Petrobank evaluating and planning

Calgary, AB – August 31, 2005: Petrobank Energy and Resources Limited is announcing that its exploratory coalbed gas well drilled in 2004 continues to show encouraging results. The company is conducting extensive evaluations before proceeding with further development.

“Producing natural gas from coal is a complex process and we are taking time to properly evaluate our findings from our first well,” said Gregg Smith, Vice President, Canada for Petrobank. “A technical review with our project partners is underway. The findings will help us map out our next steps and we are optimistic the data will be completely evaluated by mid-October.”

Petrobank has noted that test production of the well has seen very little water production associated with the gas. The company remains committed to its promise to manage water within the guidelines and regulations of the province. Water from the initial well was trucked and disposed into a deep injection well in Alberta.