1. Oil Sands – An International Asset CCEMC – an Alberta-based, independent, not-for-profit organization focused on discovery, development and deployment of clean technology Climate Change and Emissions Management (CCEMC) Corporation

2. Oil Sands: Technology Oil To Bitumen (high viscosity, 4.5% Sulfur, contains Vanadium, Nickel, Nitrogen, Oxygen) To Synthetic Crude Oil (low viscosity, low Sulfur, low V, Ni, N, O) From Oil Sands From Oil Sands Oil Sands – combination of  Bitumen (3 - 18%)  Water (2 - 10%)  Sand (50 - 75%)  Clay (10 - 30%)

3. Global energy demand will increase by 36% between 2008 and 2035 80% of this demand will be fossil fuel based Best case for US still requires 9Mbbl/day in 2025 Alberta has second largest proven reserves next to Saudi Arabia Most of the oil the US imports from Canada comes from oil sands Global Energy Demand World Energy Outlook

4. −The share of crude oil imports coming into the United States from Canada has increased from 13 per cent to 22 per cent over the past decade −By 2030 Alberta’s oil sands alone should supply fully one third of US needs Alberta’s Abundant Energy Canada (Alberta) is a source of strategic supply -Second largest proven reserves next to Saudi Arabia -Production increasing to +3Mbbl/day -30% of Alberta’s GDP US consumption – 20M BBL/day - more oil than any other nation in the world Alberta is the largest global supplier to the US

5. Canada-U.S.: World’s largest trading relationship 900 U.S. companies supply oil sands, 69 in Illinois alone Every U.S. $ spent on Canadian products returns 91 cents to the U.S. economy Over next five years oil sands will -Contribute $34 billion to US GDP by 2015 -Create 343,000 new jobs (person years) in the U.S. In Illinois, over the next five years oil sands will: -Contribute $3 billion increase in industry output -Add more than $1.5 billion to GDP -Create more than 14,000 new jobs (person years) North American Impact Oil Sands – A Powerful Economic Engine

6. Liquid Pipelines

7. Proposed and under construction

8. -Three major environmental challenges -Reduce carbon emissions from energy production -Reduce water use and improve water quality -Reduce tailings ponds and enhance reclamation -Alberta is taking decisive action in all areas. The Environmental Challenge Responsible development will drive the realization of this economic potential

9. A climate for change MT GHG Emissions 246 63 0.4 1.6 72 21 86 10 19 21 2 197 2007 GHG Emissions 2020 GHG Emissions 305 70 77 232 110 25 27 28 2 12 7

10. We share a common challenge

11. Alberta’s reduction commitments

12. Government Programs and Initiatives Program / InitiativeDescription Commercial- Scale Carbon Capture and Storage $2 billion fund 4 projects approved – 5 MT/y of CO2 stored by 2015 Climate Change & Emissions Management Corporation ~ $70 M/y compliance fund targeted to energy efficiency, ‘greening’ fossil fuels, renewables and carbon sinks. Alberta ecoTrust One time $157 M targeted to GHG reductions and emissions of concern. Several projects approved. Innovative Energy Technology Program $200 M based on royalty credit targeted to oil and gas pilot projects; over 30 pilots approved Bitumen Royalty In-Kind Bitumen made available for high valued upgrading/refining; NWU project term-sheet approved EES Industry Programs ~20 M/y technology development in 3 strategic areas – Energy Technologies, Environmental Technologies, Renewable and Emerging Resources

13. Carbon Capture and Storage Alberta is investing more in CCS, on a per capita basis than any other jurisdiction in the world Province plans to produce a 70 per cent reduction in emissions through CCS Carbon Capture and Storage Council – Makes recommendations to facilitate the immediate implementation and long-term success of CCS in Alberta recommended $2B allocated EES has 29 CCS projects underway

14. CCS expected to achieve 139MT (70% of 2050 reduction targets) $2B have been invested in four projects Quest (Shell, Chevron, Marathon)- Upgrader C02 captured, transported and injected Pioneer (Transalta) – 450MW coal fired plant Alberta Carbon Trunkline (Enhance) – C02 pipeline Swan Hills SynFuels – Insitu Coal gasification 5MT target by 2015 Alberta – CCS Investments

15. Carbon Capture And Storage Statutes Amendment Act (Dec 2010) Designed to enable CCS General provisions Alberta owns the pore space – crown will approve sites Enables tenure agreements – the Minister can grant the right to inject C02 The Crown accepts liability after a closure certificate A Post-closure Stewardship Fund is established CCS Legislation in Alberta

16. Closing the cost gap may well be the single largest task unless / until the international price of carbon increases Hypothetical Economic Profile

17. Climate Change Strategy (02/08) Climate Change and Emissions Management Act (03) Climate Change and Emissions Management Fund Specified Gas Emitters Regulation (07) Climate Change Emissions Management Regulation (09) Alberta’s Technology Fund CCEMC - a tool to advance clean technologies Government of Alberta Policy Evolution CCEMC Mandate - to establish or participate in funding for initiatives and other measures related to actual and sustainable reductions in greenhouse gas emissions and improve the ability to adapt to climate change

