Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 41 Table 3.2 Integrated Mining, Extraction and Upgrading Final Stage Assumptions Mining, Extraction, and Upgrading ‘Transportation to Hardisty from the field oi Light crude transportation differential to Chicago Usg/b $0.81 (Edmonton vs. Cushing) Upgrader Yiel % of initial volume 87% inputted Bitumen Gravity Kgjm3 849.8 ‘Transportation cost from the upgrader to pies cgi $0.60 Par discount to WTI @ Chicago usg/b $0.00 SCO Discount (Par - SCO @ Edmonton) uss/p $0.00 ‘The supply cost results are presented on the next page, followed by 2 sensitivity analysis. For ease of comparison the information plant gate supply cost components are displayed in both a tabular and graphic (stacked column) format. Table 3.3 Synthetic Crude Oil Supply Cost at Plant Gate 100,000 barrel per day Integrated Athabasca Mining, Extraction, and Upgrading Project ‘Supply Cost (Real Canadian dollars per barrel of SCO, 2006) Discounted Undiscounted Return on Investment Included 7.58 Fixed Capital 28.96 8.12 Operating Working Capital 0.55 0.30 Fuel 5.43 4.98 Other Operating Costs 20.66 20.08 Abandonment Costs 0.03 0.18 Royalties 255 3.75 Income Taxes 5.59 7.83 Kyoto Compliance Costs . 0.63 0.59 Total Supply Cost 64.35 64.39 October 2007Canadian Energy Research Institute Study No. 117 ISBN 1-896091-77-6 Oil Sands Update: Produ: October 2007 In Outlook and Supply Costs 2007-2027 Errata - page 42 The "y" axis of Figure 3.1 is mislabeled. It should read: SCO supply Cost (C$/b @ Plant Gate) The text below Figure 3.1 has a typographical error. It should read: This synthetic crude oil supply cost corresponds to a WTI equivalent supply cost of USS54.73 per barrel or C$65.51 at Cushing, Oklahoma. The corrected figure and text are reproduced below. Synthetic Crude Oil Supply Cost at Plant Gate 100,000 barrel per day Integrated Athabasca Mining, Extra Upgrading Project ie e* : - Byte Connionea Cone z 2 omer Operating Cote B» * operating Working Capa 8 Fed Catal | | pon lvenont Discounted Undzcounted This synthetic crude oil supply cost corresponds to a WTI equivalent supply cost of US$54.73 per barrel or C$65.51 at Cushing, Oklahoma,Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 43 3.2.1 Integrated Mining, Extraction and Upgrading Supply Cost Sensitivities Synthetic crude oil supply cost sensitivities for the hypothetical mining, extraction, and upgrading project are represented graphically in Figure 3.2. Figure 3.2 WTI Equivalent Supply Cost Sensitivities at Cushing, Oklahoma 100,000 barrel per day Integrated Project Carbon Donde Levy END 15 Wt Equivalent Price (USSD @ Cushing) 3.3 Stand-alone Upgraders Some of the upgraders in the industry are not directly associated with an oil sands project. We shall refer to these as Stand-alone Upgraders, since they “Stand Alone” from oil sands operations. 3. 1 Stand-alone Upgrading Supply Costs The supply cost for upgrading a barrel of bitumen to SCO is calculated in this section. Supply costs have been calculated for the upgraded product at the source field location. The cost assumptions are shown in the table below. They are identical to those used in the previous section for the upgrading portion of an integrated operation. Royalties are not charged on the SCO output October 200744 Stream Day Capacity Capital Expenditures Initial Capital Sustaining Capital Operating Working Capital Canadian Energy Research Institute Table 3.4 _ Stand-alone Upgrading Design and Cost Assumptions Upgrading Non-Royalty Applicable 100,000 b/d SCO Operating Costs (Excluding Energy) Fixed Operating Costs Variable Operating Costs Energy Purchased (Stream Day) Natural Gas Purchased NYMEX Price NYMEX-AECO Basis Field Premium Natural Gas Price Electricity Purchased Electricity Price Energy Sold (Stream Day) Electricity Sold Electricity Price Abandonment and Reclamation 2006 C§ milion 4,357 §millon/year 327 Days payment 45 2006 37.31 C$million/year Real 2006 C$/b 3.09 cya 0,475 Uuss/MmBtu $6.56 uss/Mmtu $1.00 CHG $0.27 Real 2006 C/G) $6.65 mwhyd 800 Real 2006 $62.70 ceymwh Mwh/d 0 Real 2006 $62.70 cet 9% of Total Capital 2.0% Under these assumptions, the calculated supply cost for a stand-alone upgrading project have been broken down by the components of the supply cost as provided in Table 3.5. Excluding the cost of bitumen, it costs C$27.06 to upgrade one barrel of SCO, including the cost of capital October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 45 Table 3.5 Components of Synthetic Crude Oil Supply Cost at Plant Gate Supply Cost (Real Canadian dollars per barrel, 2006) Return on Investmen Fixed Capital Operating Working Capital Fuel Other Operating Costs ‘Abandonment Costs Royalties Income Taxes Kyoto Compliance Costs Total Supply Cost Discounted Included 15.40 0.25 3.48 4.64 0.02 0.00 2.86 _0.42 27.06 : __100,000 barrel per day Upgrading Project Undiscounted 9.44 4.90 0.05 3.39 4.62 0.10 0.00 414 0.60 27.06 ‘October 200746 Canadian Energy Research Institute (THIS PAGE INTENTIONALLY LEFT BLANK) October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) a7 CHAPTER 4 ISSUES AND CHALLENGES TO THE OIL SANDS DEVELOPMENTS, As ol sands development continues to accelerate, a number of related issues are generating concern. The issues include potential shortages of labour and materials, environmental and climate change concerns, as well as concerns about infrastructure and natural gas use. While these issues are important, they may be susceptible to resolution by market forces over time. ‘This chapter provides an update on the major challenges cil sands operators must confront. We have intentionally excluded any discussion of an “appropriate” royalty structure for oil sands projects, and eagerly await announcements from the provincial government on the future of the oil sands royalty structure. This announcement was expected at the end of August, but has been delayed until sometime in September. 4.1 Environmental and Climate Change Issues Oilsands development has environmental implications, as do all large projects. ‘These implications are addressed in various ways and may or may not lead to delays. There are two general categories of environmental concern, global and local. Global concerns relate to the green house gases (GHG) emissions associated with oil sands projects whereas local concerns encompass all other land, water and air environmental implications (e.g., effects on water, fotests, local air quality). The focus ofthis report is on the emissions from oil sands projects. 4.1.1 Environment. Since our 2006 update, there has been little movement on the environmental front, save for the Alberta government implementing their carbon mitigation program. A program which includes Penalizing large emitters of carbon dioxide, as defined as those who emit aver 100,000 tonnes of carbon dioxide per year. The province has enacted Bill 37, the Climate Change and Emissions Management Act, and amendments to this Act through Bill 3, the Climate Change and Emissions Management Act, 2007. The Amended Bill seeks a reduction by “December 31, 2020 of specified gas emissions relative to Gross Domestic Product to an amount that is equal to or less than 50 percent of 1990 levels".”” This initiative, which adopts an “intensity” approach to emissions, is not popular with proponents of the Kyoto protocol, but will have the effect of reducing emissions from the no-action Projection. ‘The federal governments climate initiative, as stated in the proposed "Clean Air Act", Bill C-30,” is expected to “die” when Prime Minister Harper prorogues Parliament in Fall 2007. This act, ® Alberta Queen's Printer. Cimate Change and Emissions Management Act . Chapter C-16.7. 