ST. JOHN’S – The Canada-Newfoundland Offshore Petroleum Board today announced
that it has approved, with conditions, the Terra Nova Canada-Newfoundland Benefits Plan
and the Terra Nova Development Plan. The Board also released its Decision 97-02 report,
which sets out these two approvals in detail.

The Terra Nova oil field is located approximately 350 km east-southeast of St. John’s,
Newfoundland, 35 km southeast of the Hibernia oil field, in a water depth of 90 to 100 m.
The total recoverable oil reserves in the field are estimated by the Board to be some 64
million cubic metres (400 million barrels).

The proposed development project involves the production of oil using a steel ship-shaped
floating production storage and offloading (FPSO) vessel moored by means of a
disconnectable turret. The FPSO vessel will be self-propelled and equipped with a dynamic
positioning system to provide a high level of station-keeping capability. One or more
conventional semi-submersible mobile offshore drilling units will drill the 36 or more wells
through which oil will be produced, water injected, or gas re-injected. The wells will be drilled in clusters through manifolds installed in “glory holes”. The “glory holes” will allow
the manifolds to be located below the projected level of iceberg scour. Oil will be
offloaded from the FPSO vessel to shuttle tankers that will transport the oil directly to
market or to the trans-shipment facility being constructed at Whiffen Head in Newfoundland’s
Placentia Bay.

The proponents of the Terra Nova development project are Petro-Canada Ltd., Mobil Oil Canada Properties, Husky Oil Operations Limited, Murphy Oil Company Limited, Norsk Hydro
AS and Mosbacher Operating Limited. Petro-Canada will operate the project on behalf of the other proponents.

The Board’s decision follows comprehensive internal and public reviews of the Terra Nova development application. The public review included advance public information sessions by Petro-Canada, and public hearings by a review panel appointed jointly by the Board and by environment ministers of the federal and provincial governments.

The Panel was comprised of Dr. Leslie Harris (Chair), Ms. Irene M. Baird, and Dr. Jon Lien. The Board’s Acting Chairman, John Fitzgerald, thanked the Panel for the thoroughness of its review and said that its recommendations are reflected in the Board’s Decision Report.

The Board’s decision respecting the Terra Nova Development Plan is a “fundamental decision” under the Canada-Newfoundland Atlantic Accord Implementation Acts that required and has received the approval of the Minister of Mines and Energy of the Government of Newfoundland and Labrador and the Minister of Natural Resources Canada of the Government of Canada.

Decision 97-02 contains a total of twenty-three conditions, eight of which apply to the Terra Nova Canada-Newfoundland Benefits Plan and fifteen of which apply to the Terra Nova Development Plan.

The Canada-Newfoundland Offshore Petroleum Board is an independent joint agency of the Government of Canada and the Government of Newfoundland and Labrador which draws its authority from “mirror” legislation passed both in the federal Parliament and in
the provincial legislature. It is responsible for the regulation of petroleum-related exploration and development activity in the Newfoundland Offshore Area.

This release, a backgrounder and the full text of Decision 97-02 are available on the Board’s Internet site at

For more information, please contact:

John G. Fitzgerald
Acting Chairman and Chief Executive Officer
Canada-Newfoundland Offshore Petroleum Board
5th Floor, TD Place
140 Water Street
St. John’s, Newfoundland
A1C 6H6

Telephone: (709) 778-1452
Fax: (709) 778-1473