Edson Property - Alberta

The Edson Property is located approximately 209 kilometers west of Edmonton, Alberta and encompasses over 26,560 gross (net 3,984) acres, of which 9,600 gross (net 1,440) acres are currently undeveloped. Franco-Nevada has a 15% overriding royalty in this property. The wells are operated by CNRL. For the 11 days ended December 31, 2007 the property produced approximately 4.4 MMcf/d of natural gas and 218 Bbls/d of NGL's totalling 945 Boe/d of production net to the Oil & Gas interests from 121 gross (net 18.2) producing gas wells mainly from the Upper Cretaceous Cardium Formation, with lesser amounts from the Viking, Cadomin and Bluesky Formations. As of December 31, 2007, net proved reserves to the Oil & Gas Interests were 1,734 Mboe.

Gas is processed at the CNRL operated Galloway, Edson West and Ansell gas plants which extract natural gas liquids. These plants have a combined processing capacity of 146 MMcf/d. The main reserves-bearing formation in the Edson property area is the Upper Cretaceous Cardium Formation. The Edson property lies in an area of northwest-southeast trending fault traces where the faults ramp up through the Cardium Formation. The faults dip to the west. The best Cardium wells, both vertical and especially horizontal, have targeted the hanging wall of the updip leading edge of Cardium sand cycles. This potentially helps the wells take advantage of the better productivity associated with narrow areas of higher fracture density induced by the higher stresses related to deformation along the leading edges of the faults.