HIGHLIGHTS

- Year-end 2006 net Proved plus Probable reserves increased 11% to 149.2 billion cubic feet of natural gas equivalent (Bcfe) compared to 123.6 Bcfe at year-end 2005, resulting in a Proved plus Probable reserves replacement of 813%

- Year-end 2006 net Proved reserves increased 11% to 89.6 Bcfe compared to 80.1 Bcfe at year-end 2005, resulting in a Proved reserves replacement of 298%

- 2006 net production totaled 3.02 Bcf natural gas and 22.6 thousand barrels of condensate, or 3.15 Bcfe, compared to 3.53 Bcfe produced in 2004, a decrease of 11%

RESERVES

The December 31, 2006 reserve report was prepared utilizing the methodology and definitions as set out under National Instrument 51-101 ("NI 51-101") and standards contained in the Canadian Oil and Gas Evaluation Handbook. Under NI 51-101, proved reserve assignments are based on a 90 percent probability that total quantities recovered will equal or exceed proved reserve estimates. Proved plus probable reserves are the expected case where there is an equal chance that the Proved plus Probable reserves will be higher or lower than estimated.

The year-end reserves for 2006 and 2005 presented include company working interests before and net after royalties and using forecast and constant price and cost assumptions. Where amounts and volumes are expressed on a gas equivalent basis, liquids volumes have been converted to cubic feet of gas at a ratio of 6,000 cubic feet of gas per barrel (6 Mcf/bbl). A conversion ratio of one bbl to six Mcf is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent equivalency at the wellhead. -- www.cnxmarketlink.com