MAJOR ETHANOL PLANT FOR LLOYDMINSTER

Released on February 16, 2004

Premier Lorne Calvert today said a major step has been taken toward development of a biofuels industry in Saskatchewan, with the announcement by Husky Energy that they intend to proceed with construction of a 130 million litre ethanol facility in Lloydminster.

The announcement on the facility for Lloydminster was made today in Regina by John Lau, President and Chief Executive Officer of Husky Energy, and Premier Calvert. The Lloydminster plant is projected to cost between $90-$95 million, and is expected to be operational by the end of 2005.

"Our primary goal with the 2002 Greenprint plan was the establishment of a growing biofuels industry for Saskatchewan," Calvert said. "Today's announcement takes us a giant step closer to our goal. It means jobs. It means clean fuel and clean livestock feed. It means value-added agriculture along with increased stability and growth in rural Saskatchewan. I am extremely pleased to see this expansion of Husky's operation in our province."

"Husky Energy is committed to continually improving fuel quality and expanding its operations to meet consumer demand," President & Chief Executive Officer of Husky Energy Mr. John C.S. Lau said.

"Husky's goals for this expansion are to make cleaner fuels and to provide ethanol for the refining industry. This initiative will also support our current program of ethanol-blended fuels marketed under our Mother Nature's Fuel brand," Mr. Lau said.

It is expected the facility will be constructed next to Husky's Heavy Oil Upgrader in Lloydminster. Husky is already marketing ethanol-blended fuel through its Mohawk and Husky service stations in Canada, and the Lloydminster facility will help to meet that demand.

Calvert said the expansion in biofuels is also consistent with the Government's goal of a green and sustainable economy. "We've created a climate for economic growth in Saskatchewan, and we'll continue to build on our strengths. One of the objectives of Greenprint was to do so in an environmentally responsible way. This project clearly fits the bill."

Saskatchewan has the lowest-cost feedstocks in Canada for ethanol production, giving the province a competitive advantage in the industry. Saskatchewan was also the first province in Canada to make a legislative commitment to ethanol use.

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For More Information, Contact:

Janet Peters Industry and Resources Regina Phone: (306) 787-8277

Dennis C. Floate Husky Energy Inc. Calgary Phone: (403) 298-6587