U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



FORM 40-F



(Check One)



 ̈Registration statement pursuant to Section 12 of the Securities Exchange Act of 1934



or



x Annual report
pursuant to section 13(a) or 15(d) of the Securities Exchange Act of 1934



For the fiscal year ended December 31, 2011



Commission file number 0-52083



PERPETUAL
ENERGY INC.



(Exact name of registrant as specified
in its charter)



|Alberta, Canada(Province or other jurisdiction of
    incorporation or organization) | 1311(Primary Standard Industrial
    Classification Code Number (if
    applicable)) | Not applicable(I.R.S. Employer
    Identification Number (if Applicable))
|------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------ | -------------------------------------------------------------------------



3200, 605 – 5TH Avenue,
S.W., Calgary, Alberta, Canada T2P 3H5
(403) 269-4400 (Address and Telephone Number of Registrant’s Principal Executive Offices)



DL Services
Inc., 1420 Fifth Avenue, Suite 3400, Seattle, WA 98101
(206) 903-5448(Name, Address (Including Zip Code) and Telephone Number
(Including Area Code) of Agent for Service in the United States)



Securities registered or to be registered
pursuant to Section 12(b) of the Act.





|Title
    of each class | Name
    of each exchange on which registered
|----------------------- | ---------------------------------------------





Securities registered or to be registered
pursuant to Section 12(g) of the Act: Common Shares



Securities for which there is a reporting
obligation pursuant to Section 15(d) of the Act: None



For annual reports, indicate by check mark
the information filed with this Form:





|xAnnual Information Form | xAudited Annual Financial Statements
|------------------------ | ------------------------------------







Indicate the number of outstanding shares
of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: 149,966,260
common shares



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



Yes x         No
 ̈



Indicate by check mark whether the registrant
has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted
and posted pursuant to Rule 405 of Regulation S-T (s.232.405 of this chapter) during the preceding 12 months (or for such shorter
period that the Registrant was required to submit and post such files).



Yes  ̈No
 ̈













FORM
40-F



Principal Documents



The following documents, filed as Exhibits
99.1, 99.2, and 99.3 to this Annual Report on Form 40-F, are hereby incorporated by reference into this Annual Report on Form
40-F:



| | (a) | Annual Information Form for the fiscal year ended December
                                                               31, 2011;
| | --- | -----------------------------------------------------------------------------------------------------------------------------------



| | (b) | Management’s Discussion and Analysis of Financial Condition
                                                               and Results of Operations for the fiscal year ended December 31,
                                                               2011; and
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | Consolidated Financial Statements for the fiscal year ended
                                                               December 31, 2011, prepared in accordance with International Financial
                                                               Reporting Standards as issued by the International Accounting Standards
                                                               Board.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------













ADDITIONAL DISCLOSURE



Certifications and Disclosure Regarding Controls and Procedures.



| | (a) | Certifications. See Exhibits
                                                           99.4, 99.5, 99.6 and 99.7 to this Annual Report on Form 40-F.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | Disclosure
                                                           Controls and Procedures. As of the end of Perpetual Energy Inc.’s
                                                           (“Perpetual”) fiscal year ended December 31, 2011, an evaluation
                                                           of the effectiveness of Perpetual’s “disclosure controls
                                                           and procedures” (as such term is defined in Rules 13a-15(e) and
                                                           15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange
                                                           Act”)) was carried out by the management of Perpetual, under
                                                           the supervision and with the participation of its President andChief
                                                           Executive Officer (“CEO”) and the Vice President, Finance
                                                           and Chief Financial Officer (“CFO”). Based
                                                           upon that evaluation, the CEO and CFO have concluded that as of the
                                                           end of that fiscal year, Perpetual’s disclosure controls and
                                                           procedures are effective to ensure that information required to be
                                                           disclosed by Perpetual in reports that it files or submits under the
                                                           Exchange Act is (i) recorded, processed, summarized and reported within
                                                           the time periods specified in Securities and Exchange Commission (the
                                                           “Commission”) rules and forms and (ii) accumulated and
                                                           communicated to Perpetual’s management, including its principal
                                                           executive officer and principal financial officer, to allow timely
                                                           decisions regarding required disclosure.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



