1. Cowichan Lake and River status update Trend updates as of July 27, 2015

2. 2 Lake level down 65 cm(67% used) / 33% remains

3. 3 River Flow Holding at 5.5 cms since June 11

4. 2014 included 63 days with release at 4.5 cms 4

5. Crofton mill in 2015 using less than 1.6 cms of water from Cowichan River 5

6. Mill focus on water use has achieved 0ver 30% reduction in since 1999 6

7. Peak summer water use continuing to improve (lower) each year (2015 (May/June) 26% less peak flow than 2000) 7

8. In peak summer period year over year water use reduction of 5% and 10% for 2013/14 & 2014/15 Focus on water use reduction continues 8

9. Coming 2 weeks – no rain expected 9

10. Key Initiatives at mill – reduce water demand Maximize application of salt water for cooling effluent – avoid use of fresh water for this purpose Rebuilt entire foreshore heat exchanger system in recent 2 years and optimization continues. Modified temperature control strategy: prevent use of fresh water for cooling effluent until high- high alarm for effluent temperature at 107 F Improved visibility of use of sea and fresh water to ensure issues are promptly recognized and resolved – recently the intake screen for sea water has been plugging off rapidly – divers needed to clean weekly 10

11. Next Steps Continue to reduce water use at mill to ensure maximum flows in river below river pump house are sustained Reduce river flow at Lake Cowichan to 4.5 cms to prevent total loss of river flow prior to arrival of fall rains (minimize duration of impact to resident and spawning fish resources and to mill operations). Ensure flow below river pump house remains above 2.83 cms as is required by the license. 11

12. Longer Term: Increased storage in Lake Cowichan is needed Catalyst supports the need for a longer term secured water supply for all stakeholders. Catalyst supports the CVRD bid for grant money for raising the weir. Catalyst is committed to work with a larger stakeholder group to move forward. 12

13. In response to request for guidance from DFO, both a detailed description of in stream activities was provided by DFO and a response by Catalyst Paper has been provided to support that work Attachment 1 – DFO guidance to Catalyst Attachment 2 – Catalyst commitment to conduct the investigation to support 4.5 cms Next step is to, as instructed, gain support from flows committee for the work needed to allow a flow reduction down to 4.5 cms Flows committee meeting this afternoon 13