Falcon Natural Gas Corp. Updates Industry Outlook and Reaffirms Growth Opportunities

Business Wire, Sept 22, 2004

HOUSTON -- Falcon Natural Gas Corp. (OTCBB:FNGC) announced today an updated outlook on the natural gas industry and reaffirmed the Company's growth opportunities.

"We launch our exploration program at a time when the future of natural gas has never been more promising," said Max Pozzoni, VP of Business Development, Falcon Natural Gas Corp. "Natural gas remains the fastest growing primary energy source domestically and internationally and is projected to increase from current 24% to 28% of the total energy consumed by 2025. Demand for natural gas from all market segments continues to demonstrate robust growth and gas prices are trading near a 10-year high. Additionally, natural gas is the environmentally cleanest and safest of all energy sources, which makes it ideal for power plants blamed for inflicting global warming problems.

"Currently, however, natural gas production is lagging behind demand and there are few new sources of production on the horizon," continued Mr. Pozzoni. "The robust demand for natural gas, combined with limited growth of new supplies in North America, results in a very favorable environment for Falcon's exploration activities. The data received from high-quality geological studies confirmed a great potential for the success of all four of our prospects, and we believe that Falcon is well positioned for future growth."

According to the Energy Information Administration (AIE), the projections for domestic natural gas consumption in 2025 range from 29.1 TCF per year in the low economic growth case to 34.2 TCF in the rapid technology case, as compared with 22.6 TCF in 2002. Natural gas consumption in the electric power sector is projected to increase from 5.6 TCF in 2002 to 6.7 TCF in 2010 and 8.4 TCF in 2025.

To answer cost-related and environmental needs, most new electricity generation capacity is expected to be fueled by natural gas, because natural-gas-fired generators are projected to have advantages over coal-fired generators that include lower capital costs, higher fuel efficiency, shorter construction lead times, and lower emissions.

Demand growth is also expected in the residential, commercial, industrial, and transportation sectors. Industrial consumption is projected to increase from 7.3 TCF in 2002 to 8.4 TCF in 2010 and 10.3 TCF in 2025.

Historically, although Mexico has considerable natural gas resources, the United States has been a net exporter of gas to Mexico. Net exports of U.S. natural gas to Mexico are projected to grow until 2006. Falcon could benefit from this favorable market environment, given its close proximity to Mexico.

About Falcon Natural Gas Corp.

Falcon Natural Gas Corp. is a Houston, Texas-based natural gas exploration company. The company is focused on the acquisition and exploration of commercial prospects in onshore areas of the United States of America. For more information visit www.falcongas.com

Safe Harbor for Forward-Looking Statements

This release contains certain "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, expectations, beliefs, plans and objectives regarding the potential transactions and ventures discussed in this release. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are the risks inherent in oil & gas exploration, the need to obtain additional financing, the availability of needed personnel and equipment for the future exploration and development, fluctuations in gas prices, and general economic conditions.