What started as a four-wells-per-section drilling program in 1990, grew to a point where in 2006 we commenced a program to drill up to 16 wells per section in some areas over the next few years. This means drilling about 300 new wells per year, or a total of 1,400 new wells drilled along with the associated infrastructure. Our existing wells gather gas through pipelines into 14 central sales compressor sites and six stand-alone booster sites. Our plans require upgrading the entire pipeline system.

In short, we are, and will be for the foreseeable future, very active in the area, moving machinery, drilling, laying pipelines and disturbing the local ecosystems. The area is one of the largest remaining areas of native prairie, a threatened ecosystem and home to several species of plants listed under the federal Species at Risk Act. In addition, the declining rattlesnake population is a concern to local landowners.

The success of our business strategy relies on being the “Operator of Choice” in all areas in which we work. This starts with a commitment to apply what we consider to be best practices to reduce our impact on the land and our stakeholders. Each drilling phase requires environmental impact studies, design planning and extensive discussion and consultation with regulators and area stakeholders.

Once we have our approvals, the development process begins with evaluating well locations, pipelines and road access routes through consultation with landowners and lease holders. Using a process called constraints mapping, we incorporate environmental sensitivities such as wetland or watercourse crossings, wildlife habitat and rare plant locations into our site selection for wells, roads and pipelines. We continuously modify the well designs, locations and drilling schedules to avoid snake migration paths or the nests of burrowing owls.

A responsible drilling operation means demonstrating our commitment to Zero-Harm. For our own safety and the safety of the community, we choose not to move our rigs after dark. We use smaller, more compact rigs and only move equipment if the ground is dry or frozen, to minimize soil damage.

Promoting effective relationships with landowners, local communities, regulators and environmental advocacy groups is equally important to the success of this project. We provide timely and complete information on our project development plans, as well as hosting forums for two-way dialogue. We produced a Medicine Hat Development Plan in 2007, which we will update in 2008, that informs stakeholders of the planned development program, timing, proposed drilling activity, well completions and testing operations, operational guidelines, an environmental overview and Company contact information. Our annual newsletter highlights issues of local interest and provides an update on the various projects and the commitments that we have made. An open house, hosted each spring in Medicine Hat, is an opportunity for stakeholders to meet us and pose their questions directly to us.

As a corporate member of the local community, we recognize the need to give back to the communities in which we operate. Over several years, we have made various contributions such as: a donation to the Medicine Hat Regional Hospital for the purchase of colonoscopy equipment; sponsored the 23^rd Biennial Pronghorn Antelope Workshop; and, funded the Sustainable Grasslands Applied Research Program.