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TransGlobe Energy Corporation

Revised Initial Annual Information Form

Year Ended December 31, 2003





September 8, 2004

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TABLE OF CONTENTS

|                                         |                                               |    |                               |                                   |                                                        | Page
|---------------------------------------- | --------------------------------------------- | -- | ----------------------------- | --------------------------------- | ------------------------------------------------------ | ----
|                                         |                                               |    |                               |                                   |                                                        |     
|ABBREVIATIONS                            | 2                                             |    |                               | Quarterly Financial Information   | 31                                                    
|CONVERSIONS                              | 2                                             |    |                               | Capital Expenditures              | 31                                                    
|FORWARD LOOKING STATEMENTS               | 2                                             |    | MANAGEMENT'S DISCUSSION AND   |                                  
|CURRENCY AND EXCHANGE RATES              | 3                                             |    | ANALYSIS OF OPERATING RESULTS | 32                               
|CERTAIN DEFINITIONS                      | 4                                             |    | DIVIDEND POLICY               | 32                               
|TRANSGLOBE ENERGY CORPORATION            | 6                                             |    | MARKET FOR SECURITIES         | 32                               
|                                         | The Company                                   | 6  |                               | DIRECTORS AND OFFICERS            | 32                                                    
|                                         | Subsidiaries                                  | 6  |                               |                                   | Corporate Cease Trade Orders or
      Bankruptcies     | 34  
|GENERAL DEVELOPMENT OF THE BUSINESS      | 7                                             |    |                               | Penalties or Sanctions            | 34                                                    
|SIGNIFICANT ACQUISITIONS AND             |                                               |    |                               | Personal Bankruptcies             | 34                                                    
|SIGNIFICANT DISPOSITIONS                 | 7                                             |    |                               | Conflicts of Interest             | 34                                                    
|TRENDS                                   | 7                                             |    | HUMAN RESOURCES               | 34                               
|RECENT DEVELOPMENTS                      | 7                                             |    | AUDITORS, TRANSFER AGENT AND  |                                  
|DESCRIPTION OF THE BUSINESS AND          |                                               |    | REGISTRAR                     | 34                               
|PRINCIPAL PROPERTIES                     | 8                                             |    | RISK FACTORS                  | 34                               
|                                         | Block 32 Republic of Yemen                    | 8  |                               |                                   | General Conditions Relating to
      Oil and Gas       |     
|                                         | 2003 Drilling Results                         | 9  |                               |                                   | Exploration and Production Operations                  | 34  
|                                         | Block S-1, Republic of Yemen                  | 9  |                               |                                   | Industry Risks                                         | 35  
|                                         | 2003 Drilling Results                         | 10 |                               |                                   | Exploration and Development                            | 35  
|                                         | Development Plan                              | 10 |                               |                                   | Competition                                            | 35  
|                                         | Canada                                        | 11 |                               |                                   | Title to Properties                                    | 36  
|STATEMENT OF RESERVES DATA AND           |                                               |    |                               | Interests in Properties           | 36                                                    
|OTHER OIL AND GAS INFORMATION            | 11                                            |    |                               | Government Regulation             | 36                                                    
|                                         | Disclosure of Reserves Data                   | 11 |                               |                                   | Political Risks Relating to Yemen                      | 36  
|RESERVES DATA (CONSTANT PRICES
      AND |                                               |    |                               | Reliance Upon Officers            | 36                                                    
|COSTS)                                   | 12                                            |    |                               | Multi-jurisdictional Legal Risks  | 36                                                    
|ESTIMATED FUTURE NET REVENUES            | 13                                            |    |                               | Reserve Information               | 37                                                    
|RESERVES DATA (FORECAST PRICES
      AND |                                               |    |                               | Additional Financing Requirements | 37                                                    
|COSTS)                                   | 16                                            |    |                               | Canadian Tax Considerations       | 37                                                    
|                                         | Reconciliations of Changes in Reserves and    |    |                               |                                   | Exchange Rate Risks                                    | 37  
|                                         | Future Net Revenue                            | 25 |                               |                                   | Dividends                                              | 37  
|                                         | Additional Information Relating to            |    |                               |                                   | Conflicts of Interest                                  | 37  
|                                         | Reserves Data                                 | 27 |                               |                                   | Reliance on Key Personnel                              | 38  
|                                         | Undeveloped Reserves                          | 27 |                               |                                   | Dilutive Effect of Financings
      and Acquisitions . | 38  
|                                         | Probable Undeveloped Reserves                 | 27 |                               | INDUSTRY CONDITIONS               | 38                                                    
|                                         | Other Oil and Gas Information                 | 28 |                               |                                   | Government Regulation Generally                        | 38  
|                                         | Oil And Gas Wells                             | 28 |                               |                                   | Pricing and Marketing - Oil                            | 38  
|                                         | Properties with no Attributable Reserves      | 28 |                               |                                   | Pricing and Marketing - Natural
      Gas              | 38  
|                                         | Forward Contracts                             | 28 |                               |                                   | Pipeline Capacity                                      | 39  
|                                         | Additional Information Concerning Abandonment |    |                               |                                   | The North American Free Trade
      Agreement          | 39  
|                                         | and Reclamation Costs                         | 28 |                               |                                   | Royalties and Incentives                               | 39  
|                                         | Production Estimates                          | 29 |                               |                                   | Environmental Regulation                               | 40  
|                                         | Exploration and Development Activities        | 29 |                               |                                   | Kyoto Protocol                                         | 40  
|                                         | Production History                            | 29 |                               | ADDITIONAL INFORMATION            | 40                                                    
|SELECTED CONSOLIDATED FINANCIAL          |                                               |    |                               |                                   |                                                       
|INFORMATION                              | 31                                            |    |                               |                                   |                                                       

|SCHEDULE "A" | Report on Reserves Data                                                        
|------------ | -------------------------------------------------------------------------------
|SCHEDULE "B" | Report of Management and Directors on Reserves Data
      and Other Information

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2

ABBREVIATIONS

|Oil and Natural Gas Liquids | Natural Gas              |       
|--------------------------- | ------------------------ | ------
|                            |                          |       
|Bbl                         | Barrel                   | Mcf   
|Bbls                        | Barrels                  | MMcf  
|MBbls                       | thousand barrels         | Mcf/d 
|MMbbls                      | million barrels          | MMcf/d
|Mstb                        | 1,000 stock tank barrels | Mmbtu 
|Bbls/d                      | barrels per day          | Bcf   
|Bopd                        | barrels of oil per day   | Tcf   
|NGLs                        | natural gas liquids      | GJ    
|STB                         | standard tank barrels    |       

Other

|AECO   | EnCana Corp.'s natural gas storage facility
        located at Suffield, Alberta.                                                                                                                                                             
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|API    | American Petroleum Institute                                                                                                                                                                                                                  
|°API   | an indication of the specific gravity
        of crude oil measured on the API gravity scale. Liquid petroleum with
        specified gravity of 28° API or higher is generally referred to as
        light crude oil                        
|ARTC   | Alberta Royalty Tax Credit                                                                                                                                                                                                                    
|BOE    | barrel of oil equivalent of natural gas
        and crude oil on the basis of 1 BOE for 6 Mcf of natural gas (this conversion
        factor is an industry accepted norm and is not based on either energy
        content or current prices)
|BOE/d  | barrel of oil equivalent per day                                                                                                                                                                                                              
|m3     | cubic metres                                                                                                                                                                                                                                  
|MBOE   | 1,000 barrels of oil equivalent                                                                                                                                                                                                               
|Mstboe | 1,000 stock tank barrels of oil equivalent                                                                                                                                                                                                    
|M$     | Thousands of dollars                                                                                                                                                                                                                          
|MM$    | millions of dollars                                                                                                                                                                                                                           
|WTI    | West Texas Intermediate, the reference
        price paid in U.S. dollars at Cushing, Oklahoma for crude oil of standard
        grade                                                                                                        

CONVERSIONS

|To Convert From | To           | Multiply By
|--------------- | ------------ | -----------
|                |              |            
|Mcf             | Cubic metres | 28.174     
|Cubic metres    | Cubic feet   | 35.494     
|Bbls            | Cubic metres | 0.159      
|Cubic metres    | Bbls oil     | 6.290      
|Feet            | Metres       | 0.305      
|Metres          | Feet         | 3.281      
|Miles           | Kilometres   | 1.609      
|Kilometres      | Miles        | 0.621      
|Acres           | Hectares     | 0.405      
|Hectares        | Acres        | 2.471      

A Boe conversion ratio of 6 Mcf = 1 Bbl has been used. Boe's
  may be misleading, particularly if used in isolation. A Boe conversion ratio
  of 6 Mcf to 1 Bbl is based on an energy equivalency conversion method primarily
  applicable at the burner tip and does not represent a value equivalency at the
  wellhead.

FORWARD LOOKING STATEMENTS

Certain statements contained in this Annual Information Form
  and in certain documents incorporated by reference into this Annual Information
  Form, constitute forward-looking statements. These statements relate to future
  events or the Company's future performance. All statements other than statements
  of historical fact may be forward-looking statements. Forward-looking statements
  are often, but not always, identified by the use of words such as "seek",
  "anticipate", "plan", "continue", "estimate",
  "expect", "may", "will", "project",
  "predict", "potential",

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"targeting", "intend", "could", "might", "should", "believe"
  and similar expressions. These statements involve known and unknown risks, uncertainties
  and other factors that may cause actual results or events to differ materially
  from those anticipated in such forward-looking statements. Actual operational
  and financial results may differ materially from TransGlobe's expectations contained
  in the forward-looking statements as a result of various factors, many of which
  are beyond the control of the Company. These factors include, but are not limited
  to, unforeseen changes in the rate of production from TransGlobe's oil and gas
  fields, changes in the price of crude oil and natural gas, adverse technical
  factors associated with exploration, development, production or transportation
  of TransGlobe's crude oil and natural gas reserves, changes or disruptions in
  the political or fiscal regimes in TransGlobe's areas of activity, changes in
  Canadian, Yemen or American tax, energy or other laws or regulations, changes
  in significant capital expenditures, delays in production starting up due to
  an industry shortage of skilled manpower, equipment or materials, and the cost
  of inflation.

In particular, this Annual Information Form and the documents
  incorporated by reference contain forward-looking statements pertaining to the
  following:

the quantity of reserves;oil and natural gas production levels;capital expenditure programs;projections of market prices and costs;supply and demand for oil and natural gas;expectations regarding the Company's ability to raise capital and to
      continually add to reserves through acquisitions and development; and
    treatment under government regulatory and taxation regimes.


The Company's actual results could differ materially from
  those anticipated in these forward-looking statements as a result of the risk
  factors set forth below and elsewhere in this Annual Information Form:

volatility in market prices for oil and natural gas;liabilities and risks inherent in oil and natural gas operationsuncertainties associated with estimating reserves;competition for, among other things, capital, acquisitions of reserves,
      undeveloped lands and skilled personnel;
    incorrect assessments of the value of acquisition; andgeological, technical, drilling and processing problems.


The Company believes that the expectations reflected in those
  forward looking statements are reasonable but no assurance can be given that
  these expectations will prove to be correct and such forward-looking statements
  included in, or incorporated by reference into, this Annual Information Form
  should not be unduly relied upon. These statements speak only as of the date
  of this Annual Information Form, as the case may be. The Company does not intent,
  and does not assume any obligation, to update these forward-looking statements.

CURRENCY AND EXCHANGE RATES

All dollar amounts in this Annual Information Form, unless otherwise indicated, are stated in United States currency.  The Company has adopted the US dollar as the functional currency for its consolidated financial statements. The exchange rates for
the period average and end of period for the US dollar in terms of Canadian dollars as reported by the Bank of Canada were as follows for each of the years ended December 31, 2003, 2002 and 2001 and the six months ended June 30, 2004:

|               | Six Months Ended |  | Year Ended        |  | Year Ended        |  | Year Ended       
|-------------- | ---------------- |  | ----------------- |  | ----------------- |  | -----------------
|               | June 30, 2004    |  | December 31, 2003 |  | December 31, 2002 |  | December 31, 2001
|               |                  |  |                   |  |                   |  |                  
|End of Period  | Cdn$1.3404       |  | Cdn$1.2965        |  | Cdn$1.5776        |  | Cdn$1.5928       
|               |                  |  |                   |  |                   |  |                  
|Period Average | Cdn$1.3384       |  | Cdn$1.4009        |  | Cdn$1.5704        |  | Cdn$1.5484       

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CERTAIN DEFINITIONS

In this Annual Information Form, the following words and phrases
  have the following meanings, unless the context otherwise requires:

AMEX


"Brent" means the reference price paid in US dollars,
  for a barrel of light sweet crude oil produced from the Brent field in the UK
  sector of the North Sea;

Cdn


"COGE Handbook" means the Canadian Oil and Gas Evaluation
  Handbook prepared jointly by the Society of Petroleum Evaluation Engineers (Calgary
  chapter) and the Canadian Institute of Mining, Metallurgy & Petroleum;

CPF


"Dry Hole"or"Dry Well"or"Non-Productive Well" means a well found to be incapable of producing
  either oil or natural gas in sufficient quantities to justify completion as
  an oil or natural gas well;

"Exploratory Well" means a well drilled either in search
  of a new, as-yet undiscovered oil or natural gas reservoir or to greatly extend
  the known limits of a previously discovered reservoir;

"Fekete" means Fekete Associates Inc., independent
  petroleum engineers;

"Fekete Report" means the report of Fekete dated January
  20, 2004 evaluating the Yemen crude oil, natural gas and natural gas reserves
  of the Company as at December 31, 2003;

"GAAP" means Generally Accepted Accounting Principles;

"Gross" or "gross" means:

|(a) | in relation to the Company's interest in production
        and reserves, its "Company gross reserves", which are the Company's interest
        (operating and non-operating) share before deduction of royalties and
        without including any royalty interest of the Company;
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(b) | in relation to wells, the total number of wells
        in which the Company has an interest; and                                                                                                                                                                                    
|   
|(c) | in relation to properties, the total area of properties
        in which the Company has an interest;                                                                                                                                                                                

"MOM" means Ministry of Oil and Minerals, Republic
  of Yemen, formerly MOMR, the Ministry of Oil and Mineral Resources;

"Net" or "net" means:

|(a) | in relation to the Company's interest in production
        and reserves, the Company's interest (operating and non- operating) share
        after deduction of royalties obligations, plus the Company's royalty interest
        in production or reserves.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(b) | in relation to wells, the number of wells obtained
        by aggregating the Company's working interest in each of its gross wells;
        and                                                                                                              
|   
|(c) | in relation to the Company's interest in a property,
        the total area in which the Company has an interest multiplied by the
        working interest owned by the Company;                                                                             

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"NI 51-101" means National Instrument 51-101 Standards
  of Disclosure for Oil and Gas Activities;

"OSA" means Outtrim Szabo Associates Ltd., independent
  petroleum consultants, which firm was subsequently acquired by De Golyer MacNaughton
  Canada Limited;

"OSA Report" means the report of OSA dated January
  29, 2004 evaluating the Canadian crude oil, natural gas liquids and natural
  gas reserves of the Company as at December 31, 2003;

"OTC BB" means the Over the Counter Bulletin Board
  operated by the National Association of Securities Dealers Inc.;

"PSA" means Production Sharing Agreement;

"TransGlobe" or the "Company" means TransGlobe
  Energy Corporation, a corporation organized and registered under the laws of
  British Columbia, Canada and its subsidiary companies;

"TSX" means the Toronto Stock Exchange; "U.S." means United States;


"Vintage" means Vintage Petroleum, Inc. and its subsidiaries;
  and

"YOC" means Yemen Oil Company.

Certain other terms used herein but not defined herein are
  defined in NI 51-101 and, unless the context otherwise requires, shall have
  the same meanings herein as in NI 51-101.

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TRANSGLOBE ENERGY CORPORATION

The Company

TransGlobe Energy Corporation ("TransGlobe" or the "Company")
  was incorporated on August 6, 1968 and was organized under variations of the
  name "Dusty Mac" as a mineral exploration and extraction venture under The
  Company Act (British Columbia). In 1992, the Company entered into the oil
  and gas exploration and development field in the United States and later in
  the Republic of Yemen and Canada and ceased operations as a mining company.
  The United States oil and gas properties were sold in the year 2000 to fund
  opportunities in Yemen. The Company changed its name to TransGlobe Energy Corporation
  on April 2, 1996. The Company is presently seeking approval from its shareholders
  to continue the Company from the Province of British Columbia to the Province
  of Alberta at the annual and special meeting of shareholders of the Company
  to be held on May 26, 2004.

TransGlobe, through its wholly owned subsidiaries, is primarily
  engaged in exploration for, development and production of, oil and gas in Canada
  and the Republic of Yemen.

The Company's principal office is located at 2900, 330 
  5th Avenue S.W., Calgary, Alberta, T2P 0L4, and the Company's registered office
  is located at Suite 2800, Floor, 666 Burrard Street, Vancouver, British Columbia,
  V6C 2Z7.

Subsidiaries

The following table sets out the subsidiaries of the Company
  and the Company's ownership interest in those subsidiaries:

|Name of Subsidiary                      |  | Country of Incorporation        |  | Ownership
|--------------------------------------- |  | ------------------------------- |  | ---------
|TransGlobe Oil & Gas Corporation        |  | Washington State, United States |  | 100%     
|TransGlobe Petroleum International Inc. |  | Turks & Caicos Islands, B.W.I.  |  | 100%     
|TG Holdings Yemen Inc.(1)               |  | Turks & Caicos Islands, B.W.I.  |  | 100%     

Note:

|(1) | TransGlobe is the indirect holder of TG Holdings Yemen Inc., which is
      100% owned directly by TransGlobe Petroleum International Inc.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------

TG Holdings Yemen Inc. owns TransGlobe's interests in Block
  32 and Block S-1 in Yemen.

