Canada Southern Petroleum- Kotaneelee L-38 Well Commences Production.

CALGARY, Alberta -- Canada Southern Petroleum Ltd. (the "Company") (TSX:CSW) (NASDAQ:CSPLF) (BOSTON:CSW) (PCX:CSPLF) today announced that the Kotaneelee L-38 development well has been tied in and has commenced production.

The Company is pleased to announce that the well has been flowing for the last 7 days and has stabilized at a rate of approximately 17 million cubic feet per day (mmcf/d). The Company expects that this will result in sales volumes, after shrinkage, of 12.8 mmcf/d, of which the Company's net share is 4 mmcf/d or approximately 665 barrels of oil equivalent per day (boe/d).

This initial sales volume provides an increase of approximately 70% over 2005's first quarter average, which was 929 boe/d. The Company cautions that this initial rate may not be indicative of future rates.

Based on the information currently available, the Company is not yet able to estimate reserve additions for this well. The operator plans to perform a production test this summer. The Company will submit the results of the testing to its independent reserves evaluator who will prepare an estimate of recoverable proven reserves, if any, using the standards of Canadian National Instrument 51-101.

Canada Southern Petroleum Ltd. is an independent energy company based in Calgary, Alberta, Canada. The Company is engaged in oil and gas exploration and development, with its primary interests in producing properties in the Yukon Territory and British Columbia, Canada. The Company's common shares are traded on the NASDAQ SmallCap Market and the Pacific Exchange, Inc. under the symbol "CSPLF," and on the Toronto Stock Exchange and Boston Stock Exchange under the symbol "CSW". The Company has 14,417,770 shares outstanding.

This document contains certain forward-looking statements relating, but not limited, to operations, financial performance, business prospects and strategies of the Company. Forward-looking information typically contains statements with words such as "anticipate", "believe", "expect", "plan", "intend" or similar words suggesting future outcomes or statements regarding an outlook on, without limitation, commodity prices, estimates of future production, the estimated amounts and timing of capital expenditures, anticipated future debt levels and royalty rates, or other expectations, beliefs, plans, objectives, assumptions or statements about future events or performance.

Shareholders are cautioned not to place undue reliance on forward-looking information. By its nature, forward-looking information of the Company involves numerous assumptions, inherent risks and uncertainties both general and specific that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur. These factors include, but are not limited to: the pricing of natural gas and oil; the effects of competition and pricing pressures; risks and uncertainties involving the geology of natural gas and oil; operational risks in exploring for, developing and producing natural gas and oil; the uncertainty of estimates and projections relating to production, costs and expenses; the significant costs associated with the exploration and development of the properties on which the Company has interests, particularly the Kotaneelee field; shifts in market demands; risks inherent in the Company's marketing operations; industry overcapacity; the strength of the Canadian economy in general; currency and interest rate fluctuations; general global and economic and business conditions; changes in business strategies; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserves estimates; various events which could disrupt operations, including severe weather conditions, technological changes, our anticipation of and success in managing the above risks; potential increases in maintenance expenditures; changes in laws and regulations, including trade, fiscal, environmental and regulatory laws; and health, safety and environmental risks that may affect projected reserves and resources and anticipated earnings or assets. See also the information set forth under the heading "Information Concerning the Oil and Natural Gas Industry" in our 2004 Annual Information Form. Statements relating to "reserves" are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future.

We caution that the foregoing list of important factors is not exhaustive. We undertake no obligation to update publicly or revise the forward-looking information provided in this document, whether as a result of new information, future events or otherwise, or the foregoing list of factors affecting this information.

Canada Southern Petroleum Ltd. (TSX:CSW) (NASDAQ:CSPLF)