SUNCOR ENERGY INC (Form: F-9, Received: 05/15/2012 14:24:19)

Total Value of Equity ($) ⁽⁸⁾ :

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As filed with the Securities and Exchange Commission on May 15, 2012

Registration No. 333-

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM F-9

REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933

SUNCOR ENERGY INC.
( Exact name of Registrant as specified in its charter )

Canada
(Province or other jurisdiction
of incorporation or organization)

1311, 1321, 2911, 4613, 5171, 5172
(Primary Standard Industrial
Classification Code Number)

98-0343201
(I.R.S. Employer
Identification Number, if applicable)

150-6 ^th Avenue S.W., Box 2844, Calgary, Alberta, Canada, T2P 3E3
(403) 296-8000
(Address and Telephone Number of Registrant's Principal Executive Offices)

CT Corporation System
111 8th Avenue, 13 ^th Floor, New York, New York 10011
(212) 590-9070
(Name, Address (Including Zip Code) and Telephone Number (Including Area Code) of Agent for Service of Process in the United States)

Copies to:

Janice B. Odegaard
Suncor Energy Inc.
150 - 6 ^th Avenue S.W., Box 2844
Calgary, Alberta
Canada T2P 3E3
(403) 296-8000

Adam M. Givertz
Paul, Weiss, Rifkind, Wharton & Garrison LLP
Toronto-Dominion Centre
77 King Street West, Suite 3100
Toronto, Ontario
Canada M5K 1J3
(416) 504-0520

Jeffrey J. Bakker
Blake, Cassels & Graydon LLP
855 - 2 ^nd Street S.W.
Suite 3500, Bankers Hall East Tower
Calgary, Alberta
Canada T2P 4J8
(403) 260-9600

Approximate date of commencement of proposed sale of the securities to the public:
From time to time after the effective date of this Registration Statement as determined by market conditions.

Province of Alberta, Canada
(Principal jurisdiction regulating this offering)

It is proposed that this filing shall become effective (check appropriate box below):

A.		o		upon filing with the Commission, pursuant to Rule 467(a) (if in connection with an offering being made contemporaneously in the United States and Canada).
B.		ý		at some future date (check appropriate box below)

1.	o	pursuant to Rule 467(b) on ( ) at ( ) (designate a time not sooner than 7 calendar days after filing).
2.	o	pursuant to Rule 467(b) on ( ) at ( ) (designate a time 7 calendar days or sooner after filing) because the securities regulatory authority in the review jurisdiction has issued a receipt or notification of clearance on ( ).
3.	o	pursuant to Rule 467(b) as soon as practicable after notification of the Commission by the Registrant or the Canadian securities regulatory authority of the review jurisdiction that a receipt or notification of clearance has been issued with respect hereto.
4.	ý	after the filing of the next amendment to this Form (if preliminary material is being filed).

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to the home jurisdiction's shelf prospectus offering procedures, check the following box. ý

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Amount to be Registered ⁽¹⁾⁽²⁾	Proposed Maximum Offering Price per unit ⁽¹⁾⁽²⁾	Proposed Maximum Aggregate Offering Price ⁽¹⁾⁽²⁾	Amount of Registration Fee


Debt Securities	US$2,000,000,000 ⁽³⁾	100%	US$2,000,000,000 ⁽³⁾	US$229,200

(1): The proposed maximum initial offering price per debt security will be determined, from time to time, by the registrant in connection with the sale of the debt securities registered under this Registration Statement.
(2): Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended.
(3): In U.S. dollars or the equivalent thereof in foreign denominated currencies.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registration statement shall become effective as provided in Rule 467 under the Securities Act of 1933 or on such date as the Commission, acting pursuant to Section 8(a) of the Act, may determine.

PART I

INFORMATION REQUIRED TO BE
DELIVERED TO OFFEREES OR PURCHASERS

I-1

Subject to Completion Dated May 15, 2012

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

PRELIMINARY SHORT FORM BASE SHELF PROSPECTUS


		May 15, 2012

SUNCOR ENERGY INC.

U.S.$2,000,000,000
Debt Securities

We may offer for sale, from time to time, debt securities (the " Debt Securities ") up to an aggregate initial offering price of U.S.$2,000,000,000 (or the equivalent in other currencies or currency units) during the 25 month period that this prospectus, including any amendments hereto (the " Prospectus "), remains effective. The aggregate amount shall be calculated, in the case of interest bearing Debt Securities, on the basis of the principal amount of Debt Securities issued, and, in the case of non-interest bearing Debt Securities, on the basis of the gross proceeds received by us.

Neither the U.S. Securities and Exchange Commission (the "SEC") nor any state securities commission has approved or disapproved these Debt Securities or determined if this Prospectus is truthful or complete. Any representation to the contrary is a criminal offence.

We are permitted to prepare this Prospectus in accordance with Canadian disclosure requirements, which are different from those of the United States. We prepare our financial statements, which are incorporated by reference in this Prospectus, in accordance with International Financial Reporting Standards, and they are subject to Canadian auditing and auditor independence standards. They may not be comparable to financial statements of United States companies. We prepare our oil and gas reserves and resources estimates, which are incorporated by reference in this Prospectus, in accordance with Canadian disclosure standards. This disclosure may not be comparable to the oil and gas disclosure of United States companies.

Owning the Debt Securities may subject you to tax consequences both in the United States and Canada. This Prospectus or any applicable Prospectus Supplement (as defined below) may not describe these tax consequences fully. You should read the tax discussion in any applicable Prospectus Supplement.

Your ability to enforce civil liabilities under the United States federal securities laws may be affected adversely because we are incorporated in Canada, most of our officers and directors and all of the experts named in this Prospectus are Canadian residents, and many of our assets are located outside the United States.

Debt Securities may be offered in amounts and on such terms and conditions as may be determined from time to time depending upon our financing requirements, prevailing market conditions and other factors. The specific terms of any offering of Debt Securities including, where applicable, the specific designation of the Debt Securities, the currency, the maturity, the offering price, whether the Debt Securities will bear interest, the interest rate or method for determining the interest rate, any terms of redemption and any other specific terms, will be set forth in one or more Prospectus Supplements (each, a " Prospectus Supplement ") that will be delivered to purchasers together with this Prospectus.

All shelf information permitted under applicable law to be omitted from this Prospectus will be contained in one or more Prospectus Supplements that will be delivered to purchasers together with this Prospectus, such delivery to be effected in the case of United States purchasers through the filing of such Prospectus Supplement on the internet at www.sec.gov. Each Prospectus Supplement will be incorporated by reference into this Prospectus for the purposes of securities legislation as of the date of the Prospectus Supplement and only for the purposes of the distribution of the Debt Securities to which the Prospectus Supplement pertains.

We will provide the specific terms of the Debt Securities and all information omitted from this Prospectus in Prospectus Supplements. You should read this Prospectus and any applicable Prospectus Supplement carefully before you invest.

We may sell Debt Securities to or through underwriters or dealers purchasing as principals, and may also sell Debt Securities to one or more purchasers directly or through agents. See "Plan of Distribution". The Prospectus Supplement relating to a particular offering of Debt Securities will identify each underwriter, dealer or agent, as the case may be, engaged by us in connection with the offering and sale of the Debt Securities, and will set forth terms of the offering of Debt Securities, including the method of distribution of such Debt Securities, the proceeds to us and any fees, discounts or any other compensation payable to underwriters, dealers or agents and any other material terms of the plan of distribution. It will also set forth the proceeds to us.

Unless otherwise specified in the applicable Prospectus Supplement, each series or issue of Debt Securities will be a new issue of Debt Securities with no established trading market. The Debt Securities may be sold from time to time in one or more transactions at a fixed price or prices or at non-fixed prices. If offered on a non-fixed price basis, the Debt Securities may be offered at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at prices to be negotiated with purchasers, in which case the compensation payable to any underwriter, dealer or agent in connection with any such sale will be the amount, if any, by which the aggregate price paid for the Debt Securities by the purchasers exceeds the gross proceeds paid by the underwriter, dealer or agent to us and the price at which the Debt Securities will be offered and sold may vary as between purchasers during the distribution period.

Unless otherwise specified in the applicable Prospectus Supplement, the Debt Securities will not be listed on any securities or stock exchange. There is no market through which the Debt Securities may be sold and purchasers may not be able to resell securities purchased under this Prospectus. This may affect the pricing of the Debt Securities in the secondary market, the transparency and availability of trading prices, the liquidity of the Debt Securities, and the extent of issuer regulations. See "Risk Factors".

Our registered and principal office is located at 150 - 6 ^th Avenue S.W., P.O. Box 2844, Calgary, Alberta, Canada T2P 3E3.

TABLE OF CONTENTS



ABOUT THIS PROSPECTUS		1
DOCUMENTS INCORPORATED BY REFERENCE		2
FORWARD-LOOKING INFORMATION		3
WHERE YOU CAN FIND MORE INFORMATION		4
ENFORCEABILITY OF CIVIL LIABILITIES		5
RISK FACTORS		5
SUNCOR ENERGY INC.		7
CONSOLIDATED CAPITALIZATION		7
USE OF PROCEEDS		7
EARNINGS COVERAGE RATIOS		7
TRADING PRICE AND VOLUME		8
DESCRIPTION OF DEBT SECURITIES		8
PLAN OF DISTRIBUTION		22
CERTAIN INCOME TAX CONSIDERATIONS		23
LEGAL MATTERS		23
INTEREST OF EXPERTS		23
DOCUMENTS FILED AS PART OF THE REGISTRATION STATEMENT		24

ABOUT THIS PROSPECTUS

In this Prospectus and in any Prospectus Supplement, unless otherwise specified or the context otherwise requires, all dollar amounts are expressed in Canadian dollars, references to "dollars" or "$" are to Canadian dollars and references to "U.S.$" are to United States dollars.

Unless otherwise specified or the context otherwise requires, all references in this Prospectus to "Suncor", "we", "us" and "our" means Suncor Energy Inc. and its consolidated subsidiaries (which include corporate and partnership subsidiaries) and joint venture investments. In the section entitled "Description of Debt Securities" in this Prospectus, "Suncor", "we", "us" and "our" means Suncor Energy Inc., without any of its subsidiaries or joint venture investments through which it operates.

This Prospectus is part of a registration statement on Form F-9 relating to the Debt Securities that we filed with the SEC. Under the registration statement, we may, from time to time, sell any combination of the Debt Securities described in this Prospectus in one or more offerings up to an aggregate initial offering price of U.S.$2,000,000,000. This Prospectus provides you with a general description of the Debt Securities that we may offer. Each time we sell Debt Securities under the registration statement, we will provide a Prospectus Supplement that will contain specific information about the terms of that offering of Debt Securities. The Prospectus Supplement may also add, update or change information contained in this Prospectus. Before you invest, you should read both this Prospectus and any applicable Prospectus Supplement together with the additional information described under the heading "Where You Can Find More Information". This Prospectus does not contain all of the information set forth in the registration statement, certain parts of which are omitted in accordance with the rules and regulations of the SEC. You may refer to the registration statement and the exhibits to the registration statement for further information with respect to us and the Debt Securities.

Effective January 1, 2011, we adopted International Financial Reporting Standards (" IFRS ") as promulgated by the International Accounting Standards Board (" IASB "), which differ from United States generally accepted accounting principles (" U.S. GAAP "). Our audited comparative consolidated financial statements for the year ended December 31, 2011 and our unaudited comparative consolidated financial statements for the three months ended March 31, 2012, which are incorporated by reference in this Prospectus, are prepared in accordance with IFRS. Therefore, our consolidated financial statements incorporated by reference in this Prospectus may not be comparable to financial statements prepared in accordance with U.S. GAAP. The rules of the SEC generally do not require foreign private issuers, such as Suncor, that prepare their financial statements in accordance with IFRS as promulgated by the IASB to reconcile such financial statements to U.S. GAAP. Such a reconciliation would describe the principal differences between U.S. GAAP and IFRS, and we have not and will not be providing this information. Unless otherwise indicated, all financial information included and incorporated by reference in this Prospectus is determined using IFRS.

The oil and gas reserves and resources estimates incorporated by reference in this Prospectus have been prepared in accordance with National Instrument 51-101 — Standards of Disclosure for Oil and Gas Activities (" NI 51-101 "), which has been adopted by securities regulatory authorities in Canada and imposes oil and gas disclosure standards for Canadian public issuers engaged in oil and gas activities and differ from the oil and gas disclosure standards of the SEC under Subpart 1200 of Regulation S-K. NI 51-101 permits oil and gas issuers, in their filings with Canadian securities regulatory authorities, to disclose not only proved and probable reserves but also resources, and to disclose reserves and production on a gross basis before deducting royalties. The SEC definitions of proved and probable reserves are different than the definitions contained in NI 51-101. Therefore, proved and probable reserves disclosed in the documents incorporated by reference into this Prospectus in compliance with NI 51-101 may not be comparable to those disclosed by U.S. companies. In addition, certain documents incorporated by reference in this Prospectus contain estimates of "contingent resources". The SEC generally does not permit U.S. companies to disclose oil and gas resources, including contingent resources, in reports filed with the SEC. "Contingent resources" are not, and should not be confused with, reserves. Moreover, as permitted by NI 51-101, we have determined and disclosed our reserves and the related net present value of future net revenue from our reserves in our NI 51-101 compliant reserves disclosure using forecast prices and costs. In contrast, the SEC requires that reserves and related future net revenue be estimated based on historical 12-month average prices rather than forecast prices, but permits the optional disclosure of revenue estimates based on different price and cost criteria, including standardized future prices or

management's own forecasts. Consequently, the oil and gas reserves and resources estimates incorporated by reference in this Prospectus are not comparable to oil and gas reserve estimates provided by U.S. companies in their filings with the SEC. For additional information regarding the presentation of our reserves, resources and other oil and gas information, see the section entitled "Statement of Reserves Data and Other Oil and Gas Information" in the Annual Information Form.

