Pacific Future Energy Corporation - LBCG€¦ · PACIFIC FUTURE ENERGY CORPORATION • We are...

GAINING “SOCIAL LICENCE” IN BCPACIFIC FUTURE ENERGYNear Zero Net Carbon Emission Refinery

BRITISH COLUMBIA, CANADA

Mark MarissenChief Strategy and Communications Officer

(c) 2015 Proprietary and ConfidentialPACIFIC FUTURE ENERGY CORPORATION

PACIFIC FUTURE ENERGY CORPORATION

• We are building the world’s greenest refinery on the northwest coast of British Columbia in full partnership with First Nations

• Our mission is to open up market access for Alberta bitumen to Asianmarkets via British Columbia

• Efforts to date by others have failed or stalled due to a failure to obtain “social licence” in British Columbia

• We believe “social licence” or “permission” must be gained at the concept stage of any project, and earned throughout the regulatory process

• We are on track to file our Project Description by the end of this year

Building Our Future, Protecting Our Coast

2(c) 2015 Proprietary and Confidential

Executive Chairman SAMER SALAMEHMr. Salameh previously managed the Telecom practice and New Business Development at Grupo Salinas, a $7 billion industrial conglomerate operating in 11 countries in the Americas. He has extensive management experience in the development and deployment of complex infrastructure projects for some of the world’s leading investors.

Chief Operating OfficerJACQUES BENOIT Jacques Benoit brings over 35 years of work in the oil & gas space, managing environmental assessment and regulatory approvals and overseeing large projects. Jacques was most recently at SNC Lavalin, where he was a senior manager with over 1200 direct reports.

Senior Strategic Advisor & Chairman, Strategic Advisory Board HON. STOCKWELL DAY P.C.The Hon. Stockwell Day, PC, is Canada’s former Minister of International Trade and Minister for the Asia-Pacific Gateway, former leader of Canada’s Official Opposition (succeeded by Stephen Harper) and former Treasurer (Minister of Finance) and Acting Premier of the province of Alberta.

Chief Strategy and Communications OfficerMARK MARISSENA noted political strategist for both a former Prime Minister of Canada and a former Federal Leader of the Official Opposition, Mr. Marissen was national campaign co-chairman for the Liberal Party of Canada in the 2008 Federal election, and British Columbia co-chair for the 2004 and 2006 elections.

Senior Strategic Advisor, Partnership CHIEF SHAWN A-IN-CHUT ATLEOMr. Atleo served as the National Chief of the Assembly of First Nations from 2009 to 2014. In addition to his management responsibilities with Pacific Future Energy, Mr. Atleo serves as an Adjunct Professor at the University of Toronto’s Ontario Institute for Studies in Education, as well as an advisor to Vancouver Island University.

Executive Vice-President, External Relations & Regulatory Affairs JAMES CARROLLAn advisor to two Prime Ministers, Mr. Carroll also has provided strategic guidance to Shell Canada, PetroCanada, Suncor, Imperial/Exxon, Ultramar, Valero, TransCanada Pipelines and the Aboriginal Pipeline Group (APG) related to their respective regulatory obligations, business planning and/or securing government support for their projects.

Chief Executive Officer ROBERT DELAMARMr. Delamar has spent the past decade building and growing blue-chip venture capital and private equity backed companies around the world. He is a member of the Law Society of British Columbia.

Executive Vice President, Partnerships and Sustainability HEATHER SQUIREAn experienced negotiator among First Nations in British Columbia and nationally, Heather has a strong background in communicating with First Nations communities and securing agreements on development and energy projects.

Project Delivery Team that Meets Today’s NeedsFirst Nations, Regulatory, Political And Financial


Chief NegotiatorMICHAEL BONSHORMichael is a member of the Dzawada'enuxw First Nation of Kingcome Inlet. He brings 20 years of experience working with First Nation across Canada in key areas of economic development, business governance and development, negotiations with industry and government, strategic planning, capacity development/training and land and resource management.

The Hon. Stockwell Day, PC, Chair of the PFEC Advisory Board, is Canada’s former Minister of International Trade and Minister for the Asia-Pacific Gateway and Regional Minister for BC. He was also the Leader of Canada’s Official Opposition, succeeded by Stephen Harper when the Canadian Alliance and Conservative Parties united. Prior to that he served as Treasurer (Minister of Finance) and Acting Premier of Alberta.

