CDP. Module: Introduction. Page: W0. Introduction. CDP 2014 Water 2014 Information Request W0.1. Introduction

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1 CDP CDP 2014 Water 2014 Information Request Suncor Energy Inc. Module: Introduction Page: W0. Introduction W0.1 Introduction Please give a general description and introduction to your organization. In 1967, we pioneered commercial development of Canada's oil sands one of the largest petroleum resource basins in the world. Since then, Suncor has grown to become a globally competitive integrated energy company with a balanced portfolio of high-quality assets, a strong balance sheet and significant growth prospects. Near Fort McMurray, Alta., in the Athabasca region, Suncor extracts and upgrades oil sands into high-quality, refinery-ready crude oil products and diesel fuel. Across Canada and in Colorado, Suncor markets the company's refined products to industrial, commercial and retail customers. In Canada, our network of 1,500 Petro-Canada stations is one of the most customer-recognized, top-volume retailers in the country. We have refineries in Edmonton, Alta.; Sarnia, Ont.; Montreal, Que.; and Commerce City, Colo. Our Lubricants business is the largest producer of quality lubricant base stocks in Canada, with customers worldwide. In Western Canada, across the East Coast of Canada and internationally, Suncor explores for, develops and produces conventional oil and natural gas from both onshore and offshore developments. Suncor is also investing in clean, renewable energy sources. Suncor has six wind power projects in operation with a total capacity of 255 megawatts. These wind power projects are expected to result in the avoidance of approximately 500,000 tonnes of carbon dioxide annually. Suncor's St. Clair, Ont. ethanol facility, Canada s largest biofuels plant, has a current production capacity of 400 million litres per year. The ethanol is blended into our Petro-Canada gasoline and contributes to avoidance of up to 600,000 tonnes of CO2 emissions per year. 1

2 W0.2 Reporting Year Please state the start and end date of the year for which you are reporting data. Period for which data is reported Tue 01 Jan Tue 31 Dec 2013 W0.3 Reporting Boundary Please indicate the category that describes the reporting boundary for companies, entities, or groups for which water-related impacts are reported. Companies, entities or groups over which operational control is exercised W0.4 Exclusions Are there any geographies, facilities or types of water inputs/outputs within this boundary which are not included in your disclosure? No 2

3 W0.4a List of Exclusions Please report the exclusions in the following table Exclusion Please explain why you have made the exclusion Further Information 3

4 Module: Current State Page: W1. Context W1.1 Please rate the importance (current and future) of water quality and water quantity to the success of your organization Water quality and quantity Importance rating Please explain Direct use: sufficient amounts of good quality freshwater available for use across your own operations Direct use: sufficient amounts of recycled, brackish and/or produced water available for use across your own operations Indirect use: sufficient amounts of good quality freshwater available for use across your value chain Indirect use: sufficient amounts of recycled, brackish and/or produced water available for use across your value chain Vital for operations Vital for operations Important Important Water is an integral component of Suncor's operations to mine, upgrade, refine oil and gas products. The majority of water used is sourced from fresh water with the exception being off-shore operations. Suncor has been increasing the amount of water recycling/reuse at its major oil sands operating facility to the point where recycled water is greater than 50% of planned water use. Our Edmonton refinery's primary water supply is reused municipal wastewater effluent from the local treatment facility The most significant Indirect water use is related to ethanol production. Water used for the production of corn to feed our ethanol facility is the single largest indirect use of water. Given there are very few waterless (or water independent) manufacturing chains that support Suncor's value chain, it is important to evaluate the risk to Suncor. As water stewardship increases globally and companies move to reduce their water footprint, reuse water will continue to grow across our value chain. W1.2 Have you evaluated how water quality and water quantity affects /could affect the success (viability, constraints) of your organization's growth strategy? Yes, evaluated over the next 10 years 4

5 W1.2a Please explain how your organization evaluated the effects of water quality and water quantity on the success (viability, constraints) of your organization's growth strategy? Suncor uses a risk based approach for understanding the effects of water quality and quantity on our organization s strategy. This process has used the following components: 1. Assessment of watershed and stress index; 2. The context of our operations as a component of the watershed and our water licenses; 3. Long range (10 year) growth plan that included water use forecasting and water cost per/m3 of use; and 4. Evaluation of growth related water demand versus water sustainability goals (current and future) over 10 year period. W1.2b What is the main reason for not having evaluated how water quality and water quantity affects /could affect the success (viability, constraints) of your organization's growth strategy, and are there any plans in place to do so in the future? Main reason Current plans Timeframe until evaluation Comment W1.3 Has your organization experienced any detrimental impacts related to water in the reporting period? Yes 5

