Unconventional Natural Gas

1. Unconventional Natural Gas A Compelling Case. A Clear Vision. August 2006 SPI

2. DISCLOSURE STATEMENT The corporate information contained in this presentation contains forward-looking forecast information. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonably accurate by Canadian Spirit Resources Inc. (CSRI) at the time of preparation, may prove to be incorrect. The actual results achieved during the forecast period will vary from the information provided herein and the variations may be material. Consequently, there is no representation by CSRI that actual results achieved during the forecast period will be the same in whole or in part as those forecast.

3. Overview • Unconventional natural gas: One of the fastest-growing sectors of North America's energy industry • Canadian Spirit Resources: Focused on developing 1.0 tcf of unconventional natural gas from coal (NGC) • A huge resource play: Farrell Creek, northeast British Columbia, 40,000 + acres, 94% (average) owned by CSRI, 80% of land includes deep rights, $30 million invested to date

4. Seven test holes drilled and cased Two holes fracture-stimulated in the Gething Formation Both holes producing natural gas and water Dedicated a test hole to evaluate gas-bearing shales Current Status

5. Resource Potential: Farrell Creek Sproule Associates Limited Preliminary Report April 17, 2006: Contingent gas-in-place resource potential • Gething coals 12 – 16 bcf per section • Gething shales 11 – 17 bcf per section • Gates & Moosebar shales 7 – 8 bcf per section

6. Measure production rates Develop pilot plan to drill and complete more test holes Focus on engineering, operational and marketing aspects of developing a commercial project Next Steps

7. Fast Facts (As at June 5, 2006) ($ Cdn) Shares outstanding 28.8 million Recent share price $2.25 Market cap $65 + million Land 62 + sections (42,000 gross acres) Contingent resource * Gething coals 12 – 16 bcf/section Gething shales 11 – 17 bcf/section Total contingent resource* 1.4 – 2.0 tcf Estimated recovery rate 60% Market cap / recoverable mcf $0.06 per mcf Largest shareholder Sprott Asset Management (18.8%) * (Sproule Associates, Apr 17/06, Gething Formation only, Farrell Creek, B.C.)

8. Natural Gas from Coal (NGC) • U.S. 10 years ahead of Canada • Industry in Western Canada growing rapidly • Production of unconventional gas similar to production of conventional gas • Typically, to economically produce natural gas from coal, formation water must be removed first

9. A Compelling Case NGC compared to conventional gas • Coal can store up to 6 or 7 times more gas • NGC well can have 3 times the life • NGC recovery factors can be as high as 80%

10. CSRI focused on unconventional gas, including NGC 2002 regional NGC assessment of WCSB Five-year plan: explore for and develop 1.0 tcf of NGC within five years in an environmentally safe and responsible manner A Clear Vision

11. Within four years: Identified several large resource plays Assembled high working interest land position in northeast B.C. Began evaluating productive capability of principal resource property A Clear Vision (cont’d)

12. Coalbed Gas Potential in B.C. CSRI area of interest

13. Farrell Creek, NE B.C. CSRI Test Area

14. Farrell Creek Geology

15. Gething Formation Multiple thin coal seams As many as 30 individual seams Net coal thickness: 25 – 50 feet Gas content: 230 – 550 scf/ton Contingent resource Coals 12 – 16 bcf/section Shales 11 – 17 bcf/section Resource Overview

16. Moosebar/Gates(Shale Formation) Gas content 2.5 – 11 scf/ton Thickness 900 feet Cored 600+ feet Additional prospects identified Bluesky, Cadomin, Halfway, Baldonnel, Doig/Montney Contingent resource Shales 7 – 8 bcf/section Resource Overview

17. Farrell Creek Potential Land 62 + sections Well spacing 4 – 8 wells per section Risked well locations 200 – 400 Productivity per well 250 – 300 mcf/d Potential production 50 – 120 mmcf/d

18. Farrell Creek 2006 Plan of Activities • License 2 – 4 additional locations for summer drilling program • Prepare and submit Feasibility Plan for provincial government approval • Raise funds for pilot phase of production • Drill, complete and test up to 4 additional wells • Initiate application to tie-in to Duke Energy pipeline

19. First Half (approved) $3.6 Second Half (estimated) 9.0 $12.6 G & A expense $1.4 Net cash resources (Jan 1/06) $8.0 2006 Capital Program ($ million Cdn)

20. Farrell Creek productivity Equipment and service costs Commodity prices Risks

21. Strategic Advantages • Resource knowledge and expertise of technical team • Energy development experience of management and directors • High working interest land position with multiple prospective targets

22. In Summary • Material land base of 62 + sections • 1.4 – 2.0 tcf (coals and shales, Gething only) • Value/Market upside • Additional potential (shallow and deep) • Favorable commodity pricing • 200 mmcf/d capacity in nearby Duke Energy pipeline

23. A Compelling Case. A Clear Vision. A company with its eye on the prize: 1.0 tcf of NGC

24. Canadian Spirit Resources Inc. Suite 1950, Ford Tower 633 6th Avenue S.W. Calgary, Alberta T2P 2Y5 Telephone (403) 539-5005 E-mail: info@csri.ca TSX Venture: SPI w w w . c s r i . c a