ULTRA PETROLEUM CORPORATION
GREEN RIVER BASIN PROPERTY DESCRIPTION

LOCATION GEOLOGIC SETTING HISTORY ECONOMICS POTENTIAL

At Year End 2003 Ultra owned approximately 178,000 gross (101,000 net) acres of leases in and around the prolific Jonah and Pinedale Anticline natural gas fields of the Greater Green River Basin in southwestern Wyoming. Ultra is the largest lease holder on the Pinedale Anticline and third largest operator in Jonah field. Ultra owns over a 50% working interest and operates over 60% of this acreage position. At year-end 2003 Ultra had 1.073 Tcfe of proved reserves in the Jonah and Pinedale fields. Ultra’s third-party reservoir engineering firm has identified an inventory of over 600 economic drilling locations, with average per location reserves over 7 Bcf. Proven plus Probable reserves (2P) for year end 2003 total 2.1 Tcfe.

LOCATION
Ultra Petroleum's acreage position sits in the middle of the emerging Lance and Mesaverde tight gas sand plays in southwestern Wyoming. The north end of the Pinedale Anticline is located a mile or so to the west of the town of Pinedale and extends south from there another 30 miles. The Jonah Field, the first major Lance accumulation developed in this area, is located to the west of and adjacent to the southernmost portion of the Pinedale Anticline. The Lance and Mesaverde fairway runs generally northwest to southeast between the Wind River Mountains and the LaBarge platform. Three gathering systems, four gas processing plants and four interstate pipelines provide growing takeaway capacity from the area. Additional infrastructure expansions are planned to accommodate the growing production from Ultra’s area.

GEOLOGIC SETTING
The Pinedale Anticline drilling program primarily targets the same upper cretaceous Lance formation that produces so prolifically at Jonah. This thick sequence of tight, overpressured, gas charged sands were deposited some 65 million years ago by a major braided river system, which drained across this area. The end result was the deposition of over 5,000 feet of Lance sediments in parts of the area. The thickest accumulations of potential pay sands underlie the Pinedale. The Lance formation is age equivalent to the Almond, Lewis and Lance sands found further to the southeast.

The Lance formation consists of a thick sequence of interbedded sand and shale with pay thickness reaching over 1,000 feet in some areas. This play is characterized as a Basin Center Tight Gas Sand. These types of plays are generally formed in the deep portions of sedimentary basins. The sands have porosity and permeability levels lower than normally associated with productive zones. Pressures from within the reservoir are greater than are normal due to the gas migrating into the reservoir rock from a rich hydrocarbon source bed at rates exceeding those at which the gas can escape.

Starting in 2001, Ultra and partners have drilled selective wells deeper to test the Mesaverde section which underlies the geologically similar Lance by 500-1000 feet. During 2003, Ultra drilled or participated in the drilling of 63 wells in Wyoming, with all but one of these testing parts or all of the Mesaverde section bringing the total number of successful Mesaverde tests to well over one hundred, and providing evidence that the Mesaverde should be productive across most of the Pinedale Anticline with average incremental recoveries on the order of 2 Bcfe per well.
Pinedale/Jonah Area

HISTORY
Beginning in 1939 with the drilling of the first well, the Pinedale Anticline underwent sporadic and largely unsuccessful exploratory activity until 1997. During those early years, many wells encountered gas shows and some were capable of producing gas at rates up to one million cubic feet per day, although most only produced a fraction of that amount. The limited economic success of these early wells was the result of both a poor understanding of the geology and ineffective completion technology. As a result, this area remained largely unnoticed until the success of Jonah Field to the south in 1995.

The Jonah Field, discovered in 1975 by Davis Oil, has been under aggressive development since 1995. In 1996 Ultra gained a foothold in this now prolific field and has since drilled 43 productive wells on the current 40-acre spacing. Jonah Field is now estimated to contain as much as 8 TCF of recoverable reserves given the development of the field on well spacing of as little as 5 acres in some area and 10 to 20 acres field wide. Work is ongoing to gain the regulatory approval of this increased density development, approval of which is expected in 2004. The field currently is producing approximately 750 MMcfe gas per day from over 500 producing wells.