Jack C. Donald injected the "upstream" exploration sector's streak of entrepreneurial independence into "downstream" refining and retailing from his home base in Red Deer. Starting with two gas stations and a truck in 1977, he built Parkland Industries into a chain spanning western and northern Canada with 454 retail locations, a trucking fleet and a former Shell refinery at Bowden, Alberta.

Chief Robert Louie, LL.B., OC, of Kelowna, B.C. is the Chief of the Westbank First Nation. He is also the Chairman of the First Nations Lands Advisory Board and Board of Director member of Peace Hills Trust (Financial Institution). He served as a Board of Governor member with the University of British Columbia and as a member of the President’s Advisory Council of the University of British Columbia Okanagan (UBC-O).

Ovide Mercredi is a Cree born in the northern community of Grand Rapids. He served his community as Chief of MisipawistikCree Nation from 2005 to 2011. A graduate of the University of Manitoba with a Law degree he practiced criminal law and laterspecialized in constitutional law as an advisor to Manitoba Chiefs. Mercredi has worked tirelessly for the rights of First Nations people throughout Canada. He was National Chief for the Assembly of First Nations from 1991 to 1997. He is currently the President of the Manitoba New Democratic Party.

Dave Coles is President Emeritus and a founding member of Unifor, Canada's newest and largest private sector trade union. Mr. Coles was previously the longest serving President of the Canadian Communications, Energy and Paperworkers union (CEP), which represented 30,000 energy workers who worked in the bitumen sands and many refineries in Alberta. Mr. Coles has fought for many environmental causes, and led campaigns for Canada's natural resources to be processed in Canada. He has also spoken internationally on energy, environmental, and labour issues.

ADVISORY BOARD Business, Labour, First Nations

Strategic Investment by SNC-Lavalin

• SNC Lavalin is a worldwide leader in engineering, procurement, construction and construction management services with close to $10 billion in annual sales

• SNC is the 8th largest global design firm• SNC is both a strategic investor (through A-in-Chut Business Group) and

main EPC contractor• Their partnership with us is a demonstration of national corporate

leadership

SNC’s Role: Finance and Primary EPC Contractor Through Life of Refinery


Canada’s Annual $20 Billion Problem

• Third largest oil reserves in the world are trapped • 97% of Canadian oil exports head to one customer - the USA• This customer will become increasingly self-sufficient in years to come.• “Un-Stranding” Albertan crude has been a top priority for both the Federal and Alberta

Governments for the past 6 years• Best possible market is Asia, the only market in the world that is projected to grow

Canadian Oil Needs Asian Market Access


Crossing the Pacific is not the Problem

13 days to Shanghai10 days to Tokyo


The Issue is Crossing British Columbia

• Main efforts have all focused on building new pipelines from Alberta to British Columbia

• These efforts have failed or have stalled due to opposition from First Nations and public concern with shipping bitumen from the BC coast

• PFEC’s proposed refinery, in full partnership with First Nations, provides the solution

.


Our Solution

• Pacific Future Energy is building a 200,000b/d export refinery on the Northwest coast of British Columbia

• Built in modules in Asia, assembled near tidewater in Canada – which cuts down cost considerably• Our approach - obtain First Nations and Community support (“social licence”) before starting the

permitting process and throughout• Refinery is not pipeline dependent – on rail route -- bitumen can be shipped like asphalt – more

economically and safely than pipeline -- not analogous to rail shipments in Quebec• A refinery fulfills the stated policy goals of all levels of government (First Nations, Federal Govt,

Alberta Govt, BC Govt) and key stakeholders (Greens, labour, industry)

PFEC’s North Coast, Near Zero Net Carbon Export Refinery On the BC Coast


Our Site• Northwest BC• Will be announced shortly • Executed key MOU with local First

Nation - the traditional rights and title holder

• Further MOU with local Economic Development Agency

• Active CN Rail line through site• Inactive 6” and 10” gas lines

running adjacent to site• Heavy haul routes identified for

bringing modules to site for construction


Project Timeline to Permit (Permission)


Economics not the problem

• Our economic model has been validated by two reputable third parties: Deloitte and Aegis Energy Advisors


“This oil refinery will be profitable. Diesel will be the highlight and it is highly sought after,” [said Ron Loborec, Canadian energy leader at Deloitte & Touche LLP.]

Prices for benchmark Western Canadian Select heavy oil are lower than those for West Texas intermediate light crude, so that provides a further cushion for the planned B.C. refinery to have cheaper costs for supplies, Mr. Loborec said.”

