2012 Primrose, Wolf Lake, and Burnt Lake Annual Presentation to the ERCB

Surface Operations, Compliance and Issues Not Related to Resource Evaluation and Recovery
January 24, 2013
Premium Value Defined Growth Independent

Primrose, Wolf Lake, and Burnt Lake Annual Presentation to the ERCB for 2011
Directive 54: Performance Presentations, Auditing, and Surveillance of In Situ Oil Sands Schemes January 23, 2013
3.1.1 Subsurface Issues Related to Resource Evaluation and Recovery

January 24, 2013

3.1.2 Surface Operations, Compliance, and Issues Not Related to Resource Evaluation and Recovery

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Slide 2

Outline - Surface Operations, Compliance, and Issues Not Related to Resource Evaluation and Recovery Facilities
Plot Plans, Simplified Plant Schematic, Modifications and Updates

Page
5-9 10-11 12-14 15-17

Facility Performance
Oil & Water Treatment, Steam & Power Generation Gas Usage, Greenhouse Gas Emissions

Measurement & Reporting

Well Production Estimates, Proration factors, Test Durations, New Measurement Technology

Water Production, Injection, and Uses

UWIs, Water Uses and Water Quality Fresh, Brackish, Steam and Produced Water Volumes & Forecasts Brackish Water Supply UWIs & Disposal Well Compliance Wolf Lake Disposal & Water Storage Volumes Wolf Lake Waste Disposal 18-19 20-22 23-25 26 27-32 33 34-38
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Slide 3

Sulphur Production
Summary and Discussion of Emissions

Outline - Surface Operations, Compliance, and Issues Not Related to Resource Evaluation and Recovery Environmental Summary
Compliance Issues & Amendments Monitoring Programs Reclamation Regional Initiatives Arsenic Monitoring Groundwater Monitoring at E14 Pad Primrose East Risk Management Plan Pad 75 Update

Page
39 40-44 45 46 47-50 51-52 53 54 55-63 64 65-72 73-74 75-76
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Slide 4

Well & Formation Integrity Abandonments Approval Condition Compliance

Approvals (9140P, 9108, 8186A, 8672A, 8673, 3929A, 4128D, 9792A)

Discussion of Non-Compliance Items

Self Disclosures

Future Plans

Facilities
Detailed Site Survey Plans - refer to included drawings:
Wolf Lake Plant Plot Plan Primrose Plant Plot Plans (South, North, East) Typical Pad Plot Plan (Primrose East)

Simplified Plant Schematic - refer to included drawings:

Wolf Lake / Primrose Simplified Plant Facilities Schematic

Summary of Modifications
Wolf Lake Brackish Water Expansion Phase 1
Completion of the project started in 2011. Project involved the addition of brackish water tank, VRU, pumps, piping, heater exchangers, pick heater

Wolf Lake Unit 8 DCS Upgrade

Replaced obsolete control system in Wolf Lake Plant Unit 8 (part of multi-year program)

Wolf Lake Slop Oil Treatment System

Added a centrifuge for slop oil treatment

Wolf Lake Unit 2 Separator Replacement

Replacement of an existing damaged inlet separator

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Slide 5

Facilities
Summary of Modifications (contd)
Wolf Lake Oil Debottlenecking
Numerous upgrades to improve oil treating. Including a new ORF in unit 10, sales pump in Unit 8, various vessel control valve upsizing

Wolf Lake Salt Cavern Returns

Installed a salt cavern booster pump and made provisions for future filtration

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Slide 6

Specific Project Updates

Wolf Lake Slop Treatment Modifications
Centrifuge construction complete to treat slop oil (ie oil, water, solids, rag layers, emulsion) from all units Centrifuge to separate oil, water, slurry Slurry to be injected to existing salt caverns System currently involved in commissioning

Brackish Water Expansion Phase 1

Project to increase peak supply/treating/handling capacity to 35,000 m3/d Involves 3 new brackish water wells on existing locations tied into the existing pipeline Plant upgrades include new 20,000 bbl tank, inlet skid and piping, pumps, VRU, steam heating and inlet to Unit 3 WLS, inlet and exchanger to Unit 8 skim tank Project completed and operational

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Slide 7

Primrose East Sulphur Treatment

Temporary produced gas sweetening at Primrose East
Steam plant was shutdown on June 2, 2011 and restarted on February 7, 2012 for reservoir management Produced gas was conserved by sending it to Primrose South as sweet fuel gas A compressor, two phase separator, and liquid H2S scavenger system were installed Flared for first 2 months of steam plant outage due to construction delays System started on July 28, 2011 and was commissioned with sweet gas Flared intermittently due to compressor issues/servicing, Primrose South outages, pigging of the gas pipeline and start up/shutdown of the steam plant System shutdown on February 7, 2012 and decommissioned

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Slide 8

Primrose East Sulphur Treatment (cont)

Prior to system start up (June 2, 2011 July 27, 2011)
Total sulphur flared: ~29 Tonnes

System online (July 28, 2011 February 6, 2012)

Total sulphur removed: ~28 Tonnes Total sulphur flared: ~13 Tonnes

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Slide 9

Facility Performance
Bitumen and Water Treatment
Overall water quality and oil treating targets were generally met: Experienced some treating and produced water de-oiling challenges due to low inlet production temperatures (low produced water volumes and cooler Primrose East emulsion temperatures). Recycling of slop and skimmed oil is causing treating and rag layer issues. Problem is being mitigated by addition of slop oil treatment unit. Currently in commissioning phase. Slop oil treatment unit will be functional in Q1 2013. Performance testing indicated additional available capacity in existing oil treating system. Wolf Lake debottlenecking project is nearing completion. Successfully completed Unit 8 oil side turnaround this year.

Steam Generation
Overall steam generation targets were met:
Primrose South & North achieved 98.1% of budget injected steam volumes Primrose East steam plant was shut down for a total of 39 days at the beginning of 2012 to allow depletion of the area

Corrosion and erosion issues in the steam piping systems caused production losses due to maintenance and repair outages Six economizer tube failures at PSP contributed to unplanned downtime HRSG tube sheet failure at PSP contributed to power disruptions
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Slide 10

Facility Performance
Power Generation/Consumption on a monthly basis

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Slide 11

Facility Performance
Gas Usage on a monthly basis
Total Purchased Gas Month January February March April May June July August September October November December e3m3 92,882 105,719 138,352 123,915 130,400 133,213 129,780 116,428 114,584 126,818 122,500 124,869 Total Solution Gas Conserved e3m3 24,942 23,816 25,227 24,627 23,231 24,647 25,551 23,823 27,414 31,476 22,741 25,498 Total Gas Vented E3m3 13 13 611 44.51 8 12 6 5 1.5 0.4 9 4 Total Solution Gas Flared e3m3 246 553 32 1,437 1,042 175 165 1,207 105 47 125 392 Solution Gas Conserved % 99.0% 97.7% 99.9% 94.2% 95.5% 99.3% 99.3% 94.9% 99.5% 99.8% 97.7% 98.5%

*Total purchased gas does not include gas from site gas wells *Solution gas flared volumes are corrected to remove purchased gas to flare *Total gas vented includes brackish water associated vent gas Notes: 1) Brackish usage increased in March 2012. New VRU commissioned April 24, 2012.

