Qwest Energy 2004 Flow-Through

Qwest Energy 2004 Flow-Through

May 18, 2006 17:49 ET

Qwest Energy 2004 Flow-Through Completes Rollover of Assets to QE Funds Corp. Mutual Fund

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 18, 2006) - Qwest Energy is pleased to announce that the assets of Qwest Energy 2004 Flow-Through (our fall 2004 flow-through offering), with a value of $23,599,538, rolled over on a tax-deferred basis to the QE Funds Corp. Mutual Fund in exchange for the Mutual Fund's redeemable Qwest Energy Canadian Resource Class shares.

Net Asset Value and Performance

The original per Unit issue price for the Qwest Energy 2004 Flow-Through was $100 per Unit. The investors' at risk capital per Unit, after their flow-through and other tax deductions, was approximately $53.60 per Unit (assumes a marginal tax rate of 46.4% and excludes any Bond RRSP contribution tax deduction for Combined Unit investors). The roll over Net Asset Value per Unit, calculated at the close of business on May 15, 2006, was $100.26 per Unit.

The estimated after tax rate of return is 45.73% and the annualized rate of return is 27.88% (assumes a marginal tax rate of 46.4% and excludes any Bond RRSP contribution tax deduction for Combined Unit investors).

The Mutual Fund

The QE Funds Corp. Mutual Fund, offering Qwest Energy Canadian Resource Class shares, is a new open-ended mutual fund corporation with a mandate of achieving long-term capital appreciation by investing primarily in equity securities of publicly traded Canadian companies involved in the energy and natural resources sectors. The Mutual Fund will target companies with a combination of an experienced management team, sound financial fundamentals and strong growth prospects.

In addition to the assets of the Qwest Energy 2004 Flow-Through, the assets of the Qwest Energy IV Flow-Through Limited Partnership (our spring 2004 flow-through offering) have also been rolled into the Mutual Fund. The total value of the rollover assets into the Mutual Fund will be approximately $44.5 million.

The Mutual Fund has appointed Qwest Energy Fund Management Ltd. ("QEFM") as the Portfolio Advisor, and Ms. Jennifer Stevenson, Executive Vice President and Director of QEFM, will lead the portfolio management team in the management of the Mutual Fund.

The rollover of the Qwest Energy 2004 Flow-Through assets into the Mutual Fund provides investors with a key investment advantage of a well defined liquidity structure and the continuity of professional portfolio management.

About Qwest Energy

Qwest Energy is an oil and gas investment management company which has, during the past six years, raised and successfully invested over $300 million in the Canadian oil and gas sector. Qwest Energy has offices in Vancouver, Calgary and Toronto.


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