The Key to Resource Project Development Success is “Social Licence”

• What does it mean?• How do you know who has it?• Who best understands who has it or does not have it?• How do you keep it?


PERMISSIONPermission is required, at various levels

• From First Nations • From Federal and Provincial Regulators• From General Public • From Funders

Permission:• Requires us to take the time to build the

relationships with our First Nations partners, regulators and the community

• It is built on trust


Permission• Partnerships• Funding• Engineering• Community

support

Relationships

BC Opposition to Projects


Public Support for BC Refinery Holds, Opposition Decreases


Strong local support


“Value Add” and Environmental Responsibility are Key


Crude Oil and Bitumen Seen as Equally Dangerous to Aquatic Environment


British Columbia’s Five Conditions

Include:1. Successful completion of environmental review process2. World leading oil spill response3. World leading practices for land oil spill prevention4. First Nations legal requirements and treaty rights addressed5. BC gets its “fair share” of economic benefits

Reflect political realities in British Columbia• First Nations environmental, legal and procedural concerns (e.g.,

inclusion, land rights, sovereignty)• Deep connection to coastal waters• Resource dependent, but not on oil• Historic support for “green” movements (e.g., Greenpeace, David

Suzuki, etc.)

The “Five Conditions” need to be treated as a pathway to success, rather than a roadblock

PFEC uniquely helps to satisfy these conditions


British ColumbiaFirst Nations

• First Nations coastal culture and traditional way of life linked to and defined by relationship to natural environment, especially water

• Only part of Canada where there are (virtually) no treaties in place. Treaty process ongoing.

• Relationship between First Nations and BC government still evolving

• Focus on fisheries, especially salmon• Any risk to waterways – the Fraser, the

Skeena, the Douglas Channel and the Hecate Strait – are seen as existential threats to their way of life


• Since the Tsilhqot’in Decision in July 2014, the law is clear: – First Nations have a claim to any non-treaty land

in the province when a proposed action may impact the economic benefit derived from the land


British Columbia First Nations Legal Considerations

22

Alberta Government


- Understands BC political environment

- Wants to build refinery capacity

- Wants to create union jobs

- More cooperative approach than Redford’s initial fight with BC

Federal Government

- New Government, New Approach- Extension of Tanker Moratorium on

North West Coast- Moratorium is for crude oil, not refined

products

- Liberals and NDP increased vote share in coastal communities

- More “arms-length” relationship with regulatory process

- PFEC helps to address key environmental and social issues


Conclusion & Summary1. Our project will create a new opportunity for bitumen producers to access Asian markets

1. The social/political/legal/regulatory environment in BC is completely different from Alberta and requires a different approach

• The logical way to satisfy BC’s key conditions is to build a bitumen refinery in BC on or near the coast

• Our team is uniquely positioned to deal with these challenging issues

2. Regulatory issues have delayed construction of pipelines. Our refinery will not be pipeline dependent.

• The Shipping of NeatBit (essentially Asphalt) is much safer than DilBit and eliminates need for diluent return

3. We are proving our approach gets projects done in British Columbia – in partnership with First Nations

• Key MOU’s and relationships are moving our project through the approval process

4. We look forward to working with Alberta producers as our project continues to move forward• Providing Political, First Nations and Regulatory strategy to open new markets


GAINING “SOCIAL LICENCE” IN BC�PACIFIC FUTURE ENERGY�Near Zero Net Carbon Emission Refinery�BRITISH COLUMBIA, CANADA��Mark Marissen�Chief Strategy and Communications OfficerPACIFIC FUTURE ENERGY CORPORATIONProject Delivery Team that Meets Today’s Needs�First Nations, Regulatory, Political And FinancialSlide Number 4Strategic Investment by SNC-LavalinCanada’s Annual $20 Billion ProblemCrossing the Pacific is not the ProblemThe Issue is Crossing �British ColumbiaOur SolutionOur SiteProject Timeline to Permit (Permission)Economics not the problemThe Key to Resource Project Development Success is “Social Licence”PERMISSIONBC Opposition to ProjectsPublic Support for BC Refinery Holds, �Opposition DecreasesStrong local support“Value Add” and �Environmental Responsibility are KeyCrude Oil and Bitumen Seen as Equally �Dangerous to Aquatic EnvironmentBritish Columbia’s �Five ConditionsBritish Columbia�First NationsSlide Number 22Alberta Government�Federal Government�Conclusion & Summary

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