UK-Canada CCS Mission August 20, 2012

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About ICO2N

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About ICO2N

Wide range of industry participants Air Products BP Canada Canadian Natural Resources Ltd. ConocoPhillips Enbridge Husky Energy TransAlta Shell Statoil Suncor Energy Syncrude Total

CCS policy leadership in Canada • Source of thoughtful CCS knowledge for 7 years

Grounded analysis • Leading CCS technology analysis • Integrated CCS economics

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Leading CCS Technology Analysis • Alberta CO2 Purity Project • Net GHG Impact of Enhanced Oil Recovery Integrated CCS Economics • Model of integrated CCS infrastructure • Consistency in cost analysis • Cost comparison of CCS to other GHG reduction technologies

Voice for CCS in Canada • Leadership on CCS Development Council and Albertan/Canadian

CCS Task Force • Role in Regulatory Framework Assessment • Voice of CCS in media and public

Forefront of CCS in Canada

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Canadian Context

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A Strategic Investment for Canada

• A critical component of Canada’s GHG reduction strategy

• A critical component of Canada’s energy strategy; for both coal and oil

• A ‘Made in Canada’ solution that supports a “Clean Energy” approach

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Provincial Emissions

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CCS Vision for Western Canada

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Canada is a World Leader

Proven Experience • Cenovus EOR/Storage project in Weyburn – operating since 2000

Financial Support for Large Scale Demonstration

• ~$3.5 billion for CCS through various funding programs to support commercial scale projects:

• 3 in Alberta in the 2015 time frame • 1 in Saskatchewan by 2014

• R&D funding across Canada for CCS technology development

Regulatory Support • Comprehensive CCS regulation developed through multi-stakeholder

approach – Alberta Regulatory Framework Assessment • Clean Energy Dialogue with the United States

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Only Certain Industries Can Pursue CCS

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CCS in the Oil Sands

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Funding Gap

Provincial and Federal leadership is needed during the transition period

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1. Ensure the initial projects move forward

2. Policy and incentives for the next wave of projects

3. Develop a strong EOR industry to help defray costs

4. Transition infrastructure towards an integrated CCS system

5. Put in place robust CCS regulations and policy

6. Advance necessary studies and research

7. Public engagement

CCS must be considered a long-term priority

Steps to Large-Scale CCS Deployment

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Thank You

www.ico2n.com Contact: Kali Taylor ktaylor@ico2n.com 403-296-6376 twitter: @ICO2N

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Supplementary Material

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CO2 Capture and Storage Overview

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Long-Term Vision of CCS Across Canada

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Canada’s CO2 Reduction Target

Absolute reduction of 17% below 2005 emissions

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Canada’s 2005 Emissions

747 million tonnes of CO2

25.3% above 1990 total of 596Mt

32.7% above the Kyoto target

Emissions associated with oil and gas exports to US were 73 Mt

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Reaching Our Target

17% equals 127 million tonnes of CO2

(and that’s with no growth!)

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CCS Economics are Challenging

Costs of CCS system components are variable and site specific. Key drivers are:

• Pipeline – Distance of transport and pipeline size

• Capture – Facility specifics and chosen capture technology

• EOR – Productivity of EOR field

• Compliance – Strictness of government regulations

• Tax Savings – Individual corporate finances and economic loss associated with respective CCS operation

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The Challenge: Cost of Capture

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CCS Challenges in the Oil Sands

CCS Economics • Capture for oil sands are relatively high cost

Demonstration of Technology • Imperative that proposed projects move forward so technological

improvement can occur • Incentives for a new wave of projects need to be encouraged

Public Engagement

• Needs to continue to be a priority to ensure public is confident with the science and technology

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CCS Opportunities in the Oil Sands

CCS is technically feasible • CCS is an accumulation of known technologies • Research underway worldwide

CCS may be driven by factors other than carbon prices • Low carbon fuel standards at market • Shareholder activism and/or corporate value structure • Environment Canada regulation in 2011/12 timeframe