6 W1.3a Please describe the detrimental impacts experienced by your organization related to water in the reporting period Country River basin Impact indicator Impact Description of impact Overall financial impact Response strategy Description of response strategy Canada Canada Mackenzie Mackenzie Regulatory- Unclear and/or unstable regulations on water allocation and wastewater discharge Reputational- Negative media coverage Other: Brand damage Provincial and Federal government have not proactively addressed guidance or regulations around return of oil sands process affected water back to the watershed during operational or final closure. The uncertainty has not allowed operators to fully develop sustainable water management plans. Suncor has executed a tactical water strategy for oil sands operations based around reducing water use and reusing water optimized against a deterioration of circulating water quality. In 2013 Suncor experienced a series of small unplanned releases from our operation to watersheds. While in all cases there was no significant impact to the watersheds, there was significant negative media coverage. Financial impacts cannot be quantified at this time as this represents future risk. No financial impact could be observed with regards to market capitalization however, assessment of social media response indicated an impact to reputation. Engagement with public policy makers Engagement with other stakeholders in the watershed Suncor in coordination with other major operators have been having technical discussion at both federal and provincial level to drive progress on this issue. Suncor has moved to more proactive engagement with watershed stakeholders to ensure speed of information/transparency is increased. 6

7 W1.3b Please choose the option below that best explains why you do not know if your organization experienced any detrimental impacts related to water in the reporting period and any plans you have to investigate this in the future Primary reason Future plans Further Information 7

8 Module: Risk Assessment Page: W2. Procedures and Requirements W2.1 Please select the option that best describes your procedures with regard to assessing water risks and provide an explanation as to why this option is suitable for your organization Water is integrated into a comprehensive, company-wide risk assessment process incorporating direct operations only W2.1a You may provide additional information about your approach to assessing water risks here Suncor is on a path of maturity from water management to water stewardship. The process began in 2007 when Suncor established a publicly disclosed sustainability water goal and development of a water strategy for oil sands & in situ operations. The intent of the strategy was to ensure all Business Unit opportunities & risks were integrated for optimization of opportunities to improve our overall business and sustainability performance. The strategy lead to the development of a cohesive plan that is reviewed, approved, and executed by Oil Sands. While this strategy was reactive initially it has laid the foundation for transformation into a proactive platform. As Suncor has neared the end of the 2015 Water Goal period, Suncor has conducted a corporate-wide water risk assessment for all our operations. The assessment has been foundational to the development of a post 2015 sustainability water goal. 8

9 W2.2 Please state how frequently you undertake water risk assessments, what geographical scale and how far into the future you consider Frequency Geographic scale Timeframe Suncor completed its first comprehensive detailed water risk assessment for all operations in We are planning for bi-annual review/updates starting in 2015 and every 2 years after. Water risk will not change significantly for a basin on a year over year basis and mitigations to water risks tend to be long term solutions. In between major reviews, Suncor's Strategic Issues Management Process will capture and respond to rapid developing water risks. River basin For the Northern Alberta Athabasca River Basin, Suncor has developed tools and models looking forward to 2032 to allow us to understand water risks. The current time frame is based around the major milestone - end of the Millennium Mine. Suncor is continuing to develop more powerful water basin management tools that can simultaneously resolve both groundwater and surface water as well as climate change scenarios. W2.3 Please state the methods used to assess water risks Method IPIECA Global Water Tool for Oil & Gas Internal company knowledge 9

10 W2.4 Which of the following contextual issues are always factored into your organization's water risk assessments? Issues Choose option Please explain Current water availability and quality parameters at a local level Current water regulatory frameworks and tariffs at a local level Current stakeholder conflicts concerning water resources at a local level Current implications of water on your key commodities/raw materials Current status of ecosystems and habitats at a local level Estimates of future changes in water availability at a local level Estimates of future potential regulatory changes at a local level Estimates of future potential stakeholder conflicts at a local level Estimates of future implications of water on your key commodities/raw materials some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers For all sites current water quantity and quality at a site specific scale is understood. For all our operational sites which have an operating approval with limits with typically monthly and annual reporting to regulatory agencies. Suncor actively engages with stakeholders with regards to water resources and these issues/risks are part of identified risks. Operational changes to water systems at sites which trigger regulatory applications require stakeholder consultation as part of the review. Current operations are not in areas of water stress. A review of our supply chain did not categorize water as an issue. Future scenario planning that include climate change are being developed and may represent future risk, however current information/tools have limitations for long term predictions that must be improved. Suncor monitors and assess ecosystem impacts on a local level. For some operational sites there is greater more extensive basin impact monitoring. For example Athabasca River basin is being monitored by Joint Oil Sands Monitoring program and is spending $50M dollars monitoring impact on the ecosystem. To date there has been no significant impacts from oil sands development. Suncor has evaluated water availability using IPIECA Global Water Tool for Oil and Gas for almost all facilities that we operate. Suncor monitors future potential regulatory changes at the federal, provincial/state, municipal level to understand how these changes could impact operations. Suncor also monitors regulations in other jurisdictions and evaluates potential impacts, timing and risk. Suncor has stakeholder relations teams for all operating facilities that work to understand issues and impacts. This information is transferred into Suncor s risk assessment work. Future scenario planning that includes climate change as well are being developed and may represent future risk, however current information/tools have limitations for long term predictions that must be improved. An example of a long term tool includes water basin level 10

