OIL SANDS DEVELOPMENT: British Petroleum inks two deals

ALBERTA - British Petroleum (BP) of London, UK, is expanding its presence in the oil sands industry north of Fort McMurray with the signing of two development deals.

On March 11, 2010, BP and Devon Energy of Oklahoma City, signed a deal to create a joint venture for development of the Kirby oil sands project. Devon is selling all its deepwater oil and gas interests to BP for US$7.0 billion, giving the company the cash to acquire 50% of BP's Kirby oil sands leases. These leases are near Devon's Jackfish steam assisted gravity drainage (SAGD) project. Devon will be the operator of the Kirby project, which will likely be a multi-stage SAGD development. See also www.DevonEnergy.com.

On March 15, 2010, BP and Value Creation Inc. (VCI) of Calgary signed a deal for the development of VCI's Terre de Grace oil sands leases that cover almost 75,000 ha. Neither company has released a value for their deal, but BP will take a minority position and act as operator, making what VCI calls a "significant" capital investment. Again, the use of SAGD technology is planned. More about the Terre de Grade leases is available at www.VCtek.com.