CCS is a risk mitigation technology for companies

CCS is the biggest tool in the toolbox

• Large volume potential • Industry and governments understand this

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Canada’s CCS Projects

Project Location Project Type Volume

1. Weyburn-Midale Enhanced Oil Recovery Project

Weyburn, Saskatchewan

• CO2 from a Gasification facility in North Dakota transported via pipeline

• Home of the IEA GHG Monitoring Research Program

• 2.2 Mt/yr • EOR

2. Shell Quest Edmonton, Alberta • Bitumen Upgrader • Post- combustion amine solvent

• 1 Mt/yr • EOR & Sequestration

3. Enhance Pipeline

Industrial Heartland, Alberta (3 facilities)

• Large-scale CO2 pipeline • CO2 from fertilizer plant &

bitumen upgrader

• 1.7 Mt/yr initially • Pipeline for up to 14Mt • EOR

4. Swan Hills Synfuels

White Court, Alberta

• In-situ coal gasification • (syngass for 300MW of co-

generation)

• 1.3 Mt/yr • EOR

5. SaskPower Boundary Dam

Estevan, Saskatchewn

• Coal-fired electricity power plant • Post Combustion Amine

• 1 Mt/yr • EOR

6. Spectra Energy Fort Nelson, British Columbia • Capture at a natural gas plant

• 1 Mt/yr • EOR & Sequestration

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Quest Project

• Project Lead: Shell Canada

• Project Partners: Athabasca Oil Sands Project Shell Canada (60%) Chevron Canada Ltd (205) Marathon Oil Sands L.P (20%)

• Expected Start Date: 2015

• Location: Scotford Upgrader near Edmonton

• CO2 source: Bitumen Uprgrader

• Capture Process: Amine Solvent will capture CO2 from hydrogen production

• Volumes: 1 MT CO2/y for EOR and Sequestration

• Public Funding: Canada $120 Million & Alberta $750 Million

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Alberta Carbon Trunk Line

• Project Lead: Enhance Energy

• Project Partners: North West Upgrader, Agrium Fertilizer

• Expected Start Date: 2012

• Location: 3 major facilities

• Compressor facility at Agrium Complex- South of Redwater

• A compression facility at NWU site

• Pump station west of Bruderhiem

• CO2 sources: Bitumen Upgrader and Fertilizer plant

• Volumes: 1.7 MT CO2/y for EOR

• Public Funding: Canada $63 Million & Alberta $495 Million

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Swan Hills Synfuels ISGC

• Project Lead: Swan Hills Synfuels

• Project Partners: To be determined

• Expected Start Date: 2015

• Location: White Court, Alberta

• CO2 source: In situ coal gasification from unmineable coal seams

• Volumes: 1.3 MT CO2/y for EOR and syn-gas for 300 MW of co-generation

• Public Funding: Alberta $285 Million

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Boundary Dam

• Project Lead: Sask Power

• Project Partners: Many

• Expected Start Date: 2015

• Location: Estevan, Saskatchewn

• CO2 source: Retro Fit of 100 MW Coal-fired electricity power plant

• Capture Process: Post Combustion - Amine

• Volumes: 1 MT CO2/y EOR

• Public Funding: Canada $250 Million

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Spectra Energy

• Project Lead: Spectra Energy

• Project Partners: Many

• Expected Start Date: 2016

• Location: Fort Nelson, British Columbia

• CO2 source: Natural gas

• Capture Process: Capture at a Natural Gas Plant

• Volumes: 1 MT CO2/y for EOR and Sequestration

• Public Funding: British Columbia $3.4 Million

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Weyburn-Midale

• Project Lead: Cenovus, Apache

• Project Partners: Dakota Gasification Company (CO2 supplier), Petroleum Technology Research Center, IEAGHG (monitoring research program), others

• Start Date: 2000

• Location: Weyburn, Saskatchewan

• CO2 source: Gasification facility

• Capture Process: Pre-combustion capture

• Volumes: 2.2 MT CO2/y for EOR

• Public Funding: USA $3M, Canada $2.2M (for the IEA GHG monitoring project)