Husky Energy Makes Oil Sands Acquisition

Husky Energy has acquired 23,680 acres of oil sands leases adjacent to its Saleski property. The land was purchased at the April 5, 2006 land sale for approximately $10 million and will add approximately 2.7 billion barrels of bitumen in place to its existing holdings.

Husky, which holds a 100 percent interest in the Saleski leases, completed a four well evaluation program this winter. The results of the Saleski program will provide additional core samples for geological evaluations and will form the basis for enhanced recovery pilots in the coming years.

"This acquisition further increases Husky's oil sands position and will allow the company to become a dominant oil sands player," said Mr. John C.S. Lau, President & CEO. "The acquisition consolidates Husky's total leases in Saleski to 178,560 acres and increases the potential resources in Saleski to approximately 19.5 billion barrels of original bitumen in place."

The potential resources in the Saleski lease is located in the Grosmont carbonate formation and has on average 250 meters of overburden over the lease. Although there are no active commercial projects producing bitumen from carbonates in Alberta, several pilot projects produced bitumen from the Husky leases in the 1970's and 1980's. The Buffalo Creek steam stimulation pilot was among the most encouraging of these pilots and is immediately adjacent to the recently purchased leases.