2003, - "Canada’s Clean Air Act , November 2, 2006 October 200748 Canadian Energy Research Institute which is proposed legislation and has not been put to vote, seeks to reduce Greenhouse Gas emissions to 65 percent of 2003 levels by 2050. Both the provincial legislation and federal proposal will likely have an impact on the attractiveness of altemative fuels to natural gas. Clean energy alternatives, such as nuclear, and gasification with emissions sequestration will likely get increased consideration. CERI is in the process of performing a detailed economic analysis for several of these low GHG fuel alternatives, with a tentative April 2008 release date of the results, ‘The competing Federal and Provincial legislation could bring about conflict between the two levels of government, if the federal legislation is more stringent than the provincial legislation. While likely a matter that could be settled before the courts, it may become a flashpoint for provincial angst against the federal government and result in an increased in the perceived risk of investing in the oil sands ~ however such a risk is negligible and not included in our discount rate, 4.2. Labour Shortage Since our 2006 study, the labour situation in Alberta has not abated ~ with increased mega project announcements the labour shortages in the province will continue into the foreseeable future until regulatory or market forces reduce the labour requirements. This however does not imply a reduction in oil sands activity Foreign labour is an option available for oil sands operators, and several projects are currently taking advantage of a federal immigration program designed to help alleviate the labour strain on the region.”* The Temporary Foreign Workers Program was implemented jointly by the provincial and federal government to help address the broad labour deficit. The program is not designed to bring in cheap labour to Alberta. Foreign workers must be paid at 2 rate competitive to the wages currently paid in the region.”* In addition to having to pay a competitive rate, companies bringing in foreign labour usually have large upfront recruitment and transportation costs, estimated by some at approximately CDN$10,000 a person.”* The competitive environment for labour services is certainly a challenge for proponents of current projects. 4.3 Infrastructure and Material Shortages Limitations to infrastructure, both in the region in and around Fort McMurray and connecting it to markets, is increasingly cited as posing some risk to smooth development of oil sands projects. The infrastructure within the region includes everything from housing for the labour force to hospital space and other community services—all of which have been subjected to some ® Renato Gandia, Unions, companies need to meet halfway on foreign workers, says analyst. Fort MeMurray Today, Apri 28, 2006. http://www. fortmemurraytoday.com/story.php?id=227560, July 2006 ® Human Resources Skills and Development, Government of Canada, Memorandum of Understanding for the Entry of Temporary Foreign Workers for Projects in the Alberta Qi Sands, hntip://wawhrsdc-gc.ca/enjepb/imafw/mouforOiAlberta.odt ** Based upon media reports and conversation with industry representatives. October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 49 considerable stress. Local infrastructure issues have resulted in calls for provincial support and/or for imposed delays in development, to allow the constraints to be addressed~though how such delays would work in a fair manner is not entirely clear. The Wood Buffalo Business Projection 2005 provides a complete overview of the urgent public infrastructure needs of the region as determined by industry, the municipality and public service sector. The report states that a CDNS1.2 billion needs to be invested into capital projects, such as health and school facilities, highway projects and other municipal projects to facilitate smooth transition.”” ‘The “connecting” infrastructure refers to the pipelines that carry inputs into the region and those carrying end-product out to market. While local infrastructure issues require a community response and may warrant provincial assistance in funding and resolution, the pipeline issues are matters for the industry to resolve. The constraints related to the capacity of the pipeline system serving the region are more likely to be resolved by the market. Capacity is needed to both transport blended or upgraded bitumen to refineries and also to supply diluent/condensate and natural gas necessary to operate the projects. In order to ship raw bitumen to market through feeder pipelines, the bitumen, typically, must either be blended with SCO, or a diluent (such as pentanes plus), to reduce the viscosity of the oll so it can flow through pipelines. Alternatively, bitumen upgraded to SCO can be shipped to market without a need for significant blending. The availability of a reliable and economically competitive supply of diluent is crucial. Enbridge’s Southern Lights pipeline project is intended to supply diluent to the region.”* Southern Lights completed their open season for shippers to transport diluent from the Chicago area to the Athabasca region on June 30, 2006. The original goal for the pipeline was to supply 180,000 BPD of diluent to the region, 162,000 of which is for committed shippers. Enbridge estimates the oil sands region requires at least 300,000 barrels a day of diluent supply. Diluent on its own is insufficient to resolve the problem of how to move the bitumen to market; feeder pipelines are required to bring the blended bitumen or SCO to market (refineries) where it can be refined. Alberta has a capacity to move approximately 2.4 million barrels a day of crude oil out of Alberta ~ using the Enbridge System, and Terasen (Express and Transmountain). Clearly this capacity is insufficient to transport all the production forecasted. The expected growth in bitumen production has resulted in many proposed pipeline projects and expansions, Based upon information from the NEB, pipeline capacity leaving the oil sands region is expected to increase to around 5.8 million barrels a day by 2015.” Based upon CERI’s production estimates, this capacity would be sufficient to allow bitumen, as a blend or SCO, to leave the 7 Athabasca Regional Issues Working Group in conjunction with: Regional Municipality of Wood Buffalo, Fort McMurray Public Schools, Fort McMurray Catholic Board of Education, Northland School Division, Keyano College and Norther Lights Health Region. "Wood Buffalo Business Case 2005: A Business Case for Government Investment in the Wood Buffalo Regions’ Infrastructure. March 2008. © & comprehensive analysis of projects supplying both diluent and feeder pipelines can be found in the National Eneray Boards, "Canada’s Oil Sands Opportunities and Challenges to 2015: An Update", An Eneray Market Assessment June 2006. > Ibid October 200750 Canadian Energy Research Institute region for refineries outside of Alberta, More about export pipelines and markets is reviewed in Chapter 5. 