MUSKEG RIVER OIL SANDS MINE

Royal Dutch Shell announced the successful start of production of a 100,000 barrels per day expansion of its oil sands operations in Alberta, Canada. The new Jackpine Mine will combine with existing production from the Muskeg River Mine to feed the Scotford Upgrader, which processes the oil sands bitumen – heavy oil – for refined oil products. Construction for an expansion of the Scotford Upgrader is underway, and will come on-stream in 2011. Shell Canada Energy is 60% owner and operator of the Athabasca Oil Sands Project along with Chevron Canada Limited (20%) and Marathon Oil Corporation (20%). Athabasca Oil Sands Project includes the Muskeg River Mine, Jackpine Mine and Scotford Upgrader.

The Phase 1 expansion is on track and is anticipated to begin operations in the 2010/2011 timeframe. The Phase 1 expansion includes construction of mining and extraction facilities at the Jackpine mine, expansion of treatment facilities at the existing Muskeg River mine, expansion of the Scotford upgrader and development of related infrastructure.

Operations were curtailed at the Scotford upgrader due to a mid-November fire. Maintenance work originally scheduled for the first quarter of 2008 was performed in conjunction with the necessary repairs. The Scotford upgrader returned to operation in late December.