Viking Energy Royalty Trust

Viking Energy Royalty Trust

March 30, 2005 16:45 ET

Viking Energy Royalty Trust 2004 Income Tax Information for U.S. Investors


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: VIKING ENERGY ROYALTY TRUST

TSX SYMBOL: VKR.UN

MARCH 30, 2005 - 16:45 ET

Viking Energy Royalty Trust 2004 Income Tax
Information for U.S. Investors

CALGARY, ALBERTA--(CCNMatthews - March 30, 2005) - Viking Energy Royalty
Trust (TSX:VKR.UN) ("Viking") announces that 83.07% of the distributions
paid to U.S. investors during 2004 should be treated as Qualified
Dividends and 16.93% of the distributions should be treated as a Return
of Capital for U.S. federal income tax purposes. Viking believes that
the 2004 distributions paid to U.S. individual residents or citizens
should be treated as "qualified dividends" under the U.S. Jobs and
Growth Tax Relief Reconciliation Act of 2003. Viking believes it should
be considered a Qualified Foreign Corporation and its units classified
as equity for U.S. federal income tax purposes.

Unitholders who are resident in the U.S. are subject to a 15% Canadian
withholding tax. Registered nonresident Unitholders will receive a Form
NR4 from Computershare Trust Company of Canada, Viking's transfer agent,
stating the amount withheld. Non-registered non-resident unitholders
should receive this withholding information from their broker. Canadian
tax withheld on the non-taxable portion of the distributions (as
computed under Canadian tax principles) can be claimed as a refund from
the Canada Revenue Agency no later than two years after the calendar
year in which the distribution was paid and should not be claimed as a
deduction or credit against one's U.S. tax liability.

The following table provides, on a per unit basis, the breakdown of cash
distributions, prior to Canadian withholding tax, paid by Viking for the
period January 15, 2004 to December 15, 2004. The amounts are segregated
between the portion of the cash distributions that should be considered
Qualified Dividends and the portion that should be reported as a Return
of Capital. For the Return of Capital portion of the distributions, you
must reduce your cost (or other tax basis) by this amount for
calculating your gain or loss on sale of your Viking units. If the
amount of Return of Capital exceeds your cost (or other basis), report
the excess as a capital gain. The amounts shown are in U.S. dollars
converted from Canadian dollars on the applicable payments dates:



------------------------------------------------------------------------
Taxable
Qualified Return of
Record Payment Distribution Exchange Distribution Dividend Capital
Date Date Paid CDN $ Rate US$ US$ US$
------------------------------------------------------------------------
Dec. 31, Jan. 15, 0.08 0.7705 $ 0.0616 $ 0.0511 $ 0.0105
2003 2004
------------------------------------------------------------------------
Jan. 30, Feb. 16, 0.08 0.7632 $ 0.0611 $ 0.0506 $ 0.0104
2004 2004
------------------------------------------------------------------------
Feb. 27, Mar. 15, 0.08 0.7505 $ 0.0600 $ 0.0498 $ 0.0103
2004 2004
------------------------------------------------------------------------
Mar. 31, Apr. 15, 0.08 0.7426 $ 0.0594 $ 0.0493 $ 0.0102
2004 2004
------------------------------------------------------------------------
Apr. 30, May 17, 0.08 0.7220 $ 0.0578 $ 0.0479 $ 0.0099
2004 2004
------------------------------------------------------------------------
May 31, Jun. 15, 0.08 0.7305 $ 0.0584 $ 0.0484 $ 0.0100
2004 2004
------------------------------------------------------------------------
Jun. 30, Jul. 15, 0.08 0.7556 $ 0.0604 $ 0.0501 $ 0.0103
2004 2004
------------------------------------------------------------------------
Jul. 22, Aug. 16, 0.08 0.7648 $ 0.0612 $ 0.0507 $ 0.0105
2004 2004
------------------------------------------------------------------------
Aug. 23, Sep. 15, 0.08 0.7699 $ 0.0616 $ 0.0511 $ 0.0105
2004 2004
------------------------------------------------------------------------
Sep. 22, Oct. 15, 0.08 0.7988 $ 0.0639 $ 0.0530 $ 0.0109
2004 2004
------------------------------------------------------------------------
Oct. 22, Nov. 15, 0.08 0.8312 $ 0.0665 $ 0.0551 $ 0.0114
2004 2004
------------------------------------------------------------------------
Nov. 22, Dec. 15, 0.08 0.8177 $ 0.0654 $ 0.0542 $ 0.0112
2004 2004
------------------------------------------------------------------------
Total 0.96 $ 0.7374 $ 0.6114 $ 0.1260
------------------------------------------------------------------------


Viking is not required to file Form 1099s and is providing this
information in lieu of such requirement. Some Unitholders will receive
Form 1099s from their brokers that may not accurately reflect the
information in this release for a variety of reasons. Investors should
consult their brokers and tax advisors to ensure that the information
presented here is accurately reflected in their tax returns.

This information is not exhaustive of all possible U.S. income tax
considerations and is provided as a general guideline only. Unitholders
should consult with their legal and tax advisors regarding their
individual tax consequences. Viking has not obtained a legal or tax
opinion, nor has it requested a ruling from the IRS, on these matters.

Viking Energy Royalty Trust is an open-end investment Trust that
generates income from long-life oil and natural gas producing properties
in Alberta and Saskatchewan. The beneficiaries of Viking are the holders
of the Trust Units who receive monthly distributions of the cash flow
from the income. Viking currently has 167,554,069 Units outstanding
which trade on the Toronto Stock Exchange ("TSX") under the symbol
"VKR.UN". Also listed on the TSX are Viking's $74.3 million principal
amounts of 10.5% convertible unsecured subordinated debentures which
trade under the symbol "VKR.DB".

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Viking Energy Royalty Trust
    Bob Fotheringham
    Vice President Finance and CFO
    (403) 268-3175 or Toll Free: 1-877-292-2527
    or
    Viking Energy Royalty Trust
    Diane Phillips
    Investor Relations
    (403) 268-3175 or Toll Free: 1-877-292-2527
    Email: vikingin@viking-roy.com
    Website: www.vikingenergy.com
    or
    Viking Energy Royalty Trust
    Suite 400, 330-5th Avenue S.W.
    Calgary, Alberta, T2P 0L4