We enter into commodity price contracts to actively manage risk associated with price volatility to protect adjusted cash flow from operations required to fund our capital program.  We use fixed price and costless collar contracts as well as balancing physical and financial contracts in terms of volumes, timing of performance, and delivery obligations to manage risk.  Net open positions may exist or may be established to take advantage of market conditions.  Net earnings for the year ended December 31, 2007, include realized and unrealized loss of $1.6 million (2006 - $65.0 million gain) on these transactions.

 

The following table outlines commodity hedge transactions in place at December 31, 2007 together with transactions entered into subsequent to the year end:

 

    Term Volume Average Price Index
Natural gas
    Collar
    Collar
    Fixed
    Collar
    Fixed
  
Nov. 2007 - Mar. 2008
Apr. 2008 - Oct. 2008
Apr. 2008 - Oct. 2008
Nov. 2008 - March 2009
Nov. 2008 - March 2009

9,524 mcf/d
52,381 mcf/d
19,048 mcf/d
28,571 mcf/d
9,524 mcf/d
$8.27 - $10.50
$7.33-$8.48
$7.86
$8.40 - $10.00
$8.51
AECO
AECO
AECO
AECO
AECO
Crude oil
    Collar		   March 2008 - Dec. 2008 1,000 bbls/d U.S.$93.00 WTI