<PAGE>

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2004

                                                        OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934 FOR THE
     TRANSITION PERIOD FROM ______________ TO ________________

                         Commission file number 0-29370

                              ULTRA PETROLEUM CORP.
             (Exact name of registrant as specified in its charter)

    Yukon Territory, Canada                           N/A
(State or other jurisdiction of                  (I.R.S. employer
incorporation or organization)                identification number)

363 North Sam Houston Parkway, Suite 1200, Houston, Texas          77060
          (Address of principal executive offices)               (Zip code)

                                 (281) 876-0120
                         (Registrant's telephone number,
                              including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

YES [X] NO [ ]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act)

YES [X] NO [ ]

The number of common shares, without par value, of Ultra Petroleum Corp.,
outstanding as of April 28, 2004 was 74,953,768.

<PAGE>

                         PART 1 - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

(Expressed in U.S. Dollars)

                              ULTRA PETROLEUM CORP.
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                           For the Three Months Ended
                                                                    March 31,
                                                         ------------------------------
                                                             2004              2003
                                                         ------------      ------------
<S>                                                      <C>               <C>
Revenues:
     Natural gas sales                                   $ 46,077,223      $ 23,122,589
     Oil sales                                              2,541,550         1,548,506
                                                         ------------      ------------
                                                           48,618,773        24,671,095

Expenses:
     Production expenses and taxes                          9,724,897         5,201,744
     Depletion and depreciation                             5,480,720         3,605,846
     General and administrative                             1,554,039         1,237,703
     General and administrative - stock compensation          100,023           612,500
                                                         ------------      ------------
                                                           16,859,679        10,657,793

Operating income                                           31,759,094        14,013,302

Other income:
     Interest expense                                      (1,100,170)         (653,600)
     Interest income                                           12,734             8,578
                                                         ------------      ------------
                                                           (1,087,436)         (645,022)

Income for the period, before income tax provision         30,671,658        13,368,280

Income tax provision - deferred                            10,888,440         5,146,788
                                                         ------------      ------------

Net income for the period                                  19,783,218         8,221,492
Retained earnings, beginning of period                     56,138,516        10,815,877
                                                         ------------      ------------
Retained earnings, end of period                         $ 75,921,734      $ 19,037,369
                                                         ============      ============
Income per common share - basic                          $       0.26      $       0.11
                                                         ============      ============
Income per common share -  diluted                       $       0.25      $       0.11
                                                         ============      ============
Weighted average common shares outstanding - basic         74,757,345        74,056,840
                                                         ============      ============
Weighted average common shares outstanding - diluted       79,749,833        77,950,668
                                                         ============      ============
</TABLE>

                                                                               2

<PAGE>

                              ULTRA PETROLEUM CORP.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

(Expressed in U.S. Dollars)

<TABLE>
<CAPTION>
                                                        Three Months Ended
                                                             March 31,
                                                   ------------------------------
                                                      2004              2003
                                                   ------------      ------------
<S>                                                <C>               <C>
Cash provided by (used in):

Operating activities:
Net income for the period                          $ 19,783,218      $  8,221,492
Add (deduct)
   Items not involving cash:
     Depletion and depreciation                       5,480,720         3,605,846
     Deferred income taxes                           10,888,440         5,146,788
     Stock compensation                                 100,023           612,500
Net changes in non-cash working capital:
   Restricted cash                                         (314)             (362)
   Accounts receivable                                  618,011        (2,568,487)
   Inventory                                          1,127,989                --
   Prepaid expenses and other current assets          1,253,614          (344,307)
   Accounts payable and accrued liabilities         (16,106,026)         (727,500)
   Other long-term obligations                        3,716,429           132,122
                                                   ------------      ------------
                                                     26,862,104        14,078,092

 Investing activities:
   Oil and gas property expenditures                (34,988,848)       (9,115,658)
   Change in capital cost accrual                    (7,077,620)         (661,733)
   Purchase of capital assets                          (109,644)          (31,137)
                                                   ------------      ------------
                                                    (42,176,112)       (9,808,528)

Financing activities:
   Borrowings on long-term debt, gross               24,000,000         1,000,000
   Payments on long-term debt, gross                 (9,000,000)       (5,000,000)
   Proceeds from exercise of options                    403,406           146,140
                                                   ------------      ------------
                                                     15,403,406        (3,853,860)

Increase in cash during the period                       89,398           415,704
Cash and cash equivalents, beginning of period        1,834,112         1,417,711
                                                   ------------      ------------
Cash and cash equivalents, end of period           $  1,923,510      $  1,833,415
                                                   ============      ============
</TABLE>

