Pine Cliff’s producing property is located in the Sundance area of West Central Alberta. The Company has a 13.2% average working interest in 4,320 acres (572 net) of Crown land in the area. There were initially two producing wells (0.308 net) on the lands when they were acquired.

Since the acquisition three more wells (0.226 net) were drilled on the lands with all three wells being productive for a 100% success rate. Two of the new drills (0.188 net) are on production and the third well (0.038) is completed and on production in early February 2006. The wells produce from multiple zones from the Cadomin to the Belly River. Current production from the four wells is approximately 3,150 Mcf/day gross, 365 Mcf/day net to Pine Cliff. NGL’s are produced in association with the natural gas.

There is still significant industry activity in the Sundance area. With the success of last years drilling program the interests in non producing properties are being analyzed to determine whether there are additional prospective drilling locations.

Pine Cliff drilled a 100% Devonian well for sweet natural gas in the Auburndale area of East Central Alberta in 2005. Gas was encountered but production rates were not sufficient enough to justify the cost of tieing in the well at this time due to lack of nearby infrastructure. The company is continuing to evaluate the potential of this play.

More detailed information may be found in the prospectus on the financial section of this website.