Summary Report: Environmental Impact Assessment Table of Contents April 2010

Table of Contents

1 INTRODUCTION...... 1-1 1.1 JAPAN CANADA OIL SANDS LIMITED ...... 1-1 1.2 EXISTING SAGD DEMONSTRATION PROJECT ...... 1-2 1.3 PROPOSED EXPANSION PROJECT...... 1-2 1.4 ENVIRONMENTAL IMPACT ASSESSMENT...... 1-2 1.5 SUMMARY REPORT...... 1-3

2 ASSESSMENT SUMMARY...... 2-1

List of Tables

Table 2-1 Summary of Environmental Effects...... 2-1

List of Figures

Figure 1-1 Regional Map with JACOS Expansion Project Area...... 1-5 Figure 1-2 Expansion Project Area and Project Footprint...... 1-7 Figure 1-3 Hangingstone Expansion Project Process Flow Diagram ...... 1-9 Figure 1-4 Local and Regional Study Areas...... 1-11

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Summary Report: Environmental Impact Assessment Selected Abbreviations and Acronyms April 2010

Selected Abbreviations and Acronyms

AAAQG...... Alberta Ambient Air Quality Guideline AAAQO...... Alberta Ambient Air Quality Objectives AENV...... Alberta Environment ASRD ...... Alberta Sustainable Resource Development COPC ...... Chemicals of Potential Concern CPF ...... Central Processing Facility EIA...... Environmental Impact Assessment HHERA...... Human Health and Ecological Risk Assessment JACOS ...... Japan Canada Oil Sands LSA...... Local Study Area PAI...... Potential Acid Input RMWB...... Regional Municipality of Wood Buffalo ROW...... Right-of-Way RSA ...... Regional Study Area SAGD ...... Steam Assisted Gravity Drainage TEK ...... Traditional Ecological Knowledge TLU...... Traditional Land Use WBEA...... Wood Buffalo Environmental Association

iii Summary Report: Environmental Impact Assessment Section 1: Introduction April 2010

1 INTRODUCTION

1.1 Japan Canada Oil Sands Limited

JACOS is a 100% owned Canadian subsidiary of Canada Oil Sands Co., Ltd. (CANOS), a Japanese subsidiary of Japan Petroleum Exploration Co., Ltd. (JAPEX). JAPEX is a petroleum exploration and production company and is traded on the Tokyo Stock Exchange (Securities Code Number 1662). JACOS started in the Athabasca area in 1978 when the company "farmed in" on leases held by Petro- Canada, Canadian Occidental (Nexen Inc.) and Esso (Imperial Oil) to form what is referred to as the PCEJ group. All of these companies are currently active in pursuing oil sands development in the region.

JACOS and its partners experimented with a cyclic steam stimulation pilot project on the Hangingstone Lease from 1983 to 1994. From 1992 to 1997, JAPEX participated in the AOSTRA Steam Assisted Gravity Drainage (SAGD) pilot experiments at the UTF (Underground Test Facility) site.

JACOS holds the rights to leases covering approximately 46,000 ha in the Athabasca region for future development. These leases include the Hangingstone, Chard, Corner, Liege and Thornbury areas which are expected to contain approximately 1.7 billion barrels of recoverable bitumen resource.

For more information about JACOS, visit the website at www.jacos.com. The proponent’s address and Project contact are as follows:

Japan Canada Oil Sands Limited. 2300 Standard Life Building 639 – 5th Avenue SW Calgary, Alberta T2P 0M9 Canada

General Project Communication: Mr. Brian Harschnitz Senior Vice President Japan Canada Oil Sands Limited Tel: (403) 668-5443/ Fax: (403) 668-5202 Email: [email protected]

Technical Project Communication: Mr. David Schleen Project Director Japan Canada Oil Sands Limited Tel: (403) 213-8981/ Fax: (403) 668-5202 Email: [email protected]

1-1 Summary Report: Environmental Impact Assessment Section 1: Introduction April 2010

Regulatory and Environmental Communication: Mr. Enzo Pennacchioli Manager, Regulatory Affairs Japan Canada Oil Sands Limited Tel: (403) 668-5155/ Fax: (403) 668-5202 Email: [email protected]

1.2 Existing SAGD Demonstration Project

JACOS currently operates a SAGD demonstration project in the Hangingstone area approximately 50 km southwest of Fort McMurray, Alberta in Township 84, Range 11 W4M. The Demonstration Project is in its eleventh year of operation of a projected 25 year lifespan. The facility started producing bitumen in July 1999 and production has increased to its current level of about 7500 bpd (barrels per day). The licensed maximum capacity is 11 000 bpd.

1.3 Proposed Expansion Project

In 2001, JACOS proposed the development of a commercial project just south of the Demonstration Project and commenced Environmental Impact Assessment (EIA) work and conceptual engineering. That proposed project was put on hold prior to filing for approval while the company underwent a significant change in its ownership structure.

In May of 2008, JACOS issued a new project disclosure document for public review and comment. The details of the Expansion Project, as described in this Application, are similar to what was originally disclosed in 2001 but there are sufficient differences to require completion of a new EIA and Commercial Application package.

Figure 1-1 provides an overview of the location of the Expansion Project area within the MD of Wood Buffalo. Figure 1-2 shows the extent of the planned project footprint within the overall Expansion Project area. Figure 1-3 shows a Process Flow Diagram for the Expansion Project.

1.4 Environmental Impact Assessment

An Environmental Impact Assessment (EIA) has been prepared by JACOS and its consultants as part of the environmental review of the Expansion Project by regulatory agencies (Alberta Environment [AENV] and Energy Resources Conservation Board [ERCB]), which is required before any approvals for the development may be granted. The EIA’s contents meet the information requirements of AENV’s Terms of Reference (ToR).

The EIA is the second volume, Volume 2, of the Commercial Application for the Expansion Project. Volume 1 is the Project Description. Sections 5 to 20 of Volume 2 provide the assessment for each of the assessed valued environmental components (VECs). VECs include biophysical and human/societal aspects of the environment that may be affected by the Expansion Project, and may be assessed with available information and analytical methods.

1-2 Summary Report: Environmental Impact Assessment Section 1: Introduction April 2010

The methods used to complete this assessment, described in detail in Volume 2, Section 2, follow approaches as established in previous such assessments for similar proposed projects in the Athabasca Oil Sands. The following three aspects of the method are important in the assessment of all VECs:

1. Assessment Cases: an assessment “case” is a point in time used to assess and compare effects. The effects of the Expansion Project have been assessed for three cases:

i. Baseline Case (includes past and existing conditions and existing and approved projects)

ii. Application Case (includes the Baseline Case with the Expansion Project)

iii. Planned Development Case (includes baseline and application case projects and projects that are announced or under regulatory review)

2. Project Phases: effects were assessed for three project phases: construction, operation, and decommissioning and reclamation.

3. Study Areas: local study areas (LSAs) and regional study areas (RSAs) are used for each assessed VEC. Figure 1-4 provides a compilation of these areas, each of which are described in more detail in the individual VEC sections in Volume 2.

Accidental events, such as spills, gas releases, forest fires and explosions have the potential to cause significant effects. However, the project design, using Best Available Technology Economically Available (BATEA) and preventive measures in place, indicate the likelihood of such events is low. JACOS is committed to designing, constructing and operating the Expansion Project in a safe and environmentally sound manner. The Emergency Response Plan in place for the Demonstration Project will be modified for application at the Expansion Project, providing protocols for addressing accidents, malfunctions and unplanned events, should they occur.

1.5 Summary Report

The major findings and conclusions of the EIA are presented in Section 2 of this Summary Report. This section summarizes the EIA’s findings, for normal project construction and operations, for each of the following assessed VECs:

 Air Quality

 Noise

 Hydrogeology

 Hydrology

 Surface Water Quality

 Fish and Fish Habitat

 Terrain and Soils

 Vegetation and Wetlands

1-3 Summary Report: Environmental Impact Assessment Section 1: Introduction April 2010

 Wildlife

 Biodiversity and Fragmentation

 Land and Resource Use

 Visual Aesthetics

 Historical Resources

 Traditional Ecological Knowledge and Land Use

 Human and Ecological Health

 Socio-economics

The following information is provided for each VEC:

 Assessment method: describes the analytical approach taken to identify and assess potential effects

 Key Issues: identifies the potential or known concerns relevant to the Expansion Project

 Environmental Setting: provides a general description of environmental (or “baseline”) conditions, including natural and human

 Project Components: describes the specific Expansion Project engineering design components that will or may result in effects

 Effects Management: describes the measures to be taken to minimize potential effects, including mitigation and monitoring

 Residual Effects: describes the effects, and their significance, after the application of effects management measures

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XY XY XY XY XY XY XY XY 5 Twp. 89 Rge. 4 Rge. W4 76 77 78 79 80 81 82 83 84 85 86 87 88 3 2 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

2 ASSESSMENT SUMMARY

Table 2-1 provides the summary of the EIA results for Expansion Project construction and operations. No significant effects were concluded for any VECs. This means that all predicted Expansion Project effects are not anticipated to be of concern following, as applicable, the application of the mitigation measures described.

Table 2-1 Summary of Environmental Effects

Air Quality

Assessment The Air Quality assessment: Method  assessed Baseline, Application and Planned Development Cases, and a unique “Project-Alone” scenario to help define the effects only from the Expansion Project.  provided data to assess potential effects of air quality on human and ecological health. Three main study areas were used: Modelling Domain A 290 km by 700 km area that encloses the Lower Athabasca Planning Region (LAPR). Emissions were defined for present and future sources in this area. Local Study Area A 110 km by 110 km area that includes the Expansion Project. The LSA includes industry and non- industry emission sources from the Fort McMurray region, including the City of Fort McMurray; the community of Anzac; and the Clearwater, Gregoire Lake, and Janvier Indian Reserves. Regional Study Area The RSA was chosen to address Potential Acid Input (PAI) deposition. As PAI is assessed on a 1° latitude by 1° longitude grid cell basis the RSA is based on multiples of this grid cell size. The RSA of two grid cells of latitude (56° to 58° N) by three grid cells of longitude (110° to 113° W) was selected. The RSA extent is biased to the region north of the Expansion Project in order to show the cumulative effects of the oil sands development emissions that are also biased to the north. A standard approach was used to assess air quality, which includes the following:  Identify and quantify atmospheric emission sources for each assessment case.  Review ambient air quality measurements in the region to provide an indication of existing conditions.  Review regional and local meteorology to determine transport and dispersion patterns in the region.  Review topography which influences meteorology and review land cover information which influences deposition.  Compare the ambient monitoring measurements and air quality predictions to the ambient air quality and deposition criteria, and identify the incremental air quality changes caused by the Expansion Project. This approach has been used for other air quality impact assessments for similar projects in Alberta. The Air Quality assessment followed the Alberta Environment Air Quality Model Guideline. The CALPUFF transport and dispersion model and the associated CALMET meteorology model were the primary tools used. Calculated air quality concentrations were compared to government air quality criteria, principally the Alberta Ambient Air Quality Objectives (AAAQO).

2-1 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Air Quality (cont’d)

Key Issues The Expansion Project will result in changes to the local air quality, which may have the potential to directly affect human health and vegetation, and indirectly affect aquatic and terrestrial systems. A full human health risk assessment evaluated the air quality changes in a more rigorous manner to determine the potential for adverse health outcomes. Greenhouse gas (GHG) emissions from the Expansion Project were calculated and compared to Alberta and Canada emissions. Visibility effects due to water vapour emissions were also evaluated.

Environmental Continuous ambient monitoring has been conducted in the Wood Buffalo Environmental Association Setting (WBEA) airshed at 14 locations: four of which are community locations, and ten of which are near industrial (i.e., oil sands) operations. The continuous monitoring is complemented by a network of 27 passive sampling sites that are located near existing oil sands operations, in urban centres, and in remote rural areas. The Expansion Project area, which is about 50 km southwest of Fort McMurray, is a considerable distance from this corridor and associated monitoring sites. While there are limited monitoring sites near the Expansion Project, WBEA ambient data have been examined to obtain an indication of air quality in the lease area, summarized as follows: 3  Ambient 1-hour Sulfur Dioxide (SO2) concentrations are expected to be in the 20 to 50 g/m range with occasional peaks in the 50 to 100 g/m3 range. These are less than the AAAQO of 450 g/m3. 3  Ambient 1-hour Nitrogen Dioxide (NO2) concentrations are expected to be in the 20 to 50 g/m range with occasional peaks in the 50 to 100 g/m3 range. These are less than the AAAQO of 400 g/m3.

