Beau Canada Announces Results of Disposition Process.

CALGARY, ALBERTA--(BUSINESS WIRE)--Nov. 19, 1998--Beau Canada(TSE:BAU.) (ME:BAU.)

Beau Canada Disposition Highlights:

- Beau Canada sells $56 million of property, $16 million over previous target

- Bank debt expected to decline to $165 million

- Post dispositions: Beau's production will be 65 percent gas

- 1999 Production forecast revised to 120 mmcf/d of gas and 7,000 barrels/d of liquids

Beau Canada is pleased to announce the results of its asset disposition process. To date, purchase and sale agreements have been signed on five properties for total proceeds of $56 million, a 40 percent increase over the target amount of $40 million. Closings are expected by year-end and the proceeds will be used to repay bank debt, following which the Company will have approximately $50 million of credit lines available. Additional properties totalling $10 million may also be sold likely closing after year end.

Agreements have been signed for the sale of the Company's heavy oil property at Medicine Hat and four gas properties in Alderson, Cecil, Warspite and Weasel. The heavy oil property accounts for 55 percent of the reserves in the disposition package. The bulk of the dispositions are from southeast Alberta and as a result, the Company will be even more focused on the gas fairway it has targeted in west central and northern Alberta as well as northeast B.C. In 1999, Beau Canada expects gas will account for approximately 65 percent of production with heavy oil representing approximately 10 percent of production.

Beau Canada has sold heavy oil reserves at approximately $6.00/boe and gas reserves at approximately $10.00/boe all on a proven plus half probable basis. In total, the company has sold 7.1 million boe of reserves for approximately $7.85/boe or 2,600 boe/d of forecast 1999 production at a cost of $21,400 per boe/d.

As a result of the larger disposition package, the Company has revised its 1998 and 1999 forecasts. For 1998, due to the dispositions, Beau Canada now expects to average 91 mmcf/d of gas production and 8,300 barrels/d of liquids production totaling 17,400 boe/d, slightly below our previous forecast of 17,500 boe/d. In 1999, the Company expects to average 120 mmcf/d of gas production and 7,000 barrels/d of liquids production. The new 1999 estimates are approximately 10 percent below our previous forecast due to the increased size of the disposition package. As a result of acquisition and disposition activity in 1998, netbacks are expected to improve in 1999 as Beau Canada has increased its gas weighting and lightened its liquids quality mix.

Cash flow for 1998 is expected to be approximately $45 million ($0.45/share) rising to $68 million ($0.63/share) in 1999, a 40 percent increase on a per share basis. These forecasts are based on the following price assumptions; WTI - US $14.50 for 1998 and US $15.50 for 1999, Gas - Cdn $1.90/mcf for 1998 and Cdn $2.35/mcf for 1999. Capital expenditures for 1999 have been targeted at $75 - $80 million. Bank debt is expected to be reduced to $165 million by December, 1998 leaving debt to cash flow next year at 2.4 times.

This media release contains forward looking information. By its nature, this forward looking information involves risk and uncertainties that could cause actual results to differ materially from those contemplated by the forward looking information. The assumptions used in the preparation of such information, although considered reasonable by Beau Canada at the time of preparation, may be proved to be incorrect.

Beau Canada Exploration Ltd. is a Canadian oil and gas exploration and development company based in Calgary. Beau Canada's common shares are listed on The Toronto Stock Exchange and the Montreal Exchange under the symbol "BAU".

The Toronto Stock Exchange and The Montreal Exchange have neither approved nor disapproved information contained herein.