                                                                               3

<PAGE>

                              ULTRA PETROLEUM CORP.
                           CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)

(Expressed in U.S. Dollars)

<TABLE>
<CAPTION>
                                                               March 31,         December 31,
                                                                 2004               2003
                                                             -------------      -------------
<S>                                                          <C>                <C>
Assets

Current assets
     Cash and cash equivalents                               $   1,923,510      $   1,834,112
     Restricted cash                                               210,983            210,669
     Accounts receivable                                        18,730,850         19,348,861
     Inventory                                                  12,461,281         13,589,270
     Prepaid expenses and other current assets                     458,123          1,711,737
                                                             -------------      -------------
                                                                33,784,747         36,694,649

Oil and gas properties, using the full cost method of
  accounting                                                   337,577,845        307,863,722
Capital assets                                                   1,165,930          1,212,006
                                                             -------------      -------------

Total assets                                                 $ 372,528,522      $ 345,770,377
                                                             =============      =============

Liabilities and shareholders' equity

Current liabilities
   Accounts payable and accrued liabilities                  $  16,275,648      $  28,134,391
   Capital cost accrual                                         23,539,292         30,616,912
   Long-term debt                                              114,000,000         99,000,000
   Deferred income taxes                                        43,005,726         33,446,131
   Other long-term obligations                                   8,836,642          5,120,213

Shareholders' equity
     Share capital                                              97,901,902         97,448,221
     Treasury stock                                             (1,193,650)        (1,193,650)
     Other comprehensive loss - fair value of derivative
     instruments                                                (5,758,772)        (2,940,357)
     Retained earnings                                          75,921,734         56,138,516
                                                             -------------      -------------
                                                               166,871,214        149,452,730
                                                             -------------      -------------
Total liabilities and shareholders' equity                   $ 372,528,522      $ 345,770,377
                                                             =============      =============
</TABLE>

                                                                               4
<PAGE>

ULTRA PETROLEUM CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(All dollar amounts in this Quarterly Report on Form 10-Q are expressed in U.S.
dollars unless otherwise noted)

DESCRIPTION OF THE BUSINESS:

Ultra Petroleum Corp. (the "Company") is an independent oil and gas company
engaged in the acquisition, exploration, development, and production of oil and
gas properties. The Company was incorporated under the laws of British Columbia,
Canada. On March 1, 2000, the Company was continued under the laws of the Yukon
Territory, Canada. The Company's principal business activities are in the Green
River Basin of Southwest Wyoming and Bohai Bay, China.

1. SIGNIFICANT ACCOUNTING POLICIES:

The accompanying financial statements, other than the balance sheet data as of
December 31, 2003, are unaudited and were prepared from the Company's records.
Balance sheet data as of December 31, 2003 was derived from the Company's
audited financial statements, but do not include all disclosures required by
U.S. generally accepted accounting principles. The Company's management believes
that these financial statements include all adjustments necessary for a fair
presentation of the Company's financial position and results of operations. All
adjustments are of a normal and recurring nature unless specifically noted. The
Company prepared these statements on a basis consistent with the Company's
annual audited statements and Regulation S-X. Regulation S-X allows the Company
to omit some of the footnote and policy disclosures required by generally
accepted accounting principles and normally included in annual reports on Form
10-K. You should read these interim financial statements together with the
financial statements, summary of significant accounting policies and notes to
the Company's most recent annual report on Form 10-K.

(a) Basis of presentation and principles of consolidation:

The consolidated financial statements include the accounts of the Company and
its wholly owned subsidiaries UP Energy Corporation, Ultra Resources, Inc., and
Sino-American Energy Corporation. The Company presents its financial statements
in accordance with accounting principles generally accepted in the United States
("US GAAP"). All material inter-company transactions and balances have been
eliminated upon consolidation.

(b) Accounting principles:

The consolidated financial statements are prepared in accordance with accounting
principles generally accepted in the United States.

(c) Cash and cash equivalents:

The Company considers all highly liquid investments with an original maturity of
three months or less to be cash equivalents.

(d) Restricted cash:

Restricted cash represents cash received by the Company from production sold
where the final division of ownership of the production is unknown or in
dispute. Wyoming law requires that these funds be held in a federally insured
bank in Wyoming.

(e) Capital assets:

Capital assets are recorded at cost and depreciated using the declining-balance
method based on a seven-year useful life.