Unless the context otherwise requires, reference in this
  Annual Information Form to the"Company"includes the Company
  and its direct and indirect wholly-owned subsidiaries.

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GENERAL DEVELOPMENT OF THE BUSINESS

TransGlobe is an independent, Canadian based, international
  upstream oil and gas company whose main business activities include exploration,
  development and production of crude oil, natural gas liquids and natural gas.
  The Company has exploration and production operations in Canada and in the Republic
  of Yemen.

During the past three years, TransGlobe has developed its
  business interests through a combination of exploration and development, and
  to a lesser extent, acquisitions and dispositions primarily focused on two production
  sharing agreements in Yemen (a 13.81087% working interest in Block 32 and a
  25% working interest in Block S-1) and Central Alberta in Western Canada.

The year 2001 was the first full year of production from the
  Tasour field on Block 32 in Yemen (production commenced November 4, 2000). The
  primary focus of 2001 consisted of development/exploration drilling and a 2-D
  seismic acquisition program on Block 32 and a 3-D seismic acquisition program
  on Block S-1. A small four-well drilling program was conducted in Canada.

In the year 2002, the primary focus was again on the Republic
  of Yemen. On Block 32, the Company participated in three wells and additional
  2-D seismic acquisition. On March 28, 2002, the Company elected to enter into
  the second exploration phase (21⁄2 years) on Block S-1. The Company participated
  in drilling three wells (one drilling over year end) on Block S-1, leading to
  the An Nagyah light oil discovery. A small three well drilling program was conducted
  in Canada.

In the year 2003, the primary focus was on Block S-1 in Yemen
  and an expanded exploration drilling program in Canada. On Block S-1, the An
  Nagyah light oil discovery was appraised with two wells which led to the Declaration
  of Commerciality and the filing of a Development Plan on October 14, 2003. On
  October 15, 2003, MOM approved the Development Plan and a 20 year Development
  Area of approximately 285,000 acres for Block S-1. On Block 32, the Company
  participated in five wells resulting in four oil wells for an 80% success ratio.
  In Canada, the Company drilled nine wells resulting in six gas wells, two oil
  wells and one cased potential gas well for an 88% success ratio.

In November, 2003, the Company listed on the American Stock
  Exchange ("AMEX") under the symbol TGA, which replaced the Company's previous
  listing on the NASDAQ bulletin board under the symbol TGLEF. The Company continues
  to be listed on the TSX under the symbol TGL.

SIGNIFICANT ACQUISITIONS AND SIGNIFICANT DISPOSITIONS

There were no significant acquisitions or significant dispositions
  by the Company or any significant probable acquisition by the Company within
  or since the completion of the most recently completed financial year of the
  Company.

TRENDS

There are a number of trends that have been developing in
  the oil and gas industry during the past few years that appear to be shaping
  the future of the business.

The most significant trend impacting the Company is the continued
  volatility of both natural gas and crude oil prices. Natural gas is a commodity
  influenced by factors exclusively in North America. During 2003 we saw record
  drilling but natural gas production volumes did not grow. In 2004 to present
  date, natural gas prices have remained strong. Crude oil is influenced by a
  world economy and OPEC's ability to adjust supply to world demand. During 2003,
  crude oil prices remained strong. Historically natural gas and crude oil prices
  have been very volatile; however, management believes commodity prices will
  be strong for the balance of 2004.

RECENT DEVELOPMENTS

The Company has recently approved a $20 million capital program for 2004.

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8

DESCRIPTION OF THE BUSINESS AND PRINCIPAL PROPERTIES

The Company is engaged in the exploration for, the development
  and production of crude oil and natural gas primarily in the Republic of Yemen
  and also in Central Alberta, Canada. The Company also reviews potential acquisitions
  and new international exploration blocks to supplement its exploration and development
  activities.

TransGlobe's major operations and principal activities are
  in the oil and gas exploration and production business. The Company has operated
  in the Republic of Yemen and Canada during the past three years. In the Republic
  of Yemen the Company has interests in two production sharing agreements; Block
  32 and Block S-1. In Canada all the Company's interests are located in the province
  of Alberta, primarily in central Alberta.



TransGlobe entered into its first international project in
  January 1997 through a farmout agreement and joint venture on Block 32. The
  Company has since participated in acquisition of seismic data, drilling of seventeen
  wells and construction of production facilities, resulting in commencement of
  Tasour field production on November 3, 2000. Production from Block 32 is pipeline
  connected to the Nexen operated export pipe line system and loading terminal
  on the Indian Ocean. TransGlobe's production is sold to Nexen Marketing International
  and receives price referenced to dated Brent less a quality differential. The
  joint venture currently consists of TG Holdings Yemen Inc. (a wholly-owned subsidiary
  of TransGlobe Energy Corporation) with a 13.81087% working interest and partners
  Ansan Wikfs Hadramaut Ltd. and DNO ASA holding the balance ("the Block 32 Joint
  Venture Group"). DNO ASA (an independent Norwegian oil company) is the operator
  of the Block. The Yemen Oil Company ("YOC" - a Yemen government oil company)
  has a 5% interest in the Block 32 Joint Venture Group's production sharing oil.

The Block 32 development area covers 591 square kilometers
  (146,070 acres). The development area encompasses all of the Tasour structure
  and several additional prospects. The approved development/production period
  extends until the year 2020, with an optional five-year extension to 2025.

During 2003, the Block 32 Joint Venture work program consisted
  of the drilling of three development/appraisal wells and two exploration wells.
  The five wells resulted in an exploratory dry hole at Haibish and four producing
  oil wells (Tasour #8, #9, #10 and #11, summarized in the table below).

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9

2003 Drilling Results

|Well       |  | Date Completed |  | Initial Production Rate |  | Producing Formation
|---------- |  | -------------- |  | ----------------------- |  | -------------------
|Tasour #8  |  | January 2003   |  | 9,000 Bopd              |  | Qishn              
|Haibish #1 |  | February 2003  |  | -                       |  | D&A                
|Tasour #9  |  | April 2003     |  | 1,500 Bopd              |  | Qishn              
|Tasour #10 |  | July 2003      |  | 1,200 Bopd              |  | Qishn              
|Tasour #11 |  | November 2003  |  | 6,000 Bopd              |  | Qishn              

The Tasour #8 and Tasour #9 development wells confirmed the
  southern field extension discovered by Tasour #7 in 2002. The Tasour #10 well
  was a successful test of the western field extension. This discovery extended
  the mapped Tasour field length from 3.3 kilometers to approximately 6.8 kilometers.
  Tasour #11 confirmed the western field extension creating a series of new development
  locations.

The western field extension combined with continued field
  performance increased proven plus probable reserves 32% and replaced 169% of
  2003 production. Seismic mapping indicates the Tasour field could extend both
  to the west and to the east of the current wells. In late 2003, the Block 32
  Joint Venture Group approved a 100 square kilometer 3-D seismic acquisition
  survey over the greater Tasour area to refine future drilling locations. It
  is anticipated that the 3-D seismic will be completed and interpreted by June
  2004. Further development/appraisal drilling of three to four wells in the western
  and potential eastern extension is planned for 2004. One infill well is planned
  for the central Tasour pool in May 2004 (Tasour #12).

Block S-1, Republic of Yemen


TransGlobe entered into its second international exploration
  venture in 1997 by signing a Production Sharing Agreement ("PSA") for the Damis
  S-1 Block ("Block S-1") with the Ministry of Oil and Minerals ("MOM"). TG Holdings
  Yemen Inc. (a wholly owned subsidiary of TransGlobe Energy Corporation) entered
  into a joint venture arrangement for Block S-1 with a subsidiary of Vintage
  Petroleum Inc., a U.S. independent exploration and production company ("Block
  S-1 Joint Venture Group"). During 2000 Vintage earned a 75% working interest
  in Block S-1 by funding 100% of the work commitments for the first exploration
  period of the Block S-1 PSA and by spending a minimum of $20 million. TransGlobe
  has retained a 25% working interest in Block S-1. Vintage is the operator of
  Block S-1. The YOC has a 17.5% interest in the Block S-1 Joint Venture Group's
  share of production sharing oil.

The first exploration period ended on March 28, 2002 and the
  Block S-1 Joint Venture Group elected to proceed with a second exploration period
  of 2 1⁄2 years. The second exploration period commitments were satisfied
  by the drilling of An Naeem #2 (2000), Osaylan #1 (2002), An Nagyah #2 (2002)
  and a 3-D seismic survey (2001).

Block S-1 originally encompassed an area of 4,484 square kilometers
  (approximately 1.1 million acres). Upon declaring commerciality in October 2003,
  a final relinquishment reduced the Block to a Development Area of 1,152 square
  kilometers (284,700 acres). The Development Area is now valid until October
  2023 (20 years) with an additional five year extension available.

The 2003 drilling program commenced in September 2002 was
  completed in May 2003, resulting in three oil wells, one gas/condensate well
  and one dry hole. The wells drilled during 2003 were An Naeem #3 (gas/condensate),
  An Nagyah #3 (oil) and An Nagyah #4 (oil).

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10

2003 Drilling Results

|             | Date Completed |  | Results         |  | Formation
|------------ | -------------- |  | --------------- |  | ---------
|An Naeem #3  | January 2003   |  | Gas/condensate  |  | Alif     
|An Nagyah #3 | March 2003     |  | Gas, not tested |  | Lam A'  
|             |                |  | Oil: 240 Bopd   |  | Lam B'  
|An Nagyah #4 | April 2003     |  | Oil: 1,320 Bopd |  | Lam A'  

The first well, An Naeem #3, was drilled to a total depth
  of 1,623 meters to evaluate a potential oil rim on the An Naeem structure. The
  An Naeem #3 well tested gas and condensate from the Alif zone and did not encounter
  the anticipated oil rim.

The next well, An Nagyah #3, commenced drilling in February
  2003 to appraise the light oil discovery made at An Nagyah #2 (1,100 Bopd announced
  December 10, 2002). The well was drilled to a total depth of 1,292 meters and
  encountered the Upper Lam sandstones in a structurally higher position than
  the An Nagyah #2 well. Although the Upper Lam sandstones had a thicker gross
  reservoir section and better indicated porosity and permeability than found
  at An Nagyah #2, the Upper Lam was not flow tested as it was gas bearing. The
  well did test 240 Bopd of light, 42 degree API oil from a new pool in the Lower
  Lam. The core and test data indicate the Lower Lam reservoir has less porosity
  and permeability than the Upper Lam reservoir and therefore may require stimulation
  to enhance production. The discovery of a new productive horizon in the Lower
  Lam should augment development economics.

The next well in the program, An Nagyah #4, was drilled to
  a total depth of 1,547 meters and tested 1,320 barrels of light oil (45 degrees
  API) from the Upper Lam reservoir. The An Nagyah #4 well encountered a much
  thicker gross sand package and defined a 60 meter (197 feet) total oil column
  in the Nagyah pool. A longer term test of the An Nagyah #4 well was carried
  out during June/July confirming the original flow rates and pressures. The successful
  appraisal well at An Nagyah #4 convinced the Block S-1 partners to declare commerciality
  and proceed with development of the field.

Development Plan


On October 14, 2003 the Company announced the Declaration
  of Commerciality and on October 15, 2003 the Ministry of Oil and Minerals approved
  the Block S-1 Development Plan and Development Area of approximately 1,150 square
  kilometers (285,000 acres). The large Development Area encompasses the An Naeem,
  Harmel and An Nagyah discoveries as well as numerous additional prospects for
  future exploration drilling. The Development/Production period will extend until
  2023 with an optional five year extension also possible.

The initial field development is focused on the An Nagyah
  light oil pool which was discovered and appraised during the 2002/2003 drilling
  program. The plan provides for early production commencing in the first quarter
  of 2004 by trucking up to 2,500 Bopd (625 Bopd to TransGlobe) from An Nagyah
  wells to the Hunt operated Halewah facility.

The construction of a central production facility ("CPF")
  at An Nagyah and a 28 kilometer (18 mile) pipeline to the Jannah Hunt Halewah
  export pipeline is planned during 2004, with an anticipated completion by early
  2005. The pipeline design was increased from an 8 inch to a 10 inch pipeline
  to allow future discoveries to be placed on stream quickly (ultimate capacity
  of 80,000 Bopd). The CPF is designed for an initial capacity of 10,000 Bopd
  (2,500 Bopd to TransGlobe), with expansion capabilities. The initial front end
  engineering and design ("FEED") study is complete. Bid requests for detailed
  engineering and for long lead time major equipment have been issued.

It is expected that the An Nagyah field development will consist
  of 13 wells to delineate and produce the field. The first development/appraisal
  well (An Nagyah #5) commenced drilling on the western area of the An Nagyah
  field on March 8, 2004. An Nagyah #5 was drilled to a total depth of 1,300 meters
  and completed as an Upper Lam 'A' oil producer. The well flow tested at a rate
  of 1,150 Bopd of 45 degree API oil. The second development/appraisal well (An
  Nagyah #6), positioned between An Nagyah #2 and An Nagyah #4, commenced drilling
  on April 7, 2004. An Nagyah #6 was drilled to a total depth of 1,207 metrs and
  completed as an Upper Lam 'A' oil producer. The well

---

11

flow tested at a rate of 1, 140 Bopd of 42 degree API oil.
  The well is being equipped for early production via trucking which is expected
  to commence in early May. The third development/appraisal well (AN Nagyah #7),
  located west of An Nagyah #5, commenced drilling May 2, 2004. Following An Nagyah
  #7, it is expected the drilling rig will be moved to Harmel #2 to appraise the
  shallow depth, medium gravity oil discovered in Harmel #1. Additional development
  wells in the An Nagyah pool are expected to be drilled in the third and fourth
  quarters of 2004 and into 2005.

The early production (trucking) facilities at the An Nagyah
  field were installed during the first quarter of 2004 and field production operations
  commenced on An Nagyah #4 on March 28, 2004. With the addition of An Nagyah
  #5 in April, production has been increased to approximately 2,000 Bopd. With
  the addition of An Nagyah #6 in May, it is anticipated that production will
  increase to 2,500 Bopd (approximately 625 Bopd to TransGlobe) as the trucking
  operation is expanded. The oil production is currently being trucked 18 miles
  to the Jannah Hunt facility where it is blended with the Marib light crude and
  transported by pipeline to the Ras Isa loading terminal on the Red Sea.



TransGlobe acquired its Canadian operations in April 1999.
  The majority of the Canadian operations are operated by TransGlobe and are focused
  almost entirely in the southern/central part of the province of Alberta. The
  Nevis area is the major producing area for the Company in Canada. The primary
  focus at Nevis is the drilling and development of Wabamum gas production and
  several shallower secondary targets. The Wabamum is characterized as being a
  tighter, long life gas reserves which may require additional wells per section
  to fully develop the resource. The Nevis wells are connected to existing pipeline
  systems and all the gas is processed through third party gas plants. In addition
  to the Nevis area, the Company has expanded the Canadian operations into several
  new emerging areas at Twining, Morningside and Lone Pine, where additional drilling
  is planned for 2004.

STATEMENT OF RESERVES DATA AND OTHER OIL AND GAS INFORMATION

The statement of reserves data and other oil and gas information
  set forth below (the "Statement") is dated May 14, 2004. The effective date
  of the Statement is December 31, 2003 and the preparation date of the Statement
  is May 14, 2004.

Disclosure of Reserves Data


All of the Corporations reserves herein reported were evaluated
  by independent evaluators in accordance with National Instrument 51 -101 (NI
  51-101) for the year ended December 31, 2003 and National Policy 2-B (NP 2-B)

---

12

for year ended December 31, 2002. The Corporation retained
  Outtrim Szabo Associates Ltd. ("OSA") of Calgary, Alberta, independent petroleum
  engineering consultants, to evaluate the Company's Canadian reserves at December
  31, 2003 and 2002. The Corporation retained Fekete Associates Inc. ("Fekete")
  of Calgary, Alberta, independent petroleum engineering consultants, to evaluate
  the Company's reserves in the Republic of Yemen at December 31, 2003 and 2002.
  On selected tables, reserves for the year ended December 31, 2002 have been
  presented for comparative purposes to assist the reader.

The reserves data set forth below (the "Reserves Data") is
  a consolidation of evaluations prepared by OSA and Fekete with an effective
  date of December 31, 2003 and December 31, 2002 contained in the respective
  Reports. The Reserves Data summarizes the oil, liquids and natural gas reserves
  of the Corporation and the net present values of future net revenue for these
  reserves using constant prices and costs and forecast prices and costs. The
  Corporation reports in US currency and therefore the OSA reports have been converted
  to US $'s at the prevailing conversion rate at December 31 of the respective
  years.

Additional information not required by NI 51-101 has been
  presented to provide continuity and additional information which we believe
  is important to the readers of this information.

Disclosure provided herein in respect of BOEs may be misleading,
  particularly if used in isolation. A BOE conversion ratio of 6 Mcf:1 bbl is
  based on an energy equivalency conversion method primarily applicable at the
  burner tip and does not represent a value equivalency at the wellhead.

All evaluations and reviews of future net cash flow are
  stated prior to any provision for interest costs or general and administrative
  costs and after the deduction of estimated future capital expenditures for wells
  to which reserves have been assigned. It should not be assumed that the estimated
  future net cash flow shown below is representative of the fair market value
  of the Corporation's properties. There is no assurance that such price and cost
  assumptions will be attained and variances could be material. The recovery and
  reserve estimates of crude oil, NGLs and natural gas reserves provided herein
  are estimates only and there is no guarantee that the estimated reserves will
  be recovered. Actual crude oil, NGLs and natural gas reserves may be greater
  than or less than the estimates provided herein.

