PRESS RELEASE - Gulf Indonesia announces initialing of gas sales agreement for supply of natural gas to Singapore

Gulf Indonesia Resources Limited (GRL: NYSE), a 72 per cent owned subsidiary of Gulf Canada Resources Limited (GOU: TSE, ME, NYSE), announced today that Indonesia's state owned oil and gas company Perusahaan Minyak Dan Gas Bumi Negara (``Pertamina'') and Gas Supply Private Limited, an indirect, wholly owned subsidiary of Singapore Power, have initialed a detailed gas sales agreement and supporting schedules. It is expected that the Gas Sales Agreement together with all supporting agreements including the gas supply and transportation agreements and agreements between Gas Supply Private Limited and its end users will be executed on or before November 15, 2000. This Gas Sales Agreement will be the second major gas agreement signed by Pertamina and a Singaporean company

The gas to be sold by Pertamina will be supplied from three production-sharing contracts (``PSCs'') in Sumatra. Two of the PSCs, the Corridor Block and the South Jambi B Block, are operated by Gulf Indonesia subsidiaries, while the third, the Jabung Block, is operated by a third party. The three PSCs will supply 150 million cubic feet per day (MMSCFD) of gas beginning in 2003 and increasing to a peak rate of 350 MMSCFD by 2009 for a total contract period of 20 years. ``The project is of strategic importance to Singapore as it provides security of gas supply from South Sumatra and is a priority for Indonesia as it generates foreign exchange. All sides are working together towards finalizing all documents by mid-November'' says Bill Fanagan President and CEO of Gulf Indonesia.

Sawangan - 1X Plugged and Abandoned

Gulf Indonesia has completed the drilling of Sawangan - 1X exploration well (100% Gulf Indonesia) in the East Java Sea. The well reached TD of 10,204 ft in pre-tertiary basement. The overlying section of the objective sands were present but were water bearing. Minor oil shows in the drill cuttings and hydrocarbon shows on the well logs indicate the presence of a petroleum system in the region and data received from this well are now being used to evaluate other major prospects in the area. Fanagan said, ``The Sawangan well is the first of our big-hit exploration program in the East Java Sea and verified that there is a petroleum system in the region. We will be spudding our next well in the program, Bukit Panjang, in the Ketapang block in October of this year''.

Gulf Indonesia holds a 54 per cent working interest in the Corridor Block PSC and is contract operator for Pertamina, the Indonesian state oil company. Partners are Talisman (Corridor) Ltd. (a subsidiary of Talisman Energy Inc.) with 36 per cent and Pertamina with 10 per cent. Gulf Indonesia also holds a 45 per cent working interest in and operates the South Jambi B Block PSC. Partners are Santa Fe with 30 per cent and Pertamina with 25 per cent.

This release contains forward-looking statements within the meaning of Section 27A of the United States Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although Gulf Indonesia believes that its expectations are based on reasonable assumptions, these assumptions are subject to a wide range of business and technical risks, and there is no assurance Gulf Indonesia's objectives will be achieved.

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