 High Particulate Matter (PM2.5) concentration events are largely driven by forest fire events and these events can influence all regions and monitoring stations in the WBEA airshed.

 While high Ozone (O3) concentrations typically occur during the spring, high O3 concentration events can also occur during the summer. These latter events are influenced by forest fire and anthropogenic precursor emissions.

 High Hydrogen Sulfide (H2S) and Total Reduced Sulfur (TRS) concentrations occur near the existing mining and upgrading facilities north of Fort McMurray.  PAI deposition was inferred from measurements in the region using four different assumption approaches. The approaches that assumed nitrogen adjustment indicated an existing deposition between 0.05 and 0.11 keq/ha/y at the Expansion Project site. While high ambient concentrations associated with oil sands development emissions have been measured in the corridor north of Fort McMurray, the ambient concentrations near the Expansion Project are expected to be near remote background levels.

Project The Expansion Project will comprise numerous components over the Project’s life including about Components 175 well pairs in 26 well pads, steam boilers, heaters, electrical generators, flares, and storage tanks. These components can release SO2, NOX, Carbon Monoxide (CO), Volatile Organic Compounds (VOCs), Polycyclic Aromatic Hydrocarbons (PAHs) and PM2.5. Releases can occur from the boiler and heater stacks, which are the main sources of air emissions; or from storage tanks and process areas, which are classified as fugitive emissions (fugitive emission sources include valves, flanges, rotating seals, and drains). Smaller emissions can occur at the well pads.

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Table 2-1 Summary of Environmental Effects (cont’d)

Air Quality (cont’d)

Effects A number of design and mitigation measures have been planned for the Expansion Project to help Management control emissions during its operation, including:  heaters and boilers will be fired with natural gas, or fuel gas.  low-emission packing on control valves, seals, gaskets will be used to reduce fugitive emissions. A leak detection and repair (LDAR) program will be implemented to identify and reduce fugitive emissions.  vapour recovery on petroleum storage tanks  commitment to operate in a manner compliant with Canadian Council of Ministers of Environment (CCME) guidelines, including use of low-NOx burners.  energy efficiency technology to reduce GHGs

Residual The Expansion Project does not cause any exceedances of air quality criteria. Effects Air quality is the pathway between the emission source and the receptors that could potentially be affected by exposure due to these emissions. Effects have been determined by comparing the maximum ambient concentrations predicted in the LSA for each assessment case to the relevant ambient air quality criteria. The conclusions are as follows:

SO2 Concentrations  The Expansion Project will increase Baseline Case SO2 emissions by +0.87%.

 Highest predicted SO2 concentrations are within the Expansion Project Lease Area and decrease with increasing distance from the emission sources.

 Maximum SO2 concentrations due to the Expansion Project and other existing, approved or planned sources are lower than AAAQO for all assessment cases and averaging periods.

NO2 Concentrations  The Expansion Project will increase Baseline Case NOX emissions by +0.2%.

 Maximum NO2 concentrations predicted to be in the City of Fort McMurray (but less than the respective AAAQO).

 Maximum NO2 concentrations due to the Expansion Project and other existing, approved or planned sources are less than the respective AAAQO for all assessment cases and averaging periods.

PM2.5 Concentrations  The Expansion Project will increase Baseline Case PM2.5 emissions by +0.9%.

 Measured PM2.5 concentrations exceed the Alberta Ambient Air Quality Guideline (AAAQG) and the AAAQO but these were due to forest fire emissions and not due to industry or non-industry emissions.

 Maximum PM2.5 concentrations are predicted to be in the City of Fort McMurray; these maximum values are greater than the respective AAAQG and AAAQO.  No predicted AAAQO exceedances for any of the three assessment cases are due to the Expansion Project.

2-3 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Air Quality (cont’d)

Residual PAI Deposition  The Expansion Project will increase the Baseline Case PAI Effects (cont’d) precursor SO2 and NOX emissions by +0.87% and +0.2%, respectively.

 Expansion Project combined SO2 and NOX emissions are less than the threshold that indicates need for PAI modelling. Nonetheless, PAI modelling was undertaken given the interest in PAI deposition in the WBEA region.  The PAI deposition for the grid-cell where the Expansion Project is located is less than the most stringent loading criteria for the three assessment cases.

Nitrogen Deposition  The Expansion Project will increase the Baseline Case NOX emissions by +0.2%.  The area with predicted nitrogen deposition greater than 5.0 kg/N/ha/y for the Application Case increases by 0.11%.

Human Health and  For criteria substances (SO2, NO2 and PM2.5), CO, organic Odours substances (acetaldehyde, benzene, benzo(a)pyrene, ethylbenzene, formaldehyde, hexane, toluene and xylenes), trace metals (chromium, lead, manganese and nickel), the maximum predicted concentrations are less than the respective ambient criteria along the Expansion Project fenceline and at the other human health receptor locations.

 For Carbon Disulphide (CS2) and H2S, the maximum predicted CS2 and H2S concentrations are greater than the respective ambient criteria. The Expansion Project emissions do not contribute to the high CS2 or H2S concentrations that are predicted in Fort MacKay or Fort McMurray.

 Elevated concentrations of H2S are predicted along the Expansion Project Central Processing facility (CPF) fenceline, indicating a potential for odours. However there is low potential for odours at the closest trapper’s cabins, as the predicted values are less than the AAAQO for H2S.

O3 Concentrations  The Expansion Project O3 precursor NOX and VOC emissions relative to the Baseline Case increase by 0.46% and 0.087%, respectively.  As the Expansion Project precursor emissions are relatively small, they would not be expected to result in substantive increases in ozone concentrations within or downwind of the Wood Buffalo region.

Greenhouse Gas  The Expansion Project will be a source of GHG emissions (1,028 Emissions and Climate kt/y), which represents 0.42% of the provincial total and 0.14% of the national total.

 The Expansion Project GHG emission intensity (80 kg CO2e/bbl) falls within the range of the target intensities (70 to 110 kg CO2e/bbl) for the other facilities.  Potential future climate change may have an influence on the Expansion Project. Specific weather elements may influence construction and reclamation activities.

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Table 2-1 Summary of Environmental Effects (cont’d)

Air Quality (cont’d)

Residual Visibility  The Project will be a source of water vapour emissions, which Effects (cont’d) can condense and become visible under low temperature atmospheric conditions. On cold days when the water vapour emissions condense to form visible plumes and with neutral atmospheric conditions, predicted plume heights vary from about 450 m for low wind speeds to about 130 m for higher wind speeds.

Noise

Assessment The noise impact assessment was based on International Organization for Standardization Method Standard 9613 (ISO 9613) noise propagation modelling algorithms. Local Study Area In accordance with ERCB Directive 038: Noise Control, the Noise LSA was conservatively selected at 1.5 km from the perimeter of the CPF and wellpads. There are two trappers’ cabins located within the LSA (i.e., within the 1.5 km buffer around the perimeter of the project related noise sources including the CPF and wellpads). The dominant existing energy developments within the LSA are Plants 1 and 2 at the existing JACOS Demonstration Project located 4 km north of the Expansion Project. There are three other small potential sources of noise within or near the boundary of the LSA (one compressor station and one pump station within the LSA and one compressor station about 3 km east of the eastern-most boundary of the Noise LSA). These other noise sources are considered minor source whose noise footprint is not expected to extend beyond their fence lines. Regional Study Area Noise effects from the Demonstration Project were included in the cumulative effects assessment for completeness. The effect and geographic extent of noise is local and is expected to be restricted within the LSA due to the geometrical dissipation of sound levels with respect to increasing distance from the source. If Directive 038 noise limits are met within the 1.5 km LSA, they will be met at other receptor locations outside the LSA. The general approach used in assessing the noise effects during the operations of the Expansion Project includes: 1. identification of the contributing noise sources in the facility and well pads 2. characterization of these sources as acoustical power values 3. modelling of the sound propagation 4. comparison of total predicted project-alone scenario sound level at 1.5 km from the perimeter around the CPF and wellpads and at the two receptors within the LSA (i.e., ambient plus facility contributions) to the nighttime sound level limit of 40 dBA Leq(9). 5. If the predicted sound levels exceed the Directive 038 requirements, mitigation measures will be identified to meet the recommended sound level. The likelihood of low frequency noise effects resulting from the operation of the Project were also assessed according to Directive 038. Sound propagation from the Expansion Project was calculated using CadnaA incorporating ISO 9613 algorithms.

Key Issues The key noise issue is an increase in ambient sound levels during construction, well drilling, operations and decommissioning.

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Table 2-1 Summary of Environmental Effects (cont’d)

Noise (cont’d)

Environmental Activities affecting existing sound levels in the area include road traffic along Highway 63 and other Setting access roads, operations of the existing Demonstration Project, other human activities and nature sounds (e.g., wind noise).

Project As a conservative approach, all existing noise sources have been included in the modelling Components exercises. Noise from all the well pads was also included in the modelling for the duration of the Expansion Project. Spare or standby equipment that will be operated intermittently during upset conditions were not included in the noise model. At each pump location, noise from the pump and associated electrical motor was included.

Effects The Expansion Project will be designed to reduce noise during construction, drilling, operations and Management decommissioning. Construction JACOS plans to implement the following mitigation measures, as appropriate, to limit noise effects on the environment during construction and decommissioning, to the most practicable extent possible.  Where practical, construction activities that are known to create noise will be restricted to daytime hours of 07:00 to 20:00.  Piling activity is expected only to occur during the day.  Noise mitigation measures installed on construction equipment (e.g., mufflers) will be properly maintained.  Construction equipment will be turned off when not in use. Operation  In the event of a noise complaint, JACOS will review their Operations Log Book or other similar records to determine if there were operational conditions responsible for an increase in noise level.  If appropriate JACOS will conduct a noise evaluation to determine if the Expansion Project is the cause.  If the Expansion Project is identified as the cause of a noise complaint, mitigation measures will be identified and, where practical, implemented to reduce noise.  Planned flaring events will be scheduled during daytime hours (07:00 to 20:00) where reasonably practical. Traffic The level of noise created by vehicles will vary with speed, number and type of vehicle used. Noise levels from vehicles are expected to decrease as a factor of the distance from access roads. The following mitigation measures are planned to limit noise effects from project-related traffic:  Vehicle traffic will be restricted to approved access routes to and from the site.  Appropriate mufflers will be equipped on vehicles.  Vehicles will be routinely maintained and serviced to ensure suitable operation.  Project roads will be maintained to reduce noise associated with vibration.  Vehicle speed limits will be established for roads associated with the Expansion Project.

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Table 2-1 Summary of Environmental Effects (cont’d)

Noise (cont’d)

Residual The maximum predicted cumulative sound level at a distance of 1.5 km from the Expansion Project Effects during normal operations, together with the existing Demonstration Project, is 38 dBA Leq(9). As the predicted dBC-dBA value is 14 (well below ERCB limit of 20), the likelihood of low frequency noise effects from the Project is predicted to be minimal. Noise effects therefore from operation of the Expansion Project are predicted to be in compliance with Directive 038.

The predicted cumulative sound level at the two cabins in the LSA is 35 dBA Leq (9). The existing sound environment at three cabins outside the LSA is predicted to remain unchanged during the operations of the Expansion Project. Based on the noise management measures outlined and the absence of any human dwellings in the LSA, no effect on human dwellings within the LSA is expected. Outside the JACOS lease boundaries, the noise level from the Expansion Project is expected to be inaudible.

Hydrogeology

Assessment The LSA was determined by selecting a buffer zone around the Project Area that encompasses Method principal hydrogeological features, including an outwash/kame aquifer that was historically used for water supply by the JACOS Demonstration Project, and a buried tributary valley of the Leismer bedrock channel. Portions of Horse River, Horse Creek and Hangingstone River watersheds also exist within the LSA. The RSA was defined primarily by major recharge and discharge areas of the groundwater flow system that could potentially be affected by activities associated with the Expansion Project. Likely areas of groundwater-surface water interaction were also considered. The RSA boundaries extend from Township 80 in the south and are defined in the north by the Athabasca and Clearwater Rivers, and by the Athabasca River on the west and the Christina River on the east. The RSA is approximately 9500 km2. The method included:  quantitative and qualitative information on baseline groundwater conditions  publicly available data regarding existing and planned activities and development, including information about the size, nature, location and duration of their effects on groundwater resources  regional monitoring and mapping of groundwater resources.