RESERVES DATA(CONSTANT PRICES AND COSTS)

SUMMARY OF OIL AND GAS RESERVES 
  TOTAL COMPANYAS AT DECEMBER 31, 2003
  (CONSTANT PRICES AND COSTS)

|                     |  | Light & Medium |  |             |  |                     |  |             |  |          |  |         |  |         
|-------------------- |  | -------------- |  | ----------- |  | ------------------- |  | ----------- |  | -------- |  | ------- |  | --------
|                     |  | Crude Oil      |  | Natural Gas |  | Natural Gas Liquids |  | Total Boe's
|                     |  | Gross(1)       |  | Net(2)      |  | Gross(1)            |  | Net(2)      |  | Gross(1) |  | Net(2)  |  | Gross(1)
|By Category          |  | (MBbls)        |  | (MBbls)     |  | (MMcf)              |  | (MMcf)      |  | (MBbls)  |  | (MBbls) |  | (MBoe)  
|Proven               |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Producing            |  | 2,083          |  | 1,276       |  | 3,158               |  | 2,527       |  | 93       |  | 69      |  | 2,702   
|Non-Producing        |  | 263            |  | 191         |  | 2,475               |  | 2,027       |  | 73       |  | 49      |  | 748     
|Undeveloped          |  | -              |  | -           |  | 1,422               |  | 1,119       |  | 58       |  | 39      |  | 296     
|Total Proven         |  | 2,346          |  | 1,467       |  | 7,055               |  | 5,673       |  | 224      |  | 157     |  | 3,746   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Probable             |  | 2,356          |  | 1,533       |  | 4,917               |  | 3,993       |  | 117      |  | 85      |  | 3,292   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Proven Plus Probable |  | 4,702          |  | 2,999       |  | 11,972              |  | 9,666       |  | 341      |  | 242     |  | 7,038   

---

13

SUMMARY OF OIL AND GAS RESERVES 
  YEMENAS AT DECEMBER 31, 2003 
  (CONSTANT PRICES AND COSTS)

|                     |  | Light & Medium |  |             |  |                     |  |             |  |          |  |         |  |         
|-------------------- |  | -------------- |  | ----------- |  | ------------------- |  | ----------- |  | -------- |  | ------- |  | --------
|                     |  | Crude Oil      |  | Natural Gas |  | Natural Gas Liquids |  | Total Boe's
|                     |  | Gross(1)       |  | Net(2)      |  | Gross(1)            |  | Net(2)      |  | Gross(1) |  | Net(2)  |  | Gross(1)
|By Category          |  | (MBbls)        |  | (MBbls)     |  | (MMcf)              |  | (MMcf)      |  | (MBbls)  |  | (MBbls) |  | (MBoe)  
|Proven               |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Producing            |  | 2,035          |  | 1,233       |  | -                   |  | -           |  | -        |  | -       |  | 2,035   
|Non-Producing        |  | 228            |  | 160         |  | -                   |  | -           |  | -        |  | -       |  | 228     
|Undeveloped          |  | -              |  | -           |  | -                   |  | -           |  | -        |  | -       |  | -       
|Total Proven         |  | 2,263          |  | 1,393       |  | -                   |  | -           |  | -        |  | -       |  | 2,263   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Probable             |  | 2,342          |  | 1,521       |  | -                   |  | -           |  | -        |  | -       |  | 2,342   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Proven Plus Probable |  | 4,605          |  | 2,914       |  | -                   |  | -           |  | -        |  | -       |  | 4,605   

SUMMARY OF OIL AND GAS RESERVES 
  CANADAAS AT DECEMBER 31, 2003
  (CONSTANT PRICES AND COSTS)

|                     |  | Light & Medium |  |             |  |                     |  |             |  |          |  |         |  |         
|-------------------- |  | -------------- |  | ----------- |  | ------------------- |  | ----------- |  | -------- |  | ------- |  | --------
|                     |  | Crude Oil      |  | Natural Gas |  | Natural Gas Liquids |  | Total Boe's
|                     |  | Gross(1)       |  | Net(2)      |  | Gross(1)            |  | Net(2)      |  | Gross(1) |  | Net(2)  |  | Gross(1)
|By Category          |  | (MBbls)        |  | (MBbls)     |  | (MMcf)              |  | (MMcf)      |  | (MBbls)  |  | (MBbls) |  | (MBoe)  
|Proven               |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Producing            |  | 48             |  | 42          |  | 3,158               |  | 2,527       |  | 93       |  | 69      |  | 667     
|Non-Producing        |  | 35             |  | 31          |  | 2,475               |  | 2,027       |  | 73       |  | 49      |  | 520     
|Undeveloped          |  | -              |  | -           |  | 1,422               |  | 1,119       |  | 58       |  | 39      |  | 295     
|Total Proven         |  | 83             |  | 74          |  | 7,055               |  | 5,673       |  | 224      |  | 157     |  | 1,483   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Probable             |  | 13             |  | 12          |  | 4,917               |  | 3,993       |  | 117      |  | 85      |  | 950     
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Proven Plus Probable |  | 96             |  | 85          |  | 11,972              |  | 9,666       |  | 341      |  | 242     |  | 2,433   

Notes:

|(1) | Gross reserves are the Company's working interest share before the deduction
      of royalties.                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Net reserves are the Company's working interest
        share after the deduction of royalties. Net reserves in Yemen include
        our share of future cost recovery and production sharing oil after the
        Government's royalty interest but before reserves relating to income taxes
        payable. Under this method, a portion of the reported reserves will increase
        as oil prices decrease (and vice versa) as the barrels necessary to achieve
        cost recovery change with prevailing oil prices.

ESTIMATED FUTURE NET REVENUES

The estimated future net revenues presented do not represent
  fair market value. The estimated future net revenues presented below are calculated
  using the average price received during the final month of the respective reporting
  periods. The prices were held constant and costs were not inflated for the life
  of the reserves, as summarized in the Notes to Reserves Data Tables (Note 4).

---

14

NET PRESENT VALUES OF FUTURE NET REVENUES 
  TOTAL COMPANYAS AT DECEMBER 31, 2003
  (CONSTANT PRICES AND COSTS)

|                           | Before Income Tax(1) |      | After Income Tax (1)
|-------------------------- | -------------------- | ---- | --------------------
|US $'s                     | Discounted at %/yr   |      | Discounted at %/yr  
|$MM                        | 0%                   | 10%  | 15%                 
|                           |                      |      |                     
|Proved                     |                      |      |                     
|                           |                      |      |                     
|Developed producing        | 28.5                 | 23.0 | 21.1                
|Developed non-producing    | 13.8                 | 10.8 | 9.7                 
|Undeveloped                | 5.6                  | 3.3  | 2.7                 
|Total Proved               | 47.9                 | 37.1 | 33.5                
|                           |                      |      |                     
|Probable                   | 37.4                 | 23.2 | 19.2                
|                           |                      |      |                     
|Total Proved Plus Probable | 85.3                 | 60.2 | 52.8                

NET PRESENT VALUES OF FUTURE NET REVENUES
  YEMENAS AT DECEMBER 31, 2003
  (CONSTANT PRICES AND COSTS)

|                           | Before Income Tax(1) |      | After Income Tax (1)
|-------------------------- | -------------------- | ---- | --------------------
|US $'s                     | Discounted at %/yr   |      | Discounted at %/yr  
|$MM                        | 0%                   | 10%  | 15%                 
|                           |                      |      |                     
|Proved                     |                      |      |                     
|                           |                      |      |                     
|Developed producing        | 15.6                 | 13.5 | 12.6                
|Developed non-producing    | 2.4                  | 2.2  | 2.1                 
|Undeveloped                | 0.0                  | 0.0  | 0.0                 
|Total Proved               | 18.0                 | 15.7 | 14.8                
|                           |                      |      |                     
|Probable                   | 18.4                 | 13.3 | 11.4                
|                           |                      |      |                     
|Total Proved Plus Probable | 36.4                 | 29.0 | 26.1                

---

15

NET PRESENT VALUES OF FUTURE NET REVENUESCANADAAS AT DECEMBER 31, 2003(CONSTANT PRICES AND COSTS)

|                           | Before Income Tax(1) |      | After Income Tax (1)
|-------------------------- | -------------------- | ---- | --------------------
|US $'s                     | Discounted at %/yr   |      | Discounted at %/yr  
|$MM                        | 0%                   | 10%  | 15%                 
|                           |                      |      |                     
|Proved                     |                      |      |                     
|                           |                      |      |                     
|Developed producing        | 12.9                 | 9.5  | 8.5                 
|Developed non-producing    | 11.5                 | 8.6  | 7.6                 
|Undeveloped                | 5.6                  | 3.3  | 2.7                 
|Total Proved               | 29.9                 | 21.4 | 18.8                
|                           |                      |      |                     
|Probable                   | 19.0                 | 9.9  | 7.9                 
|                           |                      |      |                     
|Total Proved Plus Probable | 48.9                 | 31.3 | 26.7                

Notes:

|(1) | In Yemen, under the terms of the Production Sharing
        Agreements, income tax is current and assessed on all production sharing
        oil, therefore all Yemen Future Net Revenues are after Yemen income tax.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Canadian values converted to US dollars at the December
        31, 2003 exchange rates of 1.2965 US $'s/Cdn $'s and include the Alberta
        Royalty Tax Credit (ARTC) in the Before and After Income Tax values.

TOTAL FUTURE NET REVENUES(UNDISCOUNTED)AS AT DECEMBER 31, 2003  
   (CONSTANT PRICES AND COSTS)

|                              |  |         |  |           |  |           |  |             |  |             |  | Future Net |  |        |  | Future Net
|----------------------------- |  | ------- |  | --------- |  | --------- |  | ----------- |  | ----------- |  | ---------- |  | ------ |  | ----------
|                              |  |         |  |           |  |           |  |             |  |             |  | Revenue    |  |        |  | Revenue   
|                              |  |         |  |           |  |           |  |             |  | Well        |  | Before     |  |        |  | After     
|                              |  |         |  |           |  | Operating |  | Development |  | Abandonment |  | Income     |  | Income |  | Income    
|                              |  | Revenue |  | Royalties |  | Costs     |  | Costs       |  | Costs       |  | Taxes      |  | Taxes  |  | Taxes     
|Reserves Category             |  | ($ MM)  |  | ($ MM)    |  | ($ MM)    |  | ($ MM)      |  | ($ MM)      |  | ($ MM)     |  | ($ MM) |  | ($ MM)    
|                              |  |         |  |           |  |           |  |             |  |             |  |            |  |        |  |           
|Proved Reserves               |  |         |  |           |  |           |  |             |  |             |  |            |  |        |  |           
|Yemen(1)                      |  | 68.0    |  | 26.0      |  | 12.7      |  | 2.8         |  | -           |  | 26.5       |  | 8.5    |  | 18.0      
|Canada(2)                     |  | 46.1    |  | 7.6       |  | 6.9       |  | 1.4         |  | 0.4         |  | 29.9       |  | 4.0    |  | 25.9      
|Total Company                 |  | 114.1   |  | 33.6      |  | 19.6      |  | 4.2         |  | 0.4         |  | 56.4       |  | 12.5   |  | 43.9      
|                              |  |         |  |           |  |           |  |             |  |             |  |            |  |        |  |           
|Proved Plus Probable Reserves |  |         |  |           |  |           |  |             |  |             |  |            |  |        |  |           
|Yemen(1)                      |  | 138.3   |  | 46.5      |  | 24.7      |  | 11.5        |  | -           |  | 55.7       |  | 19.3   |  | 36.4      
|Canada(2)                     |  | 76.0    |  | 12.5      |  | 11.9      |  | 2.2         |  | 0.4         |  | 48.9       |  | 9.9    |  | 39.0      
|Total Company                 |  | 214.3   |  | 59.0      |  | 36.6      |  | 13.7        |  | 0.4         |  | 104.6      |  | 29.2   |  | 75.4      

Notes:

|(1) | In Yemen, under the terms of the Production Sharing
        Agreements, income tax is current and assessed on all production sharing
        oil, therefore all Yemen Future Net Revenues are after Yemen income tax.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Canadian values converted to US dollars at the December
        31, 2003 exchange rates of 1.2965 US $'s/Cdn $'s and include the Alberta
        Royalty Tax Credit (ARTC) in the Before and After Income Tax values.

---

16

FUTURE NET REVENUE 
  BY PRODUCTION GROUP 
  AS AT DECEMBER 31, 2003 
  (CONSTANT PRICES AND COSTS)

|                |  |                                        |  | Yemen           |  | Canada          |  | Total Company 
|--------------- |  | -------------------------------------- |  | --------------- |  | --------------- |  | --------------
|                |  |                                        |  | Future net      |  | Future net      |  | Future net    
|                |  |                                        |  | Revenue Before  |  | Revenue Before  |  | Revenue Before
|                |  |                                        |  | Income Taxes(1) |  | Income Taxes(2) |  | Income Taxes  
|                |  |                                        |  | (discounted at  |  | (discounted at  |  | (discounted at
|Reserves        |  |                                        |  | 10%/year)       |  | 10%/year)       |  | 10%/year)     
|Category        |  | Product Group                          |  | (US$MM)         |  | (US$MM)         |  | (US$MM)       
|                |  |                                        |  |                 |  |                 |  |               
|Proved Reserves |  | Light and Medium Crude Oil (including  |  | 15.7            |  | 1.7             |  | 17.4          
|                |  | solution gas and other by-products)    |  |                 |  |                 |  |               
|                |  | Natural Gas (including by-products but |  | -               |  | 19.7            |  | 19.7          
|                |  | excluding solution gas)                |  |                 |  |                 |  |               
|                |  |                                        |  |                 |  |                 |  |               
|Proved Plus     |  | Light and Medium Crude Oil (including  |  | 29.0            |  | 2.0             |  | 31.0          
|Probable        |  | solution gas and other by-products)    |  |                 |  |                 |  |               
|Reserves        |  |                                        |  |                 |  |                 |  |               
|                |  | Natural Gas (including by-products but |  | -               |  | 29.2            |  | 29.2          
|                |  | excluding solution gas)                |  |                 |  |                 |  |               

Notes:

|(1) | In Yemen, under the terms of the Production Sharing
        Agreements, income tax is current and assessed on all production sharing
        oil, therefore all Yemen Future Net Revenues are after Yemen income tax.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Canadian values converted to US dollars at the December
        31, 2003 exchange rates of 1.2965 US $'s/Cdn $'s and include the Alberta
        Royalty Tax Credit (ARTC) in the Before and After Income Tax values.

RESERVES DATA(FORECAST PRICES AND COSTS)

SUMMARY OF OIL AND GAS RESERVESTOTAL COMPANYAS OF DECEMBER 31, 2003(FORECAST PRICES AND COSTS)

|                     |  | Light & Medium |  |             |  |                     |  |             |  |          |  |         |  |         
|-------------------- |  | -------------- |  | ----------- |  | ------------------- |  | ----------- |  | -------- |  | ------- |  | --------
|                     |  | Crude Oil      |  | Natural Gas |  | Natural Gas Liquids |  | Total Boe's
|                     |  | Gross(1)       |  | Net(2)      |  | Gross(1)            |  | Net(2)      |  | Gross(1) |  | Net(2)  |  | Gross(1)
|By Category          |  | (MBbls)        |  | (MBbls)     |  | (MMcf)              |  | (MMcf)      |  | (MBbls)  |  | (MBbls) |  | (MBoe)  
|Proven               |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Producing            |  | 2,083          |  | 1,358       |  | 3,155               |  | 2,494       |  | 93       |  | 69      |  | 2,702   
|Non-Producing        |  | 263            |  | 191         |  | 2,475               |  | 1,936       |  | 73       |  | 49      |  | 748     
|Undeveloped          |  | -              |  | -           |  | 1,422               |  | 1,068       |  | 58       |  | 39      |  | 295     
|Total Proven         |  | 2,346          |  | 1,549       |  | 7,052               |  | 5,498       |  | 224      |  | 158     |  | 3,746   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Probable             |  | 2,356          |  | 1,588       |  | 4,917               |  | 3,893       |  | 117      |  | 85      |  | 3,292   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Proven Plus Probable |  | 4,702          |  | 3,137       |  | 11,969              |  | 9,391       |  | 341      |  | 242     |  | 7,037   

---

17

SUMMARY OF OIL AND GAS RESERVES 
  YEMENAS OF DECEMBER 31, 2003
  (FORECAST PRICES AND COSTS)

|                     |  | Light & Medium |  |             |  |                     |  |             |  |          |  |         |  |         
|-------------------- |  | -------------- |  | ----------- |  | ------------------- |  | ----------- |  | -------- |  | ------- |  | --------
|                     |  | Crude Oil      |  | Natural Gas |  | Natural Gas Liquids |  | Total Boe's
|                     |  | Gross(1)       |  | Net(2)      |  | Gross(1)            |  | Net(2)      |  | Gross(1) |  | Net(2)  |  | Gross(1)
|By Category          |  | (MBbls)        |  | (MBbls)     |  | (MMcf)              |  | (MMcf)      |  | (MBbls)  |  | (MBbls) |  | (MBoe)  
|Proven               |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Producing            |  | 2,035          |  | 1,316       |  | -                   |  | -           |  | -        |  | -       |  | 2,035   
|Non-Producing        |  | 228            |  | 160         |  | -                   |  | -           |  | -        |  | -       |  | 228     
|Undeveloped          |  | -              |  | -           |  | -                   |  | -           |  | -        |  | -       |  | -       
|Total Proven         |  | 2,263          |  | 1,476       |  | -                   |  | -           |  | -        |  | -       |  | 2,263   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Probable             |  | 2,342          |  | 1,576       |  | -                   |  | -           |  | -        |  | -       |  | 2,342   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Proven Plus Probable |  | 4,605          |  | 3,052       |  | -                   |  | -           |  | -        |  | -       |  | 4,605   

SUMMARY OF OIL AND GAS RESERVES 
  CANADAAS OF DECEMBER 31, 2003
  (FORECAST PRICES AND COSTS)

|                     |  | Light & Medium |  |             |  |                     |  |             |  |          |  |         |  |         
|-------------------- |  | -------------- |  | ----------- |  | ------------------- |  | ----------- |  | -------- |  | ------- |  | --------
|                     |  | Crude Oil      |  | Natural Gas |  | Natural Gas Liquids |  | Total Boe's
|                     |  | Gross(1)       |  | Net(2)      |  | Gross(1)            |  | Net(2)      |  | Gross(1) |  | Net(2)  |  | Gross(1)
|By Category          |  | (MBbls)        |  | (MBbls)     |  | (MMcf)              |  | (MMcf)      |  | (MBbls)  |  | (MBbls) |  | (MBoe)  
|Proven               |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Producing            |  | 48             |  | 42          |  | 3,155               |  | 2,494       |  | 93       |  | 69      |  | 667     
|Non-Producing        |  | 35             |  | 31          |  | 2,475               |  | 1,936       |  | 73       |  | 49      |  | 520     
|Undeveloped          |  | -              |  | -           |  | 1,422               |  | 1,068       |  | 58       |  | 39      |  | 295     
|Total Proven         |  | 83             |  | 74          |  | 7,052               |  | 5,498       |  | 224      |  | 158     |  | 1,483   
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Probable             |  | 13             |  | 12          |  | 4,917               |  | 3,893       |  | 117      |  | 85      |  | 950     
|                     |  |                |  |             |  |                     |  |             |  |          |  |         |  |         
|Proven Plus Probable |  | 96             |  | 85          |  | 11,969              |  | 9,391       |  | 341      |  | 242     |  | 2,432   

Notes:

|(1) | Gross reserves are the Company's working interest share before the deduction
      of royalties.                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Net reserves are the Company's working interest
        share after the deduction of royalties. Net reserves in Yemen include
        our share of future cost recovery and production sharing oil after the
        Government's royalty interest but before reserves relating to income taxes
        payable. Under this method, a portion of the reported reserves will increase
        as oil prices decrease (and vice versa) as the barrels necessary to achieve
        cost recovery change with prevailing oil prices.

