FPL First Calgary

    First Calgary Petroleums Ltd. and Sonatrach Announce MLE Field Development
Approval
     TSX: FCP
     AIM: FPL
     CALGARY, Feb. 19 /CNW/ - Sonatrach (Algeria's national oil company) and
partner First Calgary Petroleums Ltd. ("FCP" or the "Company") are pleased to
announce the receipt of approval from the Algerian regulatory authority ALNAFT
for the Development Plan for the MLE oil and gas field on Block 405b, located
in Algeria's Berkine Basin. Included as part of the Block 405b development
planning are a gas plant and field gathering system and facilities designed to
process 230 million cubic feet of raw gas per day on a gross basis and
associated natural gas liquids and oil. The plant capacity can be expanded to
treat up to 460 million cubic feet of raw gas per day.
     Block 405b will be developed in a staged process designed to maximize the
economic value of the block's reserves, commencing with the MLE field situated
on the eastern portion of the block. Block 405b also contains a number of oil
and gas discoveries situated west of the MLE field which will be layered in
upon completion of the block appraisal programme and approval of
commerciality.
     FCP and Sonatrach have recently signed a long term take or pay Gas
Marketing Agreement whereby Sonatrach will market the total natural gas
production from Block 405b. The marketing agreement is structured similarly to
standard natural gas long term supply agreements. No commercial arrangements
have been entered into in respect of the sale of liquids production; FCP's
share of production will be sold at world market prices.
     The MLE field will be developed for simultaneous dry gas and liquids
production with first production currently targeted for late 2009. Sonatrach
and FCP will form a joint operating group to design, build and operate the
production, processing and block tie-in facilities and pipelines. The initial
gross field reserves to be developed and recovered are 1.3 trillion cubic feet
of gas equivalent (approximately 230 million barrels of oil equivalent), with
dry gas and liquids (oil, condensates and liquefied petroleum gas) each
contributing approximately one half of total MLE production revenues. The
daily volumes for the MLE field over an initial 10 year flat plateau include
200 million cubic feet per day of dry gas under contract, along with liquids
of 21 thousand barrels per day while the plant, production and field gathering
facilities are being designed for expansion to 400 million cubic feet per day
of dry gas and associated natural gas liquids and oil to accommodate
additional production.
     The total gross estimated cost of the MLE development, including the
expanded plant and field gathering facilities, has been revised to
approximately US$1.3 billion reflecting the agreement of FCP and Sonatrach to
include the cost of the block tie-in pipelines as a joint development cost.
Consequently FCP will receive an increased share of production under the
Production Sharing Contract, providing an offset to the increased cost. Dry
gas and liquids pipelines are planned to be constructed by the joint venture
from Block 405b to a tie-in point on the national pipeline grid approximately
140 km west of the block. In addition, an oil pipeline is planned to be built
to a tie-in point on an existing oil pipeline in the Berkine Basin (PK0).
     The development cost will be mainly incurred over the 2007-2009 period
and be funded 75% by FCP and 25% by Sonatrach. The contract for the Front End
Engineering and Design (FEED) work has been tendered. It is expected the FEED
work will be completed and an Engineering, Procurement and Construction
contract will be tendered and awarded in 2007. Project costs will be refined
during the FEED process.
     Mr. Richard Anderson, President and Chief Executive Officer of FCP,
commented: "The joint development of the MLE field is a very important
milestone for FCP. We are delighted the project is moving ahead and thank our
partner Sonatrach and the Algerian authorities for their valuable assistance
and cooperation which has enabled the partnership to advance to this stage.
The Block 405b gas plant will be the first "cryogenic" liquids extraction
facility and gas export system in the Berkine Basin. The MLE field development
is a significant first step in the overall development of the block, and our
share of gas and liquids production revenues will provide a sound base for
meeting the Company's exciting future growth objectives. We look forward to
further development of the block when we have completed our ongoing appraisal
programme, and in addition are seeking new exploration opportunities."
     Notes:
     First Calgary Petroleums Ltd. is an oil and gas exploration company
actively engaged in international exploration and development activities in
Algeria. The Company's common shares trade on the Toronto Stock Exchange in
Canada (FCP) and on the AIM market of the London Stock Exchange in the UK
(FPL).
     FCP advises that in December 2006 the Algerian Government published a
further decree setting out the detailed rules for implementing the windfall
profits tax announced in July last year. The decree specifies that the new
tax, which will be calculated monthly, will apply when the monthly average
Brent oil price exceeds $30 per barrel.
     In its application to Block 405b, the rate of tax will be set by
reference to FCP's share of oil and gas production under our Production
Sharing Contract. The rate of tax commences at a rate of 5% where FCP's share
of production is 20,000 barrels of oil equivalent per day (boepd) or less,
rising in steps to 50% at levels where FCP's share is over 100,000 boepd. At
the initial contracted rate of gas production, together with the associated
liquids, for the MLE field as described above, the applicable rate of tax is
expected to be a maximum of 5% of production.
     As the new tax is in the early stages of its implementation, FCP and its
advisors are continuing to monitor and evaluate how the tax will be applied to
Block 405b in practice. Our Production Sharing Contract contains a
stabilization clause that protects our existing investment and related asset
value.
     This news release includes statements about expected future events and
financial results that are forward-looking in nature and subject to risks and
uncertainties. FCP cautions that actual performance may be affected by a
number of factors, many of which are beyond its control. Future events and
results may vary substantially from what First Calgary Petroleums Ltd.
currently foresees.
For further information: First Calgary Petroleums Ltd.: Richard G. Anderson,
President and CEO, Tel: (403) 264-6697; John van der Welle, Finance Director
and CFO, Tel: +44 (0) 203 043 0270; Other Contacts: Jonathan Naess, Nabarro
Wells & Co. Limited, Tel + 44 (0) 207 710 7400; James Henderson, Pelham Public
Relations, Tel: +44 (0) 207 743 6673; Carina Corbett, 4C - Burvale Limited,
Tel: +44 (0) 207 559 6710
(FPL)



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