18. −improve the efficiency of their operations, −buy carbon credits in the Alberta-based offset system, −pay $15 dollars into the Climate Change and Emissions Management Fund for every tonne they emit over the reduction limit. Climate Change and Emissions Management (CCEMC) Corporation Unique model Independent not-for-profit organization Dedicated, sustainable funding Funding is collected from industry that annually produce more than 100,000 tonnes of GHG emissions Legally required to reduce their greenhouse gas intensity by 12 per cent. Companies have three options to meet their reduction target:

19. Announced nearly $100 million in funding for clean technology initiatives in less than 12 months. 2 RFPs approved Next RFP approval – May Latest RFP announced in April Support innovations that can be applied worldwide with the potential of game-changing outcomes Leverage 4:1 – more than $ 465M total project investment Total resources available to date - $260M Expect >$1B worth of projects by end of next year Funds are renewed annually – approx. $60-80M A Continuous Cycle of Innovation

20. Energy and Environment Solutions One of four new corporations launched in January 2010 Technology arm of GOA in energy and environment Position Alberta as an international leader in energy and environmental technologies – low carbon & efficient water economy Visionary leadership to shape the future Balanced portfolio focused on the key technical, environmental and economic challenges Initiatives focused on converting Alberta’s natural and renewable resources to clean fuels and chemicals while reducing: Capital costs Energy demand Fresh water consumption CO 2 and environmental emissions

21. Bitumen Upgrading Clean Carbon/Coal Improved Recovery CO 2 & Emissions Water Use Enhanced Ecology Sustainability Index Renewables Alternative fuels Water EES Strategic Focus

22. EES Long Term Targets TECHNOLOGIES AND MANAGEMENT TARGETS De-CarbonizationClean EnergyClean Water 50% reduction on GHG emissions on a per equivalent barrel basis 20% of energy is derived from renewable resources 30% increase in water efficiency 20% reduction in energy consumed in the production of bitumen Coal-fired power plants in Alberta at natural gas equivalent 74 million m3 reduction from Directive 074 target COMMERCIAL AND NEXT-GENERATION 3.0 million barrels per day of heavy oil and bitumen production 20% increase in conventional oil recovery 15% of gas will come from non-conventional sources

23. Environmental footprint (land, water, air, CCS, non- aqueous extraction, remediation/reclamation, etc. Extraction / mineral processing Upgrading processes Control of operations / processes Safety and risk management Construction engineering and management Welding and joining 700 researchers at the U of A R&D and Human Capital In response to needs expressed by industry, over the past 15 years the University of Alberta has hired > 50 faculty members & established centers with programs focused on:

24. > Building Human Capital - 1995

25. Building Human Capital - 2010

26. Significant investment in institutional capacity throughout the province National Nanotechnology Institute Devon Research Facility Ingenuity Centers Oil sands mining In-situ Helmholtz Institute Carbon Management Canada Canadian School for Energy and Environment A host of others A solid commitment by industry, government and academic/research institutions to address existing and emerging challenges Institutional Capacity

27. Addressing Myths with Facts MythFact Mining the oil sands is killing the Athabasca River In winter, Athabasca River water use capped at 5% of low flow, it is one of the most protected rivers in Alberta Oil sands are the major source of GHGs, especially CO2 for Canada GHG production per barrel has decreased over 50% since 1980s, total GHG production has tripled, but with a six-fold production increase since the 1980s Oil sands will cut down Alberta’s boreal forest (381,000 sq. km.) In situ oil sands recovery will disturb more land (perhaps 15,000 sq.km.) than mineable recovery but it will be spread over a larger area. All oil sands areas disturbed by mining or in situ recovery must be reclaimed.

28. Addressing Myths with Facts MythFact No or little oil sands area has been reclaimed 67 sq km of 602 sq. km of disturbed oil sands area has been reclaimed or is undergoing active reclamation--reclamation certificate is only issued for 0.1 sq. km Energy and oil sands are using up Alberta’s water supply Oil sands have 7% of Alberta’s allocations of surface and groundwater Oilsands will strip mine an area the size of Florida (149,000 sq. km) Mineable oil sands will disturb an area of 4,800 sq. km (not all at one time) Oil sands produce 3X GHG emissions as conventional oil Oil sands result in 5-15% higher GHG emissions relative to average of typical crudes

30. We are building a secure North American energy supply that is managed to minimize the negative environmental impacts. Canada’s oil sands are an essential resource to address North America’s energy needs as we begin a long transition to cleaner energy. We’re advancing the development of clean technology and reducing the environmental impacts of operations. As we address the world’s growing demands for energy and clean technology, we will produce jobs, economic opportunities and environmental benefits for all of North America. Climate Change and Emissions Management (CCEMC) Corporation Conclusion