
Texas. The income data were estimated using the Securities and Exchange
Commission (SEC) requirements for future price and cost parameters.

     The estimated reserves and future income amounts presented in this report
are related to hydrocarbon prices. Hydrocarbon prices in effect on November 14,
2002 were used in the preparation of this report as required by SEC rules;
however, actual future prices may vary significantly from November 14, 2002
prices. Therefore, volumes of reserves actually recovered and amounts of income
actually received may differ significantly from the estimated quantities
presented in this report. The results of this study are summarized below.

                                 SEC PARAMETERS
                     Estimated Net Reserves and Income Data
                         Certain Leasehold interests of
            Petrogen, Inc., Emily Hawes Field, Calhoun County, Texas
                            As of December 31, 2002

                                                         PROVED
                                       -----------------------------------------
                                         Developed                      Total
                                       Non-Producing   Undeveloped     Proved
                                       -------------   -----------   -----------
Net Remaining Reserves
----------------------
  Oil/Condensate - Barrels                         0             0             0
  Gas - MMCF                                   6,771         2,257         9,028

Income Data
-----------
  Future Net Revenue                     $20,351,768   $ 6,783,922   $27,135,690
  Deductions                               4,376,027     1,427,009     5,803,036
  Future Net Income (FNI)                 15,975,742     5,356,914    21,332,656

  Discounted FNI @ 10%                   $11,217,013     3,585,913   $14,802,926

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Petrogen, Inc.
November 15, 2002
Page 2


                                                 PROBABLE
                                         -------------------------
                                                         Total
                                         Undeveloped    Probable
                                         -----------   -----------
Net Remaining Reserves
----------------------
  Oil/Condensate - Barrels                   366,338       366,338
  Gas - MMCF                                   3,815         3,815

Income Data
-----------
  Future Net Revenue                     $19,857,033   $19,857,033
  Deductions                               4,895,855     4,895,855
  Future Net Income (FNI)                 14,961,177    14,961,177

  Discounted FNI @ 10%                   $10,023,162   $10,023,162


                                                 POSSIBLE
                                         -------------------------
                                                          Total
                                         Undeveloped     Possible
                                         -----------     --------
Net Remaining Reserves
----------------------
  Oil/Condensate - Barrels                         0             0
  Gas - MMCF                                  17,666        17,666

Income Data
-----------
  Future Net Revenue                     $53,146,063   $53,146,063
  Deductions                               8,990,387     8,990,387
  Future Net Income (FNI)                 44,118,741    44,118,741

  Discounted FNI @ 10%                   $26,538,130   $26,538,130


     Liquid hydrocarbons are expressed in standard 42 gallon barrels. All gas
volumes are sales gas expressed in millions of cubic feet (MMCF) at the official
temperature and pressure bases of the areas in which the gas reserves are
located.

     The future gross revenue is after the deduction of production taxes. The
deductions are comprised of the normal direct costs of operating the wells, ad
valorem taxes, recompletion costs, development costs, and certain abandonment
costs net of salvage. The future net income is before the deduction of state and
federal income taxes and general administrative overhead, and has not been
adjusted for outstanding loans that may exist nor does it include any adjustment
for cash on hand or undistributed income. No attempt was made to quantify or
otherwise account for any accumulated gas production imbalances that may exist
now or in the future. Natural gas reserves account for 100 percent of the total
future gross revenue from proved reserves.

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Petrogen, Inc.
November 15, 2002
Page 3


     The discounted future net income shown above was calculated using a
discount rate of 10 percent per annum compounded monthly. Future net income was
discounted at four other discount rates, which were also compounded monthly.
These results are shown on each estimated projection of future production and
income presented in a later section of this report and in summary form in the
following table.

                          Discounted Future Net Income
                            As of December 31, 2002

        Discount Rate    Total             Total             Total
           Percent       Proved           Probable         Possible
           -------       ------           --------         --------

             12       $ 8,573,134       $ 9,285,346       $24,139,753
             15       $ 7,564,735         $8,295,73       $21,017,558
             20       $ 6,214,527       $ 6,908,810       $16,826,891
             25       $ 5,169,682       $ 5,785,316       $13,594,049

     *The results shown above are presented for your information and should not
be construed as this firm's estimate of fair market value.

Reserves Included in This Report

     The proved reserves included herein conform to the definition as set forth
in the Securities and Exchange Commission's Regulation S-X Part 210.4-10 (a) as
clarified by subsequent Commission Staff Accounting Bulletins. The probable
reserves and possible reserves, included herein, conform to definitions of
probable and possible reserves approved by the SPE/WPC using the deterministic
methodology. The definitions of proved, probable, and possible reserves are
included under the section "Reserve Definitions" in this report.

     We have included probable and possible reserves and income in this report
at the request of Petrogen, Inc. These data are for Petrogen's information only,
and should not be included in reports to the SEC according to the SEC disclosure
specifications. The probable reserves are less certain to be recovered than the
proved reserves and reserves classified as possible are less certain to be
recovered than those in the probable category. The reserves and income
quantities attributable to the different reserve classification that are
included herein have not been adjusted to reflect the varying degrees of risk
associated with them and thus are not comparable.

Estimates of Reserves

     The reserves included herein were estimated entirely by the volumetric
method since there were inadequate historical performance or pressure data to
estimate reserves by the performance or material balance methods. The volumetric
method involves the construction of reservoir structure and isopach maps to
determine volumes occupied by hydrocarbons. Reservoir parameters estimated from
well data and other sources are then used to estimate the volumes of
hydrocarbons contained in a reservoir and the estimated amounts of these
hydrocarbons expected to be recovered economically.

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Petrogen, Inc.
November 15, 2002
Page 4


     The reserves included in this report are estimates only and should not be
construed as being exact quantities. They may or may not be actually recovered,
and if recovered, the revenues therefrom and the actual costs related thereto
could be more or less than the estimated amounts. Moreover, estimates of
reserves may increase or decrease as a result of future operations.

Future Production Rates

     Initial production rates are based on analogy to wells previously drilled
in the subject field. Since there is insufficient historical performance data to
establish a production decline trend, an estimated rate of decline was applied
to depletion of the reserves based upon our experience with analogous wells and
formations in this area of the United States. For reserves not yet on
production, sales were estimated to commence at an anticipated date furnished by
Petrogen.

     The future production rates form wells to be drilled may be more or less
than estimated because of changes in market demand or allowables set by
regulatory bodies. Wells or locations that are not currently producing may start
producing earlier or later than anticipated in our estimates of their future
production dates.

Hydrocarbon Prices

     Petrogen furnished this firm with hydrocarbon prices in effect on November
14, 2002, and with its forecasts of future prices which take into account SEC
and Financial Accounting Standards Board (FASB) rules, current market prices,
contract prices, and fixed and determinable price escalations where applicable.

     In accordance with FASB Statement No. 69, November 14, 2002 market prices
were determined using the daily oil price or daily gas sales price ("spot
price") adjusted for oilfield or gas gathering hub and wellhead price
differences (e.g. grade, transportation, gravity, sulfur, and BS&W) as
appropriate. Also in accordance with SEC and FASB specifications, changes in
market prices subsequent to November 14, 2002 were not considered in this
report. Petrogen has informed this firm that there are no contracts in effect
for consideration in the sales of any of the hydrocarbon products included in
this report. Also, the effects of any derivative instruments designated as price
hedges of oil and gas quantities are not reflected in our individual property
evaluations.

Costs

     Operating costs for the producing lease included in this report were
provided by Petrogen and were represented to this firm as including only those
costs directly applicable to the lease. When applicable, the operating costs
include a portion of general and administrative costs allocated directly to the
lease under terms of operating agreements. No deduction was made for indirect
costs such as indirect general administration and overhead expenses, loan
repayments, interest expenses, and exploration and development prepayments that
are not charged directly to the lease. The operating costs presented by Petrogen
were accepted without independent verification or examination of lease operating
statements.

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Petrogen, Inc.
November 15, 2002
Page 5


     Development costs were furnished to this firm by Petrogen and are based
upon authorizations for expenditure for the proposed work or actual costs for
similar projects. The estimated net cost of abandonment after salvage was not
included for this property.

     Current costs were held constant throughout the life of the property.

General

     Table A presents a one-line summary of proved, probable, and possible
reserve and income data for each of the wells in the subject field. Tables 1
through 16 present our estimated projection of production and income by year
beginning January 1, 2003 for the total field and by well for each well in the
field.

     While it may reasonably be anticipated that the future prices received for
the sale of production and the operating costs and other costs relating to such
production may also increase or decrease from existing levels, such changes
were, in accordance with rules adopted by the SEC, omitted from consideration in
making this evaluation.

     The estimates of reserves presented herein were based upon a detailed study
of the property in which Petrogen owns an interest; however, this firm has not
made any field examination of the property. No consideration was given in this
report to potential environmental liabilities that may exist, nor were any costs
included for potential liability to restore and clean up damages, if any, caused
by past operating practices. Petrogen has informed this firm that it has made
available to us all of the accounts, records, geological and engineering data,
and reports and other data required for this investigation. The ownership
interest, prices, and other factual data furnished by Petrogen were accepted
without independent verification. The estimates presented in this report are
based on data available through November 14, 2002.

     Petrogen has assured this firm of its intent and ability to proceed with
the development activities included in this report, and that it is not aware of
any legal, regulatory or political obstacles that would significantly alter its
plans.

     Neither this firm nor any of our employees have any interest in the subject
property, and neither the employment to make this study nor the compensation is
contingent on our estimates of reserves and future income for the subject
property.

     This report was prepared for the exclusive use and sole benefit of
Petrogen, Inc. The data, work papers, and maps used in this report are available
for examination by authorized parties in our office. Please contact us if we can
be of further service.

                                       Very truly yours,

                                       J.W. RHEA INTERESTS, INC.


                                       /s/ John William Rhea, IV
                                       -------------------------
                                       John William Rhea, IV
                                       President