KeyIssues Keyissuesincludeeffectsof:  groundwater diversion and use of steam chambers for disposal on change in groundwater quantity  groundwater diversion, drilling and installation of SAGD wells, leakage from casing failure from SAGD wells, operation of SAGD wells, use of steam chambers for disposal and leaks, releases and spills from production facilities and operations on change(s) in groundwater quality  groundwater diversion on change in Groundwater Flow Regime  groundwater diversion on change in Groundwater/Surface Water Interaction

2-7 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Hydrogeology (cont’d)

Environmental Surficial deposits within the RSA are primarily comprised of glacial and glacio-fluvial sediments. This Setting unconsolidated material is comprised of clay, silt, sand and gravel. In the lowland area, near the Athabasca and Clearwater Rivers, the thickness of the surficial deposits is only a few metres, but measures up to 250 m or more where the Leismer (Conklin) Channel traverses under the Stony Mountain Uplands. Locally, sand and gravel deposits of Empress Formation – Unit 3 and Muriel Lake Formation have been identified, residing below and above the Bronson Lake Formation, respectively. Beneath the Quaternary sediments, deposits of the Lower Cretaceous Mannville Group rest directly upon the eroded surface of the Devonian strata. These sediments are relatively uniform in thickness. The Mannville Group comprises the McMurray, Clearwater and Grand Rapids Formations. Post-Cretaceous erosional episodes have removed a considerable amount of strata from northeast Alberta. This removal of strata by erosion is especially evident along modern river systems. Most noteworthy for the RSA, the Athabasca River and the Clearwater River have both incised down to the Devonian unconformity along the northern boundary of the RSA near Fort McMurray. Within the LSA, there are two significant geological features that are considered relevant. These two features are the outwash/kame aquifer (sands and gravels deposit) located at the base of the Stony Mountain uplands and a southeast-northwest trending branch of the Leismer Channel in the southeast section of the LSA. As well, within the LSA, the most noteworthy aquifers from the surface down to the Cretaceous/Devonian contact have been identified as follows:  Muriel Lake Formation (unconsolidated sand and gravel)  Empress Unit 3 (unconsolidated sand and gravel)  Grand Rapids Formation (sandstone)  Clearwater Formation (sandstone and siltstone)  Wabiskaw Member (sandstone and siltstone); and,  Basal McMurray (sandstone). Within the LSA, significant aquitards have also been identified as follows:  Till formations throughout the Quaternary succession  Colorado Group - La Biche, and Joli Fou Formations (shales)  Clearwater Formation (shales)  Waterways Formation (shales)

Project Project components that may contribute to potential effects on groundwater include: Components  groundwater diversion during construction and operation phases  use of depleted steam chambers for disposal during operation phase  drilling and installation of SAGD wells during the construction phase  leakage from casing failure from SAGD wells during construction operation phase  operation of SAGD wells  leaks, releases and spills from production facilities and operation

2-8 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Hydrogeology (cont’d)

Effects Mitigation measures include: Management  monitoring of groundwater wells and if necessary, review of alternative options for water supply such as, increasing the number of source wells (i.e. developing a wellfield), relocating the source well(s) and/or diverting groundwater from an alternative aquifer.  Proper cement sealing to surface and across aquifers. As well, the appropriate mud-types and drilling techniques will be used to minimize loss of drilling fluids to the surrounding aquifers.  Engineering design and operational practices are put into place to mitigate any potential leakage and/or casing failure of SAGD wells. If an impact were to happen, emergency response plans have been developed to reduce the impact to groundwater.  Groundwater monitoring wells will be installed adjacent and downgradient of wellpads to monitor groundwater quality throughout the life of the Expansion Project.  Engineering design of facilities and current environmental management practices and operating standards are in place to minimize potential for releases, spills or leaks. Any impacts are expected to be constrained within upper clay-till deposits.

Residual Groundwater Diversion: Effects due to groundwater withdrawal are expected to be low to Effects moderate in magnitude. Although some groundwater drawdown is expected to occur locally, when withdrawals cease at the end of the Expansion Project, groundwater levels are predicted to recover to pre-development values. Drilling and Installation of SAGD Wells: Engineered design features as well as mitigation measures such as the use of appropriate drilling systems as approved by the ERCB and ensuring the borehole is properly cased from the production zone to surface are expected to be effective in reducing or eliminating potential impacts. As such, the magnitude of impacts to groundwater is expected to be low. Leakage from Casing Failure: The potential for impacts to groundwater quality from leakage of well fluids from operating SAGD wells is limited due to engineering measures and operational practices that will be employed. The construction and operation of the SAGD wells is engineered to minimize the possibility of casing failure, including failure of the cement seal or fracturing of the caprock. The magnitude of potential impact associated with this Project aspect is considered to be low as none are expected or likely to occur. Operation of SAGD Wells: It is expected that groundwater temperatures of aquifers, including shallow surficial aquifers, will increase in the vicinity of operating SAGD wells. Any increase in temperature is expected to result in negative effects because of the potential for enhanced solubility and/or mobility of chemical constituents. The magnitude of the impact is rated as moderate to high as the resulting temperature increase will likely increase the concentration of certain chemical constituents to above established baseline conditions. Production Facilities and Operations: The potential magnitude of any effects on groundwater quality is considered low and local in extent, as any effects to groundwater quality are expected to be contained within the shallow (<10 meters below ground surface (mbgs), fine-grained (clay-till) soils or to be mitigated through an engineered feature (e.g. the use of liners over highly conductive material). The mobilization of soluble constituents in areas where liners will not be used is expected to occur slowly as the groundwater velocity is expected to be relatively low, based on single-well tests performed in shallow sediments throughout the LSA.

2-9 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Hydrology

Assessment Study area boundaries included watersheds that may directly and indirectly be affected by the Method Expansion Project. The hydrology LSA encompasses the entire Horse Creek watershed and a small portion of an Unnamed Tributary of the Hangingstone River near the existing Demonstration Project. The LSA drainage area of 817 km2 has been divided into six sub-watersheds. The area of the sub- watersheds ranges from about 18.5 km2 to about 756 km2. Most of the LSA is located within sub- watersheds of the Horse Creek watershed except for a small area on the east side of the LSA, which is part of the sub-watershed of the Hangingstone River watershed. The RSA consists of a land area of 3089 km2 and includes the entire watersheds of the Horse and Hangingstone Rivers. The hydrologic baseline conditions including climatic and hydrological conditions in the LSA and RSA were defined by a compiling historical information and site-specific field data. Potential changes in runoff and peak flow were estimated quantitatively by assuming a change in the runoff to rainfall ratio for the disturbed areas. Potential changes in groundwater discharge to the downstream reach of the Horse Creek and two of its tributaries in the LSA were estimated, using a diversion rate of 1400 m3/day, with two pumping wells. Qualitative methods were used where objective professional judgment could be applied such as for channel morphology, erosion and sedimentation potential and channel navigability.

KeyIssues Keyissuesinclude effects of changein:  runoff quantity and peak flow  drainage patterns  groundwater - surface water interaction  water levels  channel morphology  erosion and sedimentation potential  channel navigability

Environmental Principal drainage in the region is via the Athabasca River and its tributary, the Clearwater River. Setting The Athabasca River is located west and north of the Expansion Project. The main drainages in the RSA are the Horse and Hangingstone rivers; these watercourses join the Athabasca and Clearwater Rivers, respectively, at Fort McMurray. The Christina River watershed is located to the south and east of the RSA. The Christina River flows into the Athabasca River near Fort McMurray. Drainage in the LSA is provided by Horse Creek, a tributary of the Horse River. Surface drainage is poor due to the existence of extensive flat muskeg and bog terrain. Organic fens and ephemeral streams are typical characteristics of the lowlands. Local depressions and kettle features, typical of the glacial terrain, form local closed drainage sub-watersheds with no inflow or outflow channels. Water from groundwater sources (baseflow) occurs in some watercourses in the LSA and contributes to continuous flows during winter months. An important topographic feature of the LSA is the glacial meltwater channel that intercepts flow from all the tributaries south of the channel and collects some surface flow from the areas north of the channel. The glacial meltwater channel is approximately 800 m wide. The south bank is as high as 35 m and the north bank is as high as 25 m. The northeast/southwest slopes within the channel vary from 0.1 to 0.3%.

2-10 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Hydrology (cont’d)

Project Project components that may contribute to potential effects on hydrology include: Components  construction, operation, and reclamation of project infrastructure that change surface type through the creation of impervious surfaces, clearing of vegetation, and grading and compaction of the ground, which could affect changes in runoff quantity and peak flow.  development of project infrastructure (including steam chambers) that may modify surface topography and change surface drainage patterns.  groundwater withdrawals that may potentially affect groundwater flows entering watercourse and waterbodies  changes to runoff and groundwater-surface water interaction that may change water levels in waterbodies and watercourses  changes to flow that may affect channel morphology  increased ground slopes, surface flows, and reduced vegetation cover that may cause an increase in erosion and sedimentation potential  linear infrastructure that crosses watercourses and changes in flow that may reduce watercourse navigability  changes to surface water flow and flow patterns due to possible ground heave

Effects  Potential changes in runoff quantity will be mitigated, where possible, with reuse of runoff Management collected in ponds, ditches, minimized footprint, and setbacks.  Potential changes in peak flow, water levels and channel morphology will be mitigated with runoff ponds, ditches, minimized footprint, and setbacks.  Potential changes in drainage patterns will be mitigated with swales, ditches, culverts, minimized footprint, and setbacks.  Potential changes in groundwater-surface water interaction will be mitigated by monitoring of actual drawdown to ensure effects are within the anticipated range.  Potential changes in erosion and sedimentation will be mitigated with erosion and sedimentation controls, minimization of exposed soil, and setbacks.  Potential changes to navigability will be mitigated with a minimized footprint and 2.5 m clearance from high water level to pipe rack.

Residual The quantity of surface water in the area around the Expansion Project is not predicted to be Effects affected by the construction and operation of the project. As such, there are not expected to be any reasons for a change in the use of the surface water from pre-project conditions.  Residual effects of the Expansion Project on runoff quantity, peak flows, drainage patterns, water levels, channel morphology, erosion and sedimentation and channel navigability in the LSA are expected be within the natural range of variability during the construction and reclamation phases of the Expansion Project.  The increase in mean seasonal runoff will be negligible at the confluence of Horse Creek and the Horse River (at the boundary of the LSA).  Any potential changes in surface drainage due to surface alterations will be limited to areas of disturbance.  Potential changes due to ground heave will be similar to natural fluctuations due to beaver activity.

2-11 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Hydrology (cont’d)

Residual  Any effects on water levels, channel morphology and erosion and sedimentation are expected Effects (cont’d) to be limited to an area beyond the footprint, but within the LSA.  Watercourse crossings required for the Project and any ground heave may reduce watercourse navigability. Given the discontinuous nature of the watercourses associated with surface topography and beaver activity, it is unlikely that the impediments will differ from natural impediments such as beaver dams.

Surface Water Quality

Assessment The LSA and RSA for Surface Water Quality is the same as for Fish and Fish Habitat and Method Hydrology. Baseline surface water and sediment quality conditions were characterized using field surveys conducted during winter, spring, summer and fall of 2009 and historical data summaries. Sensitivity of water bodies to acidification was assessed and summarized using monitoring information and historical data pertaining to buffering capacity (i.e. alkalinity or acid neutralizing capacity (ANC) concentrations). Issues with potential to affect water quality in watercourses were assessed qualitatively, taking into account planned mitigation measures and the magnitude of project-relative flows compared to background flows. Sensitivity to acidification of waterbodies was first assessed and summarized using monitoring information pertaining to buffering capacity (i.e., alkalinity or ANC concentrations). Potential for acidification was then evaluated by comparing lake-specific critical loads with the corresponding predicted acid inputs for 28 lakes in the RSA.

KeyIssues Keyissuesincludeeffectsof:  changes in stream flows and lake levels  releases of suspended sediments  wastewater releases  potential for spills  changes in groundwater quality  acidification of surface waterbodies

Environmental  Major ion concentrations are generally low to moderately low as indicated by electrical Setting conductance (EC) values and total dissolved solids (TDS) concentrations, with the exception of sulphide which was frequently above the aquatic guideline concentration.  Concentrations of total suspended solids (TSS) are usually low and seasonally variable in these waters.  Nutrient concentrations are variable.  Humic material originating from surrounding muskeg and peat bogs is high, resulting in elevated colour, dissolved and total organic carbon values.  Metal concentrations were generally below guideline concentrations, with the exception of total iron and manganese, both of which often had concentrations above aquatic guidelines. Occasionally, cadmium, total mercury, total arsenic and total aluminum concentrations were greater than guidelines protective of aquatic life.  Concentrations of organic compounds were usually below detection limits (total phenolics were often greater than the aquatic life guideline).

