##### 



Exhibit 1

HUSKY ENERGY INC.

RENEWAL ANNUAL INFORMATION FORMFor the Year Ended December 31, 2002

March 26, 2003





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TABLE OF CONTENTS

|                                                                                      |  |      |    | 
|------------------------------------------------------------------------------------- |  | ---- | -- | 
|                                                                                      |  | Page
|                                                                                      |  |     
|Abbreviations                                                                         |  |      | 3  | 
|Husky Energy Inc.                                                                     |  |      | 4  | 
|Subsidiaries of Husky                                                                 |  |      | 4  | 
|History and development of Husky                                                      |  |      | 5  | 
|Business of Husky                                                                     |  |      | 7  | 
|Human resources                                                                       |  |      | 37 | 
|Selected consolidated financial information                                           |  |      | 37 | 
|Managements discussion and analysis of financial condition and results of
operations |  |      | 38 | 
|Market for securities                                                                 |  |      | 38 | 
|Directors and Officers                                                                |  |      | 38 | 
|Dividend policy                                                                       |  |      | 43 | 
|Additional information                                                                |  |      | 43 | 
|Special note regarding forward-looking statements                                     |  |      | 43 | 

2



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ABBREVIATIONS

As used in this Annual Information Form, the following terms have the meanings
indicated:

|          |  |                                         |  | 
|--------- |  | --------------------------------------- |  | 
|API       |  | - American Petroleum Institute         
|bbl       |  | - barrel                               
|bbls      |  | - barrels                              
|mbbls     |  | - thousand barrels                     
|mmbbls    |  | - million barrels                      
|mcf       |  | - thousand cubic feet                  
|mmcf      |  | - million cubic feet                   
|bcf       |  | - billion cubic feet                   
|mcfge     |  | - thousand cubic feet of gas equivalent
|mlt       |  | - thousand long tons                   
|NGL       |  | - natural gas liquids                  
|boe       |  | - barrels of oil equivalent            
|boe/day   |  | - barrels of oil equivalent per day    
|bbls/day  |  | - barrels per day                      
|mbbls/day |  | - thousand barrels per day             
|mmcf/day  |  | - million cubic feet per day           
|lt/day    |  | - long tons per day                    
|mlt/day   |  | - thousand long tons per day           
|MW        |  | - megawatts                            

Unless otherwise noted, gross reserves or gross production are reserves or
production attributable to Huskys interest prior to deduction of royalties;
net reserves or net production are reserves or production net of such
royalties. Gross or net production reported refers to sales volume, unless
otherwise indicated. Natural gas volumes are converted to a boe basis using the
ratio of six mcf of natural gas to one bbl of oil and natural gas liquids.
Natural gas volumes are stated at the official temperature and pressure basis
of the area in which the reserves are located.

3



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HUSKY ENERGY INC.

Husky Energy Inc. (Husky Energy) was incorporated under the Business
Corporations Act(Alberta) on June 21, 2000. From the date of its
incorporation until August 25, 2000, Husky Energy did not carry on any
business. On August 25, 2000, Husky Energy was a party to a plan of
arrangement under the Business Corporations Act(Alberta) (the Arrangement)
pursuant to which Husky Oil Limited (Husky Oil), Husky Oil Operations Limited
(a subsidiary of Husky Oil) and Renaissance Energy Ltd. (Renaissance) were
amalgamated under the Business Corporations Act(Alberta) and continued as one
corporation under the name Husky Oil Operations Limited (HOOL) and the
securityholders of Renaissance and Husky Oil exchanged their securities for
securities of Husky Energy. Under the Arrangement, Husky Energy acquired 100%
of the common shares of HOOL.

Husky Energy has its registered office and its head and principal office at 707
- 8th Avenue S.W., P.O. Box 6525, Station D, Calgary, Alberta, T2P 3G7.

In this Annual Information Form the term Husky or the Company means Husky
Energy and its subsidiaries and partnership interests on a consolidated basis
including information with respect to predecessor corporations.

SUBSIDIARIES OF HUSKY

The principal subsidiaries of Husky and place of incorporation, continuance or
place of organization, as the case may be, are as follows. All of the
following companies are directly or indirectly 100% owned.

|                                               |  |              |  | 
|---------------------------------------------- |  | ------------ |  | 
|Name                                           |  | Jurisdiction
|                                               |  |             
|Subsidiaries of Husky Energy Inc.              |  |              |  | 
|Husky Oil Operations Limited                   |  | Nova Scotia 
|Subsidiaries of Husky Oil Operations Limited   |  |              |  | 
|Husky Oil Limited                              |  | Canada      
|Husky Energy Marketing Inc.                    |  | Alberta     
|Husky (U.S.A.) Inc.                            |  | Delaware    
|HOI Resources Co.                              |  | Nova Scotia 
|Husky Energy International Sulphur Corporation |  | Alberta     
|147212 Canada Ltd.                             |  | Canada      
|Subsidiaries of Husky (U.S.A.) Inc.            |  |              |  | 
|Husky Gas Marketing Inc.                       |  | Delaware    
|Subsidiaries of HOI Resources Co.              |  |              |  | 
|Husky Energy International Corporation         |  | Alberta     

4



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|                                                       |  |              |  | 
|------------------------------------------------------ |  | ------------ |  | 
|Name                                                   |  | Jurisdiction
|                                                       |  |             
|Subsidiaries of Husky Energy
International Corporation |  |              |  | 
|Husky Oil China Ltd.                                   |  | Alberta     
|Husky Oil (Madura) Ltd.                                |  | Alberta     
|Husky Oil Overseas Ltd.                                |  | Alberta     

HISTORY AND DEVELOPMENT OF HUSKY

The following describes the development of Huskys business over the last three
years.

Effective January 1, 2000, Husky exchanged interests in the Terra Nova oil
field and White Rose oil field, located in the Jeanne dArc basin off the east
coast of Newfoundland, for producing properties in Alberta. Under the terms of
the agreement Husky acquired working interests in the Valhalla and Wapiti
fields which produce crude oil, natural gas liquids and natural gas. The
properties are located in West Central Alberta near Grande Prairie. In exchange
Husky gave up a 4.99% interest in the Terra Nova field and 10% of the White
Rose field. Husky retained 12.51% of Terra Nova and 72.5% of White Rose. Terra
Nova commenced production in January 2002 and the White Rose development
project was sanctioned in March 2002.

In May 2000, Husky redeemed U.S. $71 million (Cdn. $104 million as at that
date) of its 8.45% Senior Secured Bonds as a result of the reduction of the
ownership interest in the Terra Nova oil field. The amount of the redemption
coincided with the reduction of Huskys interest from 17.5% to 12.51%.

On June 18, 2000, Husky Oil and Renaissance entered into an agreement that
contemplated the merger of Renaissance and Husky Oil pursuant to a plan of
arrangement under the provisions of the Business Corporations Act(Alberta).
Renaissance was a publicly listed senior oil and gas exploration and
development company conducting operations primarily in Western Canada.
Pursuant to the arrangement, shareholders of Renaissance received one common
share of Husky and a cash payment of $2.50 per share as well as the right to
participate in a buyback of approximately 18% of the common shares of
Renaissance by shareholders of Husky Oil. Former shareholders of Husky Oil
received approximately 71.7% of the common shares of Husky and former
shareholders of Renaissance received approximately 28.3% of the common shares
of Husky. Pursuant to the arrangement, Husky Oil, Renaissance and Husky Oil
Operations Limited amalgamated to form HOOL. Also pursuant to the arrangement,
Husky disposed of certain non-energy related assets to the former shareholders
of Husky Oil. The arrangement was completed on August 25, 2000 and Huskys
common shares commenced trading on the Toronto Stock Exchange on August 28,
2000.

In July 2000, Husky Oil repaid U.S. $116 million of its 10.6% senior notes to
retire the issue. The repayment was funded under Husky Oils syndicated credit
facility.

On October 13, 2000, Husky Oil China Ltd., a subsidiary of Husky signed a
petroleum contract with the China National Offshore Oil Corporation (CNOOC)
to develop two high quality oilfields in the South China Sea. The Wenchang 13-1
and 13-2 fields are located in the western Pearl River Mouth Basin,
approximately 300 kilometres south of Hong Kong and 136 kilometres east of
Hainan Island. Husky holds a 40% interest in these fields. At December 31,
2002, Huskys share of gross proved reserves was 30.1 mmbbls of light crude
oil.

In December 2000, Husky expanded its acreage position offshore Newfoundland
with the acquisition of a 100% working interest in the Grand Bank (339 square
kilometres) and Gros Morne (201 square kilometres) Exploration Licenses south
and west of the White Rose

5



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Significant Discovery Area. The Grand Bank and Gros Morne Exploration Licenses
form a large contiguous exploration area with the Trepassey (100% working
interest) and North Amethyst (70% working interest) blocks and the White Rose
Significant Discovery Area.

In December 2000, Husky acquired two Exploration Licenses comprising 1,087,000
acres in the South Whale Basin, a new exploration area on the southern Grand
Banks. The regional setting of the South Whale Basin is similar to that of
the proven hydrocarbon-bearing Jeanne dArc and Sable Basins.

In late 2000, Husky acquired a 50% working interest in an adjacent lease to the
north of its Kearl lease in east central Alberta where Husky held a 51% working
interest.

In January 2001, Husky amended and restated its Canadian syndicated $1 billion
bank facility.

On July 4, 2001, Husky acquired all of the outstanding Class A Common Shares
and Class B Common Shares of Avid Oil & Gas Ltd. (Avid), which it did not
already own, pursuant to an offer to purchase dated March 23, 2001. The
acquisition of Avid was completed pursuant to a Pre-Acquisition Agreement which
provided for the acquisition of the Class A Common Shares of Avid at a price of
$5.85 per share and the Class B Common Shares of Avid at a price of $10.00 per
share for a total consideration of approximately $82.6 million. Husky had
previously owned approximately 38% of the Class A Common Shares of Avid as a
result of the acquisition of Renaissance in August 2000.

By December 2001 the White Rose project had received government sanction from
the Canada-Newfoundland Offshore Petroleum Board and the Provincial and Federal
governments. In March 2002, Husky and its co-venturer announced that they had
decided to proceed with the development of the White Rose oil field.

The Terra Nova development project commenced production in January 2002. This
project was the first Grand Banks field to be developed with a floating
production, storage and offloading system. The first well in the Far East block
was successfully drilled in 2001. Huskys share of production from Terra Nova
averaged 13,200 barrels of oil per day in 2002.

In June 2002, Husky issued U.S. $400 million of 6.25% senior notes due June 15,
2012. The notes were sold at a price of 99.545% per note to yield 6.312%. The
notes were issued under a U.S. $1 billion base shelf prospectus dated June 6,
2002. The proceeds were used to repay existing bank indebtedness and for
general corporate purposes.

On July 7, 2002, the Wenchang oil fields, 13-1 and 13-2, produced first oil.
The oil fields produce light crude oil similar to the benchmark Minas blend
from two production platforms into a floating production, storage and
offloading vessel stationed between the two fields.

In September 2002, Husky signed contracts for two exploration leases in the
South China Sea. The 23/15 lease comprises 1,327 square kilometres and the
23/20 lease comprises 1,543 square kilometres. The contracts require one well
to be drilled on each lease within three years.

In November 2002, Husky announced a significant discovery of natural gas at
Shackleton, Saskatchewan. The Company announced that development of the
Shackleton area could add 250 bcf to proved reserves within two to three years.
Husky held more than 400 sections of land comprising 300,000 acres in this area
at year-end.

In December 2002, Husky signed a contract for the 40/30 exploration block in
the South China Sea. The block comprises approximately 6,704 square kilometres
and the contract requires one well to be drilled within three years.

6



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In December 2002, Husky swapped, with its co-venturer, its working interest in
the mining portion of its Kearl oil sands property for its co-venturers
interest in the in-situ portion of the property. As a result Husky now holds
100% working interest in 16,000 acres of lands with in-situ potential.

BUSINESS OF HUSKY

Husky is a publicly held integrated energy and energy related company
headquartered in Calgary, Alberta. Huskys operations include the exploration
for and development of crude oil and natural gas properties, as well as the
production, purchase, transportation, storage and marketing of crude oil,
natural gas, natural gas liquids, sulphur and petroleum coke, and the upgrading
and refining of crude oil and marketing of refined petroleum products,
including gasoline, diesel, alternative fuels and asphalt products.

Upstream Business

Huskys portfolio of assets includes properties that produce light, medium and
heavy gravity crude oil, NGL, natural gas and sulphur. As operator of the
majority of its properties Husky exercises a high degree of control in its
upstream operations. Husky has significant production, gathering and processing
facilities throughout the Western Canada Sedimentary Basin. In the Lloydminster
heavy oil prone area Husky has a well established position with extensive and
concentrated landholdings, producing, gathering and processing facilities as
well as heavy crude oil pipeline, upgrading and refining facilities.

At December 31, 2002, Husky was the operator of properties which accounted for
approximately 87% of its total working interest production in Western Canada.
Huskys undeveloped landholdings in the Western Canada Sedimentary Basin
totalled 7.2 million net acres at December 31, 2002.

In the foothills deep basin areas in Alberta Husky operates the Ram River gas
plant and has interests in properties that feed the plant including:
Blackstone, Ricinus, Limestone, Clearwater, Benjamin, Brown Creek and Stolberg.
Husky also has an interest in the Caroline gas plant and field. Further north
Husky has interests in the Valhalla and Wapiti crude oil and natural gas fields
near Grand Prairie and properties in the Edson area. In north-eastern British
Columbia, Husky holds natural gas interests in the Sikanni and Federal area as
well as Boundary Lake.

In the plains region of north-west Alberta Husky operates the Rainbow Lake
Plant, miscible floods and properties in surrounding areas. Husky has extensive
interests in the Peace River Arch, Boyer, Sloat Creek, Marten Hills, Cherpeta
and Simons Lake areas. In the east central region of Alberta Husky has
extensive property holdings east of Calgary and around Red Deer and Edmonton
including major properties at Hussar and Provost.

In southern Alberta and Saskatchewan Husky has extensive property holdings
around Taber, Brooks, Jenner and Suffield in southern Alberta and primarily
throughout south-western Saskatchewan at Shackleton, Cantaur, Fosterton and
Carnduff.

Husky has extensive experience in development, production, transportation and
upgrading of heavy crude oil. Husky also has considerable experience and
expertise in enhanced recovery of crude oil and horizontal drilling, as well as
in natural gas exploration in the foothills along the Canadian Rocky Mountains.

On the east coast of Canada Husky
holds a 12.51% working interest in the Terra
Nova oil field, which began producing light crude oil in January 2002, and a
72.5% working interest in the White Rose oil field, which was sanctioned in
March 2002 and is currently under development.

7



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First oil at the White Rose oil field is currently expected prior to the end of
2005. Husky also holds interests in several exploration and significant
discovery licenses in the Jeanne dArc Basin.

Husky holds a 40% working interest in the Wenchang oil fields located offshore
in the South China Sea. Production at the Wenchang oil fields began in July
2002. Husky also holds interests in several exploration blocks in the South
China Sea

Midstream Business

Huskys midstream operations include upgrading of heavy crude oil feedstock
into synthetic crude oil, pipeline transportation and processing of heavy crude
oil, storage of crude oil, diluent and natural gas, and cogeneration of
electrical and thermal energy, and marketing of Huskys and third party
produced crude oil, natural gas, natural gas liquids, sulphur and petroleum
coke.

Refined Products Business

Huskys refined products operations include refining of heavy and light crude
oil, marketing of refined petroleum products, including asphalt and alternate
fuels, and processing of grain primarily for ethanol production. Husky sells
and distributes transportation fuels including ethanol blended fuels through
571 independently operated Husky and Mohawk branded petroleum outlets,
including service stations, truck stops and bulk distribution facilities
located from the west coast of Canada to the eastern border of Ontario, some of
which include 24 hour restaurants, convenience stores, service bays, car
washes, fast food sales, bank machines and propane sales.

