Exploration Contract Ratified by Kurdistan Regional Government



    /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR DISSEMINATION IN THE
    UNITED STATES/

    CALGARY, March 2 /CNW/ - WesternZagros Limited ("WesternZagros"), a
wholly-owned subsidiary of Western Oil Sands Inc. ("Western"), received
confirmation today that its Exploration and Production Sharing Agreement
("EPSA") has been ratified by the Kurdistan Regional Government ("KRG") and
confirmed by His Excellency Nerchivan Barzani, Prime Minister of Iraqi
Kurdistan. As part of the ratification process, WesternZagros has worked with
the KRG to finalize its EPSA area boundary and other key terms in line with
draft petroleum legislation. The final EPSA area encompasses 2,120 square
kilometers (approximately 524,000 acres) and holds a number of high potential
prospects.
    Dr. Ashti Hawrami, the KRG's Minister for Natural Resources commented,
"We're delighted WesternZagros is moving forward with its exploration program.
WesternZagros is one of the most professional companies in the Kurdistan
region of Iraq and we welcome the investment and expertise they bring to the
region. The KRG is committed to providing a strong investment environment for
companies such as WesternZagros."
    Kurdistan offers tremendous long-term growth potential and WesternZagros
is committed to working alongside the government and the people of the
Kurdistan region to ensure its goals are consistent with the aspirations of
the new democratic regime over the long-term. WesternZagros is encouraged by
recent developments with respect to the draft Federal Oil Law which has been
approved by the Iraqi cabinet for consideration by the Iraq Council of
Representatives.

    About Western Oil Sands

    Western Oil Sands Inc. is a Canadian corporation listed on the Toronto
Stock Exchange under the symbol WTO. Our vision is to create shareholder value
through the opportunity capture and development of large, world-class
hydrocarbon resources. Our primary asset is our 20 per cent undivided interest
in the Athabasca Oil Sands Project. Western is also pursuing initiatives
related to in-situ and technology development as well as downstream
opportunities. WesternZagros Limited, a wholly-owned subsidiary of Western, is
pursuing conventional oil and gas exploration opportunities in the Federal
Region of Kurdistan in Northern Iraq. For additional information, visit
www.westernoilsands.com.

    Source: Western Oil Sands
    -------------------------

    This press release may contain forward-looking information, including
information relating to Western's future development and expansion plans.
Forward-looking information typically contains statements with words such as
"anticipate", "estimate", "expect", "potential", "could", or similar words
suggesting future outcomes. We caution readers and prospective investors of
the Company's securities not to place undue reliance on forward-looking
information as by its nature, it is based on current expectations regarding
future events that involve a number of assumptions, inherent risks and
uncertainties, which could cause actual results to differ materially from
those anticipated by Western. Risks associated with our international
initiatives include, but are not limited to,, political and economic
conditions in the countries in which we intend to operate, risks associated
with acts of insurgency or terrorism, changes in market conditions, risks
associated with obtaining financing on acceptable terms, political risks,
including changes in law, regulation or government policy, the risks
associated with negotiating with foreign governments and risks generally
associated with international activity. No assurances can be given that
WesternZagros will be able to maintain or obtain effective security or
insurance of any of its assets or personnel in Iraq where, at times, terrorism
and insurgent activities have disrupted various business activities during the
past and may affect Western's operations or plans in the future. There can be
no assurance that future instability in this region, actions by companies
doing business there, or actions taken by the international community will not
have a material adverse effect on this region and in turn on WesternZagros'
financial condition or operations.





For further information:

For further information: David A. Dyck, Senior Vice President Finance
and Chief Financial Officer, (403) 233-1700; Dorreen Miller, Manager, Investor
Relations & Communications, (403) 233-1757

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MARATHON OIL CANADA CORPORATION

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