PrimeWest Energy Trust Announces Distribution Taxability for 2004

    CALGARY, ALBERTA--(CCNMatthews - Jan. 27, 2005) - PrimeWest Energy Trust 
(TSX:PWI.UN) (TSX:PWX) (TSX:PWI.DB.A) (TSX:PWI.DB.B) (NYSE:PWI) 
(PrimeWest) today announces the taxability breakdown for distributions 
paid to unitholders in 2004.

Canadian Unitholders:

As announced previously on December 8th, 2004, unitholders were paid 
total distributions of $3.315 Canadian per trust unit. For tax filing 
purposes, unitholders should report total distributions declared of 
$3.295 as opposed to distributions paid of $3.315. The company has 
determined that 45% of distributions declared, or $1.48 per trust unit 
is deemed a tax-deferred return of capital and 55% or $1.81 per Trust 
Unit is taxable to Canadian unitholders as "other income" (taxed at the 
same rate as interest income).

United States and Other Non-Resident Unitholders:

For Unitholders resident in the United States, the taxability of 
distributions is derived using U.S. tax rules, which permit the 
deduction of Crown royalties and accounting-based depletion. In the case 
of a U.S. resident, 45% of the distributions are taxable as a "qualified 
dividend" with the remaining 55% treated as a tax-deferred return of 
capital.

Investors who do not qualify as residents of Canada for income tax 
purposes should seek advice from a qualified tax advisor in their 
country of residence regarding the tax treatment of the distributions 
paid by PrimeWest. Monthly distributions payable to non-residents of 
Canada are normally subject to a withholding tax of 25% as prescribed by 
the Canadian Income Tax Act. However, the level of withholding tax may 
be reduced in accordance with reciprocal tax treaties. In the case of 
the Canada - United States Tax Convention, U.S. residents are subject to 
a 15% withholding tax on the distributions paid by PrimeWest.

For further information on taxability of distributions paid by 
PrimeWest, please refer to the Taxation section of our website at 
www.primewestenergy.com and your qualified tax advisor.

PrimeWest is a Calgary-based conventional oil and gas royalty trust that 
actively acquires, develops, produces, and sells natural gas, crude oil, 
and natural gas liquids for the generation of monthly cash distributions 
to unitholders. Trust units of PrimeWest are traded on the Toronto Stock 
Exchange (TSX) under the symbol "PWI.UN" and on the New York Stock 
Exchange under the symbol "PWI". Exchangeable shares of PrimeWest Energy 
Inc. are listed on the TSX under the symbol "PWX". Five-year convertible 
debentures of PrimeWest trade on the TSX under the symbol "PWI.DB.A" and 
the seven-year convertible debentures trade under the symbol "PWI.DB.B".

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