Fire Damage Limited at Muskeg River Mine

Preliminary indications are that the January 6, 2003 fire at the Muskeg River Mine did not cause significant damage to major process equipment or piping systems. Damage appears to be mainly limited to electrical cables in the solvent recovery area of the froth treatment plant. The current expectation is that related repairs will not materially impact the scheduled start of first synthetic crude oil production from the Scotford Upgrader. However, the extent of damage and required repairs has not yet been fully determined. The cause of the fire appears to have been a hydrocarbon leak in piping located near the train two solvent recovery unit (SRU-2). The hydrocarbon ignited and the resulting fire was quickly extinguished.

The train one solvent recovery unit (SRU-1), which has been in operation since December 29, 2002, appears to have sustained only minor damage. SRU-2, which has not yet been fully commissioned and was not operating at the time of the incident, incurred the most damage from the fire. The majority of the froth treatment plant received no damage.

Filling of the Corridor Pipeline and associated tankage has been suspended pending the re-start of train one.

The Athabasca Oil Sands Project is a joint venture of Shell Canada Limited (60 percent), Chevron Canada Limited (20 percent) and Western Oil Sands L.P. (20 percent).