Upstream Operations

Production

The following table shows Huskys average gross and net daily production of
crude oil and NGL and natural gas for the periods indicated.

|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|------------------------------------- |  | ------------------ | ----- | -------- |  | --------- | ----- | -------- |  | ----------- | ----- |  |  |  | ----- |  |  |  | ----- | 
|                                      |  | Three Months Ended
|                                      |  |                   
|                                      |  | Total              |       | Dec. 31, |  | Sept. 30, |       | June 30, |  | March 31,  
|                                      |  | 2002               |       | 2002     |  | 2002      |       | 2002     |  | 2002       
|                                      |  |                    |       |          |  |           |       |          |  |            
|Crude Oil                             |  |                    |       |          |  |           |       |          |  | (mbbls/day) |       |  |  |  |       |  |  | 
|Light and medium crude oil and NGL(1) |  |                    | 125.9 |          |  |           | 137.8 |          |  |             | 131.4 |  |  |  | 116.6 |  |  |  | 117.5 | 
|Lloydminster heavy crude oil(1)       |  |                    | 79.4  |          |  |           | 83.9  |          |  |             | 80.0  |  |  |  | 76.9  |  |  |  | 76.9  | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|Total Gross(2)                        |  |                    | 205.3 |          |  |           | 221.7 |          |  |             | 211.4 |  |  |  | 193.5 |  |  |  | 194.4 | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|Net(2)                                |  |                    | 179.3 |          |  |           | 190.5 |          |  |             | 180.7 |  |  |  | 171.2 |  |  |  | 174.9 | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|Natural Gas                           |  |                    |       |          |  |           |       |          |  | (mmcf/day)  |       |  |  |  |       |  |  | 
|Gross(2)                              |  |                    | 569.2 |          |  |           | 577.4 |          |  |             | 561.6 |  |  |  | 571.8 |  |  |  | 566.0 | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|Net(2)                                |  |                    | 426.6 |          |  |           | 435.0 |          |  |             | 423.7 |  |  |  | 422.6 |  |  |  | 424.9 | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 

Notes:



---

|(1) |  | Light and medium crude oil includes crude oil that is 20° API gravity or
higher, as well as NGL. Heavy crude oil includes crude oil that is lower
than 20° API gravity in the Lloydminster area.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Gross volumes are Huskys lessor royalty, overriding royalty and working
interest share of production before deduction of royalties. Net volumes
are Huskys gross volumes, less royalties.     

8



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Production, continued

|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|------------------------------------- |  | ------------------ | ----- | -------- |  | --------- | ----- | -------- |  | ----------- | ----- |  |  |  | ----- |  |  |  | ----- | 
|                                      |  | Three Months Ended
|                                      |  |                   
|                                      |  | Total              |       | Dec. 31, |  | Sept. 30, |       | June 30, |  | March 31,  
|                                      |  | 2001               |       | 2001     |  | 2001      |       | 2001     |  | 2001       
|                                      |  |                    |       |          |  |           |       |          |  |            
|Crude Oil                             |  |                    |       |          |  |           |       |          |  | (mbbls/day) |       |  |  |  |       |  |  | 
|Light and medium crude oil and NGL(1) |  |                    | 112.0 |          |  |           | 111.3 |          |  |             | 112.7 |  |  |  | 108.6 |  |  |  | 115.5 | 
|Lloydminster heavy crude oil(1)       |  |                    | 65.4  |          |  |           | 75.0  |          |  |             | 69.1  |  |  |  | 60.3  |  |  |  | 56.9  | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|Total Gross(2)                        |  |                    | 177.4 |          |  |           | 186.3 |          |  |             | 181.8 |  |  |  | 168.9 |  |  |  | 172.4 | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|Net(2)                                |  |                    | 154.1 |          |  |           | 164.4 |          |  |             | 155.1 |  |  |  | 147.6 |  |  |  | 149.3 | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|Natural Gas                           |  |                    |       |          |  |           |       |          |  | (mmcf/day)  |       |  |  |  |       |  |  | 
|Gross(2)                              |  |                    | 572.6 |          |  |           | 568.7 |          |  |             | 567.1 |  |  |  | 570.8 |  |  |  | 584.0 | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 
|Net(2)                                |  |                    | 417.8 |          |  |           | 427.1 |          |  |             | 426.0 |  |  |  | 385.0 |  |  |  | 433.0 | 
|                                      |  |                    |       |          |  |           |       |          |  |             |       |  |  |  |       |  |  |  |       | 

Notes:



---

|(1) |  | Light and medium crude oil includes crude oil that is 20° API gravity or
higher, as well as NGL. Heavy crude oil includes crude oil that is lower
than 20° API gravity in the Lloydminster area.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Gross volumes are Huskys lessor royalty, overriding royalty and working
interest share of production before deduction of royalties. Net volumes
are Huskys gross volumes, less royalties.     

Capital Expenditures

The following table shows the dollar amounts expended by the Company on
property acquisitions, exploration and development for the periods indicated.

|                                   |  |                    |       |               |  |                |     |               |  |                |     |  |  |   |     |  |  |   |     | 
|---------------------------------- |  | ------------------ | ----- | ------------- |  | -------------- | --- | ------------- |  | -------------- | --- |  |  | - | --- |  |  | - | --- | 
|                                   |  | Three Months Ended
|                                   |  |                   
|($ millions)                       |  | Total 2002         |       | Dec. 31, 2002 |  | Sept. 30, 2002 |     | June 30, 2002 |  | March 31, 2002
|                                   |  |                    |       |               |  |                |     |               |  |               
|Property acquisitions              |  | $                  | 108   |               |  | $              | 50  |               |  | $              | 24  |  |  | $ | 21  |  |  | $ | 13  | 
|Exploration (including drilling)   |  |                    | 286   |               |  |                | 76  |               |  |                | 58  |  |  |   | 20  |  |  |   | 132 | 
|Development (including
facilities) |  |                    | 1,173 |               |  |                | 306 |               |  |                | 318 |  |  |   | 291 |  |  |   | 258 | 
|                                   |  |                    |       |               |  |                |     |               |  |                |     |  |  |   |     |  |  |   |     | 
|                                   |  | $                  | 1,567 |               |  | $              | 432 |               |  | $              | 400 |  |  | $ | 332 |  |  | $ | 403 | 
|                                   |  |                    |       |               |  |                |     |               |  |                |     |  |  |   |     |  |  |   |     | 

|                                   |  |                    |       |          |  |           |     |          |  |           |     |  |  |   |     |  |  |   |     | 
|---------------------------------- |  | ------------------ | ----- | -------- |  | --------- | --- | -------- |  | --------- | --- |  |  | - | --- |  |  | - | --- | 
|                                   |  | Three Months Ended
|                                   |  |                   
|                                   |  | Total              |       | Dec. 31, |  | Sept. 30, |     | June 30, |  | March 31,
|                                   |  | 2001               |       | 2001     |  | 2001      |     | 2001     |  | 2001     
|                                   |  |                    |       |          |  |           |     |          |  |          
|Property acquisitions(1)           |  | $                  | 177   |          |  | $         | 38  |          |  | $         | 112 |  |  | $ | 19  |  |  | $ | 8   | 
|Exploration (including drilling)   |  |                    | 267   |          |  |           | 69  |          |  |           | 49  |  |  |   | 65  |  |  |   | 84  | 
|Development (including
facilities) |  |                    | 873   |          |  |           | 246 |          |  |           | 226 |  |  |   | 174 |  |  |   | 227 | 
|                                   |  |                    |       |          |  |           |     |          |  |           |     |  |  |   |     |  |  |   |     | 
|                                   |  | $                  | 1,317 |          |  | $         | 353 |          |  | $         | 387 |  |  | $ | 258 |  |  | $ | 319 | 
|                                   |  |                    |       |          |  |           |     |          |  |           |     |  |  |   |     |  |  |   |     | 

Note:



---

|(1) |  | Does not include the acquisition of Titanium Oil & Gas Ltd. and Avid Oil
& Gas Ltd.
|--- |  | -----------------------------------------------------------------------------------

9



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##### 



Sales Prices and Lifting
Costs

The following table shows the Companys average sales prices, before and after
the effect of production hedging, and royalties, for light and medium crude oil
and NGL, Lloydminster heavy crude oil and natural gas and average lifting costs
on a boe basis for the periods indicated.

|                                              |  |         |  |   |       |                    |  |          |       |           |  |          |       |           |  |   |       |  |  |   |       |  |  | 
|--------------------------------------------- |  | ------- |  | - | ----- | ------------------ |  | -------- | ----- | --------- |  | -------- | ----- | --------- |  | - | ----- |  |  | - | ----- |  |  | 
|                                              |  |         |  |   |       | Three Months Ended
|                                              |  |         |  |   |       |                   
|                                              |  |         |  |   |       | Total              |  | Dec. 31, |       | Sept. 30, |  | June 30, |       | March 31,
|                                              |  |         |  |   |       | 2002               |  | 2002     |       | 2002 2002 |  | 2002     |       | 2002     
|                                              |  |         |  |   |       |                    |  |          |       |           |  |          |       |          
|Before the effect of hedging                  |  |         |  |   |       |                    |  |          |       |           |  |          |       |           |  |   |       |  |  |   |       |  |  | 
|Light and medium crude oil and NGL
(1)        |  | ($/bbl) |  | $ | 33.16 |                    |  | $        | 35.99 |           |  | $        | 36.72 |           |  | $ | 32.42 |  |  | $ | 26.17 | 
|Lloydminster heavy crude oil                  |  | ($/bbl) |  | $ | 26.09 |                    |  | $        | 25.47 |           |  | $        | 30.94 |           |  | $ | 27.02 |  |  | $ | 20.68 | 
|Natural gas                                   |  | ($/mcf) |  | $ | 3.83  |                    |  | $        | 4.76  |           |  | $        | 3.42  |           |  | $ | 3.98  |  |  | $ | 3.10  | 
|Realized prices (after the effect of
hedging) |  |         |  |   |       |                    |  |          |       |           |  |          |       |           |  |   |       |  |  |   |       |  |  | 
|Light and medium crude oil and NGL(1)         |  | ($/bbl) |  | $ | 33.28 |                    |  | $        | 36.64 |           |  | $        | 36.72 |           |  | $ | 32.42 |  |  | $ | 26.17 | 
|Lloydminster heavy crude oil                  |  | ($/bbl) |  | $ | 26.09 |                    |  | $        | 25.47 |           |  | $        | 30.94 |           |  | $ | 27.02 |  |  | $ | 20.68 | 
|Natural gas                                   |  | ($/mcf) |  | $ | 3.83  |                    |  | $        | 4.76  |           |  | $        | 3.42  |           |  | $ | 3.98  |  |  | $ | 3.10  | 
|Royalties                                     |  |         |  |   |       |                    |  |          |       |           |  |          |       |           |  |   |       |  |  |   |       |  |  | 
|Light and medium crude oil and NGL(1)         |  | ($/bbl) |  | $ | 4.87  |                    |  | $        | 5.26  |           |  | $        | 5.42  |           |  | $ | 4.99  |  |  | $ | 3.65  | 
|Lloydminster heavy crude oil                  |  | ($/bbl) |  | $ | 3.08  |                    |  | $        | 3.90  |           |  | $        | 4.17  |           |  | $ | 2.48  |  |  | $ | 1.60  | 
|Natural gas                                   |  | ($/mcf) |  | $ | 0.70  |                    |  | $        | 0.90  |           |  | $        | 0.55  |           |  | $ | 0.85  |  |  | $ | 0.50  | 

|                                              |  |         |  |   |       |                    |  |          |       |           |  |          |       |           |  |   |       |  |  |   |       |  |  | 
|--------------------------------------------- |  | ------- |  | - | ----- | ------------------ |  | -------- | ----- | --------- |  | -------- | ----- | --------- |  | - | ----- |  |  | - | ----- |  |  | 
|                                              |  |         |  |   |       | Three Months Ended
|                                              |  |         |  |   |       |                   
|                                              |  |         |  |   |       | Total              |  | Dec. 31, |       | Sept. 30, |  | June 30, |       | March 31,
|                                              |  |         |  |   |       | 2001               |  | 2001     |       | 2001      |  | 2001     |       | 2001     
|                                              |  |         |  |   |       |                    |  |          |       |           |  |          |       |          
|Before the effect of hedging                  |  |         |  |   |       |                    |  |          |       |           |  |          |       |           |  |   |       |  |  |   |       |  |  | 
|Light and medium crude oil and NGL(1)         |  | ($/bbl) |  | $ | 27.19 |                    |  | $        | 19.44 |           |  | $        | 31.74 |           |  | $ | 28.86 |  |  | $ | 28.72 | 
|Lloydminster heavy crude oil                  |  | ($/bbl) |  | $ | 15.85 |                    |  | $        | 10.44 |           |  | $        | 23.65 |           |  | $ | 15.52 |  |  | $ | 13.81 | 
|Natural gas                                   |  | ($/mcf) |  | $ | 5.47  |                    |  | $        | 3.01  |           |  | $        | 3.25  |           |  | $ | 6.57  |  |  | $ | 9.05  | 
|Realized prices (after the effect of
hedging) |  |         |  |   |       |                    |  |          |       |           |  |          |       |           |  |   |       |  |  |   |       |  |  | 
|Light and medium crude oil and NGL(1)         |  | ($/bbl) |  | $ | 27.19 |                    |  | $        | 19.44 |           |  | $        | 31.74 |           |  | $ | 28.86 |  |  | $ | 28.72 | 
|Lloydminster heavy crude oil                  |  | ($/bbl) |  | $ | 15.85 |                    |  | $        | 10.44 |           |  | $        | 23.65 |           |  | $ | 15.52 |  |  | $ | 13.81 | 
|Natural gas                                   |  | ($/mcf) |  | $ | 5.47  |                    |  | $        | 3.01  |           |  | $        | 3.25  |           |  | $ | 6.57  |  |  | $ | 9.05  | 
|Royalties                                     |  |         |  |   |       |                    |  |          |       |           |  |          |       |           |  |   |       |  |  |   |       |  |  | 
|Light and medium crude oil and NGL(1)         |  | ($/bbl) |  | $ | 5.17  |                    |  | $        | 3.64  |           |  | $        | 6.26  |           |  | $ | 5.33  |  |  | $ | 5.45  | 
|Lloydminster heavy oil                        |  | ($/bbl) |  | $ | 1.25  |                    |  | $        | 0.08  |           |  | $        | 2.33  |           |  | $ | 1.31  |  |  | $ | 1.42  | 
|Natural gas                                   |  | ($/mcf) |  | $ | 1.25  |                    |  | $        | 0.59  |           |  | $        | 0.61  |           |  | $ | 2.02  |  |  | $ | 2.26  | 

Note:



---

|(1) |  | Light and medium crude oil includes crude oil that is 20o API gravity or
higher, as well as NGL. Heavy crude oil includes crude oil that is lower
than 20o API gravity in the Lloydminster area.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

10



---



##### 



Oil and Gas Netbacks(1)

The following table shows the Companys average netback for operations
classified as light and medium crude oil operations, Lloydminster heavy crude
oil operations and natural gas operations for the periods indicated. The
classification is based on the oil/gas ratio. The prior year netbacks have been
restated to reflect current year classification of certain wellhead and mineral
taxes as royalties instead of operating costs.

