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 CALGARY, Feb. 18 /PRNewswire/ -- The operations turnaround which began in 1991 continued throughout 1992, a year in which Gulf Canada Resources Limited (AMEX: GOU) took steps to position itself for improved results in the future.
 These steps included the withdrawal from Hibernia, the wind-up of northern drilling system lease obligations, discontinuation of the dividend on Gulf's ordinary shares, a provision regarding Home Oil and a reduction in the carrying value of the company's investment in Asamera Minerals Inc.
 In announcing the 1992 results, Chuck Shultz, president and chief executive officer, noted that the year included significant achievements:
 -- Increased total liquids production, from 92,600 barrels per day (bpd) to 96,800 bpd
 -- 40 per cent reduction in Western Canada finding and development costs
 -- one million barrels of crude oil production net to Gulf from its Russian joint venture
 -- resolution of Hibernia ownership
 Gulf announced a loss from continuing operations of $252 million ($1.85 per ordinary share). This loss was more than accounted for by one-time after-tax losses of $280 million, including the Hibernia write- off of $209 million after-tax, a provision regarding Home Oil and a reduction in the carrying value of Gulf's offshore drilling system. Excluding these non-recurring losses, earnings from continuing operations were $28 million, as results were positively affected by higher liquids sales, reduced costs, improved northern drilling system performance and a favorable tax settlement.
 In 1991, the company reported a loss of $27 million ($0.61 per ordinary share), which included a $90 million after-tax provision associated with the Hibernia withdrawal and a $60 million after-tax gain on the sale of Gulf's interest in the Caroline gas field. Excluding the non-recurring provision and gain, earnings from continuing operations were $3 million in 1991.
 Cash generated from continuing operations was $339 million, up $11 million from 1991 despite reduced oil and gas prices. Capital and exploration expenditures were $307 million compared with $308 million in 1991. Approximately one-third of Gulf's 1992 spending was related to its Hibernia project obligations which ended in early 1993.
 Losses from discontinued operations of $50 million in 1992 and $36 million in 1991 related primarily to reductions in Gulf's carrying value in Asamera Minerals Inc.
 Cash balances at the end of 1992 were $396 million, down $462 million from a year earlier largely as the result of repaying certain financial obligations, including:
 -- northern drilling system net debt of $140 million
 -- short-term debt of $155 million
 -- long-term debt of $52 million
 -- $90 million of other financing
 Operations achievements included:
 The operations turnaround which began in fourth quarter 1991 continued. Western Canada conventional crude oil production averaged 44,500 bpd in 1992, compared with 42,200 bpd in 1991. Total liquids production of 79,600 bpd
surpassed 1991 levels by five per cent. The increased production resulted from Gulf's strategy of focusing on quality fields in core areas, such as Sylvan Lake, Goose River and Stettler.
 Average 1992 gas production, at 319 million cubic feet per day (mmcf/d), was off only 19 mmcf/d from the previous year, despite the sale of properties in late 1991 that accounted for 70 mmcf/d production. Increases came from core areas including Strachan, Stettler and Fir.
 Gulf's northern drilling system went back to work in 1992. In the third quarter, the Kulluk and two icebreakers managed by Global Marine participated in drilling the successful ARCO Alaska Kuvlum-1 oil discovery well in the U.S. Beaufort Sea. Gulf has been selected as the contractor for ARCO's 1993 follow-up drilling program.
 Gulf increased its international liquids production to 17,200 barrels per day, compared with 16,800 barrels per day in 1991. At the same time, the company added over 10 million barrels of proved reserves in Indonesia and Russia, more than replacing production. Proved plus probable reserves increased 17 per cent in Indonesia, to 61 million barrels. Proved plus probable reserves in Russia more than doubled, to 16 million barrels.
 Gulf continued to expand its crude oil and natural gas operations in Indonesia. The company's share of crude oil production averaged 14,500 bpd. Declines from mature fields were partially offset by increased production from development in the Corridor Block, and from the Jambi EOR project, where Gulf's share of production more than doubled to almost 1,000 bpd since February when approvals were received for commercial development. Testing at the Dayung-2 delineation well in South Sumatra, in which Gulf has a 54 per cent interest,
