2004 AUGUST 18 12 noon, CALGARY PUBLIC OFFERING OF CROWN OIL SANDS RIGHTS ENERGY PUBLIC OFFERING CONTROL COUNTS FOR 2004.08.18 From To Total Area LEASES: L0862 L0872 11 10,496.0000 ha. PERMITS: P0000 P0000 0 0.0000 ha. -------------------------- 11 10,496.0000 ha. PUBLIC OFFERING OF CROWN OIL SANDS RIGHTS (AVAILABLE ON INTERNET AT HTTP://WWW.ENERGY.GOV.AB.CA:) DEADLINE After 12:00 noon on 2004 August 18,offers to purchase oil sands leases and/or permits contained in this public offering will not be accepted. AMOUNT OF PAYMENT (Canadian Funds Only) 1. The total dollar offer should be stated in your bid letter. A breakdown of the Bonus, Fee and Rent is not required. 2. The annual rental is $3.50 per hectare or $50.00 whichever is the greater. The issuance fee is $500.00 per parcel. 3. The minimum acceptance offer is $2.50 per hectare (leases) and $1.25 per hectare (permits). 4. The department reserves the right to reject any bid. FORM OF PAYMENT 1. ELECTRONIC FUNDS TRANSFER (EFT). 2. Payment by cheque will be accepted if it meets the criteria for exception mentioned in Information Letter 99-3. 3. Companies and individuals that do not have a GST registration number are liable for payment of the Goods and Services Tax on various charges. All registrants must ensure that their GST number is provided in writing to Financial Services Branch @ Fax No. (780) 422-4281. HOW TO SUBMIT BIDS 1. The types of acceptable bids are BID TYPE I AND BID TYPE II. The type of bid and its format are identified in attachments to Information Letter 99-12. Bids may be rejected if they do not comply with these standards. 2. One envelope may contain more than one bid as long as they are for the same agreement type. 3. Bid(s) should be enclosed in a sealed envelope and clearly marked as follows: "2004 August 18, --- OIL SANDS LEASE BIDS" for Leases. 4. Bids should be deposited in the box marked "OIL SANDS BIDS", or handed or mailed to any person acting for the manager at either the Calgary address: - 3rd Floor, Monenco Place, 801-6 Avenue SW, T2P 3W2 or the Edmonton address - 7th Floor, Petroleum Plaza North Tower, 9945-108 Street, T5K 2G6. BIDS ARE ACCEPTED UNTIL 12:00 NOON ON THE PUBLIC OFFERING DATE. NO EXCEPTIONS. POINTS TO REMEMBER 1. It can take up to midnight on the day following the sale to see your funds debited from your bank account for an accepted offer. 2. Requestors of parcel(s) posted in a public offering are expected to bid on the posting(s). If the parcel(s) is not sold, the requestor will be charged a fee of $500.00 plus GST for each unsold parcel. 3. Effective January 01, 2000, all Oil Sands Agreements acquired include Solution Gas. Please refer to information letter 99-38 for the definition of Solution Gas and any other relevant information. ATTACHMENTS TO THIS PUBLIC OFFERING WHEN APPLICABLE APPENDIX 1 - Contains applicable Zone Designations (ZD's). APPENDIX 2 - Contains applicable Deeper Rights Reversion Zone Designations (DRRZD's). APPENDIX 3 - Contains applicable addenda and contracts also terms and conditions for acquisition of parcel(s) within Metis Settlements (See IL 92-19). RESULTS OF THIS PUBLIC OFFERING 1. Accepted offers will be published on 2004 August 19 at 9:00 a.m. at the two addresses shown under the section above entitled "HOW TO SUBMIT BIDS", and on the Internet. 2. All agreements are issued in accordance with the Mines & Minerals Act and its regulations. 2004 June 23 Steve Tkalcic - Director Operations EDMONTON, Alberta Oil Sands Development LEASE SCHEDULE OIL SANDS LEASES 2004, AUGUST 18 LEASE HECTARES LAND DESCRIPTION ----- -------- ---------------- --- COLD LAKE OS AREA --- L0862 256 (MTS000101-32-M002) 4-02-057: 4 OIL SANDS IN THE MANNVILLE GRP (DRRZD 4) ------------------------------------------------------------------------------------- L0863 256 (MTS000101-32-M002) 4-02-057: 5 OIL SANDS IN THE MANNVILLE GRP (DRRZD 4) ------------------------------------------------------------------------------------- L0864 192 (MTS000101-32-M002) 4-02-057: 6S,NE OIL SANDS IN THE MANNVILLE GRP (DRRZD 4) ------------------------------------------------------------------------------------- L0865 64 4-02-057: 6NW OIL SANDS IN THE MANNVILLE GRP (DRRZD 4) ------------------------------------------------------------------------------------- L0866 256 (MTS000101-32-M002) 4-02-057: 33 OIL SANDS IN THE MANNVILLE GRP (DRRZD 