4.4 Natural Gas Use While not receiving as much attention as it has in the past, natural gas use will likely return to being a hot topic of discussion; previously eclipsed by a royalty review and perceived labour shortages in the province. For this purpose, we have moved our discussion of natural gas use into this section, The continue use of natural gas will produce challenges that could have implications for energy trading with the United States. Today, the oil sands consumes almost 1 billion cubic feet (bcf) of natural gas a day, or about one-third of Alberta's domestic consumption. As cil sands production continues to grow this level of consumption will surge, and could impact AECO-C natural gas prices. A scenario that is not likely to pan out for another 5 to 10 years. Using the projections, provided in Chapter 2, we have developed corresponding gas use projections, It is important to note that these assume natural gas remains the dominant source of fuel for use by oil sands operators. Large scale production of syngas could reduce the overall demand for natural gas by oil sands operators. Figures 4.1 to 4.4 depicted the gas requirements for oil sands projects, based upon the following gas use factors: Table 4.1 ____Oil Sands Natural Gas Requirements Gas Factor (mcf / barrel) In situ 1.10 Mining and Extraction 0.25 Upgrading 0.40 The projections shown in Figures 4.1 to 4.4 provide some insight into where gas use could be heading. The implications behind this projected gas use are startling ~ there will be a need for increased drilling (conventional and unconventional) activity in the Western Canadian Sedimentary Basin, LNG, or the brining to market of stranded arctic gas through the Mackenzie Valley Pipeline. Figure 4.5 presents the scenario for Canadian gas production and demand as it would be impacted if oil sands development achieves the Unconstrained level of production and {gas requirements, October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 51 Figure 4.1 Unconstrained Projection — Natural Gas Requirements 7.000 6.000 | Clupgrading r ri ) oinsity | | 5.000 +1 Mining end Estacion | 3 4000 | | | | | 3 5000 72 | 2.000 vl LTA 2007 2009 20112013 2015-2017 2019 -2Oat_ 2028 2025-2027 October 200752 Canadian Energy Research Institute Figure 4.2 Constrained Projection — Natural Gas Requirements 7.000 6,000 BUparading | in situ HAL 5,000 | mining and Extraction - ri 4,000 3.000 | | Gas Use - MMcticay 2,000 | "A | i olHHE 2007 2009 2011-2013 20% 2017 2019 2021 2023 2028-2027 October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 53 Figure 4.3 Constrained Projection with Capacity Curtailments — Natural Gas Requirements 7.000 6.000 | ‘BUperading | | insta 5.000 OMining and Extraction B 4.000 | | eal HY ALT | 5 000 | | 3 2.000 “al i 2007 2009 2011 2013 2015 217-2019 2021-2023 2025-2027 ‘As can be seen by Figure 4.5, in 2009 Canada will have to either curtail domestic consumption, or exports to the United States. This projection assumes that coalbed methane production achieves production volumes of 0.45 Tcf in 2009 and expands to 1.15 Tef by 2020. Over the 2009 to 2020 period oil sands demand for natural gas could start to accelerate rapidly, to a point where oil sands demand coupled with other sources of domestic demand create a shortage of natural gas in Canada to meet our domestic and potential export needs. By 2020, our projection implies @ shortfall in natural gas of 2.2 Tef. Market forces should take hold prior to this time, injecting additional funds towards other sources of unconventional production in Alberta and elsewhere. Funds will also continue to be directed towards alternative technologies for deployment in the oil sands. October 200754 Canadian Energy Research Institute Figure 4.4 Constrained Projection with Double Delays ~ Natural Gas Requirements 7.000 6,000 | DUparading in Situ 5.000 |! mining and stration 44000 {] \| 3,000 {| 2,000 | | | | 1) | | “jy ] | | : | FEEL | 2007 2008 2011 20132015 2017-2019. 2021 2003 20252027 Figure 4.5, Unconstrained Projection — Impact on Canadian Supply and Demand for Natural Gas Canadian Supply and Demand Balance October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 55 CHAPTER 5 ‘TRANSPORTATION SALES AND MARKETING Pipeline infrastructure and market requirements will have to be addressed to assist the expansion in bitumen supply. This chapter concentrates on the major pipeline routes, including existing and proposed (as of July 2007), and various market destinations to accommodate this expansion. 5.1 Transportation (Pipelines) Capacity ‘Adequate pipeline capacity is necessary to transport blended or upgraded bitumen to refineries as well as to supply diluent/condensate necessary to operate the projects. The current pipeline infrastructure in Alberta is not sufficient to transport the forecasted volumes and will need to be expanded to keep pace with growth in oil sands production. 5.1.1 Current Status of Transportation (Pipelines) Capacities Capacity is needed to both transport blended or upgraded bitumen to refineries and also to supply diluent/condensate necessary to operate the projects. Currently the capacity of regional oil pipelines that transport SCO and non-upgraded bitumen out of Cold Lake and Athabasca regions is 1.8 10%bbi/d (see the Table 5.1). The Cold Lake pipeline system delivers SCO and heavy oll from the Cold Lake region to Edmonton, Lloydminster and Hardisty with a capacity of 0.7 10%bbI/d. The Fort McMurray pipeline system is greater than Cold Lake system, with a capacity of 1.1 10°bbI/d, delivering crude from Fort McMurray region to Hardisty and Edmonton. Alberta has an export capacity of 2.6 million barrels a day of crude oil ~ using the Enbridge system, Terasen (Kinder Morgan Express and Transmountain) and several other smaller Pipelines. These are listed in Table 5.1. Clearly this capacity is insufficient to transport all the production forecasted. The receiving markets in the US and Canada are discussed in section 5.2. " Alberta Eneray and Utiities Board, (FUB), “Alberta's Energy Reserves 2005 and Supply/Demand Outlook 2006-2015", $T98-2006, June 2006. October 200756 Canadian Energy Research Institute Name Table 5.1, Alberta Regional and Export Pipelines Capacity = = o Seasces | © (10 Ebay cei Lake Area pipeines Cold Lake Pipeline Cold Lake Pipeline Husky Oil Pipeline Husky Oil Pipeline Echo Pipeline TOTAL ‘Athabasca Pipeline Terasen Pipelines(Corridor) Alberta Oil Sands Pipeline SCO il Sands Pipeline TOTAL “Fabaage Piping (rekedes Cando oT Terrace Expansion) Heavy Ol Hardisty Heavy Oi Edmonton Heavy Oil and SCO Hardisty Heavy Oil and SCO Lloydminster Heavy Oi Haralsty Fort McMurray Area pipelines ‘Semi-processed product Hardisty 300.0 & bitumen blends Diluted bitumen Edmonton 259.8 Edmonton 388.7 sco Edmonton 144.7 1093.2 Export Pipelines Eastern Canada U.S. East coast US. Midwest Kinder Morgan (Express) Crude oll U.S. Rocky Mountains 281.8 U.S. Midwest Milk River Pipeline Light oil U.S. Rocky Mountains 118.3 Rangeland Pipeline Cold Lake blend U.S. Rocky Mountains 64.8 Kinder Morgan Crude oil & Refined British Columbia 284.9 (Transmountain) Products U.S. West Coast Offshore TOTAL 2589.6 SOURCE: Alberta Energy and Utilities Board, (AEUB), “Alberta's Energy Reserves 2005 and Supply/Demand Outlook 2006-2015", ST98-2006, June 2006. 