2-12 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Surface Water Quality (cont’d)

Environmental  Exceedances have been noted in other regional studies and can be attributed to natural Setting (cont’d) factors.  Water quality is typically moderately hard to hard and of sufficient alkalinity to make it less susceptible to the effects of acid deposition.  The streams and rivers assessed within the area appear to be well buffered and were classified as not sensitive to acidification during all seasons.  Lakes within the LSA are generally well buffered in relation to the area of PAI.

Project Changes in Stream Flows and Lake Levels Components Alterations in surface land type during construction may affect runoff quantity and quality, with corresponding changes in stream flows and lake levels and subsequent changes in surface water quality. Groundwater withdrawal during operations may affect baseflows and groundwater recharge rates, which may also cause changes to stream flows and lake levels and may affect water quality by changing the ground/surface water ratios and dilution effects. Reductions in groundwater levels may increase outflow from streams to groundwater, reducing water levels and flows and may affect temperature, nutrient and metal concentrations in surface waterbodies. Releases of Suspended Sediments Activities related to construction and operations of watercourse crossings associated with pipelines and service roads may result in an increase of suspended sediments to streams. Increased ground slopes, surface flows, ground heave and reduced vegetation cover can also cause an increase in erosion and sedimentation potential. Wastewater Releases Releases from plant operations, stormwater holding ponds and treated domestic water may affect surface water and sediment quality in receiving waters. Potential for Spills Project activities result in the generation of domestic sewage and operational by-products allowing for the potential for spills to waterbodies and watercourses from holding facilities. Vehicle traffic and the use of heavy machinery create the potential for spills and fluid leaks which may affect the soil, shallow groundwater and ultimately surface water and sediment quality. Changes in Groundwater Quality Activities related to injection of steam for extracting bitumen and injection of boiler blowdown liquid wastewater to depleted steam chambers may in turn affect surface water quality in areas where there is ground to surface water interaction. Acidification of Surface Waterbodies

Project activities that result in the emission of SO2 and NOx, may result in reduced pH and associated water chemistry changes (including the increased solubility of some metals including aluminum) of acid sensitive surface waterbodies. As pH in a lake or stream decreases, aluminum and other metal concentrations may increase. The effects of potential water quality changes due to Expansion Project activities are discussed further in the Human and Ecological Health assessment.

2-13 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Surface Water Quality (cont’d)

Effects Mitigation measures to prevent changes in water quality include: Management  using perimeter berms, ditches, culverts and swales to direct runoff to holding ponds and increase infiltration  using stormwater retention ponds to mitigate stormwater flow rates. Water from the retention ponds will be released to adjacent land at baseline flow rates (provided it meets surface water quality requirements)  constructing all ponds to meet ERCB Directive 55 Storage Requirements for the Upstream Petroleum Industry  constructing Expansion Project facilities away from watercourses to the greatest extent possible,  designing and constructing stream crossings according to best management practices outlined in AENV’s Code of Practice for Watercourse Crossings  minimizing exposed soil (e.g., re-vegetation, erosion matting, staged construction)  maintaining setback distances of minimum 100 m between any component of the Expansion Project and surface waterbody with the exception of watercourses, as outlined in the ERCB’s draft waterbody directive (ERCB 2009). Where developments fall within 100 m of a waterbody, the assessment procedure outlined in the draft directive will be followed, and site-specific mitigation measures developed.  constructing crossings during the winter months to minimize any effect on watercourses  constructing a 1 in 25 year, 24 hour stormwater retention pond required to mitigate stormwater pond overflow and subsequent potential sediment discharge  no process water will be released to surface waterbodies. All generated waste will be either treated or trucked to approved land fill facilities.  domestic sewage will be treated using a septic treatment system  use of a stormwater retention pond to collect runoff water, water from the retention ponds will normally be recycled to the process, but if necessary, it will be tested and treated to meet AENV guidelines and if necessary released to adjacent land  all injection and well casings will be constructed to ensure a competent cement seal and monitored for integrity  groundwater response protocols will be implemented within the context of the overall environmental management plan to ensure that any effects on groundwater quality are minimized and remediated  monitoring wells will continue to be sampled to ensure groundwater quality is not affected by Expansion Project activities

Residual Both the quality and quantity of surface water in the area around the Expansion Project are not Effects predicted to be affected by the construction and operation of the project. As such, there are not expected to be any reasons for a change in the use of the surface water from pre-project conditions. The proposed mitigation measures for the Expansion Project are expected to effectively mitigate potential releases of suspended sediments to local waterbodies. With the proposed mitigation and environmental protection measures, the effect of releases of suspended sediments on surface water quality due to the Expansion Project is anticipated to be not significant. The proposed operating procedures and codified practices for the Expansion Project are expected to effectively mitigate wastewater releases to local waterbodies. Therefore residual effects on surface water quality due to wastewater releases are not anticipated.

2-14 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Surface Water Quality (cont’d)

Residual The proposed air mitigation measures for the Project are expected to effectively mitigate potential Effects (cont’d) releases of acidifying compounds into the atmosphere and limit the acidification risk of waterbodies within the RSA. With the proposed mitigation and environmental protection measures, the effect of acidification on surface waterbodies due to the Project is anticipated to negligible.

Fish and Fish Habitat

Assessment The LSA and RSA for Fish and Fish Habitat are the same as for surface water quality and Method hydrology. Baseline conditions of fish habitat and fish community structure were described using field survey data collected in 2009 and historical information collected in 2001. Effects on fish and fish habitat were largely qualitative and based on information from the surface water quality and hydrology assessments. Potential effects of the project on access and sport fish populations were also assessed.

KeyIssues Keyissuesincludeeffectsof:  increased sedimentation  change in water levels and flows  changes in riparian habitat  changes in benthic invertebrate community abundance and composition  changes in pH  increased access

Environmental Tributaries to Horse Creek Setting Three unnamed tributaries to Horse Creek were surveyed and were located within the LSA. These sites were studied previously for JACOS in 2001 and were revisited in 2009 to update any changes that may have occurred. Site F1 was located south of the Project, adjacent to Highway 63 and consisted of a series of flooded beaver impoundments with braided, irregular meandering channels Fish habitat potential within this reach was considered to be low for large-bodied and sport fish, and moderate for forage fish species. Site characteristics were noticeably changed from 2001 due to beaver activity. Site F2 was located directly east of the Project and consisted of riffle, run, and pool complexes. While the habitat was diverse, this unnamed watercourse would provide low overwintering habitat potential for large-bodied and sport fish species. Site F3 was located east of the Project, encompassing a reach that extended 200 m upstream and downstream of Highway 63. Moderate to high habitat potential for all fish species was observed during the open water seasons but was poor in winter (frozen to the bottom). Horse Creek Six sites were located on Horse Creek (within the LSA), five sites within the upper reach (F4, F5, F6, F7, F8) and one on the lower reach of Horse Creek (F9). The upper section of Horse Creek (sites F4 and F5) consisted of an unconfined channel with an incised profile, bordered by grasses, forbs and shrubs. Overwintering, feeding, and rearing habitat potential was considered low to high for all life stages of all fish known to inhabit the region (depending on under-ice dissolved oxygen levels). Spawning habitat was limited due to a lack of suitable substrate or instream vegetation and was considered to provide limited potential.

2-15 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Fish and Fish Habitat (cont’d)

Environmental The middle section of Horse Creek (sites F6, F7, and F8) was characterized by an incised channel Setting (cont’d) that was occasionally confined. The middle section of Horse Creek provided moderate overwintering habitat for all stages of large-bodied and sport fish species, and high quality habitat for forage fish species. The lower reach of Horse Creek (F9) contained substrate that was composed primarily of boulder, cobble and gravel with fines. Overwintering habitat potential was moderate for large-bodied and sport fish species and high for forage fish due to suitable depths and dissolved oxygen levels. Spawning, rearing and feeding habitat potential was moderate to high for all fish species known to inhabit Horse Creek. Horse River The Horse River at the study site (F11) consisted of habitat with moderate to slow flowing water depending on the season. This section of the Horse River provided moderate to high quality habitat for all life stages of large-bodied, sport, and forage fish species known to inhabit the Horse River. Unnamed Waterbodies Two unnamed waterbodies were located within the LSA, one to the north of the Project (JL9), and one to the southeast of the Project, adjacent to Highway 63 (JL1). Due to a lack of connectivity and fish capture at these sites sport fish presence is deemed to be unlikely. Sweetheart Lake Sweetheart Lake drains into an unnamed tributary to the Hangingstone River headwaters. Spawning, rearing, and feeding habitat potential was considered high for northern pike, walleye, longnose sucker, and forage fish and moderate for arctic grayling due to sufficient dissolved oxygen levels, depth and suitable spawning substrate. Overwintering habitat potential was considered high for large-bodied, sport and forage fish due to sufficient overwintering depths and dissolved oxygen levels.

Project Alteration of riparian and instream fish habitat occurs as a result of: Components  sedimentation from riparian and instream disturbances (e.g. road, pipeline and pad construction)  changes to water flows and levels from changes to surface drainage patterns  loss or alteration of riparian habitat from the clearing and disturbance of shoreline vegetation  changes in benthic invertebrate abundance and composition from changes in water quality and surface water flow patterns Disturbances of fish habitat occurs as a result of:  spills and discharges directly related to project specific activities  changes in surface water pH that could result from project emissions and resulting loss of fish habitat Access results in increased access to watercourses and waterbodies in the vicinity of the Project that could result in increased fishing pressure.

2-16 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Fish and Fish Habitat (cont’d)

Effects Potential sedimentation effects due to riparian and instream disturbance will be mitigated with Management erosion and sedimentation controls, minimization of exposed soil and setbacks. Access Roads Construction of roads will require a number of watercourse crossings, including crossings for access roads to the well pads and other surface facilities. JACOS will implement the following mitigation measures to avoid or reduce the effects related to the construction of roads:  Implementation of the general mitigation measures as described for Hydrology.  An expanded spill response protocol, as part of the environmental management plan, will be prepared for all crossings and spill response materials will be present during all construction activities at crossing locations.  Disturbed ground will be revegetated with an Alberta Sustainable Resource Development (ASRD) approved, regionally specific native seed mix.  More specific mitigative plans and procedures will be developed and implemented once the Expansion Project has been approved and any required revisions to its design have been developed. Pipelines The following mitigation measures will be implemented to reduce the effects related to pipeline construction:  The implementation of the general mitigation measures as described for Hydrology.  Appropriate precautions will be taken to prevent harmful substances from entering watercourses. The spill response protocols will be reviewed with site personnel before construction activities begin.  Sites will be revisited to monitor the stability of the pipeline crossing sites until the site is revegetated and stabilized.  Additional site specific mitigation measures will be determined at each crossing location following site specific fish and fish habitat visits. To reduce effects on water levels and peak flow of runoff, the following mitigation will be implemented:  The main process area of the CPF will be surrounded by a road that will act as a perimeter berm. Surface water collected within this berm will be directed to a runoff pond sized to store the runoff from the 1:25-year, 24-hour storm event. The water in the pond will be reused in the process or released at a controlled flow rate, provided it meets quality requirements.  Wellpads will have a perimeter berm and ditch system that conveys runoff into a runoff pond sized to store the runoff from the 1:25-year, 24-hour storm.  All surface disturbances will be constructed away from watercourses to the greatest extent possible, following the regulatory requirements, with the exception of the facilities that cross watercourses. Under normal operating conditions, acidification from aerial deposition is not expected to occur. In the event that critical loads for waterbodies in the region are exceeded, AENV will implement management options under the Alberta Acid Deposition Management Framework. Sport fishing activities in the RSA are regulated through ASRD. JACOS will implement development strategies (e.g., progressive reclamation of roads and the rollback of cut lines) to limit access to watercourses and waterbodies that have the potential to support fish populations such as northern pike, walleye, and Arctic grayling The implementation of mitigation measures and the integration of habitat compensation during the Project will align with DFO’s guiding principle of “No Net Loss” under the Policy for the Management of Fish Habitat.

2-17 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Fish and Fish Habitat (cont’d)

Residual The Expansion Project will have low to negligible effects on fish habitat, fish health and fish Effects abundance.