(f) Oil and gas properties:

The Company uses the full cost method of accounting for oil and gas operations
whereby all costs associated with the exploration for and development of oil and
gas reserves are capitalized to the Company's cost centers. Such costs include
land acquisition costs, geological and geophysical expenses, carrying charges on
non-producing properties, costs of drilling both productive and non-productive
wells and overhead charges directly related to acquisition, exploration and
development activities. The Company conducts operations in both the United
States and China. Separate cost centers are maintained for each country in which
the Company has operations.

The capitalized costs, together with the costs of production equipment, are
depleted using the units-of-production method based on the proven reserves as
determined by independent petroleum engineers. Oil and gas reserves and
production are converted into equivalent units based upon relative energy
content.

Costs of acquiring and evaluating unproved properties are initially excluded
from the costs subject to depletion. These unproved properties are assessed
periodically to ascertain whether impairment has occurred. When proved reserves
are assigned or the property is considered to be impaired, the cost of the
property or the amount of the impairment is added to the costs subject to
depletion.

The total capitalized cost of oil and gas properties less accumulated depletion
is limited to an amount equal to the estimated future net cash flows from proved
reserves, discounted at 10%, using year-end prices, plus the cost (net of
impairment) of unproved properties as adjusted for related tax effects (the
"full cost ceiling test limitation").

Proceeds from the sale of oil and gas properties are applied against capitalized
costs, with no gain or loss recognized, unless such a sale would significantly
alter the rate of depletion.

Substantially all of the Company's exploration, development and production
activities are conducted jointly with others and, accordingly, these financial
statements reflect only the Company's proportionate interest in such activities.

                                                                               5
<PAGE>

(g) Derivative transactions:

The Company has entered into commodity price risk management transactions to
manage its exposure to gas price volatility. These transactions are in the form
of price swaps with a financial institution or other credit worthy counter
parties. These transactions have been designated by the Company as cash flow
hedges. As such, unrealized gains and losses related to the change in fair
market value of the derivative contracts are recorded in other comprehensive
income in the balance sheet. The Company also enters into forward sales of
physical gas volumes to credit worthy purchasers which are not reflected on the
balance sheet.

(h) Income taxes:

The Company uses the asset and liability method of accounting for income taxes
under which deferred tax assets and liabilities are recognized for the future
tax consequences. Accordingly, deferred tax liabilities and assets are
determined based on the temporary differences between the financial statement
and tax basis of assets and liabilities, using the enacted tax rates in effect
for the year in which the differences are expected to reverse.

(i) Earnings per share:

Basic earnings per share is computed by dividing net earnings attributable to
common stock by the weighted average number of common shares outstanding during
each period. Diluted earnings per share is computed by adjusting the average
number of common shares outstanding for the dilutive effect, if any, of stock
options. The Company uses the treasury stock method to determine the dilutive
effect.

The following table provides a reconciliation of the components of basic and
diluted net income per common share:

<TABLE>
<CAPTION>
                                                    Three Months Ended
                                             -------------------------------
                                             March 31, 2004   March 31, 2003
                                             --------------   --------------
<S>                                          <C>              <C>
Net income                                     $19,783,218     $ 8,221,492
                                               ===========     ===========

Weighted average common shares
 outstanding during the period                  74,757,345      74,056,840

Effect of dilutive instruments                   4,992,488       3,893,828
                                               -----------     -----------

Weighted average common shares outstanding
 during the period including the effects
 of dilutive instruments                        79,749,833      77,950,668
                                               ===========     ===========

Basic earnings per share                       $      0.26     $      0.11
                                               ===========     ===========

Diluted earnings per share                     $      0.25     $      0.11
                                               ===========     ===========
</TABLE>

(j) Use of estimates:

Preparation of consolidated financial statements in accordance with US GAAP
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the financial statements, and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ
from those estimates.

(k) Reclassifications:

Certain amounts in the financial statements of the prior years have been
reclassified to conform to the current years' financial statement presentation.

