Production Summary

Production Growth Expected in 2010

Production volumes averaged 63,538 boe per day in 2009 compared to 65,126 boe per day in 2008. Light and medium crude oil production decreased to 26,423 boe per day compared to 27,239 boe per day in 2008, while heavy oil production declined by 188 boe per day. Compared to 2008, the total crude oil production is down approximately 1,000 barrels per day. Natural gas production was 194 mmcf per day in 2009, a decrease of one per cent from the 196.5 mmcf per day produced in 2008. This slight decline was primarily due to plant turnarounds completed at third party facilities that shut-in gas production.

ARC’s objective is to maintain annual production through the drilling of wells and other development activities to the full extent possible, while giving consideration to capital spending constraints and the economics of developing ARC’s resources. In fulfilling this objective, there may be fluctuations in production depending on the timing of new wells coming on-stream. During 2009, ARC drilled 145 gross wells (120 net wells) on operated properties; 37 gross oil wells, and 108 gross natural gas wells with a 99 per cent success rate.

2010 Outlook
ARC expects that 2010 full year production will average approximately 70,500 to 72,500 boe per day and that a total of 211 gross wells (195 net) will be drilled by ARC on operated properties with participation in an additional 91 gross wells (18 net) to be drilled on ARC’s non-operated properties. ARC estimates that the 2010 drilling program and the start-up of a new gas plant in the Dawson area will increase production in 2010 by 11 per cent to 14 per cent over 2009 production levels. The planned capital expenditures for 2010 have been increased to approximately $610 million from actual expenditures of $360 million in 2009, which were scaled back from an original 2009 planned budget of $585 million due to the significant decline in commodity prices.

Operational Highlights

Property Summary

(Boe @ 6:1)
The following table summarizes the Trust's production by core area for the six months ended June 30, 2009.

(1) Provincial references: AB is Alberta, B.C. is British Columbia, MB is Manitoba and Sask. is Saskatchewan.