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Slide 12

Facility Performance
Flaring & Solution Gas Conservation Compliance
All Primrose and Wolf Lake facilities are equipped for gas conservation except one pilot well, 15BM granted exemption in 2004 New pads (since 2004) are built with VRUs or are linked to a neighboring pads VRU

Solution Gas Flare Volumes

Conserved ~ 97.9% of total Primrose and Wolf Lake solution gas in 2012

Facility Venting Compliance

No routine venting in the field No routine venting at Primrose North, South or East plants Vapour recovery on all major sources of solution gas at Wolf Lake Plant

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Slide 13

Facilities Greenhouse Gas Emissions

PAW Greenhouse Gas Emissions
*2012 November and December emission is estimated using the average of the previous 3 months
Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov* Dec* Year Total 2012 (tCO2e) 240,863 248,972 313,518 286,850 297,670 302,987 299,681 271,505 274,301 302,522 282,776 286,533 3,408,177

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Slide 14

Measurement and Reporting

Measurement, Accounting & Reporting Plan (MARP) for Wolf Lake / Primrose Thermal Bitumen Scheme Approved May 1st, 2007. Annual updates in March. Methods for estimating well production and injection volumes reported to the Registry
Produced emulsion from the scheme is commingled at the battery. Bitumen and water production from the battery is prorated to each well using monthly proration test data and proration factors. Total Battery Oil (Water) / Total Test Oil (Water) at Wells = Oil (Water) Proration Factor Oil (Water) Proration Factor * Each Well Test Oil (Water) Volume = Oil (Water) Allocated to Each Well Gas allocated to each well is determined by GOR (gas oil ratio) for the battery Total Solution Gas Produced / Total Battery Oil = Gas Oil Ratio Gas Oil Ratio * Oil Allocated to Each Well = Gas Allocated to Each Well Injected volumes of steam and water are not estimated, they are continuously measured at wellhead Some pads have capability to take steam from Primrose South or Primrose North Steam Plant. Estimating steam transfer volume from combined proration factor for both plants.

Test Durations
Through experience, CNRL field operations has identified the test durations, gross fluid rates and BS&W results required to obtain valid proration test data for each well. Most wells have 4 hour proration test durations; however some wells may be tested from 1 to 6 hours depending on their unique operating conditions and cycle maturity. Each well is tested each month and may be tested several times over the month.

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Slide 15

Measurement and Reporting Proration Factors

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Slide 16

Measurement and Reporting

New Measurement Technology
Installed multi-phase flow metering technology.
Conducting field tests since mid-2012. Tests will be continued into 2013. Objective is to identify a multi-phase flow meter which provides adequate performance and accuracy to replace the traditional test separator system for multiple wells

Installed a new nuclear level technology for interface control on one inlet separator vessel at Wolf Lake for improved interface level control. Proceeding with installation on other vessels. Installing low flow steam meters on new pads for improved measurement accuracy at low flows.

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Slide 17

Water Production, Injection, and Uses

Primrose & Wolf Lake Project Water Well UWI Listing
ESRD fresh water well license renewed in 2012 Primrose wells are utility use only

Fresh WSW Wolf Lake 1F1/12-10-066-05W4M 1F2/12-10-066-05W4M 1F1/06-10-066-05W4M 1F2/06-10-066-05W4M 1F1/13-10-066-05W4M 1F2/13-10-066-05W4M Primrose 1F1/10-05-67-04W4 1F1/14-05-67-04W4 1F2/15-05-67-04W4 04-14-67-03W4 NW 08-068-04W4 NW 08-068-04W4 Grand Rapids

Brackish WSW McMurray 1F3/10-03-67-4W4M 1F1/11-06-67-3W4M 1F1/16-12-67-4W4M 1F1/11-05-67-3W4M 1F2/13-08-67-3W4M 1F1/14-08-67-3W4M 1F1/12-09-67-3W4M 1F2/12-09-67-3W4M 1F1/10-08-67-3W4M 1F1/02-12-67-3W4M 1F1/07-06-67-3W4M

102/10-08-66-5W4M 102/05-16-66-5W4M 104/05-16-66-5W4M 109/01-17-66-5W4M 107/02-17-66-5W4M 106/08-17-66-5W4M 107/08-17-66-5W4M

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Slide 18

Water Production, Injection, and Uses

Fresh water uses
Utility water, utility steam, seal flush and gland water, slurry make-up, dilution water, filter backwash, quench water, miscellaneous ends up as boiler feed water Water softener regenerations some of this water is recycled as boiler feed water and some is used as cavern wash and then sent to disposal Fresh water may also be used for boiler feed water make-up as required

Brackish water uses

De-sand quench, filter backwash ends up as boiler feed water Boiler feed water make-up supply

Water Quality Assessment

Quaternary Water Source Wells (6)
Empress Unit 3 & Muriel Lake Formations Average TDS = 609 mg/L, TDS ranges from 575 to 640 mg/L

Grand Rapids Fm. Water Source Wells (7)

Average TDS = 9,721 mg/L, TDS ranges from 8,900 to 10,300 mg/L

McMurray Fm. Water Source Wells (10)

Average TDS = 7,276 mg/L, TDS ranges from 6,470 to 8,570 mg/L

Produced Water Quality

Typical parameters: TDS = 7,102 mg/L, Cl = 3,700 mg/L, pH 7.3, hardness = 99 mg/L

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Slide 19

Water Production, Injection, and Uses

Fresh, brackish, produced and steam injection volumes

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Water Production, Injection, and Uses

Long term make-up yearly requirements approximately 35,000 m3/d Reduction of fresh groundwater use down to 3,000 m3/d in mid-2014

Excludes Surface Water and Cold Lake Fish Hatchery Effluent Volumes

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Slide 21

Water Production, Injection, and Uses

PAW water volume summary for 2012
Wolf Lake Fresh Water - Average 9,427 m3/d Grand Rapids Brackish Water - Average 920 m3/d McMurray Brackish Water - Average 18,089 m3/d Burnt Lake Pilot Water Cold Lake Fish Hatchery Effluent Diversion - Average 837 m3/d Plant Runoff Water Average 352 m3/d

