Liquidated Damages Pertaining to May 11 Gas Day

Matt

I am passing on these penalties for non-performance Friday for the
firm volumes that did not flow. The firm sales amount of which you did not
perform was 5000 mmbtu at $6.90. Gas daily reported that the weekend
traded as low as $3.70. Therefore, we are assessing liquidated damages in
the amount of US$16,000, the amount of which Lisa Feisst will invoice. I
would like to ensure that this problem does not happen again. Wildgoose is
not the swing market, and all transactions completed on your screen are firm
as are all transactions, unless otherwise specified, with Wildgoose and
Alberta Energy Company. We, at Alberta Energy Company consider this a
serious matter, not the dollar figure associated but the implications in the
California market place and are treating it as such. Our companies have had
a longstanding relationship and we would like rectify this problem so we can
regain trading together in the future. A letter outlining the above will be
sent to yourself and John Lavorado for your records.

Thanks