---

18

NET PRESENT VALUES OF FUTURE NET REVENUES 
  TOTAL COMPANYAS OF DECEMBER 31, 2003
  (FORECAST PRICES AND COSTS)

The estimated future net revenues presented do not represent
  fair market value. The estimated future net revenues presented below are calculated
  using the respective Consultant price forecasts and inflation rates as summarized
  in the Notes to Reserves Data Tables (Note 3).

|                           | Before Income Tax(1) |      | After Income Tax (1)
|-------------------------- | -------------------- | ---- | --------------------
|US $'s                     | Discounted at %/yr   |      | Discounted at %/yr  
|$MM                        | 0%                   | 10%  | 15%                 
|                           |                      |      |                     
|Proved                     |                      |      |                     
|                           |                      |      |                     
|Developed producing        | 19.3                 | 15.8 | 14.6                
|Developed non-producing    | 9.2                  | 7.2  | 6.6                 
|Undeveloped                | 3.4                  | 2.0  | 1.6                 
|Total Proved               | 31.9                 | 25.0 | 22.7                
|                           |                      |      |                     
|Probable                   | 22.4                 | 12.7 | 10.0                
|                           |                      |      |                     
|Total Proved Plus Probable | 54.3                 | 37.6 | 32.8                

NET PRESENT VALUES OF FUTURE NET REVENUES 
  YEMENAS OF DECEMBER 31, 2003
  (FORECAST PRICES AND COSTS)

|                           | Before Income Tax(1) |      | After Income Tax (1)
|-------------------------- | -------------------- | ---- | --------------------
|US $'s                     | Discounted at %/yr   |      | Discounted at %/yr  
|$MM                        | 0%                   | 10%  | 15%                 
|                           |                      |      |                     
|Proved                     |                      |      |                     
|                           |                      |      |                     
|Developed producing        | 10.6                 | 9.3  | 8.7                 
|Developed non-producing    | 1.6                  | 1.5  | 1.5                 
|Undeveloped                | -                    | -    | -                   
|Total Proved               | 12.2                 | 10.8 | 10.2                
|                           |                      |      |                     
|Probable                   | 9.8                  | 6.4  | 5.1                 
|                           |                      |      |                     
|Total Proved Plus Probable | 22.0                 | 17.2 | 15.3                

---

19

NET PRESENT VALUES OF FUTURE NET REVENUESCANADAAS OF DECEMBER 31, 2003(FORECAST PRICES AND COSTS)

|                           | Before Income Tax(1) |      | After Income Tax (1)
|-------------------------- | -------------------- | ---- | --------------------
|US $'s                     | Discounted at %/yr   |      | Discounted at %/yr  
|$MM                        | 0%                   | 10%  | 15%                 
|                           |                      |      |                     
|Proved                     |                      |      |                     
|                           |                      |      |                     
|Developed producing        | 8.7                  | 6.5  | 5.8                 
|Developed non-producing    | 7.6                  | 5.7  | 5.1                 
|Undeveloped                | 3.4                  | 2.0  | 1.6                 
|Total Proved               | 19.7                 | 14.2 | 12.5                
|                           |                      |      |                     
|Probable                   | 12.7                 | 6.2  | 4.9                 
|                           |                      |      |                     
|Total Proved Plus Probable | 32.4                 | 20.5 | 17.4                

Notes:

|(1) | In Yemen, under the terms of the Production Sharing
        Agreements, income tax is current and assessed on all production sharing
        oil, therefore all Yemen Future Net Revenues are after Yemen income tax.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Canadian values converted to US dollars at the December
        31, 2003 exchange rates of 1.2965 US $'s/Cdn $'s and include the Alberta
        Royalty Tax Credit (ARTC) in the Before and After Income Tax values.

TOTAL FUTURE NET REVENUES (UNDISCOUNTED) AS AT DECEMBER 31, 2003 
   (FORECAST PRICES AND COSTS)

|                     |  |          |  |           |  |           |  |             |  |             |  | Future Net |  |          |  | Future Net
|-------------------- |  | -------- |  | --------- |  | --------- |  | ----------- |  | ----------- |  | ---------- |  | -------- |  | ----------
|                     |  |          |  |           |  |           |  |             |  |             |  | Revenue    |  |          |  | Revenue   
|                     |  |          |  |           |  |           |  |             |  | Well        |  | Before     |  |          |  | After     
|                     |  |          |  |           |  | Operating |  | Development |  | Abandonment |  | Income     |  | Income   |  | Income    
|                     |  | Revenue  |  | Royalties |  | Costs     |  | Costs       |  | Costs       |  | Taxes      |  | Taxes    |  | Taxes     
|Reserves Category    |  | (US$ MM) |  | (US$ MM)  |  | (US$ MM)  |  | (US$ MM)    |  | (US$ MM)    |  | (US$ MM)   |  | (US$ MM) |  | (US$ MM)  
|                     |  |          |  |           |  |           |  |             |  |             |  |            |  |          |  |           
|Proved Reserves      |  |          |  |           |  |           |  |             |  |             |  |            |  |          |  |           
|Yemen(1)             |  | 51.8     |  | 18.1      |  | 13.1      |  | 2.8         |  | -           |  | 17.9       |  | 5.7      |  | 12.2      
|Canada(2)            |  | 34.5     |  | 5.7       |  | 7.3       |  | 1.4         |  | 0.4         |  | 19.7       |  | 0.8      |  | 18.9      
|Total Company        |  | 86.4     |  | 23.8      |  | 20.4      |  | 4.2         |  | 0.4         |  | 37.6       |  | 6.5      |  | 31.1      
|                     |  |          |  |           |  |           |  |             |  |             |  |            |  |          |  |           
|Proved Plus Probable |  |          |  |           |  |           |  |             |  |             |  |            |  |          |  |           
|Reserves             |  |          |  |           |  |           |  |             |  |             |  |            |  |          |  |           
|Yemen(1)             |  | 104.5    |  | 35.6      |  | 25.3      |  | 11.5        |  | -           |  | 32.1       |  | 10.1     |  | 22.0      
|Canada(2)            |  | 57.9     |  | 9.6       |  | 13.3      |  | 2.2         |  | 0.5         |  | 32.4       |  | 4.6      |  | 27.8      
|Total Company        |  | 162.4    |  | 45.1      |  | 38.6      |  | 13.7        |  | 0.5         |  | 64.5       |  | 14.7     |  | 49.8      

Notes:

|(1) | In Yemen, under the terms of the Production Sharing
        Agreements, income tax is current and assessed on all production sharing
        oil, therefore all Yemen Future Net Revenues are after Yemen income tax.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Canadian values converted to US dollars at the December
        31, 2003 exchange rates of 1.2965 US $'s/Cdn $'s and include the Alberta
        Royalty Tax Credit (ARTC) in the Before and After Income Tax values.

---

20

TOTAL FUTURE NET REVENUES 
  BY PRODUCTION GROUPAS AT DECEMBER 31, 2003
  (FORECAST PRICES AND COSTS)

|                |  |                                        |  | Yemen           |  | Canada          |  | Total Company  
|--------------- |  | -------------------------------------- |  | --------------- |  | --------------- |  | ---------------
|                |  |                                        |  | Future net      |  | Future net      |  | Future net     
|                |  |                                        |  | Revenue Before  |  | Revenue Before  |  | Revenue Before 
|                |  |                                        |  | Income Taxes(1) |  | Income Taxes(2) |  | Income Taxes(1)
|                |  |                                        |  | (discounted at  |  | (discounted at  |  | (discounted at 
|Reserves        |  |                                        |  | 10%/year)       |  | 10%/year)       |  | 10%/year)      
|Category        |  | Product Group                          |  | (US$MM)         |  | (US$MM)         |  | (US$MM)        
|                |  |                                        |  |                 |  |                 |  |                
|Proved Reserves |  | Light and Medium Crude Oil (including  |  | 10.8            |  | 1.2             |  | 11.9           
|                |  | solution gas and other by-products)    |  |                 |  |                 |  |                
|                |  | Natural Gas (including by-products but |  | -               |  | 13.0            |  | 13.0           
|                |  | excluding solution gas)                |  |                 |  |                 |  |                
|                |  |                                        |  |                 |  |                 |  |                
|Proved Plus     |  | Light and Medium Crude Oil (including  |  | 17.2            |  | 1.4             |  | 18.6           
|Probable        |  | solution gas and other by-products)    |  |                 |  |                 |  |                
|Reserves        |  |                                        |  |                 |  |                 |  |                
|                |  | Natural Gas (including by-products but |  | -               |  | 19.1            |  | 19.1           
|                |  | excluding solution gas)                |  |                 |  |                 |  |                

Notes:

|(1) | In Yemen, under the terms of the Production Sharing
        Agreements, income tax is current and assessed on all production sharing
        oil, therefore all Yemen Future Net Revenues are after Yemen income tax.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Canadian values converted to US dollars at the December
        31, 2003 exchange rates of 1.2965 US $'s/Cdn $'s and include the Alberta
        Royalty Tax Credit (ARTC) in the Before and After Income Tax values.

Notes to Reserves Data Tables:

|1. | Columns may not add due to rounding.                                                                                                                                                                                                                                
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. | The crude oil, natural gas liquids and
        natural gas reserve estimates presented in the OSA and Fekete Reports
        are based on the definitions and guidelines contained in the COGE Handbook.
        A summary of those definitions are set forth below.
|  
|   | Reserve Categories                                                                                                                                                                                                                                                  
|  
|   | Reserves are estimated remaining quantities
        of oil and natural gas and related substances anticipated to be recoverable
        from known accumulations, from a given date forward, based on                                                               
|  
|   | •                                                                                                                                                                                                                                                                   
|   | •                                                                                                                                                                                                                                                                   
|   | •                                                                                                                                                                                                                                                                   
|  
|   | Reserves are classified according to the degree of
        certainty associated with the estimates.                                                                                                                                                                 
|  

|(a) | Proved reservesare those reserves that can
        be estimated with a high degree of certainty to be recoverable. It is
        likely that the actual remaining quantities recovered will exceed the
        estimated proved reserves.                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(b) | Probable reservesare those additional reserves
        that are less certain to be recovered than proved reserves. It is equally
        likely that the actual remaining quantities recovered will be greater
        or less than the sum of the estimated proved plus probable reserves.

---

21

|    | Other criteria that must also be met for
        the categorization of reserves are provided in the COGE Handbook.
      Each of the reserve categories (proved and probable)
        may be divided into developed and undeveloped categories:                                                                                                                                                                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(c) | Developed reservesare those reserves
        that are expected to be recovered from existing wells and installed facilities
        or, if facilities have not been installed, that would involve a low expenditure
        (for example, when compared to the cost of drilling a well) to put the
        reserves on production. The developed category may be subdivided into
        producing and non-producing.                                                                                                                                                
|   
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   
|(d) | Undeveloped reservesare those
        reserves expected to be recovered from known accumulations where a significant
        expenditure (for example, when compared to the cost of drilling a well)
        is required to render them capable of production. They must fully meet
        the requirements of the reserves classification (proved, probable) to
        which they are assigned.                                                                                                                                                                   
|   
|    | In multi-well pools it may be appropriate
        to allocate total pool reserves between the developed and undeveloped
        categories or to subdivide the developed reserves for the pool between
        developed producing and developed non-producing. This allocation should
        be based on the estimator's assessment as to the reserves that will be
        recovered from specific wells, facilities and completion intervals in
        the pool and their respective development and production status.                                         
|   
|    | Levels of Certainty for Reported
        Reserves                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|    | The qualitative certainty levels referred
        to in the definitions above are applicable to individual reserve entities
        (which refers to the lowest level at which reserves calculations are performed)
        and to reported reserves (which refers to the highest level sum of individual
        entity estimates for which reserves are presented). Reported reserves
        should target the following levels of certainty under a specific set of
        economic conditions:                                                                 
|   
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|    | A qualitative measure of the certainty
        levels pertaining to estimates prepared for the various reserves categories
        is desirable to provide a clearer understanding of the associated risks
        and uncertainties. However, the majority of reserves estimates will be
        prepared using deterministic methods that do not provide a mathematically
        derived quantitative measure of probability. In principle, there should
        be no difference between estimates prepared using probabilistic or deterministic
        methods.
|   
|    | Additional clarification of certainty
        levels associated with reserves estimates and the effect of aggregation
        is provided in the COGE Handbook.                                                                                                                                                                                                                                                                                                                                                                                                      

---

22

|3. | Forecast Prices and Costs                                                                                                                                                                                                                                                          
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | The forecast cost and price assumptions assume increases
        in wellhead selling prices and take into account inflation with respect
        to future operating and capital costs.                                                                                            
|  
|   | For the Yemen Reserves, Crude oil benchmark reference
        pricing, as at December 31, 2003, inflation and exchange rates utilized
        by Fekete in the Fekete Report, which were Fekete's then current forecasts
        at the date of the Fekete Report, were as follows:

|           |  | WTI Cushing |  | INFLATION 
|---------- |  | ----------- |  | ----------
|           |  | Oklahoma    |  | RATES (1) 
|Year       |  | ($US/bbl)   |  | %/Year    
|           |  |             |  |           
|           |  |             |  |           
|Forecast   |  |             |  |           
|2004       |  | 26.50       |  | 2.0       
|2005       |  | 23.50       |  | 2.0       
|2006       |  | 23.50       |  | 2.0       
|2007       |  | 24.00       |  | 2.0       
|2008       |  | 24.48       |  | 2.0       
|Thereafter |  | +2.0%/year  |  | +2.0%/year

Note

|(1) | Inflation rates for forecasting
        prices and costs.                                                                                                                                                                                                                                         
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                   
|    | The weighted average historical
        price in US $'s realized by the Corporation in Yemen, for the year ended
        Dec. 31, 2003 for crude oil was $28.13/bbl.                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                   
|    | For the Canadian Reserves,
        crude oil and natural gas benchmark reference pricing, as at December
        31, 2003, inflation and exchange rates utilized by OSA in the OSA Report,
        which were OSA's then current forecasts at the date of the OSA Report,
        were as follows:

|           |  | Crude Oil   |  |               |  |                   |  |                     |  |              |  |            |  |           
|---------- |  | ----------- |  | ------------- |  | ----------------- |  | ------------------- |  | ------------ |  | ---------- |  | ----------
|           |  | WTI Cushing |  | Edmonton Par  |  | Natural Gas AECO  |  |                     |  |              |  |            |  | Inflation 
|           |  | Oklahoma    |  | Price 40° API |  | Spot Gas Price    |  | Natural Gas Liquids |  | Rates (1)    |  | Rate(2)   
|Year       |  | (US$/bbl)   |  | (Cdn$/bbl)    |  | (Cdn$/Mcf)        |  | FOB Edmonton        |  | %
      Year |  | (US$/Cdn$)
|           |  |             |  |               |  |                   |  | Condensate          |  | Butane       |  | Propane    |  |           
|Forecast   |  |             |  |               |  |                   |  |                     |  | (Cdn$/bbl)   |  |            |  |           
|2004       |  | 26.39       |  | 34.16         |  | 5.56              |  | 34.84               |  | 23.91        |  | 21.52      |  | 1.5       
|2005       |  | 24.21       |  | 31.68         |  | 4.79              |  | 32.32               |  | 22.18        |  | 19.96      |  | 1.5       
|2006       |  | 23.53       |  | 31.19         |  | 4.63              |  | 31.82               |  | 21.83        |  | 19.65      |  | 1.5       
|2007       |  | 23.88       |  | 32.12         |  | 4.68              |  | 32.77               |  | 22.49        |  | 20.24      |  | 1.5       
|2008       |  | 24.24       |  | 32.61         |  | 4.66              |  | 33.26               |  | 22.82        |  | 20.54      |  | 1.5       
|Thereafter |  | +1.5%/year  |  | +1.5%/year    |  | +1.2%/yr to 14    |  | +1.5%/year          |  | +1.5%/year   |  | +1.5%/year |  | +1.5%/year
|           |  |             |  |               |  | +1.5%/yr after 14 |  |                     |  |              |  |            |  |           

|Notes: |                                                                                    
|------ | -----------------------------------------------------------------------------------
|       |                                                                                    
|(1)    | Inflation rates for forecasting prices and costs.                                  
|(2)    | Exchange rates used to generate the benchmark reference prices
      in this table.