Words importing the singular number include the plural, and vice versa, and words importing any gender include all genders.

DOCUMENTS INCORPORATED BY REFERENCE

Information has been incorporated by reference in this Prospectus from documents filed with the Alberta Securities Commission and with the SEC in the United States. Copies of the documents incorporated by reference may be obtained on request without charge from the Corporate Secretary of Suncor at P.O. Box 2844, 150 - 6 ^th Avenue S.W., Calgary, Alberta, Canada T2P 3E3, Telephone (403) 269-8709. These documents are also available through the internet on the System for Electronic Document Analysis and Retrieval (SEDAR), which can be accessed at www.sedar.com .

The following documents of the Corporation filed with the Alberta Securities Commission and filed with or furnished to the SEC are incorporated by reference into this Prospectus:

•: our audited comparative consolidated financial statements as at and for the year ended December 31, 2011, including the auditor's report thereon;
•: our annual information form for the year ended December 31, 2011 dated March 1, 2012 (the " Annual Information Form ");
•: our management's discussion and analysis of financial condition and results of operations as at and for the year ended December 31, 2011 (the " 2011 MD&A ");
•: our unaudited comparative interim consolidated financial statements as at and for the three month period ended March 31, 2012;
•: our management's discussion and analysis of financial condition and results of operations as at and for the three month period ended March 31, 2012; and
•: our management information circular and proxy statement dated March 1, 2012 relating to the annual meeting of our shareholders held on May 1, 2012.

Any annual information form, audited annual consolidated financial statements (together with the auditors' report thereon), information circular, unaudited interim consolidated financial statements, management's discussion and analysis, material change reports (excluding confidential material change reports) or business acquisition reports subsequently filed by us with securities commissions or similar authorities in the relevant provinces and territories of Canada after the date of this Prospectus and prior to the termination of the offering of Debt Securities under any Prospectus Supplement shall be deemed to be incorporated by reference into this Prospectus. These documents are available through the internet on SEDAR. Any similar documents filed by us with the SEC in our annual reports on Form 40-F, or otherwise filed with or furnished to the SEC pursuant to Section 13(a), 13(c) or 15(d) of the United States Securities Exchange Act of 1934, as amended (the " Exchange Act ") and to the extent expressly provided in such document, in each case after the date of this Prospectus, shall be deemed to be incorporated by reference into this Prospectus and the registration statement of which this Prospectus forms a part. In addition, to the extent that any document or information incorporated by reference into this Prospectus is included in a report that is filed with or furnished to the SEC as set out above, such document shall also be deemed to be incorporated by reference as an exhibit to the registration statement of which this Prospectus forms a part.

Any statement contained in this Prospectus or in a document (or part thereof) incorporated by reference, or deemed to be incorporated by reference, in this Prospectus shall be deemed to be modified or superseded, for purposes of this Prospectus, to the extent that a statement contained in this Prospectus or in any subsequently filed document (or part thereof) that also is, or is deemed to be, incorporated by reference in this Prospectus

modifies or supersedes such statement. The modifying or superseding statement need not state that it has modified or superseded a prior statement or include any other information set forth in the document which it modifies or supersedes. The making of a modifying or superseding statement is not to be deemed an admission for any purposes that the modified or superseded statement, when made, constituted a misrepresentation, an untrue statement of a material fact or an omission to state a material fact that is required to be stated or that is necessary to make a statement not misleading in light of the circumstances in which it was made. Any statement so modified or superseded shall not constitute a part of this Prospectus, except as so modified or superseded.

A Prospectus Supplement containing the specific terms for an offering of Debt Securities will be delivered to purchasers of such Debt Securities together with this Prospectus and will be incorporated by reference into this Prospectus as of the date of such Prospectus Supplement, solely for the purposes of the offering of the Debt Securities issued under such Prospectus Supplement.

Upon a new annual information form and related annual consolidated financial statements and the accompanying management's discussion and analysis being filed by us with the applicable securities regulatory authorities during the duration of this Prospectus, the previous annual information form, the previous annual consolidated financial statements and all interim consolidated financial statements and the accompanying management's discussion and analysis, any material change reports and any information circulars (other than an information circular in connection with an annual meeting of shareholders) filed prior to the commencement of our financial year in which the new annual information form is filed shall be deemed no longer to be incorporated by reference in this Prospectus for purposes of future offers and sales of Debt Securities under this Prospectus. Upon interim consolidated financial statements and the accompanying management's discussion and analysis being filed by us with the applicable securities regulatory authorities during the duration of this Prospectus, all interim consolidated financial statements and the accompanying management's discussion and analysis filed prior to the new interim consolidated financial statements shall be deemed no longer to be incorporated by reference in this Prospectus for purposes of future offers and sales of Debt Securities under this Prospectus. Upon a new information circular in connection with an annual meeting of shareholders being filed by us with the applicable securities regulatory authorities during the duration of this Prospectus, the previous information circular filed in connection with an annual meeting of shareholders shall be deemed no longer to be incorporated by reference in this Prospectus for purposes of future offers and sales of Debt Securities under this Prospectus.

We have not authorized anyone to provide you with any information different than the information contained in or incorporated by reference in this Prospectus or any applicable Prospectus Supplement or any other information included in the registration statement of which this Prospectus forms a part. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not making an offer of these Debt Securities in any jurisdiction where the offer is not permitted by law. You should not assume that the information contained in or incorporated by reference in this Prospectus or any applicable Prospectus Supplement is accurate as of any date other than the date on the front of the applicable Prospectus Supplement.

FORWARD-LOOKING INFORMATION

This Prospectus (and any Prospectus Supplement) and the documents incorporated by reference herein include "forward-looking information" and "forward-looking statements" (collectively, " forward-looking information ") within the meaning of securities laws, including the "safe harbor" provisions of the Securities Act (Alberta), the United States Private Securities Litigation Reform Act of 1995, Section 21E of the Exchange Act, and Section 27A of the United States. Securities Act of 1933 , as amended (the " Securities Act "). All statements that address expectations or projections about the future, including statements about our strategy for growth, expected and future expenditures or investment decisions, commodity prices, costs, schedules, production volumes, operating and financial results, future financing and capital activities, and the expected impact of future commitments, is forward-looking information. Some of the forward-looking information may be identified by words like "expects", "anticipates", "estimates", "plans", "intends", "believes", "projects", "indicates", "could", "vision", "goal", "target", "objective" and similar expressions. Our business is subject to risks and uncertainties, some of which are similar to other oil and gas companies and some of which are unique to us. Our actual results may differ materially from those expressed or implied by our forward-looking

statements as a result of known and unknown risks, uncertainties and other factors. All forward-looking information is based on Suncor's beliefs and assumptions based on information available at the time the statements were made. In particular, and without limitation, this Prospectus contains forward-looking information under the headings "Use of Proceeds" and "Plan of Distribution", and specific forward-looking information in the documents incorporated by reference herein are identified in the applicable document.

Prospective purchasers are cautioned not to place undue reliance on our forward-looking information. By its nature, forward-looking information is subject to various risks and uncertainties, including those discussed and incorporated by reference in this Prospectus and as described in the Annual Information Form and in the 2011 MD&A under the headings "Risk Factors" and "Advisory — Forward-Looking Information" and comparable sections in our interim management's discussion and analysis, which could cause Suncor's actual results and experience to differ materially from the anticipated results or expectations expressed. Forward-looking information also requires numerous assumptions to be made. The material factors and assumptions made in respect of this forward-looking information are disclosed in the Annual Information Form and in the 2011 MD&A under the heading "Advisory — Forward-Looking Information" and comparable sections in our interim management's discussion and analysis, as may be modified or superseded by documents incorporated or deemed to be incorporated by reference herein. Suncor's assumptions about future events may not prove to be accurate. In light of these risks, uncertainties and assumptions, prospective purchasers should be aware that the events described in the forward-looking information set out in this Prospectus (and any Prospectus Supplement) and the documents incorporated by reference herein may not occur. These lists of important factors are not exhaustive.

Statements relating to "reserves" and "resources" are deemed to be forward-looking information, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and resources described can be profitably produced in the future.

The forward-looking information contained in this Prospectus, any Prospectus Supplement or any document incorporated by reference herein or therein is made as of the date of such document and, except as required under applicable laws, we undertake no obligation to update publicly or otherwise revise any forward-looking information, whether as a result of new information, future events or otherwise, or the foregoing list of factors affecting this information.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form F-9 relating to the Debt Securities. This Prospectus, which constitutes a part of the registration statement, does not contain all of the information contained in the registration statement, certain items of which are contained in the exhibits to the registration statement as permitted by the rules and regulations of the SEC. Statements included or incorporated by reference in this Prospectus about the contents of any contract, agreement or other documents referred to are not necessarily complete, and in each instance, you should refer to the exhibits for a more complete description of the matter involved. Each such statement is qualified in its entirety by such reference.

We file with the securities commissions or similar authorities in each of the provinces of Canada, material change, annual and quarterly reports and other information. We are subject to the informational requirements of the Exchange Act and, in accordance with the Exchange Act, we also file certain reports with and furnish other information to the SEC. Under the multijurisdictional disclosure system adopted by the United States and Canada, these reports and other information may be prepared in accordance with the disclosure requirements of Canada, which differ from those in the United States. You may read and copy any document we furnish to the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. You may read and download reports and other information we have filed electronically with the SEC by accessing the SEC's website at www.sec.gov. You may read and download any public document that we have filed with the securities commission or similar authorities in each of the provinces of Canada at www.sedar.com .

ENFORCEABILITY OF CIVIL LIABILITIES

We are a corporation existing under the Canada Business Corporations Act . Most of our officers and directors, and most of the experts named in this Prospectus, are Canadian residents, and many of our assets are located outside the United States. We have appointed an agent for service of process in the United States, but it may be difficult for holders of Debt Securities who reside in the United States to effect service within the United States upon those officers, directors and experts who are not residents of the United States. It may also be difficult for holders of Debt Securities who reside in the United States to realize in the United States upon judgments of courts of the United States predicated upon our civil liability and the civil liability of our officers, directors and experts under the United States federal securities laws.

We have been advised by our Canadian counsel, Blake, Cassels & Graydon LLP, that a judgment of a United States court predicated solely upon civil liability under United Stated federal securities laws would probably be enforceable in Canada if the United States court in which the judgment was obtained has a basis for jurisdiction in the matter that would be recognized by a Canadian court for the same purposes. We have also been advised by Blake, Cassels & Graydon LLP, however, that there is substantial doubt as to whether an action could be brought in Canada in the first instance on the basis of liability predicated solely upon United States federal securities laws.

We filed with the SEC, concurrently with our registration statement on Form F-9, an appointment of agent for service of process on Form F-X. Under the Form F-X, we appointed CT Corporation System as our agent for service of process in the United States in connection with any investigation or administrative proceeding conducted by the SEC, and any civil suit or action brought against or involving us in a United States court arising out of or related to or concerning the offering of the Debt Securities under this Prospectus.

RISK FACTORS

You should consider carefully the risk factors set forth below as well as the other information contained in and incorporated by reference in this Prospectus and in the applicable Prospectus Supplement before purchasing the Debt Securities. Additional risk factors are discussed in our Annual Information Form and in our 2011 MD&A, which are incorporated by reference in this Prospectus. If any event arising from these risks occurs, our business, prospects, financial condition, results of operations or cash flows, and the value or trading price of any Debt Securities, could be materially adversely affected.

The Debt Securities will be effectively subordinated to certain indebtedness or other liabilities of our subsidiaries which do not guarantee the Debt Securities.

Unless otherwise provided in the applicable Prospectus Supplement with respect to a specific issue of Debt Securities, the Debt Securities will be our unsubordinated and unsecured obligation and will rank equally with all of our other unsecured, unsubordinated obligations. We carry on our business through subsidiaries. The majority of our assets are held in one or more subsidiaries. Our results of operations and ability to service indebtedness, including the Debt Securities, are dependent upon the results of operations of these subsidiaries and the payment of funds by these subsidiaries to us in the form of loans, dividends or otherwise. However, unless otherwise provided in the applicable Prospectus Supplement with respect to a specific issue of Debt Securities, the Debt Securities will not be guaranteed by any of our subsidiaries. Consequently, the Debt Securities will be effectively subordinated to the liabilities, including trade payables, of our subsidiaries. In the event of the liquidation of any subsidiary, the assets of the subsidiary would be used first to repay the indebtedness of the subsidiary, including trade payables or obligations under any guarantees, prior to being used by us to pay our indebtedness, including any Debt Securities. The Indenture pursuant to which the Debt Securities will be issued does not limit our ability or the ability of our subsidiaries to incur additional unsecured indebtedness or other liabilities.

