Calgary

Despite 1999 production revenue increases of 51% and cash flowincreases of 43%, Calgary-based Canadian 88 took a sharp hit to itsbottom line by a natural gas forward sales contract, which resultedin the company posting a loss of $6.5 million ($0.06 per share).The company had reported earnings of $1.8 million ($0.02 per share)in 1998.

Talisman Energy Inc. and Purcell Energy Ltd. of Calgary formedan exploration joint venture for the greater Fort Liard region inthe southwestern Northwest Territories and southeastern YukonTerritory. The participation right in the joint venture will be 60%for Talisman and 40% for Purcell. “This is Talisman’s firstsignificant move into the Northwest Territories, and we are happyto have Purcell as a partner,” said Talisman CEO Jim Buckee. “Themajority of remaining hydrocarbon potential in Canada lies in themedium and deeper gas plays in Alberta, BC, and the Territories,and Talisman is well positioned as one of the leading deep gasplayers in North America.” “This joint venture strategicallypositions Purcell to leverage its Fort Liard success on SDL 99,”said Purcell CEO Jan Alston. “Talisman’s experience as a successfulfoothills gas explorer combined with Purcell’s long-standinginvolvement at Fort Liard will enable the joint venture partners tocapitalize on opportunities as the area continues to open up.”Preliminary work will commence immediately and be focused on deepgas prospects.

Calgary-based AEC Oil & Gas secured an anchor land positionin the gas exploration fairway of the Mackenzie Delta in theNorthwest Territories. The lands, which were acquired through aproperty swap with Husky Oil, give the partnership of AEC West Ltd.and Alberta Energy Company Ltd. rights to more than 400,000 netacres.

Calgary-based AEC Oil & Gas secured an anchor land positionin the gas exploration fairway of the Mackenzie Delta in theNorthwest Territories. The acquired lands give the partnership ofAEC West Ltd. and Alberta Energy Company Ltd. rights to more than400,000 net acres.

Progas Storage and Marketing, based in Abilene, TX (unrelated toCalgary-based ProGas), announced plans last week to develop 40 Bcfof working storage capacity along major interstate pipelines in theIllinois and Appalachian basins over the next four years.

Progas Storage and Marketing, based in Abilene, TX (unrelated toCalgary-based ProGas), announced plans yesterday to develop 40 Bcfof working storage capacity along major interstate pipelines in theIllinois and Appalachian basins over the next four years.

Petro-Canada of Calgary completed the largest land acquisitionprogram in its history as part of its focus on Canadian frontiergas and Grand Banks oil production. The company participated inthree land sales and a major farm-in to acquire new explorationacreage in the Mackenzie Delta, located in the NorthwestTerritories; the Flemish Pass Basin, located on the East Coastoffshore Newfoundland; and on the Scotian Shelf, located offshoreNova Scotia. The program adds 2.7 million acres (1.5 million netacres) to Petro-Canada’s land position.

EnerMark Income Fund of Calgary offered to acquire all shares ofWestern Star Exploration Ltd. by way of a take-over bid. WesternStar assets are mainly producing gas properties concentrated in theHanna, Taber and Thornbury areas of Alberta. EnerMark’s estimate ofWestern Star’s proven reserves total 36,855 MMcf of gas and 147MBoe of crude oil and gas liquids. These reserve volumes includethe results of a successful 21-well gas development program atHanna Garden.

As might be expected at a Calgary conference where producersdominated attendance and the first day’s panels, bullishness onfuture gas prices ran rampant despite last week’s price slump.Emphasizing the challenges and opportunities in reaching aprojected 30 Tcf/year market by the 2010s, speakers at Ziff EnergyGroup’s North American Gas Strategies conference agreed thatCanadian gas is well positioned to benefit both volume-wise andprice-wise in the coming years.