EQUAL ENERGY (EQU)

[Timothy Smith]

Equal seeks to manage the risk to shareholders by following a number of operating principles which are intended to maximize flexibility and the ability to capitalize on opportunities. These operating principles include:

concentrating on geographic and play focus to ensure optimal execution;

maintaining a reasonable balance between dividend return and production growth to enhance shareholder value;

seeking high working interests, operatorship and ownership of associated infrastructure, so that Equal is better able to control the pace and timing of capital expenditures;

maintaining a multi-year inventory of lower-risk development projects so that Equal can fulfill its strategy of reinvesting in organic growth opportunities and sustain its dividend distributions; and

hedging commodity prices at attractive levels to ensure adequate cash flows are realized to carry out its planned capital programs and dividend distributions.