No runoff data before 2006

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Slide 22

Water Production, Injection, and Uses

Brackish to Fresh Groundwater Ratio
Increase in brackish use compared to 2011 (19,065 vs. 13,512 m3/d) Average brackish to fresh groundwater ratio was 2.02 in 2012 (1.64 in 2011)

Excludes Cold Lake Fish Hatchery Effluent Volumes

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Slide 23

McMurray Brackish Water Supply Existing

Producing wells
3 Horizontals and 7 Verticals 3 vertical wells brought online in Q1 2012

2012 production
average 18,089 m3/d maximum 30,222 m3/d CNRL McMurray Wells

06-30 Obs Well 14-02 Obs Well

Drawdown of 69 m in obs well 6-30 (6 km from pumping centre)

25 m Contour

IOR Pumping Centre

McMurray Fm Basal Aquifer Isopach Map - targeted due to prolific nature of aquifer
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Slide 24

McMurray Brackish Water Supply Phase 2 Expansion

Phase 2 Expansion
Develop new pumping centre in NW67-3 and SW68-3
away from planned CSS development following basal aquifer fairway north of existing pumping centre (PC1) add up to six water wells
C-314 C-314 Target C-314 Target Circle Target Circle Circle

PC2 PC2 PC2

Refurbishment of old pipeline Construction of new pipeline and roads in 2013/2014 Constraints
Geology Thermal development Target circle Mineral and surface rights

PC1 PC1 PC1

CNRL CNRL CNRL McMurray McMurray McMurray Wells Wells Wells

System operational by end of Q2 2014

August 2010

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Slide 25

Water & Waste Disposal Wells, Landfill Waste UWI List & Disposal Compliance
Primrose & Wolf Lake Project Disposal Water Well UWI Listing
Wells shown in bold are active, (Wolf Lake - WDW#1 and WDW#9 are zonally abandoned)
Wolf Lake WDW#1 - 100090806605W400 WDW#2 - 100100806605W400 WDW#4 100050806605W400 WDW#5 - 100150706605W400 WDW#9 - 100140506605W400 Primrose South 103100506704W400 Primrose East 100031106703W400 1F1110206703W400

Wolf Lake (WDW #2, 4, & 5)

Disposal scheme was amended on June 16/10 to allow injection into WDW #4 (Approval 8672A). Maximum wellhead injection pressures decreased from 17,500 kPa to 13,770 kPa; with the ability to inject at 17,500 kPa for a maximum time period of 24 hrs.
Injection pressures have not exceeded 13,770 kPa in WDW #2, 4, or 5 in 2012.

Primrose South
Injected 0 m3 fluid in 2012

Primrose East
11-2 out of service since August 2007. Abandonment work still outstanding. Ongoing discussions with ERCB

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Slide 26

Water & Waste Disposal Wells, Landfill Waste Wolf Lake Disposal Volumes
2012 Average Monthly Disposal Rates, Temperature and Pressure
4500
Flow Pressure Temp

60

4500

WDW #2: 2012 Average Monthly Disposal Rates, Temperature and Pressure
Flow Pressure Temp

60

Pressure (MPa)x100, Volume (m3/d

4000 50 3500 3000 2500 30 2000 1500 1000 10 500 0 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 0 20 40

Pressure (MPa)x100, Volume (m3/d

4000 3500 3000 2500 2000 1500 1000 500 0 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 -500 20 30 50

40

10 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 0

WDW #4: 2012 Average Monthly Disposal Rates, Temperature and Pressure
8000 Flow Pressure Temp 60

7000

WDW #5: 2012 Average Monthly Disposal Rates, Temperature and Pressure
Flow Pressure Temp

60

Pressure (MPa)x100, Volume (m3/d

Pressure (MPa)x100, Volume (m3/d

7000 50 6000 5000 4000 3000 2000 10 1000 0 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 0 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 40

6000

50

5000 40 4000 30 3000 20 2000 10

30

20

1000

0 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12

0 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12

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Water & Waste Disposal Wells, Landfill Waste Wolf Lake Water Storage

Water is stored in the C3 Formation

Converted two wells to injectors in June 2003 M2-E

Injected 348,255 m3 total

189,085 m3 to M2-S 159,170 m3 to M2-E

M2-E and M2-S are currently configured for short notice injection

M2-S

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Slide 28

Water & Waste Disposal Wells, Landfill Waste Wolf Lake Water Storage Volumes
Wolf Lake Water Storage Volumes
Year Month 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec M2_E M2_S Gross Oil Water Water Inj Gross Oil Water Water Inj (m3/d) (m3/d) (m3/d) (m3/d) (m3/d) (m3/d) (m3/d) (m3/d) 21 2 20 243 40 1 39 292 0 0 21 28 0.2 28 49 0.3 4 146 174

16 5.39 13.74 19.14 0 6.90 0 0 0.32 0 0 12.90 9.33 0

0.03 0.14 0 0 0 0.33 0 0 0.32 0 0 0 0.33 0

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Slide 29

Water & Waste Disposal Wells, Landfill Waste Wolf Lake Water Storage Compliance
Formation Integrity and Pressure Monitoring
Offset well reservoir pressures never exceeded the 2.5 MPa allowable during injection periods M2-E injection packer successfully passed packer isolation test in 2012 M2-S injection packer successfully passed packer isolation test in 2012 No wellbore integrity issues encountered

Wolf Lake Water Storage Reservoir

M2 & N2 Cumulative DI = 1.26
Cumulative Gross Production = 12,535,817 m3 Cumulative Oil Production = 1,539,321 m3 Cumulative Steam Injected = 9,915,737 m3 CWE Cumulative Water Injected = 348,235 m3

M2 & N2 Remaining Voidage = 2,271,845 m3

DI

Total Fluid Produced (Bitumen  Water) Total Steam Injected (CWE)

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Water & Waste Disposal Wells, Landfill Waste Wolf Lake Water Storage Balance
From the outlined area (M2 wells and N2-F)
Total Injected Water = 348,235 m3 since Jan 03 Total Produced Water = 592,374 m3 since Jan 03 Difference = 244,139 m3

Expected to have minimal water storage in 2013.