confirmed the likelihood of a large gas field. Gulf believes that the Dayung gas, plus reserves from other recent discoveries at Gelam and Sambar, provides the threshold volumes required for development. In North Sumatra, two of three wells completed in the Block A drilling program tested gas. Drilling continues at a fourth well in the program.
 In Russia, the KomiArcticOil joint venture, in which Gulf is a 25 per cent partner, exported and sold two million barrels of crude oil in 1992. At year end, the joint venture had approximately two million barrels of production in inventory. Exports, which had been suspended in September, resumed in January 1993 with the export and sale of 830,000 barrels of oil.
 Consolidated Statements of Loss
 (Millions of dollars except per share amounts)
 Periods ended Dec. 31 Year ended
 1992 1991
 Net oil and gas $ 711 $ 786
 Net gain on asset disposals 35 133
 Other, including contract drilling 93 69
 Total 839 988
 Operating - production 329 329
 - contract drilling 47 69
 Exploration 54 79
 General and administrative 70 88
 Depreciation, depletion and amortization 240 215
 Reduction in carrying value of assets
 and other 372 160
 Finance charges, net 40 38
 Income tax expense (recovery) (61) 37
 Total 1,091 1,015
 Loss from continuing operations (252) (27)
 Discontinued operations (50) (36)
 Loss for the year $ (302) $ (63)
 Per ordinary share (see Note A)
 Loss from continuing operations $ (1.85) $ (0.61)
 Loss $ (2.16) $ (0.84)
 Condensed Consolidated Statements of Cash Flows
 Operating activities
 Cash generated from
 continuing operations $ 339 $ 328
 Other long-term liabilities (63) (115)
 Changes in non-cash working capital (66) 60
 Other, net (18) (5)
 Total 192 268
 Investing activities (198) 303
 Dividends (55) (108)
 Financing activities (401) 395
 Increase (decrease) in cash (462) 858
 Cash at beginning of period 858 0
 Cash at end of period (C) $ 396 $ 858
 NOTE: (C) Comprises cash and short-term investments
 Consolidated Statements of Financial Position
 (Millions of dollars)
 Periods ended Dec. 31 1992 1991
 Cash and short-term investments $ 396 $ 858
 Accounts receivable 183 122
 Other 77 90
 Total 656 1,070
 Investments, deferred charges and
 other assets 368 372
 Property, plant and equipment 2,360 2,484
 Total $ 3,384 $ 3,926
 Liabilities and Shareholders' Equity
 Short-term loans $ 94 $ 249
 Accounts payable 143 130
 Hibernia withdrawal costs 0 80
 Current portion of long-term debt 53 49
 Current portion of other long-term
 liabilities 29 70
 Other 63 68
 Total 382 646
 Long-term debt 1,570 1,478
 Other long-term liabilities 84 68
 Deferred income taxes 138 210
 Total 2,174 2,402
 Commitments and contingent liabilities
 Shareholders' equity
 Share capital
 Senior preference shares 577 577
 Ordinary shares 1,516 1,492
 Deficit (886) (520)
 Foreign currency translation adjustment 3 (25)
 Subtotal 1,210 1,524
 Total $ 3,384 $ 3,926
 A) The loss per ordinary share was calculated after deduction of cumulative preference share dividends of $48 million, $68 million and $105 million for 1992, 1991 and 1990, respectively.
 B) Certain amounts and volumes for 1991 and 1990 have been reclassified to conform with the presentation adopted for 1992.
 Supplementary Information
 Period ended Dec. 31 Year ended
 1992 1991
 Volumes produced
 Liquids (thousands of barrels per day)
 Western Canada
 Conventional crude oil 44.5 42.2
 Synthetic crude oil 15.9 14.9
 Natural gas liquids 19.2 18.7
 Total 79.6 75.8
 Indonesia 14.5 16.8
 Russia 2.7 -
 Total 17.2 16.8
 Total liquids 96.8 92.6
 Natural gas (millions of
 cubic feet per day) 319.1 338.1
 Volumes produced and sold (D)
 Total liquids (thousands of
 barrels per day) 91.4 88.9
 Natural gas (millions of
 cubic feet per day) 292.1 312.5
 NOTE: (D) Excludes reinjection requirements and includes inventory changes.
 Gross average prices
 Liquids (dollars per barrel)
 Conventional crude oil $ 21.84 $ 25.39
 Synthetic crude oil 23.11 23.14
 Natural gas liquids 15.71 16.60
 Indonesia 22.77 22.61
 Russia 19.11 -
 Average liquids 21.15 23.00
 Natural gas (dollars per thousand
 cubic feet) 1.35 1.47
 Average exchange rates (Cdn$1) US$0.83 US$0.87
 -0- 2/18/93
 /CONTACT: John Sparks, manager - public affairs of Gulf Canada Resources Limited, 403-233-4049/

CO: Gulf Canada Resources Limited ST: Alberta IN: MNG OIL SU: ERN

TM -- NY091 -- 8182 02/18/93 18:25 EST
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Date:Feb 18, 1993

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