(l) Accounting for stock-based compensation:

Statement of Financial Accounting Standards No. 123, "Accounting for Stock -
Based Compensation" (SFAS No. 123), defines a fair value method of accounting
for employee stock options and similar equity instruments. SFAS No. 123 allows
for the continued measurement of compensation cost for such plans using the
intrinsic value based method prescribed by APB Opinion No. 25, "Accounting for
Stock Issued to Employees" (APB No. 25), provided that pro forma results of
operations are disclosed for those options granted. The Company accounts for
stock options granted to employees and directors of the Company under the
intrinsic value method. Had the Company reported compensation costs as
determined by the fair value method of accounting for option grants to employees
and directors, net income (loss) and net income (loss) per common share would
approximate the following pro forma amounts:

                                                                               6
<PAGE>

<TABLE>
<CAPTION>
                                      Three Months Ended
                                ---------------------------------
                                March 31, 2004     March 31, 2003
                                --------------     --------------
<S>                             <C>                <C>
Net income:
          As reported           $   19,783,218     $    8,221,492
          Pro forma             $   18,918,447     $    8,221,492

Basic earnings per share:
          As reported           $         0.26     $         0.11
          Pro forma             $         0.25     $         0.11

Diluted earnings per share:
          As reported           $         0.25     $         0.11
          Pro forma             $         0.24     $         0.11
</TABLE>

For purposes of pro forma disclosures, the estimated fair value of options is
amortized to expense over the options' vesting period. The weighted-average fair
value of each option granted is estimated on the date of grant using the Black
Scholes option pricing model with an assumed expected volatility of 25% at March
31, 2004 and 2003. All options have expected lives of ten years.

2. OIL AND GAS PROPERTIES:

<TABLE>
<CAPTION>
                                                                 March 31,        December 31,
                                                                   2004              2003
                                                              -------------      -------------
<S>                                                           <C>                <C>
Developed Properties:
Acquisition, equipment, exploration, drilling and
   environmental costs                                        $ 278,980,848      $ 249,784,562
Less accumulated depletion, depreciation and amortization       (43,820,605)       (38,495,605)
                                                              -------------      -------------
                                                                235,160,243        211,288,957

Unproven Properties:
China                                                            86,167,073         80,970,244
Acquisition and exploration costs US                             16,250,529         15,604,521
                                                              -------------      -------------
                                                              $ 337,577,845      $ 307,863,722
                                                              =============      =============
</TABLE>

3. LONG-TERM DEBT:

<TABLE>
<CAPTION>
                                                                March 31,         December 31,
                                                                 2004                 2003
                                                              ------------        ------------
<S>                                                           <C>                 <C>
Bank indebtedness                                             $114,000,000        $ 99,000,000
Other long-term obligations                                      8,836,642           5,120,213
                                                              ------------        ------------
                                                              $122,836,642        $104,120,213
                                                              ============        ============
</TABLE>

The Company (through its subsidiary) participates in a long-term credit facility
with a group of banks led by Bank One N.A. The agreement specifies an aggregate
borrowing base of $200 million which was determined at December 12, 2003. At
March 31, 2004, the Company had $114 million outstanding and $86 million unused
and available on the credit facility.

The credit facility matures on March 1, 2006 and bears interest at either the
bank's prime rate plus a margin of one-half of one percent (0.50%) to one and
one-quarter percent (1.25%) based on the percentage of available credit drawn or
at LIBOR plus a margin of one and one-half percent (1.5%) to two and one-quarter
percent (2.25%) based on the percentage of available credit drawn. An average
annual commitment fee of 0.375% is charged quarterly for any unused portion of
the credit line.

The borrowing base is subject to periodic (at least semi-annual) review and
re-determination by the bank and may be decreased or increased depending on a
number of factors including the Company's proved reserves and the bank's
forecast of future oil and gas prices. If the borrowing base is reduced to an
amount less than the balance outstanding, the Company has sixty days from date
of notice to pay the difference. Additionally, the Company is subject to
quarterly reviews of compliance with the covenants under the bank facility
including minimum coverage ratios relating to interest, working capital and
advances to Sino-American Energy Corporation. In the event of a default under
the covenants, the Company may not be able to access funds otherwise available
under the facility. As of March 31, 2004, the Company was in compliance with the
covenants and required ratios of the bank facility.

The Company has secured this debt by a majority of its proved domestic oil and
gas properties.

4. DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CANADA AND
THE UNITED STATES:

In September 2003, the AcSB released revised transitional provisions for
Stock-Based Compensation and Other Stock-Based Payments, Section 3870, to
provide the same alternative methods of transition as is provided in the US for
voluntary adoption of the fair value based method of accounting. These
provisions permit either retroactive (with or without restatement) or
prospective application of the recognition provisions to awards not previously
accounted for at fair value. Prospective application is only available to
enterprises that elect to apply the fair value based method of accounting to
that type of award for fiscal years beginning before January 1, 2004.

The AcSB has also amended Section 3870 to require that all transactions whereby
goods and services are received in exchange for stock-based compensation and
other payments result in expenses that should be recognized in financial
statements, and that this requirement would be applicable for financial periods
beginning on or after January 1, 2004. Section 3870 requires that share-based
transactions should be measured on a fair value basis.

