Western AB
September 30, 2010

The Cardium Resource Play covers a significant area of western Alberta and, because of the areal extent, potential for multiple zones and complex mineral rights composition, it provides significant oil reserves opportunity for a wide range of operators. Canadian Discovery has defined the ‘halo’ region(s) by subdividing the Cardium into six complex types: three ‘halo’ subdivisions and three ‘conventional’ subdivisions with potential new and incremental recoverable reserves assigned to each of the units. A total of approximately 1.1 billion barrels of ‘new’ unconventional hydrocarbon recovery is composed of 952 million boe of new resource hydrocarbons and 147 million barrels of incremental hydrocarbons from existing conventional pools. Reserve estimates per well are currently not well-established, and a range of ultimate recoveries are offered by various operators and analysts. Canadian Discovery conservatively estimates that a typical volume per well would be in the order of 90,000 to 120,000 boe per well and four wells per section could be drilled. Geophysical review suggests that area-specific forward modeling may assist in the planning stages for seismic acquisition, and 3D seismic may be useful in stratigraphic definition and refinement in some areas.