|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|---------------------------- |  | --------- |  |  |  | ------------------ | ----- | -------- |  | --------- | ----- | -------- |  | --------- | ----- |  |  | - | ----- |  |  | - | ----- | 
|                             |  |           |  |  |  | Three Months Ended
|                             |  |           |  |  |  |                   
|                             |  |           |  |  |  | Total              |       | Dec. 31, |  | Sept. 30, |       | June 30, |  | March 31,
|                             |  |           |  |  |  | 2002               |       | 2002     |  | 2002      |       | 2002     |  | 2002     
|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |          
|Light and medium crude oil   |  | ($/boe)   |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |  
|Sales revenue                |  |           |  |  |  | $                  | 33.02 |          |  | $         | 36.13 |          |  | $         | 36.18 |  |  | $ | 32.33 |  |  | $ | 26.08 | 
|Royalties                    |  |           |  |  |  |                    | 4.47  |          |  |           | 4.73  |          |  |           | 5.09  |  |  |   | 4.63  |  |  |   | 3.28  | 
|Operating costs              |  |           |  |  |  |                    | 7.35  |          |  |           | 7.11  |          |  |           | 7.35  |  |  |   | 7.30  |  |  |   | 7.61  | 
|G&A                          |  |           |  |  |  |                    | 0.41  |          |  |           | 0.41  |          |  |           | 0.53  |  |  |   | 0.30  |  |  |   | 0.38  | 
|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Netback                      |  |           |  |  |  | $                  | 20.79 |          |  | $         | 23.88 |          |  | $         | 23.21 |  |  | $ | 20.10 |  |  | $ | 14.81 | 
|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Lloydminster heavy crude oil |  | ($/boe)   |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |  
|Sales revenue                |  |           |  |  |  | $                  | 26.02 |          |  | $         | 25.50 |          |  | $         | 30.82 |  |  | $ | 27.00 |  |  | $ | 20.47 | 
|Royalties                    |  |           |  |  |  |                    | 2.97  |          |  |           | 3.79  |          |  |           | 4.05  |  |  |   | 2.25  |  |  |   | 1.59  | 
|Operating costs              |  |           |  |  |  |                    | 7.03  |          |  |           | 8.49  |          |  |           | 6.14  |  |  |   | 6.94  |  |  |   | 6.42  | 
|G&A                          |  |           |  |  |  |                    | 0.41  |          |  |           | 0.41  |          |  |           | 0.53  |  |  |   | 0.30  |  |  |   | 0.38  | 
|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Netback                      |  |           |  |  |  | $                  | 15.61 |          |  | $         | 12.81 |          |  | $         | 20.10 |  |  | $ | 17.51 |  |  | $ | 12.08 | 
|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Natural gas                  |  | ($/mcfge) |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |  
|Sales revenue                |  |           |  |  |  | $                  | 3.96  |          |  | $         | 4.98  |          |  | $         | 3.60  |  |  | $ | 4.05  |  |  | $ | 3.19  | 
|Royalties                    |  |           |  |  |  |                    | 0.82  |          |  |           | 1.05  |          |  |           | 0.65  |  |  |   | 0.95  |  |  |   | 0.59  | 
|Operating costs              |  |           |  |  |  |                    | 0.70  |          |  |           | 0.75  |          |  |           | 0.76  |  |  |   | 0.71  |  |  |   | 0.57  | 
|G&A                          |  |           |  |  |  |                    | 0.07  |          |  |           | 0.07  |          |  |           | 0.09  |  |  |   | 0.05  |  |  |   | 0.06  | 
|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Netback                      |  |           |  |  |  | $                  | 2.37  |          |  | $         | 3.11  |          |  | $         | 2.10  |  |  | $ | 2.34  |  |  | $ | 1.97  | 
|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Total Company Netbacks       |  | ($/boe)   |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |  
|Sales revenue                |  |           |  |  |  | $                  | 28.17 |          |  | $         | 31.35 |          |  | $         | 30.31 |  |  | $ | 28.21 |  |  | $ | 22.25 | 
|Royalties                    |  |           |  |  |  |                    | 4.20  |          |  |           | 4.98  |          |  |           | 4.45  |  |  |   | 4.35  |  |  |   | 2.90  | 
|Operating costs              |  |           |  |  |  |                    | 6.24  |          |  |           | 6.66  |          |  |           | 6.19  |  |  |   | 6.19  |  |  |   | 5.88  | 
|G&A                          |  |           |  |  |  |                    | 0.41  |          |  |           | 0.41  |          |  |           | 0.53  |  |  |   | 0.30  |  |  |   | 0.38  | 
|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Netback                      |  |           |  |  |  | $                  | 17.32 |          |  | $         | 19.30 |          |  | $         | 19.14 |  |  | $ | 17.37 |  |  | $ | 13.09 | 
|                             |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 

|                             |  |         |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|---------------------------- |  | ------- |  |  |  | ------------------ | ----- | -------- |  | --------- | ----- | -------- |  | --------- | ----- |  |  | - | ----- |  |  | - | ----- | 
|                             |  |         |  |  |  | Three Months Ended
|                             |  |         |  |  |  |                   
|                             |  |         |  |  |  | Total              |       | Dec. 31, |  | Sept. 30, |       | June 30, |  | March 31,
|                             |  |         |  |  |  | 2001               |       | 2001     |  | 2001      |       | 2001     |  | 2001     
|                             |  |         |  |  |  |                    |       |          |  |           |       |          |  |          
|Light and medium crude oil   |  | ($/boe) |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |  
|Sales revenue                |  |         |  |  |  | $                  | 27.42 |          |  | $         | 19.18 |          |  | $         | 31.57 |  |  | $ | 29.51 |  |  | $ | 29.70 | 
|Royalties                    |  |         |  |  |  |                    | 4.87  |          |  |           | 3.33  |          |  |           | 5.99  |  |  |   | 5.00  |  |  |   | 5.32  | 
|Operating costs              |  |         |  |  |  |                    | 7.47  |          |  |           | 8.42  |          |  |           | 7.55  |  |  |   | 7.50  |  |  |   | 6.29  | 
|G&A )                        |  |         |  |  |  |                    | 0.42  |          |  |           | 0.50  |          |  |           | 0.51  |  |  |   | 0.42  |  |  |   | 0.25  | 
|                             |  |         |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Netback                      |  |         |  |  |  | $                  | 14.66 |          |  | $         | 6.93  |          |  | $         | 17.52 |  |  | $ | 16.59 |  |  | $ | 17.84 | 
|                             |  |         |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Lloydminster heavy crude oil |  | ($/boe) |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |  
|Sales revenue                |  |         |  |  |  | $                  | 16.00 |          |  | $         | 10.48 |          |  | $         | 23.63 |  |  | $ | 15.73 |  |  | $ | 14.27 | 
|Royalties                    |  |         |  |  |  |                    | 1.27  |          |  |           | 0.11  |          |  |           | 2.29  |  |  |   | 1.54  |  |  |   | 1.27  | 
|Operating costs              |  |         |  |  |  |                    | 7.60  |          |  |           | 7.08  |          |  |           | 7.30  |  |  |   | 8.11  |  |  |   | 8.13  | 
|G&A                          |  |         |  |  |  |                    | 0.42  |          |  |           | 0.50  |          |  |           | 0.51  |  |  |   | 0.42  |  |  |   | 0.25  | 
|                             |  |         |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Netback                      |  |         |  |  |  | $                  | 6.71  |          |  | $         | 2.79  |          |  | $         | 13.53 |  |  | $ | 5.66  |  |  | $ | 4.62  | 
|                             |  |         |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 

11



---



##### 



|                       |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|---------------------- |  | --------- |  |  |  | ------------------ | ----- | -------- |  | --------- | ----- | -------- |  | --------- | ----- |  |  | - | ----- |  |  | - | ----- | 
|                       |  |           |  |  |  | Three Months Ended
|                       |  |           |  |  |  |                   
|                       |  |           |  |  |  | Total              |       | Dec. 31, |  | Sept. 30, |       | June 30, |  | March 31,
|                       |  |           |  |  |  | 2001               |       | 2001     |  | 2001      |       | 2001     |  | 2001     
|                       |  |           |  |  |  |                    |       |          |  |           |       |          |  |          
|Natural gas            |  | ($/mcfge) |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |  
|Sales revenue          |  |           |  |  |  | $                  | 5.39  |          |  | $         | 3.06  |          |  | $         | 3.34  |  |  | $ | 6.42  |  |  | $ | 8.75  | 
|Royalties              |  |           |  |  |  |                    | 1.30  |          |  |           | 0.65  |          |  |           | 0.69  |  |  |   | 1.57  |  |  |   | 2.27  | 
|Operating costs        |  |           |  |  |  |                    | 0.58  |          |  |           | 0.67  |          |  |           | 0.66  |  |  |   | 0.57  |  |  |   | 0.43  | 
|G&A                    |  |           |  |  |  |                    | 0.07  |          |  |           | 0.08  |          |  |           | 0.09  |  |  |   | 0.07  |  |  |   | 0.04  | 
|                       |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Netback                |  |           |  |  |  | $                  | 3.44  |          |  | $         | 1.66  |          |  | $         | 1.90  |  |  | $ | 4.21  |  |  | $ | 6.01  | 
|                       |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Total Company Netbacks |  | ($/boe)   |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |  
|Sales revenue          |  |           |  |  |  | $                  | 26.42 |          |  | $         | 16.55 |          |  | $         | 25.50 |  |  | $ | 29.59 |  |  | $ | 34.80 | 
|Royalties              |  |           |  |  |  |                    | 5.04  |          |  |           | 2.67  |          |  |           | 4.38  |  |  |   | 5.78  |  |  |   | 7.52  | 
|Operating costs        |  |           |  |  |  |                    | 6.08  |          |  |           | 6.54  |          |  |           | 6.24  |  |  |   | 6.19  |  |  |   | 5.31  | 
|G&A                    |  |           |  |  |  |                    | 0.42  |          |  |           | 0.50  |          |  |           | 0.51  |  |  |   | 0.42  |  |  |   | 0.25  | 
|                       |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 
|Netback                |  |           |  |  |  | $                  | 14.88 |          |  | $         | 6.84  |          |  | $         | 14.37 |  |  | $ | 17.20 |  |  | $ | 21.72 | 
|                       |  |           |  |  |  |                    |       |          |  |           |       |          |  |           |       |  |  |   |       |  |  |   |       | 

Note:



---

|(1) |  | Netbacks reflect the results of operations for leases classified as oil
or natural gas. Co-products, such as natural gas produced at an oil
property or natural gas liquids produced at a natural gas property, have
been converted to equivalent units of oil or natural gas depending on the
lease classification.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Producing Wells

The following table presents the number of wells that were producing or capable
of producing at December 31, 2002 in which Husky held a working interest.

|                        |                  |             |           |        |             |             |       |        |  |          |       |        |  |  |       |       |  |  |        |       |  |  |       |       | 
|----------------------- | ---------------- | ----------- | --------- | ------ | ----------- | ----------- | ----- | ------ |  | -------- | ----- | ------ |  |  | ----- | ----- |  |  | ------ | ----- |  |  | ----- | ----- | 
|                        |                  |             | Oil Wells |        | Natural Gas |             | Total
|                        |                  |             |           |        |             |             |      
|As at December 31, 2002 |                  | Gross(1)(2) |           | Net(1) |             | Gross(1)(2) |       | Net(1) |  | Gross(1) |       | Net(1)
|                        |                  |             |           |        |             |             |       |        |  |          |       |       
|Canada                  |                  |             |           |        |             |             |       |        |  |          |       |        |  |  |       |       |  |  |        |       |  |  |       |      
|                        | Alberta          |             |           | 5,129  |             |             |       | 3,491  |  |          |       | 4,382  |  |  |       | 2,128 |  |  |        | 9,511 |  |  |       | 5,619 | 
|                        | Saskatchewan     |             |           | 4,568  |             |             |       | 3,276  |  |          |       | 479    |  |  |       | 261   |  |  |        | 5,047 |  |  |       | 3,537 | 
|                        | British Columbia |             |           | 200    |             |             |       | 56     |  |          |       | 27     |  |  |       | 11    |  |  |        | 227   |  |  |       | 67    | 
|                        | Manitoba         |             |           | 3      |             |             |       | 1      |  |          |       |        |  |  |       |       |  |  |        | 3     |  |  |       | 1     | 
|                        | Newfoundland     |             |           | 6      |             |             |       | 1      |  |          |       |        |  |  |       |       |  |  |        | 6     |  |  |       | 1     | 
|                        |                  |             |           |        |             |             |       |        |  |          |       |        |  |  |       |       |  |  |        |       |  |  |       |      
|                        |                  |             | 9,906     |        |             |             | 6,825 |        |  |          | 4,888 |        |  |  | 2,400 |       |  |  | 14,794 |       |  |  | 9,225 |      
|                        |                  |             |           |        |             |             |       |        |  |          |       |        |  |  |       |       |  |  |        |       |  |  |       |      
|International           |                  |             |           |        |             |             |       |        |  |          |       |        |  |  |       |       |  |  |        |       |  |  |       |      
|                        | China            |             |           | 21     |             |             |       | 8      |  |          |       |        |  |  |       |       |  |  |        | 21    |  |  |       | 8     | 
|                        | Libya            |             |           | 2      |             |             |       | 1      |  |          |       |        |  |  |       |       |  |  |        | 2     |  |  |       | 1     | 
|                        |                  |             |           |        |             |             |       |        |  |          |       |        |  |  |       |       |  |  |        |       |  |  |       |      
|                        |                  |             | 23        |        |             |             | 9     |        |  |          |       |        |  |  |       |       |  |  | 23     |       |  |  | 9     |      
|                        |                  |             |           |        |             |             |       |        |  |          |       |        |  |  |       |       |  |  |        |       |  |  |       |      
|                        |                  |             | 9,929     |        |             |             | 6,834 |        |  |          | 4,888 |        |  |  | 2,400 |       |  |  | 14,817 |       |  |  | 9,234 |      
|                        |                  |             |           |        |             |             |       |        |  |          |       |        |  |  |       |       |  |  |        |       |  |  |       |      

Notes:



---

|(1) |  | The number of gross wells is the total number of wells in which Husky
owns a working interest. The number of net wells is the sum of the
fractional interests owned in the gross wells.                                                                                                                                                                
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Includes 197 gross oil wells and 278 gross natural gas wells which were
completed in two or more formations and from which the production is not
commingled. For the purposes of this table multiple completions are
counted as single wells. Where one of the completions in a given well is
an oil completion, the well is classified as an oil well.

Drilling Activity

Huskys gross and net exploratory and development drilling activities in
Western Canada for the years ended December 31, 2002 and 2001 are set forth on
page 48 of Huskys 2002 Annual Report and is incorporated herein by reference.

12



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##### 



Reserves

Huskys oil and gas reserves as of December 31, 2002 are based on constant
prices and costs as prepared internally by Huskys engineers. Husky uses a
formalized process for determining, approving and booking reserves. This
process provides for all reserves evaluation to be done on a consistent basis
using established definitions and guidelines. Approval of any significant
reserve additions and changes requires review by an internal panel of qualified
technical experts.

The Companys engineers determined Huskys oil and gas reserves as of December
31, 2002 and approximately 65% of the Companys proved oil and gas reserves
were reviewed by McDaniel and Associates Consultants Ltd. In the opinion of
McDaniel and Associates Consultants Ltd. the properties included in the review
were determined in accordance with generally accepted reserves determination
methods and in sufficient detail to provide confident estimates of proved
reserves for the aggregate reserves reviewed. McDaniel and Associates
Consultants Ltd. further indicated that their reserves estimates for the
aggregate of the properties included in the review were approximately 10% lower
than Huskys reserves estimates for the same properties.

The following table presents Huskys proved producing, proved non-producing and
probable reserves and associated future net cash flows as at December 31, 2002.
Future net revenues, based on constant prices and costs, are presented net of
royalties, operating costs and future development costs and prior to deductions
for overhead, interest and income tax charges. Estimated future net revenues
based on constant prices and costs assume continuation of year end economic
conditions including market demand and government policy, which are subject to
uncertainty and may differ materially in the future. It should not be assumed
that the discounted value of estimated future net reserves is representative of
the fair market value of the reserves.

|                        |  |           |         |         |  |                                        |       |        |  |              |         |     |  |     |         |  |  |   |        |  |  |   |        |  |  |   |        | 
|----------------------- |  | --------- | ------- | ------- |  | -------------------------------------- | ----- | ------ |  | ------------ | ------- | --- |  | --- | ------- |  |  | - | ------ |  |  | - | ------ |  |  | - | ------ | 
|                        |  | Crude oil |         | Natural |  |                                        |       |        |  |              |         |     |  |     |         | 
|                        |  | & NGL     |         | Gas     |  | Future Net Cash Flows Before Tax(3)(4)
|                        |  | (mmbbls)  |         | (bcf)   |  | ($ millions)                          
|                        |  |           |         |         |  |                                       
|                        |  | Gross(1)  |         | Net(1)  |  | Gross(1)                               |       | Net(1) |  | Undiscounted |         | 10% |  | 15%
|                        |  |           |         |         |  |                                        |       |        |  |              |         |     |  |    
|Proved producing(2)     |  |           | 422.5   |         |  |                                        | 374.0 |        |  |              | 1,297.1 |     |  |     | 1,063.0 |  |  | $ | 14,961 |  |  | $ | 8,848  |  |  | $ | 7,635  | 
|Proved non-producing(2) |  |           | 146.7   |         |  |                                        | 126.8 |        |  |              | 797.4   |     |  |     | 649.7   |  |  |   | 5,850  |  |  |   | 2,998  |  |  |   | 2,338  | 
|                        |  |           |         |         |  |                                        |       |        |  |              |         |     |  |     |         |  |  |   |        |  |  |   |        |  |  |   |        | 
|Proved(2)               |  |           | 569.2   |         |  |                                        | 500.8 |        |  |              | 2,094.5 |     |  |     | 1,712.7 |  |  |   | 20,811 |  |  |   | 11,846 |  |  |   | 9,973  | 
|Probable(2)             |  |           | 452.2   |         |  |                                        | 403.4 |        |  |              | 402.8   |     |  |     | 321.3   |  |  |   | 11,420 |  |  |   | 5,321  |  |  |   | 3,925  | 
|                        |  |           |         |         |  |                                        |       |        |  |              |         |     |  |     |         |  |  |   |        |  |  |   |        |  |  |   |        | 
|Total                   |  |           | 1,021.4 |         |  |                                        | 904.2 |        |  |              | 2,497.3 |     |  |     | 2,034.0 |  |  | $ | 32,231 |  |  | $ | 17,167 |  |  | $ | 13,898 | 
|                        |  |           |         |         |  |                                        |       |        |  |              |         |     |  |     |         |  |  |   |        |  |  |   |        |  |  |   |        | 

Notes:



---

|(1) |  | Gross reserves are Huskys lessor royalty, overriding royalty and working
interest share of reserves, before deduction of royalties. Net reserves are
gross reserves, less royalties.      
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | These reserve categories have the same meanings as those set out in
National Policy Statement #2B.                                                                                         
|   
|(3) |  | The discounted future net cash flows at December 31, 2002 were based on the
year-end spot NYMEX natural gas price of U.S. $4.60/mmbtu and on a spot WTI
crude oil price of U.S. $31.21/bbl.

|    |  |                           |  |       |       |      |       |      |     |   |     |   |     |   |     | 
|--- |  | ------------------------- |  | ----- | ----- | ---- | ----- | ---- | --- | - | --- | - | --- | - | --- | 
|(4) |  | Future Capital Costs      |  |       |       |      |       |      |     |   |     |   |     |  
|    |  | ($ millions undiscounted) |  | Total |       | 2003 |       | 2004
|    |  |                           |  |       |       |      |       |     
|    |  | Proved developed          |  | $     | 450   |      |       | $    | 85  |   |     | $ | 38  |  
|    |  | Proved undeveloped        |  |       | 837   |      |       |      | 272 |   |     |   | 165 |  
|    |  |                           |  |       |       |      |       |      |     |   |     |   |     |   |     | 
|    |  |                           |  |       |       |      | 1,287 |      |     |   | 357 |   |     |   | 203 | 
|    |  | Probable                  |  |       | 2,196 |      |       |      | 587 |   |     |   | 545 |  
|    |  |                           |  |       |       |      |       |      |     |   |     |   |     |   |     | 
|    |  |                           |  |       |       | $    | 3,483 |      |     | $ | 944 |   |     | $ | 748 | 
|    |  |                           |  |       |       |      |       |      |     |   |     |   |     |   |     | 

Future capital costs include estimated development capital expenditures
necessary to gain access to proved undeveloped reserves and probable reserves
as well as estimated capital expenditures necessary to maintain production of
proved developed reserves.

