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News Release

FOR IMMEDIATE RELEASE

ERCB COMPLETES SHELL PIPELINE INCIDENT INVESTIGATION REPORT

Calgary, Alberta (October 7, 2008) The Energy Resources Conservation Board (ERCB) has completed an exhaustive investigation into a Shell Canada Ltd. sour gas pipeline failure near Beaver Mines that occurred on November 19, 2007. Beaver Mines is about 20 km west of Pincher Creek.

The ERCB has determined that pipeline stress in areas where internal corrosion existed caused the pipeline failure. The ERCB will continue to enforce the suspension of 23 pipelines in the area until the company satisfactorily completes all ERCB-directed actions.

At approximately 9:00 a.m. on November 19, 2007, a sour-gas leak was detected in a six-inch sour-gas pipeline near Beaver Mines. The pipeline was shut in immediately by the company and several residents and workers in the area were evacuated as a precautionary measure. At the time, the company also voluntarily shut down similar pipelines in the area.

The ERCB investigation included a physical inspection of the pipeline, a pipeline history audit, a review of the company’s response, and an examination of the results of a third-party analysis of the failure. The cause of the incident is understood, and measures have been implemented to prevent problems of this nature from occurring in the future.

Although the company’s response to the incident was sufficient to protect public safety, the ERCB has found areas of improvement in the company’s Emergency Response Plan and has directed the company to develop plans to address the following:

• reduce the response time for mobile air monitoring units
• ensure resources dispatched to an incident communicate effectively with the Incident Command Post
• track individuals who arrive at roadblocks and are turned away.
• ensure that consistent and reliable data is received on handheld H2S monitoring units.

Pipeline failures in Alberta are rare. In 2007, Alberta’s pipeline failure rate was a record low 2.1 failures per 1,000 kilometres of pipeline. This is down 30% since 2000 (when there were 3.3 failures per 1,000 km). There are 403,544 kilometres of pipeline in Alberta.

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For more information, please contact:

Bob Curran
ERCB Communications
Phone: 403-297-3392

NR 2008-27