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Michael J. Monea, President, Carbon Capture & Storage Initiatives Address: 2025 Victoria Avenue, 12C Regina, Saskatchewan Canada S4P 0S1 Phone (306) 566-3132 Fax (306) 566-3931 Email: mmonea@saskpower.com

RE: SaskPower CCS Global ConsortiumTM- A world leading opportunity SaskPower is developing the world’s largest commercial-scale, coal-fired carbon capture and storage (CCS) facility at Boundary Dam Power Station in Estevan, Saskatchewan, Canada. The construction on the capture facility began in May 2011 and as of August 2013 is 90% complete. The facility is expected to be in commercial operation April of 2014 at which point it will become the first ever commercial-scale, post-combustion CCS demonstration project on a coalfired power station in the world. The Boundary Dam Integrated CCS Demonstration Project (BD ICCS) has created an unprecedented opportunity for the global energy community and its stakeholders to secure comprehensive project knowledge that can inform future carbon capture and storage projects. To facilitate the knowledge sharing, SaskPower has established the SaskPower CCS Global ConsortiumTM initiative. The Consortium will play an important role in spreading the knowledge and expertise that SaskPower has gained from converting an existing coal-fired unit into a long-term producer of 110 megawatts of baseload energy integrated with post-combustion carbon capture technology. SaskPower is building the coal-fired power generation plant of the future, capable of reducing CO2 emissions by up to 90 per cent. The reduction in emissions will be approximately 1 million tonnes annually or the equivalent of removing 250,000 vehicles from Saskatchewan’s roads. The CO2 captured from the BD ICCS Demonstration Project will be used for both enhanced oil recovery and stored in a deep saline formation through the Petroleum Technology Research Centre’s Aquistore Project. In addition to the Consortium, SaskPower is leading the development of a Carbon Capture Test Facility at our Shand Power Station that will assist vendors in verifying and improving post-combustion technologies in a commercial setting. SaskPower is pleased to provide the attached prospectus for the SaskPower CCS Global ConsortiumTM initiative. Please contact Rhonda Smysniuk, Director of International Relations and Consortium today to find out how SaskPower can save up to 30% on its next CCS project, rsmysniuk@saskpower.com or +1 (306) 566-3078. Sincerely,

Mike Monea President, Carbon Capture & Storage Initiatives Saskatchewan Power Corporation


SaskPower CCS

Global ConsortiumTM Information Sheet About The Boundary Dam Integrated CCS Demonstration Project SaskPower is leading the way to make a viable technical, environmental and economic case for the continued use of coal. The Boundary Dam Integrated Carbon Capture and Storage Demonstration Project in Estevan, Saskatchewan, Canada is the world’s first and largest commercial coal-fired CCS project of its kind. The $1.24 billion government-industry partnership between the Government of Canada, Government of Saskatchewan, SaskPower and industry will see the full integration of a rebuilt coal-fired generation unit with carbon capture technology into the operation of a commercial power station, resulting in low-emission electricity and carbon dioxide (CO2) for enhanced oil recovery operations or storage in a deep saline formation. This world-leading project will transform the aging Unit #3 at Boundary Dam Power Station into a reliable, long-term producer of 110 megawatts (MW) of baseload electricity, while enhancing oil production and reducing greenhouse gas emissions by capturing approximately one million tonnes of CO2 per year.

Carbon Capture Facility as of May 2013 at SaskPower’s Boundary Dam site in Estevan, Saskatchewan

About The Consortium For SaskPower, CCS technology will contribute to a more sustainable approach to coal-fired power generation. For others interested in CCS it provides unprecedented access to a wealth of knowledge that will greatly enhance policy, research and technical expertise around the globe. The SaskPower CCS Global ConsortiumTM initiative will provide members exclusive access to a knowledge platform on integrated process design and expertise gained from the Boundary Dam Integrated CCS Demonstration Project. Based on the knowledge gained, preliminary estimates suggest that SaskPower could save 20 to 30 per cent on our next CCS project. SaskPower leaders, engineers and consultants have years of experience in determining the feasibility and performance of CCS technologies. Consortium members will have access to technical documents created by the SaskPower team. Benefits include significant savings and efficiencies in the critical areas of integrated process design, financial management, risk and regulatory issues, and technology selection processes.

