CALGARY, Nov. 6 /CNW/ - Connacher Oil and Gas Limited (CLL - TSX)
announces that it has been advised that the Lieutenant Governor in Council, by
Order in Council Number 525/2008, dated November 5, 2008, has authorized the
Energy Resources Conservation Board ("ERCB") to grant Approval No. 11253
("Approval") to Connacher Oil and Gas Limited ("Connacher"), approving
Connacher's application No. 1515981 to proceed with development of its Algar
10,000 bbl/d steam assisted gravity drainage ("SAGD") oil sands project in
northeastern Alberta.
    This Order in Council represents the last formal requirement enabling the
ERCB to issue the Approval for Connacher to proceed. During the construction
and pre-startup phases, Connacher will obviously remain in close contact with
and work with the relevant regulatory authorities to secure all necessary
permits and to meet the requirements as will be set forth in the Approval.
    The Approval marks the culmination of approximately seventeen months of
review of the project by the ERCB, stakeholders and other governmental
departments, including Alberta Environment ("AENV") and Alberta Sustainable
Resource Development ("ASRD").
    Accordingly, upon receipt of the Approval from the ERCB, Connacher
intends to proceed immediately with the construction of a road into the
proposed plant site, preparation of the plant site and construction of three
planned well pads. This will be followed by the drilling of the first fifteen
SAGD well pairs for steam injection and bitumen production. Assuming no
unusual delays caused by weather or other factors, Connacher anticipates
startup of the completed plant and facilities and the commencement of steam
injection before the end of 2009, with first regular production of bitumen
anticipated during the second quarter of 2010. The ramp up to the anticipated
output of 10,000 bbl/d of bitumen is expected to occur throughout 2010.
    To date, Connacher has already spent or committed approximately $120
million for long lead items and for construction of key plant components for
the Algar project. Accordingly, based on recent budgeting and excluding
contingencies, which have been budgeted at $30 million, approximately $225
million remains to be invested to complete Algar. Connacher has already
secured the necessary funding to complete the project.
    As reflected in expenditures and commitments to date, substantial
progress has already been made on engineering and design work, shop
construction of major equipment, mechanical and civil design work, electrical
design and drafting and processing and instrument design and equipment
ordering, drawing on key learnings and the company's experience at Great
Divide Pod One.
    Connacher anticipates utilizing the services of substantially most of the
same key suppliers and construction personnel that successfully built the Pod
One plant on schedule throughout the winter of 2006-2007.

    Connacher Oil and Gas Limited is a Calgary-based crude oil, bitumen and
natural gas company which employs an integrated strategy in its oil sands
operations. Its principal asset is a 100 percent ownership in a significant
bitumen reserve and resource base and in additional undeveloped acreage in the
Great Divide and Halfway Creek regions of Alberta, where it also operates the
10,000 bbl/d Pod One project. Connacher owns a 9,500 bbl/d heavy oil refinery
in Great Falls, Montana and also owns conventional hydrocarbon reserves and
produces crude oil and natural gas in Alberta and Saskatchewan. The company
maintains a 24 percent equity interest in and is the largest shareholder of
Petrolifera Petroleum Limited, a public company listed for trading on the
Toronto Stock Exchange and active in the oil business in Argentina, Peru and
Colombia.

    Forward-Looking Information:

    This press release contains "forward-looking information" including:
planned construction of the Algar project, timing for completion of
construction and start-up, target production output from Algar based on design
capacity and anticipated remaining capital requirements for Algar.
Forward-looking information is frequently characterized by words such as
"plan", expect", "project", "intend", "believe", "anticipate", estimate",
"may", "will", "could", "potential", "proposed" and other similar words, or
statements that certain events or conditions "may" or "will" occur. These
statements are only predictions. Forward-looking information is based on the
opinions and estimates of management at the date the statements are made, and
are subject to a variety of risks and uncertainties and other factors that
could cause actual events or results to differ materially from those projected
in the forward-looking statements. These factors include the inherent risks
involved in the exploration and development of oil sands properties,
difficulties or delays during construction and in start-up operations, the
uncertainties involved in interpreting drilling results and other geological
data, fluctuating oil and prices, fluctuating differentials, the possibility
of unanticipated costs and expenses, uncertainties relating to the
availability and costs of financing needed in the future, general economic
conditions and other factors including unforeseen delays. As an oil sands
enterprise in the development stage, Connacher faces risks including those
associated with exploration, development, construction, start-up, approvals
and the continuing ability to access sufficient capital from external sources
if required. For a description of the risks and uncertainties facing Connacher
and its business and affairs, readers should refer to Connacher's Annual
Information Form for the year ended December 31, 2007, which is available at
www.sedar.com. Connacher undertakes no obligation to update forward-looking
statements if circumstances or management's estimates or opinions should
change, unless required by law. Due to the risks and uncertainties inherent in
forward-looking information, the reader is cautioned not to place undue
reliance on this forward-looking information.