Terrain and Soils

Assessment Terrain baseline conditions within the LSA were documented by reviewing existing data sources Method and by conducting a terrain field survey in 2009 to supplement terrain information collected during the 2002 soil survey. Terrain and Soils LSA and RSA were chosen to encompass the types of environmental effects that may occur. The LSA boundary was established to cover all arras that may be directly affected by the Expansion Project. The RSA is designed to evaluate effects of the Expansion Project and other similar developments in the region and encompasses the farthest measurable effect associated with the Expansion Project Soil assessments were carried out to Survey Intensity Level (SIL) 2 standards. The LSA forms the basis of the assessment for soil capability and soil diversity. Regional scale mapping within the RSA forms the basis of the assessment for soil diversity, if applicable, and acid sensitivity. Soil and landscape information were collected according to national standards in 2002 and 2009 at 418 soil and terrain inspection sites. This information was used to map soils to the series level. Soil series were assigned soil capability ratings using the Land Capability Classification System for Forest Ecosystems in the Oil Sands and acid sensitivity ratings from Critical Loads of Acid Deposition on Soils in the Athabasca Oil Sands Region, Alberta. Soil diversity was determined based on the areal extent and proportion of each series in the LSA and RSA, if applicable. The areas of each series and ratings class were evaluated to assess the potential cumulative changes in these parameters throughout the life of the Project. The effects of changes in soil capability, soil diversity, and soil acidification were assessed.

Key Issues Changes to the ground surface during operations due to ground heave and/or subsidence may impact terrain integrity. Project development and reclamation activities may alter the texture, structure, nutrient status and moisture regime of natural soils within the Project area. Changes to soil properties have the potential to alter capability. The development and reclamation of the project has the potential to result in the loss or reduction of a soil series within the Project Area. Therefore, soil diversity as it relates to soil capability is a key issue for the proposed development. Since each soil type has different qualities that provide the foundation for a specific assemblage of vegetation and wildlife, as well as micro-organisms and macro-organisms within the soil profile, changes to soil diversity have the potential to affect biodiversity. Soil acidification as it relates to soil capability is a key issue for the proposed development. During the operation stage soils affected by acidifying emissions may experience decreased productivity, which may in turn affect soil capability and the health of natural vegetation communities.

Environmental Ground elevation in the LSA increases gradually from northwest to southeast. Topography is Setting generally subdued with level and gently undulating glaciolacustrine, glaciofluvial and till plains and slopes typically less than five percent. The southeast corner displays more diverse topography due to glaciofluvial deposits creating an area of hummocky topography with slopes of 2% to 16%. Large wetland complexes are present in the LSA, primarily in the central and north central area. These wetlands are predominantly poor fens consisting of a complex of sphagnum and fen peat. The primary drainage outlet is Horse Creek, which dissects the centre and western edge of the LSA. Approximately 50% of the 1600 ha LSA is dominated by mineral soils while organic soils comprise 45%. The mineral component includes 23% transitional soils that are classified as Gleysols but often have an organic surface horizon of less than 40 cm. The remainder of the study area (5%) consists of disturbed land and open water.

2-18 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Terrain and Soils (cont’d)

Environmental The dominant soil within the LSA is the Terric McClelland series. Terric McClelland and McClelland Setting (cont’d) soils are organic and have peat thicknesses ranging from 40 to >220 cm. The dominant upland mineral soils are the Bitumount and Firebag series. Approximately 72% of the LSA and over 87% of the RSA are considered to have a low sensitivity to acidification. No soils in the LSA or RSA are considered to have a high sensitivity to potential acid input (PAI) in a 50 year timeframe.

Project The construction and operation phases of the Expansion Project will result in surface clearing and Components disturbance for well pads, plant site and associated facilities, underground pipelines, borrow pits, landfills and access roads. Surface clearing and disturbance have the potential to impact terrain integrity, soil capability and soil diversity. The operation of the Expansion Project will result in the release of sulphur and nitrogen containing compounds into the atmosphere. These compounds are eventually deposited on the soil by either wet or dry deposition, where they have the potential to initiate chemical changes in soils that are sensitive to acid deposition.

Effects Effects management measures, some also indicated in the Conservation and Reclamation Plan and Management to be developed as part of the environmental management plan (Volume 1, Section 17.1.1), include:  monitoring of reclamation activities to ensure the success of the approved reclamation plans  soil characteristics within reclaimed sites will be inventoried to ensure that no impediments to soil forming processes or the establishment of vegetation exist. JACOS has also incorporated design features that will mitigate effects on soils, including:  limiting disturbed area  minimizing soil exposure  establishing vegetation on stockpiles and disturbed areas to minimize erosion  using ditches and culverts to minimize water erosion  avoiding construction when soils are wet, or implementing appropriate mitigations (e.g. mats, pads, etc.)  ensuring appropriate salvage procedures  implementing spill prevention, spill contingency planning and pre-reclamation inspection for contamination Various additional mitigation strategies will be employed to address changes in soil diversity, particularly the potential loss of organic soils associated with wetlands, including:  introduction of micro-topography (1-2 m relief undulations) where necessary to simulate surrounding conditions and introduce landform diversity. This will encourage the development of a variety of moisture regimes and topographic positions for soil development.  concentrating disturbance on mineral soils and/or widely distributed soil series  minimizing disturbance of organic soils Mitigation of soil acidification relies solely on efforts to reduce acidifying air emissions at the source because managing acid inputs in non-agricultural areas once they have been deposited is not practical given current technology. JACOS will monitor project emission sources as required.

2-19 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Terrain and Soils (cont’d)

Residual Soil Capability Effects  Residual environmental effects on soil capability include soil erosion, compaction, admixing and contamination. The effect on soil capability is positive in direction, low in magnitude, and local in geographical extent.  During the construction and operations phases, it is assumed that all soils within the Project Area will have been entirely disturbed and thus be non-productive for forestry (Class 5). This will result in the area of Class 5 soils increasing from 45.1% (Base Case) to 63.5% of the LSA. These soils will remain as Class 5 until they are reclaimed per Alberta Environment requirements.  Following decommissioning, the LSA will experience an increase in Class 3 soils from 3% to 16% of the LSA, while Class 5 soils decrease from 45.1% to 32%. This reduction in Class 5 soils is associated with the decrease of organic soils following decommissioning.  Soil capability within the LSA will change in a positive direction with the increase in Class 3 soils.  With implementation of the proposed mitigation and environmental protection measures, the environmental effect of the Project on soil capability is considered to be not significant. Soil Diversity  The project will not result in the total loss of any soil series within the LSA. Following implementation of mitigation strategies, there will be no residual environmental effects associated with soil diversity due to the Project.  No soil series will be lost as a result of cumulative land use activities in the RSA (although the areal extent of individual soil series will be altered slightly). All soil series present at Base Case will remain at closure. Future developments in reclamation techniques will be monitored for improvements in reclamation of organic soils (e.g., McClelland and Terric McClelland series) to mitigate the predicted effect on soil diversity. Soil Acidification The level of PAI associated with the Expansion Project is less than the critical loads of the soils within the RSA. Following the mitigation strategies described for air quality, it was determined that there will be no residual environmental effects associated with soil acidification due to the Expansion Project. The Expansion Project will not result an increase in area of soil where the critical PAI load has been exceeded for soils mapped within the RSA during the operations phase.

Vegetation and Wetlands

Assessment The LSA was defined on the basis of the maximum area where Project-specific environmental Method effects for vegetation and wetlands could be measured. Specifically, a 500 m buffer was established around the JACOS Project Area and all Expansion Project footprint features that extend beyond the Project Area. The RSA is approximately 11 200 km2 in area, and was delineated to include locations of regional industrial developments (existing, planned and approved) that have the potential to interact cumulatively with the Expansion Project). The Vegetation RSA is the same as for wildlife. This was done to meet wildlife and biodiversity assessment needs through regional landscape vegetation community classification and capture the farthest measurable air emission effect associated with the Expansion Project.

2-20 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Vegetation and Wetlands (cont’d)

Assessment Field surveys were performed June 29 to July 4 and again in August 18 to 29, 2009 to supplement Method historical baseline field data. A review of existing field plot data along with aerial photographs, (cont’d) Alberta Vegetation Inventory (AVI) mapping, historical wildfire data, Alberta Natural Heritage Information Center (ANHIC) data bases and existing land classification systems provided the direction for 2009 field surveys and filled information gaps. A revised vegetation classification system was developed for this Expansion Project with new ecosite phases being added to accommodate site types not described in existing classification systems. A focused assessment was used to identify and assess potential effects on infrequently occurring (rare) vegetation and wetland species.

Key Issues Key issues include:  site clearing and construction of associated facilities could result in a reduction or direct loss of vegetation communities and diversity  changes in vegetation composition associated with construction and closure through the potential introduction and dispersal of undesirable species  indirect loss of vegetation and wetlands from abiotic changes (e.g., drawdown of surficial groundwater or change in water quality) associated with facility operations and closure  changes in species health or loss of sensitive species associated with air emissions during operations  reclamation could cause a change in vegetation communities relative to Baseline  changes in species health resulting in increased or decreased growth rates The effects assessment provided in this section includes potential changes to specific VEC communities, rare and undesirable plant species and vegetation communities sensitive to air emissions.

Environmental The Expansion Project is located within the Lower Boreal Highlands and Central Mixedwood natural Setting subregions of Alberta, each with their own distinct climate, physiography and associated vegetation. Fire has a significant role in the current composition and pattern of vegetation communities in the Expansion Project area. Around 7000 ha (60% of the LSA) has been influenced by fire in the last 15 years – once in 1995 and again in 2009. As a result, over 41% (4835 ha) of mapped units within the LSA fall within the tall shrub structural height class (2.5 m to 5.0 m). Vegetation and wetland communities in the LSA are characterized by:  upland and lowland transition areas that cover about 7000 ha (60%) of the LSA with the most common site type being the Labrador tea–subhygric burn  wetland communities that cover about 3700 ha (32%) of the LSA with the most common wetland type being shrubby, deciduous swamps  disturbed lands that cover about 960 ha (8%) of the LSA  old-growth forests that cover 340 ha (3%) of the LSA  riparian communities that cover about 900 ha (8%) of the LSA, dominated by shrubby, deciduous swamps and ecosite phases belonging to dogwood/fern ecosites  the presence of 11 rare plants – including 3 vascular plants, 3 mosses and 5 liverworts  the presence of several non-native and invasive plant species – including 4 noxious species, 6 nuisance species and 13 invasive species  about 30% of the LSA is rated as having high traditional plant use potential

2-21 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Vegetation and Wetlands (cont’d)

Environmental Vegetation communities in the RSA are characterized by: Setting (cont’d)  open and closed upland forests that cover more than 600 000 ha (57%), dominated by the closed Se/Sw (coniferous) class  wetlands that cover about 425 000 ha (38%), dominated by the Black Spruce Bog class  a remaining land base (5%) of existing human caused disturbances, burns, water, miscellaneous grasslands and shrublands One rare plant community was identified in the RSA, located east of the Expansion Project area with a provincial rank of S1/S2.

