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Gold/Mining/Energy : KERM'S KORNER -- Ignore unavailable to you. Want to Upgrade?

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To: Kerm Yerman who wrote (10643) 5/12/1998 8:00:00 PM From: Herb Duncan   Respond to of 15196   ENERGY FUNDS / Petrobank Proposed $13,500,000 Private Placement TSE SYMBOL: PBG MAY 12, 1998 CALGARY, ALBERTA-- Petrobank Energy and Resources Ltd. ("Petrobank") announces a proposed $13,500,000 private placement of up to 6,000,000 special warrants to be issued to investors at a price of $2.25 per special warrant. Each special warrant will be exercisable to acquire one common share of Petrobank for no further consideration. It is anticipated that the private placement will close on or before June 3, 1998. Petrobank intends to use the proceeds from this private placement for its ongoing exploration and development program. Stephen Avenue Securities Inc. will act as agent for this offering.

To: Kerm Yerman who wrote (10643) 5/12/1998 8:05:00 PM From: Herb Duncan   Respond to of 15196   MERGERS-ACQUISITIONS / Globex Announces Closing of the IPO and the Proposed Acquisition of a Private Oil and Gas Company ASE SYMBOL: GBX MAY 12, 1998 CALGARY, ALBERTA--Globex Resources Ltd., a junior capital pool company, is pleased to announce completion of its initial public offering of 1.5 million shares at 20 cents each pursuant to its final prospectus dated February 25, 1998 filed in the Province of Alberta raising gross proceeds of $300,000. As a result, there are currently 3.5 million common shares issued and outstanding. Whalen, Beliveau & Associates Inc. acted as the agent for the offering. Globex has also signed an Agreement in Principle with 758118 Alberta Ltd., a private oil and gas company ("Privco"), which would qualify as its proposed Major Transaction. Under this agreement, Globex has agreed to purchase all of the issued and outstanding common shares of "Privco" for an aggregate consideration of $1,917,000 to be satisfied through issuance of 4,260,000 shares of Globex at a deemed price of $0.45 per share on the basis of one common share of Globex for each common share of Privco. Upon completion of the Major Transaction, Globex will have 7.76 million common shares that are issued and outstanding. Privco has varying interests in producing properties and undeveloped lands with proposed drilling locations, all in Central Alberta. The producing properties include three light oil non-operated properties at Bellshill Lake (20 percent), Garrington (20 percent) and Wilson Creek (35 percent). The properties currently produce approximately 50 BOE/day net to Privco from 20 producing wells. Privco also holds a 25 percent interest in a well at Barrhead, which was recently cased as a potential gas well. In addition, Privco holds 200,000 shares of an Alberta based private company with exploration interests in Pakistan. Privco plans to participate in two light oil drilling locations on undeveloped lands in the Nevis and Highvale areas of Alberta. The company also plans to participate in one horizontal development well using under-balanced drilling technology at its Bellshill Lake producing property. The proposed three wells are scheduled for the third quarter of 1998. Privco's non-operated working interests in these locations vary between 20 percent to 35 percent. Completion of the proposed Major Transaction for acquisition of all the issued and outstanding common shares in Privco will qualify as a Major Transaction, as defined in the Securities Act (Alberta), for Globex and is therefore, subject to the requirement of the Alberta Securities Commission Rule 46-501 and The Alberta Stock Exchange Circular No. 7 and majority of minority shareholders of Globex. The common shares of the Globex will commence trading on The Alberta Stock Exchange under the stock symbol GBX on May 12, 1998.

To: Kerm Yerman who wrote (10643) 5/12/1998 8:08:00 PM From: Herb Duncan   Respond to of 15196   MERGERS-ACQUISITIONS / Northstar Exchanges Morrison Middlefield Shares For Oil Production TSE, ME, ASE SYMBOL: NEN MAY 12, 1998 CALGARY, ALBERTA--Northstar Energy Corporation today announced that it has agreed with Morrison Middlefield Resources Limited to exchange the shares and options of MMRL held by Northstar for MMRL's 50 percent interest in Mountain Energy Inc. which owns certain of MMRL's Canadian oil and gas properties. The properties being acquired by Northstar from MMRL are located primarily in the Halkirk area of central Alberta and represent approximately 2,100 barrels of oil equivalent per day of current production, the majority of which is low operating cost, light oil. John Hagg, chief executive officer, stated that "through the transaction, we are acquiring the remaining 50 percent interest in existing Northstar-operated properties, thereby furthering our strategy of increasing working interests in our core areas. In addition, Northstar will cease to manage the operations of MMRL, consistent with Northstar's objective of focussing its efforts on its own oil and gas exploration, development and production activities." Northstar owns approximately 4.2 million common shares of MMRL and options, exercisable at $5.00 per share, to acquire an additional 1.2 million common shares. In commenting on the exchange transaction, John Richels, chief financial officer noted that "in our 1998 budget, we anticipated the sale of our holdings in MMRL and the reinvestment of the proceeds into oil and gas properties. Through this transaction, we have accomplished both objectives in one step." John Richels went on to say that "otherwise, our 1998 budget remains unchanged and, with our ongoing non-core property disposition and capital expenditure programs, we anticipate our long-term debt will be approximately $350 million by year end." The transaction is subject to certain approvals and conditions, including the approval of the Toronto and Montreal stock exchanges and other securities regulatory authorities and is expected to close on July 31, 1998, with a June 30, 1998 effective date. Northstar Energy Corporation is a Canadian company engaged in petroleum and natural gas exploration and production. The company's common shares are listed on the Toronto, Montreal and Alberta stock exchanges under the trading symbol NEN.

To: Kerm Yerman who wrote (10643) 5/12/1998 8:09:00 PM From: Herb Duncan   Respond to of 15196   EARNINGS / Harbour Petroleum - 1997 Financial Results TSE SYMBOL: HRP MAY 12, 1998 CALGARY, ALBERTA--In 1997 gross revenues before royalties were $6.9 million, a 31 percent decrease from the previous year. Daily oil production, including natural gas liquids, averaged 318 barrels in 1997 compared to 389 barrels in 1996. Daily natural gas production averaged 6,583 MCF in 1997, down from the previous year at 13,509 MCF. The Company's average oil price was $20.65 per barrel in 1997, a 40 percent increase from the previous year. The average natural gas price was $1.68 per MCF in 1997 compared to $1.48 in 1996. Cash flow from operations declined slightly in 1997 to $2.4 million. Reductions in revenue were offset by lower costs in all categories. In the first quarter of 1997, with the disposition of Jenner and Cessford South, the Company had no debt and working capital of $7.2 million. Throughout the year, the Company added $20.4 million (before dispositions), to capital assets. This consisted of acquisitions of $8.3 million, drilling and completion costs of $6.4 million, land and seismic of $3.5 million, and $2.2 million of other costs. The company ended the year with bank debt of $4.9 million and a working capital deficiency, excluding bank debt, of $4.1 million. Under the terms of Harbour's banking agreement this working capital deficiency must be rectified by June 14, 1998. The company has received and is currently reviewing firm offers to sell certain properties to bring the current ratio in line prior to June 14 and to provide additional working capital. Proved plus probable oil and liquids reserves at the end of 1997 increased to 5,138 MBBLS from 1,207 in 1996. The change was due primarily to the Wayne-Rosedale acquisition. Proved plus probable natural gas reserves decreased to 15,462 MMCF in 1997 from 1996 totals of 66,613 MMCF. The disposition of Jenner and Cessford South in March 1997 was responsible for the decrease. Harbour Petroleum Company Ltd has 27,892,847 outstanding common shares and is listed on The Toronto Stock Exchange - symbol HRP.

To: Kerm Yerman who wrote (10643) 5/12/1998 8:14:00 PM From: Herb Duncan   Respond to of 15196   CORP / TUSK Reports on Impact of Fires in Meekwap Area TSE, ASE SYMBOL: TKE MAY 12, 1998 CALGARY, ALBERTA--TUSK Energy Inc. advises that it expects production from the 4-21 well to be restored at the Meekwap field by the end of this week. Timing may be impacted by further changes in the forest fire situation in the general Meekwap area. The 4-21 well, which flows at rates of approximately 1800 boepd, represents approximately 50 percent of total gross production from the Meekwap field. All wells are expected to be operative shortly thereafter once full electrical service is restored. Production operations at the Meekwap Field were suspended on May 4 due to the forest fire situation. Fires were started by lightning strikes to the north and west of the field during the early morning hours on May 3. Since that time extensive areas to the north, south and east of the Meekwap field have been effected. Fire prevention consultants and equipment, positioned in the field early last week to protect key installations, minimized fire damage in the field area. TUSK committed to make space available for a base camp and more than 50 forestry personnel arrived at Meekwap late last week. While there has been some fire damage to vegetation within the area of the Meekwap field, none of the TUSK wells or facilities have been damaged. The drilling of an additional stepout well, offsetting the recent discovery at 4-21, will be delayed due to the fire situation in the area. The well is expected to spud prior to the end of May.

To: Kerm Yerman who wrote (10643) 5/12/1998 8:15:00 PM From: Herb Duncan   Respond to of 15196   CORP / Harbour Petroleum Company - Appointment of Ronald A. Howard, Vice President, Exploration - Sale of Wayne-Rosedale TSE SYMBOL: HRP MAY 12, 1998 CALGARY, ALBERTA-- SALE OF WAYNE-ROSEDALE Harbour Petroleum Company Limited announces the sale of a 100 percent working interest in the Wayne-Rosedale oil field to an industry partner subject to the normal industry closing procedures. The effective date of the sale is April 1, 1998 and closing is expected to be on or before June 8, 1998. The purchase price is $8.8 million dollars and a royalty consideration of quarterly payments over the next three years when certain production levels are exceeded. The sale of this property will provide additional working capital as well as rectify a working capital deficiency under Harbour's banking agreement. APPOINTMENT OF RONALD A. HOWARD, VICE PRESIDENT, EXPLORATION Ronald A. Howard has been appointed Vice President, Exploration effective May 1, 1998, and as a result the action by Ronald A. Howard will be discontinued. Harbour Petroleum Company Ltd. has 27,882,847 outstanding common shares and is listed on The Toronto Stock Exchange - symbol HRP.