Since 1997, Ultra has been acquiring leasehold interest on the Anticline and is now the largest interest owner in this prolific natural gas field. Nearly all of Ultra's currently prospective acreage is now held by production. In 1997, Ultra drilled the Mesa 15-8 well on the northern portion of the anticline. This well, along with several successes drilled the same year to the south by McMurry Oil marked the beginning of the current phase of successful development of the Pinedale Anticline field. The completion of the Pinedale EIS in mid 2000 cleared access for up to 900 (700 producing) surface locations and initiated full-scale development activity. As in Jonah, Pinedale is currently developed on 40-acre well spacing and may need to be in-filled on 20-acre spacing to permit efficient recovery of the resource. Ultra and partners are currently undertaking pilot projects to gather the data needed to determine appropriate field spacing.

Ultra has acquired over 350 square miles of modern 3-D seismic data covering the Pinedale Anticline from the Mesa area in the north to the Jonah field in the south, where 3-D seismic has been instrumental in this successful development. During 1999, Ultra and partners acquired a proprietary 3-D seismic survey on the northern portion of the anticline covering the Mesa area. During 2000, Ultra acquired a license to the Veritas-Pinedale 3-D data on the central portion of the anticline covering the New Fork and Warbonnet areas. In 2001, Ultra purchased a license to 100 square miles of the Jebco-West Pinedale 3-D survey covering the western flank of the Pinedale Anticline. The combination of these surveys has Ultra in the unique position of being the only operator with 3-D seismic coverage over the majority of the Anticline. Since beginning to use the 3D seismic in 2000 to guide all drilling activities, Ultra has drilled or participated in the drilling of 122 wells on the Pinedale Anticline through year-end 2003. All were successful in finding gas in the objective section but, three outside operated wells had to be plugged due to mechanical problems while drilling. Two of these have been successfully redrilled, and the third will likely be redrilled in the near future.

ECONOMICS
Ultra's well economics are robust, with the average 2003 well costing approximately $4.1 million to drill, case, complete and equip for average reserves of about 10 Bcfe. A $4.1 million Lance/Mesaverde well generates a 53% rate of return at $3.00 wellhead gas price and pays out in 1.9 years, and produces for an additional 38 plus years. At $4.00 gas the rate of return climbs to nearly 100%. Finding and development costs for all Pinedale wells average between $0.50 - $0.60 / Mcfe. Currently, cash operating costs at $3.00 gas are about $0.75 / Mcfe. With these economics, Ultra is uniquely positioned to generate earnings down to about $1.50 gas price.

POTENTIAL
With the knowledge and experience gained from its unrivaled acerage holdings across the entire Pinedale Anticline and in the Jonah field, Ultra is uniquely positioned continue to unlock the potential of the Lance and Mesaverde tight gas sand play. Ultra intends to leverage this advantage to capture incremental value from its acreage holdings in the play.

During 2003, Ultra received approval to drill pilot programs in several areas of the Pinedale Anticline to determine the feasibility of increasing well density (20-acre spacing). These pilot projects, if successful, could lead to the development of Pinedale on a tighter spacing than the current 40-acre which would result in significant additional reserves being recovered. Ultra's current reserve bookings on Pinedale are based on 40-acre well density and we believe that doubling the density to 20-acre could result in effectively doubling the reserves recoverable from this highly prolific natural gas field. In the Jonah field, the largest operator is currently drilling pilot programs to test 10 and 5-acre spacing, having already drilled adequate 20-acre pilot wells to support at least that spacing. In an earlier ruling, the Wyoming Oil & Gas Conservation Commission determined that the Lance/Mesaverde reservoirs at Jonah and Pinedale Anticline are essentially the same and thus appropriate spacing at Jonah and Pinedale would likely be the same.

At year-end 2003 Ultra's third party reservoir engineering firm, Netherland Sewell & Associates, Inc. had identified potential reserves on Ultra's leasehold on the Pinedale anticline covering a total of 636 40-acre locations (25,440 gross acres). These 636 locations averaged 7.4 BCF for a total identified potential on Ultra interest acreage at year end 2003 of 4.7 TCF. This total potential, which has increased five-fold over the last five years, still does not include significant contribution from the Mesaverde or any contribution from potential increased density. Additionally, using it's seismic and knowledge base Ultra continues to evaluate a number of additional high potential play areas and concepts on its Green River Basin acreage position. Even without these other opportunities, Ultra has already identified over a decade of high rates of return drilling opportunities to fuel its growth in both reserves and production. These available locations provide the company with the ability to continue to meet the goal of significantly growing the companies reserve base for many years to come.

Pinedale EUR Map
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