December 31, 2003 Update

Although no wells were drilled during December, both the Taber and Hays areas were active from a completions and production operations perspective. At Taber, the 6-31-10-17W4 well that was drilled in November has been completed and production tested. The well flowed at a stabilized rate of two million cubic feet of gas per day plus liquids. Field operations to tie the well in during the first quarter of 2004 are underway. Seventh expects that the well will initially produce one million cubic feet per day plus 50 barrels per day of liquids. We have a 100 percent working interest in the well to payout, and 50 percent thereafter. Also at Taber, Seventh recompleted the suspended 8-18-11-17W4 well in the Taber sand. The well is also currently being tied in, and is expected to be on stream in the first quarter of 2004. Initial production is expected to be 500 thousand cubic feet of gas per day. We have a 100 percent interest in the well.

The fourth well of our ten well exploration farm-in commitment at Taber is scheduled to spud in January at 15-4-11-17W4. This well is the first of four wells we have planned to test the Sunburst sand on the farm-in block. We also have an earning well planned for March that is a delineation test to our recent Taber gas discovery at 6-31.

On the Hays Arcs oil pool, design work has been completed and equipment ordered for the gathering system, field satellite and battery expansion. We are encountering some pipeline right of way issues, and now expect that the construction will be completed by the end of February, one month later than originally anticipated. When completed, the project will allow us to conserve and market solution gas from the pool; as well we will be able to resume production from the 4-7 well, which has been shut in awaiting solution gas conservation. This project will increase production by 135 barrels of oil equivalent per day, and reduce operating costs. In addition, Seventh will be filing an application for GPP on the lower Arcs oil pool at Hays in January 2004, and is currently preparing an upper and lower Arcs waterflood application that is expected to be filed by the second quarter of 2004.

Seventh's current production is 1,360 barrels of oil equivalent per day. We had anticipated to be at 1,500 barrels of oil equivalent per day by the end of 2003, however the shut-in of the high gas rate 4-7 oil well at Hays and the delay in getting the 6-31 Taber well on stream until the first quarter of 2004 have put this target back by one fiscal quarter. In total, Seventh has 700 barrels of oil equivalent behind pipe, over half of which is expected to on steam by the end of the first quarter of 2004, with the remainder on stream in 2005.

This monthly update is general in nature and is intended to give shareholders a current understanding of the activities at Seventh. It is the type of information that would normally be discussed in investor presentations or with analysts or other interested parties who contact the Company directly. No previously undisclosed material information will be discussed in these update letters. New material disclosures will be released in the regulated manner through press releases. Monthly updates will be issued at the end of every month except when quarterly or annual results are released during that month.

Except for statements of historical fact, all statements in this letter - including, without limitation, statements regarding production estimates and future plans and objectives of Seventh - are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Seventh's expectations are disclosed under the heading "Risk Factors", and elsewhere, in Seventh's documents filed from time to time with The Toronto Stock Exchange and other regulatory authorities.