5.1.2 Future Plan for Transportation Capacity Expansion Future plans include expansion of diluent and feeder pipelines, as well as export pipelines to carry crude oil to various markets. Diluent and feeder pipelines in Alberta are expanding to transport diluent to the region and growing bitumen volumes to the major hubs of Edmonton and Hardisty. These proposed pipelines are described below. In order to ship raw bitumen to market through feeder pipelines, the bitumen, must either be blended with SCO, or a diluent (such as pentanes plus), to reduce the viscosity of the oil so it can flow through pipelines. Diluent on its own is insufficient to resolve the problem of how to move the bitumen to market; feeder and export pipelines are required to bring the blended bitumen or October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 57 ‘SCO to market (refineries) where it can be refined. The expected growth in bitumen production has resulted in many proposed pipeline projects and expansions. Based upon information from the National Energy Board (NEB), pipeline capacity leaving the oil sands region is expected to increase to around 5.8 million barrels a day by 2015." Table 5.2 summarizes the announced and potential pipeline expansions. Based upon CERI's Constrained production estimates, this capacity would be sufficient to allow bitumen, as a blend or SCO, to leave the region for refineries outside of Alberta; CERI’s Unconstrained forecast indicates there could be a shortage of pipeline capacity and potential for new pipelines to move excess capacity directly to the United States, or export to Asia; this depends on each pipelines ability to transport a bitumen blend. Under a scenario where SCO is blended with the remaining bitumen from our Unconstrained case, then there appears to be sufficient pipeline capacity to meet the needs of the industry when there is 5.5 MBPD of marketable bitumen production. For visual representation, see Figure 5.1 and Figure 5.2, which show the existing and proposed regional pipeline routes and existing and proposed export lines, respectively Ibid, October 200758 Canadian Energy Research Institute Table 5.2 Potential Pipeline Expansions Pipeline Type Filing Date Capacity Proponents’ = Market Increase Estimated (Mb/d) Completion . —— __ Date _ — : Proposed Alberta Pipe Projects = Enbridg Blended 7350 (max. 600) Mid 2008 Eamontor bitumen December "05 Diluent 150 Cheecham Enbridge Gateway dient une 06 150 Mig-2010 Alberta Enbridge Southern Lights llent NVA 180 19°08 Alberta Kinder Morgan Corridor dibit_ December ‘05 240 2009 Edmonton Pembina Spirit diluent Nya 100 Apnil'09 Alberta Pembina Horizon sco NA 250 duly 08 Aberta Access dit December'05 150 (max. 400) 2006/2007 Edmonton Proposed Export Pipeline Projects 75 Kinder Morgan Crude oil PADD V (Phase 1 TMX1) REPS Filed July'05 38 april'07 ———_Offshore/Far (Phase 2 TMX) Filed Jan. 06 40 Novernber ‘08 East Southern Option rude oi! 700 PADD v (rmPL To2)| ‘RPS 1907 100 January'10—_Offshore/Far (TMPL Tx) NA 300 2011 East Northern Option (THX) Crude oil NA 400 201 PADD ‘BRPPS Offshore/Far East Enbridge Gateway Crude oi June 08. 400 2012-2014 PADD V ffshore/Far East Enbridge Southern Lights Line 2 Expansion: Ecmantan to Cromer Crude oi NA 2009 PADD IL ‘Cromer to Clearbrook 103 PADD IL Clearbrook to Superior 3 PADD IL New sour line Cromer to 33 PRD IL Clearbrook 185 Enbridge Alberta Clipper Crude oll February "06 450 2o1o/t1 Southern PADD II Enbridge (Southern crude ait 315 Midwest) ‘nccess) Southern May "06 120 October '06& = PADD Phase { February ‘07 Nia 148 2008/08 Phase I Nya "7 NA Phase IL “TCPL (Keystone) Crude oil June 06 435 2009 Southern ExpansionSxtension 155 2010 PADD Il/ PADD UL Altex Energy | crude oit Nya 250 49°10 PADD IN N/A Not Available SOURCES: NEB, "Canada’s Oil Sands Opportunities and Challenges to 2015: An Update”, An Energy Market Assessment, June 2006. AEUB, “Alberta's Energy Reserves 2005 and Supply/Demand Outlook 2006-2015", ST98-2006, June 2006. RBC Capital Markets, Canadian Energy Summit, March 2007. October 2007ian Oil Sands Supply Costs and Development Projects (2007-2027) 59 ‘As seen in Table 5.2 many pipelines have been proposed to carry the forecasted bitumen production volumes from Alberta to various markets. The rate of expansion will greatly depend on market conditions and regulatory approvals. In the end producers will support the pipeline projects that will provide them with highest netbacks for their production. Additionally, the pipeline companies might take on too much throughput risk to advance the development of their individual projects in order to provide shippers with attractive terms, thus reducing the return on. the project beyond an acceptable risk-adjusted level. Hence, not all proposed projects might be completed. Figure 5.1 Alberta SCO and Non-upgraded Bitumen Pipelines Fothetray \ —tristing aac Lloyeminte 2 eno 4 Eobridge 5 Express SOURCE: AEUB, "Alberta's Energy Reserves 2005 and Supply/Demand Outlook 2006-2015", ST98-2006, June 2006. October 200760 Canadian Energy Research Institute Figure 5.2 Export Pipelines SOURCE: AEUB, “Alberta's Energy Reserves 2005 and Supply/Demand Outlook 2006-2015", ST98-2006, June 2006. 5.2 Sales and Markets ‘The routes of the new and expanded pipelines will depend on which markets hold the greatest potential. The industry will likely take advantage of major existing markets by maximizing its volumes to western and eastern Canada, PADD” II, PADD IV and Washington State (i.e. PADD V), with the potential for further expansions to California, PADD ILI and markets in the Far East, such as China, Japan, Korea and Taiwan. This section reviews the existing Canadian and export ‘markets for crude as well as looks at the potential for new and expansion of existing markets PAOD stands for Petroleum Administration for Defense Districts, There are 5 PADD regions altogether and they were implemented during World War II to faciitate ol allocation, Refer to EIA for full description: http://www.eia.doe.gov/pub/al_gas/petroleum/analysis_publcationsjail_market_basics/paddmap htm October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 61 5.2.1 Current Status of Sales and Markets (by destination and by product) ‘The current market for Alberta crude encompasses western and eastern Canada, upper PADD II, PADD IV and Washington State, with smaller volumes going to PADD I and III, as shown in Figure 5.2, Table 5.3 Domestic Exports of Western Canadian Crude Oil in 2005 (10° bbl/d) Refining Refining Conventional Conventional Blended Market Capacity Runs Light” Heavy SCO bitumen Tot Wecanada 632 576 234 a 20 » sn Ecanada Ontario 467 04 84 2 4 4 195 Canada - at 1.378 1,284 8 R 4 “4 185 Total Canada 2,010 1,859 9 26 245, 68 27 T Tnclades condensates and pentane: plum SOURCE: NEB, "Canada's Oi Sands Opportunites ar Challenges to 2015: An Update”, An Energy Market Assessment, June 2006, In Canada it is a relatively small refining market with 19 refineries totaling in capacity of almost 2 MMb/d (Table 5.3). In 2005 the Canadian refineries operated above 