APPENDIX G JVOPS Test Oil Specifications and Rheology Analysis Report

Test Product Supply Contractor Breco Innovation, Inc.350 Boul, Ford, Suite 130 Chateauguay, Quebec J6J4Z2 (450) 698 2810 navenco@sympatico.ca POC: Todd Mitchell Marketer for Test Product Foundation Engergy, Inc. 1000 520 5th Ave. S.W. Calgary, Alberta T2P 3R7 POC: Terry Kemp Source of Test Product Japan Canada Oil Sands Ltd. Suite 2400, Standard Life Building 639-5th Avenue S.W. Calgary, Alberta T2P 0M9 Plant Address: JCOS Field Office Hangingstone P.O. Box 5120 Fort MacMurray, Alberta T9H 3G2

APPENDIX G SECTION 2 RHEOLOGICAL PROPERTIES OF THE JAPAN CANADA OIL SANDS BITUMEN CRUDE OIL USED DURING THE JVOPS OIL PUMPING TESTS IN HOUMA LA 2003 By Craig Moffat, GPC The following graphs and charts completely summarize the test results performed on the Canadian Tar Sands Bitumen that was used in the testing of the JVOPS viscous oil pumping exercise in Houma LA 2003. The oil arrived on the test site in October 2003 with an average temperature of between 100 F and 190 F. The oil had been shipped from Canada via rail, and reheated and transported to trucks for delivery at the site. Once on site, the oil was placed in three separate tanks and with cooling aids applied it was cooled until late November when the testing began. The samples used in the rheological analysis enclosed in this report were taken as follows:

Sample labeled October ‘03 was taken from the bulk oil (Baker Tank) and represents the condition of oil used during the testing before introducing any outside water or heat sources.

Sample labeled CCG Tank 12-10-03 was taken from the CCG tank before testing started.

Test 0 & 00 sample was taken on 12-10-03 from the USCG tank before testing started.

Test #1 sample was taken on 12-11-03 from the USCG tank before testing started.

Test #2 & 3 sample was taken on 12-12-03 from the USCG tank before testing started.

Test #6 & 7 sample was taken on 12-12-03 from the CCG tank before testing started.

Test #4-3 & 4-4 sample was taken on 12-14-03 from the USCG tank before testing started.

All samples were taken using a dipping ladle that was plunged into the on-site oil tanks to a depth of approximately 2 feet. Any water found in the sample ladle was poured out prior to pouring (or scraping) oil into a sample jar. Samples were shipped to ESSM Base Cheatham Annex in Virginia where they were analyzed using a Brookfield RV-DVII+ Rotary Viscometer to develop viscosity temperature curves. In June 2004, the samples were sent to Intertek Caleb Brett to have water content by distillation (ASTM D95) and single point viscosity (ASTM D445) tests conducted on each available sample. These methods are common practice for measuring water and viscosity in commercial residual oils. The results of these tests are shown in Figures 1 & 2. Also in June, two new sets of viscosity tests using the Brookfield Viscometer at Cheatham Annex were conducted to test for the following:

1. Constant rpm/constant temperature over time to test for oil thinning or thickening (Thixotropy, Rheopecticity).

2. Viscosity verification at 122 F using the Rotary Viscometer to compare to viscosity derived using outside laboratory ASTM methods.

3. Viscosity check at constant temperature and varying shear rate (varying spindle speed) to check for plasticity or dilatancy of product and to compare the viscosity of the sample that has had all free water removed to pre-water removal viscosity.