11 Issues Choose option Please explain Estimates of future potential changes in the status of ecosystems and habitats at a local level Scenario analysis of availability of sufficient quantity and quality of water relevant for your operations at a local level Scenario analysis of regulatory and/or tariff changes at a local level Scenario analysis of stakeholder conflicts concerning water resources at a local level Scenario analysis of implications of water on your key commodities/raw materials Scenario analysis of potential changes in the status of ecosystems and habitats at a local level Other some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers projections that include climate change scenarios. Suncor has actively monitored or supported monitoring efforts of changes within ecosystems and habitats. Examples include annual reporting, RAMP (regional aquatics monitoring program) and JOSM (Joint Oil Sands Monitoring). These programs are trying to assess changes in the system and predict future impacts in the watershed that would allow for adaptive management for the long term. Suncor has developed models and tools that allow it to understand available water quantity and quality at the local level. This analysis frequency involves some scenario analysis however; more sophisticated models/tools are being developed to capture basin level projections that would better inform local water risks. As Suncor identifies future potential regulatory or policy changes we do evaluate potential impact to our operations. An example would be a draft set of rules from the USEPA on wastewater streams from power generating facilities. These rules may eventually be applied to one of Suncor s Canadian operations. This scenario was included in a recent risk assessment. Suncor includes stakeholder scenarios with regards to water resources at the local level. These inputs are more difficult to estimate the impact and likelihood. Future scenario planning that include climate change are being developed and may represent future risk, however current information/tools have limitations for long term predictions that must be improved. An example of a long term tool includes water basin level projections that include climate change scenarios. Water basin level projections that include climate change scenarios are being developed at one of our operational sites. These tools are required to develop scenario of potential changes over decades. Near term scenarios (next 5 to 10 years) are examined based on current monitoring programs and indicate acceptable impact. 11

12 W2.4a Which of the following stakeholders are always factored into your organization's water risk assessments? Stakeholder Choose option Please explain Customers Employees Investors Local communities NGOs Other water users at a local level Regulators at a local level Statutory special interest groups at a local level Suppliers Water utilities/suppliers at a local level Other some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers some facilities/suppliers Not evaluated some facilities/suppliers Impact of reputation on Suncor's brands with regards to water has been evaluated as a component of the overall water risk assessment file. Suncor has included evaluation of employee impact on execution of water management on-site. This included aspects of roles and accountability, complexity and experience. Suncor investor or investment organizations (CERES) have been identified as stakeholders as part of our risk assessment framework. Using CERES as an example Suncor has had workshops on the development of our Post 2015 Sustainability Goals including water. Local communities have been identified and included in Suncor's water risk assessment for the majority of our major operational sites. NGOs have been identified and included in Suncor's water risk assessment for the majority of our major operational sites. Some other local water users have been identified as stakeholders that do not fall into the major categories. Regulators have been identified and included in Suncor's water risk assessment for the majority of our major operational sites. Outside of water risk assessment Suncor has extensive contact with regulators about all our operations. First Nations have been identified as key stakeholders and included in Suncor's overall water risk assessment. Water utilities/suppliers have been identified and included in Suncor's water risk assessment for the majority of our major operational sites. 12

13 W2.5 Do you require your key suppliers to report on their water use, risks and management? No W2.5a Please provide the proportion of key suppliers you require to report on their water use, risks and management and the proportion of your procurement spend this represents Proportion of key suppliers % Total procurement spend % Rationale for this coverage W2.5b Please choose the option that best explains why you do not require your key suppliers to report on their water use, risks and management Primary reason Please explain Other: Suncor has prioritized water risk assessments to ensure we are capturing the largest issues early and launching appropriate mitigation. Sustainability of our supply chain is under evaluation overall, however at this time we are not currently asking for information on supplier water use, risks and management as there are higher priority issues to address. Further Information 13

