Paramount Energy Trust Confirms September 2007 Distribution and Announces Appointment of Vice President, Geoscience and New Ventures



    CALGARY, Sept. 11 /CNW/ - Paramount Energy Trust (TSX:PMT.UN) ("PET" or
the "Trust") confirmed today that its distribution to be paid on October 15,
2007 in respect of income received by PET for the month of September 2007, for
Unitholders of record on September 28, 2007, will be $0.10 per Trust Unit. The
ex-distribution date is September 26, 2007. The September 2007 distribution
brings cumulative distributions paid since the inception of the Trust in
February 2003 to $11.624 per Trust Unit.
    Natural gas prices weakened dramatically late in the second quarter of
2007 as a result of the combination of increased storage inventories resulting
from high liquefied natural gas imports into the United States and relatively
mild early summer weather. While late summer cooling demand has reduced the
year over year surplus gas in storage somewhat, PET continues to remain
cautious in its outlook with respect to near term natural gas prices. The
Trust continues to firmly focus on what we believe is a sustainable
distribution model that balances short term cash returns to our Unitholders
and long term value creation through capital spending programs.
    PET continues to actively manage its risk management program. PET has
significantly increased its hedging positions since last reported in early
August. Financial and physical forward sales arrangements at the AECO and
NYMEX trading hubs as at September 11, 2007 are as follows:

    
                       Volumes at                 Current
                          AECO (2)   Price        Forward
    Type of contract        (GJ/d)   ($/GJ)     Price ($/GJ)           Term
    -------------------------------------------------------------------------
    Financial              87,500     5.86                      October 2007
    Physical                5,000     5.85                      October 2007
    -------------------------------------------------------------------------
    Period total, net (1)  92,500     5.86         4.99         October 2007
    -------------------------------------------------------------------------
    Financial NYMEX         7,500     5.77 US$                  October 2007
    -------------------------------------------------------------------------
    Period total, net (1)   7,500     5.77 US$     5.93 US$     October 2007
    -------------------------------------------------------------------------
    Financial              67,500     7.39                     November 2007
                                                                - March 2008
    Physical               10,500     7.43                     November 2007
                                                                - March 2008
    -------------------------------------------------------------------------
    Period total, net (1)  78,000     7.40         6.46        November 2007
                                                                - March 2008
    -------------------------------------------------------------------------
                                                                - March 2008
    Financial              55,000     7.40                     April -
                                                                October 2008
    Physical                5,000     6.68                     April -
                                                                October 2008
    -------------------------------------------------------------------------
    Period total, net (1)  60,000     7.39         6.53        April -
                                                                October 2008
    -------------------------------------------------------------------------
    Financial NYMEX         7,500     7.78 US$                 April -
                                                                October 2008
    -------------------------------------------------------------------------
    Period total, net (1)   7,500     7.78 US$     7.53 US$    April -
                                                                October 2008
    -------------------------------------------------------------------------
    Financial              55,000     7.97                     November 2008
                                                                - March 2009
    Physical                7,500     8.36                     November 2008
                                                                - March 2009
    -------------------------------------------------------------------------
    Period total, net (1)  62,500     8.01         7.60        November 2008
                                                                - March 2009
    -------------------------------------------------------------------------
    Financial               7,500     7.46                     January -
                                                                December 2008
    Physical                2,500     7.46                     January -
                                                                December 2008
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Period total, net (1)  10,000     7.46         6.71        January -
                                                                December 2008
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    (1) Weighted average prices are calculated by netting the volumes of the
        financial and physical sold/bought contracts together and measuring
        the net volume at the weighted average "sold" price for the financial
        and physical contracts.
    (2) All transactions at AECO unless identified specifically as a NYMEX
        transaction.
    

    In addition to the mark to market gains inherent in the existing hedge
book of approximately $34 million, PET has realized gains totaling
approximately $48 million to-date in 2007 on financial and physical forward
sales contracts including the crystallization of forward positions. PET will
continue to closely monitor the market drivers with respect to near term
natural gas prices and will proactively manage the Trust's forward price
exposure.
    PET's increased hedging position has significantly reduced its exposure
to potential further downside in natural gas prices. The following table
reflects PET's projected realized gas price, monthly funds flow and payout
ratio at the current monthly distribution of $0.10 per Trust Unit, for July to
December 2007 at certain AECO natural gas price levels and incorporating all
of the Trust's current financial hedges and physical forward sales contracts.