Project Construction may result in: Components  an initial loss of vegetation and wetlands related to site clearing and construction of Expansion Project components and infrastructure  the potential for the introduction and spread of undesirable (native and/or invasive) species Operations may result in:  potential indirect effects on wetlands through drawdown of surficial groundwater  potential effects of air emissions on vegetation and wetland health and diversity Effects Since reclamation and maintenance of landscape diversity is a regional concern, JACOS plans to Management participate in the Reclaiming the Wellsite Footprint Initiative (as coordinated by the ILM Chair at the University of Alberta) and Sustainable Ecosystem Working Group of CEMA or similar groups in the oilsands area. Mitigation for rare plant species will be achieved through avoidance whenever possible. In areas where avoidance is not possible, alternative mitigation strategies such as seed collection and sowing, direct transplantation or diaspore dispersal will be developed, as required in consultation with ASRD. As alternative mitigation strategies are considered experimental their implementation is not deemed to reduce residual environmental effects. Mitigation measures for the introduction of non-native and invasive species will follow accepted weed management practices as outlined in the Conservation and Reclamation Plan. Weed control includes:  complying with the Alberta Weed Control Act  selecting appropriate weed control methods  soil sterilants will not be used for weed control  prevention of unnecessary soil disturbances wherever possible  ensuring equipment arrives on site clean and free of dirt and vegetative material  keeping equipment as clean as reasonably practical throughout the duration of Expansion Project operations  ensuring proper disposal of weeds removed by mowing or picking  disposal of screenings or other refuse containing weed seeds as directed by the field inspector, or contained so that they are not scattered  double-sampling for weed species of all native seed used for revegetation purposes. For licensed grass species, the approved seed mix will be used.  certified ‘weed-free’ seed will be used for revegetation purposes  avoiding introduction of weed seed in plugs or soil of containerized or bareroot revegetation stock  regular weed monitoring  responding rapidly to weed infestations

2-22 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Vegetation and Wetlands (cont’d)

Residual VEC Community Loss Effects Direct effects on measurable parameters associated with the loss of VEC communities were considered negative to neutral in direction, low to moderate in magnitude and likely to extend into the far-future at the local scale. Overall, effects are considered to be not significant although loss of vegetation communities from construction activities may contribute to cumulative effects at the regional scale. Rare Plant Species Loss The effect of rare plant species loss is considered to be negative in direction, high in magnitude and irreversible with respect to rare plants affected by construction activities. Mitigation for rare plant species will be achieved through avoidance. When avoidance is not possible, alternate mitigation strategies (such as seed collecting and sowing, direct transplantation, or diaspore dispersal) will be developed in consultation with ASRD; however these strategies are considered experimental and may not reduce residual environmental effects. As a result there is the potential for effects to be significant and contribute to cumulative effects at the regional scale. Introduction of Undesirable Species Environmental effects related to the introduction of undesirable (non-native and invasive) species were considered negative in direction, low in magnitude and reversible as mitigation will successfully control the introduction and spread of weeds. The introduction of undesirable species will not contribute to cumulative effects at the regional scale as weeds are expected to be controlled according to weed management protocols. Vegetation Sensitive to Air Emissions

The Expansion Project will emit SO2 and NO2 and will contribute to nitrogen deposition. As a result, it is predicted to contribute directly to fumigation and fertilization effects on vegetation. Direct effects were considered negative in direction, low to moderate in magnitude and likely to extend into the far future at the regional scale. Expansion Project contributions to regional fumigation effects have the potential to contribute to cumulative effects but are considered not significant at the regional scale. At the local scale, road dust effects are also considered to be not significant, being negative in direction, low in magnitude and reversible through mitigation. The Expansion Project is predicted to contribute to indirect effects on vegetation associated with changes in soil chemistry from PAI.

Wildlife

Assessment Historical wildlife information was obtained from the Fisheries and Wildlife Management Information Method System (FWMIS) database, other EIAs, and peer-reviewed publications, with an emphasis on studies overlapping the RSA. These data were used to provide baseline knowledge on species presence, distribution, potential habitat use, and movement, as appropriate. Baseline surveys were conducted in 2001, 2002 and 2009 to provide current information on species presence, distribution, relative abundance and habitat use in the area to help identify important wildlife habitat and seasonal use of that habitat for some species Surveys were designed to gather baseline information on indicator species and, where possible, species at risk. The surveys also provide data which were used to evaluate habitat models. Additional winter work is planned for 2010 including winter tracking and an ungulate aerial survey. Potential Expansion Project interactions with wildlife were identified and assessed based on precedence from other similar EIAs and on professional judgment. Local Study Area The LSA was delineated to ensure the inclusion of all lands where there is reasonable potential for Project-related effects on wildlife and their habitats. The LSA covers approximately 117 km2 and encompasses the Project footprint including source wells, pads, roads, pipelines, utilities, plant facilities and disposal wells, and a 500 m buffer surrounding these areas.

2-23 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Wildlife (cont’d)

Assessment Regional Study Area Method The RSA is approximately 11 200 km2 in area, and was delineated to include: (cont’d)  locations of regional industrial developments (existing, planned and approved) that have the potential to interact cumulatively with the Expansion Project)  an area that is sufficient in size to assess cumulative effects for wildlife species that are known to occupy large home ranges and that may exhibit daily and seasonal movements extending outside the LSA The wildlife assessment focused on the following indicators, which were selected to represent a broad range of wildlife resources:  Canadian toad  northern goshawk  mixedwood forest bird community  old growth forest bird community  barred owl  beaver  snowshoe hare and Canada lynx  moose  woodland caribou  black bear Habitat models provided a tool for assessing effects resulting from reduced habitat availability. Potential habitat connectivity was evaluated qualitatively to maintain a practical assessment in the absence of data on how caribou and moose use the landscape for movement and dispersal. A qualitative discussion was used to assess potential indirect mortality risks.

Key Issues Key issues include potential effects on wildlife:  habitat availability resulting from habitat loss and alteration, and from reduced habitat effectiveness including the effects of noise on songbirds  habitat connectivity caused by barriers to wildlife movements  populations resulting from increased levels of direct and indirect mortality risks  health resulting from changes in air and water quality and soil chemistry

Environmental Over 44 mammal species may occur in the RSA, of which 8 are identified as species at risk. Five Setting species of amphibians and reptiles may occur in the RSA and three are identified as species at risk. In total, 175 bird species potentially occur within the RSA during the breeding season, and 42 of these are species at risk.

Project The Expansion Project is expected to result in direct and indirect (i.e., reduced habitat effectiveness Components adjacent to facilities) loss of habitat as follows:  Direct habitat loss results from the physical clearing of vegetation and soils prior to construction. Indirect habitat loss results when wildlife use of habitat is reduced due to Expansion Project influences. Increased traffic volume or elevated levels of noise may reduce the quality of neighbouring habitats such that a species reduces its use or selection of those habitats.

2-24 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Wildlife (cont’d)

Project  The effect of direct and indirect loss of habitat will last throughout the life of the Expansion Components Project until the disturbance is removed. In addition to the Expansion Project, other projects in (cont’d) the area may add cumulatively to habitat loss.  The Expansion Project may affect wildlife movements by reducing habitat connectivity. Above ground pipelines, infrastructure and roads are potential barriers to animal movements. The Expansion Project may affect wildlife populations by directly or indirectly increasing wildlife mortality risk. Mortality directly related to the Expansion Project may occur as a result of:  habitat clearing, which poses a direct risk to wildlife from destruction of nests, dens or hibernating species  collisions with equipment and vehicles  destruction of problem wildlife Indirect mortality risks related to the Expansion Project may occur as a result of increased:  stress levels or sensory disturbance due to industrial activities (e.g., from noise)  exposure to predation  legal and illegal hunting

Effects Effects management measures include: Management  integration of Expansion Project developments with other existing or proposed land use activities where possible to minimize new disturbance, density of linear features, industrial noise, and habitat loss.  avoiding clearing or conducting pre-clearing nesting surveys from April 1 through August 31 to avoid active migratory bird nests.  constructing above ground pipeline crossings at appropriate intervals to allow for wildlife movements. During construction of underground pipelines gaps will be left in linear construction areas to allow animal movements across the work area.  reclamation of upland sites to an equivalent land capability  conducting progressive reclamation, including actively revegetating utility and pipeline corridors as early as reasonably practicable  using certified native vegetation species in reclamation  allowing natural woody vegetation to grow back along the edge of cleared pipeline and power line right-of-ways (ROWs) where possible to reduce lines of sight while accommodating safety and pipeline monitoring concerns  providing appropriate supervision during environmentally sensitive construction activities to ensure environmental mitigation is implemented  implementing appropriate run-off and erosion control measures  conducting fuelling and oil and gas transfer operations at an appropriate setback distance from watercourses and waterbodies  limiting off-road access by rolling back debris or reclaiming intersections of existing linear disturbances

2-25 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Wildlife (cont’d)

Residual The Expansion Project will result in direct loss of habitat, as well as reduced habitat effectiveness Effects adjacent to facilities for some species. Canadian toads were not detected during surveys conducted in the LSA in 2001 or in 2009 and are unlikely to occur due to the isolated patches of high quality habitat within an area of predominantly lowland habitat types. The final effect rating of the Expansion Project on habitat availability for Canadian toads is predicted to be not significant. The final effect rating on habitat availability for northern goshawk is predicted to be not significant, as nesting habitat loss associated with the Expansion Project is unlikely to have a regional population level effect. Effects on mixedwood forest and old growth forest bird communities are expected to be subregional in extent, since some species may avoid edges. The final effect rating is predicted to be not significant because habitat loss associated with the Expansion Project is unlikely to have a regional population level effect. Effects on barred owl habitat availability are predicted to be medium in magnitude because of a detectable change greater than natural variation. Because the LSA has limited nesting habitat available for the barred owl, and given the low amount of high quality habitat affected, the Expansion Project is unlikely to have a regional population level effect on barred owls. The final effect rating is, therefore, predicted to be not significant. Changes in beaver habitat availability as a result of the Expansion Project are low in magnitude and subregional in extent since effects of clearing extend beyond the footprint. Due to the low amount of habitat loss, the Expansion Project is unlikely to affect the regional beaver population and, therefore, the effect is predicted to be not significant. There is potential for a localized shift in lynx distribution as a result of the Expansion Project; however, the Expansion Project is not likely to result in a regional population change for lynx or snowshoe hare. Therefore, the final effect rating for habitat availability in the LSA for snowshoe hare and lynx is not significant. Although the Expansion Project will affect moose and caribou habitat within the RSA, the predicted change in habitat availability is judged to be too small to cause a measurable change in the regional population of either species. The Expansion Project’s contribution to cumulative environmental effects in the RSA is not likely to affect the viability or sustainability of moose and caribou in the RSA. The Expansion Project will increase the level of industrial noise in the LSA during construction and operation. The Expansion Project effects of noise on habitat effectiveness for songbirds will be low in magnitude and subregional in extent. Since the area affected is low, the final effect rating for reduced habitat effectiveness as a result of noise is considered not significant. With mitigation, the residual effect of the Expansion Project on local habitat connectivity is considered a medium magnitude effect as above-ground pipelines and roads will create only partial barriers to movement. The Expansion Project is not likely to cause a measurable change in the regional population of either moose or caribou. The Expansion Project’s contribution to cumulative environmental effects on habitat connectivity in the RSA is not likely to affect the viability or sustainability of moose and caribou in the RSA. With the planned mitigation and use of best management practices, the effect of changes in wildlife habitat connectivity is anticipated to be not significant. Although the Expansion Project could potentially affect direct mortality for Canadian toads, black bear, moose, and caribou within the LSA or RSA, it is not likely to cause a measurable change in the regional population of these species. Therefore, the final effect rating on mortality risk is considered to be not significant.

2-26 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Biodiversity and Fragmentation

Assessment Biodiversity and Fragmentation was assessed using mapping and field data compiled from the Method assessments of:  Fish and Fish Habitat  Vegetation and Wetlands  Wildlife The terrestrial biodiversity study areas are consistent with the vegetation and wildlife study areas. The aquatic biodiversity study areas are consistent with the Fish and Fish Habitat study areas. To assess Expansion Project effects on habitat removal and habitat fragmentation, the biodiversity of the LSA and RSA was mapped and delineated into landscape units. Within the LSA, habitats were delineated using Alberta Vegetation Inventory (AVI) data and classified using Ecological Land Classification (ELC) categories for uplands and Alberta Wetland Inventory (AWI) categories for wetlands. Habitats were identified and mapped at the RSA scale using Alberta Ground Cover Characterization (AGCC) categories Landscape units were mapped and effects were assessed in the LSA at two phases: the construction and operation phase of the Expansion Project and after Project decommissioning and reclamation. The construction and operation phases of the Project were combined into one phase for the purposes of this assessment because effects are expected to occur during construction and persist throughout operation. The likelihood of reductions in habitat or species richness was determined using a combination of data analysis, professional judgment and, where possible, published research. The extent of changes in habitat quantity and area was assessed using two indicators: habitat richness and total habitat area. Habitat richness is a measure of the number of different habitats in the study area. To aid in the assessment of the effects of habitat removal on species diversity in the LSA, ecosites, ecosite phases and wetlands were ranked according to their plant and wildlife species biodiversity potentials. This ranking was used in conjunction with measures of effects on habitat area and habitat fragmentation to predict effects on species diversity in the LSA. The vegetation and wildlife biodiversity potential of each habitat was calculated as an index value. This was converted into a ranking that indicates whether a habitat has high, intermediate or low biodiversity potential relative to other habitats. Project effects on aquatic species biodiversity were assessed qualitatively based on effects to aquatic habitats and the conclusions of the Fish and Fish Habitat assessment.

