To conduct engineering feasibility study of using CanmetENERGY HiPrOx DCSG technology in SAGD process.

ADVANCE CONTRACT AWARD NOTICE (ACAN) 1. Definition An Advance Contract Award Notice (ACAN) allows departments and agencies to post a notice, for no less than fifteen (15) calendar days, indicating to the supplier community that it intends to award a good, service or construction contract to a pre-identified contractor. If no other supplier submits, on or before the closing date, a Statement of Capabilities that meets the requirements set out in the ACAN, the competitive requirements of the government's contracting policy have been met. Following notification to suppliers not successful in demonstrating that their Statement of Capabilities meets the requirements set out in the ACAN, the contract may then be awarded using the Treasury Board's electronic bidding authorities. If other potential suppliers submit Statement of Capabilities during the fifteen calendar day posting period, and meet the requirements set out in the ACAN, the department or agency must proceed to a full tendering process on either the government's electronic tendering service or through traditional means, in order to award the contract. 2. Definition of Requirements Background and Project Description: CanmetENERGY-Ottawa has been conducting research of high pressure oxy-fuel (HiPrOx) combustion technology since 2007. A unique application of HiPrOx combustion technology is bitumen extraction from the Canadian oil sands industry by direct contact steam generation (DCSG). HiPrOx DCSG can use steam-assisted gravity drainage (SAGD) produced water and/or mature fine tailings water (tailings pond water) without pre-treatment and generates a hot flue gas with a steam content up to 90 % by volume at high pressure (80 bar or higher). The steam/CO2 product can then be directly injected into the ground for bitumen production in the SAGD process. HiPrOx DCSG technology has attracted great interest from the Canadian oil sands industry. Currently, CanmetENERGY is conducting a multi-million dollar HiPrOx SAGD project for Suncor. In order to ensure the success development of this highly sophisticated technology, CanmetENERGY needs to work with an industry partner to fully understand the current SAGD operation and to conduct engineering feasibility study of utilizing CanmetENERGY’s HiPrOx DCSG technology in SAGD process. Therefore, it is imperative that CanmetENERGY has an industrial expert to provide in-depth information about the current SAGD process and carry out feasibility study of the operation of using CanmetENERGY HiPrOx DCSG technology in the SAGD process. This service will ensure that CanmetENERGY will foresee any technical issues and identify great potentials, such as CO2 retention in reservoir, of this very promising technology. The Vendor is an engineering consulting firm with extensive expertise in conducting engineering feasibility study. They are especially noticed for their work in the oil sand industry. In 2010, they were invited to give a tutorial course to a group of industry process engineers about modeling heavy oil extraction using Aspen Hysys. OBJECTIVES To conduct engineering feasibility study of using CanmetENERGY HiPrOx DCSG technology in SAGD process. This will be carried out by first developing a detailed and in-depth process simulation model of current operation of SAGD process, then replace the steam generation section with CanmetENERGY proprietary DCSG technology Deliverables: Task: Aspen Hysys model for current SAGD process which includes sections of but not limited to: 1. steam generation; 2. well pad; 3. gas-oil-water separation; 4. gas treatment; 5. oil treatment; 6. water treatment. Aspen Hysys SAGD model for CanmetENERGY HiPrOx Direct Contact Steam Generation (DCSG) Technology - Task 1: Fluid Characterization Aspen Hysys SAGD model for CanmetENERGY HiPrOx Direct Contact Steam Generation (DCSG) Technology - Task 2: Reservoir Modeling. Aspen Hysys SAGD model for CanmetENERGY HiPrOx Direct Contact Steam Generation (DCSG) Technology - Task 3: Water Treatment and Amine System. Time Schedule: Five weeks after contract is awarded. Constraint: The model should reflect up-to-date technologies being used in SAGD operation and be used as a baseline case for further study. The reservoir model should be a seamlessly extension integrated into Aspen Hysys. Reporting Requirements Bi-weekly progress report has to be provided by the contractor to CanmetENERGY. The report should consist of brief description of new progress together with plans for the next period. Any completed sections of the SAGD model are required to be included in the progress report. The final reporting requirement of this contract is the two SAGD process models plus a technical report describing the model configuration, operating parameters, and reference. Method and Source of Acceptance All deliverables and services rendered under any contract are subject to inspection by the Project Authority. The Project Authority shall have the right to reject any deliverables that are not considered satisfactory, or require their correction before payment will be authorized. 3. Trade Agreements There is no trade agreement impacted with this contract. 4. Title to Intellectual property The contract will result in the development of intellectual property 5. Contract Period The contract period will be from Contract Award to March 31, 2016. The estimated period of the contract is 13 weeks from the date of Contract Award to the end data. 6. Estimated Cost The estimated maximum value for this contract is $45,000.00 CAD plus of applicable tax 7. Exception to the Government Contracts Regulations and applicable trade agreements (d) Only one person or firm is capable of performing this contract. ProcessEcology Inc. is the only known company that:

has demonstrated the pre-requisite deep knowledge of process simulation and highly specialized experience in steam-assisted gravity drainage (SAGD) process – based explicitly on required evidence of such expertise, namely: presentations & training (tutorial) they alone have given on this subject and is understood to be able to provide the services without divulging company confidential information. (see next paragraph)

(Note: Although big oil sand companies were approached, it was discovered that they would not be in a position to provide such services since they would have to expose their process operating conditions and data. Those factors are deemed company 8. Name and Address of the Proposed Contractor Process Ecology Inc.Unit 930, 710-20 Crowfoot Crescent NW,Calgary, Alberta T3G 2P6 9. Inquiries on Submission of Statement of Capabilities "Suppliers who consider themselves fully qualified and available to provide the services/goods described herein, may submit a Statement of Capabilities in writing, preferably by e-mail, to the contact person identified in this Notice on or before the closing date and time of this Notice. The Statement of Capabilities must clearly demonstrate how the supplier meets the advertised requirements and deliverables." 10. Closing Date The closing date for a submission of a Statement of Capabilities is January 13, 2016 at 14:00 Mountain Standard Time. 11. Contracting Authority Kingsley Okosun5320 122nd Street, Edmonton AB. T6H 3S5Telephone: 780-435-7208kingsley.okosun@canada.ca