The weighted average historical prices in Cdn $'s realized
  by the Corporation in Canada, for the year ended December 31, 2003, were $7.36/mcf
  for natural gas, $37.82/bbl for crude oil and $32.81/bbl for natural gas liquids.

---

23

|4. | Constant Prices and Costs
|-- | -------------------------

In Yemen, a constant price of $30.05/bbl (Dec. 2003 actual prices) was utilized
  in the Fekete constant price case.

In Canada, constant prices of $27.78/bbl of oil and $5.45/Mcf of natural gas
  (Dec. 2003 actual prices converted to US $'s at the Dec. 31, 2003 currency rate
  of 1.2965 US$/Cdn$), were utilized in the OSA constant price case.

|5. | Future Development Costs
|-- | ------------------------

FUTURE DEVELOPMENT COSTS 
  TOTAL COMPANY(1)AS AT DECEMBER 31, 2003

|(US$thousands)          | Constant Prices and Costs |  | Forecast Prices and Costs
|----------------------- | ------------------------- |  | -------------------------
|                        |                           |  |                          
|                        |                           |  | Proved Plus              
|                        | Proved                    |  | Probable                 
|Year                    | Reserves                  |  | Reserves                 
|2004                    | 3,465.1                   |  | 12,431.8                 
|2005                    | 702.8                     |  | 1,080.3                  
|2006                    | -                         |  | -                        
|2007                    | -                         |  | -                        
|2008                    | -                         |  | 38.5                     
|                        |                           |  |                          
|Total Undiscounted      | 4,178.6                   |  | 13,718.0                 
|                        |                           |  |                          
|Total Discounted at 10% | 4,047.5                   |  | 13,478.1                 

Note:

|(1) | Cdn$'s converted at the December 31, 2003 year end rate of 1.2965 US$/Cdn$.
|--- | ---------------------------------------------------------------------------

FUTURE DEVELOPMENT COSTS
  YEMENAS AT DECEMBER 31, 2003

|(US$thousands)          | Constant Prices and Costs |  | Forecast Prices and Costs
|----------------------- | ------------------------- |  | -------------------------
|                        |                           |  | Proved Plus              
|                        | Proved                    |  | Probable                 
|Year                    | Reserves                  |  | Reserves                 
|2004                    | 2,764.0                   |  | 11,502.0                 
|2005                    | -                         |  | -                        
|2006                    | -                         |  | -                        
|2007                    | -                         |  | -                        
|2008                    | -                         |  | -                        
|                        |                           |  |                          
|Total Undiscounted      | 2,764.0                   |  | 11,502.0                 
|                        |                           |  |                          
|Total Discounted at 10% | 2,764.0                   |  | 11,502.0                 

---

24

FUTURE DEVELOPMENT COSTSCANADA(1)AS AT DECEMBER 31, 2003

|(US$thousands)          | Constant Prices and Costs |  | Forecast Prices and Costs
|----------------------- | ------------------------- |  | -------------------------
|                        |                           |  | Proved Plus              
|                        | Proved                    |  | Probable                 
|Year                    | Reserves                  |  | Reserves                 
|2004                    | 701.1                     |  | 929.8                    
|2005                    | 702.8                     |  | 1,080.3                  
|2006                    | -                         |  | -                        
|2007                    | -                         |  | -                        
|2008                    | -                         |  | 38.5                     
|                        |                           |  |                          
|Total Undiscounted      | 1,414.6                   |  | 2,216.0                  
|                        |                           |  |                          
|Total Discounted at 10% | 1,283.5                   |  | 1,976.1                  



|   | Note:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | (1)         Cdn$'s
        converted at the December 31, 2003 year end rate of 1.2965 US$/Cdn$.                                                                                                                                                                                                                                                                                                                                                                                                         
|  
|   | The Corporation expects to fund the future development
        costs noted above through the use of working capital, cash flow, debt
        and equity financing as required.                                                                                                                                                                                                                                                                                                                          
|  
|6. | The Alberta royalty tax credit ("ARTC") is included
        in the cumulative cash flow amounts. ARTC is based on the program announced
        November 1989 by the Alberta government with modifications effective January
        1, 1995.                                                                                                                                                                                                                                                           
|  
|7. | In Yemen, estimated future abandonment and reclamations
        costs related to properties evaluated have not been taken into account
        by Fekete in determining the aggregate future net revenue therefrom. Under
        the terms of the production sharing agreements, ownership in the facilities
        and wells is transferred to the Government of Yemen through cost recovery.
        Therefore the future abandonment and reclamation costs have been assessed
        a zero value.
|  
|   | In Canada, estimated future abandonment and reclamation
        costs related to a property have been taken into account by OSA in determining
        reserves that should be attributed to a property and in determining the
        aggregate future net revenue therefrom, there was deducted the reasonable
        estimated future well abandonment costs. No allowance was made, however,
        for reclamation of wellsites or the abandonment and reclamation of any
        facilities.    
|  
|8. | Both the constant and forecast price and cost assumptions
        assume the continuance of current laws and regulations.                                                                                                                                                                                                                                                                                                                                                                               
|  
|9. | The extent and character of all factual data supplied
        to OSA and Fekete were accepted by OSA and Fekete as represented respectively.
        No field inspections were conducted by OSA or Fekete.                                                                                                                                                                                                                                                                                              

---

25

Reconciliations of Changes in Reserves and Future Net Revenue

RECONCILIATION OF NET RESERVES(AFTER ROYALTIES/BEFORE TAXES)BY PRINCIPAL PRODUCT TYPECOMPANYAS AT DECEMBER 31, 2003(FORECAST PRICES AND COSTS)

|              |  |                    |          |                |  | ASSOCIATED & NON-   |          |          |  |       
|------------- |  | ------------------ | -------- | -------------- |  | ------------------- | -------- | -------- |  | ------
|              |  | LIGHT & MEDIUM OIL |          | ASSOCIATED GAS |  | NATURAL GAS LIQUIDS
|              |  |                    |          | Net            |  |                     |          | Net      |  |       
|              |  |                    |          | Proved         |  |                     |          | Proved   |  |       
|              |  | Net                | Net      | Plus           |  | Net                 | Net      | Plus     |  | Net   
|              |  | Proved             | Probable | Probable       |  | Proved              | Probable | Probable |  | Proved
|FACTORS       |  | (MBbl)             | (MBbl)   | (MBbl)         |  | (MMcf)              | (MMcf)   | (MMcf)   |  | (MBbl)
|Dec. 31, 2002 |  | 1,063              | 84       | 1,147          |  | 2,780               | 1,149    | 3,929    |  | 86    
|Extensions    |  | 894                | 170      | 1,065          |  | 3,133               | 1,812    | 4,945    |  | 98    
|Improved      |  |                    |          |                |  |                     |          |          |  |       
|recovery      |  | -                  | -        | -              |  | -                   | -        | -        |  | -     
|Technical     |  |                    |          |                |  |                     |          |          |  |       
|Revisions     |  | 15                 | 2        | 17             |  | (989)               | 909      | (80)     |  | (21)  
|Discoveries   |  | 160                | 1,332    | 1,492          |  | 946                 | 413      | 1,359    |  | 2     
|Acquisitions  |  | -                  | -        | -              |  | -                   | -        | -        |  | -     
|Dispositions  |  | -                  | -        | -              |  | -                   | (391)    | (391)    |  | -     
|Economic      |  |                    |          |                |  |                     |          |          |  |       
|Factors       |  | -                  | -        | -              |  | 1                   | 1        | 2        |  | -     
|Production    |  | (583)              | -        | (583)          |  | (373)               | -        | (373)    |  | (7)   
|Dec. 31, 2003 |  | 1,549              | 1,588    | 3,137          |  | 5,498               | 3,893    | 9,391    |  | 158   

RECONCILIATION OF NET RESERVES(AFTER ROYALTIES/BEFORE TAXES)BY PRINCIPAL PRODUCT TYPEYEMENAS AT DECEMBER 31, 2003(FORECAST PRICES AND COSTS)

|              |  |                    |          |                |  | ASSOCIATED & NON-   |          |          |  |       
|------------- |  | ------------------ | -------- | -------------- |  | ------------------- | -------- | -------- |  | ------
|              |  | LIGHT & MEDIUM OIL |          | ASSOCIATED GAS |  | NATURAL GAS LIQUIDS
|              |  |                    |          | Net            |  |                     |          | Net      |  |       
|              |  |                    |          | Proved         |  |                     |          | Proved   |  |       
|              |  | Net                | Net      | Plus           |  | Net                 | Net      | Plus     |  | Net   
|              |  | Proved             | Probable | Probable       |  | Proved              | Probable | Probable |  | Proved
|FACTORS       |  | (MBbl)             | (MBbl)   | (MBbl)         |  | (MMcf)              | (MMcf)   | (MMcf)   |  | (MBbl)
|Dec. 31, 2002 |  | 1,012              | 80       | 1,092          |  | -                   | -        | -        |  | -     
|Extensions    |  | 875                | 165      | 1,040          |  | -                   | -        | -        |  | -     
|Improved      |  |                    |          |                |  |                     |          |          |  |       
|recovery      |  | -                  | -        | -              |  | -                   | -        | -        |  | -     
|Technical     |  |                    |          |                |  |                     |          |          |  |       
|Revisions     |  | -                  | -        | -              |  | -                   | -        | -        |  | -     
|Discoveries   |  | 160                | 1,332    | 1,492          |  | -                   | -        | -        |  | -     
|Acquisitions  |  | -                  | -        | -              |  | -                   | -        | -        |  | -     
|Dispositions  |  | -                  | -        | -              |  | -                   | -        | -        |  | -     
|Economic      |  |                    |          |                |  |                     |          |          |  |       
|Factors       |  | -                  | -        | -              |  | -                   | -        | -        |  | -     
|Production    |  | (572)              | -        | (572)          |  | -                   | -        | -        |  | -     
|Dec. 31, 2003 |  | 1,476              | 1,576    | 3,052          |  | -                   | -        | -        |  | -     

---

26

RECONCILIATION OF NET RESERVES(AFTER ROYALTIES/BEFORE TAXES)BY PRINCIPAL PRODUCT TYPECANADAAS AT DECEMBER 31, 2003(FORECAST PRICES AND COST)

|              |  |                    |          |                |  | ASSOCIATED & NON-   |          |          |  |       
|------------- |  | ------------------ | -------- | -------------- |  | ------------------- | -------- | -------- |  | ------
|              |  | LIGHT & MEDIUM OIL |          | ASSOCIATED GAS |  | NATURAL GAS LIQUIDS
|              |  |                    |          | Net            |  |                     |          | Net      |  |       
|              |  |                    |          | Proved         |  |                     |          | Proved   |  |       
|              |  | Net                | Net      | Plus           |  | Net                 | Net      | Plus     |  | Net   
|              |  | Proved             | Probable | Probable       |  | Proved              | Probable | Probable |  | Proved
|FACTORS       |  | (MBbl)             | (MBbl)   | (MBbl)         |  | (MMcf)              | (MMcf)   | (MMcf)   |  | (MBbl)
|Jan. 1, 2003  |  | 51                 | 4        | 55             |  | 2,780               | 1,149    | 3,929    |  | 86    
|Extensions    |  | 19                 | 6        | 25             |  | 3,133               | 1,812    | 4,945    |  | 98    
|Improved      |  |                    |          |                |  |                     |          |          |  |       
|recovery      |  | -                  | -        | -              |  | -                   | -        | -        |  | -     
|Technical     |  |                    |          |                |  |                     |          |          |  |       
|Revisions     |  | 15                 | 2        | 17             |  | (989)               | 909      | (80)     |  | (21)  
|Discoveries   |  | -                  | -        | -              |  | 946                 | 413      | 1,359    |  | 2     
|Acquisitions  |  | -                  | -        | -              |  | -                   | -        | -        |  | -     
|Dispositions  |  | -                  | -        | -              |  | -                   | (391)    | (391)    |  | -     
|Economic      |  |                    |          |                |  |                     |          |          |  |       
|Factors       |  | -                  | -        | -              |  | 1                   | 1        | 2        |  | -     
|Production    |  | (11)               | -        | (11)           |  | (373)               | -        | (373)    |  | (7)   
|Dec. 31, 2003 |  | 74                 | 12       | 85             |  | 5,498               | 3,893    | 9,391    |  | 158   

RECONCILIATION OF CHANGES
  IN 
  NET PRESENT VALUES OF FUTURE NET REVENUEDISCOUNTED AT 10% PER YEAR 
  PROVED RESERVES 
  (CONSTANT PRICES AND COSTS)

|                                                                               | Canada(1) |   | Yemen   |   | Total(1) |  
|------------------------------------------------------------------------------ | --------- | - | ------- | - | -------- | -
|                                                                               | 2003      |   | 2003    |   | 2003     |  
|US$'s                                                                          | (M$)      |   | (M$)    |   | (M$)     |  
|Estimated Future Net Revenue at beginning of year                              | 8,761     |   | 11,904  |   | 20,665   |  
|Sales and transfers
      of oil and gas produced, net of production costs and | (1,842    | ) | (11,613 | ) | (13,455  | )
|royalties                                                                      |           |   |         |   |          |  
|Net change in prices,
      production costs and royalties related to future   | 564       |   | (1,574  | ) | (1,010   | )
|production                                                                     |           |   |         |   |          |  
|Changes in previously
      estimated development costs incurred during the    | 1,472     |   | 4,348   |   | 5,820    |  
|period                                                                         |           |   |         |   |          |  
|Changes in estimated
      future development costs                            | (1,214    | ) | (997    | ) | (2,211   | )
|Extensions and improved
      recovery                                         | 10,291    |   | 12,605  |   | 22,896   |  
|Discoveries                                                                    | 3,313     |   | 2,575   |   | 5,888    |  
|Acquisitions of
      reserves                                                 | -         |   | -       |   | -        |  
|Dispositions of
      reserves                                                 | -         |   | -       |   | -        |  
|Net change resulting
      from revisions in quantity estimates                | (2,834    | ) | -       |   | (2,834   | )
|Accretion of discount                                                          | 834       |   | 1,190   |   | 2,024    |  
|Net change in income
      taxes                                               | (2,486    | ) | (2,755  | ) | (5,241   | )
|Other (value of
      production in disposed and acquired properties, changes  |           |   |         |   |          |  
|in timing of future
      production)                                          | (659      | ) | -       |   | (659     | )
|Other (effects of
      currency conversion in Canada)                         | 2,501     |   | -       |   | 2,501    |  
|                                                                               |           |   |         |   |          |  
|Estimated Future Net Revenue at end of year                                    | 18,701    |   | 15,683  |   | 34,384   |  

Note:

|(1) | In Canada values were converted to US currency using
        the following currency exchange rates: Dec. 31, 2002 at 1.5776 $US/$Cdn
        , Dec. 31, 2003 at 1.2965, Sale and transfers of oil and gas produced,
        net of production costs and royalties at Booked values for the year and
        at the 2003 year average exchange rate of 1.4010 for all other changes.
        The estimated Future Net Revenues include ARTC.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

27

Additional Information Relating to Reserves Data

Undeveloped Reserves

The following tables set forth the proved undeveloped reserves
  and the probable undeveloped reserves, each by product type, attributed to the
  Corporation in 2003.

Proved Undeveloped Reserves

|         |  | Light and Medium Oil |  | Natural Gas |  | Natural Gas Liquids
|-------- |  | -------------------- |  | ----------- |  | -------------------
|Year     |  | (Mbbl)               |  | (MMcf)      |  | (Mbbl)             
|         |  | First                |  | Cumulative  |  | First              
|         |  | Attributed           |  | at Year End |  | Attributed         
|         |  |                      |  |             |  |                    
|2003 (1) |  | -                    |  | -           |  | 1,422              

Note:

|(1) | Prior to 2003, the Corporation did not have any
        proved undeveloped reserves. All the Proven Undeveloped reserves assigned
        in 2003 were in Canada, and relate to the Wabamum formation in the Nevis
        area. It is expected that down spacing to 320 acres will be approved in
        the next year, with drilling (2 wells) planned for 2004/2005.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Probable Undeveloped Reserves

|         |  | Light and Medium Oil |  | Natural Gas |  | Natural Gas Liquids
|-------- |  | -------------------- |  | ----------- |  | -------------------
|Year     |  | (Mbbl)               |  | (MMcf)      |  | (Mbbl)             
|         |  | First                |  | Cumulative  |  | First              
|         |  | Attributed           |  | at Year End |  | Attributed         
|         |  |                      |  |             |  |                    
|2000 (1) |  | -                    |  | -           |  | 271                
|2001     |  |                      |  |             |  |                    
|2002     |  |                      |  |             |  |                    
|2003(2)  |  | 2,342                |  | 2,342       |  | 1,328              

Note:

|(1) | In 2000 probable undeveloped reserves we assigned to an un-drilled gas
      spacing unit it Canada, which is scheduled to be drilled in the second quarter
      of 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) | In 2003, Probable Undeveloped Reserves were assigned
        in Yemen and Canada. The light oil reserves were assigned to a portion
        of the mapped An Nagyah light oil discovery on Block S-1 in Yemen. The
        An Nagyah pool is scheduled for development during 2004 and 2005; with
        the installation of a central production facility, an 18 mile export pipe
        line, associated gathering facilities and drilling appraisal development
        wells. Drilling commenced in the 1 st quarter of 2004 and is expected
        to continue into 2005, and it is expected the facilities will be operational
        by the 2 nd quarter of 2005. The Natural Gas reserves and associated liquids
        were assigned in Canada, and generally related to the Wabamum formation
        in the Nevis area. It is expected that down spacing to 320 acres will
        be approved in the next year, with drilling (2 wells) planned for 2004/2005.