The Debt Securities will be unsecured and effectively subordinated to any of our secured indebtedness.

Unless otherwise provided in the applicable Prospectus Supplement with respect to a specific issue of Debt Securities, the Debt Securities will be unsecured debt of Suncor, excluding its subsidiaries, and will be effectively subordinated to all existing and future secured debt of the Corporation, to the extent of the assets securing such

debt. If the Corporation is involved in any bankruptcy, dissolution, liquidation or reorganization, the secured debt holders would be paid before the holders of Debt Securities receive any amounts due under the Debt Securities to the extent of the value of the assets securing the secured debt. In that event, a holder of Debt Securities may not be able to recover any principal or interest due to it under the Debt Securities.

The Indenture pursuant to which the Debt Securities will be issued provides only limited protection against significant corporate events and other actions we may take that could adversely impact your investment in the Debt Securities.

While the Indenture pursuant to which the Debt Securities will be issued contains terms intended to provide protection to the holders of the Debt Securities upon the occurrence of certain events involving significant corporate transactions, such terms will be limited and may not be sufficient to protect a holder's investment in the Debt Securities.

The Indenture pursuant to which the Debt Securities will be issued does not:

•: require us to maintain any financial ratios or specific levels of net worth, revenues, income, cash flow or liquidity;
•: restrict our ability to repurchase or prepay any other of our securities or other indebtedness;
•: restrict our ability to make investments or to repurchase or pay dividends or make other payments in respect of our common shares or other securities ranking junior to the Debt Securities;
•: restrict our ability to enter into highly leveraged transactions; or
•: require us to repurchase the Debt Securities in the event of a change in control.

As a result of the foregoing, when evaluating an investment in the Debt Securities, you should be aware that the terms of the Indenture pursuant to which the Debt Securities will be issued does not restrict our ability to engage in, or to otherwise be a party to, a variety of corporate transactions, circumstances and events that could have an adverse impact on your investment in the Debt Securities.

Failure to maintain our credit ratings may have an adverse impact on the market value of the Debt Securities.

A change or anticipated change in any credit rating on the Debt Securities or our other debt could have an adverse impact on our liquidity, our costs of funds and any of our agreements that refer to credit ratings. Any such change or anticipated change in our credit ratings would also generally have an adverse effect on the market value of the Debt Securities. There is no assurance that any credit rating assigned to Debt Securities will remain in effect for any given period of time or that any rating will not be lowered or withdrawn entirely by the relevant rating agency.

Changes in interest rates may cause the value of the Debt Securities to decline.

Prevailing interest rates will affect the market price or value of the Debt Securities. The market price or value of the Debt Securities may decline as prevailing interest rates for comparable debt instruments rise and increase as prevailing interest rates for comparable debt instruments decline.

There can be no assurance as to the liquidity of the trading market for the Debt Securities or that a trading market for the Debt Securities will develop.

There is no public market for the Debt Securities and, unless otherwise specified in the applicable Prospectus Supplement, we do not intend to apply for listing of the Debt Securities on any securities exchanges. If the Debt Securities are traded after their initial issue, they may trade at a discount from their initial offering prices depending on prevailing interest rates, the market for similar securities and other factors, including general economic conditions and our financial condition. There can be no assurance as to the liquidity of the trading market for the Debt Securities or that a trading market for the Debt Securities will develop.

SUNCOR ENERGY INC.

Suncor is an integrated energy company, with its corporate headquarters in Calgary, Alberta, Canada. We are strategically focused on developing one of the world's largest petroleum resource basins — Canada's Athabasca oil sands. In addition, we explore for, acquire, develop, produce and market crude oil and natural gas in Canada and internationally, and we transport and refine crude oil, and market petroleum and petrochemical products, primarily in Canada. Periodically, we market third party petroleum products. We also carry on energy trading activities focused principally on the marketing and trading of crude oil, natural gas, refined products and byproducts and the use of financial derivatives.

Suncor's registered and principal office is located at 150 - 6 ^th Avenue S.W., P.O. Box 2844, Calgary, Alberta, Canada, T2P 3E3. Our common shares are listed for trading on the Toronto Stock Exchange and the New York Stock Exchange under the trading symbol "SU".

CONSOLIDATED CAPITALIZATION

There have been no material changes in the share and loan capital of the Corporation, on a consolidated basis, since March 31, 2012.

USE OF PROCEEDS

Unless otherwise indicated in an applicable Prospectus Supplement, we will use the net proceeds we receive from the sale of the Debt Securities for general corporate purposes. We may also use the net proceeds for the repayment of indebtedness. The amount of net proceeds to be used for any such purpose will be described in an applicable Prospectus Supplement. We may invest funds that we do not immediately require in short-term marketable securities.

EARNINGS COVERAGE RATIOS

The following sets forth our earnings coverage ratios calculated for the twelve month periods ended December 31, 2011, based on audited consolidated financial information, and March 31, 2012, based on unaudited consolidated financial information. The earnings coverage ratios set out below have been prepared and included in this Prospectus in accordance with Canadian disclosure requirements and have been calculated based on financial information prepared in accordance with IFRS. The earnings coverage ratios set out below do not purport to be indicative of an earnings coverage ratio for any future periods. Adjustments for normal course issuances and repayments of financial obligations subsequent to December 31, 2011 would not materially affect the ratios. The earnings coverage ratios do not give effect to the Debt Securities offered by this Prospectus since the aggregate principal amount of Debt Securities that will be issued hereunder and the terms of issue are not presently known.

		December 31, 2011		March 31, 2012

Earnings coverage ratio		11.7 times		12.0 times

The earnings coverage ratios are equal to net earnings before borrowing costs and income taxes divided by borrowing costs obligations on all financial liabilities.

Further information with respect to our net earnings may be found in our consolidated statements of comprehensive income incorporated by reference herein.

Suncor's borrowing cost requirements amounted to $661 million for the 12 months ended December 31, 2011. Suncor's net earnings before borrowing costs and income taxes was $7,730 million for the 12 months then ended, which is 11.7 times Suncor's borrowing cost requirements for this period. Suncor's borrowing cost requirements amounted to $662 million for the 12 months ended March 31, 2012. Suncor's net earnings before borrowing costs and income taxes was $7,957 million for the 12 months then ended, which is 12.0 times Suncor's borrowing cost requirements for this period.

If we offer Debt Securities having a term to maturity in excess of one year under this Prospectus and a Prospectus Supplement, the Prospectus Supplement will include earnings coverage ratios giving effect to the issuance of such securities.

TRADING PRICE AND VOLUME

Our common shares are listed on the Toronto Stock Exchange and the New York Stock Exchange under the symbol "SU". The following table sets forth the reported monthly high and low trading price and monthly trading volumes of the common shares on the Toronto Stock Exchange for the periods indicated:

	Price Range ($)

	Price Range ($)				Trading Volume (000s)
2011	High		Low		Trading Volume (000s)
May		44.56		37.94		97,739
June		40.70		36.31		88,738
July		39.60		36.35		64,996
August		36.81		28.71		152,854
September		31.56		25.61		130,795
October		33.10		23.97		124,137
November		33.75		28.07		110,485
December		31.87		27.30		98,747
2012
January		34.87		30.07		91,700
February		37.28		33.41		92,338
March		35.94		31.73		98,223
April		33.23		29.40		79,618
May 1 — 14		33.39		27.93		45,768

DESCRIPTION OF DEBT SECURITIES

In this section only, "we", "us", "our" or "Suncor" refers only to Suncor Energy Inc. and not any of its consolidated subsidiaries, partnerships or joint venture investments. The following description sets forth certain general terms and provisions of the Debt Securities. We will provide the particular terms and provisions of a series of Debt Securities and a description of how the general terms and provisions described below may apply to that series in a Prospectus Supplement.

The Debt Securities will be issued under an indenture, dated as of June 25, 2007 and as thereafter amended or supplemented (the " Indenture "), between Suncor and The Bank of New York (now known as The Bank of New York Mellon), as trustee (the " Trustee "). The Indenture is subject to and governed by the United States Trust Indenture Act of 1939, as amended. A copy of the Indenture has been incorporated by reference as an exhibit to the registration statement filed with the SEC. The following is a summary of the Indenture, which sets forth certain general terms and provisions of the Debt Securities and is not intended to be complete. For a more complete description, including the definition of capitalized terms used but not defined under this section, prospective investors should refer to the Indenture. Whenever we refer to particular provisions of the Indenture, those provisions are qualified in their entirety by reference to the Indenture. References in parentheses are to section numbers or articles of the Indenture.

We may issue securities (including debt securities) and incur additional indebtedness other than through the offering of Debt Securities under this Prospectus.

General

The Indenture does not limit the aggregate principal amount of Debt Securities that we may issue under the Indenture and does not limit the amount of other indebtedness we may incur. The Indenture provides that Debt Securities may be issued from time to time in one or more series and may be denominated and payable in U.S. dollars or any foreign currency. Special Canadian and U.S. federal income tax considerations applicable to

any of the Debt Securities denominated in a foreign currency will be described in the Prospectus Supplement relating to any offering of Debt Securities denominated in a foreign currency. Unless otherwise indicated in a Prospectus Supplement, the Debt Securities will be unsecured obligations. The Debt Securities offered pursuant to this Prospectus will be issued in an amount up to U.S.$2.0 billion or the equivalent number denominated in foreign currency. The Indenture also permits us to increase the principal amount of any series of the Debt Securities previously issued and to issue that increased principal amount.

The applicable Prospectus Supplement will describe the specific terms of the Debt Securities of any series being offered and may include, but is not limited to, any of the following:

•: the title and the aggregate principal amount of the Debt Securities;
•: the date or dates, or the method by which such date or dates will be determined or extended, on which the principal of (and premium, if any, on) the Debt Securities will be payable and the portion (if less than the principal amount) to be payable upon a declaration of acceleration of maturity;
•: the rate or rates (whether fixed or variable) at which the Debt Securities will bear interest, if any, or the method by which such rate or rates will be determined and the date or dates from which such interest will accrue;
•: the date or dates, or the method by which such date or dates will be determined or extended, on which any interest will be payable and the regular record dates for the payment of interest on the Debt Securities in registered form;
•: the place or places where the principal of (and premium, if any) and interest, if any, on the Debt Securities will be payable and each office or agency where the Debt Securities may be presented for registration of transfer or exchange;
•: each office or agency where the principal of (and premium, if any) and interest, if any, on the Debt Securities of such series will be payable;
•: the period or periods within which, the price or prices at which, the currency or currency unit in which, and other terms and conditions upon which the Debt Securities may be redeemed or purchased, in whole or in part, by us;
•: the terms and conditions upon which you may redeem the Debt Securities prior to maturity and the price or prices at which and the currency or currency unit in which the Debt Securities are payable;
•: any mandatory or optional redemption or sinking fund or analogous provisions;
•: if other than denominations of U.S.$1,000 and any integral multiple thereof, the denomination or denominations in which any registered securities of the series shall be issuable and, if other than the denomination of U.S.$5,000, the denomination or denominations in which any bearer securities of the series shall be issuable;
•: if other than U.S. dollars, the currency or currency unit in which the Debt Securities are denominated or in which currency payment of the principal of (and premium, if any) or interest, if any, on such Debt Securities will be payable;
•: any index formula or other method used to determine the amount of payments of principal of (and premium, if any) or interest, if any, on the Debt Securities;
•: whether the series of the Debt Securities are to be registered securities, bearer securities (with or without coupons) or both;
•: whether the Debt Securities will be issuable in the form of one or more global securities and, if so, the identity of the depository for the global securities;
•: whether and under what circumstances we will be required to pay any Additional Amounts (defined below under " Additional Amounts ") for withholding or deduction for Canadian taxes with respect to the securities, and whether we will have the option to redeem the Debt Securities rather than pay the Additional Amounts;

•: the terms, if any, on which the Debt Securities may be converted or exchanged for other of our securities or securities of other entities;
•: if payment of the Debt Securities will be guaranteed by any other person;
•: the extent and manner, if any, in which payment on or in respect of the Debt Securities will be senior or will be subordinated to the prior payment of our other liabilities and obligations;
•: the percentage or percentages of principal amount at which the Debt Securities will be issued;
•: any applicable Canadian and U.S. federal income tax consequences; and
•: any other terms, conditions, rights and preferences (or limitations on such rights and preferences) of the Debt Securities including covenants and events of default which apply solely to a particular series of the Debt Securities being offered which do not apply generally to other Debt Securities, or any covenants or events of default generally applicable to the Debt Securities which do not apply to a particular series of the Debt Securities.

Unless otherwise indicated in a Prospectus Supplement, the Indenture does not afford holders of the Debt Securities the right to tender such Debt Securities to us for repurchase or provide for any increase in the rate or rates of interest at which the Debt Securities will bear interest, in the event we should become involved in a highly leveraged transaction or in the event we have a change in control.