13



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##### 



Reserve Reconciliation

Reconciliation of the gross reserves and net reserves of Husky are set forth on
pages 94 and 91, respectively, of Huskys 2002 Annual Report and are
incorporated herein by reference.

Reserves and Production by Principal Area

Huskys estimate of its proved reserves by area as of December 31, 2002 and
daily average production of crude oil, NGL and natural gas by area are as
follows:

Light/Medium Crude Oil and NGL

|                             |                                   |                            |       |                 |      |             |       |      |      | 
|---------------------------- | --------------------------------- | -------------------------- | ----- | --------------- | ---- | ----------- | ----- | ---- | ---- | 
|                             |                                   |                            |       | Proved Reserves |      | Production 
|                             |                                   |                            |       | (mmbbls)        |      | (mbbls/day)
|                             |                                   |                            |       |                 |      |            
|Canada                       |                                   |                            |       |                 |      |             |       |     
|Western Canada               |                                   |                            |       |                 |      |             |       |     
|                             | British Columbia and Foothills    |                            |       |                 |      |             |       |      |     
|                             |                                   | Alberta and BC Plains area |       |                 | 31.3 |             |       |      | 7.8  | 
|                             |                                   | Foothills Deep Gas area    |       |                 | 23.3 |             |       |      | 7.3  | 
|                             |                                   | Ram River area             |       |                 | 3.1  |             |       |      | 0.7  | 
|                             | Northwest Alberta Plains          |                            |       |                 |      |             |       |      |     
|                             |                                   | Rainbow Lake area          |       |                 | 85.1 |             |       |      | 8.8  | 
|                             |                                   | Peace River Arch area      |       |                 | 10.8 |             |       |      | 3.8  | 
|                             | East Central Alberta              |                            |       |                 |      |             |       |      |     
|                             |                                   | Provost area               |       |                 | 41.5 |             |       |      | 24.9 | 
|                             |                                   | North area                 |       |                 | 1.5  |             |       |      | 0.8  | 
|                             |                                   | South area                 |       |                 | 5.6  |             |       |      | 3.2  | 
|                             | Southern Alberta and Saskatchewan |                            |       |                 |      |             |       |      |     
|                             |                                   | South Alberta area         |       |                 | 24.5 |             |       |      | 16.8 | 
|                             |                                   | South Saskatchewan area    |       |                 | 76.3 |             |       |      | 21.3 | 
|                             | Lloydminster Area                 |                            |       |                 |      |             |       |      |     
|                             |                                   | Wainwright/Wildmere area   |       |                 | 16.5 |             |       |      | 4.5  | 
|                             | Other                             |                            |       | 0.9             |      |             |       | 0.3  |     
|                             |                                   |                            |       |                 |      |             |       |     
|                             |                                   |                            | 320.4 |                 |      |             | 100.2 |     
|East Coast Canada            |                                   |                            | 31.0  |                 |      |             | 13.2  |     
|                             |                                   |                            |       |                 |      |             |       |     
|                             |                                   |                            | 351.4 |                 |      |             | 113.4 |     
|International                |                                   |                            |       |                 |      |             |       |     
|China                        |                                   |                            | 30.1  |                 |      |             | 12.2  |     
|Indonesia                    |                                   |                            | 6.4   |                 |      |             |       |     
|Libya                        |                                   |                            | 0.6   |                 |      |             | 0.3   |     
|                             |                                   |                            |       |                 |      |             |       |     
|                             |                                   |                            | 388.5 |                 |      |             | 125.9 |     
|                             |                                   |                            |       |                 |      |             |       |     
|Lloydminster Heavy Crude Oil |                                   |                            |       |                 |      |             |       |     
|Lloydminster area            |                                   |                            |       |                 |      |             |       |     
|                             | Primary production                |                            |       | 115.1           |      |             |       | 68.4 |     
|                             | Thermal production                |                            |       | 65.6            |      |             |       | 11.0 |     
|                             |                                   |                            |       |                 |      |             |       |     
|                             |                                   |                            | 180.7 |                 |      |             | 79.4  |     
|                             |                                   |                            |       |                 |      |             |       |     
|                             |                                   |                            | 569.2 |                 |      |             | 205.3 |     
|                             |                                   |                            |       |                 |      |             |       |     

14



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##### 



Natural Gas

|               |                                   |                            |         |                 |       |            |       |      |       | 
|-------------- | --------------------------------- | -------------------------- | ------- | --------------- | ----- | ---------- | ----- | ---- | ----- | 
|               |                                   |                            |         | Proved Reserves |       | Production
|Western Canada |                                   | (bcf)                      |         | (mmcf/day)     
|               |                                   |                            |         |                
|               | British Columbia and Foothills    |                            |         |                 |       |            |       |      |      
|               |                                   | Alberta and BC Plains area |         |                 | 108.9 |            |       |      | 32.4  | 
|               |                                   | Foothills Deep Gas area    |         |                 | 230.7 |            |       |      | 97.3  | 
|               |                                   | Ram River area             |         |                 | 256.7 |            |       |      | 66.9  | 
|               | Northwest Alberta Plains          |                            |         |                 |       |            |       |      |      
|               |                                   | Rainbow Lake area          |         |                 | 248.8 |            |       |      | 16.9  | 
|               |                                   | Northern Alberta area      |         |                 | 489.8 |            |       |      | 133.4 | 
|               | East Central Alberta              |                            |         |                 |       |            |       |      |      
|               |                                   | Provost area               |         |                 | 51.2  |            |       |      | 13.3  | 
|               |                                   | North area                 |         |                 | 137.1 |            |       |      | 58.7  | 
|               |                                   | South area                 |         |                 | 146.0 |            |       |      | 61.1  | 
|               | Southern Alberta and Saskatchewan |                            |         |                 |       |            |       |      |      
|               |                                   | South Alberta area         |         |                 | 31.4  |            |       |      | 15.8  | 
|               |                                   | South Saskatchewan area    |         |                 | 147.7 |            |       |      | 21.9  | 
|               | Lloydminster Area                 |                            |         | 87.6            |       |            |       | 44.3 |      
|               | Other                             |                            |         | 15.7            |       |            |       | 7.2  |      
|               |                                   |                            |         |                 |       |            |       |     
|               |                                   |                            | 1,951.6 |                 |       |            | 569.2 |     
|               |                                   |                            |         |                 |       |            |       |     
|International  |                                   |                            |         |                 |       |            |       |     
|Indonesia      |                                   |                            | 142.9   |                 |       |            |      |     
|               |                                   |                            |         |                 |       |            |       |     
|               |                                   |                            | 2,094.5 |                 |       |            | 569.2 |     
|               |                                   |                            |         |                 |       |            |       |     

Landholdings

Huskys undeveloped acreage as at December 31, 2002 is set forth on page 48 of
Huskys 2002 Annual Report and is incorporated herein by reference. Huskys
developed acreage as at December 31, 2002 is summarized below:

|               |                  |  |                      |       |     |  |       |       | 
|-------------- | ---------------- |  | -------------------- | ----- | --- |  | ----- | ----- | 
|               |                  |  | Developed Acreage   
|               |                  |  |                     
|               |                  |  | Gross                |       | Net
|               |                  |  |                      |       |    
|               |                  |  | (thousands of acres)
|Western Canada |                  |  |                      |       |     |  |       |      
|               | Alberta          |  |                      | 2,863 |     |  |       | 2,443 | 
|               | Saskatchewan     |  |                      | 523   |     |  |       | 465   | 
|               | British Columbia |  |                      | 101   |     |  |       | 63    | 
|               | Manitoba         |  |                      | 1     |     |  |       | 1     | 
|               |                  |  |                      |       |     |  |       |      
|               |                  |  | 3,488                |       |     |  | 2,972 |      
|Eastern Canada |                  |  | 35                   |       |     |  | 4     |      
|               |                  |  |                      |       |     |  |       |      
|               |                  |  | 3,523                |       |     |  | 2,976 |      
|China          |                  |  | 17                   |       |     |  | 7     |      
|Libya          |                  |  | 7                    |       |     |  | 2     |      
|               |                  |  |                      |       |     |  |       |      
|               |                  |  | 3,547                |       |     |  | 2,985 |      
|               |                  |  |                      |       |     |  |       |      

15



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##### 



Description of Major Properties and Facilities

Huskys portfolio of producing assets in Western Canada include properties that
produce light, medium and heavy gravity crude oil, NGL, natural gas and
sulphur. Huskys upstream strategy in Western Canada in recent years has been
to further delineate and exploit its core producing areas and to increase its
interest in such areas through selective asset acquisitions, divestitures and
trades. Husky believes that it can benefit from both operating efficiencies and
increased control over the development strategy and the pace of capital
investment in these areas.

Husky assembled a cost management team in order to continue to focus on
operating cost management and production optimization efforts. A group of
experienced engineering and operating staff work with the business unit and
field teams to identify and quantify opportunities to reduce costs and improve
reliability and increase efficiency of core assets. Once this multi-discipline
team has evaluated and prioritized opportunities, projects are returned to the
business unit for approval and execution. As the cost management team reviews
more assets, it will be able to pass on best practices to other operating
areas.

(HUSKY MAP)

16



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##### 



LLOYDMINSTER HEAVY OIL AND GAS

Huskys heavy oil assets are concentrated in a large producing area covering
more than 14,800 square kilometres in the Lloydminster area in the provinces of
Saskatchewan and Alberta. Approximately 80% of Huskys proved reserves in the
region are contained in the heavy crude oil producing fields of Pikes Peak,
Edam, Tangleflags, Celtic, Bolney, Westhazel, Big Gully, Hillmond, Mervin,
Marwayne, Lashburn, Baldwinton and Rush Lake, and in the medium gravity crude
oil producing fields of Wildmere and Wainwright. These fields contain extensive
accumulations of heavy crude oil at relatively shallow depths. Husky maintains
a land position of approximately 1.5 million net acres in the Lloydminster
area, of which approximately two-thirds is undeveloped.

Husky currently produces from oil and gas wells ranging in depth from 455 to
700 metres and holds a 100% working interest in the majority of these wells.
Husky produces heavy oil from the Lloydminster area using a variety of
techniques, including standard primary production methods, as well as steam
injection and horizontal well technology. Husky has increased primary
production from the area through cold production techniques which utilize
progressive cavity pumps capable of simultaneous production of sand and heavy
oil from unconsolidated formations. Huskys gross heavy and medium crude oil
production from the area totalled 83.9 mbbls/day in 2002. Approximately 68.4
mbbls/day of that total was primary production of heavy crude oil,
approximately 11.0 mbbls/day was production from Huskys Pikes Peak cyclic
steam operation and Bolney/Celtic thermal project and approximately 4.5
mbbls/day was from the medium gravity waterflooded fields in the Wainwright and
Wildmere areas. Husky believes that the future growth from this area will be
driven by primary heavy oil production and new thermal projects.

Huskys infrastructure in the Lloydminster area is extensive. Husky owns and
operates 16 oil treating facilities, all of which are tied into Huskys heavy
oil pipeline systems. These pipeline systems transport heavy crude oil from the
field locations to Huskys Lloydminster asphalt refinery, to the Husky
Lloydminster Upgrader and to the Enbridge Pipeline and Express Pipeline systems
at Hardisty, Alberta.

Husky is focused on increasing its heavy oil production and believes that its
undeveloped land position in the Lloydminster area, coupled with the
application of improved technologies, a reduced cost structure and increased
upgrading capacity, will provide strong growth opportunities for heavy oil
production.

Husky also produces natural gas from shallow natural gas pools in the
Lloydminster area that are generally small (approximately 1 to 2 bcf of proved
reserves), but numerous. Huskys total gross natural gas production from the
area was 44.3 mmcf/day during 2002.

17



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##### 



(LLOYDMINSTER MAP)

NORTHWEST ALBERTA PLAINS

Rainbow Lake Area

Rainbow Lake, located approximately 900 kilometres north-west of Edmonton,
Alberta, is the site of Huskys largest light oil production operation in
Western Canada. Husky operates a number of crude oil pools in the Rainbow
basin, with an average working interest of 54%. Huskys production in this area
is derived from more than 50 oil and gas pools extending over 1,300 square
kilometres.

Husky uses secondary and tertiary oil recovery methods extensively in the
Rainbow Lake area. Husky has developed considerable expertise in these methods,
which include injecting water, natural gas and NGL into the oil reservoirs to
enhance crude oil recovery. The use of tertiary recovery programs, such as
miscible floods, has increased the estimated amount of recoverable

18



---



##### 



crude oil-in-place from 50% to 70% of the original crude oil-in-place in
certain pools. As a consequence of implementing these natural gas and NGL
re-injection programs, historically only small volumes of gas and NGL have been
marketed from the Rainbow Lake area prior to 2002. In 2002, Husky initiated the
recovery of natural gas from several and pools. NGL recovery is forecast to
begin in the 2005-2008 timeframe and is expected to generate revenues once
crude oil production from the pools is complete. Husky uses horizontal drilling
techniques, including the re-entry of existing wellbores, to maintain crude oil
production and to increase recovery rates. Husky is continuing exploration
efforts to supplement its development initiatives in the Rainbow Lake area.
Huskys gross production from this area averaged 8.8 mbbls/day of light crude
oil and NGL and 16.9 mmcf/day of natural gas during 2002.

Husky holds a 50% interest in, and operates, the Rainbow Lake processing plant.
The processing design rate capacity of the plant is 69 mbbls/day of crude oil
and water and 230 mmcf/day of raw gas. The extraction design capacity is 17
mbbls/day of NGL. The plant currently is operating at near capacity levels. A
100 mmcf/day high inlet pressure plant expansion was commissioned in the fourth
quarter of 2001 to accelerate oil recovery, and to accommodate additional gas
volumes resulting from the exploration effort.

Peace River Arch Area

The Peace River Arch area of northern Alberta, which includes the Red Earth,
Seal, Utikuma, Lubicon and other properties, is a major light oil producing
area located approximately 370 kilometres north-west of Edmonton. Husky
operates and holds an average 80% working interest in several properties in
this area. Over the last three years, Husky has maintained gross production
from properties in this area, at approximately 3.8 mbbls/day of crude oil,
through acquisitions, stepout drilling and waterflood optimization. Husky plans
to increase its exploration for both crude oil and natural gas targets in this
area.