It should be noted that while
the CEO and CFO believe that Perpetual’s disclosure controls and procedures provide a reasonable level of assurance that
they are effective, they do not expect that Perpetual’s disclosure controls and procedures or internal control over financial
reporting will prevent all errors and fraud. A control system, no matter how well conceived or operated, can provide only reasonable,
not absolute, assurance that the objectives of the control system are met.



| | (c) | Management’s
                                                                                             Annual Report on Internal Control
                                                                                             Over Financial Reporting.The
                                                                                             required disclosure is included in
                                                                                             the “Management’s Report”
                                                                                             that accompanies Perpetual’s
                                                                                             Consolidated Financial Statements
                                                                                             for the fiscal year ended December
                                                                                             31, 2011, filed as Exhibit 99.3 to
                                                                                             this Annual Report on Form 40-F.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (d) | Attestation
                                                                                             Report of the Registered Public Accounting
                                                                                             Firm.The required disclosure
                                                                                             is included in the “Report
                                                                                             of Independent Registered Public
                                                                                             Accounting Firm” that accompanies
                                                                                             Perpetual’s Consolidated Financial
                                                                                             Statements for the fiscal year ended
                                                                                             December 31, 2011, filed as Exhibit
                                                                                             99.3 to this Annual Report on Form
                                                                                             40-F.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (e) | Changes in Internal Control Over
                                                           Financial Reporting. During the fiscal year ended December 31,
                                                           2011, there were no changes in Perpetual’s internal control over
                                                           financial reporting that have materially affected, or are reasonably
                                                           likely to materially affect, Perpetual’s internal control over
                                                           financial reporting.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------













Notices Pursuant to Regulation BTR.



None.



Audit Committee Financial Expert.



The board of directors of Perpetual has
determined that Mr. Robert A. Maitland, the chair of the audit committee, qualifies as an “audit committee financial expert”
(as such term is defined in Form 40-F), and has determined that Mr. Maitland satisfies the specified criteria for being “independent”
under the rules of the New York Stock Exchange. Additionally, Mr. Maitland would be considered “independent” within
the meaning set out in Canadian securities legislation, specifically Multilateral Instrument 52-110 Audit Committees, and he would
be considered an independent director within the meaning set out in Rule 10A-3(b) under the Exchange Act. Mr. Maitland’s
background and experience is set out in Perpetual’s Annual Information Form for the fiscal year ended December 31, 2011,
filed as Exhibit 99.1 to this Annual Report on Form 40-F.



Code of Business Conduct.



Perpetual has adopted a code of ethics,
referred to as the Code of Business Conduct, that constitutes a “code of ethics” as defined in Form 40-F, and that
applies to all directors, officers, employees and consultants of Perpetual.



The Code of Business Conduct is available
for viewing on Perpetual’s website at www.perpetualenergy.com.



Since the adoption of the Code of Business
Conduct there have not been any waivers, including implicit waivers, granted from any provision of the Code of Business Conduct.



Principal Accountant Fees
and Services.



The following table sets forth information
about the fees billed to Perpetual and its predecessor, Paramount Energy Trust, for professional services provided by KPMG LLP
during fiscal 2011 and 2010:



|(CDN$)             |  | 2011 |         |  | 2010 | 
|------------------ |  | ---- | ------- |  | ---- | 
|Audit Fees         |  |      | 930,000 |  |      | 
|Audit-Related Fees |  |      | 0       |  |      | 
|Tax Fees           |  |      | 0       |  |      | 
|All Other Fees     |  |      | 0       |  |      | 
|Total              |  |      | 930,000 |  |      | 





Audit Fees. Audit fees consist
of fees for audit services work, which included fees relating to offering documents, International Financial Reporting Standards
conversion work, the integrated audit of Perpetual’s annual financial statements and internal controls, reviews of quarterly
financial statements, and services that are normally provided in connection with statutory and regulatory filings or engagements.















