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View Report - SocialFunds.com

View Report - SocialFunds.com

We know that oil sands

We know that oil sands mining disturbs the land—but not forever. Good land management practices are key to Suncor’s overall vision of responsible development. Our goal is to do this work better and faster. our performance Reclaimed overburden storage area at Suncor’s oil sands facility. Both absolute GHG emissions and emissions intensity decreased in 2008 as compared to previous years. These decreases, however, did not contribute to improved performance. They are the result of extended outages of one of our oil sands hydrotreating units, which resulted in a larger amount of sour crude oil product being produced and thus fewer GHGs emitted. As the result of unexpected shutdowns in 2008, average production rates were also well below Suncor’s existing capacity. The closer our plant runs to capacity, the more efficient it becomes as economies of scale take effect. Even at lower production rates, much of the plant infrastructure must keep running, drawing energy without producing as much finished product— so per-barrel GHG emission rates go up. By the first quarter of 2009, Suncor’s renewed focus on operational excellence resulted in improved reliability and productivity. We plan to sustain this momentum, which should allow us to resume making emission intensity improvements. Suncor’s decision in January 2009 to delay our major growth projects until economic conditions improve means our absolute GHG emissions will not grow as quickly as previously expected. Suncor Energy GHG Emissions Actual and Estimates (1990 – 2013) (1)(2)(3)(4)(5) thousand tonnes CO 2 equivalents (CO 2 e) 07 08 13 Business as usual (BAU) CO 2 e emissions (thousand tonnes CO 2 e) 4 832 10 737 18 585 14 740 20 828 19 355 18 878 23 480 22 666 24 377 22 826 23 469 Actual and estimated CO 2 e emissions (thousand tonnes CO 2 e) 4 832 7 783 10 627 9 873 11 508 11 766 11 115 13 889 13 639 14 026 13 724 13 531 Suncor Energy GHG Emission Intensity Actual and Estimates (1990 – 2012) (1)(2)(3)(4)(5) tonnes CO 2 e/cubic metres of oil equivalent (m 3 OE) 07 08 13 Actual and estimated CO 2 e emission intensity (tonnes CO 2 e/m 3 OE) 0.570 0.402 0.408 0.441 0.432 0.441 0.423 0.458 0.444 0.427 0.426 0.412 BAU CO 2 e emission intensity (tonnes CO 2 e/m 3 OE) 0.570 0.554 0.713 0.658 0.782 0.725 0.719 0.775 0.738 0.741 0.709 0.714 (1) Estimates are based on current production forecasts and methodologies. The tables contain forward-looking estimates and users of this information are cautioned that the actual GHG emissions and emission intensity may vary from the estimates contained in the table. (2) Data from 1990 to 2000 does not include Suncor’s U.S. operations. (3) Data includes direct and indirect CO 2 e emissions. (4) Data and estimates for 2006 onward include the St Clair Ethanol Plant. (5) Data and estimates have changed from last year's report due to Oil Sands methodology changes that reflect the inclusion of biomass, a methodology change in the calculation of fugitive emissions using LDAR data, and revisions to emission factors based upon AENV's request. These changes are also consistent with the methodology used for SGER Bill 3 reporting. Definitions: Direct GHG emissions: Emissions from sources that are owned or controlled by the reporting company. Indirect GHG emissions: Emissions that are a consequence of the operations of the reporting company, but occur at sources owned or controlled by another company (e.g. purchased electricity). Absolute (total) emissions: The total GHG emissions (direct and indirect emissions) of a facility or reporting company. Emission intensity: Ratios that express GHG impact per unit of physical activity or unit of economic value (e.g. tonnes of CO 2 e emissions per unit of gross production). Suncor Energy Inc. 10 climate change

Suncor is taking the lead in progressive water management. We are minimizing the amount of water required for our operations, recycling it where possible and ensuring the quality of discharged water meets regulatory requirements. Natural wetlands monitoring at Suncor’s oil sands facility. Looking Ahead We remain committed to our seven-point climate change action plan. This plan calls on Suncor to manage our own emissions, develop renewable sources of energy, invest in environmental and economic research, use domestic and international offsets, collaborate on policy development, educate employees and the public, and measure and report our progress. We are proceeding on all those fronts. At the same time, the global economic crisis that emerged in the fall of 2008, concurrent with a significant drop in commodity prices, forced Suncor to review and reassess its spending priorities. Some difficult decisions had to be made. For example, we decided to delay construction of a proposed $120 million expansion of our ethanol production plant near Sarnia, Ontario. We also opted not to proceed at this time with a proposed joint venture with Lignol Innovations to construct an $80 million USD cellulosic ethanol plant in Colorado. All the same, Suncor remains committed to pursuing a “parallel path” for energy development—building today’s oil sands industry while also helping to bring along new sources of energy for tomorrow at a pace and scale that reflects our financial capacity. Similarly, Suncor is moving on several fronts to advance new technologies to reduce GHG emissions. We continue to work with the Integrated CO 2 Network (ICO 2 N) on industry efforts to improve the commercial viability of carbon capture and storage (CCS) technology. We are also a long-term partner in the Carbon Capture Project, where some of the world’s leading energy companies and various governments collaborate on research to help make CCS a reality. Suncor continues to invest in other technologies aimed at conserving energy and reducing GHG emissions. These include proposals to use gasification technology to turn petroleum coke into synthetic gas and investigate the potential for harnessing deep geothermal energy. Suncor welcomes emerging efforts in Canada and the United States to develop more comprehensive energy and climate change policies. When it comes to climate change regulations, we continue to press for clarity and certainty (i.e. our investors want to know what the rules are up front), fairness and competitiveness (i.e. no one industry or region should be unfairly targeted or punished), and harmonization across jurisdictions to avoid overlap and inefficiencies. Suncor sees emissions trading and other carbon-pricing mechanisms as useful tools for achieving low cost GHG emission reductions. But we also believe that, for climate change policy to be effective, it must accelerate the pace of development and deployment of new technologies that will transform how we produce and use energy. Cap and trade policies will not accomplish this. We need complementary policies and measures that will attract additional capital over the near to long term. Suncor is closely monitoring initiatives by California and others to establish low carbon fuel standards, noting there have been challenges with lifecycle assessment methodology and potential overlaps with other climate change policies such as renewable fuel standards. We will continue to monitor policy in this area and participate in studies aimed at determining the lifecycle GHG emissions from oil sands and other fuel sources. The fact that 75 to 80 percent of lifecycle GHG emissions come from combustion of gasoline or diesel, underscores the need for energy consumers as well as energy producers to be represented in policy making. On the web: A question and answer with Suncor’s Gord Lambert, vice president of sustainable development, on public policy challenges, renewable energy and the “dirty oil” campaign; and features on Suncor’s response to California’s low carbon fuel standard and carbon capture and storage initiatives can be found in the “Climate Change” section. climate change 11 2009 summary report on sustainability