90 percent of their capacity to meet the domestic oil demand. However, they will not be able to absorb the growth of oll sands produced due to the age and lack of complexity of these refineries, There are a few announced projects to either convert existing refinery to process solely oll sands derived crude oll, oF to increase the refining capacity, or to construct new upgraders to process heavy bitumen. If these plans will be executed, they will predominantly be developed in Western Canada, ‘The refineries located in western Canada process exclusively western Canadian crude, including oil sands. In 2005, SCO and blended bitumen made up almost 40 percent of total refined crude. To increase the proportion of oil sands derived crude ail in western Canada, Husky, Imperial, Petro-Canada and Shell who own refineries and produce oil sands will look at the ways to incorporate their upstream production with downstream operations, In 2005, less than 50 percent of Ontario's crude oil demand was met by Western Canada sources, and only 22 percent of that total was SCO and blended bitumen. It is believed that there {is room for growth opportunity to take more western Canadian crude oil in Ontario and Quebec. Companies, such Imperial Oil, Suncor, and Shell Canada are all laoking at possibilities to integrate their oil sands production with their downstream facilities in Ontario. ‘The United States with a refining capacity of 2.6 million m'/d (16 MMb/d) remains Canada’s largest market for crude oil and will probably has the greatest potential for increased distribution of oil sands derived crude oil (Table 5.4). October 200762 Canadian Energy Research Institute Table 5.4 _Exports of Western Canadian Crude Oil to US in 2005 (10° bbI/d) Refining Refining Conventional Conventional _Light_ Blended Market Gacy "Rune ght" Heawy_symetic Bitumen _ Tota prool ss aR 5 0 Q st a0 3533307 n 558 ° i 1096 a0 tt 79827008 1 ° 1 ; Oo oa00 sss 563 2 4s 3 vm 00 v as 2093 5 5 1° er Total vs wean 1 ne hs a 160 ‘includes condensates and pentanes pus SOURCE: NEB, “Canada's Oil Sands Opperturities and Challenges to 2015: An Update”, An Energy Market Assessment, Sue 2005. In 2005, Canada supplied almost 10 percent of the US crude oil refining needs, becoming one of the largest crude oil exporters to the US. Ongoing war and geopolitical concerns in the Middle East hamper the security of supply for the US, which drives the decision-makers in the US to look to Canada as a secure source of crude oil supply in the future, PADD I is not considered 2 market with a large growth potential for Canadian oil sands. With a refining capacity of almost 1.5 MBPD most imports into that region come from eastern Canada (On the other hand, PADD II is so far the largest market for western Canadian crude oil in the US, with capacity to refine over a half a million cubic meters a day. Seventy percent of Canadian crude oil exports went to PADD II in 2005 (see Table 5.4) and SCO and blended bitumen comprised 20 percent of that total, Also, the core markets of St. Paul and Chicago in northern PAOD II are predominantly heavy and medium sour refining markets, which suit the needs of oil sand producers. Producers have also been able to deliver to southern part of PADD II, to Cushing, Oklahoma, with the recent reversal of Spearhead pipeline in March 2006.” PADD IV in the past had been an important market for Canadian heavy crude, with refining capacity of almost 600,000 BPD. However, recently, with crude oil prices hitting the record high levels, the producers of PADD IV have been dling for oil at a greater rate. This has resulted in an increased oil production, which has led to pressure from domestic producers to process this production in local refineries. Consequently, refiners in PADD IV are processing less western Canadian heavy crude supplies to facilitate the refining of available and discounted Wyoming sweet and sour crudes. This situation is assumed to continue as long as the crude oil prices remain above US$50 per barrel, > bia October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 65 CHAPTER 6 SUMMARY AND CONCLUSIONS With intial established reserves of 178.7 billion barrels of bitumen, and the potential to recover close to 300 billion barrels, Alberta's oil sands are considered one of the largest deposits of cil in the world. This report provides an up-to-date evaluation of the likely production volumes from announced oil sands development projects (mining extraction, in situ recovery, and bitumen upgrading), the available pipeline capacity to export the produced bitumen, oil sands producers’ energy requirements, and the associated supply costs of crude bitumen and synthetic crude cil streams, given recent market price changes. The analyses were conducted for two types of it situ recovery—cyclic steam stimulation (CSS) and steam assisted gravity drainage (SAGD)—and for surface mining and extraction, for tegrated mining, extraction and upgrading, and for stand- alone upgrading ‘The production Projections examined for this report, are the Unconstrained and Constrained Projections (Constrained, Constrained with Curtailments and Constrained with Double Delays). In all Projections, oil sands output is expected to rise dramatically over the next decade, as shown in Figure 6.1 Figure 6.1 Unconstrained and Constrained Cases Crude Bitumen Production 000 4000 000 2000 I i 1,000 2007 2009 201120132015 01720192021 202320252027 Unconstained = “Constrained Constrained with Capacity Curtalments = * Constrained with Double Delays ‘The Unconstrained Projection assumes that all announced projects proceed on schedule and as planned, while the Constrained Projection provides a more realistic supply projection that takes into account a number of limiting factors: capital spending, labour supply, market access, market Uncertainty, material supply, environment, and regulatory access. October 200766 Canadian Energy Research Institute The Unconstrained Projection increases gross crude bitumen production from 1.321 MBPD in 2007 to 6.007 MBPD in 2027. Full details of the Unconstrained Projection are provided in the report. Synthetic crude oil production increases from 802,000 BPD in 2007 to 4.464 MBPD in 2027. This Projection, however, is less likely to develop. ‘The Constrained Projection: Gross crude bitumen production increases from 1.321 MBPD in 2007 to 6.024 MBPD in 2027. Full details of the Unconstrained Projection are provided in the report. Synthetic crude oil production increases from 802,000 BPD in 2007 to 4.470 MBPD in 2027. While achieving similar levels of production by 2027, the growth rate of the projects are less than in the Unconstrained Case. ‘The Constrained Projection with Curtaiiments. Gross crude bitumen production increases from 1.321 MBPD in 2007 to 4,951 MBPD in 2027. Full details of the Uncanstrained Projection are provided in the report. Synthetic crude oil production increases from 802,000 BPD in 2007 to 3.603 MBPD in 2027. While achieving similar levels of production by 2027, the growth rate of the projects are less than in the Unconstrained Case. ‘The Constrained Projection with Double Delays (and no curtaitments): Gross crude bitumen production increases from 1.321 MBPD in 2007 to 6.000 MBPD in 2027. Full details of the Unconstrained Projection are provided in the report. Synthetic crude oil production increases from 802,000 BPD in 2007 to 4.474 MBPD in 2027. The methodology for developing the Constrained Projection takes into account plausible delays, and likely adjustments to the planned capacity and production of future projects. Delays and probabilities are applied to each of the announced projects, relative to their planned start-up date and production capacity, corresponding to the projects position in the regulatory process. Projects further along the regulatory process are given smaller delays and higher probabilities of proceeding to their announced production capacity. Upfront delays postpone project start-up dates. Multipliers—estimated probabilities of projects actually going into operation—-are applied to the planned production capacity to adjust the production projection. 