The Debt Securities may be issued under the Indenture bearing no interest or at a discount below their stated principal amount. The Canadian and U.S. federal income tax consequences and other special considerations applicable to any such discounted Debt Securities or other Debt Securities offered and sold at par which are treated as having been issued at a discount for Canadian and/or U.S. federal income tax purposes will be described in a Prospectus Supplement.

Ranking and Other Indebtedness

Unless otherwise indicated in an applicable Prospectus Supplement, the Debt Securities will be unsecured obligations and will rank equally with all of our other unsecured and unsubordinated debt from time to time outstanding and equally with other securities issued under the Indenture. The Debt Securities will be structurally subordinated to all existing and future liabilities, including trade payables and other indebtedness, of our subsidiaries.

Form, Denominations and Exchange

A series of the Debt Securities may be issued solely as registered securities, solely as bearer securities or as both registered securities and bearer securities. Registered securities will be issuable in denominations of U.S.$1,000 and any integral multiple thereof and bearer securities will be issuable in denominations of U.S.$5,000 or, in each case, in such other denominations as may be set out in the terms of the Debt Securities of any particular series. The Indenture will provide that a series of the Debt Securities may be issuable in global form. Unless otherwise indicated in a Prospectus Supplement, bearer securities will have interest coupons attached.

Registered securities of any series will be exchangeable for other registered securities of the same series and of a like aggregate principal amount and tenor of different authorized denominations. If, but only if, provided in a Prospectus Supplement, bearer securities (with all unmatured coupons, except as provided below, and all matured coupons in default) of any series may be exchanged for registered securities of the same series of any authorized denominations and of a like aggregate principal amount and tenor. In such event, bearer securities surrendered in a permitted exchange for registered securities between a regular record date or a special record date and the relevant date for payment of interest shall be surrendered without the coupon relating to such date for payment of interest, and interest will not be payable on such date for payment of interest in respect of the registered security issued in exchange for such bearer security, but will be payable only to the holder of such coupon when due in accordance with the terms of the Indenture. Unless otherwise specified in a Prospectus Supplement, bearer securities will not be issued in exchange for registered securities.

The applicable Prospectus Supplement may indicate the places to register a transfer of the Debt Securities. Except for certain restrictions set forth in the Indenture, no service charge will be made for any registration of transfer or exchange of the Debt Securities, but we may, in certain instances, require a sum sufficient to cover any tax or other governmental charges payable in connection with these transactions.

We shall not be required to:

•: issue, register the transfer of or exchange any series of the Debt Securities during a period beginning at the opening of business 15 days before any selection of that series of the Debt Securities to be redeemed and ending at the close of business on (A) if the series of the Debt Securities are issuable only as registered securities, the day of mailing of the relevant notice of redemption and (B) if the series of the Debt Securities are issuable as bearer securities, the day of the first publication of the relevant notice of redemption or, if the series of the Debt Securities are also issuable as registered securities and there is no publication, the mailing of the relevant notice of redemption;
•: register the transfer of or exchange any registered security, or portion thereof, called for redemption, except the unredeemed portion of any registered security being redeemed in part;
•: exchange any bearer security selected for redemption, except that, to the extent provided with respect to such bearer security, such bearer security may be exchanged for a registered security of that series and like tenor, provided that such registered security shall be immediately surrendered for redemption with written instruction for payment consistent with the provisions of the Indenture; or
•: issue, register the transfer of, or exchange any of the Debt Securities which have been surrendered for repayment at the option of the holder, except the portion, if any, thereof not to be so repaid.

Global Securities

A series of the Debt Securities may be issued in whole or in part in global form as a "global security" and will be registered in the name of and be deposited with a depositary, or its nominee, each of which will be identified in the Prospectus Supplement relating to that series. Unless and until exchanged, in whole or in part, for the Debt Securities in definitive registered form, a global security may not be transferred except as a whole by the depositary for such global security to a nominee of the depositary, by a nominee of the depositary to the depositary or another nominee of the depositary or by the depositary or any such nominee to a successor of the depositary or a nominee of the successor.

The specific terms of the depositary arrangement with respect to any portion of a particular series of the Debt Securities to be represented by a global security will be described in a Prospectus Supplement relating to such series. We anticipate that the following provisions will apply to all depositary arrangements.

Upon the issuance of a global security, the depositary therefor or its nominee will credit, on its book entry and registration system, the respective principal amounts of the Debt Securities represented by the global security to the accounts of such persons, designated as "participants", having accounts with such depositary or its nominee. Such accounts shall be designated by the underwriters, dealers or agents participating in the distribution of the Debt Securities or by us if such Debt Securities are offered and sold directly by us. Ownership of beneficial interests in a global security will be limited to participants or persons that may hold beneficial interests through participants. Ownership of beneficial interests in a global security will be shown on, and the transfer of that ownership will be effected only through, records maintained by the depositary therefor or its nominee (with respect to interests of participants) or by participants or persons that hold through participants (with respect to interests of persons other than participants). The laws of some states in the United States may require that certain purchasers of securities take physical delivery of such securities in definitive form.

So long as the depositary for a global security or its nominee is the registered owner of the global security, such depositary or such nominee, as the case may be, will be considered the sole owner or holder of the Debt Securities represented by the global security for all purposes under the Indenture. Except as provided below, owners of beneficial interests in a global security will not be entitled to have a series of the Debt Securities represented by the global security registered in their names, will not receive or be entitled to receive physical delivery of such series of the Debt Securities in definitive form and will not be considered the owners or holders thereof under the Indenture.

If a depositary for a global security representing a particular series of the Debt Securities is at any time unwilling or unable to continue as depositary and a successor depositary is not appointed by us within 90 days, we will issue such series of Debt Securities in definitive form in exchange for a global security representing such series of Debt Securities. In addition, we may at any time and in our sole discretion determine not to have a series of Debt Securities represented by a global security and, in such event, will issue a series of Debt Securities in definitive form in exchange for all of the global securities representing the series of Debt Securities.

Payment

Unless otherwise indicated in a Prospectus Supplement, payment of principal of (and premium, if any) and interest on the Debt Securities will be made at the office or agency of the Trustee, or at our option we can pay principal, interest and any premium by: (1) check mailed or delivered to the address of the person entitled as the address appearing in the security register of the Trustee; or (2) wire transfer to an account in the United States of the person entitled to receive payments if such person is a holder of U.S.$1.0 million or more in aggregate principal amount of the Debt Securities.

Unless otherwise indicated in a Prospectus Supplement, payment of any interest will be made to the persons in whose name the Debt Securities are registered at the close of business on the day or days specified by us.

Any payments of principal (and premium, if any) and interest, if any, on global securities registered in the name of a depositary or its nominee will be made to the depositary or its nominee, as the case may be, as the registered owner of the global security representing such Debt Securities. None of us, the Trustee or any paying agent for the Debt Securities represented by the global securities will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of the global security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.

We expect that the depositary for a global security or its nominee, upon receipt of any payment of principal, premium or interest, will credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of the global security as shown on the records of such depositary or its nominee. We also expect that payments by participants to owners of beneficial interests in a global security held through such participants will be governed by standing instructions and customary practices, as is now the case with securities held for the accounts of customers registered in "street name", and will be the responsibility of such participants.

Certain Definitions

Set forth below is a summary of certain of the defined terms used in the Indenture. Reference is made to the Indenture for the full definition of all such terms.

" Capital Lease Obligation " means the obligation of a person, as lessee, to pay rent or other amounts to the lessor under a lease of real or personal property which is required to be classified and accounted for as a capital lease on a consolidated balance sheet of such person in accordance with generally accepted accounting principles.

" Consolidated Net Tangible Assets " means the total amount of assets of Suncor on a consolidated basis after deducting therefrom:

•: all current liabilities (excluding any current liabilities which are by their terms extendible or renewable at the option of the obligor thereon to a time more than 12 months after the time as of which the amount thereof is being computed);
•: all goodwill, trade names, trademarks, patents, unamortized debt discount and expense and other similar intangibles; and
•: appropriate adjustments on account of minority interests of other persons holding stock of Suncor's Subsidiaries;

in each case, as shown on the most recent annual audited or quarterly unaudited consolidated balance sheet of Suncor and computed in accordance with generally accepted accounting principles.

" Current Assets " means current assets as determined in accordance with generally accepted accounting principles.

" Debt " means as at the date of determination, all items of indebtedness in respect of any amounts borrowed which, in accordance with generally accepted accounting principles, would be recorded as debt in the consolidated financial statements of any person, including:

•: any obligation for borrowed money;
•: any obligation evidenced by bonds, debentures, notes, or other similar instruments;
•: any Purchase Money Obligation;
•: any Capital Lease Obligation;
•: any payment obligation under Financial Instrument Obligations; and
•: any guarantee of Debt of another person.

" Financial Instrument Obligations " means obligations arising under:

•: interest rate swap agreements, forward rate agreements, floor, cap or collar agreements, futures or options, insurance or other similar agreements or arrangements, or any combination thereof, entered into by a person of which the subject matter is interest rates or pursuant to which the price, value or amount payable thereunder is dependent or based upon interest rates in effect from time to time or fluctuations in interest rates occurring from time to time;
•: currency swap agreements, cross-currency agreements, forward agreements, floor, cap or collar agreements, futures or options, insurance or other similar agreements or arrangements, or any combination thereof, entered into by a person of which the subject matter is currency exchange rates or pursuant to which the price, value or amount payable thereunder is dependent or based upon currency exchange rates in effect from time to time or fluctuations in currency exchange rates occurring from time to time; and
•: commodity swap or hedging agreements, floor, cap or collar agreements, commodity futures or options or other similar agreements or arrangements, or any combination thereof, entered into by a person of which the subject matter is one or more commodities or pursuant to which the price, value or amount payable thereunder is dependent or based upon the price of one or more commodities in effect from time to time or fluctuations in the price of one or more commodities occurring from time to time.

" generally accepted accounting principles " means generally accepted accounting principles which Suncor reports its financial statements in and which are in effect from time to time.

" Lien " means any security by way of an assignment, mortgage, charge, pledge, lien, encumbrance, title retention agreement or other security interest whatsoever, but not including any security interest in respect of a lease which is not a Capital Lease Obligation and provided that such term shall not include any encumbrance that may be deemed to arise solely as a result of entering into an agreement, not in violation of the terms of the Indenture, to sell or otherwise transfer assets or property.

" Property " or " property " means all property owned by Suncor or a Restricted Subsidiary except such property which is determined by a resolution of our board of directors delivered to the Trustee not to be property of material importance to the total business conducted by us and our Restricted Subsidiaries.

" Purchase Money Mortgage " means any Lien created, issued, incurred or assumed by Suncor or a Restricted Subsidiary to secure a Purchase Money Obligation; provided that such Lien is limited to the property (including the rights associated therewith) acquired, constructed, installed or improved in connection with such Purchase Money Obligation.

" Purchase Money Obligation " means Debt of Suncor or a Restricted Subsidiary incurred or assumed to finance the purchase price, in whole or in part, of any property or incurred to finance the cost, in whole or in part, of construction or installation of or improvements to any property; provided, however, that such Debt is incurred or assumed within 180 days after the purchase of such property or the completion of such construction,

installation or improvements, as the case may be, provided that the principal amount of such Debt which is secured by the Lien does not exceed 100% of such purchase price or cost, as the case may be, and includes any extension, renewal or refunding of any such Debt provided the principal amount thereof outstanding on the date of such extension, renewal or refunding is not increased, and provided further that any such extension, renewal or refunding does not extend to any property other than the property in connection with which such obligation was created and improvements erected or constructed thereon.

" Restricted Subsidiary " means a Subsidiary of Suncor provided, however, such term shall not include any Subsidiary of Suncor if the amount of Suncor's share of the shareholder's equity in such Subsidiary does not, at the time of determination, exceed 2% of Shareholders' Equity.

" Shareholders' Equity " means the aggregate amount of shareholders' equity (including but not limited to share capital, contributed surplus and retained earnings) of Suncor as shown on the most recent annual audited or quarterly unaudited consolidated balance sheet of Suncor and computed in accordance with generally accepted accounting principles.

" Subsidiary " of any person means, at the date of determination, any corporation or other person of which Voting Shares or other interests carrying more than 50% of the voting rights attached to all outstanding Voting Shares or other interests are owned, directly or indirectly, by or for such person or one or more Subsidiaries thereof.

" Voting Shares " means shares of any class of a corporation having under all circumstances the right to vote for the election of the directors of such corporation, provided that, for the purpose of this definition, shares which only carry the right to vote conditionally on the happening of an event shall not be considered Voting Shares whether or not such event shall have happened.

