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PanCanadian Makes Scotian Shelf Discovery

PanCanadian Makes Scotian Shelf Discovery

PanCanadian Petroleum Ltd. made a potentially sizable gas discovery offshore Nova Scotia about 25 miles from Sable Island. In the past year, the company has drilled two exploration wells into geological zones under the Panuke oil field, about 155 miles southeast of Halifax. During testing, each well flowed at more than 50 MMcf/d, the maximum capacity of the testing equipment. The wells, PP-3C and PI-1B, intersected net pay of more than 230 feet and 100 feet, respectively.

"This is potentially a very significant natural gas discovery in a region that is quickly emerging as a substantial petroleum province in Canada," said David Tuer, PanCanadian president. "We are very excited by these strong natural gas tests which signal the potential emergence of another East Coast natural gas project."

Calgary-based PanCanadian said it will continue evaluation to determine reserve size and commercial potential with the drilling of at least two Scotian Shelf wells this year. PanCanadian holds a 100% working interest in the discovery.

Spokesman Alan Boras said eventually gas supplies could flow on the Maritimes and Northeast Pipeline. "We haven't got a reserve estimate on this. We haven't got to the question of commercial potential, commercial viability yet, But Maritimes and Northeast is there. It's a common carrier. It would make sense that ultimately that's where this gas would go. We've got a ways to go on the exploration side.

"We're certainly encouraged by it. This is a successful step along the way of a longer-term strategy to look at and build a strong position on the East Coast of Canada."

PanCanadian's total land position offshore Nova Scotia is 15 blocks, covering more than four million gross acres. PanCanadian holds almost 2.5 million net acres on the Nova Scotia blocks. The company is the leading operator of exploration lands on the Scotian Shelf and adjacent deep waters.

To manage the future exploitation of PanCanadian's exploration efforts, Larry LeBlanc has been appointed vice president of East Coast operations. He has been with PanCanadian for 15 years, most recently as general manager of the East Coast business unit.

Joe Fisher, Houston

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