At our Greater Sierra resource play in northeast British Columbia (B.C.), we are focused on the continued development of the Jean Marie geological formation and on the successful completion of the commercial pilot program in the Horn River Basin.

With the introduction of a year-round drilling program in 2008, we were able to drill over 100 wells in this area using five percent less capital than in 2007. Using multi-leg, horizontal drilling technology, to date we have developed approximately 30 percent of our two million net acres in the Jean Marie formation.

At the end of 2008, we had approximately 260,000 net acres in the emerging Devonian Shale formation of the Horn River. The Horn River formation shales (Muskwa, Otter Park and Evie) in our focus area are up to 500 feet thick. We evaluated the potential of these shales by drilling 15 test wells (five vertical and ten horizontal). Nine of these wells were placed on long-term production (one vertical and eight horizontal).

Our plans for 2009 include drilling horizontal wells in the Two Island Lake area, construction of a compressor station and construction of a 24-inch gas transmission pipeline.

At Greater Sierra in 2008:

• we drilled 106 net wells
• we produced on average 220 million cubic feet per day (MMcf/d) of natural gas