6.1 Capital, Operating and Supply Costs The base Projection reflects a constant C$6.56/G) AECO-C gas price, a 2.2 percent inflation rate, and a stable foreign exchange rate of USS0.83. Determination of the WTI equivalent price — at both Edmonton and Cushing ~ assumes that SCO is used as diluent (sourced from Edmonton or uupgraders in Alberta's Industrial Heartland) to move the raw bitumen from the field to the Edmonton or Cushing HUB. For this purpose, a WTI price (sourced at Cushing) at of US$65.00 has been assumed. Based upon industry data, a 5 percent premium has been applied to the cost of diluent. In 2007, our model uses a “cost of diluent” (SCO) purchased in Edmonton as $79.29. CERI also examined the sensitivity of costs to changes in key variables. October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 63 Currently, Washington State processes 11 percent of its crude requirements from Canada, This volume of supply is largely dependent on availabilty of Alaskan North Slope crude and capacity constraints on Kinder Morgan's Transmountain pipeline. The industry is really enthusiastic about increased supply of western Canadian crude oil and this is seen through the number of cokers and refinery conversions that are being discussed in that market. ConocoPhillips, Tesoro and British Petroleum all have plans to process heavier crudes, which will include oil sands crude oil 5.2.1 Future Market Projections ‘The traditional market for Canadian crude oil has been refineries in Canada and the US northern tier. As more bitumen is produced, more upgrading will be needed either at refineries in Canada or in US. Another option fs countries in Far East: China, Japan, South Korea and Taiwan. This section covers the future market projections in Canada and US. In Canada, there are a few announced plans to increase the refining capacity to assist with growing bitumen production, Petro-Canada, for example, is planning to convert its Edmonton refinery to process only cil sands feedstock. It is estimated that by 2008, 100 percent or 21,400 mid (135,000 b/d) of oil sands feedstock will be processed at that refinery.” In addition to upgraders, there is a publicly announced proposal for a new refinery complex in Alberta. This is currently being studied by Alberta Energy and 19 stakeholders. This project could be completed as early as 2011 with initial capacity of 47,700 m’j/d (300,000 b/d), which could be expanded to 71,500 m’/d (450, 000 b/d). The refinery would also include a petrochemical facility and 500 MW coal-fired power generation plant. As well, in eastern Canada, Ontario is expected to increase its use of SCO. According to one of the industry studies, Ontario's demand for SCO will be approaching 120,000 b/d by 2010 based on favorable priding of light sweet crude substitution. > In the US it is expected that in the short term the industry will exploit the existing markets of PADD II, PADD IV and Washington State to their potential with further expansions later on into California and PADD IIL ‘The southern region of PADD II is becoming increasingly significant market for Canadian heavy crude. The reversal of Spearhead pipeline has helped to open up other locations that did not have access to Canadian crude before, By extending the core market of PADD II further south. into areas of Wood River, Cushing and Ponca City, Canadian crude oll could compete with other foreign and the US sour grades of crude and this would result in better crude prices for Canadian producers. Northern PADD II is currently the largest market for Canadian crude oil and is well positioned to run increased volumes of bitumen blends and SCO because of complexity of the refineries. Many companies have expressed an interest in arranging some sort of “integrated” deal between their refineries and oil sands production, The list of announced projects in PADD II together with other propositions in the US is shown below in Table 5.5 % Petro-Canada, http://vaww.petra-canada.ca/en/media/ 1886 aspx7id=576106 ° Purvin&iGertz, "Potential of US/Northern Tier and Canadian Markets to Absorb Heavy and Synthetic Crude”, May 2003, October 200764 Canadian Energy Research Institute Table 5.5 _ Proposed Refinery Expansions i coeeee Coker or Date of _ anaes _tecation aus Expansion Completion — Tesoro Anacortes, WA 15 Coker 292007 Cenex Laurel, MT-——-No change Coker 102008 (15 Mb/d) Sunoco Toledo, OH so Expansion 2008 Flint His Resources st, Paul, MN 50 Expansion 12008 Frontier Oil El Dorado, KS u Expansion 3008 Frontier Gil Cheyenne, Wy na Coker 2008 Sinclair Sincai, WY B Coker 2008 United Refining Warren, PA 5 Coker 2009 ConocoPhillips Wood River, IL 55 Coker 2012-2015 ConacoPhilips Borger, TK 25 Coker 2012-2015 ConocoPhillips, Ferndale, WA 25 Coker 2012-2015 ConocoPhilips Bilings, MO fa Expansion 2012-2015, n/a ~ not available SOURCE: NEB, “Canada's Oil Sands Opportunities and Challenges to 2015: An Update”, An Energy Market Assessment, June 2006. PADD III is of particular interest to western Canadian oil sands producers given the size and complexity of the refineries and the chance to compete with Venezuelan and Mexican imports, especially since bitumen blends have been heavily discounted in the US Midwest. Altex Energy Ltd. is proposing to build a new direct route oil pipeline, which would transport crude oil from northern Alberta to the US Gulf Coast. PADD IV will remain to be a marginal growth market for Canadian crude oil, in particular SCO and blended bitumen due to declining light sweet crude supply in that region. Recently, Holly Corp. announced a sale of its Montana Refining Company to a Connacher Oil and Gas Ltd. This refinery will provide processing to the SAGD production from their Great Divide oil sands project and well as give some protection against wide light/heavy differential. The California market is an attractive market option for heavier crudes because California's Tefineries already process predominantly sour medium and heavy crude oil and rely on two sources of supply that are in decline, namely in-state and Alaska production. However, access to California is not likely to happen in the short term and will depend on the supply from Alaskan North Slope. October 2007Canadian Oil Sands Supply Costs and Development Projects (2007-2027) 67 Table 6.1 ‘Summary of Capital, Plant Gate, and WTI Equivalent Supply Cost SAGD Unit Capital Cost Plant Gate WTT equivalent. ($C/bbl) Supply Cost —-$US/bbI at : _(C$/bb1) Cushing Cyclic Steam Stimulation—CSS 23,095 35.08 SL Steam Assisted Gravity Drainage— 24,733 36.93 57.64 Mining and extraction 38,794 35.03 56.56 Integrated mining, extraction and 82,365 64.39 65.51 upgrading Stand-alone upgrading capital, 43,571 27.06 nia _operating and supply costs 6.2 Selected Industry Issues As oll sands development accelerates, a number of related issues are generating concern both locally and provincially. These include potential shortages of labour, materials and equipment, environmental concerns, and the availability of natural gas to meet the demands of the oil sands. It is possible, that by 2009 Canada will either have to curtail domestic natural gas demand or exports to the United States, if we are to remain at current and projects consumption patterns ~ notably is the Unconstrained Projection for oil sands development where the demand for natural {gas peaks at almost 6 bcf/d by 2018, as shown by Figure 6.2 below. 