Denver-based Forest Oil. Corp. and Shell Canada Ltd. have agreedto jointly explore and develop a 162-square mile area of theSouthern Foothills near Waterton, AB. Forest will have a 40%working interest in the joint venture, and expects to spend $10million to $15 million in the next year.

Forest said the gas area operated by Calgary-based Shell hascumulative production to date in excess of 4 Tcf from deepstructural reservoirs, and is expected to become a source of”significant” exploration opportunities into the future.

Already, work has begun on a 100-square mile 3-D seismic programto refine several existing prospects, and to allow mapping for moreexploration. In a separate field development plan, Forest and Shellplan to drill a horizontal re-entry well at 7-3-6-3W5. If that goesas planned, the first exploratory well is expected to be drilledafter final interpretation of the 3-D seismic data in 2001, saidForest. Shell would operate both of these wells. The drillingschedule may begin as early as this fall, following public hearingsand regulatory steps.

“We welcome the opportunity to be Shell’s partner in thisSouthern Foothills play,” said Robert S. Boswell, Forest chairmanand CEO. “Shell has had great success in this area, and we believethe joint venture program will prove very beneficial to bothcompanies.” Boswell said Forest was happy to add “this highlyprospective natural gas area to its already large portfolio of deepgas exploration prospects.”

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