Artek Exploration

Operations Review

Artek Exploration Ltd. has a full spectrum of geological, geophysical as well as operations, reservoir and production engineering expertise required to compete in its core operating areas. The Company utilizes the appropriate geosciences and engineering technology, combined with the multi-zone nature of its focus areas, to mitigate risk inherent in its drill bit growth strategy.

Strategy

Key elements of Artek's exploration and development growth strategy include:

• Drill Bit Driven - maximizing (>80%) capital towards drilling, completion, equipping and tie-in operations supplemented by strategic acquisitions where the Company has a technical competitive advantage.
• Multiple Zone Areas - investing in a balance of conventional and resource natural gas plays that have light crude oil and natural gas liquids potential, thereby managing risk, capital and netbacks.
• Balanced Risk - focusing on medium depth (1,200 - 3,500 metres)/moderate risk plays (75 - 80%) and exploratory high risk/high impact play types (20 - 25%).
• Geographic Selection - targeting less mature area of Alberta's Peace River Arch through the Deep Basin in the Noel, British Columbia region that is characterized by multi-zone targets from the mid-Cretaceous to the Mississippian and Devonian formations.
• Internally Generated Prospects/Inventory - establishing significant land positions through Crown sales and multi-well farm-in opportunities with reputable industry partners.
• Maximize Working Interests - maintaining operatorship and investing in areas with competitive infrastructure to control costs and on-stream timing.

Core Operating Areas

• Peace River Arch, Alberta
• 3 exploration areas: Beaton, Dunvegan, Pouce Coupe
• 450 - 500 boe/d average production during January 2011
• 46,000 net acres of land

• Deep Basin, British Columbia / Alberta
• 3 exploration areas: Noel/Tupper, Elmworth, Sinclair
• 700 - 800 boe/d average production during January 2011
• 47,000 net acres of land

• Inga/Fireweed, British Columbia
• 2 exploration areas: Inga, Fireweed
• 500 - 550 boe/d average production during January 2011
• 12,000 net acres of land

• Central Alberta
• 1 exploration area: Leduc Woodbend
• 550 - 570 boe/d average production (>90% light crude oil and liquids) during January 2011
• 2,400 gross acres