                                                                               7
<PAGE>

As described in Note 1, had the Company expensed the fair value of options
vested during the period, net income would have been reported as $18,918,447.

Recorded in other comprehensive income in the equity section of the Company's
balance sheet is an offset of $5,758,772 to a liability that measures a future
effect of the fixed price to index price swap agreements that the Company
currently has in place. The Company has recorded this in compliance with FASB
No. 133 which addresses accounting impacts of derivative instruments.

The AcSB issued a new Accounting Guideline ("Guideline"), AcG-13, Hedging
Relationships, in December 2001 in connection with amendments to CICA Handbook
Section 1650, Foreign Currency Translation. The Guideline is applicable to
hedging relationships in effect in fiscal years beginning on or after July 1,
2003 (the AcSB changed the original effective date of January 1, 2002 in its
December 2001 meeting, and further deferred the effective date in its September
2002 meeting). The Guideline is not applicable to prior periods, but requires
the discontinuance of hedge accounting for hedging relationships established in
prior periods that do not meet the conditions for hedge accounting at the date
it is first applied.

The Guideline supplements some of the requirements on accounting for hedges of
foreign currency items in Section 1650, but is equally applicable to accounting
for hedges of other types of risk exposure. The Guideline deals with the
identification, documentation, designation and effectiveness of hedges and also
the discontinuance of hedge accounting, but does not specify hedge accounting
methods.

The Guideline is intended to improve the quality and consistency of hedge
accounting under Canadian GAAP. The Guideline incorporates certain features of
the U.S. hedge accounting standards as requirements. The AcSB has attempted to
avoid creating any additional GAAP differences, i.e., requirements that prevent
an entity from adopting a U.S. requirement. However, Canadian hedge accounting
remains inconsistent with U.S. GAAP in some fundamental ways.

5. RECENT ACCOUNTING PRONOUNCEMENTS:

In January 2003, the Company adopted SFAS No. 143, Accounting for Asset
Retirement Obligations ("SFAS No. 143"). SFAS No. 143 requires the Company to
record the fair value of an asset retirement obligation as a liability in the
period in which it incurs a legal obligation associated with the retirement of
tangible long-lived assets that result from the acquisition, construction,
development and/or normal use of the assets. The Company adopted SFAS No. 143 on
January 1, 2003. Currently, the Company has deemed the impact of SFAS No. 143 to
not be material.

ITEM 2 - MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

The following discussion of the financial condition and operating results of the
Company should be read in conjunction with the consolidated financial statements
and related notes of the Company. Except as otherwise indicated all amounts are
expressed in U.S. dollars. We operate in one segment, natural gas and oil
exploration and development with two geographical segments; the United States
and China.

The Company currently generates its revenue, earnings and cash from the
production and sales of natural gas and oil from its property in southwestern
Wyoming. The price of natural gas in the southwest Wyoming region is a critical
factor to the Company's business. The price of gas in southwest Wyoming
historically has been volatile. The average annual realizations for the period
2001-2003 have ranged from $2.33 to $4.16 per Mcf. This volatility could be very
detrimental to the Company's financial performance. The Company seeks to limit
the impact of this volatility on its results by entering into derivative and
forward sales contracts for gas in southwest Wyoming. The average realization
for the Company's gas during the first quarter of 2004 was $4.95 per Mcf, basis
Opal, Wyoming, including the effect of hedges. The Company continued
participating in the development of the first two fields of the nine fields
discovered on its oil properties offshore Bohai Bay, China which are expected to
begin production in late 2004. At that time, the price of oil in east Asia would
become critical to the Company.

The Company has grown its natural gas and oil production significantly over the
past three years and management believes it has the ability to continue growing
production by drilling already identified locations on its leases in Wyoming and
by bringing into production the already discovered oilfields in China. The
Company delivered 54% production growth on an Mcfe basis during the quarter
ended March 31, 2004 as compared to the same quarter in 2003. Management expects
to deliver additional production growth during the balance of 2004 to reach the
anticipated 45% growth in annual production to 42 Bcfe, which is expected to be
achieved by drilling and bringing into production additional wells in Wyoming.