---

28

Other Oil and Gas Information

Oil And Gas Wells

The following table sets forth the number and status of wells
  in which the Corporation has a working interest as at December 31, 2003. All
  of the Corporation's wells are located on shore.

|                | Oil Wells |  | Natural Gas Wells
|--------------- | --------- |  | -----------------
|                | Producing |  | Non-Producing    
|                | Gross     |  | Net              
|                |           |  |                  
|Yemen           | 9         |  | 1.3              
|Canada, Alberta | 7         |  | 3.5              
|Total           | 16        |  | 4.8              

Properties with no Attributable Reserves

The following table sets out the Corporation's developed and undeveloped land
  holdings as at December 31, 2003.

|                | Developed Acres |  | Undeveloped Acres |  | Total Acres
|--------------- | --------------- |  | ----------------- |  | -----------
|                | Gross           |  | Net               |  | Gross      
|                |                 |  |                   |  |            
|Yemen           | 10,760          |  | 1,987             |  | 420,010    
|Canada, Alberta | 10,780          |  | 6,680             |  | 28,400     
|Total           | 21,540          |  | 8,667             |  | 448,410    

Of the Corporation's undeveloped land, the rights to explore,
  develop and exploit 2,347 net acres may expire in Canada by December 31, 2004.
  The Corporation does not have any work commitments associated with its undeveloped
  lands in Yemen or Canada.

Forward Contracts

At December, 31, 2003 all of the Corporation's contracts to
  sell crude oil or natural gas were at prevailing market pricing. Subsequent
  to year-end, the Company entered into a fixed price natural gas contract to
  sell 1,500 GJ/day at a price of $5.795 Cdn/GJ from April 1, 2004 to October
  31, 2004.

Additional Information Concerning Abandonment and Reclamation
  Costs

In Canada, future well abandonment costs net of salvage were
  included in the OSA reserves evaluation presented here in. Cost in US $'s to
  abandon approximately 31 (20.2 net) wells totalled $409 thousand undiscounted,
  or $219 thousand discounted at 10%, are included in the estimate of future net
  revenue from total proved plus probable reserves using constant pricing and
  cost. Approximately $170 thousand undiscounted, or $131 thousand discounted
  at 10%, are scheduled during the next 3 years (2004-2006).

---

29

Production Estimates

The following table sets out the volume of the Corporation's
  daily production (working interest before royalties) estimated for the year
  ended December 31, 2004 which is reflected in the estimate of future net revenue
  disclosed in the Forecast Prices and Costs and Constant Prices and Costs tables
  contained under " - Disclosure of Reserves Data".

|                   | Yemen          |  | Canada         |  | Canada        |  | Canada         |  | Total        
|------------------ | -------------- |  | -------------- |  | ------------- |  | -------------- |  | -------------
|                   | Light and      |  | Light and      |  | Natural       |  | Natural Gas    |  | Company      
|                   | Medium Oil     |  | Medium Oil     |  | Gas           |  | Liquids        |  | BOE          
|                   | Gross (bbls/d) |  | Gross (bbls/d) |  | Gross (mcf/d) |  | Gross (bbls/d) |  | Gross (BOE/d)
|Proved Producing   | 2,168          |  | 54             |  | 2,096         |  | 54             |  | 2,625        
|Proved Developed   |                |  |                |  |               |  |                |  |              
|Non-Producing      | 522            |  | 13             |  | 1,440         |  | 39             |  | 814          
|Proved Undeveloped | -              |  | -              |  | -             |  | -              |  | -            
|Total Proved       | 2,690          |  | 67             |  | 3,536         |  | 93             |  | 3,439        
|Total Probable     | 67             |  | 4              |  | 418           |  | 2              |  | 142          
|Total Proved Plus  |                |  |                |  |               |  |                |  |              
|Probable           | 2,757          |  | 71             |  | 3,954         |  | 95             |  | 3,581        

In Yemen the Proved Producing and the Probable numbers represent
  the Tasour field in Block 32 and the Proved Developed Non-Producing numbers
  represent the An Nagyah field in Block S-1.

Exploration and Development Activities

The following tables set forth the gross and net exploratory
  and development wells which TransGlobe drilled during the year ended December
  31, 2003:

|Canada:               | Gross       |  | Net        
|--------------------- | ----------- |  | -----------
|                      | Exploration |  | Development
|Natural Gas           | 1           |  | 5          
|Crude Oil             | -           |  | 2          
|Dry and Abandoned (1) | -           |  | 1          
|Total                 | 1           |  | 8          
|                      |             |  |            
|Yemen:                | Gross       |  | Net        
|                      | Exploration |  | Development
|Natural Gas           | 1           |  | -          
|Crude Oil             | 3           |  | 3          
|Dry and Abandoned(1)  | 1           |  | -          
|Total                 | 5           |  | 3          

Note:

|(1) | "Dry well" means a well which is not a productive
        well or a service well. A productive well is a well which is capable of
        producing oil and gas in commercial quantities or in quantities considered
        by the operator to be sufficient to justify the costs required to complete,
        equip and produce the well. A service well means a well such as a water
        or gas-injection, water-source or water-disposal well. Such wells do not
        have marketable reserves of crude oil or natural gas attributed to them
        but are essential to the production of the crude oil and natural gas reserves.
        Includes 1 Gross (1.0 Net) cased potential gas well in Canada.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Production History

The following table summarizes certain information in respect
  of production, product prices received and operating expenses made by the Company
  (and its subsidiaries) for the periods indicated below:

---

30

|                                          |  | 2003          |  | 2002         
|----------------------------------------- |  | ------------- |  | -------------
|                                          |  | Quarter Ended |  | Quarter Ended
|                                          |  | Mar. 31       |  | Jun. 30      
|Average Daily Production                  |  |               |  |              
|Yemen                                     |  |               |  |              
|Light and Medium
      Crude Oil (Bbls/d) |  | 2,307         |  | 2,280        
|Canada                                    |  |               |  |              
|Light and Medium
      Crude Oil (Bbls/d) |  | 31            |  | 32           
|Gas (Mcf/d)                               |  | 966           |  | 1,017        
|NGL (Bbls/d)                              |  | 18            |  | 18           
|Combined(BOE/d)                           |  | 2,518         |  | 2,499        
|                                          |  |               |  |              
|Average Price Received                    |  |               |  |              
|Yemen                                     |  |               |  |              
|Light and Medium
      Crude Oil ($/Bbl)  |  | 29.74         |  | 25.71        
|Canada                                    |  |               |  |              
|Light and Medium
      Crude Oil ($/Bbl)  |  | 29.76         |  | 25.23        
|Gas ($/Mcf)                               |  | 5.56          |  | 5.63         
|NGL ($/Bbl)                               |  | 26.58         |  | 21.68        
|Combined($/BOE)                           |  | 29.95         |  | 26.22        
|                                          |  |               |  |              
|Royalties                                 |  |               |  |              
|Yemen                                     |  |               |  |              
|Light and Medium
      Crude Oil ($/Bbl)  |  | 11.29         |  | 8.46         
|Canada                                    |  |               |  |              
|Light and Medium
      Crude Oil ($/Bbl)  |  | 3.42          |  | 2.80         
|Gas ($/Mcf)                               |  | 0.84          |  | 0.96         
|NGL ($/Bbl)                               |  | 8.80          |  | 7.22         
|Combined($/BOE)                           |  | 10.77         |  | 8.19         
|                                          |  |               |  |              
|Operating Expenses                        |  |               |  |              
|Yemen                                     |  |               |  |              
|Light and Medium
      Crude Oil ($/Bbls) |  | 3.07          |  | 4.06         
|Canada                                    |  |               |  |              
|Light and Medium
      Crude Oil ($/Bbls) |  | 7.99          |  | 6.32         
|Gas ($/Mcf)                               |  | 1.32          |  | 1.31         
|NGL ($/Bbls)                              |  | -             |  | -            
|Combined($/BOE)                           |  | 3.42          |  | 4.31         
|                                          |  |               |  |              
|Netback Received                          |  |               |  |              
|Yemen                                     |  |               |  |              
|Light and Medium
      Crude Oil ($/Bbl)  |  | 15.37         |  | 13.20        
|Canada                                    |  |               |  |              
|Light and Medium
      Crude Oil ($/Bbl)  |  | 18.35         |  | 16.11        
|Gas ($/Mcf)                               |  | 3.40          |  | 3.36         
|NGL ($/Bbl)                               |  | 17.78         |  | 14.47        
|Combined($/BOE)                           |  | 15.75         |  | 13.72        

---

31

The following table indicates the Company's average daily
  production from its important fields for the year ended December 31, 2003.

|       | Light and Medium |  |         |  |          |  |        
|------ | ---------------- |  | ------- |  | -------- |  | -------
|       | Crude            |  | Gas     |  | NGLS     |  | BOE    
|       | (Bbls/d)         |  | (Mcf/d) |  | (Bbls/d) |  | (BOE/d)
|       |                  |  |         |  |          |  |        
|Canada | 35               |  | 1,200   |  | 28       |  | 263    
|Yemen  | 2,372            |  | -       |  | -        |  | 2,372  
|Total  | 2,407            |  | 1,200   |  | 28       |  | 2,635  

SELECTED CONSOLIDATED FINANCIAL INFORMATION

The following is a summary of selected financial information of TransGlobe
  for the periods indicated.

|                                    | Years Ended December 31,
|----------------------------------- | ------------------------
|(US$ thousands, except per share    | 2003                    
|amounts)                            |                         
|                                    |                         
|Oil and gas sales, net of royalties | 17,162                  
|                                    |                         
|Net income                          | 5,905                   
|Per share  basic                   | 0.11                    
|Per share  diluted                 | 0.11                    
|                                    |                         
|Cash flow from operations           | 9,347                   
|Per share  basic                   | 0.18                    
|Per share  diluted                 | 0.17                    
|                                    |                         
|Total Assets                        | 35,215                  
|                                    |                         
|Shareholders' Equity                | 30,603                  



The following is a summary of selected unaudited financial information of
  TransGlobe for the periods indicated.

|                                    | 2003                                      |  | 2002 
|----------------------------------- | ----------------------------------------- |  | -----
|                                    | Q4                                        |  | Q3   
|                                    | (US$ thousands, except per share amounts)
|Oil and gas sales, net of royalties | 4,488                                     |  | 4,159
|                                    |                                           |  |      
|Net income                          | 3,414                                     |  | 291  
|Per share  basic                   | 0.06                                      |  | 0.01 
|Per share  diluted                 | 0.06                                      |  | 0.01 
|                                    |                                           |  |      
|Cash flow from operations           | 1,894                                     |  | 2,193
|Per share  basic                   | 0.04                                      |  | 0.04 
|Per share  diluted                 | 0.04                                      |  | 0.04 

Capital Expenditures

The following table summarizes capital expenditures (net of
  incentives and net of certain proceeds and including capitalized general and
  administrative expenses) related to the Company's activities for the year ended
  December 31, 2003:

---

32

|                             | Canada |  | Yemen |  | Total 
|---------------------------- | ------ |  | ----- |  | ------
|(US$ thousands)              |        |  |       |  |       
|Property acquisition costs   |        |  |       |  |       
|Proved properties            | -      |  | -     |  | -     
|Undeveloped
      properties | 1,198  |  | -     |  | 1,198 
|Exploration costs            | 263    |  | 4,474 |  | 4,737 
|Development costs            | 3,123  |  | 3,857 |  | 6,980 
|Corporate and other          | 633    |  | 681   |  | 1,314 
|Total                        | 5,217  |  | 9,012 |  | 14,229

MANAGEMENT'S DISCUSSION AND ANALYSIS OF OPERATING RESULTS

The Company's management discussion and analysis relating
  to (i) the financial statements for the year ended December 31, 2003, which
  form part of the Company's 2003 Annual Report, (ii) the financial statements
  for the three months ended March 31, 2004, and (iii) the financial statements
  for the six months ended June 30, 2004, are incorporated herein by reference
  and form an integral part of this Annual Information Form.

DIVIDEND POLICY

The Company has not paid any dividends to date on its Common
  Shares. The board of directors of the Company will determine the timing, payment
  and amount of dividends, if any, that may be paid by the Company from time to
  time based upon, among other things, the cash flow, results of operations and
  financial condition of the Company, the need for funds to finance ongoing operations
  and other business considerations as the board of directors considers relevant.

MARKET FOR SECURITIES

TransGlobe's common shares are listed and posted on the Toronto
  Stock Exchange and the American Stock Exchange under the trading symbols "TGL"
  and "TGA", respectively.

DIRECTORS AND OFFICERS

The names, municipalities of residence, the offices held by
  each in the Company, and the principal occupation of the directors and officers,
  the period served as director and the number of securities of the Company owned
  by such individuals is as follows:

|                                       |  |                                                                      |  | Year Became |  | Number of    |  |                                                                                                                                                                                                          
|-------------------------------------- |  | -------------------------------------------------------------------- |  | ----------- |  | ------------ |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name and Municipality                  |  |                                                                      |  | Director or |  | Common       |  | Principal Occupation and Positions                                                                                                                                                                       
|of Residence                           |  | Position Held                                                        |  | Officer     |  | Shares Held  |  | for the Past Five Years                                                                                                                                                                                  
|                                       |  |                                                                      |  |             |  |              |  |                                                                                                                                                                                                          
|Robert A. Halpin (1)(2)(4) Calgary, AB |  | Chairman of the  
      Board and Director                           |  | 1997        |  | 527,585(5)   |  | Retired Petroleum Engineer, President
        and owner, Halpin Energy Resources Ltd., which provides consulting services
        on international energy projects                                       
|                                       |  |                                                                      |  |             |  |              |  |                                                                                                                                                                                                          
|Ross G. Clarkson(2) Calgary, AB        |  | President, Chief  
      Executive Officer  
      and Director      |  | 1995        |  | 1,994,272(6) |  | President and Chief Executive Officer
        of the Company since December 4, 1996, with over 28 years' oil and gas
        industry experience as a senior geological advisor                          
|                                       |  |                                                                      |  |             |  |              |  |                                                                                                                                                                                                          
|Lloyd W. Herrick (4) Calgary, AB       |  | Vice-President,  
      Chief Operating  
      Officer and Director |  | 1999        |  | 550,000(7)   |  | Vice-President and Chief Operating officer
        of the Company since April 28, 1999, with over 28 years' experience in
        both domestic and international oil and gas exploration and development

---

33

|                                        |  |                                                                                             |  | Year Became |  | Number of   |  |                                                                                                                                                                                                                                                                                                                                              
|--------------------------------------- |  | ------------------------------------------------------------------------------------------- |  | ----------- |  | ----------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name and Municipality                   |  |                                                                                             |  | Director or |  | Common      |  | Principal Occupation and Positions                                                                                                                                                                                                                                                                                                           
|of Residence                            |  | Position Held                                                                               |  | Officer     |  | Shares Held |  | for the Past Five Years                                                                                                                                                                                                                                                                                                                      
|                                        |  |                                                                                             |  |             |  |             |  |                                                                                                                                                                                                                                                                                                                                              
|Erwin L. Noyes (2)(3)(4) Saanichton, BC |  | Director                                                                                    |  | 1995        |  | 188,247(8)  |  | Retired since July 31, 2000,
        Vice-President, International Operations of the Company, with over 30
        years' experience in the oil and gas industry                                                                                                                                                                             
|                                        |  |                                                                                             |  |             |  |             |  |                                                                                                                                                                                                                                                                                                                                              
|Geoffrey C. Chase (1)(3)(4) Calgary, AB |  | Director                                                                                    |  | 2000        |  | 45,000(9)   |  | Retired Senior Vice-President,
        Business Development, with Ranger Oil, with over 35 years' experience
        in the oil and gas industry                                                                                                                                                                                             
|                                        |  |                                                                                             |  |             |  |             |  |                                                                                                                                                                                                                                                                                                                                              
|Fred J. Dyment (1)(2)(3) Calgary, AB    |  | Director                                                                                    |  | 2004        |  | -(10)       |  | Chartered accountant with
        over 30 years' experience in the oil and gas industry. Previously President
        and Chief Executive Officer, Maxx Petroleum Company (2000- 2001). Prior
        thereto Controller, Vice-President, Finance and then President and Chief
        Executive Officer of Ranger Oil Limited from 1978-2000
|                                        |  |                                                                                             |  |             |  |             |  |                                                                                                                                                                                                                                                                                                                                              
|David Ferguson  
      Calgary, AB      |  | Vice-President, 
        Finance, Chief  
        Financial Officer  
        and Secretary |  | 2001        |  | 119,000(11) |  | Chartered accountant with
        over 22 years' experience in the oil and gas industry. Previously Chief
        Financial Officer with Northstar Drilling Systems Inc. (1999-2000), Chief
        Financial Officer and a director of Myriad Energy Corporation (1998-1999).                                                               

Notes:

|(1)  | Members of the Company's Audit Committee.                                                                                                                                                                                                                                                                                             
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2)  | Members of the Company's Compensation Committee.                                                                                                                                                                                                                                                                                      
|(3)  | Members of the Company's Governance and Nominating
        Committee.                                                                                                                                                                                                                                                                 
|(4)  | Members of the Company's Reserves Committee                                                                                                                                                                                                                                                                                           
|(5)  | Mr. Halpin also holds incentive stock options to
        purchase 120,000 Common Shares at Cdn$0.50 per share expiring April 16,
        2007 and to purchase 80,000 Common Shares at Cdn$3.26 per share expiring
        March 15, 2009.                                                                                             
|(6)  | Mr. Clarkson also holds incentive stock options
        to purchase 154,500 Common Shares at Cdn$0.73 per share expiring August
        11, 2005, to purchase 250,000 Common Shares at Cdn$0.50 per share expiring
        April 16, 2007 and to purchase 120,000 Common Shares at Cdn$3.26 per share
        expiring March 15, 2009.
|(7)  | Mr. Herrick also holds incentive stock options to
        purchase 135,000 Common Shares at Cdn$0.73 per share expiring August 11,
        2005, to purchase 250,000 Common Shares at Cdn$0.50 per share expiring
        April 16, 2007 and to purchase 100,000 Common Shares at Cdn$3.26 per share
        expiring March 15, 2009. 
|(8)  | Mr. Noyes also holds incentive stock options to
        purchase 150,000 Common Shares at Cdn$0.73 per share expiring August 11,
        2005, to purchase 120,000 Common Shares at Cdn$0.50 per share expiring
        April 16, 2007 and to purchase 60,000 Common Shares at Cdn$3.26 per share
        expiring March 15, 2009.    
|(9)  | Mr. Chase also holds incentive stock options to
        purchase 140,000 Common Shares at Cdn$0.73 per share expiring August 11,
        2005, to purchase 120,000 Common Shares at Cdn$0.50 per share expiring
        April 16, 2007 and to purchase 60,000 Common Shares at Cdn$3.26 per share
        expiring March 15, 2009.    
|(10) | Mr. Dyment holds incentive stock options to purchase
        180,000 Common Shares at Cdn$3.26 per share expiring March 15, 2009.                                                                                                                                                                                                     
|(11) | Mr. Ferguson also holds incentive stock options
        to purchase 200,000 Common Shares at Cdn$0.55 per share expiring June
        1, 2006, to purchase 200,000 Common Shares at Cdn$0.50 per share expiring
        April 16, 2007 and to purchase 90,000 Common Shares at Cdn$3.26 per share
        expiring March 15, 2009.    