14 Module: Implications Page: W3. Water Risks W3.1 Is your organization exposed to water risks, either current and/or future, that could generate a substantive change in your business, operations, revenue or expenditure? Yes, direct operations only W3.2 Please provide details as to how your organization defines substantive change in your business, operations, revenue or expenditure from water risk Suncor uses an enterprise wide risk management system (ERM) to assess and define risk. Like most ERM systems it uses a matrix that determines the consequence of a risk and the likelihood. There are six (6) consequence and likelihood categories. The ERM assign risks a ranking from I to IV for economic, environmental and social. Social is further broken down into Health & Safety, Reputation and Regulatory with guidance. Suncor defines substantive risks that are risked rank at II or I; this translates into a number of different consequence-probability combinations that will not be listed here. To simplify defining substantive change for the purpose of this survey an economic value of $10M was used. 14

15 W3.2a Please complete the table below providing information as to the number of facilities in your direct operations exposed to water risks that could generate a substantive change in your business, operations, revenue or expenditure. Please also provide either the proportion of cost of goods sold, global revenue or global production capacity that could be affected across your entire organization at the river basin level Country River basin Number of facilities within the river basin exposed to water risk Reporting metric Proportion of chosen metric that could be affected within the river basin Canada Mackenzie 3 Canada Saint Lawrence 4 Canada Nelson 1 United States of America Canada Mississippi 1 Other: Atlantic Ocean 1 % global production capacity % global production capacity % global production capacity % global production capacity % global production capacity

16 W3.2b Please list the inherent water risks that could generate a substantive change in your business, operations, revenue or expenditure, the potential impact to your direct operations and the strategies to mitigate them Potential impact: Closure of operations Country Canada River basin Mackenzie Risk driver Regulatory-Unclear and/or unstable regulations on water allocation and wastewater discharge Description of impact There is currently a lack of clarity around regulatory requirements for return of oil sands process affected water (OSPW) back to the watershed during either operational phase or for final closure. The lack of certainty increases risk to long term closure plans and the ability to manage both quantity and quality of water during operational phase of the projects. Timeframe >6 years Likelihood Probable Magnitude of potential financial Medium impact Response strategy Engagement with public policy makers Costs of response Low strategy Details of strategy Suncor along with 6 other operators has been engaging both Federal and Provincial technical and policy leaders for 2.5 years to drive and costs discussion towards certainty of regulatory tools for water return to the environment. The cost of this effort is low. Suncor and the other operators through COSIA (Canadian Oil Sands Innovation Alliance) have also been executing projects that will provide technical input into development of policy framework. These projects include a Watershed wide substance load allocation tool to provide watershed management information for the Athabasca River Basin; Chronic effect benchmarks standard development; and understanding/development of technology/sector based effluent limits (Best Available Technology Economically Achievable - BATEA concepts). All this work is being developed jointly by the majority of the operators in the region. Suncor portion of the overall cost is less than $500k for these project. 16

17 Potential impact: Higher operating costs Country Canada River basin Mackenzie Risk driver Regulatory-Unclear and/or unstable regulations on water allocation and wastewater discharge Potential impact Higher operating costs Description of impact The main oil sands base plant had to reduce 130Mm3 of excess water contained in tailings ponds by 2018 without the option to be able to return the water back to the watershed. Timeframe 1-3 years Likelihood Highly probable Magnitude of potential financial High impact Response strategy Infrastructure investment Costs of response High strategy Details of strategy Suncor planned and developed a tactical water containment strategy that contains 3 phases of projects to reduce on site water in and costs tailings by 130 Mm3 by There are roughly 18 projects covered by the 3 phases that achieve the reduction in water. All of these projects reduce or reuse water on site. The cost for the containment strategy is ~400M dollars of infrastructure investment. There is also a tactical water quality strategy that is currently under development to address water quality impacts. While full definition of the risks of changing water quality on site is complete, the mitigation plans are still in development and are limited to a single aspect of the operation-upgrading. Costs have not been determined. Potential impact: Higher operating costs Country Canada River basin Saint Lawrence Risk driver Physical-Increased water stress Description of impact Montreal and Mississauga operations using the IPIECA Global Water Tool scored and respectively on mean annual relative water stress index. This indicates there is a greater potential for water related risks. The potential impact of these risks will likely translate to higher operational costs. Timeframe >6 years Likelihood Unknown Magnitude of Unknown potential financial impact Response strategy Other: Problem Definition Costs of response Low-medium strategy Details of strategy Suncor is undertaking a process that provides correct definition-assessment of this water risk. As this process progresses and costs understanding of the potential issues, the impact and mitigation will be determined. Costs associated with definition have been estimated at $2million for these two facilities. 17

