Suncor Energy Inc.

Suncor Energy Inc.

April 25, 2006 00:00 ET

Suncor Energy settles business interruption insurance claim

All figures in Canadian dollars unless otherwise noted

Calgary, Alberta (April 25, 2006) — Suncor Energy Inc. reports that it has settled business interruption (BI) insurance claims related to a January 2005 fire at the company's oil sands facilities. The total amount of the BI settlement is approximately $980 million (US$830) of which approximately $385 million (US$330 million) will be recorded in income when first quarter results are released on May 4, 2006. Approximately $594 million (US$500 million) in BI proceeds were recorded in 2005. BI proceeds are before tax and Alberta Crown royalties.

"The settlement of our business interruption claims is a major milestone in the fire recovery," said Ken Alley, senior vice president and chief financial officer. "Suncor has worked hard from an operational and financial perspective to put the fire behind us. We committed to shareholders to return to full production by September 2005, to stay the course on our expansion plans, and to work diligently with insurers to settle our claim. With those three commitments largely met, we can now focus on our growth plans."

Suncor and its insurers are still working to settle a smaller claim related to property loss (PL) as a result of the fire. In 2005, the company received $115 million (US$95 million) in property loss insurance proceeds. Total PL claims are expected to be less than the full policy limits of approximately $290 million (US$250 million).

Suncor expects combined PL and BI insurance proceeds for 2005 and 2006 to total approximately $1.2 billion (US$1.0 billion), which significantly mitigates the financial impact of the fire.

This news release contains a forward-looking statement identified by the words "plans", "working", "expected", and similar expressions which are based on Suncor's current expectations, estimates, projections and assumptions made in light of its experiences and the risks, uncertainties and other factors related to its business. Actual events could differ materially as a result of changes to Suncor's plans and the impact of events, risks and uncertainties discussed in Suncor's current annual information form, annual and quarterly reports to shareholders and other documents filed with regulatory authorities.

Suncor Energy Inc. is an integrated energy company headquartered in Calgary, Alberta. Suncor's oil sands business, located near Fort McMurray, Alberta, extracts and upgrades oil sands and markets refinery feedstock and diesel fuel, while operations throughout western Canada produce natural gas. Suncor operates a refining and marketing business in Ontario with retail distribution under the Sunoco brand. U.S.A. downstream assets include pipeline and refining operations in Colorado and Wyoming and retail sales in the Denver area under the Phillips 66® brand. Suncor's common shares (symbol: SU) are listed on the Toronto and New York stock exchanges.

Suncor Energy (U.S.A.) Inc. is an authorized licensee of the Phillips 66® brand and marks in the state of Colorado. Sunoco in Canada is separate and unrelated to Sunoco in the United States, which is owned by Sunoco, Inc. of Philadelphia.

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