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Slide 31

Water & Waste Disposal Wells, Landfill Waste Wolf Lake Water Storage Summary
Injectors appear to communicate readily with offset wells No problems anticipated when pumping out injected water Intend to maintain two wells as short notice injectors Expect to have minimal produced water storage in 2013 M2-E and M2-S are classified as disposal wells on S-4 forms

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Slide 32

Water & Waste Disposal Wells, Landfill Waste Waste Disposal Summary
Waste to CCS Lindbergh Cavern
107,125 m3 liquid wastes including drilling wastes for PAW production (new pads) and OSE

Waste to CCS Bonnyville Landfill

4,918 m3 contaminated soil 59,944 tonnes - lime sludge waste

Waste to RBW
845 m3 solid waste contaminated soils, plastics, filters inorganic chemicals, asbestos, scrap metal, glycol, caustics

Waste to NewAlta
3,178 m3 sludges 822 m3 coemulsion
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Slide 33

Sulphur Production
EPEA approval limits for SO2:
PSP + WLP = 6.7 t/d PNP = 2.0 t/d PEP = 2.0 t/d

CEMS values are used for reporting at all steam plants

PNP from September 1, 2010 onward PEP, PSP, and WLP from April 1, 2011 onward

Quarterly averages for all steam plants < 1.0 t/d sulphur Contingency for compliance with ID 2001-3 is currently to restrict/delay production to maintain sulphur level below 1 t/d quarterly average

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Slide 34

Sulphur Recovery Study

Objective
Q4 2012 decision to proceed or not proceed with Sulphur Recovery at any one or all Primrose Steam Plants

Requirements
Selection of Optimal Technology
Liquid Scavenger

Economic Assessment of Delayed Oil vs. Sulphur Recovery

Based on April 2012 10 Year Plan and Sulphur Model

Conclusion
Do not proceed with Sulphur Recovery at any of the Primrose Plants at this time

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Slide 35

Sulphur Production

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Slide 36

Sulphur Production
To maintain sulphur levels below 1 t/d, production from the following wells/pads were held back in Q1 2012:
Month of February:
Last 2 weeks of February: Primrose South Pad 28 S & N held back 4,590 m3 oil production Primrose North Pads 62 & 66 held back 1,070 m3 oil production Township 68 pads held back 5,660 m3 oil production

Month of March:
Week of March 1: Primrose South Phases 13, 14, 28 S & N held back production
Production held back: 5,100 m3 oil

Township 68 south 3 pads held back production: 5,100 m3 oil

Production limitations lifted March 9, 2012

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Slide 37

Sulphur Production
To maintain sulphur levels below 1 t/d, production from the following wells/pads were held back in Q1 2012 (Cont):
Production limitations reinstated for March 20 - 28, 2012 Pads affected are as follows:
Primrose North Plant (excluding Township 68 pads) Held back 175 m3 of oil Primrose South Plant Held back 800 m3 of oil Primrose North Plant Township 68 pads Held back 975 m3 of oil

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Slide 38

Environmental Summary Compliance & Amendments

Compliance Issues
EPEA Approval: Air Related OTSG NOx exceedance later verified and followed up as non-exceedance (Primrose East June 2, 2012) Heat recovery steam generator Continuous Emissions Monitoring System availability uptime <90% (Primrose South Dec 19, 2012) Water Related: Runoff pond licensing discrepancies (April 19, 2012 Primrose North and East plant) E-Pond high pH water discharge (July 22, 2012 Primrose East) WSW daily limit exceedance (Sept 11, 2012 Wolf Lake Plant) WSW daily limit exceedance (Dec 4, 2012, PRS) WSW daily limit exceedance (x5) (Dec 13, 2012, PRS). Notice of Investigation Surface Runoff Ponds Primrose North and East runoff ponds investigation use of runoff water without Water Act approval Water Act Approval subsequently obtained for runoff ponds Administrative Penalty unauthorized installation (2008) and operation of the Wolf Lake 4 flare stack

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Slide 39

Environmental Summary Monitoring Programs

Environmental Monitoring Programs currently underway include:
Wildlife Monitoring Program Wildlife Mitigation Plan Wildlife Habitat Enhancement Program Wetlands and Hydrology Monitoring Program

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Slide 40

Environmental Summary Monitoring Programs

Objectives of Wildlife Monitoring Program
To determine if the PAW project has an influence on the abundance and distribution of wildlife species; The effectiveness of crossing structures; and Distribution and movement of caribou.

Wildlife Monitoring Program activities for 2012:

Breeding songbird surveys
58 transects surveyed

Winter track surveys

36 transects surveyed

Woodland caribou cameras

41 remote cameras deployed for 12 weeks along eastern and northern boundaries of Project Area to capture seasonal movement of caribou in the fall.

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Slide 41

Environmental Summary Monitoring Programs

Wildlife Mitigation Plan activities in 2012
Remote Camera Monitoring of Above-Ground Pipeline
30 remote cameras deployed along AGP to record wildlife behaviour and confirm wildlife movement under the AGP 30 remote cameras deployed along game trails or cutlines near remote camera areas on the AGP to record wildlife occurrence and behaviour as animals approach the pipeline

Wildlife Winter Tracking Along AGP

38.6 km of AGP surveyed, noting movement patterns and wildlife behavioural responses near the AGP

Wildlife Habitat Enhancement Program

Nest Box Program
20 nest boxes maintained to confirm bird use during the breeding season. 30% showed evidence of use.

Revegetation Program
No activities in 2012; activities planned for 2013

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Slide 42

Environmental Summary Monitoring Programs

Hydrology, Wetlands and Water Quality Monitoring Program 2012
2012 was the 6th year of the Hydrology Monitoring component which provides monitoring for lakes within the PAW development area. Water quality program (started in 2009) continued surface water quality data collection from Burnt Lake and Sinclair Lake
ESRD approved reduction of sampling events from 3 to 2 Sampling locations and depths did not change from 2011 to 2012

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Slide 43

Environmental Summary Monitoring Programs

Preliminary Results
Hydrology Program
Looseman Lake and North Reference Lake experienced average lake levels lower than the August 1, 2007 reference level. This may be attributed to changing outlet conditions or lower seasonal inputs.

Wetland Monitoring Program

2012 re-measurement of wetland sites indicates only small differences in species richness among monitoring and reference sites.

Water Quality Program

To-date, no large deviation was observed for surface water quality samples from Burnt Lake and Sinclair Lake. Phenol concentrations at Burnt Lake were at or above guideline concentrations in a majority of samples. Total phosphorus at or above guideline concentrations at Sinclair Lake. Continued monitoring will determine if these results are indicative of a trend.

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Slide 44

Environmental Summary Reclamation Programs

Reclamation activities in 2012:
Reforested 13.6 ha of borrows in Primrose South. Infill planting on 10 ha of borrows in Primrose South and East. Total of 23.60 ha using 11,305 Trees and Shrubs.