---

34

Corporate Cease Trade Orders or Bankruptcies

No director or officer or the Company or, to the Company's
  knowledge, a shareholder holding a sufficient number of securities of the Company
  to effect materially the control of the Company is, or within the 10 years before
  the date of this document has been, a director or officer of any other issuer
  that, while that person was acting in that capacity, was the subject of a cease
  trade or similar order or an order that denied the issuer access to any exemptions
  under Canadian securities legislation, for a period of more than 30 consecutive
  days, or became bankrupt, made a proposal under any legislation relating to
  bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement
  or compromise with creditors or had a receiver, receiver-manager or trustee
  appointed to hold its assets.

Penalties or Sanctions


No director or officer of the Company, or to the Company's
  knowledge, a shareholder holding a sufficient number of securities of the Company
  to effect materially the control of the Company has been subject to any penalties
  or sanctions imposed by a court relating to Canadian securities legislation
  or by a Canadian securities regulatory authority or has entered into a settlement
  agreement with a Canadian securities regulatory authority, or has been subject
  to any other penalties or sanctions imposed by a court or regulatory body that
  would likely be considered important to a reasonable investor in making an investment
  decision.

Personal Bankruptcies


No director or officer of the Company, or to the Company's
  knowledge, a shareholder holding sufficient securities of the Company to affect
  materially the control of the Company, or a personal holding company of any
  such persons, has, within the 10 years preceding the date of this document,
  become bankrupt, made a proposal under any legislation relating to bankruptcy
  or insolvency, or was subject to or instituted any proceedings, arrangement
  or compromise with creditors or had a receiver, receiver manager or trustee
  appointed to hold the assets of such director, officer or shareholder.

Conflicts of Interest

Directors and officers of the Company may, from time to time,
  be involved with the business and operations of other oil and gas issuers, in
  which case a conflict may arise. See "Risk Factors".

HUMAN RESOURCES

The Company currently employs 10 full-time employees and 3
  part-time consultants. The Company intends to add additional professional and
  administrative staff as the needs arise.

AUDITORS, TRANSFER AGENT AND REGISTRAR

The auditors of the Company are Deloitte & Touche LLP,
  Chartered Accountants, Suite 3000, 700  2nd Street SW, Calgary, Alberta
  T2P 0S7.

Computershare Trust Company of Canada, at its principal office
  in Calgary, Alberta is the transfer agent and registrar of the common shares
  of the Company.

RISK FACTORS

General Conditions Relating to Oil and Gas Exploration
  and Production Operations

The Company's operations are subject to all the risks normally
  incident to the exploration for and production of oil and gas including geological
  risks, operating risks, political risks, development risks, marketing risks,
  and logistical risks of operating in Yemen.

---

35

Industry Risks

The Company is subject to normal industry risks due to the
  relatively small size of the Company, its level of cash flow, and the nature
  of the Company's involvement in the exploration for, and the acquisition, development
  and production of, oil and natural gas. Exploration for oil and natural gas
  involves many risks, which even a combination of experience, knowledge and careful
  evaluation may not be able to overcome. There is no assurance that further commercial
  quantities of oil and natural gas will be discovered by the Company.

The Company's operations are subject to the risks normally
  incident to the operation and development of oil and natural gas properties
  and the drilling of oil and natural gas wells, including encountering unexpected
  formations or pressures, premature decline of reservoirs, invasion of water
  into producing formations, blow-outs, cratering, fires and oil spills, all of
  which could result in personal injuries, loss of life and damage to the property
  of the Company and others. Although the Company maintains insurance, in amounts
  and coverages which it considers adequate, in accordance with customary industry
  practice, the Company is not fully insured against all of these risks, nor are
  all such risks insurable, and, as a result, liability of the Company arising
  from these risks could have a material adverse effect upon its financial condition.

The operations and earnings of the Company may be affected
  from time to time in varying degrees by political developments and laws and
  regulations, such as forced divestiture of assets, restrictions on production,
  imports and exports; price controls, tax increases and retroactive tax claims,
  expropriations of property; and cancellation of contract rights. Both the likelihood
  of such occurrences and their overall effect upon the Company can vary greatly
  and are not predictable.

The marketability and price of oil and natural gas which may
  be acquired or discovered by the Company may be affected by numerous factors
  beyond the control of the Company. The Company may be affected by the differential
  between the price paid by refiners for light, quality oil and various grades
  of oil produced by the Company. The Company is subject to market fluctuations
  in the prices of oil and natural gas, deliverability uncertainties related to
  the proximity of its reserves to pipeline and processing facilities and extensive
  government regulation relating to prices, taxes, royalties, land tenure, allowable
  production, the export of oil and natural gas and many other aspects of the
  oil and natural gas business. The Company's operations will be further affected
  by the remoteness of, and restrictions on access to, certain properties as well
  as climatic conditions. The Company is also subject to compliance with federal,
  state and local laws and regulations controlling the discharge of materials
  into the environment or otherwise relating to the protection of the environment.
  The Company is not aware of present material liability related to environmental
  matters. However, it may, in the future, be subject to liability for environmental
  offences of which it is presently unaware. Additionally, the potential impact
  on the Company's operations and business of the Kyoto Protocol which has now
  been ratified by Canada, with respect to instituting reductions of greenhouse
  gases is difficult to quantify at this time as specific measures for meeting
  Canada's commitments have not been developed.

Exploration and Development

The Company's participation in Block 32 and Block S-1 in Yemen
  represents a major undertaking. The exploration program in Yemen is a high-risk
  venture with uncertain prospects for ongoing success.

The operations and earnings of the Company and its subsidiaries
  are also affected by local, regional and global events or conditions that affect
  supply and demand for oil and natural gas. These events or conditions are generally
  not predictable and include, among other things, the development of new supply
  sources; supply disruptions; weather; international political events; technological
  advances; and the competitiveness of alternative energy sources or product substitutes.

Competition


The Company encounters strong competition from other independent
  operators and from major oil companies in acquiring properties suitable for
  development, in contracting for drilling equipment and in securing trained personnel.
  Many of these competitors have financial resources and staffs substantially
  larger than those available to the Company. The availability of a ready market
  for oil and gas discovered by the Company depends on numerous factors beyond
  its control, including the extent of production and imports of oil and gas,
  the demand for its products

---

36

from Canada, the United States and Republic of Yemen, the
  proximity and capacity of natural gas pipelines and the effect of provincial,
  state or federal regulations.

Title to Properties


The Company's interests in the Canadian producing properties
  and non-producing properties are in the form of direct or indirect interests
  in leases. Such properties are subject to customary royalty interests generally
  contracted for in connection with the acquisition of properties, liens incident
  to operating agreements, liens for current taxes and other burdens and mineral
  encumbrances and restrictions. The Company believes that none of these burdens
  materially interferes with the use of such properties in the operation of the
  Company's business.

Interests in Properties


The Company participates, in Canada and Yemen, with industry
  partners with access to greater resources from which to meet their joint venture
  capital commitments. Should the Company be unable to meet its commitments, the
  joint venture partners may assume some or all of the Company's deficiency and
  thereby assume a pro-rata portion of the Company's interest in production from
  the joint venture lands. The Company is not a majority interest owner in all
  of its properties and does not have sole control over the future course of development
  in those properties.

Government Regulation


In the areas where the Company conducts activities there are
  statutory laws and regulations governing the activities of oil and gas companies.
  These laws and regulations allow administrative agencies to govern the activities
  of oil companies in the development, production and sale of both oil and gas.
  Changes in these laws and regulations may substantially increase or decrease
  the costs of conducting any exploration or development project. The Company
  believes that its operations comply with all applicable legislation and regulations
  and that the existence of such regulations have no more restrictive effect on
  the Company's method of operations than on similar companies in the industry.

Political Risks Relating to Yemen


Beyond the risks inherent in the oil and gas industry, the
  Company is subject to additional risks resulting from doing business in Yemen.
  While the Company has attempted to reduce many of these risks through agreements
  with the Government of Yemen and others, no assurance can be given that such
  risks have been mitigated. These risks can involve matters arising out of the
  evolving laws and policies of Yemen, the imposition of special taxes or similar
  charges, oil export or pipeline restrictions, foreign exchange fluctuations
  and currency controls, the unenforceability of contractual rights or the taking
  of property without fair compensation, restrictions on the use of expatriates
  in the operations and other matters.

There can be no assurance that the agreements entered into
  with the Government of Yemen and the MOM and others are enforceable or binding
  in accordance with TransGlobe's understanding of their terms or that if breached,
  the Company would be able to find a remedy. The Company bears the risk that
  a change of government could occur and a new government may void the agreements,
  laws and regulations that the Company is relying on. Operations in Yemen are
  subject to risks due to the harsh climate, difficult topography and the potential
  for social, political, economic, legal and financial instability.

Reliance Upon Officers

The Company is largely dependent upon the personal efforts
  and abilities of its corporate officers. The loss or unavailability to the Company
  of these individuals may have a material adverse effect upon the Company's business,
  especially in Yemen.

Multi-jurisdictional Legal Risks


The Company is incorporated under the laws of the Province
  of British Columbia, Canada, and all of the Company's directors and all of its
  officers are residents of Canada. Consequently, it may be difficult for United
  States investors to effect service of process within the United States upon
  the Company or upon those directors or officers, who are

---

37

not residents of the United States, or to realize in the United
  States upon judgements of United States courts predicated upon civil liabilities
  under the Securities Exchange Act of 1934, as amended (United States). Furthermore,
  it may be difficult for investors to enforce judgements of the U.S. courts based
  on civil liability provisions of the U.S. federal securities laws in a Canadian
  court against the Company or any of the Company's non-U.S. resident executive
  officers or directors. There is substantial doubt whether an original lawsuit
  could be brought successfully in Canada against any of such persons or the Company
  predicated solely upon such civil liabilities.

Reserve Information


The reserve and recovery information contained in the each
  of the OSA Report and the Fekete Report are only estimates and the actual production
  and ultimate reserves from the Company's properties may be greater or less than
  the estimates prepared in such reports. Each of the OSA Report and the Fekete
  Report have been prepared using certain commodity price assumptions which are
  described in the notes to the reserve tables. If lower prices for crude oil,
  natural gas liquids and natural gas are realized by the Company and substituted
  for the price assumptions utilized in the reports, the present value of estimated
  future net cash flows for the Company's reserves would be reduced and the reduction
  could be significant, particularly based on the constant price case assumptions.
  Exploration for oil and natural gas involves many risks, which even a combination
  of experience and careful evaluation may not be able to overcome. There is no
  assurance that further commercial quantities of oil and natural gas will be
  discovered by the Company.

Additional Financing Requirements


The future development of the Company's oil and natural gas
  properties may require additional financing and there are no assurances that
  such financing will be available or, if available, will be available upon acceptable
  terms.

Canadian Tax Considerations


As the Company is engaged in the oil and natural gas business
  its operations are subject to certain unique provisions of the Income Tax
  Act (Canada) and applicable provincial income tax legislation relating to
  characterization of costs incurred in their businesses which effects whether
  such costs are deductible and, if deductible, the rate at which they may deducted
  for the purposes of calculating taxable income. The Company has reviewed its
  historical income tax returns with respect to the characterization of the costs
  incurred in the oil and natural gas business as well as other matters generally
  applicable to all corporations including the ability to offset future income
  against prior year losses. The Company has filed or will file all required income
  tax returns and believes that it is full compliance with the provisions of the
  Income Tax Act (Canada) and applicable provincial income tax legislation,
  but such returns are subject to reassessment. In the event of a successful reassessment
  of the Company it may be subject to a higher than expected past or future income
  tax liability as well as potentially interest and penalties and such amount
  could be material.

Exchange Rate Risks

The Canadian to US dollar exchange rate has strengthened during
  2003 and may fluctuate over time. As product prices are generally US dollar
  based, the Company's exposure to currency exchange rate risks are primarily
  limited to Canadian capital expenditures, Canadian operating costs and the majority
  of the Company's G&A which are paid for in Canadian dollars.

Dividends


The Company does not anticipate paying any dividends on its
  outstanding shares in the foreseeable future.

Conflicts of Interest


The directors of the Company may be engaged and may continue
  to be engaged in the search for oil and gas interests on their own behalf and
  on behalf of other companies, and situations may arise where the directors may
  be in direct competition with the Company. Conflicts of interest, if any, which
  arise will be subject to and governed by procedures prescribed by the corporation's
  governing corporate law statute which require a director of a corporation who
  is a party to, or is a director or an officer of, or has some material interest
  in any person who is a party to, a

---

38

material contract or proposed material contract with the Company,
  disclose his or her interest and, in the case of directors, to refrain from
  voting on any matter in respect of such contract unless otherwise permitted
  under such legislation.

Reliance on Key Personnel


Holders of Common Shares of the Company must rely upon the
  experience and expertise of the management of the Company. The continued success
  of the Company is largely dependant on the performance of its key employees.
  Failure to retain or to attract and retain additional key employees with necessary
  skills could have a materially adverse impact upon the Company's growth and
  profitability.

Dilutive Effect of Financings and Acquisitions


TransGlobe may make future acquisitions or enter into financing
  or other transactions involving the issuance of securities of TransGlobe which
  may be dilutive.

INDUSTRY CONDITIONS

The oil and gas industry is subject to extensive controls
  and regulations imposed by various levels of government in both Canada and Yemen.
  Outlined below are some of the more significant aspects of the legislation,
  regulations and agreements governing the oil and gas industry in the jurisdictions
  in which the Company operates. All current legislation is a matter of public
  record and the Company is unable to predict what additional legislation or amendments
  may be enacted.

Government Regulation Generally

The oil and natural gas industry in each of Yemen and Canada
  is subject to extensive controls and regulations imposed by various levels of
  government. It is not expected that any of these controls or regulations will
  affect the operations of TransGlobe in a manner materially different than they
  would affect other oil and gas companies of similar size.

Pricing and Marketing - Oil


In Canada, producers of oil negotiate sales contracts directly
  with oil purchasers, with the result that the market determines the price of
  oil. The price depends in part on oil quality, prices of competing fuels, distance
  to market, the value of refined products and the supply/demand balance. Oil
  exports may be made pursuant to export contracts with terms not exceeding 1
  year in the case of light crude, and not exceeding 2 years in the case of heavy
  crude, provided that an order approving any such export has been obtained from
  the National Energy Board ("NEB"). Any oil export to be made pursuant to a contract
  of longer duration (to a maximum of 25 years) requires an exporter to obtain
  an export licence from the NEB and the issue of such a licence requires the
  approval of the Governor in Council.

In Yemen, producers of oil negotiate sales contracts directly
  with oil purchasers, with the result that the market determines the price of
  oil. The price depends in part on oil quality, prices of competing fuels, distance
  to market, the value of refined products and the supply/demand balance. Yemen
  is not currently a member of OPEC.

Pricing and Marketing - Natural Gas


In Canada, the price of natural gas sold in interprovincial
  and international trade is determined by negotiation between buyers and sellers.
  Natural gas exported from Canada is subject to regulation by the NEB and the
  Government of Canada. Exporters are free to negotiate prices and other terms
  with purchasers, provided that the export contracts must continue to meet certain
  criteria prescribed by the NEB and the Government of Canada. Natural gas exports
  for a term of less than 2 years or for a term of 2 to 20 years (in quantities
  of not more than 30,000m3/day), must be made pursuant to an NEB order. Any natural
  gas export to be made pursuant to a contract of longer duration (to a maximum
  of 25 years) or a larger quantity requires an exporter to obtain an export licence
  from the NEB and the issue of such a licence requires the approval of the Governor
  in Council.

---

39

The Company's principal oil and gas operations in Canada are
  located in the Province of Alberta. The government of Alberta regulates the
  volume of natural gas, which may be removed from those provinces for consumption
  elsewhere based on such factors as reserve availability, transportation arrangement
  and market considerations.