Audit-Related Fees. Audit-related
fees consist of fees for assurance and related services that are reasonably related to the performance of the audit or review
of Perpetual’s financial statements and are not reported as Audit Fees.



Tax Fees. Tax fees consist of fees
for tax compliance services, tax advice and tax planning. During fiscal 2010, the services provided in this category included
assistance and advice in relation to certain tax elections filed for a wholly-owned subsidiary of Perpetual; the review of trust
and corporate income tax returns; compliance advice respecting taxation in foreign jurisdictions; and compliance advice respecting
changes to the current corporate structure.



Other Fees. Other fees consist
of fees for French translation and valuation services.



Pre-Approval Policies and Procedures.



| | (a) | Perpetual’s audit committee has
                                                           adopted policies and procedures with respect to the pre-approval of
                                                           audit and permitted non-audit services to be provided by its principal
                                                           accountant, KPMG LLP. The policies and procedures sufficiently detail
                                                           the particular services to be provided to ensure that (i) the audit
                                                           committee knows precisely what services it is being asked to pre-approve
                                                           and (ii) it is not necessary for any member of management to make a
                                                           judgment as to whether a proposed service fits within the pre-approved
                                                           services.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The audit committee must pre-approve
the provision of permitted services by its principal accountant which are outside of the pre-approved policies and procedures
discussed above, including the fees and terms of the proposed services. Prohibited services may not be pre-approved by the audit
committee.



| | (b) | Of the fees reported in this Annual
                                                           Report on Form 40-F under the heading “Principal Accountant Fees
                                                           and Services”, none of the fees billed by KPMG LLP were approved
                                                           by Perpetual’s audit committee pursuant to the de minimusexception provided by Section (c)(7)(i)(C) of Rule 2-01 of Regulation
                                                           S-X.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Off-Balance Sheet Arrangements.



Perpetual does not have any off-balance
sheet arrangements that have, or are reasonably likely to have, a current or future effect on Perpetual’s financial condition,
changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources
that is material to investors. For a discussion of Perpetual's derivative arrangements and commitments, please read notes 17 and
18 to the Perpetual’s Consolidated Financial Statements for the year ended December 31, 2011, filed as Exhibit 99.3 to this
Annual Report on Form 40-F.













Tabular Disclosure of Contractual
Obligations.





|                                    |  | Payments due by period |      
|----------------------------------- |  | ---------------------- | -----
|Contractual obligations ($millions) |  | Total                  |      
|Long term bank debt (1)             |  |                        | 130.1
|Convertible debentures, principal   |  |                        | 234.9
|Senior notes, principal             |  |                        | 150.0
|Operating leases (3)                |  |                        | 12.6 
|Pipeline commitments (2)            |  |                        | 16.1 
|Total contractual obligations       |  |                        | 543.7