Proposed activities in 2013:

Reforestation of 32.70 ha of Borrows in Primrose East. Planting of 0.52 ha Linear disturbances and 0.8 ha of non-linear disturbances as part of our Habitat Enhancement Program.

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Slide 45

Environmental Summary Regional Initiatives

LICA Airshed Zone
LICA is responsible for monitoring regional air quality Currently four continuous monitoring sites (Cold Lake, Maskwa, St. Lina and Portable), 26 passive stations, two VOC and PAH samplers, and two soil acidification monitoring plots distributed throughout the region.

Beaver River Watershed Alliance (BRWA):

The BRWA serves as the Watershed Planning and Advisory Council (as set out by Alberta Environment) for the Beaver River Watershed The BRWA State of the Watershed Report to be published spring 2013 provides a snapshot of watershed health and will act as the guiding document for development of the upcoming Water Management Plan for the Beaver River watershed.

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Slide 46

Environmental Summary Monitoring - Dissolved Arsenic Z8 Pad

Arsenic Liberation in Groundwater Evaluate liberation of arsenic associated with elevated groundwater temperatures from steaming Z8 Investigation ongoing since 2001 Measure arsenic concentration and temperature in 30 wells focus on 10 Empress Fm Wells ~ 150 m depth Temporal assessments associated with steaming Results - Empress Formation
Background 75 m downgradient 30.4 deg C 0.131 mg/L 360 m downgradient 9.4 deg C 0.056 mg/L

Temp As Conc

5.2 deg C 0.041 mg/L

Sept to Nov 2012

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Slide 47

Environmental Summary Monitoring - Dissolved Arsenic Z8 Pad

Groundwater In-Situ Temperatures - Empress Formation - Overall down-gradient thermal plume migration - Temperatures decrease with distance from the Pad - Temperatures are increasing over time

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Slide 48

Environmental Summary Monitoring - Dissolved Arsenic Z8 Pad

Groundwater Dissolved Arsenic Concentrations Empress Formation - Overall down-gradient dissolved arsenic plume migration - Concentrations increasing at down-gradient wells - Dissolved arsenic concentrations at Z8-23 (135m) and Z8-25 (160m) are greater than Z8-21 (75m)

Z8-03 E1

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Slide 49

Environmental Summary Monitoring - Dissolved Arsenic Z8 Pad

Summary of Z8 Pad Field Findings Empress Formation
Increasing temperatures and concentrations at wells show that thermal and dissolved arsenic plumes are migrating down-gradient Dissolved arsenic concentration 135 m down-gradient of Pad is just greater than approximately 4 times background Dissolved arsenic plume expected to eventually detach from Pad as plume migrates down-gradient (no steaming since 2005) Arsenic plume leading-edge is likely greater than 360 m down-gradient

Program for New Monitoring Wells

Selected locations for two new Empress Formation monitoring wells (downgradient and cross-gradient) expect to undertake in 2013

Ongoing Work
Continued temperature and arsenic monitoring Regional Quaternary geology review Ongoing monitoring of arsenic in CNRL regional monitoring network
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Slide 50

Groundwater Monitoring at E14 Pad

A groundwater monitoring well was installed at E14 Pad (16-32-06505W4M) as per the amendment to the Commercial Scheme Approval 9140I for SIB Pad
Installed on the south side of the pad in July 2010 to monitor for changes in the basal quaternary aquifer associated with SIB operation Completed into the basal aquifer identified as the Muriel Lake (121 to 127 metres below ground surface) Instrumented to monitor water levels and temperatures Sampled semi-annually as part of regional groundwater monitoring program
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Slide 51

SIB

E14
16-32a

Groundwater Monitoring at E14 Pad

Groundwater Monitoring Results for 16-32a
- Anomalous water levels not noted - In-situ groundwater temperature at 7C - Anomalous groundwater chemistry not noted (comparable to regional results Muriel Lake Formation chemistry)

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Slide 52

Primrose East Pad 74 Risk Management Plan

The Primrose East groundwater management is continuing Ongoing application of the Pad 74 Risk Management Plan including:
Ongoing daily pressure and temperature monitoring in 24 wells on site Ongoing monthly and quarterly groundwater sampling Monthly reporting of Primrose East Area 1 (including Pad 74) groundwater chemical analytical results (ERCB and ESRD)

Monitoring and sampling results are reported annually to ESRD via PAW EPEA Approval since March 2012. Elevated dissolved solids and dissolved hydrocarbons have been noted in the past but currently neither exceed Tier 1 criteria.

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Pad 75 Update

Elevated dissolved solids and dissolved hydrocarbons noted in the Bonnyville Aquifer at Pad Source believed to be release of BFW or produced water from 18A75 due to a casing breach In 2012 remediation was initiated - pumped water from Bonnyville Aquifer at three wells:
05-12h July 11 through 24, 2012 05-12g July 30 through October 22, 2012 05-12f August 4 through October 22, 2012

Recovered 235 m3 groundwater in total Recovery system shut down for the winter on October 22, 2012 Pumping will resume in June 2013 Ongoing reporting to ESRD and ERCB
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Well Integrity - Summary of 2012 Casing Failures

Out of Zone Casing Failures:
There are 13 out of zone casing failures in PAW in 2012

Passive Seismic on Pad 66 damaged Jan 2012

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Well Integrity - Summary of 2012 Casing Failures

Out of Zone Casing Failures:
Current status of 2012 out of zone casing failures
Well 8C28 18A78 11A74 14A77 4C28 8B51 6A66 14A66 12A66 7A77 15A62 14A63 4B29 Primary/ Slimhole P P P P P P P P P P P P P Tubular OD (mm) 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 Failure In: CONN CONN CONN CONN CONN CONN CONN CONN CONN CONN CONN CONN CONN Confirmation Date 13-Feb-12 20-Feb-12 28-Feb-12 28-Feb-12 23-Mar-12 17-May-12 30-May-12 16-Jul-12 8-Aug-12 6-Sep-12 20-Sep-12 30-Sep-12 20-Dec-12 Cycle of Failure: 3 3 4 3 3 3 5 5 5 4 5 3 4 Well Phase During Failure Pump Pump Pump Pump Pump/WKO Pump Pump/WKO Pump Pump/WKO Pump Pump Pump Pump Current Status Patched Slimhole On Production - Fluid Level Below Break Slimhole Patched Zonally suspended Slimhole Slimhole Slimhole On Production - Fluid Level Below Break Slimhole Zonally suspended Zonally suspended

