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PRIMARY PETROLEUM PROVIDES TRANSCRIPT ON ROSETTAS Q1 2011 OPERATIONS ON SOUTHERN ALBERTA BASIN



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PRIMARY PETROLEUM (PIE:TSX.V and PETEF: PK) is pleased to provide you with the following transcript from earlier today on the Southern Alberta Basin from Rosetta Resources Q1-CONFERENCE CALL

A summary of Rosettas Q1 Operational transcript pertaining to the Southern Alberta Basin is as follows:

Rosetta Resources Inc Earnings Teleconference ROSE US

2011-05-09 16:04:09.262 GMT

Event Date: 05/09/2011

Company Name: Rosetta Resources Inc

Event Description:Q1 2011 Earnings Call

Source: Rosetta Resources Inc

MANAGEMENT DISCUSSION SECTION

Randy L.

Limbacher:

Good morning everyone and thank you for joining us for the discussion of our first quarter 2011 operational and financial results. Overall were pleased with our performance during the period and the momentum  that we are gaining in the execution of our strategy.  Rosetta entered 2011 a dramatically different company from what it was one year ago, were more streamlined and more focused.   We also have several catalysts to further growth to test that could be significant including our remaining Eagle Ford acreage as well as the Southern Alberta Basin.

We will increase funding to our evaluation program in the Southern Alberta Basin and you can expect a more specific capital update in August.

Although we have a significant or have had significant interest in a potential joint venture agreement from our Southern Alberta Basin properties, we like what we see so much that weve elected to drill the three-well horizontal tests on our own.  Assuming we have frac crew availability we plan to update you on those results after the third quarter.

We are also pleased that drilling activity in the area is increasing as it accelerates play delineation, as well as helps to establish a local service company infrastructure

We also continue to assess our position in the Southern Alberta Basin.

James E.

Craddock:

Good morning everyone.  Ill provide an overview of first quarter operational performance as well as updated volume and operating expense guidance.  It was a good quarter for the company characterized by well performance above expectation, improved drilling and completion efficiency and progress in our delineation of our Montana positioning. 

Moving on to the Southern Alberta Basin.  We drilled two vertical wells during the quarter.  Late in the quarter, we added a second rig and we have recently TDd our final vertical well, our 11th well overall.  Our commitment for frac services has been secured from mid-May and we should have that program finished up in the late second quarter.  Our plans are to put on at least eight vertical wells on extended production test.  John will fill you in on next steps in Montana in a moment.

John D.

Clayton, Senior Vice President, Asset Development:

Thanks Jim, and good morning, everyone.  Before I get into the nuts and bolts of my portion of the call, let me add some perspective to the information that Ill be presenting.  With the closing of our non-core asset sales behind us, we have our entire asset development technical staffs assigned to three key areas of our business, the exploitation of the Eagle Ford Shale, the exploration of the Southern Alberta Basin and new play identification being a new interest.

If Ive learned one thing in my career is that to have great success in this industry, you better have proven oil and gas finders on your team and the wherewithal to provide them with an atmosphere that allows them to focus on creativity, innovation and science.  With that said, were very proud of our technical staffs, the asset quality that theyre focused on and their initiative to see opportunity where others cannot.  Since quarterly calls are not where you discuss what your new ventures group is working on, Ill provide an update with our continued tremendous success in the Eagle Ford as well as the next phase of our Southern Alberta Basin program.  These are very exciting times for us.

Now lets move to our Southern Alberta Basin program with a very brief update on how we have been approaching this play, where we are today and the new phase were about to embark on.  Were currently at the tail end of our vertical well delineation program.  All 11 wells have now been drilled and a few vertical well tests remain.  We now have geologic and engineering well data from 11 wells spread across our extensive land position.  These results provide us valuable information, such as understanding our regional depositional model, rock mechanics, hydrocarbons in place, pressure regimes and reservoir and stimulation modeling just to name a few.

Our next phase scheduled to begin next month has applied these learnings and allowed us to choose which reservoir or reservoirs are best suited for horizontal drilling, which area or areas are best suited for commercial development and which completion technique is best suited for these rocks.

We are encouraged with the data that our vertical well program has provided us and are exciting to take this play to the next prudent phase, with the drilling of the first of a three well horizontal program set to begin within weeks.

