Paramount Deals Out 2008 Distribution

Paramount Energy Trust confirmed that its distribution to be paid on March 17, 2008 in respect of income received by PET for the month of February 2008, for Unitholders of record on February 29, 2008, will be $0.10 per Trust Unit. The ex-distribution date is February 27, 2008. The February 2008 distribution brings cumulative distributions paid since the inception of the Trust in February 2003 to $12.124 per Trust Unit.

Natural gas prices continue to be highly volatile, largely around uncertainty regarding weather and its effect on natural gas demand and storage and the global factors influencing LNG shipments to North America. PET continues to be cautious in its outlook with respect to near term natural gas prices and is actively managing its forward gas price exposure to mitigate risk.

In addition, PET realized gains totalling approximately $2 million in January 2008 on crystallization of forward summer 2008 and winter 2008-2009 positions. Based on current natural gas prices, PET expects to maintain monthly distributions at the current level for the foreseeable future. Incorporating PET's current hedging portfolio and the forward market for natural gas prices into the Trust's production, operations and cash flow forecasts for 2008, the current level of distribution annualized would result in an average payout ratio of approximately 53 percent for 2008 and bank debt at year end of approximately $300 million. The Trust continues to focus on what we believe is a sustainable distribution model that balances short term cash returns to our Unitholders and long term value creation. PET reviews distributions on a monthly basis. Future distributions are subject to change as dictated by changes in commodity price markets, operations and future business development opportunities.