18 Potential impact: Higher operating costs Country Canada River basin Nelson Risk driver Physical-Inadequate infrastructure Description of impact Edmonton Refinery uses disposal wells as the primary method to manage wastewater generated on site. There is both ongoing operational challenges and potential for regulatory issues that could impact the long term use of disposal wells at this site. This means the facility would require an additional investment in wastewater treatment technology that would allow for return of the water back to the river. Timeframe >6 years Likelihood Probable Magnitude of High potential financial impact Response strategy Other: Problem Definition Costs of response Low-medium strategy Details of strategy Suncor is undertaking a process that provides correct definition-assessment of this water risk. As this process progresses and costs understanding of the potential issues, the impact and mitigation will be determined. To date cost has been low and focused on understanding geo-environmental chemistry of the operational issues of the disposal wells. This work has been internal with costs being less than $500K Potential impact: Higher operating costs Country United States of America River basin Mississippi Risk driver Description of impact Timeframe Likelihood Magnitude of potential financial impact Response strategy Costs of response strategy Details of strategy and costs Physical-Increased water stress Commerce City refinery operation scored 4.0 on mean annual relative water stress index using the IPIECA Global Water Tool. This indicates there is greater potential for water related risks. The potential impact of these risks will likely lead to higher operating costs in the long term. 1-3 years Probable HIgh Other: Strategy Development Low-medium The Commerce City facility has been working to define and assess specific water risks at the facility. There has been ongoing technical work around changes to their operating permit with regards to metals discharge limits, piloting of potential technologies, and strategies around water quantity management that could be implemented. They have also engaged with the regulatory body to gain alignment on discharge limits for the watershed and internally working solutions with regards to an implementation strategy. Strategy development costs are estimated in the $1-2 million range. Implementation costs are in the order of $35 million. 18

19 W3.2c Please list the inherent risks that could generate a substantive change in your business operations, revenue or expenditure, the potential impact to your supply chain and the strategies to mitigate them Country River basin Risk driver Potential impact Description of impact Timeframe Likelihood Magnitude of potential financial impact Response strategy Costs of response strategy Details of strategy and costs W3.2d Please choose the option that best explains why you do not consider your organization to be exposed to water risks in your direct operations that could generate a substantive change in your business, operations, revenue or expenditure Primary reason Please explain 19

20 W3.2e Please choose the option that best explains why you do not consider your organization to be exposed to water risks in your supply chain that could generate a substantive change in your business, operations, revenue or expenditure Primary reason Please explain Risks exist, but no substantive impact anticipated Stated earlier in the survey, all organizations face supply chain water risks, as there are very few truly waterless manufacturing processes. In 2012, Suncor completed a Sustainability Risk assessment across the 13 categories of the Suncor Supply Chain. The risk assessment was based on different sustainability risks components as well as materiality, as measured by annual spend. None of the 13 category managers and their respective team identified "water use" as a top-three risk. W3.2f Please choose the option that best explains why you do not know if your organization is exposed to water risks that could generate a substantive change in your business operations, revenue or expenditure and discuss any future plans you have to assess this Primary reason Future plans Further Information 20

21 Page: W4. Water Opportunities W4.1 Does water present strategic, operational or market opportunities that substantively benefit/have the potential to benefit your organization? Yes W4.1a Please describe the opportunities water presents to your organization and your strategies to realize them Country or region Opportunity Strategy to realize opportunity Estimated timeframe Please explain Canada Canada Improved water efficiency Other: Innovation Suncor's tactical water strategy for oil sands and in situ has resulted in a major improvement in water efficiency. All the projects executed reduced water use or make large quantities of water available for reuse. Suncor has been a leader in improving collaboration among industry peers through organizations such as COSIA. Current-up to 1 year >6 years The improvement in water efficiency essentially allows Suncor to consistently use less than half of our annual water license allotment from the Athabasca River. Suncor's own water R&D as well as the technology sharing by 13 oil sands companies on water R&D is laying the foundation for further breakthroughs for the region on environmental performance. For water alone there have been 145 technology contributions with an estimated value of $184M. W4.1b 21

22 Please choose the option that best explains why water does not present your organization with any opportunities that have the potential to provide substantive benefit Primary reason Please explain W4.1c Please choose the option that best explains why you do not know if water presents your organization with any opportunities that have the potential to provide substantive benefit Primary reason Please explain Further Information 22

23 Module: Accounting Page: W5. Water Accounting (I) W5.1 Please report the total withdrawal, discharge, consumption and recycled water volumes across your operations for the reporting period Water use Quantity (megaliters) Total volume of water withdrawn Total volume of water discharged Total volume of water consumed Total volume of recycled water used

