Alberta Energy Regulator Responds to Reports on the Cause of Bitumen Releases at CNRL's Primrose Project

CALGARY, ALBERTA--(Marketwired - July 22, 2014) - The Alberta Energy Regulator (AER) has released the results of an independent technical review of the Canadian Natural Resources Limited (CNRL) causation report into the 2013 bitumen flow-to-surface (FTS) incidents at the east and south sections of CNRL's Primrose project and concurs with the main contributing factors.

Four FTS incidents have been reported to the AER since May 2013 and AER-imposed restrictions on steaming activity at Primrose East and within one kilometre of Primrose South have been in place since June 2013. About 1180 cubic metres of bitumen emulsion has been recovered from the four sites, and the area affected is about 20.7 hectares. The bitumen release has been contained. Cleanup efforts are ongoing.

On June 27, 2014, CNRL provided the AER with a causation report that identified four conditions that enabled or significantly increased the probability of an FTS event. The AER has completed a preliminary review of both the CNRL report and the independent technical review of CNRL's report and has determined that the enabling factors fall into two main areas: the steaming strategy used by CNRL and wellbore issues.

The independent technical review indicated that CNRL's strategy to inject large volumes of steam at fracture pressure in closely spaced wells was a fundamental cause of the FTS incidents.

"Our assessment of the reports leads us to believe that these flow-to-surface events can be prevented if proper mitigation measures are put in place," said president and CEO Jim Ellis. "That said, the AER is not prepared to approve a return to full operations at these sites until all potential risks are addressed and proper requirements are in place to avoid a similar incident. This will require a gradual, step-by-step approach that allows us to manage those risks."

The AER's investigation is ongoing. CNRL and the panel that conducted the independent technical review continue to collect and analyze data and will submit final reports to the AER in September 2014 once all the data have been analyzed.

Copies of the current reports can be found at http://aer.ca/compliance-and-enforcement/cnrl-primrose

The AER ensures the safe, efficient, orderly, and environmentally responsible development of hydrocarbon resources over their entire life cycle. This includes allocating and conserving water resources, managing public lands, and protecting the environment while providing economic benefits for all Albertans.

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The Alberta Energy Regulator (AER) has released the results of an independent technical review into the causes of the 2013 bitumen flow-to-surface incidents at the east and south sections of Canadian Natural Resource Limited's Primrose project. The AER concurs that the main contributing factors were the steaming strategy used by Canadian Natural Resources Limited and wellbore issues. While the AER examines what measures can be put in place to prevent similar incidents, steaming restrictions at the four sites remain in place. The AER investigation is ongoing.