Boyer Area

The Boyer area of Alberta is approximately 600 kilometres north-west of
Edmonton, Alberta. Husky is the operator and holds approximately 450,000 net
acres. The area holds a shallow, Bluesky gas reservoir that is characterized
as low deliverability and low decline that is being developed with a drilling
density of two wells per section. Husky intends to continue to develop this
area by drilling undeveloped sections and infill drilling. Gross production
from this area in 2002 averaged 26 mmcf/day of natural gas.

Sloat Creek Area

The Sloat Creek or Chinchaga area of Alberta is located close to the British
Columbia border approximately 570 kilometres north-west of Edmonton, Alberta.
Husky is the operator and holds an approximate 95% working interest in 230,000
acres of gas prone land. The Bluesky, DeBolt, Elkton and Shunda zones that lie
an average of approximately 1,030 metres deep and the Slave Point zone at an
average depth of 1,800 metres characterize the area. Husky intends to continue
to develop this area with infill, stepout and exploratory drilling so that
existing pools can be optimized and new pools can be placed on production.

Husky owns a 30 mmcf/day high pressure booster compression plant that feeds a
third party operated sour gas plant and is 50% owner in a 12 mmcf/day low
pressure booster that feeds a 40% owned sweet gas processing facility operated
by a third party. Gross production from this area averaged 16.4 mmcf/day of
natural gas in 2002.

Marten Hills Area

The Marten Hills Area of Alberta is located 212 kilometres north-west of
Edmonton, Alberta. Husky is the operator and holds 578,000 net acres of gas
prone land. The Clearwater, Colony, McMurray and Wabiskaw zones that lie at an
average depth of 600 metres characterize the area.

19



---



##### 



Husky intends to continue to develop this area with infill, stepout and
exploratory drilling so that existing pools can be optimized and new pools can
be placed on production.

Husky owns a 100% interest in a series
of nine sales compressor stations, a 95%
interest in a compressor station at Rock Island, a 37.5% interest in a third
party operated facility at Peerless and a 3% interest in the third party
operated Marten Hills unit. Husky also processes its 100% working interest
non-unit gas through the Marten Hills unit facility. Gross production from
this area averaged 43 mmcf/day of natural gas in 2002.

Cherpeta and Saleski Areas

The Cherpeta area of Alberta is located 230 kilometres north of Edmonton,
Alberta and the Saleski area is located approximately 140 kilometres further
north from Cherpeta. Husky is the operator and holds an interest in 580,000
net acres of gas prone land. The Nisku, Clearwater, Colony, McMurray and
Wabiskaw zones that lie at an average depth of 600 metres characterize the
area. The Grosmont zone that lies between 450 and 500 metres characterizes the
Saleski area. Husky intends to continue to develop this area with infill,
stepout and exploratory drilling so that existing pools can be optimized and
new pools can be placed on production.

Husky owns on average from 60-95% working interest in the Cherpeta area and 49%
of the Saleski area and operates a series of sales compressor stations, gas
plants and sales pipeline. Gross production from these areas averaged 39.5
mmcf/day of natural gas in 2002.

Simons Lake Area

The Simons Lake area of Alberta is located 386 kilometres north-west of
Edmonton, Alberta. Husky is the operator and holds 275,000 net acres of gas
prone land. The Bluesky, DeBolt, Elkton and Shunda zones that lie at an average
depth of 600 metres characterize the area.

Husky holds 100% working interest in a 10 mmcf/day sour gas processing facility
and 34% working interest in a high pressure booster station operated by a third
party that feeds a separate third party owned sour gas processing facility.
Gross production from this area averaged 6.3mmcf/day of natural gas in 2002.

BRITISH COLUMBIA AND FOOTHILLS

Ram River Area

The Ram River area is located in west central Alberta and includes the large
Blackstone, Ricinus and Clearwater/Limestone natural gas fields.

The Blackstone field is the most prolific of these fields and contains four
high deliverability natural gas wells, capable of combined raw gas production
of 122 mmcf/day. Husky holds a 34% interest in three unitized wells and a 50%
interest in a fourth well, and acts as the contract operator of the Blackstone
wells. Production from these wells is processed at the Husky operated Ram River
gas plant.

Husky holds an average 72% interest in, and is the operator of, the Ram River
sour gas plant and related processing facilities. The Ram River plant has the
capacity to process 622 mmcf/day of sour gas, resulting in sales gas capacity
of 525 mmcf/day. The plant also has the capacity to produce in excess of 2.8
mlt/day of sulphur from raw gas. During 2002, the plant operated at
approximately 90% of its design rate capacity. The Ram River plant processes in
excess of 11% of Huskys total gross natural gas production, which includes an
average of 40.0 mmcf/day of Husky gross sales gas from the Blackstone, Brown
Creek and Stolberg fields and an average of 23.6 mmcf/day of Husky production
from Ricinus and Clearwater/Limestone and Benjamin

20



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##### 



fields, in addition to processing third-party volumes. In addition, gross
production from Ferrier, which is processed at another gas plant, averaged 3.3
mmcf/day of natural gas bringing the total production of natural gas from the
Ram River area to 66.9 mmcf/day in 2002.

Huskys sour gas pipeline network supports the Ram River plant. Husky operates
a network of 845 kilometres of sour gas pipelines in the Ram River area and
holds a 30% interest in 684 kilometres of this pipeline system. The sour gas
processed at the Ram River plant is produced from 18 sour gas fields located as
far as 145 kilometres from the Ram River plant.

Husky believes that the Ram River plant and the extensive infrastructure of
gathering pipelines, transmission systems and rail lines, which support the
plant, represents a strategic base for the natural gas exploration and
development planned by Husky in this part of the foothills region. In addition,
this region is an active exploration and production area for other producers
and provides additional opportunities for generating revenue by processing
third party natural gas.

Boundary Lake Area

Husky holds a 50% working interest in the Boundary Lake Gas Unit and 19% to 34%
interest in the Boundary Lake oil unit in north-east British Columbia. Huskys
natural gas production from this area is derived from five Belloy sour gas
pools, which is processed at the nearby Boundary Lake processing plant. Huskys
gross production from this area was 17 mmcf/day of natural gas and 2.2
mbbls/day crude oil and NGL from the Boundary Lake units during 2002.

Valhalla and Wapiti Area

Husky holds a 30% interest in three Valhalla oil units, a 100% interest in 350
Valhalla non-unit waterflood wells and a 100% interest in the Wapiti property.
Production is primarily from the Doe Creek and Cardium zones and consists of
light crude oil, natural gas liquids and natural gas. Huskys gross production
from these properties averaged 5.5 mbbls/day of crude oil and NGL and 7.3
mmcf/day of natural gas in 2002.

Caroline Area

Husky holds an 11% working interest in the 32,000 acre Caroline natural gas
field located approximately 97 kilometres north-west of Calgary. The field has
a high proportion of NGL and as a result the economics of this field are
enhanced.

Husky also holds an 11% interest in the Caroline sour gas processing facility.
The plant is presently running at a license limit of 118% of design capacity
and is processing approximately 129 mmcf/day of total plant sales gas and 45
mbbls/day of NGL. The plant and liquid acceleration gas recycle plant were at
97% capacity in 2002 which resulted in Husky gross production of 4.9 mbbls/day
NGL and 13.9 mmcf/day natural gas in 2002.

Edson Area

Husky holds an average 85% working interest in two gas processing facilities
and associated gas gathering systems in the Edson area. Husky operated lands in
the Edson area total approximately 56,000 gross acres. Husky has an interest in
approximately 150 Cardium wells in this area that averaged gross production of
29.5 mmcf/day of natural gas and 1.3 mbbls/day of NGL in 2002.

Sikanni Area

Husky holds approximately 32,000 net acres in the Sikanni and Federal area of
north-east British Columbia, which averaged gross production of 26.5 mmcf/day
of natural gas from four wells in 2002. The production flows through Husky
owned gathering systems for processing at third party plants at the Sikanni and
McMahon gas plants.

21



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EAST CENTRAL ALBERTA

Athabasca Area

The Athabasca area is located north of Edmonton up to township 70 in the north
and from the Alberta-Saskatchewan border in the east to the Alberta foothills
in the west. The area target is predominantly shallow gas, ranging from 455 to
910 metres, in the multi-zone Palaeozoic Mannville. The main producing areas
are Athabasca, Craigend and Cold Lake. Husky operates 31 facilities with an
extensive pipeline system with an average working interest of 90% in the
producing wells. Husky intends to continue to develop this area with infill,
stepout and exploratory wells to optimize recovery and develop new pools in
order to keep the facilities operating at capacity. Huskys gross production
from this area averaged 59 mmcf/day of natural gas and 700 bbls/day of crude
oil in 2002.

Red Deer and Hussar Area

The Red Deer and Hussar area falls between township 23-50 and range 1W4-5W5
with the core of the area between Calgary, Drumheller and Sylvan Lake. Husky
operates 18 facilities with extensive gas gathering systems in this area. In
2002 gross production from this area averaged 61 mmcf/day of natural gas and
crude oil and NGL of 3.0 mbbls/day. Husky intends to continue to develop the
natural gas potential of this area with infill, stepout and exploratory wells
to optimize gas recovery and develop new pools in order to operate the
facilities at capacity.

Provost Area

The centre of the Provost area is approximately 240 kilometres south-east of
Edmonton. It is predominantly a medium crude oil area that averaged gross
production of approximately 25 mbbls/day of crude oil and 13 mmcf/day of
natural gas in 2002. Husky intends to selectively drill lower risk oil
locations and focus on managing operating costs and improving oil recovery.
There is significant competition in the area for land as well as
infrastructure. Husky has a dominant position and maintains close to 100%
working interest in most of its facilities.

SOUTHERN ALBERTA AND SASKATCHEWAN

In Southern Alberta and Saskatchewan the Company sold properties, which were
producing approximately 7,000  7,500 boe/day effective October 1, 2002. As
of December 31, 2002, the Company held 1.45 million net acres in Saskatchewan
and 370,000 net acres in Alberta. The Company also has a small holding in
Manitoba.

Southern Saskatchewan Area

Husky is a prominent operator in south-western Saskatchewan primarily producing
medium gravity crude oil, with some natural gas and light crude oil. During
2002, gross production from this area averaged 20.2 mbbls/day of crude oil and
of 21.9 mmcf/day of natural gas. Properties in south-eastern Saskatchewan
produced 1.1 mbbls/day of crude oil per day in 2002.

Husky operates 31 oil batteries and six gas facilities in the Southern
Saskatchewan area. The oil pools in this area are exploited using pressure
maintenance and waterflood recovery operations.

The Shackleton/Lacadena Milk River shallow gas project was accelerated in the
last half of 2002. During that period 144 wells were drilled and two new gas
facilities were built. As a result, the project was producing at a rate of 28
mmcf/day at December 31, 2002 (average December monthly production was 23
mmcf/day).

22



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Southern Alberta Area

Taber, Brooks and Jenner/Suffield are Huskys three core areas in southern
Alberta. Husky operates 28 oil facilities and three natural gas facilities
with an average working interest of 95%. Oil production is mainly medium
gravity crude with the majority of reserves being supported by waterfloods or
active aquifers. Natural gas production is from a mixture of deep and shallow
formations. At Taber, Husky is operating an alkaline-polymer flood to increase
recovery from the Cretaceous Mannville reservoir. During 2002, gross
production from this area averaged 16.8 mbbls/day of crude oil and 15.8
mmcf/day of natural gas.

ATHABASCA, COLD LAKE AND PEACE RIVER

Husky currently holds interests in 430,609 acres in the bitumen prone areas of
Athabasca, Cold Lake and Peace River. Husky is currently conducting evaluation
drilling and production feasibility studies in the Cold Lake and Athabasca
areas. Recent improvements in fiscal regimes for these types of project,
together with advances in technology which have reduced costs for in situ
projects, have enhanced the commercial viability of these projects. In situ
projects are currently being designed for the Tucker and Kearl areas.

In the Athabasca area, Husky and its co-venturer recently completed an asset
exchange of the Kearl properties in December 2002. Under the terms of the asset
exchange, Husky increased its working interest in the in situ project area from
approximately 80% to 100%. Husky also acquired an additional 25.5 net sections
of 100% interest land adjacent to the project area. In exchange Husky divested
its entire interest in the area designated for bitumen mining. This arrangement
is expected to improve the efficiency of the exploitation of the bitumen
resource.

In addition to interests in the 350,929 net acres in the Cold Lake and
Athabasca regions in north-eastern Alberta, Husky holds an interest in 79,680
net acres in the Peace River region of northern Alberta.

|                                     |  |             |  |       |         |       |         |          |         |  |         |     |  |  |  | 
|------------------------------------ |  | ----------- |  | ----- | ------- | ----- | ------- | -------- | ------- |  | ------- | --- |  |  |  | 
|                                     |  | Oil Sand    |  | Gross |         | Net   |         | Husky   
|General Location Name                |  | Area        |  | Acres |         | Acres |         | Operator
|                                     |  |             |  |       |         |       |         |         
|South Athabasca over riding royalty |  | Athabasca   |  |       | 35,705  |       |         |          |        |  |         | No 
|South Athabasca                      |  | Athabasca   |  |       | 33,058  |       |         |          | 16,529  |  |         | Yes
|Kearl  Insitu                       |  | Athabasca   |  |       | 56,800  |       |         |          | 56,800  |  |         | Yes
|Misthae                              |  | Athabasca   |  |       | 28,160  |       |         |          | 28,160  |  |         | Yes
|Saleski                              |  | Athabasca   |  |       | 154,880 |       |         |          | 154,880 |  |         | Yes
|Beaverdam                            |  | Cold Lake   |  |       | 11,520  |       |         |          | 11,520  |  |         | Yes
|Caribou                              |  | Cold Lake   |  |       | 35,840  |       |         |          | 35,840  |  |         | Yes
|Lobstick                             |  | Cold Lake   |  |       | 37,120  |       |         |          | 37,120  |  |         | Yes
|Tucker                               |  | Cold Lake   |  |       | 10,080  |       |         |          | 10,080  |  |         | Yes
|Panny                                |  | Peace River |  |       | 47,360  |       |         |          | 47,360  |  |         | Yes
|Peace River                          |  | Peace River |  |       | 11,840  |       |         |          | 11,840  |  |         | Yes
|Sawn Lake                            |  | Peace River |  |       | 20,480  |       |         |          | 20,480  |  |         | Yes
|                                     |  |             |  |       |         |       |         |          |         |  |         |     |  |  |  | 
|                                     |  |             |  |       |         |       | 482,843 |          |         |  | 430,609 |     |  |  |  | 
|                                     |  |             |  |       |         |       |         |          |         |  |         |     |  |  |  | 

Note:



---

|(1) |  | Husky also has the exclusive right to acquire an additional 65,280 acres in the Caribou area.
|--- |  | ---------------------------------------------------------------------------------------------

23



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(OFFSHORE MAP)

OFFSHORE EAST COAST  CANADA

Huskys offshore east coast exploration and development program is focused
primarily in the Jeanne dArc basin on the Grand Banks offshore the coast of
Newfoundland, which contains the Hibernia, Terra Nova and White Rose oil
fields. Husky has ownership interests in the Terra Nova and White Rose oil
fields as well as in a number of smaller fields in the central part of the
basin. Husky presently holds an approximate 36% average working interest in 12
Significant Discovery License (SDL) areas in the Jeanne dArc basin and a 21%
average working interest in nine Exploration Licenses on the Grand Banks. Husky
believes that its geotechnical expertise, drilling experience and extensive
database with respect to offshore the east coast of Canada provide a strong
foundation for future development. Husky believes that there is exploration
potential in the area, and that its position off the east coast of Canada will
provide growth opportunities for light crude oil production in the medium to
long-term.

In 2002 Husky drilled two exploration wells in the Jeanne dArc Basin. A well
(EL1044) was drilled on the Trepassey Exploration Licence and a well (EL 1055)
was drilled on the Gros Morne Exploration Licence. Both structures were water
bearing in the main reservoir zone. At Trepassey, hydrocarbons were encountered
in a secondary zone, although not in commercial quantities.

24



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Grand Banks  Jeanne dArc Basin

(GRAND BANKS MAP)

25



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Terra Nova Oil Field

The Terra Nova oil field is located approximately 350 kilometres east
south-east of St. Johns, Newfoundland, 35 kilometres south-east of the
Hibernia oil field, in 91 to 100 metres of water. The Terra Nova oil field is
divided into three distinct areas, known as the Graben, the East Flank and the
Far East areas.