24 W5.2 For those facilities exposed to water risks that could generate a substantive change in your business, operations, revenue or expenditure, the number of which was reported in W3.2a, please detail which of the following water aspects are regularly measured and monitored and an explanation as to why or why not Water aspect % of facilities Please explain Water withdrawals- total volumes Water withdrawals- volume by sources Water discharges- total volumes Water discharges- volume by destination Water discharges- volume by treatment method Water discharge quality dataquality by standard effluent parameters Water consumption- total volume Water recycling/reuse-total volume Total water withdrawal volumes are measured and monitored at our operating facilities because: we are required to measure/report to regulators the water volumes we withdraw; we report our water withdrawal volumes annually to our Stakeholders in our Report on Sustainability to increase transparency with our Stakeholders; and, Suncor has publicly stated water goals that require us to track and report our withdrawal volumes in order to understand our progress toward achieving these water goals. Total water withdrawal volumes by source are measured and monitored at all of our operating facilities as we are required to report the volumes we withdraw from each source to the regulators where we operate. The total water discharge volumes are measured and monitored as we are required to report to the regulators the volume of water we discharge (return) back to the environment. Suncor also reports this volume annually to our stakeholders in our Report on Sustainability. The total water discharge volumes by destination are measured and monitored as we are required to report to the regulators the volume of water we discharge (return) back to the environment and where we discharge the water. The water discharge volumes by treatment method are both measured and monitored as we are required to report this information to the regulators. Suncor measures and monitors our water discharge quality effluent parameters as we are regulated in our operating approvals on the quality of water we discharge back to the environment. This requires that we analyze for specific parameters and report these results to the regulators on a monthly and/or annual basis. We also report effluent water quality annually to our stakeholders in the Suncor Report on Sustainability. Suncor measures and monitors our water consumption volumes for all of our facilities because we report these volumes annually to our stakeholders in our Report on Sustainability. Suncor also has publicly stated water goals so we measure and monitor these volumes to understand our progress toward achieving these goals. Suncor measures and monitors recycle/reuse volumes at Oil Sands and In Situ facilities as we are required to report this information to the regulators. 24

25 W5.3 Water withdrawals: for the reporting period, please complete the table below with water accounting data for all facilities included in your answer to W3.2a Facility reference number Country River basin Facility name Total water withdrawals (megaliters/year) at this facility How does the total water withdrawals at this facility compare to the last reporting period? Please explain the change if substantial Facility 1 Canada Mackenzie Oil Sands Higher Facility 2 Canada Mackenzie Firebag 490 Lower Facility 3 Canada Mackenzie Mackay River 390 Much higher Facility 4 Facility 5 Facility 6 Facility 7 Canada Canada Canada Canada Saint Lawrence Saint Lawrence Saint Lawrence Saint Lawrence Montreal Refinery Sarnia Refinery Mississauga Lubricants St. Clair Ethanol Plant 5350 About the same Much lower About the same About the same 15% increase in total water withdrawal compared to Although river water intake decreased in 2013 due to operational changes and projects to optimize recycle of Upgrading Industrial Waste Water and cooling pond water, there was more surface water diverted in 2013 compared to % decrease in total water withdrawal compared to 2012 as there was less industrial runoff at the site and the facility increased their average annual water recycling rate by 2.1% over 2012 which would result in less water withdrawal. 45% increase in total water withdrawal because we used more water for in situ reservoir steaming operations in 2013 relative to % decrease in total water withdrawal because the once through cooling water system was down in September to November for a planned maintenance outage. 25

26 Facility reference number Country River basin Facility name Total water withdrawals (megaliters/year) at this facility How does the total water withdrawals at this facility compare to the last reporting period? Please explain the change if substantial Facility 8 Facility 9 United States of America Canada Mississippi Other: Atlantic Ocean Facility 10 Canada Nelson Commerce City Refinery 2710 About the same East Coast Much higher Edmonton Refinery 4120 About the same The 2013 water withdrawal volume for this facility represents normal operating conditions. There was an increase in sea water withdrawal in 2013 compared to 2012 due to a planned extended off station turnaround in During the 2012 turnaround the platform was not in production thus the reduction in sea water withdrawal for that year. Further Information 26

27 Page: W5. Water Accounting (II) W5.3a Water withdrawals: for the reporting period, please provide withdrawal data, in megaliters per year, for the water sources used for all facilities reported in W5.3 Facility reference number Surface water Groundwater (renewable) Groundwater (nonrenewable) Municipal water Recycled water Produced/process water Wastewater Brackish/salt water Facility Facility Facility Facility Facility Facility Facility Facility Facility Facility

28 W5.4 Water discharge: for the reporting period, please provide the water accounting data for all facilities reported in W5.3 Facility reference number Total water discharged (megaliters/year) at this facility How does the total water discharged at this facility compare to the last reporting period? Please explain the change if substantive Facility Higher Facility 2 0 About the same Facility 3 10 About the same Facility About the same Facility Higher Facility About the same Facility 7 90 About the same Facility About the same Facility Much higher Facility About the same In 2012, outfalls from our discharge ponds were only open for one month of the year, so water that would have normally been discharged back to the environment was held on site. However, in 2013 the outfalls were open for 11 months of the year, thus resulting in a higher volume of water discharged back to the environment. More industrial runoff, in the form of precipitation, was collected on the site in 2013 compared to 2012; this water gets discharged back to the environment. This facility had an extended planned maintenance turnaround in 2012 so was not in production as usual. This resulted in less water being withdrawn and returned to the environment in 2012 compared to 2013 when it was business as usual. 28

