Subject: New Alberta Fernie Formation Black Shale Natural Gas Play

Thursday October 8, 2009, Steven Schurman, CEO, US Prof. Geologist, Director, reports:

Further to the Company's news release of July 30, 2009, a new black shale, natural gas production opportunity appears to be developing in southwest Alberta where Running Fox has an interest in the 28 square mile Pincher Creek Natural Gas Project. Similar to many sedimentary basins in the United States with black shale that are currently experiencing extensive exploration drilling for natural gas, it has been recognized that the Jurassic-age Fernie Group in Alberta also contains thick sequences of highly organic, shale, natural gas source rock.

Since 2005, Running Fox has participated in the development of the Pincher Creek project and since that time has been producing natural gas and condensates. Over the years, the Pincher Creek project has yielded average revenue of $1 million per year to Running Fox's interest from a conventional gas zone in the Livingston Formation.

As with the U.S. black shale projects, the Fernie Group shale in Alberta is not only the source of the natural gas but also acts as the reservoir rock for the natural gas. The presence of natural gas in shale formations has been known for many years but only in the past decade have gas well completion techniques been developed that can successfully recover the natural gas from "tight" shale formations in commercial quantities.

Shales are tight, and gas typically flows through fractures, and additional manmade frac operations can open new fractures in some cases over 2,000 ft from the well bore, as noted by global oilfield services giant Schlumberger Ltd. Some new technological advances for shale development are:

* 3-D seismic in determining lateral length and placement;

* Multilaterals (drilling several laterals from a single well pad);

* Multiple frac stages within a lateral;

* Real-time microseismic monitoring to image hydraulic-fracture treatments;

* Simul-fracs (simultaneous hydraulic fracturing of offset parallel horizontal wells about 1,000 feet apart);

* Seismic technology is playing an increasing role in shale gas appraisal and development. Generally, the industry has been driven by technological advances in horizontal drilling and fracture stimulation techniques. In the U.S., some of the best known black shale natural gas producing formations include the Barnett Shale, New Albany and Bakken formations where gas resources can be up to 100 Bcf per section.