Covenants

Limitation on Liens

The Indenture provides that so long as any of our Debt Securities are outstanding, we will not, and will not permit any of our Restricted Subsidiaries to, create, incur or assume any Lien on or over any present or future property securing any Debt of ours or a Restricted Subsidiary without also simultaneously or prior thereto securing, or causing such Restricted Subsidiary to secure, equally and ratably with such other Debt all of the Debt Securities then outstanding under the Indenture, except:

•: Liens existing as of the date of the Indenture;
•: any Purchase Money Mortgage;
•: Liens on any property in favor of any federal government or any province, state or territory thereof or any municipality therein or any political subdivision, department, agency or instrumentality of any of them to secure the performance of any covenant or obligation to or in favor of or entered into at the request of such authorities where such security is required pursuant to any contract, statute or regulation or with respect to any franchise, grant, license or permit and any defects in title in structures or other facilities arising solely from the fact that such structures or facilities are constructed or installed on lands held by us under government permits, leases or other grants;
•: Liens on any property or any interest therein to secure all or any part of the costs incurred after the date of the Indenture for surveying, exploration, extraction, drilling, development, construction, alteration, repair or improvement of or on such property;
•: Liens on any oil and/or gas property or products derived from such property to secure obligations incurred or guarantees of obligations incurred in connection with or necessarily incidental to commitments of purchase or sale of, or the transportation, storage or distribution of, such property or the products derived from such property;
•: Liens existing on properties when acquired, provided that such Liens were not incurred in anticipation of such acquisition;

•: Liens existing on property of a person when such person becomes a Restricted Subsidiary, or arising thereafter pursuant to contractual commitments entered into prior to and not in contemplation of such person becoming a Restricted Subsidiary, or is merged into or amalgamated or consolidated with us or a Restricted Subsidiary or such property is otherwise acquired by us or a Restricted Subsidiary or when given in compliance with obligations under trust deeds and similar instruments entered into prior to their becoming Restricted Subsidiaries or being merged into or amalgamated or consolidated with us or such property is otherwise acquired, provided such Liens do not attach to property owned by us or owned by our Restricted Subsidiaries prior to such merger, amalgamation or consolidation;
•: Liens arising under partnership agreements, oil and natural gas leases, overriding royalty agreements, net profits agreements, royalty trust agreements, master limited partnership agreements, farm-out agreements, division orders, unitization and pooling designations, declarations, orders and agreements, development agreements, operating agreements, production sales contracts (including security in respect of take or pay or similar obligations thereunder), area of mutual interest agreements, natural gas balancing or deferred production agreements, injection, repressuring and recycling agreements, salt water or other disposal agreements, seismic or geophysical permits or agreements, which in each of the foregoing cases is customary in the oil and natural gas business, and other similar agreements which are customary in the oil and natural gas business, provided in all instances that such Lien is limited to the assets that are the subject of the relevant agreement;
•: Liens incurred or arising by operation of law;
•: Liens incurred in connection with Debt which by its terms is non-recourse to us or any Restricted Subsidiary;
•: Liens in favor of us or any Restricted Subsidiary;
•: Liens on Current Assets to secure Debt repayable on demand or maturing within 12 months of the date when such Debt is incurred or the date of any renewal or extension thereof provided that such security is given at the time that the Debt is incurred;
•: Liens granted in the ordinary course of business in connection with Financial Instrument Obligations;
•: any extension, renewal, alteration, refinancing, replacement, exchange or refunding (or successive extensions, renewals, alterations, refinancings, replacements, exchanges or refundings) of all or part of any Lien referred to in the foregoing clauses; provided however that (A) such new Lien shall be limited to all or part of the property which is secured by the Lien plus improvements on such property and (B) the Debt secured by the new Lien is not increased from the amount of the Debt then existing at the time of such extension, renewal, alteration, refinancing, replacement, exchange or refunding, plus an amount necessary to pay fees and expenses, including premiums, related to such extensions; and
•: Liens that would otherwise be prohibited by the foregoing clauses, provided that the aggregate Debt outstanding and secured pursuant to this clause does not at the time of granting the Lien exceed an amount equal to 10% of Consolidated Net Tangible Assets.

Notwithstanding the foregoing, transactions such as the sale (including any forward sale) or other transfer of (A) oil, gas, minerals or other resources of a primary nature, whether in place or when produced, for a period of time until, or in an amount such that, the purchaser will realize therefrom a specified amount of money or a specified amount of such oil, gas, minerals, or other resources of a primary nature, or (B) any other interest in property of the character commonly referred to as a "production payment", will not constitute secured Debt and will not result in us being required to secure the Debt Securities.

Consolidation, Amalgamation, Merger and Sale of Assets

We may not consolidate or amalgamate with or merge into or enter into any statutory arrangement with any other corporation, or convey, transfer or lease all or substantially all the properties and assets of us and our subsidiaries on a consolidated basis to any person, unless:

•: the entity formed by or continuing from such consolidation or amalgamation or into which we are merged or with which we enter into such arrangement or the person which acquires or leases all or substantially all of our properties and assets is organized and existing under the laws of the United States, any state thereof or the District of Columbia, the laws of Canada or any province or territory thereof, or, if such consolidation, amalgamation, merger, arrangement or other transaction would not impair the rights of holders of the Debt Securities, in any other country, provided that if such successor entity is organized under the laws of a jurisdiction other than Canada or the United States, the successor entity assumes our obligations under the Debt Securities and the Indenture to pay Additional Amounts, substituting the name of such successor jurisdiction for Canada in each place that Canada appears in "Description of Debt Securities — Additional Amounts", below;
•: the successor entity expressly assumes or assumes by operation of law all of our obligations under the Debt Securities and under the Indenture;
•: immediately before and after giving effect to such transaction, no event of default, and no event which, after notice or lapse of time or both, would become an event of default, shall have happened and be continuing; and
•: certain other conditions are met.

Notwithstanding anything to the contrary, we may consolidate or amalgamate with or merge into or enter into a statutory arrangement with any direct or indirect wholly owned subsidiary and convey, transfer or lease all or substantially all of the properties and assets of us and our subsidiaries on a consolidated basis to any direct or indirect wholly owned subsidiary without complying with the above provisions in a transaction or series of transactions in which we remain the obligor on the Debt Securities (a " Permitted Reorganization ") provided we have provided the Trustee and all of our then current ratings agencies with notice of our intention to enter into a Permitted Reorganization at least 45 days prior to the proposed date of completion of such Permitted Reorganization (the " Permitted Reorganization Date ") and provided further that on or prior to the Permitted Reorganization Date we have delivered to the Trustee an officers' certificate confirming that, as of the Permitted Reorganization Date: (i) all of our Debt which ranked pari passu with the then outstanding Debt Securities immediately prior to the proposed Permitted Reorganization will rank no better than pari passu with such Debt Securities after the Permitted Reorganization; for certainty, there is no requirement for any such other Debt to obtain or maintain similar ranking to such Debt Securities and such other Debt may be structurally subordinated or otherwise subordinated to the Debt Securities; or (ii) at least two of our then current credit rating agencies (or if only one credit rating agency maintains ratings in respect of our debt securities at such time, that one rating agency) have affirmed that the rating assigned by them to the Debt Securities shall not be downgraded as a result of the Permitted Reorganization, or notice thereof.

If, as a result of any such transaction, any of our properties or assets or any properties or assets of any Subsidiary of Suncor becomes subject to a Lien, then, unless such Lien could be created pursuant to the Indenture provisions described under the " Limitation on Liens " covenant above without equally and ratably securing the Debt Securities, we, simultaneously with or prior to such transaction, will cause the Debt Securities to be secured equally and ratably with or prior to the Debt secured by such Lien.

Additional Amounts

Unless otherwise specified in a Prospectus Supplement, all payments made by us under or with respect to the Debt Securities will be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including penalties, interest and other liabilities related thereto) imposed or levied by or on behalf of the Government of Canada or any province or territory thereof or by any authority or agency therein or thereof having power to tax (" Canadian Taxes "), unless we are required to withhold or deduct Canadian Taxes by law or by the interpretation or

administration thereof. If we are so required to withhold or deduct any amount for or on account of Canadian Taxes from any payment made under or with respect to the Debt Securities, we will pay to each holder of such Debt Securities as additional interest such additional amounts (" Additional Amounts ") as may be necessary so that the net amount received by each such holder after such withholding or deduction (and after deducting any Canadian Taxes on such Additional Amounts) will not be less than the amount such holder would have received if such Canadian Taxes had not been withheld or deducted. However, no Additional Amounts will be payable with respect to a payment made to a Debt Securities holder (such holder, an " Excluded Holder ") in respect of the beneficial owner thereof:

•: with which we do not deal at arm's length (within the meaning of the Income Tax Act (Canada)) at the time of making such payment;
•: which is subject to such Canadian Taxes by reason of the holder of the Debt Securities being a resident, domicile or national of, or engaged in business or maintaining a permanent establishment or other physical presence in or otherwise having some connection with Canada or any province or territory thereof otherwise than by the mere holding of Debt Securities or the receipt of payments thereunder; or
•: which is subject to such Canadian Taxes by reason of the holder of the Debt Securities failure to comply with any certification, identification, documentation or other reporting requirements if compliance is required by law, regulation, administrative practice or an applicable treaty as a precondition to exemption from, or a reduction in the rate of deduction or withholding of, such Canadian Taxes.

We will also (i) make such withholding or deduction; and (ii) remit the full amount deducted or withheld to the relevant authority in accordance with applicable law.

We will furnish to the holders of the Debt Securities, within 60 days after the date the payment of any Canadian Taxes is due pursuant to applicable law, certified copies of tax receipts or other documents evidencing such payment by us.

We will indemnify and hold harmless each holder of Debt Securities (other than an Excluded Holder) and upon written request reimburse each such holder for the amount, excluding any payment of Additional Amounts by us, of:

•: any Canadian Taxes levied or imposed and paid by such holder as a result of payments made under or with respect to the Debt Securities;
•: any liability (including penalties, interest and expenses) arising therefrom or with respect thereto; and
•: any Canadian Taxes imposed with respect to any reimbursement under clause (i) or (ii) of this paragraph, but excluding any such Canadian Taxes on such holder's net income.

Wherever in the Indenture there is mentioned, in any context, the payment of principal (and premium, if any), interest or any other amount payable under or with respect to a debt security, such mention shall be deemed to include mention of the payment of Additional Amounts to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof.

Tax Redemption

Unless otherwise specified in a Prospectus Supplement, a series of Debt Securities will be subject to redemption at any time, in whole but not in part, at a redemption price equal to the principal amount thereof together with accrued and unpaid interest to the date fixed for redemption, upon the giving of a notice as described below, if we (or our successor) determine that (i) as a result of (A) any amendment to or change (including any announced prospective change) in the laws (or any regulations thereunder) of Canada (or our successor's jurisdiction of organization) or of any political subdivision or taxing authority thereof or therein, as applicable, or (B) any amendment to or change in an interpretation or application of such laws or regulations by any legislative body, court, governmental agency or regulatory authority (including the enactment of any legislation and the publication of any judicial decision or regulatory determination), which amendment or change is announced or becomes effective on or after the date specified in the applicable Prospectus Supplement (or the date a party organized in a jurisdiction other than Canada or the United States becomes our

successor), we have or will become obligated to pay, on the next succeeding date on which interest is due, additional amounts with respect to any debt security of such series as described under "Description of Debt Securities — Additional Amounts", or (ii) on or after the date specified in the applicable Prospectus Supplement (or the date a party organized in a jurisdiction other than Canada or the United States becomes our successor), any action has been taken by any taxing authority of, or any decision has been rendered by a court of competent jurisdiction in, Canada (or our successor's jurisdiction of organization) or any political subdivision or taxing authority thereof or therein, including any of those actions specified in (i) above, whether or not such action was taken or decision was rendered with respect to us, or any change, amendment, application or interpretation shall be officially proposed, which, in any such case, in the written opinion to us of legal counsel of recognized standing, will result in our becoming obligated to pay, on the next succeeding date on which interest is due, additional amounts with respect to any debt security of such series.

In the event that we elect to redeem a series of the Debt Securities pursuant to the provisions set forth in the preceding paragraph, we shall deliver to the Trustee a certificate, signed by an authorized officer, stating that we are entitled to redeem such series of the Debt Securities pursuant to their terms.

Notice of intention to redeem such series of our Debt Securities will be given not more than 60 nor less than 30 days prior to the date fixed for redemption and will specify the date fixed for redemption.

Provision of Financial Information

We will file with the Trustee, within 15 days after we file them with the SEC, copies of our annual and quarterly reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) which we are required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. Notwithstanding that we may not remain subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act or otherwise report on an annual and quarterly basis on forms provided for such annual and quarterly reporting pursuant to rules and regulations promulgated by the SEC, we will continue to provide the Trustee:

•: within the time periods required for the filing of such forms by the SEC, annual reports on Form 40-F or Form 20-F, as applicable, or any successor form; and
•: within the time periods required for the filing of such forms by the SEC, reports on Form 6-K (or any successor form), containing the information which, regardless of applicable requirements shall, at a minimum, contain such information required to be provided in quarterly reports under the laws of Canada or any province thereof to security holders of a corporation with securities listed on the Toronto Stock Exchange, whether or not we have any of our securities listed on such exchange. Each of such reports, to the extent permitted by the rules and regulations of the SEC, will be prepared in accordance with Canadian disclosure requirements and generally accepted accounting principles provided, however, that we shall not be obligated to file such reports with the SEC if the SEC does not permit such filings.

