Fairborne commenced operations as a private company in May, 2002 with the purchase of approximately 2,400 barrels of oil equivalent per day (“BOE/d”). Our first year of operations saw production increase to 3,000 BOE/d. In July 2003, Fairborne purchased Pivotal Energy Ltd., a publicly listed oil and gas company, and also began trading on the Toronto Stock Exchange under the symbol ‘FEL’, exiting 2003 with production levels of 5,300 BOE/d.

In March 2004, Fairborne acquired a significant asset base in the West Pembina/Brazeau area of Alberta from BP Canada. This asset transaction created a new core area of operations for Fairborne, with stable cash flow, owned infrastructure, and a large undeveloped land base (Columbia/Harlech).

In July 2004, Fairborne purchased Case Resources Ltd. through an arrangement agreement. The Case assets were located in proximity to Fairborne’s existing holding and were heavily weighted towards oil, primarily from the Haynes property, thus creating better product balance to Fairborne.

During the final half of 2004 and throughout 2005, Fairborne’s technical professionals generated an extensive list of opportunities which led to a robust exploration and development drilling program. Successful drilling during this time period in both Fairborne’s core and exploration areas (Columbia/Harlech, Clive CBM and Peace River Arch; Wild River and Deep Basin) led to significant production and reserves growth which allowed Fairborne to exit 2004 with daily production of 11,700 BOE/d, up 121% over 2003 exit rates.

Following the conversion of Fairborne Energy Ltd. into Fairborne Energy Trust (and Fairquest Energy Limited) in June 2005, Fairborne Energy Trust’s production was 11,000 BOE/d.

For the 4 month period from inception in June through the third quarter of 2005, Fairborne Energy Trust successfully grew production from 11,000 to 11,500 BOE/d.

In June, 2007 Fairborne Energy trust completed the aquisition of all of the outstanding common shares of Fairquest pursuant to a plan of arrangement. Production from the combined entity was in line with previously reported levels of 13,000 - 13,500 BOE/d. The Trust operated on the basis that distibutions and capital expenditures were approximately equial to its cash flow. The Trust's net debt upon completion of the transaction was approximately $165 million, before convertible debentures, on a new borrowing base of $220 million.

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In December 2007, Fairborne Energy Trust announced completion of the plan of arrangement in which the Trust has been converted into a growth oriented exploration and production company and the issuance by Fairborne Energy of approximately 13.4 million common shares of Fairborne Energy to Denham Commodity Partners Fund IV LP, at a subscription price of $7.45 per share, for aggregate proceeds of approximately Cdn$100 million. We are listed on the Toronto Stock Exchange under the symbol ‘FEL’.

The Arrangement was overwhelmingly approved by over 98% of the votes cast by securityholders of the Trust at a special meeting of securityholders held on December 18, 2007. Holders of Trust units are entitled to receive an equal number of Common Shares and previous holders of exchangeable shares of Fairborne Energy are entitled to receive Common Shares based on the exchange ratio in effect on completion of the Arrangement. Fairborne Energy also announced the appointment of Carl J. Tricoli to the board of directors of Fairborne Energy. Mr. Tricoli is the senior managing director of Denham Capital Management LP. Denham Capital Management LP is a private equity firm focused on the global energy and commodities sectors, including natural resources, power and utilities and energy related infrastructure and services. Denham acquired the Common Shares for strategic purposes in order to participate in the western Canadian oil and natural gas sector.

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Production for the first quarter of 2008 averaged approximately 12,689 boe per day compared to 13,005 boe per day in the fourth quarter of 2007 and 10,308 boe per day in the first quarter of 2007.

Fairborne has established its 2008 capital investment program of $208 million. Approximately 74 percent will be directed toward drilling and completions and includes the drilling of between 80 to 85 net wells.