2008 First Quarter Performance

Accomplishments / Financial Update • Cash flow from operating activities for the quarter was $209.9 million ($0.98 per unit). Using the more traditional non-GAAP measure of Cash Flow that excludes changes in non-cash working capital and site restoration spending for the quarter, the Cash Flow was $227.4 million ($1.06 per unit). The 2008 first quarter Cash Flow increased 24 per cent over the $183.8 million reported in the first quarter of 2007. The increase is as a result of a 48 per cent increase in the Trust’s realized oil price for the quarter and a four per cent increase in production volumes. • The Trust posted record production for the quarter at 66,976 boe per day, up 2,801 boe per day (4.4 per cent) over the first quarter of 2007. These production volumes were achieved from internal, organic development of the Trust’s properties as no major acquisitions have been completed since December 2005. The most significant areas with increased production were at Dawson and southeast Saskatchewan. The Trust expects a decrease in second quarter production as a result of large-scale turnarounds that have been scheduled for some of the Trust’s facilities. • Total capital spending for the quarter including undeveloped land and net property acquisitions of $38.9 million was $121.4 million. This amount was funded 89 per cent by the Trust’s cash flow from operating activities and proceeds from the distribution re-investment program (“DRIP”). • During the first quarter of 2008, the Trust spent $20.3 million on development of its resource play inventory. In the greater Dawson area, ARC has spent $16.6 million (excluding the cost of land purchases) of the $85 million that was budgeted for the area in 2008. Four horizontal infill wells were drilled in the quarter and are expected to be completed during the second and third quarters of 2008. In addition, the Trust drilled two vertical delineation wells at Dawson. At Sunrise, the Trust began shooting seismic and tested commercial quantities of gas from its 9-13 discovery well. The Trust spent $13.6 million to add seven gross (4.5 net) sections of land contiguous with the 15 sections of land the Trust purchased in 2007. The Trust also expanded its land base at Sundown by pooling its 18 sections of land with 7 sections of land on a pro-rata basis - consequently the Trust now owns a 72 per cent working interest in 25 sections of land. The pooling provides ARC with exposure to additional lands while offsetting some of the exploration risk. The result of these and other land purchases are that as of March 31, 2008 the Trust has an interest in 120 sections of undeveloped land (100 sections net) in the Montney play in British Columbia, this is up from 96 sections of undeveloped land (87 sections net) at year-end 2007. The Board approved an additional $40 million of capital for the Dawson area, increasing the 2008 budget for this area to $125 million. • The Trust spent $10 million during the first quarter of 2008 on enhanced oil recovery (“EOR”) initiatives, including development capital for the Weyburn and Midale CO2 floods in Saskatchewan. The Trust has been actively working on the CO2 pilot project at Redwater and is on schedule to begin injecting CO2 mid-year 2008. We expect that it will take 12 to 18 months before we know if the pilot has been successful • At March 31, 2008, the Trust had net debt of $770.1 million that represents 12 per cent of ARC’s total capitalization of $6.4 billion and a ratio of 0.9 for net debt to annualized cash flow from operating activities. This balance sheet strength has positioned the Trust to be able to take advantage of accretive acquisition opportunities and an aggressive capital program for the remainder of 2008. • In light of the strong commodity price environment, the Board of Directors have re-affirmed our base distribution of $0.20 per unit and have approved a monthly “top-up” distribution of four cents per unit. This will bring ARC’s total distribution to $0.24 cents per month. The “top-up” distribution will be reviewed on a quarterly basis but is expected to stay in place as long as commodity prices maintain their current strength. • Including first quarter land purchases and the $40 million of incremental capital being allocated to delineating the Trust’s undeveloped Montney lands in northeast British Columbia, the Trust’s 2008 capital budget has been increased from $395 million to $470 million. • The Trust distributed $125.8 million in the fourth quarter of 2007 with full year distributions of $498 million. The Trust announced 2008 first quarter distributions will remain at $0.20 per unit per month, a level that has been maintained since October 2005. Since inception in 1996, the Trust has distributed $21.03 per unit for a total of $2.66 billion. • Subsequent to year-end 2007, ARC purchased a 50 per cent working interest in five sections of land at Sunrise in northeastern British Columbia that are contiguous to the lands purchased during 2007. •  It is with much regret and sadness that we announce that ARC has lost an important member of its Board of Directors. Mr. Fred Coles passed away on May 1, 2008. He was a member of ARC’s Board since inception and contributed his wealth of knowledge and experience to ARC and the community at large. His contribution to ARC’s Board will be missed. For more please click here. To download a full pdf of Q1 Results please click here.