All 2012 out of zone casing failures were at the connection `

No high pressure well failures in 2012

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Well Integrity - Summary of 2012 Casing Failures

In Zone Casing Failures:
There are 18 confirmed in zone casing failures in 2012

Majority of the in zone failures were at TWP 68

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Well Integrity - Summary of 2012 Casing Failures

In Zone Casing Failures:
Current status of 2012 in-zone casing failures
Well 1A77 9C28 3A67 11A62 1C27 13A58 2C27 13A62 2A67 5A67 9A63 15A63 13A63 16A63 10A63 10A59 12A63 6A63 Primary/ Slimhole P P P P P P P P P P P P P P P P P P Tubular OD (mm) 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 244.5 Failure In: CONN CONN UNKNOWN UNKNOWN CONN CONN BODY CONN Unknown UNKNOWN CONN UNKNOWN CONN UNKNOWN CONN CONN CONN CONN Confirmation Date 21-Mar-12 4-Apr-12 18-May-12 19-May-12 8-Jun-12 8-Jun-12 20-Jun-12 10-Jul-12 25-Jul-12 25-Jul-12 22-Aug-12 31-Aug-12 4-Oct-12 10-Oct-12 2-Dec-12 13-Dec-12 14-Dec-12 17-Dec-12 Cycle of Failure: 3 3 3 5 4 5 4 5 3 3 3 3 3 3 3 3 3 3 Well Phase During Failure Pump/WKO Pump Pump/WKO Pump/WKO Pump/WKO Pump/WKO Pump Pump Steam Pump Steam Trickle Steam Steam Steam Trickle Steam Trickle Prod Trickle Steam Trickle Prod Current Status Casing patch Zonally suspended Zonally suspended Zonally suspended Casing patch Casing patch Casing patch Initial mitigation was to slimhole Zonally suspended Mech Plug Casing patch Casing patch On Production - Low Pressure Casing patch Casing patch Casing patch Casing patch Casing patch

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Well and Formation Integrity Logs

Casing Pressure Monitoring
No casing failures were detected via DFP (differential flow pressure)

Corrosion Logs
A Vertilog was run in Primrose East well 11A78 in response to investigating a near surface casing failure at ~61m MD
No significant corrosion was observed from TD to surface

- A Vertilog was run on water source well 110

Corrosion was found at ~450m at the pump landing depth Internal corrosion of the 273mm production casing occuring within the formation Design of future water source wells under review by the team to address this issue

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Well and Formation Integrity Logs

Cement Bond Logs (CBL)
100% of all new wells in 2012 had cement bond logs run (160 total)
160 CSS down to the Clearwater Formation Directive 51 applications were submitted for 9 pads 9 applications were approved by the ERCB

84 other wells had cement bond logs run in 2012 (All casing failures had a
cement bond log run for investigative and/or post repair purposes)

13 post steam CBLs were run for investigative purposes on well with up-hole casing failures CBLs run at Primrose East: 17 CBLs were run on observation wells 43 CBLs were run for investigative purposes on burnt lake primary wells CBLs run at Primrose South: 11 CBLs were run on observation wells

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Well and Formation Integrity Casing and Cementing investigations

Review of casing failures at the BFS had indicated a correlation to collars placed within 4m of the BFS and failures of those collars.
Drilling program has been modified to ensure a casing collar is not placed within 4m of the BFS

Review of casing failures at the CLWR top indicate that the connection closest to the shale/sand interface is most likely to fail Other drilling changes:
Increased centralization through BFS and CLWR shale top
BFS to improve cement bond CLWR to decrease differential sticking to ensure rotation while cementing

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Formation Integrity Thermal Fibre

Thermal fibre gives us the ability to monitor for fluid migration attributed to inferior cement jobs Thermal fibre is CNRLs preferred method for fluid monitoring within the Colorado Shales Monitoring to date has shown no issues during steaming or production Data quality is acceptable, in that temperature profiles are repeatable

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Formation Integrity B12 Pressure Monitoring

B12 pressure monitoring has proven to be an effective addition to formation integrity surveillance during high pressure CSS
Under certain circumstances it can be difficult to distinguish heave from fluid invasion based on B12 pressure alone
Pressure anomalies in the B12 must be examined in conjunction with all available data to determine pressure response sources: Passive seismic, thermal fiber, injectivity plots, production data

Continue to obtain data to quantify the poro-elastic heave pressures in the B12 (Lower Grand Rapids) during high pressure CSS steaming Primrose East, Township 68, Phase 28 and Phases 22-24 all are currently equipped with B12 monitoring equipment
All new pads are equipped with B12 pressure monitoring

CNRL shall notify the ERCB if a B12 pressure increase/decrease is greater than 200 kPa/day
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Well and Pad Abandonments

There were 3 wells abandoned in 2012 in the Primrose/Wolf Lake area. CNRL plans to review all suspended wells to determine which wells require abandonment in order to ensure compliance to ERCB Directive 13 requirements

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Approvals Approval 9140P Oil Sands Primrose Wolf Lake

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Approval 9140P Oil Sands Primrose Wolf Lake

Original Approval August 2002 Amendment A - Approved October 2003
Approval to conduct Gas and Gas Solvent enhanced recovery pilot

Amendment H - Approved July 2010

Approval for Grand Rapids S1B SAGD Pad

Amendment I - Approved September 2010

Approval for PRS Phases 22-24

Amendment B - Approved January 2004

Approval to develop PRN and decrease production volume to 14,000 m3/d

Amendment J - Approved November 2010

Approval for PRE Development Area 2

Amendment C - Approved March 2007

Approval for PRE and increase production volume to 19,000 m3/d Approval for Orange Valley Sand Phases 41-50 and Blue Valley Sand Phases 8, 9, 11, 12 (West)

Amendment K - Approved December 2010

Approval for Trim Treating during PEP Steam Outage

Amendment D - Approved March 2007

Approval to expand the development area to include 67-5W4M Approval 6804 (Burnt Lake rescinded)

Amendment L - Approved August 2011

Approval for modification of PRE Phases 90/91 drainage boxes

Amendment M - Approved October 2011

Approval for PRS Phases 25/26 Approval for PRN Phases 60, 61, 64, 65 & 68

Amendment E - Approved March 2008

Pads 58, 62, 66 modification to development plan

Amendment F - Approved August 2008

Pads 59, 63, 7 modification to development plan

Amendment N - Approved February 2012

Approval for PRS D1 Steamflood Trial

Amendment G - Approved February 2010

Approval for McMurray MC1 SAGD Pad

Amendment O - Approved May 2012

Approval for Wolf Lake Sparky B8 Trial

Amendment P - Approved November 2012

Approval for Primrose South Phases 40-43

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Approval 9108 Wolf Lake Water Storage Approved July 2002