To: Kerm Yerman who wrote (10643) 5/12/1998 8:17:00 PM From: Herb Duncan   Respond to of 15196   FIELD ACTIVITIES TOP 20 LISTED / Canadian 88 Energy Corp. Updates Foothills Drilling Program; Spuds Second Deep Well at Caroline; Operations Proceeding Full Steam Ahead at Waterton and Wildcat Hills TSE, ASE, AMEX SYMBOL: EEE MAY 12, 1998 CALGARY, ALBERTA--Canadian 88 Energy Corp. of Calgary, Alberta, announced today that it has spudded a second deep test on its foothills natural gas play in the Caroline area of West Central Alberta. The well is being drilled and operated by Canadian 88 at L.S.D. 10 of Sec. 2, Twp. 35, Rge. 6 W5M to a total depth of 4,055 meters at an estimated cost of $3.7 million to evaluate all formations down to the Cambrian. Canadian 88 is also currently operating the drilling of a new well located in the Caroline area at L.S.D. 7 of Sec. 19, Twp. 33, Rge. 5 W5M being drilled to a total depth of 4,000 meters. A third deep well has also been licensed by Canadian 88 at Caroline in L.S.D. 10 of Sec. 24, Twp. 34, Rge. 6 W5M. The L.S.D. 7 of Sec. 19 Caroline well is being drilled immediately offsetting a 3,200 acre drilling license in Twp. 33, Rge. 5 W5M which sold for a record bonus of $8.25 million at the March 5, 1998 Alberta Petroleum and Natural Gas Rights Sale. The wells are part of a large multi-well deep drilling program Canadian 88 currently has underway in the Caroline/Chedderville area. In addition, the Company said today in Calgary that it has successfully completed the drilling of wells #5 and #6 on its large Waterton natural gas play in the foothills of Southwest Alberta into the Mississippian formation and intermediate casing is currently being set on these wells to a total depth of 3,465 meters and 3,575 meters respectively, located at L.S.D. 3, Sec. 7, Twp. 7, Rge. 2 W5M and L.S.D. 16, Sec. 13, Twp. 7, Rge. 3 W5M. Both wells are being drilled down to the Devonian formation at an estimated total depth of 4.590 meters (14,917 feet) and 4,677 meters (15,200 feet). The Company further said that construction operations are fully underway on its new 27 mile, 10 inch Waterton sour gas pipeline which will connect reserves from this play into Shell Canada Limited's Waterton Gas Plant. The Waterton play is being developed 100 percent by Canadian 88 Energy Corp. with Prize Energy Inc. having a 10 percent carried interest in the project. In other developments, the Company said that drilling is proceeding ahead without difficulty on its new pool Wildcat well at L.S.D. 2 of Sec. 33 - Twp. 31 - Rge.10 - W5M at Yara Creek on the Company's Wildcat Hills exploration play. The well is evaluating the first of three large foothills Mississippian thrust sheets the Company has identified in the area for drilling during 1998. Reserve potential of these thrust sheets range from 100 to 500 Bcf apiece. Canadian 88 paid $1.58 million in total bonuses for 8,320 acres in the Wildcat Hills area at the March 5, 1998 Alberta Government Land Sale with offsetting lands purchased by Petro-Canada and Shell Canada Limited totaling $1.26 million for 5,760 acres. The well is expected to reach total depth within the next two to three weeks. Canadian 88 has budgeted $175 million of capital spending in Western Canada during 1998 alongside its $150 million Rocky Mountain Exploration (RMX) Fund focusing on deep foothills natural gas exploration and development. Canadian 88 Energy Corp. (EEE) is an independent public oil and gas company with head offices in Calgary, Alberta, Canada. The shares of Canadian 88 Energy Corp. are traded on the Toronto, Alberta and American Stock Exchanges.

To: Kerm Yerman who wrote (10643) 5/12/1998 8:21:00 PM From: Herb Duncan   Respond to of 15196   SERVICE SECTOR / Syner-Seis Technologies and Exploration Innovations Sign Agreement With GeoQuest ASE SYMBOL: SYN MAY 12, 1998 CALGARY, ALBERTA--SYNER-SEIS Technologies Inc. and its wholly-owned subsidiary, Exploration Innovations Inc. (EI) are pleased to announce the signing of a business agreement with GeoQuest, a division of Schlumberger Canada Limited. Through the provision of software products, data services, data management and information technology services, GeoQuest assists its client in optimizing the value of their oil and gas reserves. GeoQuest's products integrate geology, geophysics, petrophysics and engineering with interpretation and visualizations, reservoir modelling and simulation, full reservoir characterization, mapping and modelling and data management. The agreement with GeoQuest will provide El's client with access to an entire geophysical and geological interpretation software suite. Specific geophysical and geological software products to be made available are IESX Kit 2D/3D, GeoFrame Geology Kit, CPS-3 Mapping Software System, GeoViz and Voxels. The addition of these applications will significantly enhance our product mix and is expected to have a positive impact on our profitability. In total, over $340,000 dollars of GeoQuest software will be available to El clients and the cost El will be in the form of license maintenance fees, user fees and participation in a co-operative advertising agreement. Always known for its ability to provide service via Landmark(R) software programs, this agreement coupled with the previously released revenue sharing agreement with Paradigm (new release dated Feb. 23, 1998), will allow El's clientele access to unique seismic interpretation products from the world's three largest purveyors of such programs. This business agreement is the second in a series of proposed technology transfer agreements that form the backbone of our innovative "Technology Boutique" concept. GeoQuest is a member of the Oilfield Services Group of Schlumberger, a world-wide leader in the provision of oilfield services. Schlumberger has operations in over 100 countries and records revenues exceeding 10 billion dollars annually derived from real-time drilling, fluids engineering and pumping, seismic data acquisition, seismic processing and interpretation, data services and software.

To: Kerm Yerman who wrote (10643) 5/12/1998 8:23:00 PM From: Herb Duncan   Respond to of 15196   FINANCING / First Star Energy Ltd. Shareholder Rights Plan ASE SYMBOL: FST MAY 12, 1998 CALGARY, ALBERTA--First Star Energy Ltd. ("First Star") (ASE: FST.A) announces that, subject to regulatory approval, the Board of Directors has approved a shareholder rights plan, which is effective immediately. The shareholders of the Corporation will be asked to approve the Shareholder Rights Plan at the Annual and Special Meeting of Shareholders to be held June 18, 1998. The Plan will terminate if not confirmed by a majority of the votes cast by shareholders at the meeting. The Plan has been adopted in order to provide First Star's Board of Directors and shareholders sufficient time to assess and evaluate any take-over bid or acquisition proposal. The Plan is similar to other plans adopted recently by other Canadian corporations. The Plan has not been adopted in response to, or in anticipation of, any specific take-over bid or acquisition proposal. The rights which now form part of each outstanding common share and which will trade with the common shares and not be exercisable until the "separation time", will entitle shareholders, in certain circumstances, including the event where a person acquires 20 percent or more of the outstanding common shares, other than through a "permitted bid", to acquire First Star common shares at half of the current market price. The Plan provides that a permitted bid is a take-over bid made to all shareholders for outstanding shares of First Star, which must be outstanding for at least 45 days. The officer responsible for issuance of this press release and who may be contacted for further information is: John E. Squarek, President

To: Kerm Yerman who wrote (10643) 5/12/1998 8:27:00 PM From: Herb Duncan   Respond to of 15196   CORP / Coho Announces New Shareholder NASDAQ SYMBOL: COHO MAY 12, 1998 DALLAS, TEXAS--Coho Energy, Inc. (Nasdaq:COHO)("Coho") today announced that The Morgan Stanley Leveraged Equity Fund II, L.P. ("MSLEF II") and Quinn Oil Company ("Quinn") have sold 1,485,184 common shares of Coho to Energy Investment Partnership No. 1 ("Energy Investment Partners"), whose principal owners are Thomas O. Hicks, John R. Muse, and other members of Hicks, Muse, Tate & Furst Incorporated. A spokesman for Energy Investment Partners said the firm acquired the shares because, in its opinion, Coho has a strong asset base that is currently undervalued by the marketplace. Energy Investment Partners is attracted by Coho's enviable track record and supports the Company's current strategy which includes a focused U.S. oil and gas operation coupled with a sizeable international exposure. Energy Investment Partners believes the exploration and production segment of the energy sector is poised for a turnaround and that an investment in a growth company such as Coho comes at an opportune time. The members of Energy Investment Partners intends Coho to be its principal upstream energy investment vehicle and expects that consolidation in the oil and gas exploration and production industry will present numerous opportunities for growth. Energy Investment Partners intends to assist Coho in the expansion of its asset base and its corporate growth. The shares purchased from MSLEF II and Quinn, together with shares recently acquired by Energy Investment Partners in the open market, represent approximately 9.25 percent of the outstanding shares of Coho. Effective with the purchase, Howard Hoffen and Carl Quinn resigned from Coho's Board of Directors. Two representatives of Energy Investment Partners, Mr. John R. Muse and Mr. Lawrence D. Stuart Jr., will serve on the Board of Directors of Coho. Commenting on the sale of shares by MSLEF II and Quinn, Jeffrey Clarke, Coho's chairman and chief executive officer, said, "I want to express my appreciation to MSLEF II and Quinn for their contributions and support as shareholders over the last four years. Coho is extremely pleased to have Tom Hicks, John Muse and their partners join the Company as major shareholders, and we look forward to a long and mutually beneficial relationship." While Energy Investment Partners includes a number of the members of Hicks, Muse, Tate & Furst Incorporated, neither Hicks Muse itself nor the Hicks Muse Equity Fund is a participant in the present transaction. Coho Energy,Inc., is a Dallas-based independent oil and gas producer focusing on exploitation of underdeveloped oil properties and exploration in Oklahoma and Mississippi.

