PanCanadian to develop Panuke gas field off Nova Scotia for $1 billion (Can.)

The board of PanCanadian Petroleum Ltd., Calgary, has approved the $1 billion (Can.) development of Deep Panuke gas field off Nova Scotia. It said the development cost included a pipeline to shore. PanCanadian has 100% of the field, 250 km southeast of Halifax in the Sable Island area. Deep Panuke underlies the Panuke oil field.


HOUSTON, Feb. 23�The board of PanCanadian Petroleum Ltd., Calgary, has approved the $1 billion (Can.) development of Deep Panuke gas field off Nova Scotia.

It said the development cost included a pipeline to shore.

PanCanadian has 100% of the field, 250 km southeast of Halifax in the Sable Island area. Deep Panuke underlies the Panuke oil field.

PanCanadian said production would plateau at 400 MMcfd following start-up in early 2005, based on reserves of 1 tcf.

Since 1999, PanCanadian has drilled four wells into Deep Panuke. Each was tested at more than 50 MMcfd.

It did not plan more delineation or development wells for Deep Panuke this year, but will drill four wildcats on other blocks off Nova Scotia.

David Tuer, PanCanadian's president and CEO, said, "The scope of this field will provide us with significant market volumes. And while there is a lot of engineering and optimization design work to be done, we are very confident that the development of Deep Panuke will create long-term value for our shareholders and for the province of Nova Scotia.''

PanCanadian plans to file a development plan application with the Canada-Nova Scotia Offshore Petroleum Board in the third quarter. It will include details on all aspects of the project, including geological, engineering, and construction data; environmental and safety plans; socioeconomic impact studies; and a Canada-Nova Scotia industrial benefits plan.

The company holds 4.4 million gross acres off Nova Scotia through interests in 15 exploration licenses. It has an average working interest of 55% and operates 14 of the licenses.

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