ALBERTA OIL SAND(S) DEPOSITS The four deposits, Athabasca, Peace River, Cold Lake and Wabasca, have total resource in place estimated at 1.7 trillion to 2.5 trillion barrels. The Athabasca Oil Sands deposit, Alberta’s largest and most accessible source of bitumen, contains more than one trillion barrels of bitumen over an area encompassing more than 30,000 square kilometers.

BITUMEN The molasses-like substance that comprises up to 18% of oil sands. Bitumen, in its raw state, is black, asphalt-like oil. It requires upgrading or blending to make it transportable by pipeline and usable by conventional refineries.

CARBON DIOXIDE (CO₂) A non-toxic gas produced from decaying materials, respiration of plant and animal life, and combustion of organic matter, including fossil fuels; carbon dioxide is the most common greenhouse gas produced by human activities.

COKERS Vessels in which bitumen is cracked into its fractions and from which coke is withdrawn in the process of converting bitumen to upgraded crude oil.

CONVENTIONAL OIL Petroleum found in liquid form, flowing naturally, or capable of being pumped without further processing or dilution.

DEBOTTLENECK Debottlenecking systematically removes plant capacity limitations through modifications of existing facilities and/or addition of capital facilities. Debottlenecking commonly provides a 10-20% capacity improvement versus a major capital intensive expansion.

DIESEL CETANE COUNT A quality specification important in the production of diesel fuels.

DRAGLINE A large machine that digs oil sand from the mine pit and piles it into windrows.

EXTRACTION The process of separating bitumen from oil sand.

FEEDSTOCKS Raw material supplied to refinery, oil sands upgrader, or petrochemical plant.

FLUE GAS SCRUBBER / DESULPHURIZER Equipment that removes sulphur dioxide and other emissions.

FLUID COKING A major part of the upgrading process whereby high temperatures in a coker break down the complex bitumen molecules, rejects carbon and causes bitumen molecules to reformulate into lighter fractions that become  the main ingredients in upgraded crude oil.

GREENHOUSE GASES Any of various gases that contribute to the greenhouse effect.

LINE-OUT The process of optimizing an operational unit or facility to reach its design capacity.

OIL SAND(S) A composition of sand, bitumen, mineral rich clays and water.

OIL SAND(S) LEASE A long-term agreement with the provincial government which permits the leaseholder to extract bitumen, other metals and minerals contained in the oil sands in the specified lease area.

ORE GRADE The percentage of bitumen by weight in the oil sands.

OVERBURDEN A mining term related to the thickness of material above oil sands deposits.

STRIP RATIO The ratio of waste (overburden material that covers mineable ore) to ore; used to define the quality of an oil sands ore body.

SULPHUR DIOXIDE (SO₂) A compound of sulphur and oxygen produced by burning sulphur.

SYNBIT Typically, a synbit blend is a ~50/50 mix of bitumen and synthetic crude oil.

SYNCRUDE 21 A multi-staged expansion plan Syncrude embarked in 1997, which is anticipated to increase productive capacity to over 500,000 barrels per day.

SYNCRUDE™ SWEET BLEND (SSB) A 100% upgraded, high-quality product with 31° to 33° API, low sulphur (0.1% to 0.2%), low residuals and excellent low-temperature pour qualities.

SYNCRUDE™ SWEET PREMIUM (SSP) A new product that is expected to be introduced in 2007; the quality of the distillate cuts will improve with lower sulphur and nitrogen levels as well as higher diesel cetane numbers and kerosene smoke points.

SYNTHETIC CRUDE OIL A high-quality product resulting from the mining, extraction and upgrading of thick, tar-like bitumen.

TAILINGS A combination of water, sand, silt and fine clay particles that is a by-product of removing bitumen from oil sand.

TOTAL VOLUME TO BITUMEN IN PLACE (TV/BIP) The total amount of ore plus overburden volume to total bitumen in place.

TURNAROUND A regular event essential for good maintenance of the mining, producing and upgrading facilities. A turnaround may reduce production but does not usually halt it entirely as the various operating units are duplicated.

UPGRADING The conversion of heavy bitumen into a lighter crude oil by increasing the ratio of hydrogen to carbon, either by removing carbon (coking) or adding hydrogen (hydroprocessing).

Ratios:

Netback Net realized selling price, after hedging, less operating costs and Crown royalties.

Net debt to cash from operating activities Net debt divided by cash from operating activities.

Net debt to total capitalization Net debt divided by net debt plus Unitholders’ equity.

Return on average Unitholders’ equity Net income divided by average Unitholders’ equity.

Return on average productive capital employed Net income before net interest expense, future income tax, and foreign exchange gains/losses divided by average productive capital employed, which excludes major expansion projects not yet in use.

Abbreviations:

American Petroleum Institute specific gravity: API

barrel(s): bbl, bbls

barrel(s)/day: bbl/d, bbls/d

millions of barrels: MMbbls

carbon dioxide: CO₂

gigajoule GJ

sulphur dioxide: SO₂

Syncrude Sweet Blend: SSB

Syncrude Sweet Premium: SSP

West Texas Intermediate: WTI