Salt Springs New Brunswick
Underground Gas Storage Project

Storage Development & Service Briefing Material (April 2008)

• Rationale for Salt Springs Storage
• Project Description
• Strategic Location
• Storage Project Location & Pipelines
• Corridor Storage Exploration Licenses
• Stratigraphy
• Salt Springs Salt Formations
• Cross Section N - S
• Salt Spings Salt Deposit
  • Salt Springs deposit allows development of Gulf Coast-type storage caverns
• Schematic of Brining Operation
• Existing PCS Cassidy Lake Brine Disposal System
• Indicative Salt Springs Storage Costs
  • Firm Service (20 to 30 day service)
  • Operational Considerations
• Significant Intrinsic (Seasonal) Value Can Be Captured

Rationale for Salt Springs Storage

• Supply Security - Winter supply reliability to offset offshore gas production shut downs and curtailments & price spike protection
• Flexibility - Allows supply purchase management
• Arbitrage - Supports arbitrage opportunities and/or price stability
• Peaking - Would provide peaking service to Canadian M&NP Shippers

Project Description

• Corridor Resources - Holds Storage Development License for the Salt Springs, New Brunswick Location
• Solution mine at least one cavern:
  Initial Cavern Size - 4.0 bcf of working gas (2011/12)
• Expandable with multiple caverns to 15 to 18 bcf or more over 10 years
• 150,000 dth/day of initial withdrawal capacity
• 20011/12 In-Service
• Propose to connect to M&NP Saint John lateral in East Saint John and with the M&NP mainline via Corridor's existing production sales line⁽¹⁾
• Direct access to Corridor gas production

Note: (1) If there is insufficient interest in connecting to the M&NP Saint John lateral, the storage and Corridor sales lines would be upgraded to deliver 150,000 dth per day to the M&NP mainline.

Strategic Location

Storage Project Location & Pipelines

Corridor Storage Exploration Licenses

Corridor holds the Province of New Brunswick Underground Storage Exploration License No. 08-01 issued pursuant to the Underground Storage Act authorizing it to investigate the development of its 15,000 + hectacre license containing the Salt Springs salt deposit

Stratigraphy

• Salt in this area is 95 - 98 % pure (core samples taken during 1980s potash exploration)
• The salt is subdivided into basal, middle and upper halite units:
  • Basal Halite: 2 to 5 % disseminated clays;
  • Middle Halite: 3 to 5 % disseminated clays;
  • Upper Halite is thin and discontinuous;
  • Potash occurs between Middle and Upper Halite units
• Disseminated clays increase in abundance up section

Salt Springs Salt Formations

Cross Section N - S

• The salt thickens to the west and southwest as shown on the following cross section.
• The salt occurs between 1500 ft and 3700 ft at its thickest point (2200 ft).
• A few beds of potash are also observed.

Salt Spings Salt Deposit

Salt Springs deposit allows development of
Gulf Coast-type storage caverns

Schematic of Brining Operation

Existing PCS Cassidy Lake Brine Disposal System

Potash Corporation of Saskatchewan (PCS) currently owns and operates a 900 gpm brine disposal system that includes:

• Brine Pond
• Pumps
• 34 km disposal line
• Diffusion Header in Bay of Fundy

Corridor has undertaken an upgrade study to install additional pumping capacity and a parallel disposal line that would increase the capacity by an additional 1,800 gpm for cavern leaching.

Indicative Salt Springs Storage Costs

Firm Service (20 to 30 day service)

Firm Service (20 to 30 day service)
Monthly Demand	$0.25/dth/month of contracted working gas volume*
Injection charge	$0.01/dth injected
Withdrawal Charge	$0.01/dth withdrawn
Fuel Retainage	1.5% of volumes injected/withdrawn
Minimum term	10 years
*Includes delivery to/from M&NP or purchased from Corridor production

Operational Considerations

• Injections and/or withdrawals can be nominated for any day limited only by the gas volume in storage at time of nomination
• Intra-day changes in daily nominations will be accommodated upon two hours notice
• Customers are responsible for transportation on pipelines interconnecting with the storage facilities
• Customers may assign storage contract to others but must so notify the storage operator of such assignment

Significant Intrinsic (Seasonal) Value Can Be Captured