To: Kerm Yerman who wrote (10643) 5/12/1998 10:41:00 PM From: Arnie   Respond to of 15196   EARNINGS / Canadian Natural Resources reports 1st 3 months Results CALGARY, May 12 /CNW/ - CANADIAN NATURAL RESOURCES LIMITED announces its financial results and supplementary operating data for the first quarter ending March 31, 1998. Canadian Natural's production volumes of oil and natural gas increased in the first quarter of 1998 to 78,121 barrels of oil and liquids per day and 673.3 million cubic feet of natural gas per day, from 63,782 barrels of oil and liquids per day and 600.5 million cubic feet of natural gas per day for the comparable period in 1997. These volumes represent year over year increases for oil and liquids of 22% and 12% for natural gas. Lower prices for both oil and natural gas resulted in a 30% reduction in the Company's average sales price on a barrel of oil equivalent basis. Royalty expenses decreased, reflecting the sensitivity of royalty rates to lower commodity prices. Oil operating costs were reduced by 5% while gas operating costs increased as successful exploration and development in British Columbia resulted in greater than anticipated volumes of natural gas from areas which are subject to higher processing and transmission fees. << ------------------------------------------ ------------------------------------------ THREE MONTHS ENDING MARCH 31 % 1998 1997 Change ------------------------------------------ ------------------------------------------ FINANCIAL (thousands of dollars, except per share amounts) Gross revenues $ 203,248 $ 246,137 -17 Cash flow $ 95,420 $ 143,449 -33 Per share $ 0.97 $ 1.47 -34 Net income $ 8,351 $ 38,010 -78 Per share $ 0.08 $ 0.39 -79 OPERATING Oil and natural gas liquids Daily production (barrels) 78,121 63,782 +22 Netback per barrel Sales price $ 11.57 $ 21.14 -45 Royalties 1.66 3.54 -53 Operating costs 4.88 5.12 -5 ------------------------------------------ $ 5.03 $ 12.48 -60 ------------------------------------------ CANADIAN NATURAL RESOURCES LIMITED ------------------------------------------ ------------------------------------------ THREE MONTHS ENDING MARCH 31 % 1998 1997 Change ------------------------------------------ ------------------------------------------ Natural gas Daily production (million cubic feet) 673.3 600.5 +12 Netback per thousand cubic feet Sales price $ 2.01 $ 2.30 -13 Royalties 0.32 0.46 -30 Operating costs 0.35 0.32 +9 ------------------------------------------ $ 1.34 $ 1.52 -12 ------------------------------------------ Combined (per barrel of oil equivalent)(x) Daily production 145,449 123,830 +17 Sales price $ 15.53 $ 22.09 -30 Royalties 2.35 4.04 -42 Operating costs 4.23 4.19 +1 ------------------------------------------ Netback per boe $ 8.95 $ 13.86 -35 General and administrative 0.29 0.24 +21 Interest 1.17 0.55 +113 Capital taxes 0.20 0.20 - ------------------------------------------ Cash flow per boe $ 7.29 $ 12.87 -43 ------------------------------------------ (x) (10 mcf of natural gas = 1 barrel of oil) ------------------------------------------ ------------------------------------------ THREE MONTHS ENDING MARCH 31 1998 1997 ------------------------------------------ ------------------------------------------ DRILLING PROGRAM Gross Net Gross Net Oil 82 75.1 156 137.2 Natural gas 104 94.9 129 114.9 Injection/Strat test 18 13.5 - - Dry 35 33.1 52 48.5 ------------------------------------------ 239 216.6 337 300.6 ------------------------------------------ Success Rate 85% 84% ------------------------------------------ ------------------------------------------ THREE MONTHS ENDING MARCH 31 % 1998 1997 Change ------------------------------------------ ------------------------------------------ CAPITAL EXPENDITURES (thousands of dollars) Net property acquisitions $ 10,969 $ 206,470 -95 Land acquisition and retention 7,488 23,569 -68 Seismic evaluations 12,950 18,665 -31 Well drilling, completion, equipping 144,689 120,920 +20 Pipeline and production facilities 106,449 77,370 +38 ------------------------------------------ Total $ 282,545 $ 446,994 -37 ------------------------------------------ ---------------------------------- ---------------------------------- THREE MONTHS ENDING MARCH 31 1998 1997 ---------------------------------- ---------------------------------- STATEMENT OF EARNINGS (thousands of dollars) Income Oil and natural gas $ 203,248 $ 246,137 Less: royalties 30,818 45,068 ---------------------------------- $ 172,430 $ 201,069 ---------------------------------- Expenses Production $ 55,317 $ 46,646 Administration 3,757 2,711 Interest 15,304 6,081 Capital taxes 2,632 2,182 Unrealized foreign exchange (gain) loss (910) 3,837 Depreciation, depletion, amortization 80,279 68,202 ---------------------------------- $ 156,379 $ 129,659 ---------------------------------- Earnings before income taxes $ 16,051 $ 71,410 Deferred income taxes 7,700 33,400 ---------------------------------- Net earnings for the year $ 8,351 $ 38,010 ---------------------------------- March 31, December 31, 1998 1997 NET UNDEVELOPED LAND (thousands of acres) British Columbia 743 745 Alberta 2,945 2,974 Saskatchewan 833 888 Other 340 331 ---------------------------------- Total Undeveloped Land 4,861 4,938 ---------------------------------- March 31, December 31, 1998 1997 CONDENSED BALANCE SHEET (thousands of dollars) Assets Current assets $ 249,324 $ 185,100 Capital assets 2,951,331 2,746,043 ---------------------------------- $ 3,200,655 $ 2,931,143 ---------------------------------- Liabilities and Shareholders' Equity Current liabilities $ 272,084 $ 203,650 Long-term debt 1,316,105 1,136,276 Deferred credits 396,631 386,903 Shareholders' equity 1,215,835 1,204,314 ---------------------------------- $ 3,200,655 $ 2,931,143 ---------------------------------- March 31, December 31, 1998 1997 COMMON SHARE DATA (millions of shares) Weighted average 98.9 98.0 Outstanding at March 31 Basic 99.1 98.8 Fully diluted 109.0 107.0 >> In the first quarter of this year Canadian Natural's capital program was directed toward drilling and development, including the completion of additional production facilities, on its properties located in the northern areas of the Company's core regions which are easier to access in the winter. This capital program resulted in additions to Canadian Natural's reserve base of 56.4 million barrels of oil equivalent, which replaces 1998 first quarter production by 4.3 times. The benchmark WTI price and the wide differential between prices for light crude oil and heavy crude oils continue to result in lower realized oil prices for Canadian Natural and development of its oil prospects is under constant evaluation to determine the economic viability of each oil project under prevailing pricing. Production volume of crude oil was impacted as a result of shutting in throughout the quarter volumes of heavier quality crude oil which were not returning a positive cash flow due to low realized sales prices. At the end of March, 1998 total shut-in volumes of heavy crude oil amounted to 8,000 barrels per day. A large majority of the Company's spending in the remainder of 1998 will be directed toward exploration, development and production of natural gas. Canadian Natural's current productive capability, excluding the volumes of heavy oil which are shut-in, amounts to 80,000 barrels of oil and liquids per day and 705 million cubic feet of natural gas per day.

To: Kerm Yerman who wrote (10643) 5/12/1998 10:46:00 PM From: Arnie   Respond to of 15196   ENERGY TRUSTS / Orion Energy Trust reports 1st 3 months Results CALGARY, May 12 /CNW/ - ORION ENERGY TRUST (''ORION'') SUBMITS ITS QUARTERLY REPORT FOR THE THREE MONTHS ENDED MARCH 31, 1998 Results from operations Cash distributions for the first quarter of 1998 totaled $3,381,700, or $0.24 per unit. The highlights of the first quarter are as follows: << January 1 to March 31, 1998 -------------------------------------------------------------- FINANCIAL HIGHLIGHTS Revenue $ 6,538,473 Net income $ (882,836) Cash distributions $ 3,381,700 Distributions per unit $ 0.24 OPERATING HIGHLIGHTS Production Crude oil (bbls/d) 2,441 Liquids (bbls/d) 426 Natural gas (mcf/d) 15,809 Total (BOE/d) 4,448 Average Prices West Texas Intermediate (US$/bbl) $ 15.96 Crude oil (Cdn$/bbl) $ 20.08 Liquids (Cdn$/bbl) $ 17.75 Natural gas (Cdn$/mcf) $ 1.81 Total (Cdn$/BOE) $ 19.14 -------------------------------------------------------------- >> Oil and liquids production averaged 2,867 barrels per day, 1.5% lower than the average production rate for 1997. Downtime, due to workovers and pump maintenance at Sundre, Pembina and at the Caroline Cardium E Pool, was partially offset by production increases at East Garrington, where beam compressor units have optimized the flow of oil and liquids. Orion expects oil and liquids production for 1998 to average 3,300 barrels per day. Production of natural gas for the first quarter averaged 15.8 million cubic feet per day, unchanged from the average production rate for 1997. At the end of the quarter, Orion added 1.3 million cubic feet per day of natural gas production at two areas, Westlock and Holmberg, which will be fully reflected in the second quarter of 1998. Orion expects natural gas production for 1998 to average 16.9 million cubic feet per day. The price received by Orion for its crude oil production in the first quarter was $20.08 per barrel, 91% of the posted Edmonton par reference price for 40 degree API oil. This reflects the high quality, light oil reserves in Orion and accordingly, Orion is not currently exposed to the widening differentials between light and heavy crude oil prices. Natural gas prices in the first quarter averaged $1.81 per thousand cubic feet, with the expectation of strengthening natural gas prices through the balance of the year. Despite low crude oil prices, the cash distribution of $3,381,700, represents a distribution of $8.45 per barrel of oil equivalent of production. Development Activities Orion participated in the drilling of 4 gross (0.37 net) wells, resulting in 4 producing natural gas wells at Holmberg. In addition, Orion initiated various stimulation workovers, scale removal, pump and facility optimization projects during the first quarter which are planned to continue through the balance of the year. Plans are underway for additional development work at Sundre and at the Caroline Cardium E Pool, along with the re-entry of a previously abandoned Basal Quartz oil well at East Garrington. Orion is focused on the technical definition and economic prioritization of the broad spectrum of development and optimization projects available on its properties. Cash Distributions Cash distributions for the first quarter totaling $3,381,700 ($0.24 per unit), was paid to unitholders on April 15, 1998. On March 11, 1998, the Board of Directors of Orion approved a resolution whereby, effective August 15, 1998, cash distributions will be paid on a monthly basis, with quarterly ''top-up'' distributions as required to distribute all net cash flow. Initial monthly distributions will commence at $0.07 per unit. The first monthly distribution on August 15, 1998, will be in respect of July 1998 and the record date of the distribution will be July 31, 1998. Liquidity and Capital Resources On March 31, 1998, Orion's bank loan balance totaled $18.1 million. Orion's borrowing base currently totals $40.0 million, leaving Orion with an unused credit facility to finance future acquisitions of $21.9 million. The annual renewal of Orion's revolving credit facility is due on or before June 30, 1998. Outlook Weak crude oil prices and production cutbacks due to pipeline capacities have resulted in lower cash distributions in the first quarter of 1998. Although crude oil prices are not expected to reach levels experienced in 1997, natural gas prices continue to strengthen. Concern surrounding producers ability to add sufficient Western Canadian supply to fill incremental pipeline capacity commencing this fall, has rallied natural gas markets and natural gas prices are expected to continue to strengthen through 1998. Orion, as a result of its high quality light oil reserves and high netbacks, is well positioned to ride out the near term adverse effects of low crude oil prices. Production from Orion's major natural gas properties is principally sold under aggregator contracts. Orion is in an excellent position to benefit from improving natural gas market fundamentals. Orion's development program to accelerate and optimize production will continue throughout 1998. In addition, Orion has identified infill and horizontal drilling prospects which it expects will result in improved recovery rates and reserve growth. Rationalization within the oil and gas industry as a result of lower crude oil prices is expected to provide Orion with the opportunity to acquire quality producing properties. Orion plans to use its unused bank line of approximately $20 million to acquire value enhancing properties which meet its objectives of increasing unitholder distributions and unitholder values. On behalf of the Board of Directors of Orion Energy Holdings Inc. Lamont Tolley President and Chief Executive Officer On behalf of Orion Energy Trust By: Starvest Capital Inc., as Manager Henry Roman President and Chief Executive Officer << Consolidated Balance Sheets (unaudited) March 31, 1998 Dec. 31, 1997 ----------------------------------------------------------------------- ASSETS Current assets Cash and short-term deposits $ 2,378,407 $ 885,991 Accounts receivable 2,103,224 3,925,562 Alberta Royalty Tax Credit receivable 1,002,962 642,148 Prepaid expenses 8,162 12,932 ----------------------------------------------------------------------- 5,492,755 5,466,633 Reclamation fund 240,000 - Capital assets 137,495,482 139,074,797 ----------------------------------------------------------------------- $143,228,237 $144,541,430 ----------------------------------------------------------------------- LIABILITIES AND UNITHOLDERS' EQUITY Current liabilities Accounts payable and accrued liabilities $ 2,389,625 $ 3,798,405 Unit distributions payable 3,381,700 4,372,093 ----------------------------------------------------------------------- 5,771,325 8,170,498 Long-term debt 18,100,000 13,136,980 Future site restoration costs 1,134,294 765,813 ----------------------------------------------------------------------- 25,005,619 22,073,291 Unitholders'equity 118,222,618 122,468,139 ----------------------------------------------------------------------- $143,228,237 $144,541,430 ----------------------------------------------------------------------- ----------------------------------------------------------------------- Consolidated Statement of Earnings Three months ended March 31, 1998 (unaudited) Revenues Petroleum and natural gas $ 7,662,010 Crown royalties (1,653,745) Alberta Royalty Tax Credit 360,814 Freehold and other royalties (153,139) ----------------------------------------------------------------------- 6,215,940 Royalty and other income 322,533 ----------------------------------------------------------------------- 6,538,473 ----------------------------------------------------------------------- Expenses Operating 2,695,595 General and administrative 356,493 Management fee 167,534 Interest 285,050 Depletion and depreciation 3,548,156 Future site restoration 368,481 ----------------------------------------------------------------------- 7,421,309 ----------------------------------------------------------------------- Net loss for the period $ (882,836) ----------------------------------------------------------------------- ----------------------------------------------------------------------- Net loss per trust unit $ (0.06) ----------------------------------------------------------------------- ----------------------------------------------------------------------- Consolidated Statement of Unitholders' Equity Three months ended March 31, 1998 (unaudited) Unitholders'equity, beginning of period $122,468,139 Proceeds on issue of trust units $ 22,215 Net loss for the period (882,836) Cash distributions (3,381,700) Dividends (3,200) ----------------------------------------------------------------------- Unitholders' equity - end of period $118,222,618 ----------------------------------------------------------------------- ----------------------------------------------------------------------- Consolidated Statement of Changes in Financial Position Three months ended March 31, 1998 (unaudited) Operating activities Net loss for the period $ (882,836) Items not involving cash Depletion and depreciation 3,548,156 Future site restoration 368,481 Change in non-cash working capital (932,879) ----------------------------------------------------------------------- 2,100,922 ----------------------------------------------------------------------- Financing activities Issuance of trust units 22,215 Unit distributions paid (3,381,700) Dividends (3,200) Increase in long-term debt 4,963,020 ----------------------------------------------------------------------- 1,600,335 ----------------------------------------------------------------------- Investing activities Capital assets (1,968,841) Reclamation fund contribution (240,000) ----------------------------------------------------------------------- (2,208,841) ----------------------------------------------------------------------- Increase in cash and short-term deposits 1,492,416 Cash and short-term deposits, beginning of period 885,991 ----------------------------------------------------------------------- Cash and short-term deposits, end of period $ 2,378,407 ----------------------------------------------------------------------- ----------------------------------------------------------------------- Consolidated Statement of Cash Available for Distribution Three months ended March 31, 1998 (unaudited) Net loss for the period $ (882,836) Adjustments: Depletion and depreciation 3,548,156 Future site restoration 368,481 Income from direct royalties (254,508) Drawdown reserve to fund costs 600,000 Site reclamation fund (240,000) Non-cash management fee 19,487 ----------------------------------------------------------------------- Cash available for distribution 3,158,780 ----------------------------------------------------------------------- Unit distributions payable (99%) 3,127,192 Income from direct royalties 254,508 ----------------------------------------------------------------------- Cash distribution $ 3,381,700 ----------------------------------------------------------------------- Cash distribution per trust unit $ 0.24 ----------------------------------------------------------------------- ----------------------------------------------------------------------- >>