Events of Default

The following are summaries of events with respect to any series of our Debt Securities which will constitute an event of default with respect to the Debt Securities of that series:

(i): default in the payment of any interest on any debt security of that series or additional amounts on any debt security of that series, when it becomes due and payable, and continuance of such default for a period of 30 days;
(ii): default in the payment of the principal of (or premium, if any, on) any debt security of that series when it becomes due and payable;
(iii): default in the performance, or breach, of any covenant or warranty in the Indenture in respect of the Debt Securities of that series, and continuance of such default or breach for a period of 90 days after written notice has been given to us by the Trustee or by the holders of at least 25% in principal amount of all outstanding Debt Securities of any series affected thereby;

(iv): if an event of default (as defined in any indenture or instrument under which we or any Restricted Subsidiary has at the time of the Indenture or shall thereafter have outstanding any Debt for borrowed money) shall happen and be continuing, or we or any Restricted Subsidiary shall have failed to pay principal amounts with respect to such Debt at maturity (whether or not constituting an event of default) and such event of default or failure to pay shall result in Debt being declared due and payable or otherwise being accelerated, in either event so that an amount in excess of the greater of US$75,000,000 and 3.5% of our Shareholders' Equity shall be or become due and payable upon such declaration or prior to the date on which the same would otherwise have become due and payable (the " Accelerated Indebtedness "), and such acceleration shall not be rescinded or annulled, or such event of default or failure to pay under such indenture or instrument shall not be remedied or cured, whether by payment or otherwise, or waived by the holders of such Accelerated Indebtedness, then (a) if the Accelerated Indebtedness shall be as a result of an event of default which is not related to the failure to pay principal on the conditions set out in any such indenture or instrument, it shall not be considered an event of default for purposes of the Indenture until 30 days after such Debt has been accelerated, or (b) if the Accelerated Indebtedness shall occur as a result of such failure to pay principal or as a result of an event of default which is related to the failure to pay principal on the conditions set out in any such indenture or instrument, then (i) if such Accelerated Indebtedness is, by its terms, non-recourse to the borrower, it shall not be considered an event of default for purposes of the Indenture; or (ii) if such Accelerated Indebtedness is recourse to the borrower, any requirement for the giving of notice or the lapse of time or the happening of any further condition, event or act under such other indenture or instrument in connection with such failure to pay principal or event of default shall be applicable together with an additional seven days before being considered an event of default for purposes of the Indenture;
(v): certain events in bankruptcy, insolvency, assignment for the benefit of creditors or analogous process have occurred with respect to us; or
(vi): any other events of default provided with respect to Debt Securities of that series.

If an event of default occurs and is continuing with respect to Debt Securities of any series, unless the principal of all of the Debt Securities of that series shall have already become due and payable, the Trustee may, in its discretion, and shall upon request in writing made by the holders of not less than 25% in principal amount of the outstanding Debt Securities of that series, declare the principal of (and premium, if any, on) all the outstanding Debt Securities of that series and the interest accrued thereon and all other money, if any, owing under the provisions of the Indenture in respect of those Debt Securities to be due and payable immediately on demand.

Reference is made to the Prospectus Supplement relating to each series of the Debt Securities which are original issue discount Debt Securities for the particular provisions relating to acceleration of the maturity of a portion of the principal amount of such original issue discount securities upon the occurrence of any event of default and the continuation thereof.

Subject to certain limitations set forth in the Indenture, the holders of a majority in principal amount of the outstanding Debt Securities of all series affected by an event of default shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Debt Securities of all series affected by such event of default.

No holder of a debt security of any series will have any right to institute any proceeding with respect to the Indenture, or for the appointment of a receiver or a Trustee, or for any other remedy thereunder, unless:

•: such holder has previously given to the Trustee written notice of a continuing event of default with respect to the Debt Securities of such series affected by such event of default;
•: the holders of at least 25% in aggregate principal amount of the outstanding Debt Securities of such series (voting as one class) affected by such event of default have made written request, and such holder or holders have offered reasonable indemnity, to the Trustee to institute such proceeding as Trustee; and

•: the Trustee has failed to institute such proceeding, and has not received from the holders of a majority in aggregate principal amount of the outstanding Debt Securities of such series affected by such event of default a direction inconsistent with such request, within 60 days after such notice, request and offer.

However, such above-mentioned limitations do not apply to a suit instituted by the holder of a debt security for the enforcement of payment of the principal of or any premium, if any, or interest on such debt security on or after the applicable due date specified in such debt security.

We will annually furnish to the Trustee a statement by certain of our officers as to whether or not Suncor, to the best of their knowledge, is in compliance with all conditions and covenants of the Indenture and, if not, specifying all such known defaults. We will also be required under the Indenture to notify the Trustee as soon as practicable upon becoming aware of any event of default.

Defeasance

Unless otherwise specified in the applicable Prospectus Supplement, the Indenture provides that, at our option, we will be discharged from any and all obligations in respect of the outstanding Debt Securities of any series upon irrevocable deposit with the Trustee, in trust, of money and/or government securities which will provide money in an amount sufficient in the opinion of a nationally recognized firm of independent chartered accountants to pay the principal of and premium, if any, and each installment of interest on the outstanding Debt Securities of such series (hereinafter referred to as a " Defeasance ") (except with respect to the authentication, transfer, exchange or replacement of our Debt Securities or the maintenance of a place of payment and certain other obligations set forth in the Indenture). Such trust may only be established if, among other things:

•: we have delivered to the Trustee an opinion of counsel in the United States stating that (a) Suncor has received from, or there has been published by, the Internal Revenue Service a ruling, or (b) since the date of execution of the Indenture, there has been a change in the applicable U.S. federal income tax law, in either case to the effect that the holders of the outstanding Debt Securities of such series will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Defeasance had not occurred;
•: we have delivered to the Trustee an opinion of counsel in Canada or a ruling from Canada Revenue Agency to the effect that the holders of the outstanding Debt Securities of such series will not recognize income, gain or loss for Canadian federal or provincial income or other tax purposes as a result of such Defeasance and will be subject to Canadian federal or provincial income and other tax on the same amounts, in the same manner and at the same times as would have been the case had such Defeasance not occurred (and for the purposes of such opinion, such Canadian counsel shall assume that holders of the outstanding Debt Securities of such series include holders who are not resident in Canada);
•: we are not an "insolvent person" within the meaning of the Bankruptcy and Insolvency Act (Canada) on the date of such deposit or at any time during the period ending on the 91st day following such deposit;
•: no event of default or event that, with the passing of time or the giving of notice, or both, shall constitute an event of default shall have occurred and be continuing on the date of such deposit; and
•: other customary conditions precedent are satisfied.

We may exercise our Defeasance option notwithstanding our prior exercise of our Covenant Defeasance option, described in the following paragraph, if we meet the conditions described in the preceding sentence at the time we exercise the Defeasance option.

The Indenture provides that, at our option, unless and until we have exercised our Defeasance option described in the preceding paragraph, we may omit to comply with the " Limitation on Liens " and " Consolidation, Amalgamation, Merger and Sale of Assets " covenants and certain other covenants and such omission shall not be deemed to be an event of default under the Indenture and its outstanding Debt Securities upon irrevocable deposit with the Trustee, in trust, of money and/or government securities which will provide money in an amount sufficient in the opinion of a nationally recognized firm of independent chartered

accountants to pay the principal of and premium, if any, and each installment of interest, if any, on the outstanding Debt Securities (hereinafter referred to as " Covenant Defeasance "). If we exercise our Covenant Defeasance option, the obligations under the Indenture other than with respect to such covenants and the events of default other than with respect to such covenants shall remain in full force and effect. Such trust may only be established if, among other things:

•: we have delivered to the Trustee an opinion of counsel in the United States to the effect that the holders of the outstanding Debt Securities will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
•: we have delivered to the Trustee an opinion of counsel in Canada or a ruling from Canada Revenue Agency to the effect that the holders of the outstanding Debt Securities will not recognize income, gain or loss for Canadian federal or provincial income or other tax purposes as a result of such Covenant Defeasance and will be subject to Canadian federal or provincial income and other tax on the same amounts, in the same manner and at the same times as would have been the case had such Covenant Defeasance not occurred (and for the purposes of such opinion, such Canadian counsel shall assume that holders of our outstanding Debt Securities include holders who are not resident in Canada);
•: we are not an "insolvent person" within the meaning of the Bankruptcy and Insolvency Act (Canada) on the date of such deposit or at any time during the period ending on the 91st day following such deposit;
•: no event of default or event that, with the passing of time or the giving of notice, or both, shall constitute an event of default shall have occurred and be continuing on the date of such deposit; and
•: other customary conditions precedent are satisfied.

Modification and Waiver

Modifications and amendments of the Indenture may be made by us and the Trustee with the consent of the holders of a majority in principal amount of the outstanding Debt Securities of each series issued under the Indenture affected by such modification or amendment (voting as one class); provided, however, that no such modification or amendment may, without the consent of the holder of each outstanding debt security of such affected series:

•: change the stated maturity of the principal of, or any installment of interest, if any, on any debt security;
•: reduce the principal amount of, or the premium, if any, or interest rate, if any, on any debt security;
•: change the place of payment;
•: change the currency or currency unit of payment of principal of (or premium, if any) or interest, if any, on any debt security;
•: impair the right to institute suit for the enforcement of any payment on or with respect to any debt security;
•: reduce the percentage of principal amount of outstanding Debt Securities of such series, the consent of the holders of which is required for modification or amendment of the applicable Indenture or for waiver of compliance with certain provisions of the Indenture or for waiver of certain defaults; or
•: modify any provisions of the Indenture relating to the modification and amendment of the Indenture or the waiver of past defaults or covenants except as otherwise specified in the Indenture.

The holders of a majority in principal amount of the outstanding Debt Securities of any series may on behalf of the holders of all Debt Securities of that series waive, insofar as that series is concerned, compliance by us with certain restrictive provisions of the Indenture. The holders of a majority in principal amount of outstanding Debt Securities of any series may waive any past default under the Indenture with respect to that series, except a default in the payment of the principal of (or premium, if any) and interest, if any, on any debt security of that series or in respect of a provision which under the Indenture cannot be modified or amended

without the consent of the holder of each outstanding debt security of that series. The Indenture or the Debt Securities may be amended or supplemented, without the consent of any holder of such Debt Securities, in order to, among other things, cure any ambiguity or inconsistency or to make any change that, in each case, does not adversely affect the rights of any holder of such Debt Securities.

Resignation of Trustee

The Trustee may resign or be removed with respect to one or more series of the Debt Securities and a successor Trustee may be appointed to act with respect to such series. In the event that two or more persons are acting as Trustee with respect to different series of Debt Securities, each such Trustee shall be a Trustee of a trust under the Indenture separate and apart from the trust administered by any other such Trustee, and any action described herein to be taken by the "Trustee" may then be taken by each such Trustee with respect to, and only with respect to, the one or more series of Debt Securities for which it is Trustee.

Consent to Jurisdiction and Service

Under the Indenture, we irrevocably appointed CT Corporation System, 111 8 ^th Avenue, 13 ^th Floor, New York, New York 10011, as our authorized agent for service of process in any suit or proceeding arising out of or relating to the Debt Securities or the Indenture and for actions brought under federal or state securities laws in any federal or state court located in the Borough of Manhattan in The City of New York, and we irrevocably submit to the non-exclusive jurisdiction of such courts.

Governing Law

Our Debt Securities and the Indenture will be governed by and construed in accordance with the laws of the State of New York.

PLAN OF DISTRIBUTION

We may sell Debt Securities to or through underwriters or dealers and may also sell Debt Securities directly to purchasers or through agents.

The applicable Prospectus Supplement will also set forth the terms of the offering relating to the particular Debt Securities, including to the extent applicable, the name or names of any underwriters or agents, the initial public offering price (in the event the offering is a fixed price distribution), our proceeds from the offering, the underwriting discounts or commissions, and any other discounts, commissions or concessions to be allowed or reallowed to dealers. Any initial public offering price and any underwriting discounts, commissions or concessions allowed or reallowed or paid to dealers may be changed from time to time.

The distribution of Debt Securities may be effected from time to time in one or more transactions at a fixed price or non-fixed prices, which may be changed, at market prices prevailing at the time of sale, or at prices related to such prevailing market prices to be negotiated with purchasers.

In connection with the sale of Debt Securities, underwriters may receive compensation from us or from purchasers of Debt Securities for whom they may act as agents in the form of discounts, concessions or commissions. Underwriters, dealers and agents that participate in the distribution of Debt Securities may be deemed to be underwriters and any commissions received by them from us and any profit on the resale of Debt Securities by them may be deemed to be underwriting discounts and commissions under the Securities Act. Any such underwriter or agent will be identified, and any such compensation will be described in the applicable Prospectus Supplement.

If so indicated in the applicable Prospectus Supplement, we may authorize dealers or other persons acting as our agents to solicit offers by certain institutions to purchase the Debt Securities directly from us pursuant to contracts providing for payment and delivery on a future date. These contracts will be subject only to the conditions set forth in the applicable Prospectus Supplement(s), which will also set forth the commission payable for solicitation of these contracts.

