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September 15, 2014
Hon. David Alward, Progressive Conservative Party of New Brunswick
Mr. Brian Gallant, Liberal Party of New Brunswick
Mr. Dominic Carcly, New Democratic Party of New Brunswick
Mr. David Coon, Green Party of New Brunswick
Mr. Kris Austin, Peoples Alliance of New Brunswick

Dear Party Leaders,
In recent days, there has been much public and media discussion of Corridor Resources and our ongoing
operations in New Brunswick. As a company involved in the energy sector, we understand that elections are often
used to discuss energy issues. That is only appropriate. Energy policy, after all, can have a significant impact on
consumers, the environment and the economic performance of any jurisdiction. Some of the public discussion has
involved our activity in the Penobsquis and Elgin areas. As a company, Corridor is involved in business, not politics.
Still, we favour a robust and informed public discussion of any issue.

Our desire with this letter to all party leaders is to inform each of you about our operations so that you may
participate in the ongoing public discourse in an informed manner. We are hopeful that this additional knowledge
will help you make a meaningful contribution to the public debate. We are very appreciative of the fact that
parties approach issues from different perspectives with different values and we would not pretend to seek one
view from all parties. However, in the cacophony of an election, basic information can often be overlooked,
misunderstood or misrepresented. We realize that perhaps some of this is caused because our operations in New
Brunswick are not widely known or understood. Here is some basic information about Corridors operations, as the
only company currently producing natural gas in New Brunswick.
Natural Gas in NB
Many of you will know that natural gas was used in the Moncton area in the early 1900s to power street lights and
other uses. This was sourced from reserves that were very close to the surface and using rudimentary practices to
extract and transport the natural gas. With the electrication of the province, the use of natural gas was displaced.
Following the energy crisis in the early 1970s, national efforts were made to explore for more domestic supplies of
oil & gas. Much of the initial exploration effort across Atlantic Canada was conducted at this time and resulted in
signicant discoveries offshore Nova Scotia and Newfoundland. In 2000, Corridor Resources was exploring for
onshore resources and made a significant discovery of natural gas near Sussex. In the following years, Corridor
raised signicant capital to further explore and develop its McCuily Field there. As you would know, natural gas is
unlike oil in that it requires a pipeline network to access markets. At that time, there were no pipelines in the
Sussex area. Fortunately, there were significant potash resources nearby and Corridor was able to establish a great
partnership with Potash Corp to use natural gas to dry its potash. Our natural gas replaced imported oil resulting in
reduced greenhouse gas emissions and significant savings to the potash operation. During the drilling of a natural
gas well, Corridor discovered a previously unknown potash deposit which became the resource impetus to develop
the recently opened second potash mine.