The Company uses the full cost method of accounting for oil and gas operations
whereby all costs associated with the exploration for and development of oil and
gas reserves are capitalized to the Company's cost centers. Such costs include
land acquisition costs, geological and geophysical expenses, carrying charges on
non-producing properties, costs of drilling both productive and non-productive
wells and overhead charges directly related to acquisition, exploration and
development activities. The Company conducts operations in both the United
States and China. Separate cost centers are maintained for each country in which
the Company has operations. Substantially all of the oil and gas activities are
conducted jointly with others and, accordingly, the amounts reflect only the
Company's proportionate interest in such activities. Inflation has not had a
material impact on the Company's results of operations and is not expected to
have a material impact on the Company's results of operations in the future.

RESULTS OF OPERATIONS

QUARTER ENDED MARCH 31, 2004 VS. QUARTER ENDED MARCH 31, 2003

During the quarter, production increased 54% on an equivalent basis to 9.7 Bcfe
from 6.3 Bcfe for the same quarter in 2003 primarily because of the additional
wells drilled and completed during 2003 and to a lesser extent the wells drilled
and completed during the quarter. Average realized price for natural gas
increased 29% to $4.95 per Mcf resulting in a 97% increase in revenues to $48.6
million.

Production costs increased 87% to $9.7 million primarily due to the increase in
production taxes which accounted for 66% of the increase. Production taxes are
calculated as a percentage of revenue, which percentage increased slightly to
11.7% from 10.8% in the same quarter last year, due primarily to the phasing out
of certain tax benefits. On a unit of production basis, production costs
increased 21% to $1.00 per Mcfe again attributable almost wholly to the increase
in production taxes arising from higher revenues.

                                                                               8
<PAGE>

DD&A increased in line with the increase in production while general and
administrative and stock compensation costs decreased 11% on lower stock
compensation costs associated with contractual payouts decreasing as compared to
the same quarter in 2003.

Net income before income taxes increased 129% to $30.7 million and income tax
provision-deferred increased by 112% to $10.9 million at a rate of 35.5%. Net
income increased 141% to $19.8 million or $0.25 per diluted share.

The discussion and analysis of the Company's financial condition and results of
operations is based upon consolidated financial statements, which have been
prepared in accordance with U.S. GAAP. In addition, application of generally
accepted accounting principles requires the use of estimates, judgments and
assumptions that affect the reported amounts of assets and liabilities as of the
date of the financial statements as well as the revenues and expenses reported
during the period. Changes in these estimates, judgments and assumptions will
occur as a result of future events, and, accordingly, actual results could
differ from amounts estimated.

LIQUIDITY AND CAPITAL RESOURCES

During the three month period ended March 31, 2004, the Company relied on cash
provided by operations along with borrowings under it's credit facility to
finance its capital expenditures. The Company participated in the drilling of 9
wells in Wyoming and continued to participate in the development process in the
China blocks including the ongoing batch drilling program for the development
wells. For the three-month period ended March 31, 2004 net capital expenditures
were $35 million. At March 31, 2004, the Company reported a cash position of
$1.9 million compared to $1.8 million at March 31, 2003. Working capital deficit
at March 31, 2004 was $(6.0) million as compared to $(2.4) million at March 31,
2003. As of March 31, 2004, the Company had incurred bank indebtedness of $114.0
million and other long-term obligations of $8.8 million comprised of items
payable in more than one year, primarily related to production taxes.

The Company's positive cash provided by operating activities, along with the
availability under the senior credit facility, are projected to be sufficient to
fund the Company's budgeted capital expenditures for 2004, which are currently
projected to be $190.0 million. Of the $190.0 million budget, the Company plans
to spend approximately $162.0 million of its 2004 budget in Wyoming and
approximately $25.0 million in China with the balance allocated to evaluating
other areas. Of the $162.0 million for Wyoming, the Company plans to drill or
participate in an estimated 80 gross wells in 2004, of which approximately 40%
will be for exploration wells and the remaining will be for development wells.
Of the $25.0 million budgeted for China, approximately 12% will be for
exploratory/appraisal activity and the balance will be for development activity.
The Company currently has no budget for acquisitions in 2004.