Annual Report
(a) Summary of monthly injected and produced volumes/well (b) Well/Formation Integrity (c) Reservoir Water Storage remaining (d) Water Balance, Bitumen Volumes and Incremental Recovery (e) Overall performance and 2012 plans (f) Discussion of produced water utilization & fresh water reductions

IN COMPLIANCE

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Approval 8186A Burnt Lake Water Disposal Approved February 1999

Approval Compliance Requirements
Directive 51 Compliance Maximum Injection Pressures (kPa)
F1/11-02-067-03W4/0 = 7800 00/03-11-067-03W4/0 = 5500

Injection packer isolation test failed on 11-2 in 2008

Well currently shut-in Work in progress

No disposal in 2012 as water is now recovered and re-used

IN COMPLIANCE

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Approval 8672A Wolf Lake Deep Disposal Approved June 2010

Approval Compliance Requirements Directive 51 Compliance Operational injection pressure limit 13,770 kPa Maximum injection pressure 17,500 kPa for a 24 hour period Disposal wells are:
WDW#1 - 00/09-08-066-05W4/0 WDW#2 - 00/10-08-066-05W4/0 WDW#4 - 00/05-08-066-05W4/0 WDW#5 - 00/15-07-066-05W4/0 WDW#9 - 00/14-05-066-05W4/0

IN COMPLIANCE

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Approval 8673 Cavern Disposal Approved October 2000

Approval Compliance Requirements
Monitoring Maximum Injection Pressures Annual Report
2011 Report Submitted 2012 Report will be prepared following annual cavern sounding

Salt Cavern 1 118/12-8-66-5W4

Cavern volume (as of April 2012 sounding) 191,531 m3 Wash water 10,862 m3 Oily waste (bitumen) 25 m3 Solid waste 0 m3 Next Cavern sounding expected in April 2013

Salt Cavern 2 - 119/12-8-66-5W4 Washing Only

Cavern volume (as of April 2012 sounding) 51,308 m3 Wash water 22,678 m3 Next Cavern sounding expected in April 2013

IN COMPLIANCE

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Approval 3929A Primrose Class 1b Disposal Amended September 2011

Approval Compliance Requirements
Originally approved 1983 Transferred to Canadian Natural from Dome Petroleum September 2011 Directive 51 Compliance Maximum Wellhead Injection Pressures (kPa)
03/10-05-067-04W4/0 = 6,000

IN COMPLIANCE

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Additional ERCB Disposal Approvals

Approval No. 4128D Class II Disposal
Transferred to Canadian Natural from Dome Petroleum September 2011 Directive 51 Compliance 02/10-05-067-04W4/0 = 16,000 kPA

Approval No. 9792A Class II Disposal

00/14-02-065-08W4/0 has been abandoned and the approval was rescinded September 2011

IN COMPLIANCE

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Compliance Disclosures
Reportable spills
18 reportable spills were reported in 2012 including; 5 emulsion, 3 hydrochloric acid, 2 boiler feed, 1 hydrated lime, 1 oil, 1 sludge, 1 brackish water, 1 high pH, 1 produced water, 1 drilling mud and 1 diesel fuel.

Digital Data Submissions (DDS)

Notifications/Submissions were entered into the DDS as per Directives in 2012.

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Non-Compliance
ERCB Scheme Approval 9140
None

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Future Plans
Wolf Lake Plant Control System & Electrical Upgrades
Significant work ongoing to upgrade equipment and infrastructure

Wolf Lake Unit 2 Improvements

IGF Replacement, desand system upgrades

Wolf Lake Salt Cavern Filtration

Salt cavern return filtration and booster pumps

Wolf Lake Oil Treating Capacity (9140 Approval 19,000 m3/d)

Increasing plant capacity to ~ 23,000 m3/d

Brackish Water System/Fresh Water Reduction

Reduce fresh water usage to 3,000 m3/d: Additional supply wells, pipelines, convert fresh water users to brackish water, glycol system expansion

Regulatory applications will be filed as required

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Future Plans
Wolf Lake Steam Generation Capacity Increase
Reviewing addition of steam generation for future SAGD steam demand and brackish heating

Surface Facilities Associated with Field Development

Primrose South/East/North Pads (PRS 25-26, PRS 40-43, PRN 60-68)

Primrose East Heat Integration

Re-piping inlet heat exchangers to optimize heat transfer

Primrose South Steam Generator Economizer Upgrades

Replace damaged equipment and improve efficiency, 2 OTSGs targeted for 2013 Replace damaged HRSG evap modules