As at December 31, 2002, there were six development wells drilled in the Graben
area, three producing wells and three injection wells. In the East Flank area
there were also three producing wells and three injection wells drilled.
Drilling operations will continue with a 24 well depletion plan for the Graben
and East Flank areas. A delineation well in the Far East Block encountered 82
metres of net pay confirming the reserve sands extend to this area and may
provide additional reserves. A second well, that was intended to be a water
injection well, was drilled in the Far East block. This well encountered poor
porosity in the target horizon and was plugged back. The well may be re-drilled
to a different location in the future. A third well may be drilled in the Far
East block during 2003. During 2002, Husky booked 31.0 million barrels of crude
oil to the proved oil reserves category. These reserves are estimated to be
capable of being produced using primary and secondary (waterflood and gasflood)
production techniques.

Huskys initial pooled interest in the Terra Nova field was 17.5%, which was
subsequently reduced to 12.51% by a property exchange transaction in early
2000. This interest is subject to change, pending redetermination once the
field has been further delineated. Production at Terra Nova commenced in
January 2002 with an initial production rate of 110 mbbls/day of oil and
averaged approximately 145 mbbls/day in the fourth quarter of 2002. Huskys
share of production from Terra Nova was 4.8 million barrels in 2002.

White Rose Oil Field

The White Rose oil field, which is operated by Husky, is located 354 kilometres
off the coast of Newfoundland, approximately 48 kilometres east of the Hibernia
field on the eastern portion of the Jeanne dArc basin.

During 2001, Husky awarded the front end engineering design contracts for a
floating production storage and offloading system, the subsea production system
and the glory hole, a deep excavation in the sea bed to protect well heads from
iceberg incursion. In that same year, a contract was entered into for the
design and construction of the glory hole long lead excavation equipment. Lump
sum bids were also received for the floating production storage offloading
system subcontracts (comprised of hull, topsides and turret).

Husky filed a development application with Canada-Newfoundland Offshore
Petroleum Board in January 2001. Following formal public review hearings, the
project received the requisite regulatory approvals in December 2001 from the
Canada-Newfoundland Offshore Petroleum Board, Provincial Government and Federal
Government. In March 2002, Husky and its co-venturer announced their decision
to proceed with the development of the White Rose oil field. Current plans
provide for a total of 19 to 21 wells to be drilled to recover crude oil over a
10 to 15 year period. Annualized peak production is expected to be
approximately 92,000 barrels of oil per day sustained for approximately four
years. Excavation of the subsea glory holes commenced in the third quarter of
2002 and will recommence in the first half of 2003. Development drilling is
expected to commence in the second half of 2003. Engineering, procurement and
construction of the floating production, storage and offloading vessel and
subsea facilities are progressing.

26



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INTERNATIONAL

Offshore China

Wenchang

On October 13, 2000, Husky signed a petroleum contract with the China National
Offshore Oil Corporation (CNOOC) to develop two oil fields in the South China Sea.
The oil fields are located in the western Pearl River Mouth Basin,
approximately 300 kilometres south of Hong Kong and 135 kilometres east of
Hainan Island.

The project was completed and commenced production in July 2002. The Company
holds a 40% working interest in the project and spent approximately $253
million to first oil. The Wenchang 13-1 and 13-2 oil fields are producing from
fixed platforms and 21 producing wells in 100 metres of water into a floating
production, storage and offloading vessel stationed between the fields. The
blended crude oil from the two fields averages approximately 35° API, similar
to the benchmark Minas blend. At December 31, 2002 Huskys proved reserves at
Wenchang amounted to 30.1 mmbbls of crude oil. Production from first oil in
July 2002 to December 31, 2002 averaged 25.3 mbbls/day.

Block 39-05

Husky executed a production sharing contract with CNOOC for the 5,740 square
kilometres 39-05 Exploration Block surrounding the Wenchang 13-1/2 fields.
Husky has committed to drill three exploration wells within seven years and
CNOOC has the right to participate in development of any discoveries up to a
51% working interest. In January 2003 the Qionghai 18-1-3 exploration well was
plugged and abandoned without testing and in February 2003 the Wenchang 8-1-1
was plugged and abandoned without testing.

Blocks 23-15 and 23-20

Husky executed a production sharing contract for the 23-15 and 23-20
exploration blocks in September 2002. Both leases are located in the South
China Sea north of Hainan, within 80 kilometres of the Weizhan oil fields. The
23-15 lease is 1,327 square kilometres and the 23-20 lease is 1,543 square
kilometres. The work program requires Husky to drill a single exploration well
in each lease within three years. CNOOC has the right to participate in
development of any discoveries up to a 51% working interest.

Block 40-30

Husky executed a production sharing contract for the 40-30 exploration block in
December 2002. The lease is located in the South China Sea approximately 100
kilometres south of the 13-1 and 13-2 oil fields. The lease is 6,704 square
kilometres and requires the drilling of one exploration well within three
years. CNOOC has the right to participate in development of any discoveries up
to a 51% working interest.

27



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(SOUTH CHINA SEA MAP)

Madura Strait, Indonesia

Husky is party to a production sharing contract, which provides for various
cost and production sharing arrangements, relating to a 690,412 acre block in
the Madura Strait offshore Java, Indonesia. Ten exploration and appraisal wells
have been drilled in the block, resulting in discoveries of two natural gas
fields. The Indonesian state oil company granted commercial status and approved
a plan of development for one of these fields in order to supply natural gas to
a proposed independent power plant near Pasuruan, East Java. Husky and its
co-venturer signed a gas supply agreement for the development in September
1997. However, the construction of the power plant and development of the
natural gas field have been postponed pending resolution of energy market and
finance issues arising from the economic conditions in Indonesia that occurred
shortly after the contract was signed. In January 2003, Husky signed a
memorandum of understanding to begin discussions intended to finalize a natural
gas sales agreement for Madura production.

Shatirah, Libya

Husky has an interest in a minor crude oil production operation in the Shatirah
field, onshore Libya.

28



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DISTRIBUTION OF OIL AND GAS PRODUCTION

Crude Oil and NGL

Husky provides heavy crude oil feedstock to its upgrader and its asphalt
refinery, which are located at Lloydminster. The combined dry crude feedstock
requirements of the upgrader and asphalt refinery are equal to approximately
85% of Huskys heavy crude oil production from the Lloydminster area. Husky
also markets heavy crude oil production directly to refiners located in the
U.S. mid-west and eastern U.S. and Canada. Husky markets its light and
synthetic crude oil production to third party refiners in both Canada and the
United States. Natural gas liquids are sold to local petrochemical end users
and refiners in North America.

Husky markets a significant amount of third party volumes of light crude oil,
heavy crude oil and NGL in addition to its own production.

Natural Gas

The following table shows the distribution of Huskys gross average daily
natural gas production for the years indicated:

|                     |               |  |                          |     |      |  |      |     |  |  |     |     | 
|-------------------- | ------------- |  | ------------------------ | --- | ---- |  | ---- | --- |  |  | --- | --- | 
|                     |               |  | Years ended December 31,
|                     |               |  |                         
|                     |               |  | 2002                     |     | 2001 |  | 2000
|                     |               |  |                          |     |      |  |     
|                     |               |  | (mmcf/day)              
|Sales to end users   |               |  |                          |     |      |  |      |     |  |  |     |    
|                     | United States |  |                          | 375 |      |  |      | 413 |  |  |     | 240 | 
|                     | Canada        |  |                          | 115 |      |  |      | 106 |  |  |     | 81  | 
|                     |               |  |                          |     |      |  |      |     |  |  |     |    
|                     |               |  | 490                      |     |      |  | 519  |     |  |  | 321 |    
|Sales to aggregators |               |  | 49                       |     |      |  | 40   |     |  |  | 25  |    
|Internal use(1)      |               |  | 30                       |     |      |  | 14   |     |  |  | 12  |    
|                     |               |  |                          |     |      |  |      |     |  |  |     |    
|                     |               |  | 569                      |     |      |  | 573  |     |  |  | 358 |    
|                     |               |  |                          |     |      |  |      |     |  |  |     |    

Note:



---

|(1) |  | Husky consumes natural gas for fuel at several of its facilities.
|--- |  | -----------------------------------------------------------------

Husky also markets a significant volume of third party natural gas production
in addition to its own production.

Midstream Operations

Overview

The midstream operations of Husky include upgrading of heavy crude oil
feedstock into synthetic crude oil (Upgrading), pipeline transportation and
processing of heavy crude oil, storage of crude oil, diluent and natural gas,
extraction of NGL from natural gas, cogeneration of electrical and thermal
energy (Infrastructure) and the purchase and marketing of Huskys and other
producers crude oil, natural gas, natural gas liquids, sulphur, petroleum coke
and electrical power (Marketing).

29



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Upgrading Operations

Husky owns and operates the Husky Lloydminster Upgrader, which is a heavy oil
upgrading facility located in Lloydminster, Saskatchewan.

The Husky Lloydminster Upgrader is designed to process blended heavy crude oil
feedstock into high quality, low sulphur synthetic crude oil. Synthetic crude
oil is used as feedstock for the refining of premium transportation fuels in
Canada and the United States. In addition, the Husky Lloydminster Upgrader
recovers the diluent, which facilitates pipeline transportation of heavy crude
oil, from the blended heavy oil feedstock.

The Husky Lloydminster Upgrader has created a new market for heavy crude oil in
Western Canada, which Husky believes has facilitated, and will continue to
stimulate, heavy oil production in the area. The Husky Lloydminster Upgrader
was commissioned in 1992 with an original design capacity of 46 mbbls/day of
synthetic crude oil. Actual production has ranged considerably higher than the
original design rate capacity as a result of throughput modifications and
improved reliability. The upgraders current rated capacity is 54 mbbls/day.
Production at the upgrader averaged 55.7 mbbls/day of synthetic crude oil and
9.7 mbbls/day of diluent in 2002 compared with 59.8 mbbls/day of synthetic
crude oil and 11.8 mbbls/day of diluent in 2001. Throughput at the upgrader in
2002 was lower than 2001 due to a scheduled maintenance turnaround during 2002.
In addition to synthetic crude oil and diluent, the Husky Lloydminster Upgrader
also produced, as by-products of its upgrading operations, approximately 311
lt/day of sulphur and 760 lt/day of petroleum coke during 2002. These products
are sold in local and international markets. The profitability of Huskys
upgrading operations is primarily dependent upon the differential between the
price of synthetic crude oil and the price of heavy crude oil.

Infrastructure and Marketing

HEAVY OIL PIPELINE SYSTEMS AND PROCESSING FACILITIES

Husky has been involved in the gathering, transporting and storage of heavy
crude oil in the Lloydminster area since the early 1960s. Huskys crude oil
pipeline systems include approximately 1,900 kilometres of pipeline and are
capable of transporting in excess of 528 mbbls/day of blended heavy crude oil,
diluent and synthetic crude oil. The pipeline systems transport blended heavy
crude oil to Lloydminster, accessing markets through the Husky
Lloydminster Upgrader and Huskys asphalt refinery in Lloydminster. Blended
heavy crude oil and synthetic crude oil from the upgrading operations are moved
south to Hardisty, Alberta to a connection to the Enbridge Pipeline system and
the Express Pipeline system. The crude oil is transported to eastern and
southern markets on these pipelines. Huskys crude oil pipeline systems also
have feeder pipeline interconnections with the Cold Lake Partnership Pipeline
the Enbridge Athabasca Pipeline and the Talisman Chauvin Pipeline.

The following table shows the average daily pipeline throughput for the periods
indicated:

|                             |  |                          |     |      |  |      |     |  |  |  |     | 
|---------------------------- |  | ------------------------ | --- | ---- |  | ---- | --- |  |  |  | --- | 
|                             |  | Years ended December 31,
|                             |  |                         
|                             |  | 2002                     |     | 2001 |  | 2000
|                             |  |                          |     |      |  |     
|                             |  | (mbbls/day)             
|Combined pipeline throughput |  |                          | 457 |      |  |      | 537 |  |  |  | 528 | 

In recent years Husky has expanded and expects to further expand its heavy
crude pipeline systems to capitalize on anticipated increases in heavy oil
production from the Lloydminster and Cold Lake areas. Husky considers the
expansion and optimization of its pipeline systems in the

30



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##### 



Lloydminster area to
be necessary to further its own development objectives in the area. As a
result of recent expansion of mainline pipeline systems in the area,
competition for throughput volumes has increased.

Husky operates 16 heavy crude oil processing facilities located throughout the
Lloydminster area. These facilities process Huskys and other producers raw
heavy crude oil from the field by removing sand, water and other impurities to
produce clean dry heavy crude oil. The heavy crude oil is then blended with a
diluent to meet pipeline specifications for transportation.

(HEAVY OIL MAP)

31



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COGENERATION

Husky has a 50% interest in a 215 MW natural gas fired cogeneration facility at
the site of the Husky Lloydminster Upgrader. The plant was commissioned in
December 1999. Electricity produced at the facility is being sold to
Saskatchewan Power Corporation under a 25 year power purchase agreement.
Thermal energy (steam) is sold to the Husky Lloydminster Upgrader.

Husky has a 50% interest in a 90 MW natural gas fired cogeneration facility
adjacent to Huskys Rainbow Lake processing plant. The cogeneration plant
produces electricity for the Alberta Power Pool and thermal energy (steam) for
the Rainbow Lake processing plant. It provides power directly to the Alberta
Power Pool and is the result of an agreement with the Alberta Transmission
Administrator to provide additional electricity generating capacity and system
stability for north-western Alberta. The power plant has the capability of
being expanded to approximately 110 MW in total. Husky is the operator of the
facility.

NATURAL GAS STORAGE FACILITIES

Husky has been operating a natural gas storage facility at Hussar, Alberta
since April 2000. The facility has a working storage capacity of 17 bcf of
natural gas. Husky is continuing to evaluate additional storage opportunities
within Western Canada. Western Canada and Alberta in particular, may prove to
be a potential key storage hub for arctic gas development.

MARKETING

Husky is a marketer of both its own and third party production of crude oil,
synthetic crude oil, NGL, natural gas and sulphur. Husky also markets
petroleum coke, a by-product from the Lloydminster upgrader. Husky supplies
feedstock to its upgrader and asphalt refinery from its own and third party
heavy oil production sourced from the Lloydminster and Cold Lake areas. Husky
also sells blended heavy crude oil directly to refiners based in the United
States and Canada. Huskys extensive infrastructure in the Lloydminster area
supports its heavy crude oil refining and marketing operations.

Husky markets light and medium crude oil and NGL sourced from its own
production and third party production. Light crude oil is acquired for
processing by third party refiners at Edmonton, Alberta and by the Companys
refinery at Prince George, British Columbia. Husky markets the synthetic crude
oil produced at its upgrader in Lloydminster to refiners in Canada and the
United States.

Husky markets natural gas sourced from its own production and third party
production. Husky is currently committed to contracts with third parties,
which in aggregate do not exceed amounts forecast to be deliverable from
Huskys reserves. Huskys contracts are with customers located in eastern
Canada/north-eastern United States (27%), mid-west United States (34%), Western
Canada (30%) and west coast United States (9%). The natural gas volumes
contracted are primarily at market price (92%). The terms of the contracts are
up to one year (50%), one year to five years (15%) and over five years (35%).
Husky has acquired rights to firm pipeline capacity to transport the natural
gas to most of these markets.

The oil and gas product marketing component of Huskys business has experienced
strong growth since the early 1990s. Husky has developed its marketing
operations to include the acquisition of third party volumes in order to
increase growing internal natural gas demand, increase volumes and enhance the
value of its midstream assets. Husky plans to expand its marketing operations
by continuing to increase marketing activities. Husky believes that this
increase will generate synergies with the marketing of its own production
volumes and the optimization of its assets.

32



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##### 



Refined Products

Overview

Huskys refined products operations include refining and retail, commercial and
wholesale marketing of refined petroleum products. This network provides a
platform for substantial non-fuel related businesses.

Light oil refined products are produced at Huskys refinery at Prince George,
British Columbia and are also acquired from other third party refiners and
marketed through Husky and Mohawk branded retail and commercial petroleum
outlets and through direct marketing to third party dealers and end users.
Asphalt and residual products are produced at Huskys asphalt refinery at
Lloydminster, Alberta and marketed directly or through Huskys 10 terminals
located throughout Western Canada.

(CANADA MAP)

Branded Petroleum Outlets and Commercial Distribution

DISTRIBUTION

As of December 31, 2002, there were 571 independently operated Husky and Mohawk
branded petroleum outlets, including service stations, truck stops and bulk
distribution facilities located from Vancouver Island on the west coast of
Canada to the eastern border of Ontario. The truck stop network is
strategically located on major highways and serves the retail market and
commercial transporters 24 hours per day, 365 days per year with quality
products and full service Husky House restaurants. At most locations, the truck
stop network also features the proprietary Route Commander cardlock system
that enables commercial users to purchase

33



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##### 



products using a card system that
will electronically process transactions and provide detailed billing, sales
tax and other information. A variety of full and self serve retail locations
under the Mohawk and Husky brand names serve urban and rural markets, while
Husky and Mohawk bulk distributors offer direct sales to commercial and farm
markets in Western Canada.