With regards to what we have specifically learnt throughout our vertical program I wont comment on the details but I will offer this.  Our original depositional and structural model has been better defined.  Our understanding of our rock storage capacity has improved.  Our understanding of naturally occurring fractures and the orientations has increased and our understanding of pressure regimes throughout our acreage has also improved.  Needless to say, our enthusiasm remains high as we enter our next phase and I look forward to reporting at our progress on our horizontal program to you later in the year.

Before I turn the call back to Randy, let me follow up with you the comments Randy has made on earlier calls with regard to our openness to take on a partner in the play with the right deal structure.  If you recall those comments were made prior to or early on in our vertical delineation program and obviously prior to our successful divestiture results.  As you would suspect we had a tremendous amount of interest in the play from numerous types of companies.  We did diligently screen these inquires, shared data with a very select few and received numerous offers of participation.  We have declined all of these offers and have decided to go it alone.  Although this place still offers a great deal of risk, we believe it is in the best interest of our shareholders to move forward without a partner during this next important phase.

Randy L.

Limbacher:

Were putting the wheels in motion now to capitalize on the longer term potential of the remaining Eagle Ford properties and our portfolio in the Southern Alberta Basin.  Our company may be more streamlined today, but the growth opportunities that it offers are greater than at any time in our past.

Q&A

Operator:  Our first question comes from Jeff Hayden with Rodman & Renshaw.

Q - Jeffrey Hayden: Okay.  And then jumping up to the Alberta Basin Bakken kind of three horizontal wells, just wondering as much data as you guys are willing to provide as far as what zones youre going to target with those laterals.  Are they all going to target the same zone that youre going to target different zones with the laterals just wonder if youd give us any more color?

A: I wont give you a whole lot of color.  I will tell you that if you exclude the Nisku and the only reason Im excluding that is there is a gross interval that lies between the Three Forks and the Nisku just from a vertical perspective.  The testing were going to do we think will effectively test the Banff, the Bakken and Three Forks on all three of our wells.

Operator: Our next question comes from Monroe Helm with Barrow Hanley.

Q - Monroe Helm: Hey, great results and great outlook.  Just wondering if the joint venture in the Alberta Bakken will be back on the table possibly if you can drill these three horizontal wells where do you think can definitely go it long term in the long run?

A: I think as John mentioned, I think in the script, one of the keys that we got out of this was that we completed our divestiture program and the results were frankly better than we expected going into the year.  So, that gave us, and then we had good result on the bank re-determination.  So, were sitting on a pretty nice position liquidity wise.  When we looked at bringing in a partner around, I mean we, one of the things that weve been saying as we wanted somebody that brings something to the table other than just cash.

And Id say were pretty well positioned on the cash side and we still think that the potential of the Alberta Basin is asymmetrical to the upside.  So, right now we dont have any plans to do that and were always kind of keep our, well always be mindful of doing whats in the best interest of the company.  So, well, I wont say we wont have to re-look at it, but right now we dont probably have any plans to do that.

Operator:  Okay, we will proceed to the next question from Neal Dingmann with SunTrust.

Q - Neal Dingmann: Hey, guys.  Its a good color.  Say Randy or Jim just wondering on up in the Bakken, I might have missed this, what are you expecting as far as just total well cost on these horizontals and as far as laterals and total frac stages you think youd be at this time?

A: Yeah Neal, were expecting something in the $3 million to $5 million range on total well cost and were not really ready to say frac design yet that were still gathering data.  So, but I think you typically look at in the Williston Basin, youre seeing numbers continue to climb upwards of 30 stages.  Keep in mind that lateral lengths maybe a little shorter here.  So when you take all that into account, its something were going to take a look at.

Q - Neal Dingmann: Is there anything from this, the vertical production is that included in your production guidance?

A: No, no that really we havent included anything from the Southern Alberta Basin in the guidance to-date, we feel like still a lot to learn there before wed be doing that.

Operator:  Thank you.  Our next question comes from Jack Aydin with KeyBanc Capital Markets.

Q - Jack Aydin: Second question I have, this is hypothetical on my part, what is the threshold you need in a sense in the Alberta Bakken to in terms of horizontal IP to declare it more or less commercial and start developing, full development going forward?