Regulatory applications will be filed as required

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Forward Looking Statements

Certain statements in this document or documents incorporated herein by reference constitute forward-looking statements or information (collectively Certain statements relating to the Company in this document or documents incorporated herein by reference constitute forward-looking statements or information (collectively referred to herein as forward-looking statements) within the meaning of applicable securities legislation. Forward-looking statements can be identified by the words believe, anticipate, expect, plan, estimate, target, continue, could intend, may, potential, predict, should, will, objective, project, forecast, goal, guidance, outlook, effort seeks, schedule or expressions of a similar nature suggesting future outcome or statements regarding an outlook. Disclosure related to expected future commodity pricing, production volumes, royalties, operating costs, capital expenditures, and other guidance provided in the 2010 outlook section and throughout this document and the documents incorporated herein by reference constitute forward looking statements. Disclosure of plans relating to existing and future developments including but not limited to Horizon, Primrose East, Pelican Lake, Olowi Field (Offshore Gabon), and the Kirby Thermal Oil Sands Project also constitute forward-looking statements. This forward-looking information is based on annual budgets and multi-year forecasts and is reviewed and revised throughout the year if necessary in the context of targeted financial ratios, project returns, product pricing expectations and balance in project risk and time horizons. These statements are not guarantees of future performance and are subject to certain risks. The reader should not place undue reliance on these forward looking statements as there can be no assurances that the plans, initiatives or expectations upon which they are based will occur. In addition, statements relating to reserves are deemed to be forward-looking statements as they involve the implied assessment based on certain estimates and assumptions that the reserves described can be profitably produced in the future. There are numerous uncertainties inherent in estimating quantities of proved crude oil and natural gas reserves and in projecting future rates of production and the timing of development expenditures. The total amount or timing of actual future production may vary significantly from reserve and production estimates. The forward-looking statements are based on current expectations, estimates and projections about the Company and the industry in which the Company operates, which speak only as of the date such statements were made or as of the date of the report or document in which they are contained and are subject to known and unknown risks, uncertainties and other factors that could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such risks and uncertainties include, among others: general economic and business conditions which will, among other things, impact demand for and market prices of the Companys products; volatility of and assumptions regarding crude oil and natural gas prices; fluctuations in currency and interest rates; assumptions on which the Companys current guidance is based; economic conditions in the countries and regions in which the Company conducts business; political uncertainty, including actions of or against terrorists, insurgent groups or other conflict including conflict between states; industry capacity; ability of the Company to implement its business strategy, including exploration and development activities; impact of competition; the Companys defense of lawsuits; availability and cost of seismic, drilling and other equipment; ability of the Company and its subsidiaries to complete its capital programs; the Companys and its subsidiaries ability to secure adequate transportation for its products; unexpected difficulties in mining, extracting or upgrading the Companys bitumen products; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; ability of the Company to attract the necessary labour required to build its thermal and oil sands mining projects; operating hazards and other difficulties inherent in the exploration for and production and sale of crude oil and natural gas; availability and cost of financing; the Companys and its subsidiaries success of exploration and development activities and their ability to replace and expand crude oil and natural gas reserves; timing and success of integrating the business and operations of acquired companies; production levels; imprecision of reserve estimates and estimates of recoverable quantities of crude oil, bitumen, natural gas and liquids not currently classified as proved; actions by governmental authorities; government regulations and the expenditures required to comply with them (especially safety and environmental laws and regulations and the impact of climate change initiatives on capital and operating costs); asset retirement obligations; the adequacy of the Companys provision for taxes; and other circumstances affecting revenues and expenses. Certain of these factors are discussed in more detail under the heading Risk Factors. The Companys operations have been, and at times in the future may be affected by political developments and by federal, provincial and local laws and regulations such as restrictions on production, changes in taxes, royalties and other amounts payable to governments or governmental agencies, price or gathering rate controls and environmental protection regulations. Should one or more of these risks or uncertainties materialize, or should any of the Companys assumptions prove incorrect, actual results may vary in material respects from those projected in the forward-looking statements. The impact of any one factor on a particular forward-looking statement is not determinable with certainty as such factors are dependent upon other factors, and the Companys course of action would depend upon its assessment of the future considering all information then available. Readers are cautioned that the foregoing list of important factors is not exhaustive. Unpredictable or unknown factors not discussed in this report could also have material adverse effects on forward-looking statements. Although the Company believes that the expectations conveyed by the forward-looking statements are reasonable based on information available to it on the date such forward-looking statements are made, no assurances can be given as to future results, levels of activity and achievements. All subsequent forward-looking statements, whether written or oral, attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Except as required by law, the Company assumes no obligation to update forward-looking statements should circumstances or Managements estimates or opinions change.

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Reporting Disclosures
Special Note Regarding Currency, Production and Reserves In this document, all references to dollars refer to Canadian dollars unless otherwise stated. Production data is presented on a before royalties basis unless otherwise stated. In addition, reference is made to oil and gas in common units called barrel of oil equivalent (boe). A boe is derived by converting six thousand cubic feet of natural gas to one barrel of crude oil (6 mcf:1 bbl). This conversion may be misleading, particularly if used in isolation, since the 6mcf:1bbl ratio is based on an energy equivalency at the burner tip and does not represent the value equivalency at the well head. Reserves For the year ended December 31, 2010 the Company retained Independent Qualified Reserves Evaluators (Evaluators), Sproule Associates Limited and Sproule International Limited (together as Sproule) and GLJ Petroleum Consultants Ltd. (GLJ), to evaluate and review all of the Companys proved and proved plus probable reserves with an effective date of December 31, 2010 and a preparation date of February 14, 2011. Sproule evaluated the North America and International crude oil, NGL and natural gas reserves. GLJ evaluated the Horizon SCO reserves. The evaluation and review was conducted in accordance with the standards contained in the Canadian Oil and Gas Evaluation Handbook (COGE Handbook) and disclosed in accordance with National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities (NI 51-101) requirements. In previous years, Canadian Natural had been granted an exemption order from the securities regulators in Canada that allowed substitution of U.S. Securities Exchange Commission (SEC) requirements for certain NI 51-101 reserves disclosures. This exemption expired on December 31, 2010. As a result, the 2010 reserves disclosure is presented in accordance with Canadian reporting requirements using forecast prices and escalated costs. The recovery and reserves estimates of crude oil, NGL and natural gas reserves provided in this presentation are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual crude oil, NGL and natural gas reserves may be greater than or less than the estimates provided. Reserves estimates provided in this presentation are company gross, before royalties. Resources Other Than Reserves The contingent resources other than reserves (resources) estimates provided in this presentation are internally evaluated by qualified reserves evaluators in accordance with the COGE Handbook as directed by NI 51-101. No independent third party evaluation or audit was completed. Resources provided are best estimates as of December 31, 2010. The resources are evaluated using deterministic methods which represent the expected outcome with no optimism or conservatism. Resources, as per the COGE Handbook definition, are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from know accumulations using established technology or technology under development, but are not currently considered commercially viable due to one or more contingencies. There is no certainty that it will be commercially viable to produce any portion of these resources. Due to the inherent differences in standards and requirements employed in the evaluation of reserves and contingent resources, the total volumes of reserves or resources are not to be considered indicative of total volumes that may actually be recovered and are provided for illustrative purposes only. Petroleum, bitumen or natural gas initially-in-place volumes provided are discovered resources which include: production, reserves, contingent resources and unrecoverable volumes. Special Note Regarding non-GAAP Financial Measures Management's discussion and analysis includes references to financial measures commonly used in the oil and gas industry, such as cash flow, cash flow per share and EBITDA (net earnings before interest, taxes, depreciation depletion and amortization, asset retirement obligation accretion, unrealized foreign exchange, stock-based compensation expense and unrealized risk management activity). These financial measures are not defined by generally accepted accounting principles (GAAP) and therefore are referred to as non-GAAP measures. The non-GAAP measures used by the Company may not be comparable to similar measures presented by other companies. The Company uses these non-GAAP measures to evaluate the performance of the Company and of its business segments. The non-GAAP measures should not be considered an alternative to or more meaningful than net earnings, as determined in accordance with Canadian GAAP, as an indication of the Company's performance. Volumes shown are Company share before royalties unless otherwise stated.

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THE FUTURE CLEARLY DEFINED

Canadian Natural Resources Limited
2500, 855 - 2 Street SW Calgary Alberta T2P 4J8 phone: 403.517.6700 fax: 403.517.7350 email: ir@cnrl.com www.cnrl.com

Premium Value

Defined Growth

Independent