The Environment and the Oil Sands

As a major holder of oil sands leases in Alberta, Husky is committed to developing its bitumen resources responsibly and with best practices.

Husky's first oil sands project, Tucker, has provided valuable experience and insights. Tucker reflects Husky's strategy of mitigating possible impacts of its facilities on wildlife habitat. The pipelines from the well sites to the plant incorporate crossings for moose, deer and other wildlife, and remote-controlled imagery confirms that these crossings are being utilized.

An in-situ production method called Steam-Assisted Gravity Drainage (SAGD) is used at Tucker and will be used at Sunrise. In-situ drilling technology uses steam injection to heat and mobilize the bitumen, allowing it to be pumped to the surface more easily. The process does not require tailings ponds and reduces habitat disturbance.

Husky is building on its Tucker experience at Sunrise with a progressive reclamation strategy to reduce surface impacts. Under current plans, development will disturb less than five percent of the lease area and land reclamation will occur progressively throughout the life of the project.

Environmental protection and stewardship is a core value in the design, construction and operation of Husky's oil sands projects and includes:

• Constraints mapping: Identifying and mapping environmental sensitivities ("constraints") during development of the project designs. Constraints mapping allows for potential environmental impacts to be fully considered and minimized, and a plan for mitigating potential impact follows environmental best practices
• Monitoring and measures to protect wildlife and fish habitat
• Biodiversity identification and protection of fragile ecosystems during site construction and operations on undeveloped lands

Strategically placed wildlife crossings will be used at Sunrise to allow wildlife movement under or over pipelines.

Air Stewardship

Husky is committed to addressing greenhouse gas emissions across all of its operations. The Company works with industry, regulators and governments, to lead the development and adoption of new technologies that will improve energy efficiency and reduce emissions.

At the Sunrise Energy Project, specific control technologies in both process and in equipment will help reduce greenhouse gas emissions and improve air quality, through:

• Energy efficient designs to reduce steam oil ratios;
• Ultra-low nitrogen oxide (NOx) boiler technologies with flue gas recirculation that significantly reduce NOx emissions;
• Technologies for sulphur recovery will be adopted to reduce sulphur dioxide (SO₂) emissions;
• Recovering gas vapours from tanks and process vessels so that they could be used as fuel and do not enter the atmosphere;
• Emissions scrubbing for air pollution control; and
• No venting of produced gases or flaring facilities at the well pads.

Throughout the life of the project, Husky will participate in comprehensive air monitoring programs, both at the Sunrise project and regionally, while its Environmental Performance Reporting System (EPRS) will facilitate and make available the provision of accurate and environmental data.

Water Stewardship

Non-saline water use at Alberta's oil sands projects is regulated by the provincial government to minimize the use of fresh water.

The water required to process bitumen at Sunrise will not be sourced from surface lakes, rivers or streams. Water required for production will be sourced in part from the non-potable Basal McMurray aquifer below the McMurray bitumen formation and will be minimized by recycling more than 90 percent of the produced water.

Waste Management

At Sunrise, an integrated waste management team has been created to address waste issues associated with the planned 40-year-plus lifespan of the facility. Sunrise will have an on-site landfill, which is expected to greatly reduce transportation-related accident risks, emissions and costs.

Following the end of the landfill project, the land will be reclaimed to an equivalent land capability consistent with what existed prior to disturbance and in consideration of the land use of the area. For example, in forested areas, the land is normally reclaimed to a condition that will re-establish a forest ecosystem.

Public Consultation

Husky is committed to respectful, honest and transparent communication with stakeholders, and does so as part of its regulatory approvals and cooperation agreements with Aboriginal stakeholders. Consultation is carried out through numerous forums, including open houses, community events, newsletters and regular meetings with stakeholder groups and Aboriginal advisory committees.

At the Sunrise Energy Project, Husky has been engaging Aboriginal communities and other stakeholders since the early project planning stages. Project issues and information received from external stakeholders are recorded in detail and tracked. This provides for continuous collaboration with stakeholders and industry participants on development, regional infrastructure and other emerging issues.