As of December 12, 2003, the revolving senior credit facility provides for a
$250.0 million revolving credit line with a current borrowing base of $200.0
million. The credit facility matures on March 1, 2006, and bears interest at
either Bank One's prime rate plus a margin of one-half of one percent (0.50%) to
one and one-quarter percent (1.25%) based on the percentage of available credit
drawn or at LIBOR plus a margin of one and one-half percent (1.50%) to two and
one-quarter percent (2.25%) based on the percentage of available credit drawn.
An average annual commitment fee of 0.375% is charged quarterly for any unused
portion of the credit line. The borrowing base is subject to periodic (at least
semi-annual) review and re-determination by the banks and may be increased or
decreased depending on a number of factors including the Company's proved
reserves and the bank's forecast of future oil and gas prices. Additionally, the
Company is subject to quarterly reviews of compliance with the covenants under
the bank facility including minimum coverage ratios relating to interest,
working capital and advances to Sino-American Energy Corporation. In the event
of a default under the covenants, the Company may not be able to access funds
otherwise available under the facility and may, in certain circumstances
including reduction in borrowing base, be required to repay the credit
facilities. The notes are collateralized by a majority of the Company's proved
domestic oil and gas properties. At March 31, 2004, the Company had $114.0
million of outstanding borrowings under this credit facility, with a current
average interest rate of approximately 3%. The Company was in compliance with
all loan covenants at March 31, 2004. The Company is currently finalizing
amendments to the Credit Facility in association with the banks' review of the
Borrowing Base. The Company believes that the amendments will provide for a
two-year extension of the credit and in improved terms and costs of borrowing as
well as an increased borrowing base of $315 million.

During the three-months ended March 31, 2004, net cash provided by operating
activities was $26.9 million as compared to $14.0 million for the three-months
ended March 31, 2003. The increase in cash provided by operating activities was
attributable to the increase in earnings.

During the three-months ended March 31, 2004, cash used in investing activities
was $42.2 million as compared to $9.8 million for the three-months ended March
31, 2003. The change is primarily attributable to increased activity for
drilling and completion activity in Wyoming and China.

During the three-months ended March 31, 2004, cash provided by (used in)
financing activities was $15.4 million as compared to $(3.9) million for the
three-months ended March 31, 2003. The change is primarily attributable to
increased borrowings under the senior credit facility.

CAUTIONARY STATEMENT PURSUANT TO SAFE HARBOR PROVISION OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995

This report contains or incorporates by reference forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended,
Section 21E of the Securities Exchange Act of 1934 and the Private Securities
Litigation Reform Act of 1995. All statements other than statements of
historical facts included in this document, including without limitation,
statements in Management's Discussion and Analysis of Financial Condition and
Results of Operations regarding our financial position, estimated quantities and
net present values of reserves, business strategy, plans and objectives of the
Company's management for future operations, covenant compliance and those
statements preceded by, followed by or that otherwise include the words
"believe", "expects", "anticipates", "intends", "estimates", "projects",
"target", "goal", "plans", "objective", "should", or similar expressions or
variations on such expressions are forward-looking statements. The Company can
give no assurances that the assumptions upon which such forward-looking
statements are based will prove to be correct nor can the Company assure
adequate funding will be available to execute the Company's planned future
capital program.

                                                                               9
<PAGE>

Other risks and uncertainties include, but are not limited to, fluctuations in
the price the Company receives for oil and gas production, reductions in the
quantity of oil and gas sold due to increased industry-wide demand and/or
curtailments in production from specific properties due to mechanical, marketing
or other problems, operating and capital expenditures that are either
significantly higher or lower than anticipated because the actual cost of
identified projects varied from original estimates and/or from the number of
exploration and development opportunities being greater or fewer than currently
anticipated and increased financing costs due to a significant increase in
interest rates. See the Company's annual report on Form 10-K for the year ended
December 31, 2003 for additional risks related to the Company's business.

ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company's major market risk exposure is in the pricing applicable to its gas
and oil production. Realized pricing is primarily driven by the prevailing price
for crude oil and spot prices applicable to the Company's U.S. natural gas
production. Historically, prices received for gas production have been volatile
and unpredictable. Pricing volatility is expected to continue. Gas price
realizations averaged $4.95 per Mcf during the three months ended March 31,
2004. This average price includes the effects of hedging and gas balancing
between working interest owners.

The Company periodically enters into commodity derivative contracts and
fixed-price physical contracts to manage its exposure to oil and natural gas
price volatility. The Company primarily utilizes price swaps, which are
generally placed with major financial institutions or with counter-parties of
high credit quality that it believes are minimal credit risks. The oil and
natural gas reference prices of these commodity derivatives contracts are based
upon crude oil and natural gas futures, which have a high degree of historical
correlation with actual prices the Company receives. Under SFAS No. 133 all
derivative instruments are recorded on the balance sheet at fair value. Changes
in the derivative's fair value are recognized currently in earnings unless
specific hedge accounting criteria are met. For qualifying cash flow hedges, the
gain or loss on the derivative is deferred in accumulated other comprehensive
income (loss) to the extent the hedge is effective. For qualifying fair value
hedges, the gain or loss on the derivative is offset by related results of the
hedged item in the income statement. Gains and losses on hedging instruments
included in accumulated other comprehensive income (loss) are reclassified to
oil and natural gas sales revenue in the period that the related production is
delivered. Derivative contracts that do not qualify for hedge accounting
treatment are recorded as derivative assets and liabilities at market value in
the consolidated balance sheet, and the associated unrealized gains and losses
are recorded as current expense or income in the consolidated statement of
operations. The Company currently does not have any derivative contracts in
place that do not qualify as a cash flow hedge.

