This is an important milestone in the emergence of THAI technology. It is been applied to an ordinary heavy oil field with a fairly typical thickness. The results here should go a long way in the development of similar fields elsewhere. The tarsands have unique features that need to be clarified when applied to more conventional heavy oil fields.

You can bet that the gravity will be quite high for this field and that THAI will be sufficient in itself to free the oil and upgrade it enough to pump.

The sooner we know how to apply this technology the better. We still need to find several millions of barrels of oil production ASAP.

CALGARY _ Petrobank Energy and Resources Ltd. (TSX:PBG) and True Energy Trust (TSX:TUI.UN) say they plan to develop a heavy oil resource in Saskatchewan together using Petrobank´s patented oil extraction technology.

Under an agreement announced Friday, Calgary-based Petrobank will hold a 50 per cent interest in three sections of True´s Kerrobert Mannville oil pool.

Petrobank d an oil recovery method called Toe to Heel Air Injection, or THAI, in which air is pumped into hard-to-access reservoirs. The process uses the air and the bitumen itself to heat the thick, tarry substance and make it thin enough to flow to the surface.Unlike other oil extraction technology, the THAI process does not require water or large quantities of natural gas to keep the operations going.

Petrobank and True aim to developed a two-well project to demonstrate the THAI technology in the more than 10-metre thick conventional oil reservoir.

Petrobank will also earn a 10 per cent technology royalty on True´s share of THAI production following a threshold reserve recovery.

"Petrobank is excited about the opportunity to partner with True and bring the THAI technology to the conventional heavy oil resource base in Saskatchewan" the company said in a statement.

"This is indeed a welcome announcement, particularly in these uncertain economic times, and a vote of confidence in the future of Saskatchewan´s energy sector," Saskatchewan Premier Brad Wall stated.

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