Copyright SHELL CANADA ENERGY 1

QUEST Carbon Capture & Storage Project Alberta, Canada

Presentation to GCCSI Members Meeting

Melbourne, Australia

October 2011

Tim Bertels, Manager Global CCS Portfolio

Shell International E&P, The Hague.

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SHELL’S RESPONSE TO THE CO2 CHALLENGE

1. Natural Gas 2. Biofuels 3. Carbon Capture and Storage (CCS) 4. Energy efficiency

Perdido, USA Biofuels, Brazil (Sugar cane for proposed Cosan joint venture)

SEPC, Singapore (part of the global energy efficiency programme)

Carbon Capture Research, Mongstad, Norway

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Demonstration projects, joint industry partnerships

Industrial scale projects in construction

Industrial scale projects planned

Quest

Weyburn Midale

Westcarb

Otway

Mongstad

Gorgon

DEVELOPING CCS TECHNOLOGIES FOR THE FUTURE

Peterhead

Longannet

Shell involvement in CCS Projects;

Aberthaw

Boundary Dam

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CCS IN CANADA/ALBERTA

A significant part of GHG mitigation plans for both Canada and Alberta

Technically possible today

Builds on proven components

CCS needs…

Government leadership and financial support

Public awareness and acceptance

Demonstration projects

Canada & Alberta providing partial funding for CCS demonstration projects

Source: NRTEE ‘Achieving 2050: A Carbon Pricing Policy for Canada”, 2009

GHG emissions profile and mitigation options – Canada

Source: Alberta 2008 Climate Change Strategy

GHG emissions profile and mitigation options – Alberta

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QUEST LOCATION MAP

ALBERTA

ALBERTA INDUSTRIAL HEARTLAND

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QUEST CCS PROJECT - OVERVIEW

Quest CCS Project - fully integrated CCS (capture, transport, storage & MMV)

JV among Shell (60%); Chevron (20%); and Marathon (20%)

Improves GHG performance of Oil Sands operations

Capture at the Scotford Upgrader from 3 Hydrogen Units

Capacity to capture over one million tonnes of CO2 per year or up to 35% of Scotford Upgrader direct emissions

Equivalent of taking 175,000 vehicles off the road

CO2 transported by pipeline

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CO2 CAPTURE SCOPE

Up to 1.2 million tonne CO2 per year nameplate from 3 steam methane reformers, 1.08 million tonne CO2 per year on-stream

Activated amine (Shell ADIPX) & multistage compression with dehydration

CO2 pipeline operating in the dense phase

CO2 Capture

Feed Gas

from HMU

Amine

Regeneration

CO2

Compression

Dehydration

CO2 to

Pipeline

Treated Gas

to HMU

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QUEST INTEGRATED CCS PROJECT

CO2 Source Base Facility & Expansion-1

CO2 Capture Quest Capture Facilities

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SALT SEALS

Intermediate

Casing

Main Injection

Casing

Cement

Surface

Casing

Tubing

SHALE SEALS

TARGET FORMATION

Packer

Assembly

Perforations

allow CO2 to

penetrate the

formation

QUEST PROPOSED PIPELINE ROUTE

The Quest CCS Project is located in the Industrial Heartland Region, approximately 5 km northeast of Fort Saskatchewan

The pipeline will travel up to 90 km north of the Scotford Upgrader to the chosen injection locations

North Saskatchewan River crossing drilled

Line break shut off valves at 15 km

Line size up to 12 inches in diameter

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QUEST CO2 STORAGE OPTIONS

Storage Option Quest premised on Saline Aquifer rather than EOR or depleted field

Basal Cambrian Sands (BCS) selected

Primary storage zone is a deep saline aquifer formation called the Basal Cambrian Sand (BCS) located approximately 2300 metres deep

Multiple caprock and salt seal layers

The BCS is well below hydrocarbon bearing formations and potable water zones in the region

Relatively few wells drilled into the BCS

Significant storage capacity …

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Wells and Drilling

FDP expected to have 3 – 7 wells

Conventional drilling methods

Multiple steel casings for wells

Measurement, Monitoring & Verification (MMV)

Subsurface and surface monitoring

Over 50 technologies considered:

Well monitoring

Geophysical monitoring

Geochemical monitoring

Surface monitoring

SALT SEALS

Intermediat

e Casing

Main

Injection

Casing

Cement

Surface

Casing

Tubing

SHALE SEALS

TARGET FORMATION

Packer

Assembly

Perforations

allow CO2 to

penetrate the

formation

QUEST CO2 INJECTION & MONITORING

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QUEST CCS PROJECT SCHEDULE

Stakeholder Engagement Consultation with landowners and municipalities

Community Open Houses and workshops

Public outreach and education

Integrated planning and decision based process

Complete Field Development Plan

Advance front end definition – Basic Design Engineering Package

Progress Project Definition

Quest 2011 Development Program

Filed

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QUEST CCS PROJECT – EARLY LEARNING

Front-end loading Engineering, Exploration, Appraisal not Exploration, Appraisal, Engineering

Capture Cost efficiency key e.g. design class

Steam & power integration key value levers

Storage Appraisal: eliminating uncertainty without compromising reservoir integrity

Significant modelling capability required, hydrogeology understanding vital

Operations Process integration challenges, especially transient conditions

Dispersion modelling

MMV Adaptive, many technologies available, value of information is the determinant

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WHAT IS NEEDED TO PROGRESS CCS GLOBALLY

Support for CCS from key stakeholders

Sense of urgency to deliver, support to frontier CCS projects

Global knowledge sharing to enable best practice

Engineering at scale to deliver cost reduction

Infrastructure planning and reservoir characterisation to reduce costs

Clear signal (from the regulator) now of the CCS business model 2020+