Management Factors

Rio Vista is engaged in multiple acquisition, disposition and financing transactions, as well as ongoing operations in Texas, Virginia and Mexico.  The General Partner has limited management resources to oversee these operations and transactions.  Rio Vista has limited experience managing the Virginia operations which were acquired in July 2007.  Rio Vista has not previously operated exploration and production (E&P) assets such as the Oklahoma Assets proposed to be acquired.  These limitations may adversely affect Rio Vista’s ability to execute its business strategy.  The General Partner’s chief financial officer, Ian T. Bothwell, is currently also serving as acting president and acting chief executive officer.  Rio Vista is dependent upon the services of Mr. Bothwell and members of the board of directors of Penn Octane and the board of managers of the General Partner of Rio Vista. The loss of the services of any of these individuals could have a material adverse effect upon Rio Vista. The General Partner currently does not have an employment agreement with Mr. Bothwell or key man life insurance

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