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Reservoir Quality

The Clearwater Project’s lease area is situated over an extremely high-quality portion of the Middle McMurray Formation sands. The reservoir here not only greatly exceeds the key parameters needed for successful SAGD operations, it generally matches or exceeds published criteria for some of the industry’s premier SAGD projects.

The table below shows key technical parameters of the Middle McMurray at Clearwater alongside published data from Pad C of Suncor Energy Inc.’s MacKay River SAGD project:

Property	McKay	Clearwater	Unit
Bitumen gravity	8	8	°API
Net pay range	15-35	35-45	m
Reservoir depth	90-130	75-125	m
Base of Clearwater shale (cap-rock)	86	64	m
Porosity	32	32	%
Permeability – horizontal	6.4	3.9	Darcies
Permeability – vertical	3.4	2.9	Darcies
Saturation	80	80	%
Weight bitumen	14	15	%
Bitumen viscosity at T (res.)	1-3	1.5	centiPoise
Initial temperature	7	6	°C
Initial pressure	300-500	200-300	kPa

Clearwater is a strong analogue to MacKay River, considered one of the industry’s best-quality SAGD projects. Clearwater is slightly lower in permeability but considerably greater in net pay thickness and slightly higher in bitumen weight.

This high quality is not a certainty for oil sands projects. Although oil sands reservoirs are often considered essentially homogeneous, they are actually much more variable, containing pockets and laminates of other rock types, creating challenges to consistent SAGD operations. The estuarine channel at the Clearwater Phase I Project is virtually homogeneous, which is conducive to consistent SAGD well performance and reduces technical risks.

Clearwater’s positive reservoir characteristics have been confirmed through a thorough process of resource evaluation, including 60 core holes and numerous technical studies, creating a high degree of confidence in the company’s figures. The Phase I project area consists of mainly clean sands, with extremely high oil saturation, low water content, and minimal shale within the sands.