A: We havent gone out and published our Type Curves.  I think if you take a look at Viewfield over in Saskatchewan in the northern part of the Williston.  There is a similar depth, there are similar spacing on the wells, we believe probably we can, our development program, get to similar well cost.  We like that model a lot for this play to go into full development mode hypothetically speaking.

Operator: Thank you.  Our next question comes from Leo Mariani with RBC Capital.

Q - Leo Mariani: Okay great.  I guess just jumping over to the Alberta Basin Bakken, Jim if you talked about finishing up your 11 vertical well here in the not too distant future.  It sounds like youre testing a lot of it, I mean any particular areas that sort of jumped out is more appealing, was it reasonably consistent in your test in terms of pay thickness and I think you had commented in the past that youve gotten some pretty active oil flow out there, just curious as to whether or not thats continued with some of the recent wells?

A - James E.

Craddock
: Ill be pretty vague on this.  We like our entire position and weve delineated it quite a bit.  So if you follow well permitting and wells drilled, you can see these 11 wells weve drilled are spread out pretty evenly across our entire position.  The only thing Id say is, we think every area has got upside.  Weve seen large accumulations of oil in every well weve drilled and were going to take it horizontal and I think youll also notice if you track permeating the three horizontal wells that although were permeating more than that the three horitzontal wells well be drilling will be spread out pretty far too, but were encouraged by the entire block at least from a perspective standpoint.

Operator: Thank you.  Our next question comes from Irene Haas with Wunderlich Securities.

Q - Irene Haas: Im going to beat the South Alberta Basin to death again.

I have this question that was asked earlier, basically youve drilled about 11 holes right now and I know your pictures versus when you have to just these three wells, how is it different before and after?  And then, this might or might not be a fair question, in conventional oil, you can assign chance of success.  So, my question for you is doing this transition from vertical to horizontal well, how would you kind of assign your chance of success?  And if you dont want to answer that question, what kind of hurdles you need to still conquer before you can declare victory on this horizontal play?

A - John D.

Clayton, Senior Vice President, Asset Development
: Irene, this is John.  You probably arent going to get what you want out of me on the question, but Ill try anyway.  I think there is a 100 chance of success that we produce oil out of our horizontal wells, thats my number and what were dealing with here is a massive rock over a massive area thats got large quantities of oil in it and were wrestling.  And I can speak for Rosetta only, how to best make this play commercial over the largest portion of the play that we possibly can.  There is not a question about whether or not in my mind whether or not were going to produce oil, its a matter of making this commercial.

A: And Irene I guess I would just add, I mean I think weve this before on previous calls there is several different items were trying to resolve here technically.  And weve made progress and so look for us to keep making progress on these items but someone touched on it one of the callers touched on it earlier, where do you place the lateral, what is the right target is on the land or lateral and then how much of the rock can you effectively stimulate?  Were still learning there, but weve gathered a lot of data and were moving forward with it.  So thats weve taken the next logical step in that progression.

Q - Irene Haas: Yeah, so it doesnt sound like as it feels like you guys are pretty comfortable with the pressure regime, it doesnt sound like you have excessive water handling issues?

A: There is no water in this system at least that we can see like when you look at may be some parts of Williston of what lies above the Bakken so we dont see that over there.

Operator: Our next question comes from David Snow with Energy Equities Inc.

Q - David Snow: Yeah hi, one on each of the plays, does it look like it will be a pretty homogenous in the way you would see the rocks so far in the Alberta Basin?

A - John D.

Clayton, Senior Vice President, Asset Development:
So this is John.  No they differ, it differs, same depositional environment, but they do differ from the Canadian border which is where we have leases all the way down 50 to almost 60 miles south.

Q - David Snow: Okay.  So youll need a different method as you go to different areas to fine tune it I guess?

A: I think in any play this large, I mean, it really didnt matter which one you looked back at, take the Bakken in the late 80s and if you look at the different technologies and techniques that have been applied over time, some of the rocks thats making fantastic wells, today was stuff that was written off years ago, and I think as just time goes on every operator including Rosetta will plan to be at the forefront of it, its going to fine tune through this entire process.

We hope you find this update informative.

Regards

PRIMARY PETROLEUM CORPORATION

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