The failure of a second power generator has forced Petro-Canada (TSX:PCA) to halt production at its Terra Nova offshore oilfield until the fall, the oil company said Tuesday.

The shutdown on Sunday followed the mechanical failure of the gearbox attached to the starboard main power generator on the rig, Petro-Canada said. A second generator had been shut down for maintenance in February.

Terra Nova will be closed for an additional four to five weeks on top of an already scheduled shutdown for maintenance, set to commence in mid-June. Petro-Canada is aiming to resume production at the end of September.

"What this effectively does is advance the shutdown," company spokesman John Downton said in an interview from St. John's, N.L.

"We are looking to optimize the time that we are shut down now to make the scheduled shutdown as efficient as possible."

The company said it now forecasts second-quarter production of about 21,000 barrels per day, down from an earlier estimate of 83,000 barrels.

That would drop its oil revenue from the field during the period from about $697 million US to about $176 million US, assuming 120 days of continuous operations and oil prices around $70 a barrel.

"There is obviously an impact on the production for the quarter," Downton said.

"We plan to bring it up and expect to be able to operate with more consistency than we've had in recent weeks."

Terra Nova, in the Atlantic Ocean about 350 kilometres southeast of St. John's, has been the source of production shutdowns and other problems for Petro-Canada in the past. Just last week, the company was fined a record $290,000 Cdn for spilling 1,000 barrels of oil at its site on Nov. 20, 2004.

"It's a harsh operating environment, there's no question about that, but I wouldn't be able to relate that to a difference with one of the other facilities or anything of that nature," Downton said, referring to the nearby Hibernia and White Rose projects.

The company is assessing the timing and scope of repairs needed for the gear box attached to the starboard main power generator.

Repairs to the port side main power generator are expected to be completed in June.

The Terra Nova site is operating on two standby generators that don't support production.

On the Toronto stock market at midday Tuesday, Petro-Canada shares were down 31 cents at $52.83.