    
                                        Average AECO Monthly Index Gas Price
                                             July to December 2007 ($/GJ)(1)
    Funds flow sensitivity analysis            $5.00   $6.00   $7.00   $8.00
    -------------------------------------------------------------------------
    Natural gas production (MMcfe/d)           198.3   198.3   198.3   198.3
    Realized gas price ($/Mcfe)                 5.88    6.52    7.16    7.80
    Funds flow ($million/month)                 15.7    18.8    21.7    24.7
    Funds flow per Trust Unit ($/Unit/month)   0.146   0.173   0.201   0.228
    Payout ratio (%)                              69      58      50      44
    Ending total net debt ($million)             611     593     575     557
    Ending total net debt to funds flow ratio
     (times) (2)                                 2.6     2.4     2.1     1.9
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    (1) Average AECO price for July-December based on settled prices for
        July-September and AECO forward strip at September 11, 2007 was
        approximately $5.48/GJ.
    (2) Calculated as ending total net debt (including convertible
        debentures) divided by annualized funds flow.
    

    Based on current natural gas prices, PET expects to maintain monthly
distributions at the current level for the foreseeable future. PET reviews
distributions on a monthly basis based on cash flow projections which
incorporate PET's base production forecasts, current hedges and physical
forward natural gas sales, the forward market for natural gas prices, and the
Trust's capital spending program and projected production additions. Future
distributions are subject to change as dictated by changes in commodity price
markets, operations and future business development opportunities.
    PET is also very pleased to announce the appointment of Rick Warters as
Vice President, Geoscience and New Ventures, effective September 4, 2007. Rick
is a Professional Geologist with over 25 years of experience in exploration
and development and will undoubtedly bring significant expertise to the
technical management team as we continue to pursue opportunities to add value
for PET's Unitholders. Rick most recently held the position of Senior Vice
President of Exploration at ConocoPhillips Canada.

    Forward-looking Information

    This news release contains forward-looking information. Implicit in this
information, particularly in respect of cash distributions, are assumptions
regarding natural gas prices, production, royalties and expenses which,
although considered reasonable by PET at the time of preparation, may prove to
be incorrect. These forward-looking statements are based on certain
assumptions that involve a number of risks and uncertainties and are not
guarantees of future performance. Actual results could differ materially as a
result of changes in PET's plans, changes in commodity prices, general
economic, market, regulatory and business conditions as well as production,
development and operating performance and other risks associated with oil and
gas operations. There is no guarantee by PET that actual results achieved will
be the same as those forecast herein.

    Non-GAAP Measures

    This news release contains financial measures that may not be calculated
in accordance with generally accepted accounting principles in Canada
("GAAP"). Readers are referred to advisories and further discussion on
non-GAAP measures contained in the "Significant Accounting Policies and
Non-GAAP Measures" section of the Trust's Management's Discussion and
Analysis.

    Mcf equivalent (Mcfe) may be misleading, particularly if used in
isolation. In accordance with National Instrument 51-101 ("NI 51-101"), an
Mcfe conversion ratio for oil of 1 Bbl: 6 Mcf has been used, which is based on
an energy equivalency conversion method primarily applicable at the burner tip
and does not necessarily represent a value equivalency at the wellhead.

    Paramount Energy Trust is a natural gas-focused Canadian energy trust.
PET's Trust Units and Convertible Debentures are listed on the Toronto Stock
Exchange under the symbols "PMT.UN", "PMT.DB", "PMT.DB.A", "PMT.DB.B", and
"PMT.DB.C" respectively. Further information with respect to PET can be found
at its website at www.paramountenergy.com.

    
    The Toronto Stock Exchange has neither approved nor disapproved the
    information contained herein.
    





For further information:

For further information: Paramount Energy Trust, Susan L. Riddell Rose,
President and Chief Executive Officer, (403) 269-4400; or Paramount Energy
Trust, Cameron R. Sebastian, Vice President, Finance and Chief Financial
Officer, (403) 269-4400; or Paramount Energy Trust, Sue M. Showers, Investor
Relations and Communications Advisor, (403) 269-4400, (403) 269-6336 (FAX); or
Paramount Energy Operating Corp, Administrator of Paramount Energy Trust,
Suite 500, 630 - 4 Avenue SW, Calgary, AB, Canada, T2P 0J9, Email:
info@paramountenergy.com, Website: www.paramountenergy.com


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