During the first three months of 2004, the total impact of the Company's hedges
was a reduction in gas revenues of $1,383,300. The Company does not currently
hedge its oil production.

At March 31, 2004, the Company had the following open derivative contracts to
manage price risk on a portion of its natural gas production whereby the Company
receives the fixed price and pays the variable price (all prices southwest
Wyoming basis). (The Company's gas contains approximately 1.06 MMBtu per Mcf
upon delivery at the sales point.)

<TABLE>
<CAPTION>
                                                        Average
               Contract               Volume-           Price /
Type            Period              MMBTU / day          MMbtu
----            ------              -----------          -----
<S>         <C>                     <C>                 <C>
Swap        Calendar  2004            20,000             $ 4.09
Swap        April-Oct 2004             5,000             $ 4.76
Swap        Calendar  2005             5,000             $ 4.50
Swap        Calendar  2006             5,000             $ 4.20
</TABLE>

The Company also utilizes fixed price forward gas sales at southwest Wyoming
delivery points to hedge its commodity exposure. In addition to the derivative
contracts discussed above, the Company had the following physical delivery
contracts in place on behalf of its interest and those of other parties at March
31, 2004. (The Company's approximate average net interest in physical gas sales
is 80%.)

<TABLE>
<CAPTION>
                          Volume -                  Average
Contract Period         MMBTU / day              Price / MMbtu
---------------         -----------              -------------
<S>                     <C>                      <C>
April-Oct 2004             20,000                   $ 4.68
Calendar  2004             30,000                   $ 4.22
Calendar  2005             35,000                   $ 4.17
Calendar  2006             10,000                   $ 4.00
</TABLE>

The above contracts represent approximately 50% of the Company's currently
forecasted gas production for calendar 2004, 24% for calendar 2005 and 7% for
calendar 2006.

ITEM 4 - CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures. The Company's management,
including the Company's principal executive officer and principal financial
officer, has evaluated the effectiveness of the Company's disclosure controls
and procedures (as defined in Rules 13a-15(e) and 15(d)-15(e) under the
Securities Exchange Act of 1934) as of the end of the period covered by this
Quarterly Report on Form 10-Q. Based upon that evaluation, the Company's
principal executive officer and principal financial officer have concluded that
the disclosure controls and procedures were effective as of the end of the
period covered by this Quarterly Report on Form 10-Q.

(b) Changes in Internal Controls. There were no changes in the Company's
internal control over financial reporting that occurred during the Company's
last fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the Company's internal control over financial reporting.

                                                                              10
<PAGE>

                           PART 2 - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Company is currently involved in various routine disputes and allegations
incidental to its business operations. While it is not possible to determine the
ultimate disposition of these matters, the Company believes that the resolution
of all such pending or threatened litigation is not likely to have a material
adverse effect on the Company's financial position, or results of operations.

ITEM 2. CHANGES IN SECURITIES

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF THE SECURITY HOLDERS

None

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)  Exhibits

     31.1 Certification Pursuant to Section 302 of the Sarbanes-Oxley Act

     31.2 Certification Pursuant to Section 302 of the Sarbanes-Oxley Act

     32.1 Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

     32.2 Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

(b)  Reports on Form 8-K

     The Company filed a current report on Form 8-K dated March 25, 2004
     disclosing the voluntary delisting from the Toronto Stock Exchange ("TSX")
     effective March 31, 2004.

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                                 ULTRA PETROLEUM CORP.

Date April 30, 2004

                                             By: /s/ Michael D. Watford
                                                 Name:  Michael D. Watford
                                                 Title: Chief Executive Officer

                                             By: /s/ F. Fox Benton III
                                                 Name:  F. Fox Benton III
                                                 Title: Chief Executive Officer

                                                                              11
<PAGE>

                               INDEX TO EXHIBITS

31.1 Certification Pursuant to Section 302 of the Sarbanes-Oxley Act

31.2 Certification Pursuant to Section 302 of the Sarbanes-Oxley Act

32.1 Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

32.2 Certification Pursuant to Section 906 of the Sarbanes-Oxley Act