The Public Utilities Board, through its Petroleum Pricing Office, has set the new maximum fuel prices in Newfoundland and Labrador (NL), as per its scheduled bi-weekly adjustment.

Effective 12:01 a.m. Thursday, September 13, 2007, all maximum fuel prices will increase as follows:

Seasonal pressures on heating oil are starting to emerge as commodity markets shift focus from the production of gasoline to distillate fuels (furnace/stove oil and diesel) in preparation for the coming heating season. In addition, U.S. gasoline inventories are well below average and, despite an OPEC (Organization of Petroleum Exporting Countries) commitment to increase production quotas beginning in November, the market continues to reflect upward pressure on pricing indicating these quotas may still be insufficient. Also, other factors impacting fuel prices which have not subsided include the threat posed by further hurricanes and economic uncertainties, particularly in the U.S.

As previously announced by the board effective September 1, 2006 (see news releases), changes to federal regulations required the use of ultra low sulphur diesel (ULSD) in the retail market. These changes meant that prices were adjusted to reflect the additional costs associated with the improved emission specifications for this product. While this federal regulation has already been in place on the island portion of the province since that time, ULSD standards were not required for Labrador until September 1, 2007 to allow sufficient time for stored product to flow through the entire fuel network. Therefore, maximum diesel prices in Labrador will now reflect those of the ultra low sulphur product.

In keeping with these mandated federal standards, the Petroleum Products Act was amended to include the Platts New York Cargo price for ULSD as the benchmark for setting the regulated maximums for diesel.

For further information, visit the board�s Web site: www.pub.nl.ca.

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There was a delay in the implementation for northern regions (including the entirety of Labrador) because of the difficulty in supplying these areas, especially in winter. Refuelling facilities in these areas generally experience slower turnover of diesel fuel inventories and Natural Resources Canada established a later effective date for implementation of this particular standard.

More information regarding ULSD regulations can be found on the following Web site: //www.ec.gc.ca/ceparegistry/documents/regulations/qa_guid/questions.cfm, with an amendment at: //canadagazette.gc.ca/partII/2006/20060712/html/sor163-e.html

2007 09 13                                                 10:50 a.m.