Independent retailers or agents operate all Husky and Mohawk branded outlets.
Branded outlets feature varying services such as 24 hour service, convenience
stores, service bays, car washes, Husky House full service family style
restaurants, proprietary and co-branded quick serve restaurants, bank machines
and alternate fuels such as propane and compressed natural gas. In addition to
conventional gasolines, ethanol blended fuels branded as Mother Natures
gasoline and additive enhanced Diesel Max are offered in selected markets
together with Chevron and Mohawk lubricants. Husky supplies refined petroleum
products to its branded independent retailers on an exclusive basis and also
provides financial and other assistance for location improvements, marketing
support and related services. Huskys brands are promoted through various
national and university athletic sponsorships as well as advertising designed
to reach both national and regional audiences.

The following table shows the number of Husky and Mohawk branded petroleum
outlets by class of trade and by province as of December 31, 2002.

|                          |                  |       |            |  |  |  |     |         |  |              |     |          |  |         |    |       |  |  |    |    |  |  |    |    |  |  |     |     | 
|------------------------- | ---------------- | ----- | ---------- |  |  |  | --- | ------- |  | ------------ | --- | -------- |  | ------- | -- | ----- |  |  | -- | -- |  |  | -- | -- |  |  | --- | --- | 
|                          |                  |       | British    |  |  |  |     |         |  |              |     |          |  |         |    |       |  |  |    |    |  |  |    |    |  |  |    
|                          |                  |       | Columbia & |  |  |  |     |         |  |              |     |          |  |         |    |       |  |  |    |    |  |  |    |    |  |  |    
|Branded Petroleum Outlets |                  | Yukon |            |  |  |  |     | Alberta |  | Saskatchewan |     | Manitoba |  | Ontario |    | Total
|                          |                  |       |            |  |  |  |     |         |  |              |     |          |  |         |    |      
|                          | Truck Stops      |       |            |  |  |  |     | 7       |  |              |     | 5        |  |         |    | 5     |  |  |    | 2  |  |  |    | 17 |  |  |     | 36  | 
|                          | Travel Stops     |       |            |  |  |  |     | 2       |  |              |     | 3        |  |         |    |       |  |  |    |    |  |  |    | 2  |  |  |     | 7   | 
|                          | Full Serve       |       |            |  |  |  |     | 60      |  |              |     | 71       |  |         |    | 21    |  |  |    | 31 |  |  |    | 7  |  |  |     | 190 | 
|                          | Full/Self Serve  |       |            |  |  |  |     | 62      |  |              |     | 58       |  |         |    | 7     |  |  |    | 19 |  |  |    | 10 |  |  |     | 156 | 
|                          | Self Serve       |       |            |  |  |  |     | 63      |  |              |     | 74       |  |         |    | 11    |  |  |    | 6  |  |  |    | 3  |  |  |     | 157 | 
|                          | Bulk Distributor |       |            |  |  |  |     | 5       |  |              |     | 13       |  |         |    | 5     |  |  |    | 1  |  |  |    | 1  |  |  |     | 25  | 
|                          |                  |       |            |  |  |  |     |         |  |              |     |          |  |         |    |       |  |  |    |    |  |  |    |    |  |  |     |    
|                          |                  |       |            |  |  |  | 199 |         |  |              | 224 |          |  |         | 49 |       |  |  | 59 |    |  |  | 40 |    |  |  | 571 |    
|                          |                  |       |            |  |  |  |     |         |  |              |     |          |  |         |    |       |  |  |    |    |  |  |    |    |  |  |     |    
|Cardlocks(1)              |                  |       |            |  |  |  | 18  |         |  |              | 14  |          |  |         | 6  |       |  |  | 4  |    |  |  | 20 |    |  |  | 62  |    
|Convenience Stores(1)     |                  |       |            |  |  |  | 152 |         |  |              | 177 |          |  |         | 50 |       |  |  | 48 |    |  |  | 11 |    |  |  | 438 |    
|Restaurants(2)            |                  |       |            |  |  |  | 10  |         |  |              | 9   |          |  |         | 6  |       |  |  | 2  |    |  |  | 18 |    |  |  | 45  |    

Notes:



---

|(1) |  | All of these are located at a branded petroleum outlet.                             
|--- |  | ------------------------------------------------------------------------------------
|   
|(2) |  | One Husky House restaurant in Calgary, Alberta is not located at a
petroleum outlet.

Husky also markets refined petroleum products directly to various commercial
markets, including independent dealers, national rail companies and major
industrial and commercial customers in Western Canada and the north-western
United States.

The following table shows Huskys average daily sales volumes of light refined
petroleum products for the periods indicated:

|                        |  |                          |      |      |  |      |      |  |  |  |      | 
|----------------------- |  | ------------------------ | ---- | ---- |  | ---- | ---- |  |  |  | ---- | 
|                        |  | Years ended December 31,
|                        |  |                         
|                        |  | 2002                     |      | 2001 |  | 2000
|                        |  |                          |      |      |  |     
|                        |  | (mbbls/day)             
|Gasoline                |  |                          | 26.3 |      |  |      | 25.4 |  |  |  | 24.9 | 
|Diesel fuel             |  |                          | 20.7 |      |  |      | 21.1 |  |  |  | 20.3 | 
|Liquefied petroleum gas |  |                          | 1.3  |      |  |      | 1.3  |  |  |  | 1.6  | 
|                        |  |                          |      |      |  |      |      |  |  |  |      | 
|                        |  |                          | 48.3 |      |  |      | 47.8 |  |  |  | 46.8 | 
|                        |  |                          |      |      |  |      |      |  |  |  |      | 

34



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##### 



Huskys current strategy in respect of its petroleum product outlets includes
continuing to increase profits and sales through the strategic location of new
outlets, the enhancement of ancillary non-fuel income streams, the
modernization, automation and upgrading of existing petroleum product outlets,
expanding customer loyalty programs and the sale of non-core locations. Husky
also plans to continue to enter into strategic alliances with third parties to
sell various consumer products at Husky and Mohawk branded petroleum outlets in
order to generate revenue and increase demand for other products and services
provided at those outlets. Husky is pursuing acquisitions and joint venture
opportunities to further enhance its existing distribution network.

SUPPLY

Prince George Refinery.Husky owns and operates a refinery at Prince George,
British Columbia, which has capacity to refine more than 10,000 bbls/day of
light crude oil into a full range of refined petroleum products. The crude oil
feedstock for the Prince George refinery is produced primarily in north-eastern
British Columbia by other producers and delivered to Huskys refinery by
pipeline. Husky is pursuing acquisitions and joint venture opportunities to
further enhance its existing refining capacity.

Other Supply Arrangements.In addition to the refined petroleum products
supplied by the Prince George refinery, Husky has established processing
arrangements with other refiners. Processing arrangements allow Husky to
participate in industry refining margins. Primarily Husky production and some
third party purchased crude oil is delivered to refiners, who process the crude
oil into refined products, which are then marketed by Husky in its retail
networks and to its wholesale customers. During 2002, these refiners processed
an average of approximately 30.9 mbbls/day of crude oil for Husky, yielding
approximately 27.8 mbbls/day of refined petroleum products. During 2002, Husky
also purchased approximately 9.6 mbbls/day of refined petroleum
products from refiners and acquired approximately 6.5 mbbls/day of refined
petroleum products pursuant to exchange agreements with third party refiners.

Minnedosa, Manitoba  Ethanol Plant.Husky owns an ethanol plant at Minnedosa,
Manitoba that produces 10 million litres per year. Ethanol is an oxygenate
derived from biomass, which, when added to gasoline, promotes fuel combustion,
raises octane levels and inhibits water from freezing in fuel lines. The
ethanol blended gasoline (Mother Natures Fuel) has received federal government
recognition for its low combustion emissions. Husky is actively repositioning
its supply of ethanol as ethanol-blended gasoline is now available at all Husky
and Mohawk outlets.

Asphalt Products

Husky has been in the paving and specialty asphalt business for over 50 years.
Husky supplies asphalt products to customers across Western Canada and the
north-western and midwestern United States. Husky has a significant market
share for paving asphalt, emulsified asphalt and asphalt products sold in
Western Canada. Most of the asphalt sold is used for paving and other
industrial purposes. Huskys Pounder Emulsions division manufactures modified
and conventional road application emulsion products. Additional non-asphalt
based road maintenance products are marketed and distributed through the
Western Road Management division of Husky. Demand for higher quality asphalt
products has allowed Husky to increase sales into the United States and Eastern
Canada, with products occasionally being shipped as far away as Texas, Florida
and New Brunswick. In 2002, 49 percent of Huskys asphalt production was
exported to the United States. Husky plans to continue its efforts to improve
its asphalt business by increasing its modified asphalt production capacity to
produce better products at a lower cost. Husky is also studying the
feasibility of expanding its production and distribution capacity.

35



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##### 



Huskys asphalt distribution network consists of nine emulsion plants and
terminals located at Kamloops and Prince George, British Columbia; Watson Lake,
Yukon; Edmonton and Lethbridge, Alberta; Lloydminster, Saskatoon and Yorkton,
Saskatchewan; and Winnipeg, Manitoba. Husky also utilizes independent terminals
at Langley, British Columbia.

All of Huskys asphalt requirements are supplied by its Lloydminster, Alberta
asphalt refinery. The refinery was commissioned in 1983, replacing a Husky
facility that had been operating since 1947. The refinery was designed
specifically to produce asphalt from heavy crude oil at a rate of 25 mbbls/day.
The crude oil feedstock for the Lloydminster refinery is supplied through
Huskys pipeline systems from the supply of heavy crude oil in the region,
including Huskys heavy crude oil.

The following table shows the average daily sales volumes of products produced
at the Lloydminster refinery, for the years indicated:

|                   |  |                          |      |      |  |      |      |  |  |  |      | 
|------------------ |  | ------------------------ | ---- | ---- |  | ---- | ---- |  |  |  | ---- | 
|                   |  | Years ended December 31,
|                   |  |                         
|                   |  | 2002                     |      | 2001 |  | 2000
|                   |  |                          |      |      |  |     
|                   |  | (mbbls/day)             
|Asphalt            |  |                          | 12.7 |      |  |      | 12.6 |  |  |  | 12.0 | 
|Residual and other |  |                          | 8.1  |      |  |      | 8.8  |  |  |  | 8.2  | 
|                   |  |                          | 20.8 |      |  |      | 21.4 |  |  |  | 20.2 | 

Refinery throughput averaged 22.0 mbbls/day of blended heavy crude oil
feedstock during 2002. Diluent included in the feedstock, extracted and
returned to the field averaged 2.6 mbbls/day in
2002. Due to the seasonal demand for asphalt products the refinery
historically has operated at full capacity only during the normal paving season
in Canada and the northern United States. Husky has implemented various plans
to increase refinery throughput during the other months of the year, such as
producing low sulphur diesel, entering into custom processing arrangements and
developing other U.S. and international markets for asphalt products.

36



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##### 



HUMAN RESOURCES

The number of employees in each business segment was as follows:

|                               |  |                                     |       |      |  |  |       | 
|------------------------------ |  | ----------------------------------- | ----- | ---- |  |  | ----- | 
|                               |  | Number of Employees at December 31,
|                               |  |                                    
|Business Segment               |  | 2002                                |       | 2001
|                               |  |                                     |       |     
|Upstream                       |  |                                     | 1,560 |      |  |  | 1,451 | 
|Midstream                      |  |                                     | 344   |      |  |  | 314   | 
|Refined Products               |  |                                     | 329   |      |  |  | 332   | 
|Corporate and business support |  |                                     | 520   |      |  |  | 501   | 
|                               |  |                                     |       |      |  |  |       | 
|                               |  |                                     | 2,753 |      |  |  | 2,598 | 
|                               |  |                                     |       |      |  |  |       | 

SELECTED CONSOLIDATED FINANCIAL INFORMATION

The following table sets out financial information with respect to Husky for
the periods indicated. This information should be read in conjunction with the
Consolidated Financial Statements of Husky which are contained in its 2002
Annual Report.

|                                                        |                     |   |                                   |      |      |   |       |      |  |   |       |      | 
|------------------------------------------------------- | ------------------- | - | --------------------------------- | ---- | ---- | - | ----- | ---- |  | - | ----- | ---- | 
|                                                        |                     |   | Years ended December 31,         
|                                                        |                     |   |                                  
|                                                        |                     |   | 2002                              |      | 2001 |   | 2000 
|                                                        |                     |   |                                   |      |      |   |      
|                                                        |                     |   | ($millions except per share data)
|Statement of Earnings Data
Sales and operating
revenues |                     | $ | 6,384                             |      |      | $ | 6,596 |      |  | $ | 5,066 |     
|Cash flow from operations                               |                     |   | 2,096                             |      |      |   | 1,946 |      |  |   | 1,399 |     
|Net Earnings (loss)                                     |                     |   | 804                               |      |      |   | 654   |      |  |   | 438   |     
|                                                        | Per share  Basic   |   |                                   | 1.88 |      |   |       | 1.49 |  |   |       | 1.28 | 
|                                                        | Per share  Diluted |   |                                   | 1.88 |      |   |       | 1.48 |  |   |       | 1.28 | 
|Balance Sheet Data                                      |                     |   |                                   |      |      |   |       |      |  |   |       |     
|Total assets                                            |                     |   | 10,575                            |      |      |   | 9,370 |      |  |   | 8,829 |     
|Shareholders equity                                    |                     |   | 5,127                             |      |      |   | 4,486 |      |  |   | 3,985 |     
|Total long term debt                                    |                     |   | 1,964                             |      |      |   | 1,948 |      |  |   | 2,311 |     
|Dividend per share                                      |                     | $ | 0.09                              | (1)  |      | $ | 0.09  | (1)  |  |   | 0.09  | (2) 

Notes:



---

|(1) |  | Declared and paid in respect of each quarter in 2002 and 2001.                                            
|--- |  | ----------------------------------------------------------------------------------------------------------
|   
|(2) |  | Dividend in respect of the fourth quarter of 2000 declared on February 14,
2001 and paid on April 1, 2001.

There were no changes in accounting policies, major acquisitions or
divestitures, or major changes in the nature of Huskys business that affect
the comparability of this annual data, except for (i) the adoption of the
recommendations of the Canadian Institute of Chartered Accountants with respect
to accounting for foreign exchange effective January 1, 2002, (ii) the adoption
of the recommendations of the Canadian Institute of Chartered Accountants with
respect to accounting for income taxes effective January 1, 1999; (iii) the
acquisition of Renaissance; and (iv) the adoption of the recommendations of the
Canadian Institute of Chartered Accountants in respect of the calculation and
presentation of earnings per share. Description of these changes are contained

37



---



##### 



in Notes 3(f), 10, 6 and 11, respectively, to the Consolidated Financial
Statements of Husky which are contained in Huskys 2002 Annual Report and are
incorporated herein by reference.

MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Managements discussion and analysis of financial condition and results of
operations for the fiscal years ended December 31, 2002 and December 31, 2001
is contained on pages 32 through 58 of Huskys 2002 Annual Report and is
incorporated herein by reference.

MARKET FOR SECURITIES

Huskys common shares are listed and posted for trading on the Toronto Stock
Exchange under the trading symbol HSE.

DIRECTORS AND OFFICERS

The following are the names and municipalities of residence of the directors
and officers of Husky, their positions and offices with Husky and their
principal occupations during the past five years. The directors shall hold
office until the next annual meeting of Husky shareholders or until their
respective successors have been duly elected or appointed.

|                          |  |                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|------------------------- |  | ------------------------ |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name and                  |  |                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Municipality of           |  |                          |  | Principal Occupation During Past                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|Residence                 |  | Office or Position       |  | 5 Years                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                          |  |                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Li, Victor T.K.
Hong Kong |  | Co-Chairman and Director |  | Managing Director of Cheung
Kong (Holdings) Limited (an
investment holding company)
since 1999 and Deputy Chairman
since 1994. Mr. Li has also
been Deputy Chairman of
Hutchison Whampoa Limited (an
investment holding company)
since 1999 and Executive
Director since 1995, as well as
Chairman of Cheung Kong
Infrastructure Holdings Limited
(an infrastructure development
company) since 1996 and of CK
Life Sciences Intl.,
(Holdings) Inc. (a
biotechnology company) since
2002. Mr. Li is also an
Executive Director of Hongkong
Electric Holdings Limited (a
holding company) and a Director
of The Hong Kong and Shanghai
Banking Corporation Limited.
Mr. Li is a member of the
Chinese Peoples Political
Consultative Conference of the
Peoples Republic of China and
he is also a member of the
Commission on Strategic
Development and the Business
Advisory Group of the Hong Kong
Special Administrative Region.
Mr. Li holds a Bachelor of
Science degree in Civil
Engineering and a Master of
Science degree in Structural
Engineering.