Key Issues Land clearing is likely to indirectly affect species diversity through the direct effects on landscape diversity. Habitat removal and habitat fragmentation can affect species by:  reducing habitat availability  removing habitat resources  increasing exposure to edge effects  reducing connectivity between habitat patches

2-27 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Biodiversity and Fragmentation (cont’d)

Environmental The LSA and RSA for Biodiversity fall within the Central Mixedwood and Boreal Highlands Natural Setting Subregions. Approximately one-third of the LSA is comprised of upland habitat burned in recent forest fires and is in an early stage of succession. The remaining habitat area consists of relatively mature upland forests and wetlands, with the latter also occupying approximately one third of the LSA. Wetlands are mostly fens, swamps and marshes; open water wetlands occupy only a small proportion of the LSA. Aquatic habitats also occupy only a small area. Rare, sensitive or “at risk” species were identified during vegetation and wildlife surveys in the LSA. Lists of these and all other species found in or associated with terrestrial and aquatic habitats in the LSA and RSA are given in the Fish and Fish Habitat; Vegetation and Wetlands; and Wildlife assessments.

Project Clearing associated with construction on previously undisturbed land will result in the removal of Components habitat area. Clearing has the potential to affect habitat richness if the Expansion Project footprint entirely covers one or more habitats.

Effects Mitigative measures to prevent or reduce residual effects on habitat richness include the following, Management where practicable:  construction on previously disturbed land  avoiding construction on habitats that are relatively rare in the LSA or RSA  minimizing the spatial extent of disturbance

Residual Habitat mapping based on the proposed footprint of the Expansion Project indicates that no ecosite, Effects ecosite phase, AWI-classified wetland or AGCC cover class will be completely removed. The Expansion Project is therefore expected to have no residual effects on habitat richness at the local or regional scale. Construction will result in a temporary reduction in the area of some habitats. In most cases, however, this residual effect is expected to be reversible during reclamation. The residual effects of reduced habitat area on landscape and species diversity trigger different ratings for the construction and operations phase and the decommissioning and reclamation phase of the Expansion Project. Activities that may lead to cumulative environmental effects are primarily related to land clearing for construction of the Expansion Project and other planned and future projects. Site clearing will have a cumulative effect upon habitat area in the RSA. The construction of these projects will reduce the total area of land occupied by natural and semi-natural habitats at the regional scale. Potential effects of habitat removal at the regional scale are expected to be similar to those at the local scale. The reduction of habitat area could affect landscape diversity by changing the relative abundance of habitats. Habitat richness will be reduced if entire habitats are removed. If dewatering completely removes one or more aquatic features (e.g. pools, ponds, creeks), this could result in the loss of some aquatic habitats from the study area. Trapping, hunting, recreational activities and the operation of other facilities may affect plant and animal species through direct mortality or increases in noise, light or traffic. These activities are expected to have a negligible or no effect on biodiversity.

2-28 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Land and Resource Use

Assessment The study area boundaries were selected based on potential direct and indirect Project effects on Method selected indicators (same boundaries as the Vegetation study areas). A Land Status Automated Search (LSAS) was undertaken for the entirety of Township 84, Ranges 10-12 W4M to identify surface and subsurface lease holders with the potential to be affected by Expansion Project activities. Information for the assessment was also gathered through:  personal communication  review of other EIAs submitted for projects in the region  review of published material relating to land and resource use activities  review of reports posted on various government and non-government websites  review of relevant industry and government management plans  information from other VECs assessed in this EIA Effects assessed included:  changes to surface and subsurface interests  changes to environmentally important areas  changes to aggregate resources  changes to forestry and agriculture  changes to recreation activities including hunting, trapping, fishing, berry picking, non- consumptive outdoor recreation The Expansion Project was also assessed in the context of applicable land use policies and resource management initiatives to ensure there were no potential conflicts with such policies.

KeyIssues Thekeyissuesincluded:  management planning for forest harvesting  management planning for aggregate resources  effect on hunting, trapping and fishing due to habitat disturbance or constraint, or increased access  increased access to formerly remote areas which might affect berry picking and other traditional uses  effect on non-consumptive recreation from increased workforce population in the region

Environmental Resource uses in the Land and Resource Use RSA include both renewable and non-renewable Setting resources. Renewable resource uses include forestry, hunting, trapping, fishing, berry-picking and other traditional land uses. Non-renewable resource uses include bitumen extraction, conventional oil and gas extraction, aggregate mining and other mineral extraction activities. Primary access into the region is via Highway 63 and Secondary Highway 881. Currently disturbed areas, including forestry areas, industrial sites, wellsites and linear features such as roads and seismic disturbances account for approximately 8.2% of the Land and Resource Use LSA. Portions of 13 Environmentally Significant Areas (ESAs) are located within the Land and Resource Use RSA. Eight provincially protected areas are found partially or wholly within the Land and Resource Use RSA.

2-29 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Land and Resource Use (cont’d)

Project Expansion Project components that may contribute to potential effects to Land and Resource Use Components include:  activities that could increase access to the area, such as construction of access roads and ROWs and activities that include vegetation clearing  activities that involve the use of aggregate resources  activities that could affect land use activities in the area through effects to wildlife, vegetation and fish and fish habitat  increased workforce population in the region

Effects Effects management measures include: Management  maintaining appropriate buffers around environmentally important areas  integrating timber salvage, revegetation and harvest activities with forestry operators  reusing aggregate resources where appropriate  overlapping ROWs to minimize linear disturbances and the associated increases in access to formerly remote areas  instituting access control measures to reduce public access Also, mitigation for other VECs such as wildlife, vegetation and fisheries will minimize effects to resources associated with resource use in the area.

Residual No significant residual effects to land and resource use were identified. Effects

Visual Aesthetics

Assessment Visual aesthetics were assessed as follows: Method  Expansion Project features were identified which were anticipated to have the furthest viewable distance.  the Local Study Area (LSA) was developed as an 11 km radius from the Expansion Project OTSG stacks, which defines the limit of human recognition acuity and resolution acuity under ideal conditions of contrast and light (i.e. ability to see the stacks or other equipment related to the Expansion Project).  The RSA is the area that encompasses the area over which it may be possible to view the plumes from the various pieces of process equipment at the Expansion Project.  Relevant visual interest points were identified. Distance and relative use rankings were applied to the visual interest points.  Predictive models of baseline conditions and Expansion Project components were used to identify the associated visibility from visual interest points.  Rankings for those visual interest points that can view developments were applied to determine overall visual aesthetic effects for each interest point.  Change in visual aesthetic effects was evaluated due to the Expansion Project. The threshold of significance is determined by the visual effects rating and relative change associated with the Expansion Project.

Key Issues Visual effects associated with development are a growing concern for tourism in the region. The potential for increased visual effects is assessed with respect to both traditional land users and the potential for tourism in the area.

2-30 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Visual Aesthetics (cont’d)

Environmental The landscape has already experienced development that has affected visual quality. The Setting Demonstration Project includes three steam generating stacks that are 30 m high. The terrain in the area is relatively flat and the vegetation tends to be low in height and density, providing relatively open visibility of structures on the landscape. In addition, a large fire in early 2009 removed vegetation to the east of the Demonstration Project and Highway 63, opening the viewscape further.

Project For the assessment, seven once-through steam generator (OTSG) stacks for the Expansion Project Components were selected to be modelled at the local scale. Maximum emission plume heights from the same stacks were modelled on a regional level.

Effects The following mitigations can be implemented to reduce the Expansion Project’s potential adverse Management effects to visual aesthetics:  Using materials in stack construction that limit reflectance of light and reduce contrast with surroundings.  Planting treed buffers along the highway to block views of the CPF, stacks and potentially any plumes.

Residual No new visual interest points are affected by the addition of the OTSG stacks for the Expansion Effects Project. The extent of visibility of these stacks is only increased in areas that already experience affected visual quality, specifically along Highway 63 and the Horse Creek valley. One additional visual interest point is affected by the emission plumes from the Expansion Project. This point is far from the source and the effect is considered to be of low magnitude. The remaining visual interests points that have visibility of the plumes from the Expansion Project already experience affected visual quality.

Historical Resources

Assessment Field studies were conducted in 2001 and 2002 for the project proposed at that time. These studies Method included baseline assessment of the lease (2001) and detailed study of the project study area (2002). Prior to undertaking field studies in 2009, a model of archaeological potential was developed for the LSA. The model involved a combination of environmental variables that are reflective of archaeological potential, including elevation, slope, aspect, proximity to perennial waterbodies, and proximity to known historical resources. The model was used to guide the selection of field study target areas for the 2009 HRIA studies. Overall, the LSA is rated to be of low to moderate archaeological potential. During the 2009 HRIA, a total of 220 shovel tests were excavated in areas with moderate archaeological potential that had not been assessed during the earlier studies. A known historical resource site, located over 1 km from the Project Area, was revisited at the request of Alberta Culture and Community Spirit.

Key Issues The key issue for the assessment of effects to historical resources is the loss of information associated with historical resources sites. Loss of information could affect future understanding of past site use and cultural development and cultural relationships at the local and regional scales. Disruption of the contents and context of historical resources can be either a primary or secondary effect. Primary effects result from direct disturbances to sensitive areas leading to loss of context or content. Secondary effects are the result of indirect disturbances that can occur because of improved access to sensitive areas. Improved access, combined with public knowledge of the historical resource potential of an area, could lead to unauthorized collection, excavation, disturbance or vandalism of historically significant sites.

2-31 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Historical Resources (cont’d)

Environmental No historical resources sites were identified during the 2001 and 2002 studies. Setting Within the RSA, a total of 59 historical resources sites are on record, including 33 precontact archaeological sites and 26 historic period sites, including the two new sites identified in 2009 as a result of the project Historical Resources Impact Assessment (HRIA). Precontact site types on record in the RSA include isolated artifact finds, lithic scatters, lithic workshops and campsites. Historic site types on record include dwellings, foundations, dumps, trails and a cemetery. Of these 59 sites, 29 appear on the Listing of Historic Resources indicating that they are of moderate to high heritage value and require further study prior to any impact. It is expected that the two newly recorded sites will be added to this Listing, bringing the total number of significant sites in the RSA to 31 out of 59 sites on record. With respect to the palaeontological resource potential of the area, the project area is low lying and wet, underlain by bedrock of the Cretaceous La Biche Formation. The La Biche Formation is a sparsely fossiliferous marine shale with moderate palaeontological potential. The bedrock is blanketed in thick surficial deposits, ranging from 30 to 135 m thick, except in the eastern limit where deposits average 15 m thick. Surficial deposits consist mainly of glacial till and colluviated ground moraine, with meltwater channel deposits around Horse Creek.

Project The clearing of vegetation in the Project Area can affect historical resources by disrupting or Components removing the sediments where historical resources may exist; archaeological and historic period sites are often located on or relatively near the ground surface. Thus, interactions can occur between construction activities related to surface preparation and historical resources.

Effects As no known historical resources sites will be affected, no mitigation measures are deemed Management necessary. The HRIA permit report recommends that sufficient HRIA studies have been conducted for the Expansion Project, and Historical Resources Act clearance is recommended for the Project Area.

Residual During the 2009 field study, two new archaeological sites were identified. Both of the new Effects archaeological sites identified during the studies are determined to be of moderate to high heritage value as they contain a variety of lithic artifacts in undisturbed context. The revisited site is of low heritage value as it lies in completely disturbed terrain within an existing pipeline ROW unrelated to the Expansion Project and the Demonstration Project. None of these sites lie within the Project Area. No archaeological or historic period sites are in conflict with the Project. There will be no impact to known historical resources sites as a result of the Project. The only area where bedrock may be disturbed is in Section 8-84-11 W4M, where the proposed powerline and future piperack utility corridor will cross a branch of Horse Creek in an area of steep terrain and thin surficial cover. As the bedrock is only sparsely fossiliferous, the likelihood of impacts to significant palaeontological resources is considered low.

Traditional Ecological Knowledge and Land Use

Assessment The LSA is the boundaries of the JACOS Hangingstone leases. The RSA is the combined Method traditional territories of Fort McMurray #468 First Nation and Chipewyan Prairie Déné First Nation, conjunction with the lands encompassed within the entirety of Métis Nation of Alberta Region I.

2-32 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Traditional Ecological Knowledge and Land Use (cont’d)

Assessment Traditional Ecological Knowledge (TEK), and from that an understanding of Traditional Land use Method (TLU), was obtained by the following: (cont’d)  an initial meeting with identified communities in combination with an extensive review of existing TEK/TLU information in the study region  review of previous EIAs and Traditional Land Use Studies  a TEK Workshop with Aboriginal community representatives and their environmental consultants to discuss concerns and interests  the creation of an ongoing meetings with the Aboriginal Review Group (ARG). a consultative body specifically created by JACOS and the Aboriginal stakeholders to provide input and feedback on the Expansion Project The key indicators representing traditional land uses in the RSA include:  water  air  harvested resources  landscape fragmentation  noise/light  safety  individual and community well-being  access to land  impacts to heritage and identity  land base  cultural landscape  language  inequitable distribution of benefits  regional cumulative effects

Key Issues Key issues for Traditional Ecological Knowledge and Land Use include the potential for the Expansion Project to affect Aboriginal peoples’ traditional land use and potential effects to areas of cultural significance.