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Due to the construction of the Maritimes and Northeast Pipeline, Corridor Resources was able to make a
signicant investment in 2006-2007 to build a lateral to the pipeline enabling it to reach other NB natural gas users
and the export market. This link to other markets was essential to encourage further
expansion of Corridors exploration and production activities. Since the company was formed in 1995,
Corridor and its partners have invested over $500 million in New Brunswick. We have reinvested every
cent eared in New Brunswick and much more.... back into New Brunswick. Additionally, we have
recruited partners and other investors to invest in New Brunswick. There ls little doubt that our success
and the prospectivity of New Brunswicks geology encouraged SWN Resources to seek a land position to
pursue its own exploration activities in central and eastern New Brunswick.
To date, we have drilled 43 wells, built a natural gas processing plant and operate over 14 kilometres of
gathering lines and a 50- kilometre lateral to MNP.
New Brunswick's Geology
Over the last 15 years, through active exploration and production, we have learned a lot about New
Brunswicks geology in the Penobsquis and Elgin areas. The resource is here and it is signicant. An
independent analysis estimates the McCully and Elgin areas (the Frederick Brook Shale) contains 67
Trillion Cubic Feet (Tcf) of gross discovered resources. It's important to recognize that approximately 20-
30 percent of shale gas resources can typically be produced using current technology. For a sense of
scale, all of Canada consumes about 3 Tcf of natural gas per year.
From our drilling activity, we have determined the natural gas is located in both a shale layer and a sandstone layer
far under the surface. The thickness of the gas-bearing tight sandstone and shale vary from several meters thick to
more than a kilometre thick. On the surface, shale is commonly used for landscaping, and some buildings in
Fredericton and Saint John were built using sandstone.
Use of Fracture Stimulation
Much of the discussion has been focused on the use of fracture stimulation to explore for and produce
natural gas. To be clear, Corridor has been fracture stimulating wells in New Brunswick for more than 10
years. We have conducted 109 fracture stimulations in our wells over that time with no adverse impacts
on potable water aquifers. New Brunswick's geology governs the exploration and production methods
deployed. As mentioned previously, the natural gas is mainly located in either tight sandstone or shale
(both hard substances). There is no other method to release the natural gas from tight sandstone or
shale other than through fracturing the rock. That is the reality.
During the exploration phase, the only way to accurately determine the size of the resource and
whether it can be produced economically is through the use of fracture stimulation. There is no other
way. Seismic research and the drilling of stratigraphic core holes can help evaluate the geological
formations and their composition at different depths. No company would rlsk the exploration
investment if it might be prohibited from producing the resource.
People often wonder how often fracture stimulation is required when producing natural gas. Generally,
it is very infrequent. Corridor operates some wells that were fractured 10 years ago and still produce
natural gas without additional fracturing. Across North America, it is common to have wells producing
more than 20 years after initial fracture stimulation. At Corridor, fracture stimulation is used to
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determine the weIl's potential or to produce from a new section of the shale or sandstone layer.
Recently, Corridor has been fracturing using propane. We find it effective and most of the propane is re-
captured in the well production.
Much of the public discussion has been about using fracture stimulation and any impact it may have on
water resources. Corridor believes the actual signicant experience across Canada, where over 175,000
wells have been fracture stimulated, is relevant to that determination. Nevertheless, oil and gas
development is an industrial activity and accidents or mistakes can happen -no industrial activity is
without any risk. Under the proper and stringent regulations in place in New Brunswick, the likelihood of
an accident is extremely remote. Conducted properly and appropriately regulated, fracture stimulation
is an essential practice in Canada's oil and natural gas industry. Over 85% of all the wells currently
producing in Canada have been fracture stimulated.
Corridor's Current Activity
Corridors 2014 work program is underway and nearing completion. The $25 million program was
designed to increase production from existing wells in the Mccully field and to further explore the
Frederick Brook shale. The program re-entered ve wells and includes up to three fracture stimulations
in sandstone intervals and up to seven fracture stimulations in shale intervals. Approximately twenty-
five percent (25%) of total eld production is owned by Potash Corp. and used in its New Brunswick
Some of the recent discussion has focused on whether there are sufficient economic benets from oil
and gas activity to justify any risks associated with the activity. We understand that debate and would
encourage it as an important part of the policy-making discourse. There are many examples across
Canada to examine whether or not the sector is beneficial to economies. What we do know is that with
our operations in the Penobsquis and Elgin areas, our activity has generated many good-paying jobs,
millions in tax and royalty revenue, local property taxes, lease revenue for landowners and has had a
signicant positive impact on our many suppliers and customers. As well, we know we are blessed with
a supportive community for which we are immensely grateful. At Corridor, we don't take local support
for granted. We operate to the highest standards in the industry to ensure our operations are safe,
protect the precious local environment and economically benet the local community.
New Brunswick has been Corridors home for more than 15 years. We see tremendous opportunity for
growth here. All the factors are lined up for related energy activities such as LNG exports and pipelines.
A local supply of natural gas is essential for the energy competitiveness of New Brunswick's industries
and all local natural gas customers. A continued willingness of New Brunswick to be open to energy
investment will unleash that potential.
Thank you for your considering our information.

Philip Knoll