38



---



##### 



|                                               |  |                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|---------------------------------------------- |  | ------------------------ |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name and                                       |  |                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Municipality of                                |  |                          |  | Principal Occupation During Past                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Residence                                      |  | Office or Position       |  | 5 Years                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                               |  |                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Fok, Canning K.N.
Hong Kong                    |  | Co-Chairman and Director |  | Group Managing Director of
Hutchison Whampoa Limited since
1993 and Executive Director
since 1984. Mr. Fok is the
Chairman of Hutchison
Telecommunications (Australia)
Limited (a telecommunications
company) since 1999, Hutchison
Harbour Ring Limited (an
investment holding company)
since 2002 and Partner
Communications Company Ltd. (a
telecommunications company)
since 1998 and the Deputy
Chairman of Cheung Kong
Infrastructure Holdings Limited
and Hongkong Electric Holdings
Limited. Mr. Fok is also a
director of Cheung Kong
(Holdings) Limited and
Hutchison Whampoa Finance (CI)
Limited (a finance company).
Mr. Fok holds a Bachelor of
Arts degree and is a member of
the Australian Institute of
Chartered Accountants.
|                                               |  |                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Glynn, Martin J.G.
Vancouver, British
Columbia |  | Director                 |  | President, Chief Executive
Officer and a director of HSBC
Bank Canada since late 1999 and
Chief Operating Officer from
1997 to 1999. From 1982 Mr.
Glynn held various senior
executive positions with HSBC
Bank Canada (formerly Hongkong
Bank of Canada). Mr. Glynn has
been a Director and Chief
Operating Officer of HSBC North
America Inc. since 2002, and a
Director of HSBC Bank USA and
Chairman and director of HSBC
Canadian Direct Insurance
Incorporated. Mr. Glynn is also a director of
Wells Fargo HSBC Trade Bank
N.A. in the United States. Mr.
Glynn is also a member of the
Board of Governors for the
University of British Columbia.                                                                                      
|                                               |  |                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Greene, Ronald G.(1)
Calgary, Alberta          |  | Director                 |  | President and Chief Executive
Officer of Tortuga Investment
Corp. (an investment holding
company), Chairman of Denbury
Resources Inc. and a Director
of WestJet Airlines Ltd. Mr.
Greene was the founder and
Chairman of Renaissance Energy
Ltd. until its merger with
Husky Oil Limited in 2000.                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                               |  |                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Hui, Terence C.Y.
Vancouver, British
Columbia  |  | Director                 |  | President & Chief Executive
Officer, Concord Pacific Group
Inc. (a real estate development
company) since 1997, President
of Adex Securities Inc. (a
financial services company)
since 1992 and Chairman of
Maximizer Software Inc.
(formerly Multiactive Software
Inc.) (a computer software
company) since 1995. Mr. Hui
was President and Chief
Executive Officer of Pacific
Place Developments Corp. (a
real estate development
company) from 1992 to 2001.                                                                                                                                                                                                                                                                                

39



---



##### 



|                                               |  |                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|---------------------------------------------- |  | ------------------------------------------------ |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name and Municipality                          |  |                                                  |  | Principal Occupation During Past                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|of Residence                                   |  | Office or Position                               |  | 5 Years                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                               |  |                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Kinney, Brent D.
Dubai, United Arab
Emirates   |  | Director                                         |  | Independent businessman. Mr. Kinney is a
director of Dragon Oil plc in the United Arab
Emirates.                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                               |  |                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Kluge, Holger
Toronto, Ontario                 |  | Director                                         |  | Corporate Director. Mr. Kluge was President,
Personal and Commercial Bank, Canadian
Imperial Bank of Commerce from 1990 to 1999
and a director from 1992 to 1999. Mr. Kluge
is a director of Hongkong Electric Holdings
Limited, Hutchison Telecommunications
(Australia) Limited, TOM.COM LIMITED and
Assante Corp. (a financial planning company).
Mr. Kluge holds a Bachelor of Commerce degree
and a Masters degree in Business
Administration.                                                             
|                                               |  |                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Koh, Poh Chan
Hong Kong                        |  | Director                                         |  | Finance Director, Harbour Plaza Hotel
Management (International) Ltd. Miss Koh was
Executive Vice President and Chief Financial
Officer of Husky Oil Ltd. from 1992 to 1997.                                                                                                                                                                                                                                                                                                                                     
|                                               |  |                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Kwok, Eva L.
Vancouver, British
Columbia       |  | Director                                         |  | Chairman, a director and Chief Executive
Officer, Amara International Investment Corp.
(an investment holding company) since 1992
and President from 1992 to 1996. Mrs. Kwok is
a director of Air Canada, Bank of Montreal
Group of Companies and Telesystem
International Wireless Inc. and since 2002 of
CK Life Sciences Intl., (Holdings) Inc. (a
biotechnology company).                                                                                                                                   
|                                               |  |                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Kwok, Stanley T.L.
Vancouver, British
Columbia |  | Director                                         |  | President, Stanley Kwok Consultants (an
architecture and development company) since
1993. Mr. Kwok has been a director since
1997, and was Chairman from 1996 to 1998 of
Amara International Investment Corp. Mr. Kwok
is a director of Cheung Kong (Holdings)
Limited and CTC Bank of Canada.                                                                                                                                                                                                                   
|                                               |  |                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Lau, John C.S.
Calgary, Alberta                |  | President & Chief
Executive Officer
and Director |  | President & Chief Executive Officer of Husky
Energy Inc. since August 2000. Prior thereto,
Mr. Lau was Chief Executive Officer of Husky
Oil Limited since 1993.                                                                                                                                                                                                                                                                                                                                                  
|                                               |  |                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Matthews, Wilmot L.(1)
Toronto, Ontario        |  | Director                                         |  | Mr. Matthews has been involved in all aspects
of investment banking by serving in various
positions with Nesbitt Burns Inc. and its
predecessor companies from 1964 until his
retirement in 1996, most recently as Vice
Chairman and Director. Mr. Matthews is
currently President of Marjad Inc. (a
personal investment company). Mr. Matthews is
Chairman and Chief Executive Officer of
Helptrain Inc. (a sales, marketing,
E-learning and E-business process company)
and a Director of WestJet Airlines Ltd.

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|                                |  |                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|------------------------------- |  | ---------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name and Municipality           |  |                                          |  | Principal Occupation During Past                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|of Residence                    |  | Office or Position                       |  | 5 Years                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                |  |                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Shaw, Wayne E.
Toronto, Ontario |  | Director                                 |  | Barrister and Solicitor, Stikeman Elliott LLP.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                |  |                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Shurniak, William
Australia     |  | Deputy Chairman and
Director             |  | Director and Chairman of ETSA Utilities (a
utility company) since 2000, Powercor
Australia Limited (a utility company) since
2000 and CitiPower Pty Ltd. (a utility
company) since 2001. Mr. Shurniak has also
been a director of Envestra Limited (a
natural gas distributor) since 2000 and
Downer Edi Ltd. (an engineering services
company) since 2001. Mr. Shurniak was an
Executive Director and Group Finance Director
of Hutchison Whampoa Limited from 1984 to
1997 and has remained a director of Hutchison
Whampoa Limited since then. Mr. Shurniak was
a director and Deputy Chairman of Asia
Satellite Telecommunications Holdings Limited
(a telecommunications company) from 1996 to
1999. Mr. Shurniak holds an Honorary Doctor
of Laws degree from the University of
Saskatchewan and from The University of
Western Ontario.
|                                |  |                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Sixt, Frank J.
Hong Kong        |  | Director                                 |  | Group Finance Director of Hutchison Whampoa
Limited since 1998 and Executive Director
since 1991. Mr. Sixt is the Chairman of
TOM.COM LIMITED since 1999. Mr. Sixt is also
an Executive Director of Cheung Kong
Infrastructure Holdings Limited and Hongkong
Electric Holdings Limited and a director of
Cheung Kong (Holdings) Limited, Hutchison
Whampoa Finance (CI) Limited, Hutchison
Telecommunications (Australia) Limited and
Partner Communications Company Ltd. Mr. Sixt
was also a director of Orange plc. from 1998
to 2000 and of Voice Stream Wireless Corp.
from 2000 to 2001. Mr. Sixt holds a Masters
degree in Arts and a Bachelors degree in
Civil Law and is a member of the Bar and of
the Law Society of the Provinces of Quebec
and Ontario, Canada.                                                                 
|                                |  |                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|McGee, Neil D.
Calgary, Alberta |  | Vice President &
Chief Financial
Officer |  | Vice President & Chief Financial Officer of
Husky since August 2000. Prior thereto Mr.
McGee was Vice President and Chief Financial
Officer of Husky Oil Limited since 1998.
Prior to joining Husky Oil Limited Mr. McGee
was with Hutchison Whampoa Limited first as
group legal advisor and Corporate Secretary
and then as Senior Manager of Corporate
Finance and Corporate Secretary.                                                                                                                                                                                                                                                                                                                                                                                                                                                    

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|                                    |  |                                                     |  |                                                                                                                                                                                                                                                     
|----------------------------------- |  | --------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name and                            |  |                                                     |  |                                                                                                                                                                                                                                                     
|Municipality of                     |  |                                                     |  | Principal Occupation During Past                                                                                                                                                                                                                    
|Residence                           |  | Office or Position                                  |  | 5 Years                                                                                                                                                                                                                                             
|                                    |  |                                                     |  |                                                                                                                                                                                                                                                     
|Ingram, Donald R.
Calgary, Alberta  |  | Senior Vice
President,
Midstream & Refined
Products |  | Senior Vice President,
Midstream and Refined Products
of Husky since August 2000.
Prior thereto Mr. Ingram was
Vice President, Downstream of
Husky Oil Limited from 1994
until 1999 when he became Vice
President of Midstream of Husky
Oil Limited.
|                                    |  |                                                     |  |                                                                                                                                                                                                                                                     
|Girgulis, James D.
Calgary, Alberta |  | Vice President,
Legal & Corporate
Secretary         |  | Vice President, Legal &
Corporate Secretary of Husky
since August 2000. Mr.
Girgulis joined Husky Oil
Limited in 1994 as part of the
legal group and became General
Counsel and Corporate Secretary
in 1999.                                        

Note:



---

|(1) |  | Will not be standing for re-election at the annual meeting on April 30,
2003.
|--- |  | -----------------------------------------------------------------------------

The board of directors has an Audit Committee (as required by the Business
Corporations Act(Alberta)) currently consisting of M.J.G. Glynn, T. C.Y. Hui,
W.L. Matthews and W.E. Shaw, and a Compensation Committee currently consisting
of C.K.N. Fok, R.G. Greene, H. Kluge, E.L. Kwok and F.J. Sixt, and a Health,
Safety and Environment Committee currently consisting of B.D. Kinney, H. Kluge
and S.T.L. Kwok and a Corporate Governance Committee currently consisting of H.
Kluge, E.L. Kwok and W.L. Matthews. Husky does not have an Executive
Committee. As Messrs. Greene and Matthews are not standing for re-election as
directors at the 2003 annual shareholders meeting their term on the committees
which they are currently members will end on the date of that meeting.

As at February 28, 2003, the directors and officers of Husky, as a group, owned
beneficially, directly or indirectly, or exercised control or direction over
1,609,865 common shares of Husky representing less than 1% of the issued and
outstanding common shares.

Conflicts of Interest

Certain officers and directors of Husky are also officers and/or directors of
other companies engaged in the oil and gas business generally and which, in
certain cases, own interests in oil and gas properties in which Husky holds or
may in future hold an interest. As a result, situations arise where the
interests of such directors and officers conflict with their interests as
directors and officers of other companies. In the case of the directors the
resolution of such conflicts is governed by applicable corporate laws which
require that directors act honestly, in good faith and with a view to the best
interests of Husky and, in respect of the Business Corporations Act(Alberta),
Huskys governing statute, that directors declare, and refrain from voting on,
any matter in which a director may have a conflict of interest.

Corporate Cease Trade Order or Bankruptcies

None of those persons who are directors, officers or promoters of the
Corporation is, or has been within the past ten years, a director, officer or
promoter of any other corporation that, while such person was acting in that
capacity, was the subject of a cease trade or similar order or an order that
denied the access to any statutory exemptions for a period of more than 30
consecutive days, or was declared bankrupt or made a voluntary assignment in
bankruptcy, made a proposal under

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any legislation relating to bankruptcy or insolvency or been subject to or
instituted any proceedings, arrangement or compromise with creditors or had a
receiver, receiver manager or trustee appointed to hold the assets of that
person.

Penalties or Sanctions

None of the persons who are directors, officers or promoters of the Corporation
have, within the ten years prior to the date of this Annual Information Form,
been subject to any penalties or sanctions imposed by a court or securities
regulatory authority relating to trading in securities, promotion or management
of a publicly traded corporation, or theft or fraud.

DIVIDEND POLICY

The board of directors of Husky have established a dividend policy that pays
quarterly dividends. Since August 2000, the Corporation has paid a quarterly
dividend of $0.09 ($0.36 annually) per common share. However, there can be no
assurance that further dividends will be declared. The declaration and payment
of dividends will be at the discretion of the board of directors of Husky which
will consider earnings, capital requirements, financial condition of Husky and
other relevant factors.

ADDITIONAL INFORMATION

Additional information, including directors and officers remuneration and
options to purchase common shares, and interests of insiders in material
transactions is contained in Huskys Management Information Circular dated
March 26, 2003 (the Information Circular), prepared in connection with the
Annual Meeting of shareholders to be held on April 30, 2003.

Additional financial information is provided in Huskys Consolidated Financial
Statements and Managements Discussion and Analysis for the most recently
completed fiscal year ended December 31, 2002, contained in Huskys 2002 Annual
Report.

Copies of the Information Circular, the financial statements, including any
interim financial statements, additional copies of this Annual Information
Form, including one copy of any document, or the pertinent pages of any
document, incorporated by reference in the Annual Information Form, and if
Husky is in the course of a distribution pursuant to a short-form prospectus or
a preliminary short-form prospectus, any other documents incorporated therein
by reference may be obtained upon request from the Vice President, Legal &
Corporate Secretary of Husky, 40th Floor, 707 8th Avenue S.W., Calgary, Alberta
T2P 1H5, Telephone: (403) 298-7333; Facsimile: (403) 298-7323.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

The Company is hereby providing cautionary statements identifying important
factors that could cause the Companys actual results to differ materially from
those projected in forward-looking statements made in this Annual Information
Form. Any statements that express, or involve discussions as to, expectations,
beliefs, plans, objectives, assumptions or future events or performance (often,
but not always, through the use of words or phrases such as will likely
result, are expected to, will continue, is anticipated, estimated,
intends, plans, projection and outlook) are not historical facts and
may be forward-looking and may involve estimates, assumptions and uncertainties
which could cause actual results or outcomes to differ materially from those
expressed in the forward looking statements. Accordingly, any such statements
are qualified in their entirety by reference to, and are accompanied by, the
factors

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discussed throughout this Annual Information Form. Among the key factors that
have a direct bearing on the Companys results of operation are the nature of
the Companys involvement in the business of exploration, development and
production of oil and natural gas reserves and the fluctuation of the exchange
rate between the Canadian dollar and the United States dollar. These and other
factors are discussed herein under Managements Discussion and Analysis of
Financial Condition and Results of Operations, incorporated by reference from
the Companys 2002 Annual Report and elsewhere in this Annual Information Form.

Because actual results or outcomes could differ materially from those expressed
in any forward-looking statements of the Company made by or on behalf of the
Company, investors should not place undue reliance on any such forward-looking
statements. Further, any forward-looking statement speaks only as of the date
on which such statement is made, and the Company undertakes no obligation to
update any forward-looking statement or statements to reflect events or
circumstances after the date on which such statement is made or to reflect the
occurrence of unanticipated events, except as required by applicable securities
laws. New factors emerge from time to time, and it is not possible for
management to predict all of such factors and to assess in advance the impact
of each such factor on the Companys business or the extent to which any
factor, or combination of factors, may cause actual results to differ
materially from those contained in any forward-looking statements.

44