Pipeline Capacity


In Canada, although pipeline expansions are ongoing, the lack
  of firm pipeline capacity continues to affect the oil and natural gas industry
  and limit the ability to produce and to market natural gas production. The pro
  rating of capacity on the interprovincial pipeline systems also continues to
  affect the ability to export oil.

In Yemen, export oil pipelines are owned by the government
  of Yemen through cost recovery. Access to the export pipelines is negotiated
  with the government. Sufficient export capacity currently exists, however, industry
  and market conditions may affect export capacity in the future.

The North American Free Trade Agreement


On January 1, 1994, the North American Free Trade Agreement
  ("NAFTA") among the governments of Canada, the U.S. and Mexico became effective.
  NAFTA carries forward most of the material energy terms contained in the Canada-U.S.
  Free Trade Agreement. In the context of energy resources, Canada continues to
  remain free to determine whether exports to the U.S. or Mexico will be allowed
  provided that any export restrictions do not: (i) reduce the proportion of energy
  resource exported relative to domestic use (based upon the proportion prevailing
  in the most recent 36 month period), (ii) impose an export price higher than
  the domestic price, and (iii) disrupt normal channels of supply. All three countries
  are prohibited from imposing minimum export or import price requirements.

NAFTA contemplates the reduction of Mexican restrictive trade
  practices in the energy sector and prohibits discriminatory border restrictions
  and export taxes. The agreement also contemplates clearer disciplines on regulators
  to ensure fair implementation of any regulatory changes and to minimize disruption
  of contractual arrangements, which is important for Canadian natural gas exports.

Royalties and Incentives


In addition to federal regulation, each province has legislation
  and regulations which govern land tenure, royalties, production rates, environmental
  protection and other matters. The royalty regime is a significant factor in
  the profitability of oil and natural gas production. Royalties payable on production
  from lands other than Crown lands are determined by negotiations between the
  mineral owner and the lessee. Crown royalties are determined by government regulation
  and are generally calculated as a percentage of the value of the gross production,
  and the rate of royalties payable generally depends in part on prescribed reference
  prices, well productivity, geographical location, field discovery date and the
  type or quality of the petroleum product produced.

From time to time the governments of Canada and the province
  of Alberta have established incentive programs which have included royalty rate
  reductions, royalty holidays and tax credits for the purpose of encouraging
  natural gas exploration or enhanced planning projects.

In Alberta, the royalty reserved to the Crown is subject to
  various incentives, and varies between 15% and 30% in the case of new gas and
  between 15% and 35% in the case of old gas, depending upon the posted reference
  price each month. Royalties on propane, butane and ethane are constant at 30%.
  While royalties on pentane and pentanes plus are variable. Alberta Crown royalties
  on oil production are calculated on a sliding scale basis.

In Alberta, natural gas produced from qualifying intervals
  in eligible gas wells spudded or deepened to a depth below 8,200 feet is subject
  to a royalty exemption, with the amount of the exemption varying with depth
  of the well. Oil produced from qualifying new pools is eligible for a third
  tier oil royalty rate. In addition, there is a royalty reduction for approved
  horizontal well re-entries.

In Alberta, a producer of oil or natural gas is entitled to
  a credit against the royalties payable to the Crown by virtue of the Alberta
  royalty tax credit program. The Alberta royalty tax credit program is based
  on a price sensitive formula, and the Alberta royalty tax credit rate currently
  varies between 75% at prices of oil below $15.89 per Bbl and 25% at prices above
  $33.37 per Bbl. The Alberta royalty tax credit rate is applied to a maximum
  of $2,000,000

---

40

of Alberta Crown royalties payable for each producer or associated
  group of producers. Crown royalties on production from producing properties
  acquired from corporations claiming maximum entitlement to Alberta royalty tax
  credit will generally not be eligible for Alberta royalty tax credit. The rate
  is established quarterly based on the average "par price", as determined by
  Alberta Resource Development for the previous quarterly period.

In Yemen, the respective Production Sharing Agreements determine
  the production sharing splits for the oil produced within the respective areas.
  The Company's share of royalties and taxes are paid out of the government's
  share of production sharing oil.

Environmental Regulation


The oil and natural gas industry in both Yemen and Canada
  is currently subject to environmental regulation pursuant to existing federal,
  provincial and state legislation. Environmental legislation provides for restrictions
  and prohibitions on releases or emissions of various substances produced or
  utilized in association with certain oil and gas industry operations. In addition,
  legislation in Canada requires that well and facility sites be abandoned and
  reclaimed to the satisfaction of provincial authorities. A breach of such legislation
  may result in the imposition of fines and penalties.

The Company is committed to meeting its responsibilities to
  protect the environment wherever it operates and anticipates making increased,
  although not material, expenditures of both a capital and expense nature as
  a result of the increasingly stringent laws relating to the protection of the
  environment. The Company believes that it is in material compliance with environmental
  laws and regulations applicable as at the date hereof.

Kyoto Protocol


In December of 2002, Canada became a signatory to the Kyoto
  Protocol. The implementation of this plan has not been fully defined by the
  Federal Government. Until an implementation plan is developed, it is impossible
  to assess the impact on specific industries and individual businesses within
  an industry. It is generally believed that the oil and gas industry, as a major
  producer of carbon dioxide (as a necessary by-product and emission of hydrocarbon
  production), will bear a disproportionately large share of the anticipated cost
  of implementation.

ADDITIONAL INFORMATION

Additional information, including directors' and officers'
  remuneration and indebtedness, principal holders of the Company's securities,
  options to purchase securities and interests of insiders in material transactions,
  if applicable, is contained in the Company's Information Circular-Proxy Statement
  dated April 16, 2004 which relates to the Annual and Special Meeting of Shareholders
  to be held on May 26, 2004. Additional financial information is contained in
  (i) the consolidated financial statements of the Company for the year ended
  December 31, 2003 and the Management's Discussion and Analysis contained in
  the Company's 2003 Annual Report and (ii) the unaudited consolidated financial
  statements of the Company for the three months ended March 31, 2004, and the
  Management's Discussion and Analysis thereon.

The Company will provide to any person or corporation, upon
  request to the Company:

|(a) | when the securities of the Company are
        in the course of a distribution pursuant to a preliminary short form prospectus
        or a short form prospectus:
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    | (i)                                                                                                                                                               
|   
|    | (ii)                                                                                                                                                              

---

41

| | (iii) | one copy of the management information circular
        of the Company in respect of its most recent annual meeting of shareholders
        that involved the election of directors or one copy of any annual filing
        prepared in lieu of that circular, as appropriate.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|

|(b) | at any other time, a copy of the documents referred
        to in clauses (a)(i), (ii) or (iii) above, provided the Company may require
        a payment of a reasonable charge if the request is made by a person or
        Company who is not a security holder of the Company.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Additional copies of this Annual Information Form and the
  materials listed in the preceding paragraph are available on the foregoing basis
  and upon request by contacting the Company at its offices at Suite 2900, 330
   5th Avenue S.W., Calgary, Alberta T2P 0L4, or by phone at (403) 264-9888,
  fax at (403) 264-9898 or email at trglobe@trans-globe.com.

---

SCHEDULE "A" 
  REPORT ON RESERVES DATA

To the board of directors of TransGlobe Energy Corporation (the
  "Company"):

|1. | We have evaluated the Company's reserves data as
        at December 31, 2003. The reserves data consist of the following:
|-- | --------------------------------------------------------------------------------------------------------------------------
|  

|(a) | (i)  | proved and proved plus probable oil and gas reserves
        estimated using forecast prices and costs; and
|--- | ---- | -----------------------------------------------------------------------------------------------------------
|   
|    | (ii) | the related estimated future net revenue; and                                                              
|   
|(b) | (i)  | proved oil and gas reserves estimated using constant
        prices and costs; and                         
|   
|    | (ii) | the related estimated future net revenue.                                                                  
|   

|2. | The reserves data are the responsibility of the
        Company's management. Our responsibility is to express an opinion on the
        reserves data based on our evaluation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | We carried out our evaluation in accordance with
        standards set out in the Canadian Oil and Gas Evaluation Handbook (the
        "COGE Handbook") prepared jointly by the Society of Petroleum Evaluation
        Engineers (Calgary Chapter) and the Canadian Institute of Mining, Metallurgy
        & Petroleum (Petroleum Society).                                                                                                                                                                                                                                                                                                                                       
|  
|3. | Those standards require that we plan and perform
        an evaluation to obtain reasonable assurance as to whether the reserves
        data are free of material misstatement. An evaluation also includes assessing
        whether the reserves data are in accordance with principles and definitions
        presented in the COGE Handbook.                                                                                                                                                                                                                                                                                                                                   
|  
|4. | The following table sets forth the estimated future
        net revenue (before deduction of income taxes) attributed to proved plus
        probable reserves, estimated using forecast prices and costs and calculated
        using a discount rate of 10 percent, included in the reserves data of
        the Company evaluated by us for the year ended December 31, 2003, and
        identifies the respective portions thereof that we have audited, evaluated
        and reviewed and reported on to the Company's Board of Directors. The
        values contained in the following table are reported in $US using a conversion
        factor of 1.2965 Cdn/US dollars.
|  

|                                |  | Description |  | Location of |  | Net Present Value of Future Net Revenue 
|------------------------------- |  | ----------- |  | ----------- |  | ----------------------------------------
|                                |  | and         |  | Reserves    |  | (before income taxes, 10% discount rate)
|                                |  | Preparation |  | (County or  |  | (in millions of U.S. dollars)           
|Independent Qualified           |  | Date of     |  | Foreign     |  |                                         
|Reserves Evaluator or           |  | Evaluation  |  | Geographic  |  |                                         
|Auditor                         |  | Report      |  | Area)       |  | Audited                                 
|                                |  |             |  |             |  |                                         
|De Golyer MacNaughton Canada    |  | January 29, |  | Canada      |  | $-                                      
|Limited (formerly Outtrim Szabo |  | 2004        |  |             |  |                                         
|Associates Ltd.)                |  |             |  |             |  |                                         

|5. | In our opinion, the reserves data respectively evaluated
        by us have, in all material respects, been determined and are in accordance
        with the COGE Handbook. We express no opinion on the reserves data that
        we reviewed but did not audit or evaluate.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|6. | We have no responsibility to update our reports
        referred to in paragraph 4 for events and circumstances occurring after
        their respective preparation dates.                                                                                                    
|  
|7. | Because the reserves data are based on judgements
        regarding future events, actual results will vary and the variations may
        be material.                                                                                                                        

(signed) "De Golyer MacNaughton"

De Golyer MacNaughton Canada Limited (formerly Outtrim Szabo Associates Ltd.)
  
  Calgary, Alberta 
  May 14, 2004

---



May 14, 2004

|To: | The Board of Directors of TransGlobe Energy Corporation (the "Company")                                                 
|--- | ------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                         
|    |                                                                                                                         
|1.  | We have evaluated the Company's reserves data as at December 31, 2003.
      The reserves data consist of the following:
|   

|(a) | (i)  | pro ved and proved plus probable oil and gas reserves estimated as at
      December 31, 2003 using forecast prices and costs; and
|--- | ---- | ----------------------------------------------------------------------------------------------------------------------------------
|   
|    | (ii) | the related estimated future net revenue; and                                                                                     
|   
|(b) | (i)  | proved oil and gas reserves estimated as at December 31, 2003 using constant
      prices and costs; and                          
|   
|    | (ii) | the related estimated future net revenue.                                                                                         
|   

|2. | The reserves data are the responsibility of the
        Company's management. Our responsibility is to express an opinion on the
        reserves data based on our evaluation.                                                                                                                                                                                                                                                                                                                                                              
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | We carried out our evaluation in accordance with
        stan dards set out in the Canadian Oil and Gas Evaluation Handbook (the
        "COGE Handbook") prepared jointly by the Society of Petroleum Evaluation
        Engineers (Calgary Chapter) and the Canadian Institute of Mining, Metallurgy
        & Petroleum (Petroleum Society).                                                                                                                                                                                              
|  
|3. | Those standards require that we plan and perform
        an evaluation to obtain reasonable assurance as to whether the reserves
        data are free of material misstatement. An evaluation also includes assessing
        whether the reserves data are in accordance with principles and definitions
        presented in the COGE Handbook.                                                                                                                                                                                           
|  
|4. | The following table sets forth the estimated future
        net revenue (before deduction of income taxes) attributed to proved plus
        probable reserves, estimated using forecast prices and costs and calculated
        using a discount rate of 10 percent, included in the reserves data of
        TransGlobe Energy Corporation evaluated by us for the year ended December
        31, 2003, and identifies the respective portions thereof that we have
        evaluated and reported on to the Company's Board of Directors:

---

A-2

|Independent |                                  |             |  |   |                                                         |  |           |  |          |  |      
|----------- | -------------------------------- | ----------- |  | - | ------------------------------------------------------- |  | --------- |  | -------- |  | -----
|Qualified   | Description and                  |             |  |   | Net Present Value of Future Net Revenue
      (M$ U.S.)
|Reserves    | Preparation Date o f             | Location of |  |   | (before income taxes, 10% discount rate)               
|Evaluator   | Evaluation                       | Reserves    |  |   | Audited                                                 |  | Evaluated |  | Reviewed |  | Total
|            |                                  |             |  |   |                                                         |  |           |  |          |  |      
|Fekete      | "Evaluation of the Interests     | Republic of |  | $ | -                                                       |  | 10726     |  | -        |  | 10726
|Associates  | of TransGlobe Energy Corporation | Yemen       |  |   |                                                         |  |           |  |          |  |      
|Inc.        | Tasour Field, Howarime Block 32  |             |  |   |                                                         |  |           |  |          |  |      
|            | as at December 31, 2003"         |             |  |   |                                                         |  |           |  |          |  |      
|            | dated January 20, 2004           |             |  |   |                                                         |  |           |  |          |  |      
|            |                                  |             |  |   |                                                         |  |           |  |          |  |      
|Fekete      | "Evaluation of the Interests     | Republic of |  | $ | -                                                       |  | 6450      |  | -        |  | 6450 
|Associates  | of TransGlobe Energy Corporation | Yemen       |  |   |                                                         |  |           |  |          |  |      
|Inc.        | An Nagyah Field, Damis Block S-1 |             |  |   |                                                         |  |           |  |          |  |      
|            | as at December 31, 2003"         |             |  |   |                                                         |  |           |  |          |  |      
|            | dated January 20, 2004           |             |  |   |                                                         |  |           |  |          |  |      
|            |                                  |             |  |   |                                                         |  |           |  |          |  |      
|            | Total                            |             |  | $ | -                                                       |  | 17176     |  | -        |  | 17176



|5. | In our opinion, the reserves data respectively evaluated by us have,
      in all material respects, been determined and are in accordance with the
      COGE Handbook
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|6. | We have no responsibility to update our reports referred to in paragraph
      4 for events and circumstances occurring after their respective preparation
      dates.
|  
|7. | Because the reserves data are based on judgements regarding future events,
      actual results will vary and the variations may be material.                          

|Executed as to our report referred to above:     |                            
|------------------------------------------------ | ---------------------------
|                                                 |                            
|Fekete Associates Inc., Calgary, Alberta, Canada | (signed "Gary Metcalfe")   
|                                                 | Gary D. Metcalfe, P. Eng.  
|                                                 | Vice President, Evaluations
|                                                 |                            
|                                                 | May 14, 2004               
|                                                 | Date                       

---

SCHEDULE "B"

REPORT OF MANAGEMENT AND DIRECTORS
  
  ON RESERVES DATA AND OTHER INFORMATION

Management of TransGlobe Energy Corporation (the "Company")
  are responsible for the preparation and disclosure of information with respect
  to the Company's oil and gas activities in accordance with securities regulatory
  requirements. This information includes reserves data, which consist of the
  following:

|(a) | (i) | proved and proved plus probable oil and gas reserves estimated as at December
      31, 2003 using forecast prices and costs; and
|--- | --- | ---------------------------------------------------------------------------------------------------------------------------------
|   
|    | (i) | the related estimated future net revenue; and                                                                                    
|   
|(b) | (i) | proved oil and gas reserves estimated as at December 31, 2003 using constant
      prices and costs; and                         
|   
|    | (i) | the related estimated future net revenue.                                                                                        

Independent qualified reserves evaluators have evaluated the
  Company's reserves data. The reports of the independent qualified reserves evaluators
  are summarized in this Annual Information Form.

The Reserves Committee of the board of directors of the Company has

|(c) | reviewed the Company's procedures for providing
        information to the independent qualified reserves evaluators;                                                                                                             
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(d) | met with the independent qualified reserves evaluators
        to determine whether any restrictions affected the ability of each such
        independent qualified reserves evaluator to report without reservation;
        and
|   
|(e) | reviewed the reserves data with management and each
        independent qualified reserves evaluator.                                                                                                                             

The Reserves Committee of the board of directors has reviewed
  the Company's procedures for assembling and reporting other information associated
  with oil and gas activities and has reviewed that information with management.
  The board of directors has, on the recommendation of the Reserves Committee,
  approved

|(f) | the content and filing with securities regulatory
        authorities of the reserves data and other oil and gas information;
|--- | -----------------------------------------------------------------------------------------------------------------------------
|   
|(g) | the filing of the report of the independent qualified
        reserves evaluator on the reserves data; and                   
|   
|(h) | the content and filing of this report.                                                                                       

Because the reserves data are based on judgments regarding future events,
  actual results will vary and the variations may be material.

|(signed) "Ross Clarkson"                             | (signed) "Geoffrey Chase"                   
|---------------------------------------------------- | --------------------------------------------
|Ross Clarkson                                        | Geoffrey Chase                              
|President, Chief Executive Officer and Director      | Director and Chair of the Reserves Committee
|                                                     |                                             
|(signed) "Lloyd Herrick"                             |                                             
|Lloyd Herrick                                        |                                             
|Vice-President, Chief Operating Officer and Director |                                             
|                                                     |                                             
|                                                     |                                             
|May 14, 2004                                         |                                             

---