29 W5.4a Water discharge: for the reporting period, please provide water discharge data, in megaliters per year, by destination for all facilities reported in W5.3 Facility reference number Surface water Municipal Treatment Plant Saltwater Injection for production/disposal Aquifer recharge Storage/waste lagoon Facility Facility 2 Facility 3 10 Facility Facility Facility Facility 7 90 Facility Facility Facility

30 W5.5 Water consumption: for the reporting period, please provide water consumption data for all facilities reported in W5.3 Facility reference number Consumption (megaliters/year) How does this compare to the last reporting period? Please explain the change if substantive Facility About the same Facility Lower Facility Higher Facility Higher Facility 5 0 Higher Facility About the same Facility About the same Facility About the same Facility Much higher Facility About the same Water consumption was lower in 2013 at Firebag in situ facility because we were in reservoir production phase in 2013 as compared to 2012 when we were in reservoir steaming phasewhich requires more water. Water consumption was higher in 2013 at Mackay River in situ facility as this facility was in reservoir steaming phase in which requires more water than production phase of operations. Water consumption was higher in 2013 at the Montreal Refinery, though there was no specific event to attribute the increase to. The variation may be due to a leak from the water network, or evaporative loss from drains, flares or from cooling tower. Missed reporting a portion of our water withdrawal in 2012 from non-process area runoff, thus our consumption appeared to be lower than usual in Water consumption was much higher at this facility in 2013 compared to 2012 due to a planned extended maintenance turnaround in 2012 which required less water than normal operations of the facility in

31 W5.6 For the reporting period, please provide any available water intensity values for your organization's products or services across its operation Country River basin Product name Product unit Water unit Water intensity (Water unit/product unit) Water use type Comment Canada Mackenzie oil Canada Mackenzie oil Canada Mackenzie oil Canada Canada Canada Canada United States of America Canada St. Lawrence St. Lawrence St. Lawrence St. Lawrence Mississippi Other: Atlantic Ocean oil oil oil oil oil oil Canada Nelson oil Other: m3 oil equivalents Other: m3 oil equivalents Other: m3 oil equivalents Other: m3 refined product Other: m3 refined product Other: m3 refined product Other: m3 oil equivalents Other: m3 refined product Other: m3 oil equivalents Other: m3 refined product Megaliters Megaliters Megaliters Megaliters Megaliters Megaliters Megaliters Megaliters Megaliters Megaliters Water use in operations Water use in operations Water use in operations Water use in operations Water use in operations Water use in operations Water use in operations Water use in operations Water use in operations Water use in operations There is a 2% decrease in water consumption intensity at Oil Sands in 2013 compared to There is a 15% decrease in our water consumption intensity at Firebag in 2013 compared to 2012 due to less steaming activities in There is a 45% increase in water consumption intensity at Mackay River compared to 2012 due to more steaming activities in Water consumption intensity at Montreal Refinery was 29% higher compared to Though there was no specific event to attribute the increase to in 2013, the variation may be due to a leak from the water network, or evaporative loss from drains, flares or from cooling tower. There was a 12% decrease in water consumption intensity at the Lubricants facility in 2013; There was a 6% increase in water consumption intensity in East Coast operations because there was an extended planned off station turnaround in 2012 thus lower water consumption in

32 W5.7 For all facilities reported in W3.2a what proportion of their accounting data has been externally verified? Water aspect % verification What standard was used? Water withdrawals- total volumes Water withdrawalsvolume by sources Water discharges- total volumes Water dischargesvolume by destination Water dischargesvolume by treatment method Water discharge quality data- quality by standard effluent parameters Water consumption- total volume Water recycling/reusetotal volume Not verified Not verified Not verified Not verified This data is assured by Deloitte & Touche LLP as part of the publication of Suncor's 2014 Report on Sustainability. The assurance statement issued by Deloitte & Touche LLP can be found here: This data is assured by Deloitte & Touche LLP as part of the publication of Suncor's 2014 Report on Sustainability. The assurance statement issued by Deloitte & Touche LLP can be found here: Water withdrawal data is assured by Deloitte & Touche LLP as part of the publication of Suncor's 2014 Report on Sustainability. In addition, all other water consumption data including total water discharge and recycling/reuse are also reviewed by Deloitte & Touche LLP. The assurance statement can be found here; Water withdrawal data is assured by Deloitte & Touche LLP as part of the publication of Suncor's 2014 Report on Sustainability. In addition, all other water consumption data including total water discharge and recycling/reuse are also reviewed by Deloitte & Touche LLP. The assurance statement can be found here - Water withdrawal data is assured by Deloitte & Touche LLP as part of the publication of Suncor's 2014 Report on Sustainability. In addition, all other water consumption data including total water discharge and recycling/reuse are also reviewed by Deloitte & Touche LLP. The assurance statement can be found here - Further Information 32