OBSERVATIONS AND RESULTS The graphs in Figures 1 and 2 show the standard viscosity vs. temperature chart with both the actual data points and trend line plotting the viscosity. The trend lines that were applied to these graphs (blue line connecting the data points) were added using ‘curve fit’ software within Excel© and are a power type curve. The curves vary slightly between the high temperature end and the lower temperature end. The latest high temperature points are added to the upper range curve, which did not change it from curves produced prior to June. The graph shown in Figure 3 is a bar graph showing results of the high temperature, single point viscosity conducted by Intertek Labs. If one ignores the CCG 12-10-03 sample, it is obvious that the viscosities of the samples taken in the later tests were slightly higher than the viscosities of the earlier samples. In Figure 4, it can be seen that these later samples also have the higher water content. The average viscosity of the higher water content samples was greater than that of the lower water content samples. It must be noted that the CCG sample has a higher viscosity than the others but that with respect to overall viscosity range, it is a fairly small difference. The difference between the highest and the lowest viscosity was only 938 centistokes, which is about 14%. The difference between the highest viscosity and the average viscosity was only 2.6%. The rotary viscometer testing at CAX, done in comparison with the ASTM method resulted in viscosities of 8000 cSt (low shear/low rpm) and 7275 cSt at higher shear (higher rpm). If had continured to step up the spindle speed, the viscosity may have come down into the 6500 cSt range. This is important in that it confirms that the tests close to being on par with each other, albiet the ASTM test results result in a higher shear rate than the .07 sec-1 rate at which we have done for all previous JVOPS test samples. The water content results shown in Figure 4 clearly show the chronologic increase in water uptake from test to test. The highest figures are the last test sample (12-14-03) that was 9.5% water before free water removal and 8% after removal. Based on the viscosity testing, however, the viscosities slightly increased as the water content increased, indicating that the non-free water level found in the oil was in the form of an emulsion and resulted in a slightly higher viscosity. That is based on the results from the rotary viscometer. The effect that this had on a higher rpm rotating pump screw may not be the same but intuitively it would be the same. The difference in viscosity between samples with higher water content and those without water was only on the order of +2% for the ASTM tests and about +3.5% for the rotary viscometer tests. Thus, the most important result of this information is the fact that there was not a decrease in measured viscosity as a result of the water uptake from AWI.

Figure 5 shows the results of the constant shear rate-constant temperature testing. The purpose of these tests was to determine if the bitumen test product would thin out over time or thicken over time while undergoing a constant shear rate (rpm). Many oils will show a gradual decrease in viscosity over time in these conditions, which makes them thixotropic. The bitumen, however, not only did not lower in viscosity but slightly increased in viscosity over time. This increase would be a called Rheopectic tendency, but the increase was so small that we will consider this a “no change” in viscosity result. The shear rate increase tests (Figures 7 and 8) were done to determine if the oil exhibited shear thinning or thickening. As would be expected, the oil thinned as shear rate increased similar to the behavior of common resdiual oils. Following these charts as the spindle speed increased, the oil viscosity decreased and then stabilized at the new shear rate. Thus, as one increases the speed of the pump, the oil will reduce in viscosity to a slightly lower level, but will then maintain that relative viscosity so long as the rpm is constant. SUMMARY OF RESULTS The Japan Canada Oil Sands (JCOS) Bitumen Crude Oil properties as tested are as follows:

1. The Bitumen has normal (as in residual oil normal) pseudo-plastic characteristics (its viscosity decreases proportionally to an increase in shear rate).

2. The Bitumen tested at JVOPS took on water and bound it in emulsion within the oil in linear proportion to the quantity of water injected in the form of AWI over time. Water content began at (0.1%) for base oil and increased over testing time to 8.20% for the last test series sampled.

3. The increase in bound water content from the base sample to the final average of Bitumen samples resulted in a 1% average viscosity increase in the measured oil samples.

4. The Bitumen does not display any thixotropic characteristics (it does not decrease viscosity at constant shear rate and temperature).

5. The Bitumen shows only marginal rheopectic characteristics (it increases viscosity over time when subjected to constant shear rate).

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All available oil samples from the JVOPS 2003 tests in Houma were sent out to an outside laboratory to be tested for water content and viscosity in June 2004. The lab could only test for viscosity at one temperature and due to the high viscosity of the product they had to use the highest standard temperature listed in the test procedure, which was 50 C (122 F). The lab report information was transcribed onto the table shown below for comparison. Sample Name Water Content %

Before Draining Free Water ASTM Method D95

Water Content % After Draining Free Water ASTM Method D95

Viscosity cSt @ 122 degrees F Before Draining Free Water ASTM Method D445

Sample From Oil Delivered in October 2003

(0.10) No Free Water 6089

Canadian Coast Guard Tank 12-10-03

(1.60) (0.90) 6865

Test 0 & 00 USCG 12-10-03

(0.80) (0.50) 6299

Test #1 USCG 12-11-03

(2.40) (1.20) 5927

Test 2 & 3 USCG 12-12-03

(5.8) (5.9) 6551

Test 6 & 7 CCG Tank 12-12-03

(3.80) (3.10) 6456

Test 4-3 & 4-4 USCG 12-14-03

(9.50) (8.20) 6535

Intertek Testing Services, Caleb Brett, 11872 Canon Blvd., Suite E, Newport News, VA, 23606 performed lab analysis. Their phone number is 757-873-0133. Contact Aziz Khawaja at PO number 52021/v 6/17/04.

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