WORD ON NATURAL GAS

Demand
Natural gas has a healthy outlook for years to come. The United States is the world’s largest consumer and forecasters agree that the demand will continue to increase for decades. That bodes well for the price of natural gas, particularly as there are concerns about supply.

Seasonal Cycle
Natural gas prices tend to be higher in the winter and summer due to demands for heating and air conditioning. Prices are largely set by the NYMEX exchange based on perceptions of supply and demand.

Price Volatility
Severe winters on the East Coast or Southern United States can force the price of Natural Gas up substantially driven by major buyers such as utilities and major industries. The same supply concerns support prices during the summer air conditioning and gas storage injection season.

Supply
Many gas fields in North America are mature with decreasing annual production. New wells are producing less gas and production rates are declining faster than in the past. Over the next 10 - 20 years analysts predict that new higher cost sources of supply will be required.

The Company
It is Altima’s intent to position the Company in areas where large natural gas reserves with high liquid content from multiple formations remain to be discovered.