FOR IMMEDIATE RELEASE TUESDAY, DECEMBER 21, 2004

Storm Announces Closing of $37.9 Million Asset Acquisition and 2005 Guidance

Storm Exploration Inc. (TSX – SEO) - Storm Exploration Inc. (“Storm”) is pleased to announce that it has closed its previously announced acquisition of oil and natural gas producing properties for $37.9 million, subject to typical closing adjustments. Salman Partners Inc. acted as strategic adviser to Storm in connection with the asset acquisition.

The acquisition was financed by an expanded $24 million credit facility and a $6 million bridge facility, both provided by the Canadian Imperial Bank of Commerce, and from gross proceeds of $14.4 million from a private placement financing which closed December 17th, 2004. Storm’s total bank debt at the end of 2004 is forecast to be $28 million.

For 2005, Storm’s Board of Directors has approved a $26 million capital program which is expected to include the drilling of approximately 20 wells (12 net), the completion of 10 to 15 low risk workovers, tie-ins, and compression projects, and the expenditure of approximately $5.5 million to tie-in a standing Slave Point gas well in the Junior area of north east British Columbia. Production for the year is forecast to average 3,600 to 3,800 boe per day which is expected to result in cash flow in the range of $23 million to $24 million for 2005 using prices of $5.75/GJ at AECO for natural gas and US $38.00 per barrel of WTI oil.

Pursuant to the private placement financing completed on December 17th, 2004, Storm issued 3.0 million subscription receipts at a price of $3.35 per receipt for gross proceeds of $10.05 million and has received offers to purchase 1.0 million flow-through common shares for $4.35 per common share for gross proceeds of $4.35 million. With the closing of the acquisition on December 21st, 2004, the subscription receipts have been converted into 3.0 million common shares and the offers to purchase flow-through common shares have been accepted by Storm and 1.0 million common shares have been issued in accordance with such acceptance. Total gross proceeds of $14.4 million (blended price of $3.60/share) have been released from escrow and will be used to fund the acquisition and exploration and development activities.

The private placement financing was completed with a syndicate of underwriters led by FirstEnergy Capital Corp. and including Tristone Capital Inc., Peters & Co. Limited, First Associates Investments Inc. and Salman Partners Inc.

Storm Exploration Inc. began oil and gas operations effective July 1, 2004. The Company is headquartered in Calgary, Alberta and is active at Red Earth in northern Alberta, Brazeau-Pembina in west central Alberta, the Peace River Arch area of north west Alberta and north east British Columbia, and at Cabin in north east British Columbia.

Certain information set forth in this press release, including management’s assessment of Storm’s future plans and operations, and management’s assessment of the benefits to be derived from the assets acquired through the above described acquisition, contain forward looking statements that involve substantial known and unknown risks and uncertainties. These risks and uncertainties, many of which are beyond Storm’s control, include the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, geological and engineering risks, imprecision of production and reserve estimates, environmental risks, competition from other producers, the lack of available qualified personnel or management, stock market volatility and the ability to access sufficient capital from internal and external sources. Storm’s actual results, performance, or achievement could differ materially from those expressed in, or implied by, these forward looking statements and, accordingly, no assurance can be given that any events anticipated by these forward looking statements will transpire or occur and, if any of them do, what costs and benefits will be derived from them. The forward looking statements contained in this press release are made as of the date of this press release and Storm does not undertake to update publicly or revise any of the forward looking statements included herein in response to new information, future events or any other circumstances whatsoever. Further, where reserves and production are stated on a barrel of oil equivalent basis (“boe”), natural gas volumes have been converted to a boe equivalent using a ratio of 6,000 cubic feet of natural gas to one barrel of oil. This conversion ratio is based upon an energy equivalent conversion method primarily applicable at the burner tip and does not represent a value equivalence at the wellhead. Accordingly, reference to boes may be misleading, particularly if used in isolation.

For further information, please contact: Brian Lavergne, President & CEO or, Donald McLean, Chief Financial Officer, Telephone: (403) 264-3520, Fax: (403) 264-3552.

This news release is not for dissemination in the United States or to any United States news services. The common shares of Storm have not and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold in the United States or to any U.S. person except in certain transactions exempt from the registration requirements of the U.S. Securities Act and applicable state securities laws.

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