To: Kerm Yerman who wrote (10643) 5/12/1998 10:49:00 PM From: Arnie   Respond to of 15196   ENERGY TRUSTS / Starcor Energy Royalty Fund reports 1st 3 months Results CALGARY, May 12 /CNW/ - Results from Operations Distributable income for the first quarter of 1998 totaled $2,392,807, or $0.260 per trust unit, compared to $3,300,422, or $0.457 per trust unit for the same quarter of 1997. A 35% increase in production volumes from the same period in 1997 was more than offset by an average 30% reduction in oil and natural gas prices. Starcor Energy Royalty Fund (''Starcor'') submits its quarterly reports for the three months ended March 31, 1998. << ----------------------------------------------------------------------- Three Months Ended March 31 1998 1997 ----------------------------------------------------------------------- Daily Sales Volume Crude oil and NGL (bbl) 1,730 1,135 Natural gas (MCF) 21,782 17,657 BOE per day 3,908 2,901 Average Selling Price Crude oil and NGL (Cdn$/bbl) $ 15.87 $ 26.80 Natural gas (Cdn$/Mcf) $ 1.83 $ 2.33 Total (Cdn$/BOE) $ 17.21 $ 24.65 West Texas Intermediate Average crude oil price (US$bbl) $ 15.96 $ 22.77 Currency - average Cdn$ in US$ $ 0.6991 $ 0.7361 Operating Results Revenues $ 5,147,789 $ 5,642,079 Expenses $ 5,213,806 $ 3,695,301 Distributable income $ 2,392,807 $ 3,300,422 Distributable income per trust unit $ 0.260 $ 0.457 >> Development Activities Pencor Petroleum Limited (''Pencor''), the owner of the working interests in the oil and gas properties, participated in the drilling of 7 gross (0.46 net) wells, resulting in five cased gas wells, one producing gas well and one dry and abandoned well . Pencor expects to participate in the drilling of six new well locations during the second quarter of 1998. Acquisition Activities On April 3, 1998, Pencor closed the acquisition of an addition 1.4232% working interest in the Weyburn Unit for $8.3 million. This acquisition added established oil reserves of 2.78 million barrels, resulting in a reserves balance of 57.5% oil and natural gas liquids and 42.5% natural gas. Production from this interest at Wayburn is currently 265 barrels of oil per day. This acquisition increases Starcor's Reserve Life Index (RLI) to approximately 14.4 years on an Established Reserves basis. Distributable Income Distributable income is based on the royalty income received by Starcor from Pencor Royalty income is the amount from the sale of oil and natural gas, less all costs and expenses in respect of the properties, including operating, capital (other than capital financed from sources other than cash flow), general and administrative costs and debt service charges. Distributable income for the quarter was $2,392,807 ($0.26 per unit). On March 25, 1998, Starcor announced that its regular monthly distribution would be reduced to $0.08 per unit from $0.10 per unit effective the April 15, 1998 cash distribution date, to recognize the adverse impact of weaker world oil prices. The following is a summary of cash distributions paid in 1998: << ------------------------------------------------------------------------ Distribution Distribution Regular Extra Total Record Date Distribution Distribution Distribution ------------------------------------------------------------------------ January 8, January 15, 1998 1998 $ 0.100 $ - $ 0.100 February 9, February 15, 1998 1998 $ 0.100 $ 0.018 $ 0.118 March 9, March 15, 1998 1998 $ 0.100 $ - $ 0.100 April 8, April 15, 1998 1998 $ 0.080 $ - $ 0.080 May 8, May 15, 1998 1998 $ 0.080 $ - $ 0.080 ------------------------------------------------------------------------ $ 0.460 $ 0.018 $ 0.478 ------------------------------------------------------------------------ ------------------------------------------------------------------------ >> Alberta Tax and Revenue Administration recently ruled that Starcor's Alberta Royalty Tax Credit (''ARTC'') entitlement for the 1996 taxation year should be claimed by Pencor, the crown royalty payor and not by Starcor. It has been common practice in other oil and gas royalty trusts for ARTC to be claimed by the trust and not by the operating company. Pencor has filed for the ARTC for both the 1996 and 1997 taxation years and will forward the payments to Starcor upon receipt. This will amount to $0.06 per unit and $0.10 per unit respectively. Liquidity and Capital Resources On April 3, 1998, Starcor financed the Weyburn Unit acquisition with $8.3 million from its credit facility. Starcor's bank loan balance is currently $25.0 million. Starcor has a total credit facility of $50.0 million from which to finance additional acquisitions. Outlook Weak crude oil prices have had an adverse impact on Starcor, particularly in the heavy oil area, resulting in considerably lower netbacks. For the balance of 1998, crude oil prices are expected to continue to be volatile and to be significantly lower than in 1997. However, by increasing its RLI to 14.4 years, one of the highest of all conventional oil and gas royalty trusts, Starcor has positioned itself to overcome the near term adverse effects of lower crude oil prices. At the beginning of the year, natural gas prices were relatively weak because of the warm winter. Natural gas prices have subsequently strengthened and are expected to continue to strengthen throughout the remainder of the year as pipeline expansions are completed. With 56% of its total 1998 production weighted towards natural gas, Starcor is well positioned to reap the benefits of higher natural gas prices. Starcor intends to further exploit its natural gas properties and pursue an aggressive natural gas program for 1998. Rationalization within the oil and gas industry as a result of lower crude oil prices is expected to provide Starcor with a number of opportunities to acquire quality producing properties. Starcor, with an unused bank line of $25.0 million, will continue to identify quality, producing properties for acquisition, which meet both its investment criteria and its objectives of increasing unitholder distributions and unitholder values. On behalf of the Board of Directors of Pencor Petroleum Limited Lamont C. Tolley President and Chief Executive Officer May 11, 1998 On behalf of Starcor Energy Royalty fund By: Starvest Capital Inc., as Manager Henry R. Roman President and Chief Executive Officer May 11, 1998 Consolidated Balance Sheets ------------------------------------------------------------------------ (unaudited) March 31, December 31, 1998 1997 ------------------------------------------------------------------------ Assets Current Assets Cash and short term deposits $ 634,174 $ 872,733 Accounts receivable 3,437,860 5,664,812 Alberta royalty credit receivable 2,029,524 1,773,689 Prepaid expenses 743,158 658,817 ------------------------------------------------------------------------ 6,844,716 8,970,051 Reclamation fund 356,172 249,417 Capital assets 89,022,209 90,989,254 ------------------------------------------------------------------------ $ 96,223,097 $ 100,208,722 ------------------------------------------------------------------------ ------------------------------------------------------------------------ Liabilities and Unitholders' equity Current Liabilities Accounts payable and accrued liabilities $ 2,665,602 $ 3,549,031 Unit distributions payable 748,482 1,284,094 ------------------------------------------------------------------------ 3,414,084 4,833,125 ------------------------------------------------------------------------ Long Term Liabilities Future site restoration costs 1,950,751 1,845,085 Bank loan 15,300,000 15,600,000 ------------------------------------------------------------------------ 17,250,751 17,445,085 ------------------------------------------------------------------------ 20,664,835 22,278,210 Unitholders' equity 75,558,262 77,930,512 ------------------------------------------------------------------------ $ 96,223,097 $ 100,208,722 ------------------------------------------------------------------------ ------------------------------------------------------------------------ Consolidated Statement of Unitholders' Equity ------------------------------------------------------------------------ For the three month ended March 31 (unaudited) 1998 ------------------------------------------------------------------------ Unitholders equity, beginning of period $ 77,930,512 Net loss for the period (66,017) Proceeds on issue of trust units 86,574 Unit distributions (2,392,807) ------------------------------------------------------------------------ Unitholders' equity, end of period $ 75,558,262 ------------------------------------------------------------------------ ------------------------------------------------------------------------ Consolidated Statement of Income ------------------------------------------------------------------------ For the three months ended March 31 (unaudited) 1993 1997 ------------------------------------------------------------------------ Revenues Oil and gas sales $ 6,052,307 $ 6,434,371 Crown royalties (926,778) (1,094,627) Alberta royalty tax credit 263,401 328,630 Freehold and other royalties (293,230) (226,059) ------------------------------------------------------------------------ 5,095,700 5,442,315 Royalty and other income 36,024 39,902 Interest income 16,065 159,862 ------------------------------------------------------------------------ 5,147,789 5,642,079 ------------------------------------------------------------------------ Expenses Operating 1,821,113 1,312,110 General and administrative 152,327 279,694 Management fee 369,380 199,514 Interest 223,497 134,371 Depletion and depreciation 2,533,853 1,650,004 Future site restoration 113,646 119,608 ------------------------------------------------------------------------ 5,213,806 3,695,301 ------------------------------------------------------------------------ Net income (loss) for the period $ (66,017) $ 1,946,778 ------------------------------------------------------------------------ ------------------------------------------------------------------------ Net income (loss) per trust unit $ (0.007) $ 0.270 ------------------------------------------------------------------------ ------------------------------------------------------------------------ Consolidated Statement of Changes in Financial Position ------------------------------------------------------------------------ For the three months ended March 31 (unaudited) 1998 1997 ------------------------------------------------------------------------ Operating Activities Net income (loss) for the period $ (66,017) $ 1,946,778 Items not involving cash Depletion and depreciation 2,533,853 1,650,004 Future site restoration 113,646 119,608 Site restoration costs (7,980) (123) Unit distributions paid (2,928,419) (3,138,952) Change in non-cash working capital 1,003,347 940,789 ------------------------------------------------------------------------ 648,430 1,518,104 ------------------------------------------------------------------------ Financing Activities Issuance of trust units 86,574 105,668 Bank loan (300,000) 5,000,000 ------------------------------------------------------------------------ (213,426) 5,105,668 ------------------------------------------------------------------------ Investing Activities Additions to capital assets (566,808) (30,363,330) Reclamation fund contribution (106,755) - ------------------------------------------------------------------------ (673,563) (30,363,330) ------------------------------------------------------------------------ (Decrease) in cash and short term deposits (238,559) (23,739,558) Cash and short term deposits, beginning of period 872,733 27,115,316 ------------------------------------------------------------------------ Cash and short term deposits, end of period $ 634,174 $ 3,375,758 ------------------------------------------------------------------------ Statement of Royalty Income and Distributable Income ------------------------------------------------------------------------ For the three months March 31 (unaudited) 1998 1997 ------------------------------------------------------------------------ Revenue and expenses of Pencor: Oil and gas revenues $ 5,095,700 $ 5,442,315 Operating expenses (1,821,113) (1,312,110) Administrative costs and fees (439,327) (380,546) Interest (223,487) (184,371) ------------------------------------------------------------------------ 2,611,773 3,615,288 Alberta royalty tax credit accrued - (328,630) Capital expenditures (566,808) (30,363,330) Site restoration costs (7,980) 123 Reclamation fund (105,000) - Use of working capital 866,808 25,363,330 Bank loan (300,000) 5,000,000 ------------------------------------------------------------------------ Royalty income 2,498,793 3,286,781 ------------------------------------------------------------------------ 99% Royalty 2,473,805 3,253,913 ------------------------------------------------------------------------ Interest income of Starcor 1,382 145,171 Administrative costs of Starcor (82,380) (98,662) ------------------------------------------------------------------------ Distributable income $ 2,392,807 $ 3,300,422 ------------------------------------------------------------------------ Distributable income per trust unit $ 0.260 $ 0.457 ------------------------------------------------------------------------

