ADVISORY - in the interest of providing Unitholders and potential investors of Canadian Oil Sands Trust (the “Trust” or “Canadian Oil Sands”) with information regarding the Trust, including management’s assessment of the Trust’s future production and cost estimates, plans and operations, certain statements throughout this annual report contain “forward-looking statements” under applicable securities law. Forward-looking statements in this annual report include, but are not limited to, statements with respect to: the expected improvement in energy efficiency once Stage 3 is lined-out, the expected benefits from Stage 3 and the productive capacity that can be achieved in the future; the expected timing to fix the design issues around the hyrdrogen plant and the timing to produce SSP; the expected growth opportunities that the Trust has through its expansion of the current interest in Syncrude or through external opportunities; the extent and value of Syncrude’s reserves and resources; the quality of Syncrude’s leases and bitumen in place in those leases; the ability to improve the base operations at Syncrude, including without limitation the expected benefits to be realized from the Management Services Agreement between Syncrude Canada Ltd. and Imperial Oil Resources; future increases if any in distributions; the ability to mitigate and prevent operational risks such as dyke failures, explosions in upgrading units or other similar events; the anticipated impact of proposed changes in federal tax legislation on income trusts; the impact of labour shortages and pipeline constraints on the Trust and its realized selling price for crude oil; the need for future hedging; the return anticipated from sales of Syncrude Sweet Premium; the expected price for crude oil and natural gas in 2007; the expected reduction in sulphur emissions from the Syncrude Emissions Reduction project; the actual taxes paid in the future by Canadian Oil Sands; the expected production level at Syncrude in 2007; the expected timing and associated production impact of coker and other unit turnarounds; the expected revenues, operating costs and cash from operating activities for 2007; the anticipated impact that certain factors such as natural gas and oil prices, foreign exchange and operating costs have on the Trust’s cash from operating activities and net income; and the expected capital expenditures in 2007 and beyond. You are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur. Although the Trust believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Some of the risks and other factors which could cause results to differ materially from those expressed in the forward-looking statements contained in this annual report include, but are not limited to: labour shortages and the productivity achieved from labour in the Fort McMurray area; the impact of technology on operations and processes and how new complex technology may not perform as expected; the supply and demand metrics for oil and natural gas; the impact of governmental or regulatory changes, general economic, business and market conditions; and such other risks and uncertainties described from time to time in the reports and filings made with securities regulatory authorities by the Trust, including those outlined in the management’s discussion and analysis in this annual report and the assumptions outlined in the guidance for 2007 being true. You are cautioned that the foregoing list of important factors is not exhaustive. Furthermore, the forward-looking statements contained in this annual report are made as of the date of this annual report and unless required by law, the Trust does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this annual report are expressly qualified by this cautionary statement.  Unless otherwise specified, all dollar amounts are expressed in Canadian dollars, all references to “dollars” or “$” are to Canadian dollars and all references to “US$” are to United States dollars.

NON-GAAP FINANCIAL MEASURES
In this annual report, we refer to net income before unrealized foreign exchange and future income taxes. This is a measurement that is not defined by Canadian generally accepted accounting principles (“GAAP”). The Trust also reports funds from operations, free cash flow and Unitholder distributions on both a total and per Unit basis as well as cash from operating activities per Unit, which are all measures that do not have any standardized meaning under Canadian GAAP. Funds from operations are calculated on the Trust’s consolidated statement of cash flows as cash from operating activities before changes in operating non-cash working capital. Free cash flow is calculated as cash from operating activities less capital expenditures and reclamation trust contributions in the period. The net income before unrealized foreign exchange and future income taxes and the Trust’s funds from operations and free cash flow may not be directly comparable to similar measures presented by other companies or trusts.