Canadas Oil Sands

April 7, 2014

Canadas Energy Development

Energy

Economy

Environment

Global Primary Energy Demand

Energy
Demand
Growth

Population growth
Standard of living

20,000
18,000
16,000
14,000

All Forms of
Energy,
Developed
Responsibly
Technology Key Lever
for
Sustainable
Growth

Ongoing high reliance

on hydrocarbons
Increasing role for
renewables
Shift to non-conv. oil
& natural gas

million tonnes oil equivalent

Other Renewables
Bioenergy
Hydro
Nuclear
Natural Gas
Oil
Coal

12,000
10,000
8,000
6,000
4,000

Production
Cost competitiveness
Environmental
performance

Ongoing reliance on fossil fuels

(share of energy consumption):
2011: 82%
2035: 76%

2,000
0
2011

Source: International Energy Agency New Policies

Scenario
World Energy Outlook 2011

2020

2025

Source: International Energy Agency World Energy Outlook

2013

2030

2035

Photo: ConocoPhillips - Surmont

Two Methods of Oil Sands Recovery

Drilling: 80% of reserves

Schematic: Devon - Jackfish

Mining: 20% of reserves

Global Crude Oil Reserves by Country

World Oil Reserves
300

298
266

250

Open to
Private
Sector

Restricted
(81%)

173

200

Oil Sands
53%
Other
47%

157
140

100

92

80
48

50

37

32

30

25

24

China

102

Qatar

150

Kazakhstan

billion barrels

Open to
Private Sector

Source: Oil & Gas Journal Dec. 2013 & AER

United States

Nigeria

Libya

Russia

Abu Dhabi

Kuwait

Iraq

Iran

Canada

Saudi Arabia

Venezuela

Canadian Oil Sands (Bitumen and SCO) & Conventional

Production

2012 Canada and U.S. Demand for Crude Oil by Source

Thousand Barrels per Day

Access to Markets Pipeline Expansions in Development

WCSB Takeaway vs Supply Forecast

Crude Oil Rail Exports

Western Canada vs. North Dakota

Opportunities:
Relatively quick
Flexibility
Less diluent
Use in both
directions
Challenges:
Recent safety
Higher costs
Limited loading
and tank car
availability
Source: Peters & Co. Limited = Sept 2013

10

Oil Sands
Environmental
Performance

11

Joint Oil Sands Monitoring

Increased sites (87 to 172)
More substances
Greater sensitivity
Broader geography
Standard methodology
Publicly available data
$50 million per year
In addition to required
project monitoring

will be one of the most progressive and comprehensive environmental

monitoring programs of any industrially-developed region in the world.
12

Greenhouse Gas Emissions

Global CO2 Emissions

Canadas 2%
Buildings
12%

USA
18%
European Union
12%
Japan
4%
China
26%

Agriculture
10%

Emission Intensive &

Trade Exposed
Industries
11%

Waste & Others

7%

Canada
2%

Oil Sands
7.8%

India
6%
Other Upstream
11%

Australia/New
Zealand
1%

Other
26%

Russian
Federation
5%

Transportation
24%

Electricity
13%

Other Oil & Gas

4%

GHG emissions from oil sands:

Sources:
1. United Nations Statistics Division (2010 Data)
2. Environment Canada (2011 Data)
Note: Global split based on CO2 emissions, Canadas split based on
GHG emissions

Accounted for 0.14% of global GHG

emissions
7.8% of Canadas GHG emissions
26% reduction in intensity from 1990

Full-cycle GHG Emissions

Oil Sands & U.S. Refined Crudes
U.S. Barrel Refined in
the U.S. (2005)
Venezuela - Petrozuata
US -Kern River
Cdn Oil Sands: Mining SCO
Nigeria - Bonny Light
Canadian Oil Sands: SAGD Dilbit
Iraq-Basra Light

+5%

Cdn Oil Sands: Low SOR SAGD Dilbit

US - Mars
Venezuela Bachaquero
Mexico - Maya

+2%

Cdn Oil Sands: Mining Dilbit (PFT)

Iraq - Kirkuk Blend
US Barrel Refined in the U.S. (2005)

Well-to-tank

Saudi Arabia - Arab Light

Refined product
Combustion

Brazil - Tupi
North Sea - Forties

0
Source: IHSCERA Oil Sands Dialogue Getting the Numbers Right 2012

100

200
300
400
kgCO2e per barrel of refined product

500

600

Tailings Management

Alberta law requires all land disturbed by oil sands operations be reclaimed,
including tailings ponds
Oil sands operators are working to meet the thresholds set out by the AER
Industry and is working to accelerate the reclamation of the resulting tailings
deposits so that they can be incorporated into the final reclaimed landscape.

Suncor: TRO

Suncor: Pond 1 Reclamation

CNRL: CO2 addition

Syncrude: $1.9 Billion Tailings Centrifuge plant

15

Canada Oil Sands Innovation Alliance (COSIA)

Accelerating the pace of improvement in environmental performance

in Canadas oil sands through collaborative action and innovation

COSIA

Focus Areas: GHG, Land, Water, Tailings

Shared 560 technologies that cost $900
million to develop
185 projects underway with a cost of
over $500 million

Tailings

Filter press project

Accelerated Dewatering
Cross Flow Filtration
Filter Press Project
Tailings Centrifuge

Greenhouse Gases

The Algae Project

Gas-Turbine Once Through Steam
Generator: Co-Generation
Waste Heat Recovery

Waste Heat Recovery

Land reclamation

Caribou Habitat Restoration

Oil Sands Vegetation Cooperative
Topsoil Reconstruction

16

Oil Sands Vegetation Cooperative

Transportation Safety
Pipeline
Integrity & operations

Rail
Safety & response

Marine
Prevention, response and recovery tankers/ports

17

Industry Capital Spending

Cdn $billions
Oil & Gas Investment Spending:
Northern Canada
2012 2013E 2014E
$0.1 $0.5
$0.7

2012: $67 billion

2013: $69 billion (estimate)
2014: $71 billion (estimate)

Oil Sands
2012 2013E 2014E
$27
$27
$29

Western Canada
2012 2013E 2014E
$37
$39
$38

Note: Excludes spending on mergers & acquisitions

18

East Coast Offshore

2012 2013E 2014E
$2.4 $3.0
$3.5

The Oil and Natural Gas Industry

A Key Driving Force in the Canadian Economy
Industry will invest $71 billion in Canada in 2014
Largest single private sector investor in Canada

Payments to governments average about $18 billion per year

Oil and gas accounts for 20% of value on Toronto Stock Exchange
Oil and Gas accounts for close to 18% of exports
Industry employs more than 550,000 in Canada (direct & indirect).

Upstream Oil
& Gas

Auto
Manufacturing
Forestry
& Logging

19

Wheat &
Barley

Uranium

Suppliers across Canada

Canadas Energy Development

Energy

Economy

21

Environment