To: Kerm Yerman who wrote (10643) 5/12/1998 10:54:00 PM From: Arnie   Respond to of 15196   EARNINGS / Morrison Middlefield Resources reports 1st 3 months Results Message to Shareholders TORONTO, May 12 /CNW/ - We are pleased to announce MMRL has reached agreement with Northstar to exchange certain Canadian assets for Northstar's holdings of common shares and options of MMRL and to report on the operations and financial performance for the three months ended March 31, 1998. EXCHANGE AGREEMENT FOR NORTHSTAR ENERGY SHARE BLOCK MMRL has entered into an agreement with Northstar to exchange its holdings of Mountain Energy Inc. (''Mountain'') for the 4,216,740 common shares of MMRL and Northstar's option to purchase an additional 1,189,732 common shares of MMRL. Upon completion, the common shares and options representing approximately 25% of the Company will be cancelled. The exchange is subject to regulatory approvals, including an exemption from the Alberta Securities Commission and will have an effective date of June 30, 1998. Closing is anticipated to take place on July 31, 1998, at which time Northstar will resign as manager of MMRL. After the exchange is completed MMRL will have 15,394,822 shares outstanding (15,583,316 on a fully diluted basis). MMRL and Northstar each own 50% of Mountain which holds oil and gas assets located primarily in the Halkirk and Panny areas of Alberta. MMRL's share of the Mountain assets contributed production of approximately 1,500 barrels of oil and liquids per day and six million cubic feet of natural gas per day in the first quarter of 1998 representing about 27% of the Company's total production. Mountain represented 20% of the proven and half probable reserves of the Company reported at December 31, 1997. On a fully diluted per share basis this exchange is expected to be accretive for MMRL shareholders. Using the same basis of calculation as was done in our 1997 annual report, adjusting for the removal of Mountain reserves and estimated land and seismic values, the Company's net asset value per share increases 5.7% using proven plus half probable reserves and the fully diluted number of shares following the cancellation of the Northstar common shares and options. << Proven and Proven and (000's) Proven Half Probable Probable Reserve value(x) $ 114,651 $ 176,885 $ 239,119 Estimated value of undeveloped land and seismic 109,517 109,517 109,517 Working capital (146) (146) (146) Long term debt (46,308) (46,308) (46,308) ----------------------------------------- Net asset value $ 177,715 $ 239,949 $ 302,182 ----------------------------------------- ----------------------------------------- Per share - fully diluted $ 11.50 $ 15.52 $ 19.54 ----------------------------------------- Increase as compared to Dec. 31/97 - +5.7% +9.3% ----------------------------------------- (x) Based on the discounted present value at a 10% discount rate and using constant commodity prices prevailing in December, 1997. >> Cash flow per share is also expected to increase after the exchange which will be felt most noticeably in 1999 when significant growth in cash flow is expected to occur from our development activities in the UK. The Company's spending plans for the balance of 1998 are being reduced to ensure that MMRL maintains a reasonable debt to cash flow ratio. Capital spending for the year as a whole is expected to be $50 million. FIRST QUARTER RESULTS Financial Continued weakening of world oil prices has become the dominant factor affecting the petroleum industry in 1998. The average oil prices received by MMRL during the first three months of this year declined 32% from the average prices realized over the same period a year earlier. Being predominantly an oil producer, this decline in oil prices has had a significant impact on the financial results of the Company. Oil and gas revenues dropped to $13.5 million in the first quarter of 1998 from $18.3 million a year earlier. While lower oil prices were the major cause of this decline, weaker gas prices in the most recent quarter also contributed to the reduction in revenues. Production expenses increased from $3.1 million in 1997 to $5.1 million in 1998. This increase was due in part to the sale in the first quarter of oil inventory in the UK produced late in 1997, an increase in the exchange rate of the British pound relative to the Canadian dollar on a year over year basis and a number of one time adjustments which are not expected to be repeated. Cash flow from operations in the first quarter of 1998 reached $5.2 million or $0.26 per share fully diluted versus $11.0 million or $0.60 per share fully diluted in 1997. A net loss of $2.0 million was recorded in the first quarter or $0.10 per share fully diluted compared to net earnings of $3.9 million last year. The oil futures market presently reflects future oil prices at a premium to the spot price. The Company took advantage of this favourable price situation and has sold forward 2,000 barrels of oil per day for 1999 at a Brent price of US$16.50 per barrel (which equates to about US$18.00 per barrel on a WTI basis). MMRL's dividend policy was implemented at a time when the Company was engaged primarily in the acquisition and exploitation of oil and gas properties that had limited requirements for the reinvestment of cash flow. Given the Company's current exploration and development focus the Company believes it is prudent to preserve its capital for carrying out these activities. Therefore, the Company has decided to eliminate the payment of its regular quarterly dividend. Production Oil and natural gas liquids averaged 6,260 bbls/d in the first quarter of 1998 as compared to 6,205 bbls/d a year earlier. The first quarter in traditionally a weaker quarter for the Company with respect to its oil production as cold weather in the UK increases wax build-up and reduces well performance. Natural gas production averaged 13.6 mmcf/d throughout the first three months of this year versus 14.0 mmcf/d in the same period of 1997. Overall production averaged 7,683 boe/d to March 31, 1998. Drilling Through the first quarter, the Company participated in the drilling of 16 wells which resulted in six oil wells, four gas wells and six wells which were dry and abandoned. << DRILLING RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 1998 ----------------------------------------------------------------------- Canada UK Total ----------------------------------------------------------------------- Gross Net Gross Net Gross Net ----------------------------------------------------------------------- Oil 5 1.7 1 1.0 6 2.7 Natural Gas 4 1.3 - - 4 1.3 Injector - - - - - - Abandoned 4 1.3 2 2.0 6 3.3 ----------------------------------------------------------------------- Total 13 4.3 3 3.0 16 7.3 ----------------------------------------------------------------------- Success Ratio 69% 70% 33% 33% 63% 55% ----------------------------------------------------------------------- Exploration Development Wells Wells Total ----------------------------------------------------------------------- Canada 6 7 13 UK 1 2 3 ----------------------------------------------------------------------- Total 7 9 16 ----------------------------------------------------------------------- >> The most active area of the Company's drilling was in the Panny region of Northern Alberta where a total of 13 wells were drilled experiencing a 69% success ratio. In the UK, three wells were drilled which resulted in one oil well and two dry holes. Two development wells were drilled in the Welton field, one of which was successful while the exploration test at Glanford failed to encounter commercial amounts of oil. During the first quarter, the discovery well at Keddington which was drilled in December, 1997 was worked over. Originally producing 200 bopd, following the workover, production of the well tested up to 700 bopd and is currently producing 250 bopd. The well is currently producing without a pump. Based upon these results and the geological interpretation of the area, this discovery represents the potential for a substantial reservoir. Two appraisal wells are planned this year to test the reservoir extension. Drilling of these wells awaits development approval which is expected in early June. Drilling of the Kyle offshore appraisal well is scheduled to commence in June, 1998. Arrangements are being finalized to tie in production to the Banff field facilities with first production scheduled for the start of 1999. MMRL has a 12.50% working interest in this development. Arrangements to secure a floating, production, storage and offtake vessel for the development of the Chestnut field are still under negotiation by the operator. MMRL has decided to increase its working interest in the field by a further 4% to 17.75%. The operator is planning for first production from this field by the end of the first quarter of 1999. If arrangements to secure a vessel are not finalized in the near future, startup will be pushed back to a later date. Management New management arrangements will be put in place to follow the termination of the Northstar management agreement which will result in lower general and administrative costs. Outlook When the exchange agreement is completed, the Company's Canadian production will be reduced by more than 50%. Additional sales of Canadian production can be expected in the future. UK production in the second half of 1998 should increase as a result of development programs on our Keddington and Cold Hanworth discoveries. In 1999 additional growth in production is projected to come from the Saltfleetby gas reserves being brought on stream and from our major development projects in the North Sea. Peter A. Braaten President and C.E.O. May 12, 1998 Morrison Middlefield Resources Limited << HIGHLIGHTS ------------------------------------------------------------------- 1998 1997 ----------------------------------------------- 1Q 4Q 3Q 2Q 1Q ------------------------------------------------------------------- Production Canada: Oil & NGLs (bbls/d) 2,585 2,663 2,643 2,672 2,805 Natural Gas (mcf/d) 12,642 13,666 12,886 15,086 13,108 UK: Oil & NGLs (bbls/d) 3,675 4,005 3,800 4,063 3,400 Natural Gas (mcf/d) 957 945 638 953 894 Total: Oil & NGLs (bbls/d) 6,260 6,668 6,443 6,735 6,205 Natural Gas (mcf/d) 13,599 14,611 13,524 16,039 14,002 -------------------------------------------------------------------- Financial ($000's) Production revenues 13,486 16,822 16,588 17,294 18,277 Cash flow from operations 5,163 8,536 10,439 9,662 11,014 Net earnings (loss) (1,991) 1,595 3,157 2,131 3,896 Working capital (2,103) (146) 11 (814) (7,200) Total assets 212,806 214,467 190,233 184,928 165,682 Long term debt 53,571 46,308 59,359 55,930 37,138 Shareholders' equity 131,819 134,843 105,203 103,446 99,403 Capital expenditures 13,414 23,237 11,791 24,021 8,714 -------------------------------------------------------------------- Per share ($) Cash basic 0.26 0.42 0.60 0.56 0.65 fully diluted 0.26 0.42 0.57 0.52 0.60 Earnings basic (0.10) 0.08 0.18 0.12 0.23 fully diluted (0.10) 0.08 0.18 0.12 0.21 Dividends 0.05 0.05 0.05 0.05 0.05 --------------------------------------------------------------------- CONSOLIDATED SUMMARIZED BALANCE SHEETS (000's) Unaudited As at March 31 1998 1997 ------------------------------------------------------------------------- Assets Current assets $ 15,199 $ 16,808 Property, plant and equipment, net 197,607 148,649 Other assets - 225 ------------------------------------------------------------------------- 212,806 165,682 ------------------------------------------------------------------------- Liabilities and shareholders' equity Current liabilities 17,302 24,008 Long term debt 53,571 37,138 Future site restoration 2,366 1,264 Deferred income taxes 7,748 3,869 ------------------------------------------------------------------------- 80,987 66,279 Shareholders' equity 131,819 99,403 ------------------------------------------------------------------------- $ 212,806 $ 165,682 ------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF EARNINGS AND RETAINED EARNINGS (000's) Unaudited For the three months ended March 31 1998 1997 ------------------------------------------------------------------------- Revenues Production $ 13,486 $ 18,277 Royalties, net (975) (1,498) ------------------------------------------------------------------------- 12,511 16,779 Interest and other income 129 140 ------------------------------------------------------------------------- 12,640 16,919 ------------------------------------------------------------------------- Expenses Production 5,144 3,070 General and administration 865 1,845 Interest 920 895 Depreciation, depletion and amortization 6,693 5,424 ------------------------------------------------------------------------- 13,622 11,234 ------------------------------------------------------------------------- Earnings (loss) before income taxes (982) 5,685 Income taxes 1,009 1,789 ------------------------------------------------------------------------- Net earnings (loss) (1,991) 3,896 Retained earnings, beginning of period 23,643 16,454 Dividends (981) (851) ------------------------------------------------------------------------- Retained earnings, end of period $ 20,671 $ 19,499 ------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION (000's) Unaudited For the three months ended March 31 1998 1997 ------------------------------------------------------------------------- Operating activities Net earnings (loss) $ (1,991) $ 3,896 Depreciation, depletion and amortization 6,693 5,424 Amortization of foreign exchange (48) 25 Deferred income taxes 509 1,669 ------------------------------------------------------------------------- Cash flow from operations 5,163 11,014 Change in non-cash working capital (481) 1,665 ------------------------------------------------------------------------- 4,682 12,679 ------------------------------------------------------------------------- Financing activities Long term debt 7,262 (2,197) Purchase of common shares for cancellation (9) - Redemption of preferred shares - (32,926) Dividends (981) (851) ------------------------------------------------------------------------- 6,272 (35,974) ------------------------------------------------------------------------- Investing activities Purchase of property, plant and equipment (13,414) (8,714) ------------------------------------------------------------------------- Effect of translation of foreign currency in subsidiaries 21 (28) ------------------------------------------------------------------------- Decrease in cash and short term investments (2,439) (32,037) Cash and short term investments, beginning of period 7,245 36,261 ------------------------------------------------------------------------- Cash and short term investments, end of period $ 4,806 $ 4,224 ------------------------------------------------------------------------- Three months to March 31 Average Prices 1998 1997 ------------------------------------------------------------------------- Canada: Oil & NGLs ($/bbl) 16.28 26.22 Gas ($/mcf) 1.73 2.47 United Kingdom: Oil & NGLs ($/bbl) 19.79 27.50 Gas ($/mcf) 4.06 3.81 Total: Oil & NGLs ($/bbl) 18.44 26.92 Gas ($/mcf) 1.89 2.55 ------------------------------------------------------------------------- >>