saskpowerccsconsortium.com

SaskPower project team at the Boundary Dam site in Estevan, Saskatchewan


About SaskPower As the principal supplier of electricity in Saskatchewan, SaskPower serves almost 482,000 customers and manages $6.3 billion in assets. Our company operates three coal-fired power stations, seven hydroelectric stations, five natural gas stations and two wind facilities with an aggregate generating capacity of 3,513 MW. We also have power purchase agreements in place to provide us with a total available capacity of 4,094 MW. SaskPower maintains nearly 152,000 kilometres of power lines, 55 high voltage switching stations and 186 distribution substations.

Boundary Dam Power Station in Estevan, Saskatchewan

Contact: Tyler Hopson saskpowerccsconsortium.com Leader, Media Relations @SaskPowerCCS Customer Services SaskPower 11NE — 2025 Victoria Avenue Regina, SK S4P 0S1 Canada Disclaimer: This document is not intended to create legally binding obligations. thopson@saskpower.com The SaskPower CCS Global Consortium remains subject to approval and change. This document and the associated material is confidential and must not be reproduced, copied or otherwise disclosed or used without the express written consent of SaskPower. Participant access to and use of knowledge assets will be granted only pursuant to the terms and conditions of a participation agreement to be entered into between SaskPower and each Phone: 011+1+306-566-3167 participant. For greater certainty, knowledge assets shall remain the exclusive property of SaskPower and are the confidential information of SaskPower. Cell:© Saskatchewan 011+1+306-536-2886 Copyright Power Corporation. All Rights Reserved. 8280.12/Aug13


SaskPower CCS

Global ConsortiumTM Commercial Membership Overview The Consortium Commercial Membership provides your organization with real-world knowledge gained from integrating CCS technology with SaskPower’s coal-fired power generation. The investment you make through your SaskPower CCS Global Consortium™ fee also contributes to ongoing public acceptance and research initiatives.

Generation 1 and 2 CCS is an emerging technology. Projects that are made possible via government subsidy are known as Generation 1 projects. The SaskPower Boundary Dam Integrated Carbon Capture and Storage Demonstration Project is a good example, as its $1.24 billion investment is supported by a 20 per cent government subsidy. Projects that are financially viable without subsidy are known as Generation 2 projects. With the success and learning taking place on Boundary Dam Unit #3, SaskPower believes that the next CCS project will cost 20-30 per cent less and not require any subsidy. The highly sought-after Generation 2 knowledge gained from researching, designing and evaluating how to integrate CCS on Boundary Dam Units #4 and 5 may be offered, as available, through the Consortium’s Premium level membership. The table below provides a visual summary of the benefits associated with each membership.

Member Access Scope of Knowledge Sharing Access to Reporting via Secure Website Generation 1 Reports* - Boundary Dam Unit #3*** Executive Summary Full Technical Report****

Basic Membership

Intelligence Membership

Premium Membership

1 representative

1 representative

5 representatives

Generation 1*

Generation 1*

Generation 1 & 2**

4 / year ****

4 / year 2 / year****

4 / year 4 / year

Generation 2 Reports - Boundary Dam Units #4 and 5 (as available)***

Executive Summary

4 / membership

Full Technical Report

4 / membership

Best Practices Manual

Live Quarterly Project Updates - online Annual Operations Review with CEOs and Executives Annual Technical Symposium

• •

$0.5m / year

$1m / year

Participation in workshops on other collaborative projects***** Participation in online discussion forums Fee Structure over 4 years (2014 - 2018)******

• • • • • • $1.75m / year

* Generation 1 knowledge includes project learnings from integrating CCS with Boundary Dam Unit #3. ** Generation 2 may include knowledge gained from undertaking the pre-commitment engineering and design work necessary to approve integration of CCS with Boundary Dam Units #4 and 5 as available. *** Some restrictions apply to the information reported due to third-party confidentiality. **** The Basic and Intelligence Memberships will allow for individual purchase of detailed reports at an incremental fee. ***** Basic and Intelligence members may be invited to participate in select discussion forums. ****** Premium members may use a contribution-in-kind for a portion of their membership as agreed to with SaskPower.