4) ------------------------------------------------------------------------------------- L0867 256 4-11-060: 9 OIL SANDS IN THE MANNVILLE GRP (DRRZD 4) ------------------------------------------------------------------------------------- L0868 512 4-06-061: 15;22 OIL SANDS IN THE MANNVILLE GRP (DRRZD 4) ------------------------------------------------------------------------------------- --- PEACE RIVER OS AREA --- L0869 768 5-19-083: 17;20;29 OIL SANDS BELOW THE TOP OF THE PEACE RIVER FM (DRRZD 40) TO THE BASE OF THE PEKISKO FM (DRRZD 174) ------------------------------------------------------------------------------------- L0870 3328 5-12-092: 15-21;28-33 OIL SANDS BELOW THE TOP OF THE PEACE RIVER FM (DRRZD 40) TO THE BASE OF THE PEKISKO FM (DRRZD 174) ------------------------------------------------------------------------------------- L0871 1536 5-12-092: 22;26;27;34-36 OIL SANDS BELOW THE TOP OF THE PEACE RIVER FM (DRRZD 40) TO THE BASE OF THE PEKISKO FM (DRRZD 174) ------------------------------------------------------------------------------------- L0872 3072 5-13-092: 25-36 OIL SANDS BELOW THE TOP OF THE PEACE RIVER FM (DRRZD 40) TO THE BASE OF THE PEKISKO FM (DRRZD 174) ------------------------------------------------------------------------------------- 11 10,496.00 HA TOTALS END APPENDIX 2 DEEPER RIGHTS REVERSION ZONE DESIGNATIONS APPLICABLE TO THE 2004, AUGUST 18 PUBLIC OFFERING NOTICE DRRZD: 4 ZONE: 2480 MANNVILLE GRP INTERVAL: 2,557.00 - 2,985.00 FEET KEY WELL: 00/06-16-041-08W4/0 LOG TYPE: INDUCTION ELECTRICAL ------------------------------------------------------------------------------------- DRRZD: 40 ZONE: 2280 PEACE RIVER FM INTERVAL: 3,760.00 - 4,008.00 FEET KEY WELL: 00/07-09-076-08W6/0 LOG TYPE: BOREHOLE COMPENSATED SONIC ------------------------------------------------------------------------------------- DRRZD: 174 ZONE: 6420 PEKISKO FM INTERVAL: 6,468.00 - 6,654.00 FEET KEY WELL: 00/10-27-067-22W5/0 LOG TYPE: ELECTRICAL ------------------------------------------------------------------------------------- END APPENDIX 3 ADDENDA AND CONTACTS APPLICABLE TO THE 2004, AUGUST 18 PUBLIC OFFERING NOTICE MTS000101-32-M002 LAND DESCRIPTION LEASE L0862 LEASE L0863 LEASE L0864 4-02-057: 6SP,NEP LEASE L0866 IS/ARE WITHIN A METIS SETTLEMENT. THE SUCCESSFUL BIDDER MUST ENTER INTO A DEVELOPMENT AGREEMENT WITH THE METIS SETTLEMENTS GENERAL COUNCIL AND THE AFFECTED SETTLEMENT THAT INCLUDES NEGOTIATED COMMITMENTS TO: 1. ENSURE THE PROTECTION OF THE ENVIRONMENT IN THE SETTLEMENT AREA IN ACCORDANCE WITH PROVINCIAL STANDARDS AND SETTLEMENT BYLAWS; 2. CONDUCT OPERATION IN A WAY THAT MAINTAINS THE SOCIAL AND CULTURAL ORDER OF THE SETTLEMENT AREA AND CONFORMS WITH THE DEVELOPMENT PLANS AND LAND USE RESTRICTIONS ESTABLISHED BY THE SETTLEMENT COUNCIL; 3. EMPLOY, TRAIN, AND PROVIDE BUSINESS OPPORTUNITIES TO SETTLEMENT MEMBERS, TO AN EXTENT THAT IS PRACTICAL, DURING THE CONSTRUCTION, OPERATION, RECLAMATION AND ABANDONMENT PHASES OF ITS OPERATIONS IN THE SETTLEMENT AREA; 4. PAY APPLICABLE SETTLEMENT LICENCE FEES AND TAXES; 5. PROVIDE FAIR AND REASONABLE COMPENSATION FOR SURFACE ACCESS AND DAMAGES INCLUDING INFRASTRUCTURE DAMAGE, TIMBER LOSS, AND OTHER SPECIAL DAMAGES; 6. RECOGNIZE THE GENERAL COUNCIL'S RIGHT TO AN OVERRIDING ROYALTY AND 25% PARTICIPATION OPTION AS PROVIDED FOR IN THE CO-MANAGEMENT AGREEMENT (SCHEDULE 3 OF THE METIS SETTLEMENTS ACT); 7. ADHERE TO THE PROCEDURES CONTAINED IN THE CO-MANAGEMENT AGREEMENT AND INFORMATION LETTER 92-19; 8. THE SUCCESSFUL BIDDER WILL BE REQUIRED TO SIGN AN AGREEMENT IN THE FORM OF THE MASTER DEVELOPMENT AGREEMENT, THE TEMPLATE OF WHICH IS AVAILABLE FROM THE GENERAL COUNCIL UPON REQUEST. PLEASE NOTE: UNDER THE MASTER DEVELOPMENT AGREEMENT, THE SUCCESSFUL BIDDER WILL BE A JOINT VENTURE PARTNER WITH THE METIS SETTLEMENTS GENERAL COUNCIL. FURTHER INFORMATION CAN BE OBTAINED BY CONTACTING SUSAN LADOUCEUR, POSTING COORDINATOR FOR THE METIS SETTLEMENTS GENERAL COUNCIL AT (780) 822-4096. POTENTIAL BIDDERS SHOULD NOTE THAT FURTHER INFORMATION AND DETAILS REGARDING THE ABOVE TERMS AND CONDITIONS WILL BE AVAILABLE ON JUL 07, 2004. SURFACE ACCESS IS SUBJECT TO SPECIFIC RESTRICTIONS FOR FURTHER INFORMATION, PLEASE CONTACT: SUSAN LADOUCEUR METIS SETTLEMENTS GENERAL COUNCIL 10335 172 ST NW SUITE 200 EDMONTON AB T5S 1K9 (780) 822-4059 ------------------------------------------------------------------------------------- END