To: Kerm Yerman who wrote (10643) 5/12/1998 10:59:00 PM From: Arnie   Respond to of 15196   GENERAL INTEREST / Mercantile International Petroleum & Triunion Energy Company sign Agreement to Develop Power Project NASSAU, Bahamas, May 12 /CNW/ - Mercantile International Petroleum Inc. (''Mercantile'') and Triunion Energy Company (''Triunion''), a company headquartered in Buenos Aires, Argentina announced an Agreement in Principle approved by their boards, to form a 50/50 joint venture to develop an independent gas power project involving gas from Mercantile's Block III, Talara, Peru. The targeted size of the power project is 240 megawatts (''MW''), which may be built in separate stages, with a minimum of 80 - 100 MW in the initial phase planned to be on stream in the first quarter of 1999. The initial phase of 80 - 100 MW of capacity to supply power would require approximately 90 - 110 BCF of gas reserves to be produced at a rate averaging approximately 19 - 24 MMcf per day. The targeted 240 MW facility would require approximately 250 BCF of reserves produced at approximately 50 MMcf per day. The preliminary estimate of cost including hardware and installation from the wellhead through to and including the transmission lines is about U.S. $200 million, including import duties and IGV taxes. The project financing will be provided primarily from a consortium of project lenders providing non-recourse debt, with Mercantile and Triunion providing the equity to underpin the non-recourse debt. Mercantile will be the exclusive supplier of gas to the facility. Mercantile plans to recomplete ten of the 14 wells that Mercantile drilled in 1996, together with additional existing wells in Block III to supply the facility's requirements. J. Arthur Bray, the CEO of Mercantile was quoted as saying: ''With the 3D and 2D interpretation of Block III and a review of existing well information, it has become apparent that Block III contains a very significant quantity of low cost, high quality gas, both in terms of reserves associated with the existing wells and step-out prospects. A third party appraisal of the reserves will be completed in the near term. Mercantile has examined the current and future power needs of Peru, and has concluded that an independent power project using Block III gas should be developed. Indeed, Mercantile is very strategically positioned, both with its gas and its proximity to the existing electrical grid system of Peru, to be the low cost supplier of power in Peru''. Mercantile has been considering proposals from several potential joint venture partners who have varying degrees of experience in the power business in Latin America. Mercantile has selected Triunion due to its experience in the oil, gas and power business in Argentina and its recent development experience in Peru. Triunion owns a 21.8% interest in the Gasoducto del Pacifico, a $400 Million USD natural gas pipeline currently under construction from Neuquen, Argentina to Concepcion, Chile, as well as an interest in the Charagua natural gas exploration area in Bolivia. Capex, S.A. (Capex) is a principal shareholder in Triunion with a 38.4% interest. Capex significant gas production and power generation experience in Argentina. Capex is a publicly traded company on the Buenos Aires and Luxembourg stock exchanges. El Paso Energy International Company is a minority shareholder in Capex and in Triunion. El Paso is also a shareholder in the Aguaytia independent power project located in Peru which entered into commmercial operation in the first half of 1998. Mercantile does not plan to issue any securities to finance its share of the joint venture equity requirements. Mercantile plans to create a Latin American focused gas subsidiary, and is in discussions with potential private equity investors who may ultimately become shareholders in such entity. Mercantile is an ''oil exploitation company'' with interests in Peru, Colombia and Myanmar. The company continues to look for international on-shore properties where the application of leading edge technologies will allow the company to recover more oil. Mercantile's common shares are listed on the Toronto Stock Exchange and trade under the symbol MPTU, while its debentures are listed on the Winnepeg Stock Exchange.

To: Kerm Yerman who wrote (10643) 5/12/1998 11:29:00 PM From: Arnie   Respond to of 15196   FINANCING / CityView Energy issues Shares 1998-05-12 HERDSMAN, WA RE: SHARE PLACEMENT - L.W. MILLER & CO. INC ("MILLER") CityView Energy Corporation Limited ("CityView") in accordance with Listing Rule 7.1 of the Australian Stock Exchange Limited ("ASX") and pursuant to Section 66 of the Corporations Law ("excluded offers") has issued 50,000 free ordinary fully paid shares to Miller at $1.00 par value. These shares have been issued in accordance with Shareholders approval granted at the Annual General Meeting held on 6 May 1998. The shares are issued as payment of compensation and expenses in respect to public relations and direct marketing of the company in the United States. The deemed value of these shares, based on the closing price of the company's shares trading on the ASX on 11 May 1998 of $2.55 per share was $127,500. The shares, the subject of the placement will from the date of allotment rank equally in all respects (including participation in dividends) with the existing issued fully paid ordinary shares of the company and application will be made for official quotation of the shares following their allotment. None of the directors or persons associated with the directors is participating in the issue of the shares. Yours faithfully (SIGNED) A P Woods Company Secretary/Chief Financial Officer Capital Structure: Fully Diluted: 13,757,068 Float: 5,522,049 Australia - CityView Energy North America - Zoya Financial Chris Vander Boom Steve Basra/Jasbir Gill Tel: 011-61-89-445-3199 Tel: 905-763-7773 Fax: 011-61-89-445-3947 Fax: 905-763-7774 cityviewenergy.com email.jazz@wwonline.com

To: Kerm Yerman who wrote (10643) 5/12/1998 11:34:00 PM From: Arnie   Respond to of 15196   EARNINGS / Zargon Oil & Gas report 1st 3 months Results Zargon Oil & Gas Ltd. reported production gains for the first three months of 1998 but due to sharply lower commodity prices, revenues, cash flow and earnings were all below the corresponding period of 1997. The table below sets out comparative values: Earnings/ Cash Flow/ 1st Quarter Earnings(1) Share(2) Cash Flow(1) Share(2) Revenue(1) 1998 $0.36 $.03 $1.53 $.12 $3.39 1997 $0.78 $.06 $1.84 $.15 $4.27 1996 $0.27 $.03 $0.99 $.10 $2.49 (1) Millions of Dollars (2) Fully Diluted Shares Lower commodity prices, which offset a 9 percent increase in production volumes to 2,019 BOE/d, were responsible for the reduced financial results. During the first quarter of 1998, revenue decreased 21 percent from the 1997 period, cash flow from operations declined 17 percent and earnings were down 54 percent. Zargon's 1998 first quarter crude and liquid price decreased 31 percent to $19.04/Bbl from the corresponding 1997 price of $27.54/Bbl. Gas prices declined 18 percent to $1.77/Mcf down from $2.15/Mcf in 1997. Production of Zargon's 32 degree API average crude increased by 13 percent to 1,415 Bbl/d up from 1,252 Bbl/d in 1997. Gas production was flat on a year over year basis at 6.04 MMcf/d. Corresponding decreases occurred on a per share basis. Cash flow per fully-diluted share of $.12 in first quarter 1998 was off 20 percent from the prior year and earnings per share, which are more sensitive to price changes, declined 50 percent. Net capital expenditures of $1.71 million for the first three months of the year represent only 11 percent of the Company's $15 million 1998 capital budget. During the first quarter, Zargon deferred its field capital expenditures for deployment later this year in what is expected to be a lower cost environment. As a result of the reduced spending program, Zargon's long term debt at quarter end remains at $4.74 million representing less than 10 months of cash flow at 1998 first quarter rates. During the first quarter, Zargon drilled an exploratory test at Sturgeon Lake, Alberta where the Company holds a 100 percent interest in a 16 section block of undeveloped land. A Cretaceous formation was drill stem tested at rates of 2.5 MMcf/d. The well will be completed and production tested later this fall, at which time development opportunities, and tie-in economics will be examined. Also in the quarter, Zargon drilled a wholly owned successful horizontal development well at Manor, Saskatchewan. Zargon's inventory of undeveloped land, increased to 87,800 net acres as of March 31, 1998 through a number of small strategic acquisitions. Zargon's strategy since inception has been to grow primarily through the acquisition and exploitation of chosen core areas. We believe 1998, which is likely to be a difficult year for the industry generally, will bring Zargon strategic growth opportunities of substantial size. The company is positioned accordingly, with a strong balance sheet, unutilized bank lines of $11 million and a strengthened and broadened management team. Despite reduced first quarter 1998 financial results, management's intention is to regain past growth rate targets over the balance of 1998. Zargon Oil & Gas Ltd. is an oil and gas company listed on the Toronto Stock Exchange trading under the symbol "ZAR". There are currently 12.72 million shares issued and outstanding. For additional information, please contact Craig Hansen, President & C. E. 0. at (403) 264-9992.

