PanOcean Recommences Full Production at Obangue in Gabon

Pan-Ocean Energy reports that on December 27, 2003 oil production at its Obangue facility, onshore Gabon, was restored to a level of approximately 3,000 (2,775 net to PanOcean) barrels of oil per day.

"With the Obangue file back in full production, PanOcean is looking forward to another year of stable and growing production from its Gabon properties," stated David Lyons, PanOcean President and Chief Executive Officer.

Production at Obangue had been interrupted following a fire at the field treatment facilities on November 6, 2003. With production now restored to pre- incident levels, oil from Obangue is again being exported via the Total- operated Avocette field pipeline.

PanOcean is currently processing Obangue production using rental equipment. Permanent replacement processing facilities will replace the rental equipment and the new equipment is planned to be operational by mid-year 2004. The rental of the temporary production equipment and the costs associated with the incident itself are the subject of an insurance claim by PanOcean.