Under agreements which may be entered into by us, underwriters, dealers and agents who participate in the distribution of Debt Securities may be entitled to indemnification by us against certain liabilities, including liabilities under the Securities Act and Canadian provincial securities legislation, or to contributions with respect to payments which such underwriters, dealers or agents may be required to make in respect thereof. The underwriters, dealers and agents with whom we enter into agreements may be customers of, engage in transactions with or perform services for us in the ordinary course of business.

In connection with any offering of Debt Securities, the underwriters, dealers or agents may over-allot or effect transactions intended to fix or stabilize the market price of such Debt Securities at a level above that which might otherwise prevail in the open market. Transactions may be begun or interrupted at any time during the distribution. Each series of Debt Securities will be a new issue of Debt Securities with no established trading market. Unless otherwise specified in a Prospectus Supplement relating to a series of Debt Securities, the Debt Securities will not be listed on any securities exchange or on any automated dealer quotation system. Certain broker-dealers may make a market in the Debt Securities, but will not be obligated to do so and may discontinue any market making at any time without notice. We cannot assure you that any broker-dealer will make a market in the Debt Securities of any series or as to the liquidity of the trading market, if any, for the Debt Securities of any series, whether or not the Debt Securities of any series are listed on a securities exchange.

CERTAIN INCOME TAX CONSIDERATIONS

The applicable Prospectus Supplement will describe certain Canadian federal income tax consequences to an investor who is a non-resident of Canada of acquiring any Debt Securities offered thereunder, including whether the payments of principal of, premium, if any, and interest on the Debt Securities will be subject to Canadian non-resident withholding tax.

The applicable Prospectus Supplement will also describe certain United States federal income tax consequences of the acquisition, ownership and disposition of any Debt Securities offered under this Prospectus by an initial investor who is a United States person (within the meaning of the United States Internal Revenue Code), including, to the extent applicable, any such consequences relating to Debt Securities payable in a currency other than the United States dollar, issued at an original issue discount for United States federal income tax purposes or containing early redemption provisions or other special items.

LEGAL MATTERS

Certain legal matters relating to Canadian law in connection with the issuance of the Debt Securities will be passed upon for us by Blake, Cassels & Graydon LLP, Calgary, Alberta, Canada. Certain legal matters relating to United States law in connection with the issuance of the Debt Securities will be passed upon for us by Paul, Weiss, Rifkind, Wharton & Garrison LLP.

INTEREST OF EXPERTS

Certain information relating to our reserves and resources in our Annual Information Form was evaluated or audited by GLJ Petroleum Consultants Ltd., Sproule Associates Limited or Sproule International Limited, each of which is an independent qualified reserves evaluator. The principals of each of GLJ Petroleum Consultants Ltd., Sproule Associates Limited and Sproule International Limited, in each case as a group, own beneficially, directly or indirectly, less than 1% of any class of our outstanding securities.

As of the date of this Prospectus, the partners and associates of Blake, Cassels & Graydon LLP, as a group, beneficially own, directly or indirectly, less than 1% of any class of our outstanding securities.

PricewaterhouseCoopers LLP have confirmed that they are independent within the meaning of the rules of professional conduct of the Institute of Chartered Accountants of Alberta.

DOCUMENTS FILED AS PART OF THE REGISTRATION STATEMENT

The following documents have been filed with the SEC as part of the registration statement of which this Prospectus is a part:

•: the documents listed in the second paragraph under "Documents Incorporated by Reference" in this Prospectus;
•: the consent of our auditors, PricewaterhouseCoopers LLP;
•: the consent of our counsel, Blake, Cassels & Graydon LLP;
•: the consent of our independent petroleum consultant, GLJ Petroleum Consultants Ltd.;
•: the consent of our independent petroleum consultants, Sproule Associates Limited and Sproule International Limited;
•: powers of attorney from directors and officers of Suncor Energy Inc.;
•: the Indenture; and
•: statement of eligibility of the trustee on Form T-1.

PART II

INFORMATION NOT REQUIRED TO BE
DELIVERED TO OFFEREES OR PURCHASERS

Indemnification

Under Section 124 of the Canada Business Corporations Act (the "CBCA"), a corporation may indemnify a present or former director or officer of the corporation or another individual who acts or acted at the corporation's request as a director or officer, or an individual acting in a similar capacity, of another entity, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by the individual in respect of any civil, criminal, administrative, investigative or other proceeding in which the individual is involved because of that association with the corporation or other entity. A corporation may not indemnify an individual unless the individual (i) acted honestly and in good faith with a view to the best interests of the corporation, or, as the case may be, to the best interests of the other entity for which the individual acted as a director or officer or in a similar capacity at the corporation's request and (ii) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the individual had reasonable grounds for believing that the conduct was lawful. The aforementioned individuals are entitled to indemnification from a corporation as a matter of right if they were not judged by the court or other competent authority to have committed any fault or omitted to do anything that the individual ought to have done and if the individual fulfills conditions (i) and (ii) above. A corporation may advance moneys to a director, officer or other individual for the costs, charges and expenses of a proceeding; however, the individual shall repay the moneys if the individual does not fulfill the conditions set out in (i) and (ii) above. The indemnification or the advance of any moneys may be made in connection with a derivative action only with court approval and only if the conditions in (i) and (ii) above are met.

In accordance with the CBCA, the by-laws of the Registrant provide that the Registrant shall indemnify a director or officer of the Registrant, a former director or officer of the Registrant or a person who acts or acted at the Registrant's request as a director or officer, or in a similar capacity, of another entity, and the heirs and legal representatives of such a person, to the extent permitted under the CBCA.

A policy of directors' and officers' liability insurance is maintained by the Registrant which insures directors and officers of the Registrant for losses as a result of claims based upon their acts or omissions as directors and officers, including liabilities under the Securities Act of 1933, as amended (the "Securities Act"), and also reimburses the Registrant for payments made pursuant to the indemnity provisions under the CBCA.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the Registrant pursuant to the foregoing provisions, the Registrant has been informed that in the opinion of the U.S. Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

II-1

Exhibits

Exhibit Number		Description
4.1		Audited comparative consolidated financial statements as at and for the year ended December 31, 2011, including the auditor's report thereon (incorporated by reference from Exhibit No. 99.1 to the Registrant's Form 40-F, filed with the Commission on March 1, 2012).
4.2		Annual information form for the year ended December 31, 2011 dated March 1, 2012 (incorporated by reference from the Registrant's Form 40-F, filed with the Commission on March 1, 2012).
4.3		Management's discussion and analysis of financial condition and results of operations as at and for the year ended December 31, 2011 (incorporated by reference from Exhibit 99.2 to the Registrant's Form 40-F, filed with the Commission on March 1, 2012).
4.4		Management information circular and proxy statement dated March 1, 2012 relating to the annual meeting of our shareholders held on May 1, 2012.
4.5		Unaudited comparative interim consolidated financial statements as at and for the three month period ended March 31, 2012.
4.6		Management's discussion and analysis of financial condition and results of operations as at and for the three month period ended March 31, 2012.
5.1		Consent of PricewaterhouseCoopers LLP.
5.2		Consent of Blake, Cassels & Graydon LLP.
5.3		Consent of GLJ Petroleum Consultants Ltd.
5.4		Consent of Sproule Associates Limited and Sproule International Limited.
6.1		Powers of attorney (included on page III-3 of the Registration Statement).
7.1		Indenture dated June 25, 2007 between the Registrant and The Bank of New York, as Trustee, relating to securities to which this Registration Statement relates.
7.2		Statement of Eligibility under the Trust Indenture Act of 1939, of The Bank of New York Mellon (formerly known as The Bank of New York), as trustee for the indenture referenced at exhibit 7.1 above.

II-2

PART III

UNDERTAKING AND CONSENT TO SERVICE OF PROCESS

Item 1. Undertaking

The Registrant undertakes to make available, in person or by telephone, representatives to respond to inquires made by the Commission staff, and to furnish promptly, when requested to do so by the Commission staff, information relating to the securities registered pursuant to Form F-9 or to transactions in said securities.

Item 2. Consent to Service of Process

(a): Concurrently with the filing of this Registration Statement on Form F-9, the Registrant is filing with the Commission a written irrevocable consent and power of attorney on Form F-X.
(b): Any change to the name or address of the agent for service of the Registrant shall be communicated promptly to the Commission by amendment to Form F-X referencing the file number of the relevant registration statement.

III-1

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-9 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Calgary, Province of Alberta, Canada, on this 15 ^th day of May, 2012.

		SUNCOR ENERGY INC.
		By:	/s/ BART W. DEMOSKY
			Name: Bart W. Demosky Title: Chief Financial Officer

III-2

POWER OF ATTORNEY

Each person whose signature appears below constitutes and appoints each of Janice B. Odegaard and Bart W. Demosky, his or her true and lawful attorney-in-fact and agent, each acting alone, with full power of substitution and resubstitution, for him or her in his or her name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) and supplements to this Registration Statement, and to file the same, with all exhibits hereto, and other documents in connection therewith, with the U.S. Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, each acting alone, full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as they might or could do themselves, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them acting alone, or his or her or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated:

Signature	Title	Date

/s/ STEVEN W. WILLIAMS Steven W. Williams	President, Chief Executive Officer and Director (Principal Executive Officer)	May 15, 2012
/s/ BART W. DEMOSKY Bart W. Demosky	Chief Financial Officer (Principal Financial and Accounting Officer)	May 15, 2012
/s/ JOHN T. FERGUSON John T. Ferguson	Chairman of the Board of Directors	May 15, 2012
/s/ MEL E. BENSON Mel E. Benson	Director	May 15, 2012
/s/ DOMINIC D'ALESSANDRO Dominic D'Alessandro	Director	May 15, 2012
/s/ W. DOUGLAS FORD W. Douglas Ford	Director	May 15, 2012
/s/ PAUL HASELDONCKX Paul Haseldonckx	Director	May 15, 2012
/s/ JOHN R. HUFF John R. Huff	Director	May 15, 2012
/s/ JACQUES LAMARRE Jacques Lamarre	Director	May 15, 2012
/s/ MAUREEN MCCAW Maureen McCaw	Director	May 15, 2012
/s/ MICHAEL W. O'BRIEN Michael W. O'Brien	Director	May 15, 2012
/s/ JAMES W. SIMPSON James W. Simpson	Director	May 15, 2012
/s/ EIRA M. THOMAS Eira M. Thomas	Director	May 15, 2012

III-3

AUTHORIZED REPRESENTATIVE

Pursuant to the requirements of Section 6(a) of the Securities Act of 1933, the Authorized Representative has signed this Registration Statement, solely in his capacity as the duly authorized representative of Suncor Energy Inc. in the United States, on this 15 ^th day of May, 2012.

		SUNCOR ENERGY (U.S.A.) INC. Authorized representative in the United States
		By:	/s/ SHAWN POIRIER
			Name: Shawn Poirier Title: Assistant Secretary

III-4

Exhibit Index

Exhibit Number		Description
4.1		Audited comparative consolidated financial statements as at and for the year ended December 31, 2011, including the auditor's report thereon (incorporated by reference from Exhibit No. 99.1 to the Registrant's Form 40-F, filed with the Commission on March 1, 2012).
4.2		Annual information form for the year ended December 31, 2011 dated March 1, 2012 (incorporated by reference from the Registrant's Form 40-F, filed with the Commission on March 1, 2012).
4.3		Management's discussion and analysis of financial condition and results of operations as at and for the year ended December 31, 2011 (incorporated by reference from Exhibit 99.2 to the Registrant's Form 40-F, filed with the Commission on March 1, 2012).
4.4		Management information circular and proxy statement dated March 1, 2012 relating to the annual meeting of our shareholders held on May 1, 2012.
4.5		Unaudited comparative interim consolidated financial statements as at and for the three month period ended March 31, 2012.
4.6		Management's discussion and analysis of financial condition and results of operations as at and for the three month period ended March 31, 2012.
5.1		Consent of PricewaterhouseCoopers LLP.
5.2		Consent of Blake, Cassels & Graydon LLP.
5.3		Consent of GLJ Petroleum Consultants Ltd.
5.4		Consent of Sproule Associates Limited and Sproule International Limited.
6.1		Powers of attorney (included on page III-3 of the Registration Statement).
7.1		Indenture dated June 25, 2007 between the Registrant and The Bank of New York, as Trustee, relating to securities to which this Registration Statement relates.
7.2		Statement of Eligibility under the Trust Indenture Act of 1939, of The Bank of New York Mellon (formerly known as The Bank of New York), as trustee for the indenture referenced at exhibit 7.1 above.

