1. Saskatchewan Industry and Resources Regulatory Update SPILL CO-OP Petroleum Development Branch September 19, 2007

2. www.ir.gov.sk.ca Total number of spills: 876 –Reportable spills: 686 –Non-reportable spills: 190 Breakdown of number of spills by substances: –Crude oil: 272 –Salt water: 269 –Emulsions: 298 –Natural Gas: 13 –Condensate: 1 –Refined Chemicals: 15 –Others: 8 Data as of December 31, 2006. This information is subject to update. 2006 Spill Statistics

3. www.ir.gov.sk.ca Breakdown by volume of total spilled fluid: –Crude oil: 4,664 m 3 –Salt water: 12,142 m 3 –Condensate: 5.7 m 3 –Refined Chemicals: 55 m 3 Recovered volume: –Crude oil: 2552 m 3 –Salt water: 7872 m 3 –Condensate: 5.6 m 3 –Refined Chemicals: 6.1 m 3 2006 Spill Statistics

4. www.ir.gov.sk.ca Facilities: 207 Equip Failure: 118 Human Error: 36 Corrosion: 31 Lightening: 4 Fire: 6 Miscellaneous: 11 Cattle: 1 Wells: 359 Equip Failure: 173 Human Error: 129 Corrosion: 30 Blowout: 5 Vandalism: 4 Fire: 2 Lightening: 1 Miscellaneous: 13 Cattle: 2 Pipelines/Flowlines: 222 Mech. Failure: 64 Human Error: 8 Corrosion: 120 Miscellaneous: 8 Transportation Vehicle Related Spills and Misc.: 88 Causes Of Spill 2006

5. www.ir.gov.sk.ca Annual Spill Numbers Please note 2006 spill numbers are estimates and has not been yet finalized.

6. www.ir.gov.sk.ca A total of 185 spills has been reported from Area 1 as of September 2007.

7. www.ir.gov.sk.ca A total of 105 spills has been reported from Area 2 as of September 2007.

8. www.ir.gov.sk.ca A total of 72 spills has been reported from Area 3 as of September 2007.

9. www.ir.gov.sk.ca A total of 135 spills has been reported from Area 4 as of September 2007.

10. www.ir.gov.sk.ca The Oil and Gas Conservation Amendment Act, 2007 receives Royal Assent on March 21, 2007. The Oil and Gas Conservation Amendment Regulations, 2007 passed on June 19, 2007. The amendments supports changes to the spill management program. Legislation and Regulations

11. www.ir.gov.sk.ca New Spill Management Regulations Reportable “spill materials” list is being expanded to include:: –crude oil –salt water –condensate –natural gas liquids –refined chemicals spilled at a SIR licensed site –sour gas –any combination of the above materials

12. www.ir.gov.sk.ca Immediate Reporting Report immediately when: –A fire; –A blow out; –Any volume of salt water, crude oil or condensate released outside the lease boundary (includes release during transportation); –Break, contact damage or leak from a pipeline or flowline, except where notification is made pursuant to The Pipelines Regulations, 2000;

13. www.ir.gov.sk.ca –On lease spills exceeding the following volumes (includes spills contained within a dyke): Salt water equal to or greater than (≥) 2.0 m3 Crude oil spill ≥ 2.0 m3 Condensate spill ≥ 2.0 m3 Refined chemical spill ≥ 0.5 m3 Sour gas ≥ 1000ppm (measured at the edge of the lease boundary) Immediate Reporting (cont’d)

14. www.ir.gov.sk.ca Spill Report And Reclamation Operator must submit a written report within 90 days of the spill: –the exact location of the spill, including: –an estimate of the volume released and recovered; –the time the spill or release occurred; –a description of the circumstances leading to the spill;

15. www.ir.gov.sk.ca Operator must submit a written report within 90 days of the spill (cont’d): –a discussion of the spill containment and recovery procedures; –a discussion of steps to be taken to prevent similar future spills; and –any other information that the minister may require. Spill Report And Reclamation (cont’d)

16. www.ir.gov.sk.ca An operator shall: –reclaim the area impacted by the spill to standards specified by the minister; and –submit a reclamation report to the department in a format specified by the minister. Spill Report And Reclamation (cont’d)

17. www.ir.gov.sk.ca Upon completion of abandonment of a well or facility the licensee shall: –conduct an environmental site assessment in a manner specified by the minister; –decommission the site to standards specified by the minister; and –reclaim the site to standards specified by the minister. Reclamation Requirements

18. www.ir.gov.sk.ca Within six months of the completion of the activities noted, the licensee or the operator shall submit to the department a reclamation report and any other information required by the department in a format specified by the minister. Reclamation Requirements (cont’d)

19. www.ir.gov.sk.ca Upon meeting the above requirements to the satisfaction of the minister, the department shall issue an acknowledgement of reclamation, when licensee or the operator submits: –a written request for acknowledgement of reclamation on a form specified by the minister; –a reclamation report specified in subsection (3), that meets the satisfaction of the minister; and –any other information required by the minister. Reclamation Requirements (cont’d)

20. www.ir.gov.sk.ca No licensee or operator is absolved of its past, present or future environmental liability associated with the site even when an acknowledgement of reclamation is issued for the site. The minister may specify any conditions or terms in the acknowledgement of reclamation or cancel the acknowledgement of reclamation at anytime. Reclamation Requirements (cont’d)

21. www.ir.gov.sk.ca Contact Swift Current Field Office: 306-778-8252 Todd H. Han: than@ir.gov.sk.cathan@ir.gov.sk.ca Debby Westerman: dwesterman@ir.gov.sk.cadwesterman@ir.gov.sk.ca SIR Home Webpage: www.ir.gov.sk.ca