Environmental The Expansion Project is situated within the asserted traditional lands of the following First Nations: Setting  Fort McMurray #468 First Nation  Chipewyan Prairie Déné First Nation The three Métis Locals in closest proximity to the Project are included in Métis Nation of Alberta, Region 1. The following Métis Locals were included in the TEK/TLU study program:  Fort McMurray Métis Local #1935  Willow Lake Métis Local #780  Chard Métis Local #214 There are four Registered Fur Management Areas (RFMAs) partially situated within the JACOS lease area. Three of the RFMAs are registered to Aboriginal trappers. Aboriginal trappers affected by the Project, have been included or invited to participate in the TEK/TLU study program.

2-33 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Traditional Ecological Knowledge and Land Use (cont’d)

Project All components of the Expansion Project have the potential to affect TLU. Components

Effects All proposed environmental management measures have the potential to minimize potential effects Management on TLU.

Residual Through ARG, JACOS intends to continue dialogue with Aboriginal Groups to address their Effects concerns throughout all phases of the Project.

Human and Ecological Health

Assessment The evaluation of potential effects on human and ecological health is first based on the results of Method the assessment of other VECs. This information is then analyzed within a Human Health and Ecological Risk Assessment (HHERA). The HHERA is composed of the following major steps:  Site Characterization/Modelled Predictions: a review and compilation of existing information, a review of the major Expansion Project components and related activities, and a review of the findings of biophysical and land use studies completed for the Expansion Project.  Problem Formulation: identification of the potential chemical emissions that may pose a health risk, potential receptors (human and ecological), and relevant exposure pathways (e.g., inhalation of air contaminants) to develop a conceptual model describing the interactions between the Project and the environment.  Exposure Assessment: qualitative or quantitative evaluation of the likelihood or degree to which the receptors will be exposed to chemical hazards.  Toxicity Assessment: includes the identification of potential adverse effects associated with each COPC as a result of acute or chronic exposure and of published, scientifically reviewed toxicity reference values for each of the COPCs against which the receptor exposures can be compared.  Risk Characterization: qualitative or quantitative assessment of the health risk of each COPC to each receptor through the combination of the exposure and toxicity assessments  Uncertainty Analysis: a review of the assumptions and uncertainties associated with the risk estimation.  Recommendations: recommendations may be provided for either or both mitigation and monitoring that would reduce the potential risk. It was determined that emissions of chemicals of potential concern (COPC) to the atmosphere are the primary source and pathway for human and wildlife exposure to effects of the Expansion Project. Other potential releases (e.g., leakage of well fluids into potable aquifers) were considered to have a low potential to result in measurable changes to the environmental media and therefore not considered in the assessment of human and ecological health. Conservative, accepted methodologies were applied to the selection of the COPCs (e.g., those chemicals known to be emitted, those known to persist in the environment over time, and those know to bioaccumulate in the environment). The emission of these chemicals from SAGD facilities has been studied and emissions data for the various COPC were obtained from various sources. The HHERA relied on the results of air dispersion modelling to evaluate the health risks from direct inhalation exposure and to predict health risks via exposure from multiple environmental pathways. Canadian risk assessment guidance and regulatory benchmarks of acceptable risk were used for this assessment. Those documents were supplemented by methodologies developed by the United States Environmental Protection Agency (US EPA) and other agencies. This methodology is consistent with projects that have been reviewed in the past by provincial and federal health agencies for facility emissions risk assessment conducted in support of EIA studies in the oilsands region.

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Table 2-1 Summary of Environmental Effects (cont’d)

Human and Ecological Health (cont’d)

Assessment Effects on Human Health relates to people living in the LSA (including Aboriginal residents) and also Method for those individuals who use the LSA for residential and recreational purposes (e.g., hunting, (cont’d) fishing and camping); it does not include Project construction or operational worker health. Workers employed for the Project will be protected by applicable Occupational Health and Safety laws of the Province of Alberta. Limited existing studies concerning baseline soil and vegetation conditions were identified within 20 km of the site. As a result, field sampling programs were initiated in order to better characterize baseline conditions at the site. Baseline sampling consisted of the evaluation of three types of media: air, soil and traditional edible vegetation. Baseline soil conditions were characterized through the sampling of 10 sites located within the LSA. Samples were analyzed for PAHs and inorganic compounds due to their high degree of persistence in the environment (e.g., greater than 182 days). Baseline vegetation conditions were characterized through the sampling of 17 sites located within the LSA. Sites were selected in the field that had good populations of the target collection species (e.g., blueberry (Vaccinium myrtilloides) and Labrador tea (Ledum groenlandicum). Companion soil samples were also collected at each site. Like soils, vegetation samples were analyzed for PAHs and inorganics. Using baseline soil concentrations, the risk assessment chemical fate and transport model was used to predict baseline concentrations in other media relevant to the assessment, including small mammals, wild game, and garden produce. Local Study Area (LSA) The LSA is the same as the air quality LSA. Specific receptor locations within the LSA were assessed. The selection of these locations incorporated consideration of land use, preliminary air modelling results, and input from consultation. In addition, the assessment included the maximum predicted air concentrations at the fenceline of the CPF. Regional Study Area (RSA) The RSA is the same as the air quality RSA.

Key Issues The potential environmental and health issues include:  change in human health  change in ecological health

Environmental The environmental setting is the same as provided for the other VECs. Setting

Project Project components that may cause human or ecological health effects include: Components  operation of the main processing facility  bitumen and diluent storage and management during operations  emergency flaring, failure of emission control equipment, pipe rack leak or explosion, and gas releases

Effects Effects management measures are the same as those proposed for air quality. Management

2-35 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Human and Ecological Health (cont’d)

Residual Effects The cumulative health risk estimates associated with acute and chronic exposures to emissions of COPCs (a total of 48 chemicals) via inhalation and oral and dermal contact were less than the applicable benchmark for each of the chemicals, with the following exceptions.

 Elevated 24-hour exposures to PM2.5 and hydrogen sulphide, and annual average exposures to acrolein are generally limited to the communities of Fort McMurray and Fort MacKay, each of which are located more than 50 km from the Expansion Project. The assessment demonstrated that the contribution of the Expansion Project to these elevated concentrations was negligible.  The maximum 24-hour concentrations of acrolein are higher than the regulatory limit throughout much of the region; however, the assessment indicates that the contributions of the Expansion Project to acrolein concentrations are negligible. The lowest concentration at which mild eye irritation has been observed in humans (i.e., 140 µg/m3) is more than 100- times higher than the maximum modelled 24-hour air concentration of acrolein at the receptor locations and as such, it is unlikely that the concentrations of acrolein would result in a substantive health risk. The human health risks associated with each of the metals expected to be released as a result of Expansion project activities (chromium, cobalt, lead, manganese, and zinc) did not change through all assessment cases, indicating that contributions from the Expansion Project and other planned projects are negligible. The human health predictions incorporate background soil and traditional foods concentrations. The inclusion of the background soil concentrations in the model means that the conservative transport equations and uptake factors were used to predict the concentrations of COPC in other environmental media (e.g., garden produce), which would likely overestimate the actual concentrations. Health risk estimates for all mammalian and avian receptors were below the target benchmarks change through all assessment cases. Therefore no unacceptable risks were predicted from exposure to chemical concentrations in the environment. For community-based receptors (i.e., terrestrial plants and soil invertebrates), exposure to manganese through all cases were higher than target benchmarks. However, contributions of chemicals from the Expansion Project were deemed to be negligible compared to background concentrations. The risk estimated for community-based receptors is solely the result of existing background soil concentrations in the LSA. Background soil concentrations within the LSA are not expected to differ from other rural areas in Alberta or result in risk to vegetation or invertebrate communities, a conclusion that is supported by the evidence of healthy and diverse vegetation communities observed within the LSA.

Socio-Economics

Assessment Socio-Economic effects were assessed at a regional scale, with the RSA being defined by the Method boundaries of the Regional Municipality of Wood Buffalo (RMWB). Estimated population increases due to the Expansion Project were used to predict effects to housing, social services and infrastructure. Effects to traditional land use and culture as a result of increased socio- economic pressures were addressed in a summary fashion, with acknowledgement of the detailed analysis presented in the Traditional Ecological Knowledge and Land Use assessment.

2-36 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Socio-Economics (cont’d)

KeyIssues The keysocio-economicissues included:  Employment, economic and fiscal effects, consisting of:  labour force, including availability and sourcing  regional and provincial economic benefits, including employment and business income  fiscal benefits, including government tax and royalty income  Population effects  Effects of population changes to regional social and municipal infrastructure and services, including:  housing, including availability of worker housing and affordable housing  services relating to policing, emergency, health, social, education and recreation  municipal services and infrastructure  Transportation network  Traditional land use effects, including fishing, hunting, trapping, cultural and religious practices.

Environmental Oil sands development in the RMWB has led to strong population growth in the RSA. The number Setting of people in Fort McMurray has increased from about 34 000 in 1996 to 72 360 in 2008. Rural populations have grown as well, although at a lower rate. Anzac, Fort MacKay and Saprae Creek were the fastest growing rural hamlets. On-reserve populations have been relatively steady over this period. Population increase in the RMWB has led to increased demand for municipal infrastructure and services. The RMWB’s capital budget increased from $310 million in 2008 to $537 million in 2009 and the operating budget increased from $290 million to $518 million. Additional population will require additional investment in municipal infrastructure, much of which is committed and under construction. Infrastructure in rural communities is also expanding. Anzac is now connected to a regional water line and plans are underway to develop water distribution and wastewater collection systems. Highway 63 is the primary link between Fort McMurray and population centres to the south. Secondary Highway 881, which intersects with Highway 63 roughly 20 km south of Fort McMurray, serves as the other highway connection to destinations south of the RMWB. Traffic volumes over the last five years have increased by approximately 13% per year on highway segments between the southern boundary of the RMWB and Fort McMurray. The Federal Government has committed to twinning Highway 63, from Fort McMurray to Grassland, roughly 180 km north of Edmonton. Traditional land use and culture remain essential to First Nations and Métis people. With the increasing importance of the wage economy and reduced availability of land for traditional uses, the function of traditional land use is becoming more cultural than economic. Traditional cultural and environmental knowledge is also changing from a mostly oral and activity-based tradition to greater emphasis on systematic documentation. Aboriginal communities in the region have responded in various ways. A number of Industrial Relations Corporations (IRCs) have formed with the support of industry funding. One of the purposes of IRCs is to help provide information and capacity for Aboriginal communities to take advantage of business and employment opportunities linked to oil sands developments in the region. Other non-economic related interactions occurring between industry and First Nations and Métis in the region include traditional land use studies, ecological knowledge initiatives, participatory human health studies and oral history projects.

2-37 Summary Report: Environmental Impact Assessment Section 2: Assessment Summary April 2010

Table 2-1 Summary of Environmental Effects (cont’d)

Socio-Economics (cont’d)

Project Key considerations are capital construction and annual operating cost estimates, construction Components workforce, permanent operations hires and degree of local employment and contracting.

Effects Management of employment, economic and fiscal effects includes: Management  workforce sourcing and housing strategies  regional workforce and business development support  procurement strategies Management for effects to population and housing includes:  use of construction and operations camps  continued participation in the Oil Sands Developer Group (OSDG)  a regional based hiring focus, where appropriate  housing incentives for employees  communication with stakeholders Management for effects to municipal and social infrastructure includes:  project water and sewer system  use of construction and operations camps  employee health and benefits program  onsite industrial nursing, EMT and security services  emergency response plan and regional cooperation  company contributions and support to regional social, health, education, Aboriginal and recreation initiatives Mitigation and monitoring for effects related to increased transportation pressure includes:  use of construction and operations camps  ridesharing  information sharing and coordination with regional and provincial bodies Effects management for Socio-Economic pressures on Traditional Land Use and Culture includes:  compensation to trappers with affected traplines  continuing consultation  planning for progressive reclamation  continuing the ARG process

Residual Effects In all cases, residual effects due to the Expansion Project are expected to be minor and not significant. The Expansion Project contributes to the cumulative effects of the projects included in the Planned Development Case. However, the contribution by the Expansion Project to the cumulative effects is expected to be minor.

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