To: Kerm Yerman who wrote (10643) 5/12/1998 11:37:00 PM From: Arnie   Respond to of 15196   EARNINGS / Brascade Resources Inc. reports 1st 3 months Results Editors and Reporters: This release sets out the financial results of Brascade Resources Inc. for the three months ended March 31, 1998. Edward C. Kress, Chairman and President, will be available at (416) 363-9491 to answer questions on the company's financial results. Brascade Resources Inc. today reported net income for the three months ended March 31, 1998 of $156 million. Income for the quarter includes a net investment gain of $150 million related to the sale of Norcen Energy Resources, which closed in early March. Income before this investment gain was $6 million, compared to $17 million for the first three months of 1997. Following the sale of Noreen, Noranda plans to distribute to its shareholders its 67% interest in Noranda Forest during the current quarter and its 100% interest in Canadian Hunter during the third quarter of 1998, subject to regulatory and other approvals. On the completion of these distributions, Brascade will own 19% of Noranda Forest and 29% of Canadian Hunter, and will continue to own 29% of Noranda Inc. and its mining and metals operations. The quarterly dividends on Brascade's preferred shares have been declared payable on June 30, 1998 to shareholders of record on June 20, 1998. ********* Brascade is a natural resources investment company which owns a 29% fully diluted interest in Noranda Inc. Noranda is a major international mining and metals company, which also has operations in the forest products and oil and gas sectors. Noranda currently employs 31,000 people directly and through its affiliates. - 30 - Financial Highlights ---------------------------------------------------------------------------- Three months ended Marcy 31 ------------------- millions, except per share amounts 1998 1997 ---------------------------------------------------------------------------- Revenues $ 8 $19 Income before investment gain $ 6 $17 Investment gain, net 150 - ------------------ Net income $ 156 $17 Per common share: Income (loss) before investment gain $ (0.11) $ 0.05 Net income $ 2.13 $ 0.05 ----------------------------------------------------------------------------

To: Kerm Yerman who wrote (10643) 5/12/1998 11:40:00 PM From: Arnie   Respond to of 15196   CORP. / Triple 8 Ventures Ltd. announcement 1998-05-12 CALGARY, ALBERTA Triple 8 Ventures Ltd. (the "Company"), a junior capital pool company, wishes to announce that it has mailed to its shareholders an information circular and other proxy materials in respect of a combined 1997 and 1998 annual meeting and special meeting of shareholders to approve the Company's proposed major transaction which is the arms-length acquisition from Circumpacific Energy Corporation of seven oil and gas properties including three located in Alberta, three in Saskatchewan and one in British Columbia. This transaction has been revised from the transaction previously announced. All properties are in the Western Canadian Sedimentary Basin. Working interests range from 1.826% to 50%. The package includes interest in three batteries and in gas processing equipment in addition to lands with development potential. The total purchase price for the properties is $507,000, including GST of $7,000, all of which will be paid in cash. The Company has arranged a $250,000 revolving production loan facility (line of credit) from Alberta Treasury Branches to partially fund the acquisition and the balance will come from the Company's working capital. The line of credit is repayable on the earlier of demand or April 30, 1999. The transaction will not result in any change in the management of the Company. The acquisition is subject to and conditional upon the Company's shareholders and The Alberta Stock Exchange (the "Exchange") accepting and approving the transaction as the Company's major transaction. The effective date for the acquisition is July 1, 1997 and interest on the purchase price will accrue at the rate of the Province of Alberta Treasury Branches prime rate plus 2.25% on and from the effective date until closing. All of the properties are subject to a net profits interest of 4% calculated with reference to either the Company's gross overriding royalty share of production or working interest in production, as applicable, payable to Apex Canada Inc., a company controlled by Michael Kamis, a director of the Company. The Company is listed on the Exchange having the trading symbol TVU. Trading in the Company's shares was halted on June 17, 1997 for failing to file Major Transaction documents with the Exchange within the required time after the Company announced the Major Transaction. Trading in the Company's shares on the Exchange is expected to resume on May 13, 1998. For further information, contact Dickson P. Chow, Managing Director of Triple 8 Ventures Ltd. at Suite 306, 602 - 11th Avenue S.W., Calgary, Alberta T2R 1J8, Telephone: (403) 269-3091, Fax: (403) 261-0601. DATED at Calgary, Alberta this 12th day of May, 1998. TRIPLE 8 VENTURES LTD. per: (signed) Dickson P. Chow, Director

To: Kerm Yerman who wrote (10643) 5/13/1998 1:17:00 AM From: Arnie   Respond to of 15196   EARNINGS / Canadian Southern Petroleum reports 1st 3 months Results CALGARY, Alberta, May 12 /CNW/ -- Canada Southern Petroleum Ltd. (Nasdaq: CSPLF) (Toronto, Boston, Pacific Stock Exchanges: CSW) said it had a net loss of $930,000 -- seven cents a share, basic and diluted -- on gross revenues of $503,000 in its fiscal first quarter ended Mar. 31. In last year's first quarter, there was a net loss of $356,000, or three cents a share, on gross revenues of $588,000, the Company said. M. Anthony Ashton, President, said this year's revenues were severely impacted by lower oil and gas prices -- down 37% and 45%, respectively -- despite substantial production increases at company-interest properties. Ashton also noted that Canada Southern expects wrap up its side of the Kotaneelee case before the Court's summer recess at the end of June. Comparative, consolidated results for this year's first quarter and the prior-year period are shown in the following condensed operations and cash flow statements: CANADA SOUTHERN PETROLEUM LTD. Consolidated Statements of Operations (Expressed in Canadian dollars) (unaudited) Three months ended March 31, 1998 1997 Revenues: Oil sales $226,579 $294,397 Gas sales 146,398 187,678 Proceeds under carried interest agreements 56,088 686 Interest and other income 73,649 105,137 502,714 587,898 Costs and expenses: Costs of operations 503,124 368,089 General and administrative 425,171 240,091 Legal expenses 504,088 335,772 1,432,383 943,952 Net loss $(929,669) $(356,054) Average number of shares outstanding 14,234,740 13,956,540 Net loss per share (basic & diluted) $(.07) $(.03) CANADA SOUTHERN PETROLEUM LTD. Consolidated Statements of Cash Flows (Expressed in Canadian dollars) (unaudited) Three months ended March 31, 1998 1997 Cash flows from operating activities: Net loss $(929,669) $(356,054) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation, depletion and amortization 182,900 128,200 Future site restoration costs 7,300 (32,235) Change in current assets and liabilities: Accounts and interest receivable 268,377 (166,713) Prepaid insurance and other (8,911) (8,184) Accounts payable (765,942) 163,530 Accrued liabilities 28,218 37,601 Net cash used in operations(1,217,727) (233,855) Cash flows from investing activities: Additions to oil and gas properties (net) (541,967) (544,907) Sale (purchase) of U.S. Government securities 1,251,483 753,334 Net cash provided from investing activities 709,516 208,427 Decrease in cash and cash equivalents (508,211) (25,428) Cash and cash equivalents at the beginning of period 2,129,156 2,709,597 Cash and cash equivalents at the end of period $1,620,945 $2,684,169

To: Kerm Yerman who wrote (10643) 5/13/1998 1:22:00 AM From: Arnie   Respond to of 15196   EARNINGS & DISCOVERY / Canadian Occidental Petroleum...Arnies #1 CALGARY, May 12 /CNW/ - Canadian Occidental Petroleum Ltd. today reported cash flow from operations of $153 million ($1.12 per share) in the first quarter, compared to cash flow of $217 million ($1.59 per share) in the first quarter of 1997. Lower cash flow was the result of significantly lower worldwide crude oil prices. The Company also reported a loss of $4 million ($(O.03) per share) in the quarter compared to net income of $73 million ($0.53 per share) in the first quarter of 1997. CanadianOxy continues to show strong production growth. Crude oil and liquids production reached 194,000 barrels per day, an increase of 38 per cent over the first quarter of 1997. Record levels were achieved in Yemen where production averaged 200,000 barrels per day (gross) and in Canada after considering the impact of the acquisition of Wascana Energy in the second quarter of 1997 and the subsequent disposition of properties in December 1997. Natural gas production also reached a record high of 440 million cubic feet per day, an increase of 59 per cent over the first quarter of 1997. Victor Zaleschuk, President and Chief Executive Officer commented; ''Oil prices were down by 30 per cent during the first quarter, offsetting the strong production growth from all our ongoing operations. We expected this and took steps early in the year to reduce our 1998 capital program to match our cash flow. We expect higher prices as the year progresses and continue to look for a profitable year overall.'' CanadianOxy's first quarter drilling programs were very successful. A recent discovery at Hay River in northeast British Columbia has the potential to be one of the largest conventional oil discoveries made in Western Canada in 20 years. The pool contains an estimated 135 million barrels of oil in place. The initial development phase will target approximately half of the pool and will result in the Company booking approximately 21 million barrels of proved and probable reserves in 1998. CanadianOxy has a 100 per cent interest in this discovery and holds over 48,000 acres of undeveloped land in close proximity. Subject to receiving regulatory and other appropriate approvals, the Company plans to invest $33 million in this winter-only-access area to develop 6,000 barrels per day of high quality crude oil production by April 1, 1999. Strong pricing and low operating costs for this production will result in a high cash netback. CanadianOxy also plans to continue exploring the trend for other pools which would add to reserves. In the Gulf of Mexico, all three exploration wells drilled during the quarter were successful. At West Cameron 170, net gas pay of 115 feet was found, at High Island 570, net gas pay of 73 feet was found and at Main Pass 71/75, net oil and gas pay of 44 feet was found. CanadianOxy is currently testing and evaluating these discoveries to determine their full extent and capability. In Yemen, three successful development wells were drilled on the Masila Block. Two of the wells, Tawila 19 and 20, encountered the target reservoir approximately 50 feet higher than had been expected. The positive impact of these wells on our reserve base is currently being assessed. CanadianOxy significantly expanded its exploration portfolio during the quarter. With the previously announced acquisitions of interests in two large blocks in Yemen and 64 blocks in the Gulf of Mexico, CanadianOxy now has the largest exploratory land position in Yemen and is one of the 20 largest acreage holders in the deep water regions in the Gulf of Mexico. CanadianOxy's acquisition in Yemen enables the Company to capitalize on its existing knowledge in this basin and its extensive Masila Block infrastructure to create additional longer-term opportunities. The Gulf of Mexico acquisition provides the Company with excellent exploration prospects in this world class basin. The Chemicals Division continues to generate strong financial results. Operating profit and cash flow were unchanged from the first quarter of 1997 at $15 million and $21 million respectively. Capital expenditures totaled $264 million compared to $111 million in the first quarter of 1997. The increased expenditures were the result of higher activity levels in Western Canada, the Gulf of Mexico, Nigeria and Australia. Commenting on the quarter, Victor Zaleschuk said, ''We have high quality assets and take a longer term view of oil prices. This enabled us to significantly enhance our opportunity portfolio in the Gulf of Mexico and Yemen. At the same time, we added substantial value for shareholders through exploration and development in each of our core areas - Canada, Yemen, and the Gulf of Mexico.'' The Board of Directors has declared a quarterly dividend of $0.075 per common share payable July 1, 1998 to shareholders of record on June 5, 1998. CANADIAN OCCIDENTAL PETROLEUM LTD. March 31,1998 << FINANCIAL HIGHLIGHTS (Amounts in millions of Canadian dollars except per share data) Three Months ---------------------- 1998 1997 ---------------------- Net Sales $ 355 $ 363 Cash Flow from Operations $ 153 $ 217 Per Common Share $ 1.12 $ 1.59 Net Income (Loss) $ (4) $ 73 Per Common Share $ (0.03) $ 0.53 Capital Expenditures $ 264 $ 111 Net Debt $ 2,211 $ 438 CASH FLOW FROM OPERATIONS (Amounts in millions of Canadian dollars) Three Months --------------------- 1998 1997 --------------------- Cash Flow from Operations Oil and Gas Yemen $ 91 $ 118 Canada 46 31 United States 37 53 Alternate Fuels 2 16 North Sea 19 21 Other Countries (3) - Marketing 5 - -------- -------- $ 197 239 Chemicals 21 21 -------- -------- 218 260 Interest and Other Corporate Items (38) (13) Income Taxes (27) (30) -------- -------- $ 153 $ 217 -------- -------- -------- -------- OPERATING PROFIT (Amounts in millions of Canadian dollars) Three Months --------------------- 1998 1997 --------------------- Operating Profit (Loss) Oil and Gas Yemen $ 46 $ 71 Canada (32) 7 United States 9 30 Alternate Fuels (1) 13 North Sea 5 9 Other Countries (37) (13) Marketing 3 - -------- -------- (7) 117 Chemicals 15 15 -------- -------- 8 132 Interest and Other Corporate Items (41) (16) Income Tax Recovery (Provision) 29 (43) -------- -------- Net Income (Loss) $ (4) $ 73 -------- -------- -------- -------- PRODUCTION HIGHLIGHTS Three Months ---------------------- 1998 1997 ---------------------- Crude Oil and Natural Gas Liquids (thousand barrels per day) Yemen 103.6 96.1 Canada 62.2 14.4 United States 13.1 13.3 Alternate Fuels 12.7 14.0 Other Countries 2.4 3.3 -------- -------- 194.0 141.1 -------- -------- -------- -------- Natural Gas (million cubic feet per day) Canada 283 118 United States 109 106 North Sea 48 53 -------- -------- 440 277 -------- -------- -------- -------- AVERAGE COMMODITY PRICES (Amounts in Canadian dollars except WTI) Three Months ---------------------- 1998 1997 ---------------------- Crude Oil (per barrel) Yemen $ 19.09 $ 27.06 Canada 12.65 23.26 United States 21.28 31.07 Other Countries 16.55 18.28 Corporate Average 17.03 26.91 Synthetic Crude Oil (per barrel) $ 21.85 $ 30.64 WTl Average (U.S.$) $ 15.95 $ 22.79 Natural Gas (per thousand cubic feet) Canada $ 1.81 $ 2.33 United States 3.39 3.85 North Sea 5.35 5.20 Corporate Average 2.58 3.42 >>