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SaskPower CCS

Global ConsortiumTM Commercial Membership Overview Generation 1 - Report Topics

1. Project Planning 2. Business Case and Financials 3. Technology Selection 4. Commissioning 5. Technology: Integration and Implementation 6. Construction and Refurbishment 7. Performance Testing 8. Technology: Operation 9. Operations and Staffing 10. Performance of Facility

11. Occupational Health and Safety 12. Off-takers and Storage 13. Technology: Optimization 14. Cash Flows and Financials 15. Regulations, Approvals and Stakeholder Engagement 16. Best Practices in CCUS Manual

Generation 2 - Report Topics

1. Planning, Business Case and Financials 2. Pre-commitment Engineering and Design 3. Procurement, Construction and Estimates 4. Advanced Technology Integration

Commercial Membership SaskPower provides three levels of commercial membership to organizations that want to leverage the knowledge gained from a real, commercial-scale CCS project. Information and access varies depending on the amount of detail required — be it technical, operational, or financial. For organizations looking for an alternative entry point into membership with SaskPower, or that want to advance public acceptance in their region, please review the Associate Membership overview.

Basic Membership The Basic Membership provides your organization access to the general findings gained from integrating Boundary Dam Unit #3 with CCS technology. As a Basic Member your organization receives an executive summary of every project report and can purchase detailed technical reports for an additional fee. You are also invited to participate in the annual SaskPower CCS Symposium.

Intelligence Membership  he Intelligence Membership gives your organization access to the general findings gained from integrating Boundary Dam Unit #3 T with CCS technology, as well as detailed technical information on the topics of greatest interest to you. As an Intelligence Member, your organization receives an executive summary of every project report and two detailed technical reports every year (additional technical reports can be purchased for an additional fee). You are invited to participate in live quarterly updates about the project, the annual SaskPower CCS Symposium, and select special events with our partners that cover an array of topics related to the capture, utilization, and storage of CO2.

Premium Membership  he Premium Membership provides your organization with in-depth knowledge about how CCS technology was integrated and operated T on Boundary Dam Unit #3. It may also, as available, provide you with the Generation 2 knowledge gained from producing the precommitment engineering and design work that is essential for approving the subsidy-free integration of CCS on Boundary Dam Units #4 and 5. Information is provided via detailed technical reports, quarterly live updates via webinar, and an annual operations review for executive level member representatives. These membership benefits are in addition to the other benefits offered in the Intelligence Membership, such as the annual conference and special events with project partners. Premium members may negotiate a contributionin-kind component to offset their membership fee that advances a specific area of CCS research through a third party. ** To the extent that SaskPower is legally permitted to share this third-party research, it will do so.

Contract Membership will require entering into a standard contract with SaskPower. Knowledge assets shall remain the exclusive property of SaskPower and are the confidential information of SaskPower. Disclaimer: This document is not intended to create legally binding obligations. The SaskPower CCS Global ConsortiumTM initiative remains subject to approval and change. Copyright Š Saskatchewan Power Corporation. All Rights Reserved.

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2025 Victoria Avenue Regina, Saskatchewan Canada S4P 0S1

Re: SaskPower CCS Global Consortium™ - Letter of Intent SaskPower is developing the world’s largest commercial-scale integrated carbon capture and storage project at its Boundary Dam Power Station (the “BDPS ICCS Project”) near Estevan, Saskatchewan, Canada. Construction on the BDPS ICCS Project began in May 2011 and commercial operation is anticipated by April of 2014. The BDPS ICCS Project will transform the aging coal-fired Unit #3 at Boundary Dam Power Station into a reliable, long-term producer of 110 megawatts of base-load electricity. The BDPS ICCS Project will reduce CO2 emissions by up to 90%, with the post-combustion capture of one million tonnes per year. Consortium Program Through its work on the BDPS ICCS Project, SaskPower has developed, and will continue to develop, an inventory of knowledge assets (Knowledge Assets). A summary of the initial Knowledge Assets is attached. SaskPower is establishing a SaskPower CCS Global Consortium™ that would, for a participation fee, allow interested organizations to access and use the Knowledge Assets for research and other noncommercial purposes. SaskPower believes other organizations can learn from SaskPower’s work and experience through the consortium. Over time, the Participants may also contribute to the Knowledge Assets. Summary of Participation Agreement Details of the Participation Agreement are as follows: 

Access to Knowledge Assets – Through a secure site or other similar method, a Participant with an existing agreement would be allowed access, commensurate with its Membership Category, to: o

the initial Knowledge Assets

o

any ongoing updates to the Knowledge Assets

Initial Minimum Commitment – Participants would be required to commit to an initial four year term.

