Petro-Canada to increase 2007 spending

Offshore staff

CALGARY, Alberta --Petro-Canada's Board of Directors approved a $4.1-billion capital and exploration expenditure program for 2007, an increase of 15% over 2006.

The 2007 program includes $2.6 billion for growth projects, exploration, and new venture developments, a 37% increase over 2006. The company expects to invest $1 billion to replace reserves in core areas, $400 million to enhance existing assets and improve profitability in the base business, and $100 million to comply with new regulations. The program is expected to be funded primarily from cash flow, the company says.

"Next year is an important year for us with a strong boost in upstream production growth," says Ron Brenneman, president and CEO. "Our upstream production forecast for 2007 includes the full year impact of having big projects like White Rose and the Syncrude expansion on-stream, as well as the startup of Buzzard."

Petro-Canada's upstream production is expected to reach 390,000-420,000 boe/d. Planned growth in 2007 production is due to the ramp up of projects such as Buzzard, De Ruyter, and L5b-C in the North Sea, the full-year impact of production from the Syncrude Stage III expansion, and the return of production of the Terra Nova field in Atlantic Canada.

"Our plans call for one large project coming onstream in each of the next several years," says Brenneman. "Many of these are the type of long-life projects we've been deliberately adding to our portfolio during the last few years. So we're building a strong base of sustainable earnings and cash flow."

12/14/06