ZARGON ENERGY TRUST
TSX : ZAR.UN

ZARGON ENERGY TRUST
Zargon Oil & Gas Ltd.
TSX : ZAR

Zargon Oil & Gas Ltd.

February 22, 2007 16:53 ET

Zargon Energy Trust Announces Canadian Tax Treatment of 2006 Distributions

CALGARY, ALBERTA--(CCNMatthews - Feb. 22, 2007) - Zargon Energy Trust ("Zargon") (TSX:ZAR.UN)(TSX:ZOG.B) announces that for Canadian tax reporting purposes, all distributions paid to unitholders with Record Dates in the 2006 taxation year are taxable.

The information contained herein is based on Zargon's understanding of the Canadian Income Tax Act and is provided for general information purposes only. Unitholders should consult their tax advisors with respect to their particular circumstances.

UNITS HELD WITHIN AN RRSP, RRIF, RESP OR DPSP

With respect to units of Zargon Energy Trust held in an individual's Registered Retirement Savings Plan (RRSP), Registered Retirement Income Fund (RRIF), Registered Education Savings Plan (RESP) or Deferred Profit Sharing Plan (DPSP) during 2006, no amount should be reported on the individual's 2006 Income Tax Return ("T1").

UNITS HELD OUTSIDE AN RRSP, RRIF, RESP OR DPSP

Zargon unitholders who held their trust units outside an RRSP, RRIF, RESP or DPSP will receive a T3 Supplementary Slip for 2006 ("T3") that will report all such distributions as "other income" in Box 26 of the T3. Registered unitholders will receive a T3 slip from Zargon's transfer agent, Valiant Trust Company, while beneficial unitholders who held units through intermediaries will receive a T3 receipt from the intermediary.

FOR CANADIAN TAXPAYERS

The following table summarizes, on a monthly basis, cash distributions with record dates in 2006 to unitholders, indicating that the full amount is taxable and no portion is considered to be a return of capital.




Taxable Amount Return of Total Cash
Record Date Payment Date (Other Income) Capital Distribution

January 31, 2006 February 15, 2006 $0.18 $0.00 $0.18
February 28, 2006 March 15, 2006 $0.18 $0.00 $0.18
March 31, 2006 April 17, 2006 $0.18 $0.00 $0.18
April 30, 2006 May 15, 2006 $0.18 $0.00 $0.18
May 31, 2006 June 15, 2006 $0.18 $0.00 $0.18
June 30, 2006 July 17, 2006 $0.18 $0.00 $0.18
July 31, 2006 August 15, 2006 $0.18 $0.00 $0.18
August 31, 2006 September 15, 2006 $0.18 $0.00 $0.18
September 30, 2006 October 16, 2006 $0.18 $0.00 $0.18
October 31, 2006 November 15, 2006 $0.18 $0.00 $0.18
November 30, 2006 December 15, 2006 $0.18 $0.00 $0.18
December 31, 2006 January 15, 2007 $0.18 $0.00 $0.18
-------------------------------------
Total $2.16 $0.00 $2.16
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Based in Calgary, Alberta, Zargon's securities trade on the Toronto Stock Exchange (TSX). Trust units of Zargon trade under the symbol "ZAR.UN", exchangeable shares of Zargon trade under the symbol "ZOG.B".

In order to learn more about Zargon, we encourage you to visit Zargon's website at www.zargon.ca where you will find a current unitholder presentation, financial reports and historical news releases.

Contact Information

  • Zargon Energy Trust
    C.H. Hansen
    President and Chief Executive Officer
    (403) 264-9992
    or
    B.C. Heagy
    Executive Vice President and Chief Financial Officer
    (403) 264-9992
    Email: zargon@zargon.ca
    Website: www.zargon.ca