Participant Fee – The Participant would pay a participation fee, on an annual or one-time full payment basis, commensurate with its Membership Category, as follows: o o o

Basic ($2.0M) Intelligence ($4.0M) Premium ($7.0M)


In-Kind Contribution – If SaskPower and the Participant mutually agree, the Participant may make certain in-kind contributions to the Consortium in lieu of a specified portion of the Premium Membership Fee.

License Rights – SaskPower or its licensors would retain all ownership rights to the Knowledge Assets. Participants would receive a license to use the Knowledge Assets for internal research and other non-commercial purposes. If a Participant wished to obtain a commercial license, a royalty fee would need to be negotiated at that time.

Participation Agreement – Each participating organization would be required to sign a standard-form Participation Agreement with SaskPower.

Next Steps At this time, SaskPower would like to confirm organizations that intend to pursue a membership opportunity with the SaskPower CCS Global Consortium™. If your organization intends to pursue membership, please sign and share the membership preference below and return by no later than September 30, 2013 to: Michael Monea President, Carbon Capture & Storage Initiatives SaskPower 2025 Victoria Avenue, Regina, SK, Canada, S4P 0S1 It is important to note: 

This Letter of Intent is not intended to create legally binding obligations and is intended to obtain expressions of interest only.

The consortium is in the planning stages and remains subject to approval and change.

Participation is limited to organizations invited by SaskPower to participate.

This Expression of Interest and the associated material is confidential and must not be reproduced, copied or otherwise disclosed or used without the express written consent of SaskPower.


Thank you for attention to this letter and we look forward to hearing from you. Yours truly, SASKATCHEWAN POWER CORPORATION Per:______________________________________ Michael Monea, President, Carbon Capture & Storage Initiatives

I, the below-mentioned party hereby state my Intent to obtain the following membership:

Membership (Y/N)

Single/Annual Payment

In-Kind Contribution (Y/N)

Basic

N/A

Intelligence

N/A

Premium

(if yes, describe)

in the SaskPower CCS Global Consortium™ acknowledged this____ day of ___________, 2013.

Company Name

Per:

____________________________________

Per:

____________________________________


SaskPower CCS Global Consortium™ Initial Knowledge Assets Summary Journey with us as we employ commercially available carbon capture technology to develop the world’s first and largest integrated carbon capture and storage project, designed to capture 1 million tonnes of CO2 per year for use in enhanced oil recovery operations. Core Initial Knowledge Assets for Participants: Leading-Edge Technology Selection Process:     

Details of our novel two-stage technology selection process Going beyond traditional FEED to a full commercial proposal Risk assessment, including emissions risk Communicating optimization signals to vendors Key learnings around what commercial factors to consider when making technology selection

Process Technology:   

Information on the process line-up and technology vendors Learnings and technical information relating to every aspect of the project Which technology suppliers we selected – and why

Business and Regulatory:     

Our experience with integrated performance forecasts, capital and operating cost estimates How to assess project economics and the over-all business case Key learnings around emissions performance Process output and CO2 sales Our experience with the regulatory approval process

Future Knowledge Assets: We also plan to share with participants future learnings from our experiences during start-up and commissioning through to the lessons learned during commercial operation of the facility, if and to the extent they become available.

Bringing Boundary Dam to the World. ™ DISCLAIMER: Participant access to and use of Knowledge Assets will be granted only pursuant to the terms and conditions of a standard-form participation agreement between SaskPower and each Participant, which agreement is only under exploratory consideration at this time through expressions of interest from prospective Participants. Knowledge Assets shall remain the exclusive property of SaskPower and/or its third party licensors and are the confidential information of SaskPower.

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