7,000 6,000 DUparading ln situ 5,000 | Mining and Extraction [ Gas Use - MMefiday 2,000 | 1.000 0 I. JU 2007 2009 2011 2013, Figure 6.2 Unconstrained Case Natural Gas Requirements 2018 2017 2019 lt 202 2023 2028 2027, October 200768 Canadian Energy Research Institute Under a scenario of reduced growth and delays, oll sands natural gas requirements would reach a more modest 4.3 bef / d in 2018, peaking at 4.6 bcf /d in 2025. This scenario is represented in Figure 6.3, Figure 6.3 1ed with Capacity Curtailments Case Natural Gas Requirements sow | | | | ainsi | 5.000 || EaMining and Extraction 4.000 | | | 3,000 z HTT | 1,000 | Gas Use - MMetiday off 2007 2009 2011 2013-2015 «2017, 2019-2021 2023-2025 2027, While these issues are important—even potentially critical to oll sands development—they could be resolved by market forces, though many believe they should be addressed through policy changes. Given the politcal nature of some of these issues, CERI has discussed them briefly, but has not conducted an in-depth examination. If there is one certainty with the oil sands, it is the global interest in the resource. Many Asian economies, notably South Korea, China and Japan have expressed interest in either contributing directly to the development of the resource base, and/or securing a reliable and political stable source of output from the oil sands. October 2007L002 124010 Seog ates o ue |savoc parody pase | SL6E LLoz | panouddy £ BS2Ud oo | suse | 6007 panosddy | 298eld a] sists | _zo0z 5ei0eo 1 386d _ = [ : : wowing | —— (§80=0 ‘GOYS=1 JeulO=2) 30K = Sdyiiydo20u0y eur | annenoedg | volsuedxa payiuepiun, __t | “oes [oz | einsopsia eee eceia Ea (S0=0 ‘GOVS=t ‘seuId=Z) adé 1, a oo rons rae |e coca | Sciacca Sea Teset = ee (S$0=0 ‘GOYS=1 VaWiO=2) adh, ajqeoydde axaym — (Kep / aq) | | “(hep saa) Mjsedeg —-Aypedeg | ave dn-verg 098 peounouuy” _peounouuy | peounouuy smeis uondisoseq yo9fo1d j 69 Suoi6ay 4nry aeed pue /axe7 plod ‘eoseqeuay ~ s3>afo1d NUS UT S1ST1 193COd - V XIGNaddv aanggsur yoseasey A610u3 uelpeues£002 12903220 — 1 t a a ds = |_s0ss ‘o10z _ zaseud 1 1 : c [ses [so0e veseua TL = cease] — Serene | . = (g80=0'GOVS=1 J0WO=Z) adh — uonsa — (Tz sic ous oo J fo ie | ce + - - ee —+— = a | Geo ‘coyS-1 "2ulo2) ea : _ (uonag) epeuegonog = 0969 ‘anienoadg | —~=SS~SC YS Bay WaBANOS | 2 2 [ose ira aunsopsia acess = — | ove'z | e002 ansopsg ee oseud |b a a oes oe wonannisu0g zaseud | 1 — — v002 Sunevedo 1 9seud | b = yaaig uAsor (g$9=0 ‘GOvS=1 eui0=2) 20K - al (£70Z-£00Z) sPaforg quauidojanag pue s3so3 Ajddns spues [10 UI o££007 12q020 | - | sz 002 Buneiado eo - { | | wr) (g80=0 ‘GDvS=1 48ui0=2) 6041 =e) I a 002 £002 _ Buneiedo jee. |b I : 7 eoseaeuy (SS9=0 ‘GOVS=1 eNIO=Z) edKL T c case | aon _ eam | os? 2002 uononasueg | rong |b Ll ollg [PuoIBay aye") EUNSYD = 3$0=0 'GOS=1 49UiO=2) adAL | | 93 ose | aioe panoiddy peseua | 1 056.2 108, panoiddy ceca |b _ osez | p07 panosddyy zaseud | | | 0662 zioz panosddy voseud | =) : asuung (S$0=0 ‘GOWS=1 seUlO=2) ed | ASH t | | ‘aneinoads | uoisuedeg paynvepun | 1 a 008 ‘9002 Buneiodo Wild |b | | spuesowun | | | ($80=0 ‘aovS=1 Y8uI0=2) adh Lo (uouo) yuegoneg 2 ‘eyngysuy yseasay A6s9ug UeIpeueD£002 124020 LL | | I [ canteen as fe | ves's | one. peounouy | _ based |b _ a | | | moeea ($8920 ‘GOvS=1 veUId=Z) eK | fae [ | = | 009" 6002 Vesela 1 | - —~ | seb | o6s't L007 Bunevedo : b pod | ; t | 1 is sa=0 ‘gost seuioez) adh | sep pur 10 sayoeUU0D | T canals [eee eee | ese'9 [emeinoads 1 aseyg I | i it pred j (889=0 ‘GOVS=! JeUIO=z) adAL ae { epeueg-oneg i I | ove's e102 peounouuy | Uojsuedxg peynuepun | | | obese ited paounouuy volsuedx3 payiuapun 1 I a I ove's 0102 peounouuy uolsueds3 paynueplun | L = | ae aea0a | | = (SS0=0 ‘GOvS= JeUO=2) adh ae a eueou3 | | | ae 868 002 — | (g$0=0 ‘OOVS=1 VOU=2) Sah (4202-2002) s120f014 quauidojanag pue sys09 Aiddng spues [10 WeIpeueD o£007 1290190 i - 1 = = | | se | ioe PoOUreNAN al 82's t e102 (s6z'6 8002 ‘vononasuog | —vaseud | = _| e002 | ‘Guneseado | (poe pud-Jea,) saniioe4 Sunsixg | 1 | an fae I oo ‘227 6407 | ie = ($80=0 GO¥S=1 JeNIQ=2) adh | | UaxON/LLAO | a | “I [ osez | er0z “ainsojsig | ypaloud jemsewWoO | L 7 06S't 866) Bunesedo | (Z00z pus-s88,) Se 1 eee | | — | | { (ss0=0 GOvS=1 18410=2) 9a | soovr L oe 1 eee : 2 = sorr | eoz_—«|~—pacunouuy | uoisuedyg pi I I 6reL | tho | ———paounowy | uorsuedx3 pi i goer 600z paounouuy uo/suedeg paynuepiun I | oe 806'L 002 panoiddy : squawisnipy 6/z aseud | _| I 86 z00z. Sunesedo | (Zooz pua-seaA) sanyoes Buns | 5 =| | / | | | : | ($89=0 GOVS=1 YeUIO=Z) aah | euegua | tL a¢nyASUT yoseasay ABs9ug uepeueD£002 129020 ore ooo, | suoz paounouuy gaseud | 1 | ae orr'o ose'e | t0z peounouuy | Zaseud | 1 | __orr'a | osee e102 paounouuy geseud |b | eee [ovo [ose fan paounouuy seseud | | a] 40S" oss's e002, panouddy peseud |b | tos’ oss | 002 | ——penoxddy ese |b = oie oT oyonusuog | worsuedx3 pue uonexoueGo9 | 1 i | v0 o9s‘s 9002 Bunesedg zaseud | | | bee’ | ovz's oo based | 1 260 =| I Z o0z Sunevado cise a i { Seqouig | (880-0 GoVvS=1 J8uI0=2) adh | young | | _ ose’ ainsojosid LC — 7 suo - | : = | 6569 { panouddy — Zaseud | 1 a esto panoiddy | ~_beseud | 1 i | | : | 91 MOpeaW | __| I 7 1 : |__ ese’ onoz | uoneonddy | vuorsuedx3 2 { [ose | zooz | _—‘Suesedo Suonevedo Bunsixg |b 4 ($80=0 GOVS=1 VeNO=2) edAL (4202-2002) 5120f014 quaudojaneg pue s3s09 Ajddns spues 110 ueIpeUeD | sang feyoen epeueg-oneg we£002 4290920 00°F zz | 21ns0;9810, Zaseud |b 2 | 00911 6002) ——_uoNeaiday Laseud | 1 __| : | ($89=0 GOVS=1 V=iO=2) aAKL | qwnowereg/SOvN { I oul’ ezoz paounouuy | py aseug v OL’ ozoz_ | _—_—~paounouuy easel |b a | OLL'F 8102, ee eee OLL'P. 9L0z, paounouuy beseud 1 i | ayer | | 21108315, _ I ‘OUIO=Z) OOK : —_ | f al “oLL'y 2102 __paounouuy easeyd |b | oly 102 sounowuy zaseud |b ous'y | e107 paounouy Laseug | Ll | {nig U) uozZHOH) ure\UNOW YouE | { I (SS0=0 ‘GOVS=1 JeuIO=Z) adh TINO | 1 S90'LL Beh S102 peounouuy Zaseud |b E zes's ese’ 1 L0z paounouuy beseud |b =] | | ogee | | | (g80=0 ‘GOVS=! ¥eulO=z) ad I wonearg anien SL ‘ayngnsur yueasay A6.0U3 UeIpeueD£00z 4990190 Feb 2661 Buneiedg ~___Sanyoe Bunsreg | | i le | qWidd 413 | . ($S9=0 GOVS=1 soUiO=2) adh : I I Se6L t Bunesedo ‘soqmoey Gunsixa | 4 - | = Bieqpun (g80=0 GOWS=1 V0NO=Z) dk e002 woneaiddy 1523 s501WUd 0 9007, ‘Buneiedg ion aso1ung | 0 ‘9661 Buneiedo | _(pooe pue-sea,) sanioey Sunsxy | o LL =] | orsuedx3 @¥e7 slonn # ASOsL | | ($800 g0vS=1 U0=2) af TEND I t = [oes [600g pasunouny _ ao fo dk, = __yp0i9 Kemeny oo _ ~___so=0 Govs=1 semo=z) eck [ _woneoi9 onien | = t ___ 00022 910e BNSO}OSI | £ 88bUd | | J (2202-2002) s122f01g quauidojanag pue 53509 Ajddns spues 119 ueIpeuey 92£002 489020 (ss0-0 ‘ao¥S=1 souo=2) adh 7 || I 2x27 Plog - s}99fo1g Buneredo 19410 T | ‘WHON our goo | __poroxidy | _ueyiueny ‘afigen ai-ri saseud | 0 _| { OLL'y £002, Sunesedo | ‘SASOYYRIN EL-LL SASEUd | 0 I BIS'Lh S861 as Buneiadg | (g00z pue-seea) sanwoey Bunsix3 | o os | a Gieipeo!