Mr. Dan Cuthbertson reports

HUSKY ENERGY ANNOUNCES EXERCISE OF UNDERWRITERS' OPTION IN PREFERRED SHARE OFFERING

The underwriters of Husky Energy Inc.'s offering of cumulative redeemable preferred shares, Series 5, have exercised their option to increase the size to eight million shares, due to positive investor response.

The total gross proceeds from the upsized offering will be $200-million. Closing of the offering is expected on or about March 12, subject to customary closing conditions and receipt of required regulatory approvals.

Holders of the Series 5 shares will be entitled to receive a cumulative quarterly fixed dividend yielding 4.5 per cent annually for the initial period ending March 31, 2020. Thereafter, the dividend rate will be reset every five years at a rate equal to the five-year government of Canada bond yield plus 3.57 per cent.

Holders of Series 5 shares will have the right, at their option, to convert their shares into cumulative redeemable rate preferred shares, Series 6, subject to certain conditions, on March 31, 2020, and on March 31 every five years thereafter. Holders of the Series 6 shares will be entitled to receive cumulative quarterly floating dividends at a rate equal to the 90-day government of Canada treasury bill rate plus 3.57 per cent.

The prospectus supplement will be filed with securities regulatory authorities in all provinces of Canada.

The net proceeds of the offering will be used for the partial repayment of short-term debt incurred in connection with the company's U.S. refining operations.

We seek Safe Harbor.