| | (1) | The
                                                                                                                                           revolving
                                                                                                                                           feature
                                                                                                                                           of
                                                                                                                                           Perpetual’s
                                                                                                                                           credit
                                                                                                                                           facility
                                                                                                                                           expires
                                                                                                                                           on
                                                                                                                                           May
                                                                                                                                           29,
                                                                                                                                           2012
                                                                                                                                           if
                                                                                                                                           not
                                                                                                                                           extended. 
                                                                                                                                           Upon
                                                                                                                                           expiry
                                                                                                                                           of
                                                                                                                                           the
                                                                                                                                           revolving
                                                                                                                                           feature
                                                                                                                                           of
                                                                                                                                           the
                                                                                                                                           facility,
                                                                                                                                           should
                                                                                                                                           it
                                                                                                                                           not
                                                                                                                                           be
                                                                                                                                           extended,
                                                                                                                                           amounts
                                                                                                                                           outstanding
                                                                                                                                           as
                                                                                                                                           of
                                                                                                                                           the
                                                                                                                                           expiry
                                                                                                                                           date
                                                                                                                                           will
                                                                                                                                           have
                                                                                                                                           a
                                                                                                                                           term
                                                                                                                                           to
                                                                                                                                           maturity
                                                                                                                                           date
                                                                                                                                           of
                                                                                                                                           one
                                                                                                                                           additional
                                                                                                                                           year.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | The Corporation has
                                                                           long-term commitments to pay for gas transportation
                                                                           on certain major pipeline systems in western Canada.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | Perpetual has office
                                                                           leases on its current office space ending on March
                                                                           31, 2018. Office lease commitments are shown net of
                                                                           related sublease recoveries.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|Interest payments on financial liabilities
    ($millions) |  | Total |       |  | 2012 |  |      | 2013 |  |  | 2014-2016 |  |  | Thereafter |     
|---------------------------------------------------------- |  | ----- | ----- |  | ---- |  | ---- | ---- |  |  | --------- |  |  | ---------- | ----
|Long term bank debt (1)                                    |  |       | 10.1  |  |      |  | 7.1  |      |  |  | 3.0       |  |  |            | -   
|Convertible debentures (2)                                 |  |       | 41.6  |  |      |  | 13.9 |      |  |  | 11.4      |  |  |            | 16.3
|Senior notes                                               |  |       | 81.4  |  |      |  | 13.1 |      |  |  | 13.1      |  |  |            | 39.4
|Total                                                      |  |       | 133.1 |  |      |  | 34.1 |      |  |  | 27.5      |  |  |            | 55.7



| | (1) | Assuming revolving feature of the credit facility
                                                                           is not extended and calculated at the December 31,
                                                                           2011 effective interest rate of 5.5% and assuming a
                                                                           constant debt level equivalent to the balance at December
                                                                           31, 2011.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | Assuming payment of interest is not settled in
                                                                           common shares, at the option of Perpetual.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------





UNDERTAKING AND CONSENT TO SERVICE OF
PROCESS



| | A. | Undertaking.
| | -- | ------------



Perpetual undertakes
to make available, in person or by telephone, representatives to respond to inquiries made by the Securities and Exchange Commission
(the “Commission”) staff, and to furnish promptly, when requested to do so by the Commission staff, information relating
to: the securities registered pursuant to Form 40-F; the securities in relation to which the obligation to file an annual report
on Form 40-F arises; or transactions in said securities.



| | B. | Consent to Service of Process.
| | -- | ------------------------------



Perpetual has filed a Form F-X in connection
with the class of securities in relation to which the obligation to file this report arises.



Any change to the
name or address of the agent for service of process of Perpetual shall be communicated promptly to the Commission by an amendment
to the Form F-X referencing the file number of the relevant registration statement.















SIGNATURES



Pursuant to the requirements
of the Exchange Act, Perpetual Energy Inc. certifies that it meets all of the requirements for filing on Form 40-F and has duly
caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized, on March 12, 2012.



| | PERPETUAL ENERGY INC.
| | ---------------------
| |                      
| | /s/                  
| | Name:                
| | Title:               

















EXHIBIT INDEX





|Exhibit |  | Description                                                                                                                          
|------- |  | -------------------------------------------------------------------------------------------------------------------------------------
|        |  |                                                                                                                                      
|99.1    |  | Annual Information Form for the fiscal year ended December 31, 2011                                                                  
|        |  |                                                                                                                                      
|99.2    |  | Management’s Discussion and Analysis of Financial Condition and Results of Operations for
    the fiscal year ended December 31, 2011
|        |  |                                                                                                                                      
|99.3    |  | Consolidated Financial Statements for the fiscal year ended December 31, 2011                                                        
|        |  |                                                                                                                                      
|99.4    |  | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14 of the Securities
    Exchange Act of 1934             
|        |  |                                                                                                                                      
|99.5    |  | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14 of the Securities
    Exchange Act of 1934             
|        |  |                                                                                                                                      
|99.6    |  | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350                                                          
|        |  |                                                                                                                                      
|99.7    |  | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350                                                          
|        |  |                                                                                                                                      
|99.8    |  | Consent of KPMG LLP                                                                                                                  
|        |  |                                                                                                                                      
|99.9    |  | Consent of McDaniel & Associates Consultants Ltd.