| ae | = (98020 GOVS=! 1eui0=2) 9K a Wo evodu oue'y 2002 | (ieedG | date eee) ee = 2 2 (sso=0 GovS=1 Jeuio=2) sd a = isn I a za | zee Guneredo sonqoeg 6unsixg | 1 | a l ‘asouug | aa {gS0=0 ‘GOVS=1 sau0=2) aah ine SERRE | | co sor 102. paounouuy wolsuedxg paynvepUN | 1 7 69u'b 6002 | paounouuy Testes pamepon as | y9s's 2002 paounouuy uolsuedx3 paynueplun | L i ost 2002 uoqonysuog {9002 pue see) uoisuedx3 | | | ole’ sooz | {e002 pue-ea,) sane Bunsie3 | 1 [ uy. e002 (roog pus-ze9,) sennoes Bunsns | 1 399819 181504 | (S80=0 ‘GOvS=1 VeUIO=Z) ed | euegua | “a ‘aanqnsur youeasoy A6s0Ug ueIpeueDAyoeded [eo £002 429020 a [00% S102 woneoiddy € a8eug 9019 voWeD | z I a o'r zu07 ~uoteaicay Zaseug ¥9919 uouwen |Z ; | _ ‘0008. e002 uoneoddy | 1 38euq 19810 uoued |Z | : ooo | suet ___Bunevedo | (zooz pus-se9a) sonmioey 6 z 9019 uoUNeD / aye" aHOpED | Y9WNO=Z) edK oa Buyeiedo | L i | | 2¥2 HON HO NUORXS | | ($80=0 ‘GOVS=1 J8NIO=2) ack q] I [or 1661 Buyesado | L [ t t ~ foo | | Biogpurr- Aydin es ! (S89=0 ‘GOVS=1 ‘JeWIO=2) och, I t | * 0861 Buneredg | L (4202-2002) s2fo1g uaudojanag pue s3s09 Aiddns spues j19 uejpeue>, Siagpury - exononed 8£002 424020 = woneonddy | —_€ 88eyg 98:9 wowed |Z [goer woz | __peounowuy | Z 95€Ue 99930 vOWED |Z | I 002 200c__| yononssuod Laseyd yaasp voUeD | Z : a | eee [zs | so02 Bunesado | (9002) somuoes Bunsnxa | z [eae ae | a ml = 1e9s = (g$020 GOVvS=1 T8uIO=2) adAL | | som Uae | Po oa Aygedes jeOL | oe 00 S107 € 282g 10019 VOWED | Z | | o00'# zhoz ~ zaseue waaD vowses |Z zi | 0008 cooz__| Laseyd ¥8819 uowues |Z, | ae oooz | seer Bunevdo (Z00z pua-1e9a) sonnsey Gunsnxg | Z | 1 I | (S89=0 ‘GOVS=1 saNIO=Z) ACK, ious LL Ryoedes (210, | — [_ o00'r stoz uoneayddy €aseug Wea! uOWNED |Z = coor | ztoz woneaiddy Z 28eyg 9019 vOWHED | Z =a ‘00'@ 002 “uoneaiddy |} aseya yeain uowses |e — 000% S64 Sujeiedg | (Zong puese9,) sense, Bunsxg |Z I Hianes 10S ($$0=0 ‘GOVS=1 200=2) eck | 6L ‘aangysur yoseasoy A6s0Ug ueIpeueD£002 429020 “2. 88eUd | J cowie 2102 ainsoiasig 1 seg a ore TT | a 7 | ae [— cos'sr | zioz 2ins0095i0 | 29sec | Loose | onoz panouddy | fe Ze a uy audyoer ——_ . : : : {___ = SS —_____f| _ r puosveds | See aa i: oS SEs ala eee | ee al Zuosuedxg ose: | ovoz panoiddy | uoisuedxgjuoneziundo ol oog'rz | —_-z00z Guneiedo | (007 pue1e@a) santioe4 SunsIKa, . : a) | | | | i | a - : a supysony Says | ee efor spurs no easeaetny (Aep s1aq) fupedey seq dn-ueig _peounouuy —_paounouuy smeig uonduosag yaforg (4202-2002) s120f014 wowdojonag pue s1S09 Alddns spues j10 ueypeues sqpefoig Guu og£007 1290320 18 - 06's: aioz | _panoxddy ron = 1 006'SL Z10z pancuddy Zaseud - ot 006'St o1oz panoiddy 1 882d | i a aye] Leay | - | | aol sez 610z paounouuy | (aul winog) » aseug | 0862 910 | peounowuy (oviw wnog) ¢ eseucl | I oa 0s6'2 | _£402__|_voneouddy | (oulw Won) 2 eseug =n 0362 o1oz | _uoneouedy | (ouiw won) + asec ca] | | uy ulisor 7 7 | oF | | __ (49019 1980) 12101 | z0v'6 zLoz uoneoyddy Zaseug - i Zore voz | _uoweauddy | rossi | 1 | 514571 wauvon | ; | | oaueuks ‘ayngysuy youvasay A619U3 UeIpeueDcose | azo “coos sane (20z-2007) s329f01g quaudojanag pue 53509 Alddng spues [19 UeIpeUeD £007 4940~0 __e/z 88eud = — 1 Seu SIH HOS I YOELSLN/PEULDO:IE | zB£002 42q020 £8 [ave Te | peaaroy Tose p abs L__88z'9 zhoz___| _woyonsuog ____yeauamioqad ¢ a6e1g : [ oor'ee 8261 Sunesedo | (so0z pue-sea,) semjoes Bursts i - = —| | . = a a ears zoe —nnag maberon | 7 [wevez [one Penoiddy | ___uolsueng yueqaarg yUON a zoe e002 | uoronasueg | ~ypeuemoged wnuualnny a oze | 9002 Sunesedo | ___ypauatjogeg yueqdaaig : Zrs'Se i961 | Bunesedo | = au esea | —— - — sooung_ (Tier Tie famomny | ______-s seu | [seer sioz__|_paounouyy 282 Lore ponoiddy — faseua | | “2is'9 penosddy | Zaseues ere | goo wononsuog - Leseud 1 [wownig | = az ozo (kepsiaq) | Aypedeo, 09S s1eg dn-veig | _posunouuy _ pedunouuy smeig uonduoseg 1elo1a sypefoig SuipesBdn pue BuIuW pares6aqUuy ‘aaMyysur Yyoueasay A610U3 UeIpeueDL00z 1240390 legen ores ioe | ansopsa | [2060 toe oinsopsia Leseua t oo 7 | — meonanuseasouey| | | = - unowieiea/sOvN oowet zioz | —pennddy | © 888d | ooe'e 102 panoiddy | — zeceud| =| oog'er 8002 _uoronssuog "1 al | | | oe Japei8dn auoje-pueis pueweay | I fine va | 02001 zige panoiddy | zaseyg saekon | | : 981 02 oz panosddy 1 ase 152K) | | 2 ee ee | | ' epeeceoee, eet | azz | ee ce] (Aep | 144) fiedeg | aeq | 098 dnueig _poounouuy | pesunouuy (2202-4007) swafoig quauidojanag pue 53505 Aiddns spues 110 ueIpeueD seis 1989q 199f01d spafoig BuIpes6dn (2115-110) auory purrs, ve£007 4290190 se i t 68'S Lioz__|__peunouuy | Zaseud 68'S pie aaunouuy | L352 | i: ol Jepei6¢n wowing iusisor a : a reves : 7 7 ~ t 4 6re'2 102 paounouuy | zeseug | =] =e use| zu0z peouneuury | Terai aaa aos | - 4 | — ND I aac ne t 7 amma Leet 2102 paounowuy peste | Lee S102 paunouuy £ aseud | aaa! [asv'9 e102 peounouuy | Za8eudl | [esv'9 ira peounouuy | : vaseud | =| | Jepesbdn Ays@nie | | IO J8ny seg ore’6 ioe a ~easeud fal TT ors’ zu0e | Zaseud | [ ovs's o10e I 1 98eue | | | | Aug Burpes6dn BurpesBdn ysemyrion aingysur ysieasay A619U3 uelpeues£002 429020 68'S) 6L0e | uoneayddy |p 8d 2H JOpesBdN) = L102 uonenidary f eseud zi sepeidn | fa "6e’s1 | soz uoneaddy Zeseud zy sepesécn : | |__868's1 €10Z voneoiddy | SL Seg ZH JepesBdN, a eoe'sh | ioe ‘aunsojosiq | ‘pi uolsuedK3 —— ae 269'S1 zu0z ainsopsig | 1 uo1suedx3 = — ges's) [ zioz_ | ainsorsiq | zxuosuedxy | ene I ‘goes, | zioz aunsopsig ve uosueas = I Toro | panonddy | woysued penaxdy . (Zooz |__ zvo've zo0z Sugesado pue-s8,) saqoey Buysixy I | I sapes6dn piojoog: = se Heus | zvez | voz | : = e1@ 25eUe | | ocize | t10z 1 858d a | ___tepesBdn uoaumg | : | : { Sins epeues-onod (ogee 2102 - zaseud oa) = |__996' | OL0z . aseud —— 2 JepeiSdn siy6r] WeyLON I l oousuks (2202-2002) s399f01g quouidojonag pue 5505 Ajddng spues 110 uelpeueD o8£002 429020 2002 (ez Tiwononnsuog) wasn | imam I a ___x@jdwog Asouyay | sapei8dn evoowjens ns Za : - epeueg-onied | ] (voo1spee4 | giz noe pacunowuy | _vewing eveaiy) 1H UoIsuedXS | 2002 Uwononasu0g | yoauyomogag | { | | (zooz | voz Sunesedo pussea,) samyges Suns | iL i: vossuedxg seisunupsory | : 7 7 = arn csenee| ‘Asn “3 ‘aymgnsur youeasoy A610Ug UeIpeueDAbout CERI LL LTE EL EL ET The Canadian Energy Research Institute (CERI) is a co-operative research organization established through an initiative of government, academia, and industry in 1975. The Institute's mmission is to provide relevant, independent, objective economic research and education in energy and related environmental issues. Related objectives include reviewing emerging energy issues and policies as well as developing expertise in the analysis of questions related to energy and the environment, For further information, see our web site: