Exhibit 99.1


                                 January 9, 2004


Cadence Resources Corporation
c/o Lucius C. Geer & Associates
11211 Katy Freeway, Suite 400
Houston, Texas 77079


Attention:   Mr. L. C. Geer


                                                  Re: Waggoner Estate Properties
                                         Various Leases, Wilbarger County, Texas
                                     Appraisal of Reserves and Future Net Income
                                                Effective Date - October 1, 2003

Dear Mr. Geer,

At your request we have  prepared a revised  evaluation  of the oil reserves and
associated  future net income  attributable to the interest of certain producing
properties on the Waggoner Ranch in Wilbarger  County,  Texas.  These properties
are on the Waggoner Cadence "A" and "B" leases and the Waggoner-Cadence  Electra
Lake Lease.

This evaluation  supercedes our evaluation  dated November 25, 2003. It includes
an annual increase of $60,000 in operating costs, net to the working interest of
Cadence Resources  Corporation.  The Cadence "B" lease well is near the economic
limit  (Remaining Life = 8+/- months)  utilizing the operating costs used in the
November 25, 2003  evaluation:  therefore,  no additional  operating  costs were
applied to the "B" lease.  The $60,000 was allocated  equally to the net working
interests  of the other  wells,  one on the  Cadence  "A" lease and three on the
Waggoner-Cadence Electra Lease


This  report  presents  our  estimates  of the  proved  producing  oil  reserves
anticipated to be produced from the leaseholds evaluated. Natural gas production
has not been reported


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Cadence Resources Corporation                                    January 9, 2004
Waggoner Estate Properties                                                Page 2
Appraisal of Reserves and Future Net Income
Effective Date - October 1, 2003


for these properties;  consequently gas reserves have not been estimated.  Also,
no undrilled locations,  either proved or otherwise, have been evaluated in this
report.

Davis has also estimated the future net revenues and  discounted  present values
associated  with the scheduled  production of these reserves as of the effective
date of October 1, 2003.

The results of our study may be summarized as follows:

<TABLE>
<CAPTION>
                          Non Escalated Pricing Scenario
                    Estimated Reserves and Future Net Income
                        Net to Waggoner Estate Properties
                              As of October 1, 2003

                                       Estimated Net Reserves               Future Net Income ($1000)
                                        ---------------------               --------------------------
Reserve Category                       MBarrels            MMCF            Undiscounted       Disc.@ 10%
--------------------                -----------            ----            ------------       ----------

<S>                                     <C>                      <C>          <C>                  <C>
PROVED RESERVES

Producing                               66.137                   0.0          1,461.5               1,248.5

TOTAL PROVED                            66.137                   0.0          1,461.5               1,248.5
</TABLE>

Gas volumes are  expressed  in  millions of standard  cubic feet  (MMSCF) at the
official  temperature and pressure base of the area wherein the gas reserves are
located.

DATA SOURCES

Mr.  Davis  furnished  basic  leasehold,  well and  ownership  data  used in the
preparation  of this  report.  Davis has accepted as correct the records as they
pertain to factual matters such as acreage  controlled,  working and net revenue
interests,  the number and depths of wells,  reservoir  pressure and  production
history.  Davis made no physical  inspection of the properties nor conducted any
well tests.

DISCUSSION

Current daily  production  from the properties was reviewed and the forecasts of
recoverable  reserves based upon  volumetric  determinations  of hydrocarbons in
place.  Recovery  of  those  hydrocarbons  has  been  estimated  from  reservoir
conditions and performance to date,  including water production from those wells
on the Electra Lake



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Cadence Resources Corporation                                    January 9, 2004
Waggoner Estate Properties                                                Page 3
Appraisal of Reserves and Future Net Income
Effective Date - October 1, 2003


lease and  anticipated  water  production  from the  Waggoner  Cadence "A" lease
completion.

Production  from the  three  completions  on the  Electra  Lake  lease  has been
reported on a total lease basis and when necessary allocated to individual wells
on an equal basis. However, the Electra Lake #1 well has a different working and
revenue  interest  position.  Consequently  the  actual  interests  used  in the
evaluation are an average interest for the three wells combined.

RESERVE DEFINITIONS

Reserves - are estimated volumes of crude oil, condensate,  natural gas, natural
gas liquids and associated substances anticipated to be commercially recoverable
from known  accumulations  from a given date forward,  under  existing  economic
conditions,  by established  operating  practices,  and under current government
regulations.  Reserve  estimates are based on  interpretation of geologic and/or
engineering data available at the time of the estimate.

Proved  Reserves - are  quantities  of crude oil,  condensate,  natural  gas and
natural  gas liquids  that can be  estimated  with  reasonable  certainty  to be
recoverable  under current  economic  conditions.  Current  economic  conditions
include  prices and costs  prevailing at the time of the estimate.  Reserves are
considered  proved if commercial  producibility of the reservoir is supported by
actual  production or formation tests. In certain  instances proved reserves may
be assigned on the basis of electrical  and other type logs and/or core analysis
that indicate that the subject reservoir is hydrocarbon bearing and is analogous
to  reservoirs in the same area that are  producing,  or have  demonstrated  the
ability to produce on a formation test.

The area of a reservoir  considered  proved  includes (1) the area delineated by
drilling and defined by fluid contracts, if any and (2) the undrilled areas that
can be reasonably  judged as  commercially  productive on the basis of available
geological and engineering  data. In the absence of data on fluid contacts,  the
lowest known  structural  occurrence of  hydrocarbons  controls the lower proved
limits. Proved reserves do not include volumes of crude oil, condensate, natural
gas or natural gas liquids being held in inventory.

CLASSIFICATION OF RESERVES

The reserves  considered in this report are defined as proved and were estimated
in  accordance  with the  definitions  outlined in the  Securities  and Exchange
Commission (SEC)  regulations S-X Part 4-10 and Financial  Accounting  Standards
Board Statement No. 69.


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Cadence Resources Corporation                                    January 9, 2004
Waggoner Estate Properties                                                Page 4
Appraisal of Reserves and Future Net Income
Effective Date - October 1, 2003


ECONOMIC PARAMETERS

Pricing  for Crude Oil and  Condensate  - The unit  price used  throughout  this
report for crude oil is based upon an  initial  oil price of $29.19 per  barrel,
the spot  price in effect as of the last day of  September  2003 for West  Texas
Intermediate  crude at Cushing,  Oklahoma.  This price for oil was held constant
throughout the producing life of the property.

Volumes  of oil  produced  and sold  during  calendar  2003 as well as  revenues
received were utilized to determine a relationship between wellhead revenues for
the  subject  properties  and the posted  price for oil.  This  relationship  or
differential  to posted prices was determined for each of the subject leases and
is reflected in the effective product price in the report.

Pricing  for Natural  Gas - There were no volumes of natural  gas  forecast  for
recovery from the subject properties.

Operating Costs - Operating costs are based upon  information  provided and were
kept constant throughout the producing life of the properties.

FUTURE NET INCOME

Future net  income is based  upon  gross  income  from  future  production  less
operating expenses (as previously  described) and taxes (production,  severance,
ad valorem or other).  No estimated  future capital for development and workover
costs was taken into  account for this  evaluation.  No  allowance  was made for
depletion, depreciation, income taxes or miscellaneous administrative expenses.

Neither  the cost to  abandon  these  properties  nor the  salvage  value of any
associated equipment was considered in this report.

Future net income has been  discounted  for  determination  of present  worth at
values  ranging from 0 to 100 percent  using  monthly  discounting.  The primary
discount  rate used in this report to  determine  present  value from future net
income is ten (10) percent.

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Cadence Resources Corporation                                    January 9, 2004
Waggoner Estate Properties                                                Page 5
Appraisal of Reserves and Future Net Income
Effective Date - October 1, 2003


GENERAL

Mr. Ken Davis has provided  access to various well data,  production and revenue
information. The ownership interests, product classifications relating to prices
and other factual data were accepted as furnished without verification.

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.

If  investments  or  business  decisions  are to be made in  reliance  on  these
estimates by anyone other than our client,  such person with the approval of our
client is  invited to arrange a visit so that he can  evaluate  the  assumptions
made and the  completeness  and  extent  of the  data  available  on  which  the
estimates are made.

This  report  has been  prepared  for the  exclusive  use of  Cadence  Resources
Corporation  and shall not be  reproduced,  distributed or made available to any
other  company  without  Davis's  written  consent.  Such  consent  will  not be
unreasonably withheld if the report is utilized in its entirety.

Neither  Davis nor any of its  employees  have any  interest  Cadence  Resources
Corporation or any other related  companies or the properties  reported  herein.
The  employment  and the  compensation  to prepare this study are not contingent
upon our estimates of reserves and associated economic values.

                                          Very truly yours,
                                          RALPH E. DAVIS ASSOCIATES, INC.


                                          /s/ Joseph Mustacchia, Jr.
                                          Joseph Mustacchia, Jr.
                                          Executive Vice President