To: Kerm Yerman who wrote (10643) 5/13/1998 1:24:00 AM From: Arnie   Respond to of 15196   FIELD ACTIVITIES / Westfort Energy updates Drilling Activity JACKSON, MISSISSIPPI, May 12 /CNW/ - Whitney Pansano, President of Westfort Energy Ltd. (symbol WT on Toronto Stock Exchange), announced today that Nabors Drilling Company started moving its rig No. 544 on the prepared location for the company's Pelahatchie Deep Unit 18-4 drill site at Pelahatchie Field May 11th, 1998. More than 20 truckloads arrived yesterday, and more are scheduled to arrive today. Rig erection is to start May 13th, with the anticipation that actual drilling of the 17,300 ft Norphlet well will begin May 15th. It is anticipated that the well will take an estimated 90 days or less. Plans are to drill a 12 1/4'' hole to 5,100 ft, and set 9-5/8 surface casing. Following that procedure, an 8 3/4'' hole will be drilled to the next casing point which has been selected at 15,700-800 ft, in which 7'' casing will be set. The final 6'' hole to 17,300 feet will be sufficient to set 5'' casing from 15,700 to total depth expected at 17,300 ft. It was also announced today that the company has staked and is preparing the application to the Mississippi State Oil and Gas Board for two more 17,300 ft Norphlet wells anticipating the rig will be contracted to move from the first well to the offset locations.

To: Kerm Yerman who wrote (10643) 5/13/1998 1:28:00 AM From: Arnie   Respond to of 15196   CORP. / BelAir Energy Corp announces Appointment of Director CALGARY, May 12 /CNW/ - BelAir Energy Corporation announced today that Robert J. Engbloom has joined the Board of Directors of BelAir Energy Corporation. Mr. Engbloom is a partner with the Calgary law firm of MacKimmie Matthews where he has practiced corporate and securities law relating to public and private Corporations for over 23 years. ''The Board of Directors of BelAir is very active in providing advice and counsel to the management of BelAir'' said Vic Luhowy, President and CEO of BelAir, ''Bob Engbloom has extensive experience in corporate and securities law, in corporate financings and advisory work. His addition to our Board will complement the Board's capabilities in guiding BelAir's future growth.'' BelAir Energy Corporation is based in Calgary and is involved in the exploration and exploitation of petroleum reserves in Western Canada. BelAir is listed on The Alberta Stock Exchange and trades under the symbol ''BGY''.

To: Kerm Yerman who wrote (10643) 5/13/1998 1:30:00 AM From: Arnie   Respond to of 15196   SERVICE SECTOR / Canadian Fracmaster reports 1st 3 months Results CALGARY, May 12 /CNW/ - Canadian Fracmaster Ltd. announces its results for the three months ended March 31, 1998. Consolidated net earnings for the quarter were $6.4 million ($0.15 per share) on revenues of $109.6 million. This compares to earnings of $9.1 million ($0.21 per share) on revenues of $103.9 million in the first quarter of 1997. The decrease in consolidated earnings from the prior year of $2.7 million is attributable to the effects of lower oil prices and reduced production from the Company's Russian operations. Unfavourable foreign exchange movements between the Canadian and U.S. dollar also negatively impacted the Company's results. Consolidated funds from operations for the first three months of 1998 were $17.4 million ($0.40 per share) compared to $18.9 million ($0.44 per share) in the first quarter of 1997. The North American Well Services segment provides well stimulation, cementing, nitrogen, conventional coiled tubing services, and coiled tubing drilling applications to the Canadian and U.S. oil and gas industry, as well as industrial and pipeline services to oil and gas processing and transmission companies. Revenues from this segment reached an all-time high during the first quarter of 1998. For the three months ended March 31, 1998, the Well Services segment contributed earnings of $5.5 million on external revenues of $58.4 million, up from earnings of $5.2 million on external revenues of $44.4 million in the first quarter of 1997. On a comparative basis, North American Well Services revenues increased approximately 32% over the comparable three months of 1997, while earnings increased by about 6%. This improvement in results is attributable to continued high activity levels in Canada and the U.S., the continued growth of new service lines, improved pricing, and increased activity levels related to U.S. acquisitions. The outlook for 1998 remains positive. After spring break-up, the Company expects to see a continued shift towards gas-intent activity by the industry which should positively impact fracturing, acidizing and coiled tubing activity levels for Fracmaster. Also, the Company has just recently completed another acquisition in the U.S. which has effectively doubled the size of Fracmaster's operations there and positions the Company in the active South Texas drilling market. The Russian Joint Enterprise segment comprises the Company's proportionate share of Russian operating results, which to date are carried out primarily through its 50% owned Russian joint ventures. This segment contributed revenues of $45.0 million and produced earnings of $1.0 million in the first three months of 1998, compared to revenues of $55.2 million and earnings of $3.6 million in the first quarter of 1997. Earnings from the Company's Russian operations were down $2.6 million from the corresponding period of 1997, while revenues were off nearly 18%. The decline is attributable to the drop in oil prices, which on average were 22% lower than the first quarter of 1997. Also, as expected, oil production was approximately 12% lower, reflecting the Company's changing focus in Russia towards fee-for-service activity and away from equity-for-service. Fee-for-service revenues were up 80% compared to the first quarter of 1997. Fee-for-service activities are an emerging business sector for Fracmaster in Russia whereby the Company is paid in cash or cash equivalent for services performed. This is not a new business venture, but, rather, a new way to expand cash flow and earnings utilizing existing equipment capacity. During the first quarter of 1998, a total of 137 wells were fractured, all on a fee-for-service basis. In comparison, 116 such fractures were carried out in the corresponding period of 1997. In 1998, the Company will perform all fracture treatments on a fee-for-service basis and plans to expand the range of its fee-for-service operations to include cementing, acidizing and coiled tubing services. The Supply and Service segment comprises the Company's activities relating to the provision of materials, services, equipment and technology to the Russian Joint Enterprises, technical alliance partners and to third parties. Net earnings from the Supply and Service segment for the quarter were $0.6 million on external revenues of $4.5 million, as compared to $1.1 million of earnings on $4.3 million of external revenues in the first three months of 1997. Supply and Service results can vary significantly from period to period depending upon the timing of equipment, parts and chemical sales. Results can also be impacted by gains and losses resulting from foreign exchange fluctuations. In the first quarter of 1998, the Supply & Service segment reported foreign exchange losses of $0.5 million as compared to foreign exchange gains of $0.6 million in the comparable quarter of 1997. Canadian Fracmaster Ltd. is an international oil and gas service and production company which is listed on the New York Stock Exchange, the Toronto Stock Exchange and the Montreal Exchange and trades under the symbol ''FMA''. For further information on the Company, please visit our web site at fracmaster.com. << Quarter Ended March 31, ($ Million) 1998 1997 ---- ---- Revenues 109.6 103.9 Earnings before Interest, Income Taxes and Depreciation (EBITD) 22.5 25.2 Net Income 6.4 9.1 Net Income per Share $0.15 $0.21 Funds Flow from Operations 17.4 18.9 Funds from Operations per Share $0.40 $0.44 ---------------------------------------------------------------------- This press release contains forward-looking statements that are subject to risk factors associated with the oil and gas business. Fracmaster believes that the expectations reflected in this release are reasonable, but results may be affected by a variety of variables including, but not limited to, price fluctuations, currency fluctuations, drilling and production results of our customers and partners, industry competition, environmental risks, political risks and capital restrictions.

To: Kerm Yerman who wrote (10643) 5/13/1998 1:32:00 AM From: Arnie   Respond to of 15196   SERVICE SECTOR / IPEC Ltd reports 1st 3 months Results CALGARY, May 12 /CNW/ - IPEC Ltd. is pleased to report its financial results for the three months ended March 31, 1998 and for the year ended December 31, 1997. << (thousands of $CDN, unless Three Months Ended Year Ended noted) March 31 December 31 (unaudited) (audited) 1998 1997 1997 1996 ---------------------------------------------------------------------- Revenue 18,347 165 681 414 EBITDA 1,860 18 (64) (260) Net earnings (loss) 1,244 5 (163) (509) Working capital 5,652 120 429 58 Total assets 26,042 628 1,596 615 Long-term debt 1,640 1,001 1,321 945 Shareholders' equity (deficit) 11,815 (728) (488) (732) Earnings per share - fully diluted ($/share) 0.05 0.00 (0.04) (0.13) ----------------------------------------------------------------------- >> The first quarter of 1998 was a very active and successful period which culminated in the concurrent acquisitions of four synergistic oilfield services companies, closing an equity financing and changing our name from Locksley Capital Partners Inc. The acquisitions were effective January 1, 1998 and revenues for the three months ended March 31, 1998 were $18.3 million. Net earnings for the period were $1.2 million, or $0.05 per share, based an 29.5 million common shares outstanding on a fully diluted basis. The year 1997 was very significant for IPEC, and was highlighted by the acquisition of Chriscor Production Enhancement Technologies Inc. in November. This acquisition marked the completion of the first phase of the Company's strategic plan to acquire, consolidate and integrate complementary domestic and international oilfield services companies. Chriscor's historic activities had been focused on research and development related to the design and manufacture of downhole production optimization tools. Chriscor's results for 1997 improved from a net loss of $509,000 to a net loss of $163,000. Revenues for 1997 increased approximately 64% to $681,000 from $414,000 in 1996. The completion of the Phase Two acquisitions provides IPEC with a strong foundation to further advance its strategy of growth through acquisition and maximizing internal efficiencies. The Company has commenced Phase Three of its strategic plan which focuses on the acquisitions and consolidation of several small diameter pipeline construction companies in western Canada. IPEC Ltd. is an oilfield services company headquartered in Calgary, Alberta, with regional offices in Casper, Wyoming and Larnaca, Cyprus. The Company's current operations involve the domestic and international distribution of OCTG tubing and casing, drill pipe, line pipe, green tubes and structural steel products; the design, engineering and manufacture of oilfield surface equipment; and the design and manufacture of downhole production optimization tools.

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