33 Module: Response Page: W6. Governance and Strategy W6.1 Who has the highest level of direct responsibility for water within your organization and how frequently are they briefed? Highest level of direct responsibility for water issues Frequency of briefings on water issues Comment Senior Manager/Officer Other: Process is in redevelopment In 2013 Suncor developed a new Strategic Issues Management Process (SIMP) for the purpose of enhancing communication to executive leaders. Issue Managers have been assigned to strategic risk areas and are paired with an Executive Leadership Team (ELT) Member. The issue manager is responsible for creating & maintaining briefing documents for their ELT member. This new process is being rolled out in W6.2 Is water management integrated into your business strategy? Yes 33

34 W6.2a Please choose the option(s) below that best explain how water has positively influenced your business strategy Influence of water on business strategy Please explain Alignment of public policy positions with water stewardship goals Exploration of water valuation practices Publicly demonstrated our commitment to water The oil sands operating companies have been working together for the past 2.5 years in the development of a water management framework with public policy makers to resolve regulatory uncertainty around water return guidelines for the industry We've been working to develop tools that would allow for water valuation. The goal is to be able to include a true value of water for all projects. Currently a value of water is assigned in project development costs, while this value is more than pumping and treatment costs, it is being set based on professional judgment not a comprehensive calculation. Suncor is also developing tools that look specifically at the trade-off between water and other environmental issues, i.e.energy/ghgs. Suncor established Sustainability goals back in 2007 and one is stated for Water. The publicly stated goal with a performance target has demonstrated our commitment to water. The current suite of goals expire in 2015, and Suncor has started the process for development of post 2015 goals late in 2012, that will continue to build on the progress made in water management and continue to align with our Mission, Vision, and Values. W6.2b Please choose the option(s) below that best explains how water has negatively influenced your business strategy Influence of water on business strategy Please explain Increased capital expenditure Suncor has had to increase its CAPEX and OPEX on water management. The tactical water strategy for oil sands has CAPEX in the range of $400M to reduce stored water on site by ~130 Mm3. While the development of the strategy has afforded Suncor opportunities for cost savings and innovation, the bottom line is that Suncor has increased expenditures. 34

35 W6.2c Please choose the option that best explains why your organization does not integrate water management into its business strategy and discuss any future plans to do so Primary reason Please explain W6.3 Does your organization have a water policy that sets out clear goals and guidelines for action? Yes, a publicly available company-wide water policy W6.4 How does your organization's water-related capital expenditure (CAPEX) and operating expenditure (OPEX) during the most recent reporting period compare to the previous reporting period? Water-related spending: % of total CAPEX during this reporting period compared to last reporting period Water-related spending: % of total OPEX during this reporting period compared to last reporting period Motivation for these changes Further Information For question W6.4, Suncor's accounting system is not setup organizationally to attribute CAPEX and OPEX figures to water from across the company that meets the definitions provided by CDP in the guidance document. As such, any numbers Suncor would produce would be an estimate subject to significant error and not useful for a year over year comparison. 35

36 Page: W7. Compliance W7.1 Was your organization subject to any penalties and/or fines for breaches of abstraction licenses, discharge consents or other water and wastewater related regulations in the reporting period? Yes, not significant W7.1a Please describe the penalties and/or fines for breaches of abstraction licenses, discharge consents or other water and wastewater related regulations and your plans for resolving them Facility name Incident description Financial penalty or fine Currency Incident resolution Sarnia Refinery Environmental Penalty Number 99 in the amount of $ was issued to Suncor Energy Products on March 18, 2013 due to an acute toxicity failure (greater than 50% mortality) for the 96-hour rainbow trout acute toxicity test on July 11, 2012 at process effluent control point CAD ($) Sarnia Refinery through incident investigation and root cause analysis has defined the problem and are working on solutions to correct the issue comprehensively. In the interim, we have a temporary treatment facility that has been put in place. Lessons learned will be applied at other applicable operating locations. W7.1b Please indicate the total of all penalties and/or fines for breaches of abstraction licenses, discharge consents or other water and wastewater related regulations as a percentage of total operating expenditure (OPEX) compared to last year About the same Further Information 36