III-5

QuickLinks

PART I INFORMATION REQUIRED TO BE DELIVERED TO OFFEREES OR PURCHASERS
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS
DOCUMENTS INCORPORATED BY REFERENCE
FORWARD-LOOKING INFORMATION
WHERE YOU CAN FIND MORE INFORMATION
ENFORCEABILITY OF CIVIL LIABILITIES
RISK FACTORS
SUNCOR ENERGY INC.
CONSOLIDATED CAPITALIZATION
USE OF PROCEEDS
EARNINGS COVERAGE RATIOS
TRADING PRICE AND VOLUME
DESCRIPTION OF DEBT SECURITIES
PLAN OF DISTRIBUTION
CERTAIN INCOME TAX CONSIDERATIONS
LEGAL MATTERS
INTEREST OF EXPERTS
DOCUMENTS FILED AS PART OF THE REGISTRATION STATEMENT
PART II INFORMATION NOT REQUIRED TO BE DELIVERED TO OFFEREES OR PURCHASERS
Exhibits
PART III UNDERTAKING AND CONSENT TO SERVICE OF PROCESS
SIGNATURES
POWER OF ATTORNEY
AUTHORIZED REPRESENTATIVE
Exhibit Index

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Exhibit 4.4

MANAGEMENT PROXY CIRCULAR NOTICE OF 2012 ANNUAL GENERAL MEETING MAY 1, 2012

NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS OF SUNCOR ENERGY INC.

The annual general meeting of shareholders of Suncor Energy Inc. (the "Corporation") will be held on May 1, 2012, in the Telus Convention Centre, 120 Ninth Avenue SE, Calgary, Alberta, at 10:30 a.m. Mountain Daylight Time (MDT).

The meeting will have the following purposes:

•: to receive the consolidated financial statements of the Corporation for the year ended December 31, 2011 together with the auditors' report thereon;
•: to elect directors of the Corporation to hold office until the close of the next annual meeting;
•: to appoint auditors of the Corporation to hold office until the close of the next annual meeting;
•: to consider and, if deemed fit, approve an advisory resolution on the Corporation's approach to executive compensation; and
•: to transact such other business as may properly be brought before the meeting or any continuation of the meeting after an adjournment or postponement.

The accompanying management proxy circular provides detailed information relating to the matters to be dealt with at the meeting and forms part of this notice.

Shareholders are encouraged to express their vote in advance by completing the enclosed form of proxy. Detailed instructions on how to complete and return proxies are provided on pages 2 to 4 of the accompanying management proxy circular. To be effective, the completed form of proxy must be received by our transfer agent and registrar, Computershare Trust Company of Canada, Proxy Department, 135 West Beaver Creek, P.O. Box 300, Richmond Hill, Ontario, L4B 4R5, at any time prior to 10:30 a.m. MDT on April 27, 2012.

Shareholders may also vote their shares by telephone or through the internet using the procedures described in the enclosed form of proxy.

Shareholders registered at the close of business on March 5, 2012, will be entitled to receive notice of and vote at the meeting.

By order of the Board of Directors of Suncor Energy Inc.

Janice B. Odegaard
Senior Vice President, General Counsel and Corporate Secretary

March 1, 2012
Calgary, Alberta

INVITATION TO SHAREHOLDERS

Dear Shareholder:

On behalf of Suncor Energy Inc.'s (the "Corporation") board of directors (the "Board of Directors"), management and employees, we invite you to attend our annual general meeting of shareholders on May 1, 2012, to be held in the Telus Convention Centre, 120 Ninth Avenue SE, Calgary, Alberta, at 10:30 a.m. Mountain Daylight Time (MDT).

The items of business to be considered at this meeting are described in the Notice of Annual General Meeting of Shareholders of Suncor Energy Inc. and accompanying management proxy circular. The contents and the sending of this management proxy circular have been approved by the Board of Directors.

Your participation at this meeting is very important to us. We encourage you to vote, which can easily be done by following the instructions enclosed with this management proxy circular. Following the formal portion of the meeting, management will review the Corporation's operational and financial performance during 2011 and provide an outlook on priorities for 2012 and beyond. You will also have an opportunity to ask questions and to meet your directors and executives.

Many of our public documents, including our 2011 Annual Report, are available in the Investor Centre on our web site located at www.suncor.com. We encourage you to visit our web site during the year for information about our company, including news releases and investor presentations. To ensure you receive all the latest news on the Corporation, including the speeches of senior executives, you can use the 'email alerts' subscribe feature on the Corporation's web site. Additional information relating to the Corporation is available on SEDAR at www.sedar.com.

We look forward to seeing you at the meeting.

Yours sincerely,


John Ferguson Chairman of the Board		Rick George Chief Executive Officer

VOTING AND PROXIES: QUESTIONS AND ANSWERS		2
ADVISORIES		5
BUSINESS OF THE MEETING		6
Financial Statements		6
Election of Directors		6
Appointment of Auditors		14
Advisory Vote on Approach to Executive Compensation		14
BOARD OF DIRECTORS COMPENSATION		15
Compensation Philosophy and Approach		15
Compensation Structure		15
Total Compensation		16
Equity-Based Compensation		17
EXECUTIVE COMPENSATION		20
Letter to Shareholders		20
Compensation Discussion and Analysis		23
Compensation Disclosure of Named Executive Officers		41
Termination Agreements and Change of Control Arrangements		46
INDEBTEDNESS OF DIRECTORS, EXECUTIVE OFFICERS AND SENIOR OFFICERS		47
SUMMARY OF INCENTIVE PLANS		48
DIRECTORS' AND OFFICERS' INSURANCE		52
CORPORATE GOVERNANCE		52
SCHEDULE A: DIRECTORS' OUTSTANDING OPTION-BASED AWARDS		A-1
SCHEDULE B: NAMED EXECUTIVE OFFICERS' OUTSTANDING OPTION-BASED AWARDS		B-1
SCHEDULE C: CORPORATE GOVERNANCE SUMMARY		C-1
SCHEDULE D: POSITION DESCRIPTION FOR INDEPENDENT BOARD CHAIR		D-1
SCHEDULE E: DIRECTOR INDEPENDENCE POLICY AND CRITERIA		E-1
SCHEDULE F: BOARD TERMS OF REFERENCE		F-1
Note: All financial information is reported in Canadian dollars unless otherwise noted. Financial information is provided in the Corporation's Comparative Financial Statements and Management's Discussion & Analysis for the year ended December 31, 2011, which is included in our 2011 Annual Report.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 1

VOTING AND PROXIES: QUESTIONS AND ANSWERS

This management proxy circular is dated March 1, 2012 and is furnished in connection with the solicitation by or on behalf of the management of Suncor Energy Inc. ("Suncor", the "Corporation", "our" or "we") of proxies to be used at the annual general meeting of shareholders of Suncor to be held in the Telus Convention Centre, 120 Ninth Avenue SE, Calgary, Alberta, on May 1, 2012, at 10:30 a.m. (MDT) for the purposes indicated in the Notice of Annual General Meeting.

It is expected that solicitation will be primarily by mail, but proxies may also be solicited personally, by telephone or facsimile or other similar means by Suncor employees or agents. Custodians and fiduciaries will be supplied with proxy materials to forward to beneficial owners of common shares of Suncor and normal handling charges will be paid for such forwarding services. The record date to determine which shareholders are entitled to receive notice of and vote at the meeting is March 5, 2012.

Your vote is very important to us. We encourage you to exercise your vote using any of the voting methods described herein. To be valid, completed proxy forms must be dated, completed, signed and deposited with our transfer agent, Computershare Trust Company of Canada ("Computershare"): (i) by mail using the enclosed return envelope or one addressed to Computershare Trust Company of Canada, Proxy Department, 135 West Beaver Creek, P.O. Box 300, Richmond Hill, Ontario, L4B 4R5; (ii) by hand delivery to Computershare, 9 ^th Floor, 100 University Avenue, Toronto, Ontario, M5J 2Y1; or (iii) by facsimile to (416) 263-9524 or 1-866-249-7775. Additionally, you may vote by using the internet at www.investorvote.com or by calling 1-866-732-VOTE (8683). Your proxy instructions must be received in each case no later than 10:30 a.m. (MDT) on April 27, 2012. Please read the following for commonly asked questions and answers regarding voting and proxies.

Q. Am I entitled to vote?

A. You are entitled to vote if you are a holder of common shares of Suncor as of the close of business on March 5, 2012, the record date for the meeting. Each common share is entitled to one vote. A simple majority of votes (50% plus one vote) is required to approve all matters. The list of registered shareholders maintained by Suncor will be available for inspection after March 5, 2012, during usual business hours at the offices of Computershare, 600, 530 - 8th Avenue SW, Calgary, Alberta T2P 3S8 and will be available at the meeting.

Q. What am I voting on?

A. You will be voting on:

•: the election of directors of the Corporation until the close of the next annual meeting;
•: the appointment of PricewaterhouseCoopers LLP as auditors of the Corporation until the close of the next annual meeting; and
•: the advisory resolution on the Corporation's approach to executive compensation disclosed in this management proxy circular.

Q. What if amendments are made to these matters or if other matters are brought before the meeting?

A. If you attend the meeting in person and are eligible to vote, you may vote on such matters as you choose. If you have completed and returned a proxy, the securities represented by proxy will be voted or withheld from voting in accordance with your instructions on any ballot that may be called for and, if you specify a choice with respect to any matter to be acted upon, the securities will be voted accordingly. The persons named in the proxy form will have discretionary authority with respect to amendments or variations to matters identified in the Notice of Annual General Meeting and to other matters that may properly come before the meeting. As of the date of this management proxy circular, our management knows of no such amendment, variation or other matter expected to come before the meeting. If any other matters properly come before the meeting, the persons named in the proxy form will vote on them in accordance with their best judgment.

Q. Who is soliciting my proxy?

A. The management of Suncor is soliciting your proxy. Solicitation of proxies is done primarily by mail, supplemented by telephone or other contact, by our employees or agents at a nominal cost, and all of these costs are paid by Suncor.

Q. How can I vote?

A. If you are eligible to vote and your shares are registered in your name, you can vote your shares in person at the meeting or by completing your proxy form through any of the methods described above.

If your shares are not registered in your name but are held by a nominee, please see below.

2 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Q. How can a non-registered shareholder vote?

A. If your shares are not registered in your name, but are held in the name of a nominee (usually a bank, trust company, securities broker or other financial institution), your nominee is required to seek your instructions as to how to vote your shares. Your nominee will have provided you with a package of information, including these meeting materials and either a proxy or a voting form. Carefully follow the instructions accompanying the proxy or voting form.

Q. How can a non-registered shareholder vote in person at the meeting?

A. Suncor does not have access to all the names of its non-registered shareholders. Therefore, if you are a non-registered shareholder and attend the meeting, we will have no record of your shareholdings or of your entitlement to vote unless your nominee has appointed you as a proxyholder. If you wish to vote in person at the meeting, insert your name in the space provided on the proxy form or voting form sent to you by your nominee. In doing so you are instructing your nominee to appoint you as a proxyholder. Complete the form by following the return instructions provided by your nominee. You should report to a representative of Computershare upon arrival at the meeting.

Q. Who votes my shares and how will they be voted if I return a proxy?

A. By properly completing and returning a proxy, you are authorizing the person named in the proxy to attend the meeting and vote your shares. You can use the enclosed proxy form, or any other proper form of proxy, to appoint your proxyholder.

The shares represented by your proxy must be voted according to your instructions in the proxy. If you properly complete and return your proxy but do not specify how you wish the votes cast, your shares will be voted as your proxyholder sees fit. Unless contrary instructions are provided, shares represented by proxies received by management will be voted:

•: FOR the election of directors from those nominees set out in this management proxy circular;
•: FOR the appointment of PricewaterhouseCoopers LLP as auditors; and
•: FOR the approach to executive compensation disclosed in this management proxy circular.

Q. Can I appoint someone other than the individuals named in the enclosed proxy form to vote my shares?

A. Yes, if you are a registered holder, you have the right to appoint the person of your choice, who does not need to be a shareholder, to attend and act on your behalf at the meeting. If you wish to appoint a person other than the names that appear, then strike out those printed names appearing on the proxy form and insert the name of your chosen proxyholder in the space provided.

NOTE: It is important to ensure that any other person you appoint is attending the meeting and is aware that his or her appointment to vote your shares has been made. Proxyholders should, upon arrival at the meeting, present themselves to a representative of Computershare.

Q. What if my shares are registered in more than one name or in the name of my company?

A. If the shares are registered in more than one name, all those registered must sign the form of proxy. If the shares are registered in the name of your company or any name other than yours, you may require documentation that proves you are authorized to sign the proxy form.

Q. Can I revoke a proxy or voting instruction?

A. If you are a registered shareholder and have returned a proxy, you may revoke it by:

1.

completing and signing a proxy bearing a later date, and delivering it to Computershare; or

2.

delivering a written statement, signed by you or your authorized attorney to:

(a): the Corporate Secretary of Suncor Energy Inc. at P.O. Box 2844 150 - 6 ^th Avenue S.W., Calgary, Alberta, T2P 3E3 at any time up to and including the last business day prior to the meeting, or the business day preceding the day to which the meeting is adjourned; or
(b): to the Chairman of the meeting prior to the start of the meeting.

If you are a non-registered shareholder, contact your nominee.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 3

Q. Is my vote confidential?

A. Your proxy vote is confidential. Proxies are received, counted and tabulated by our transfer agent, Computershare. Computershare does not disclose the results of individual shareholder votes unless: they contain a written comment clearly intended for management; in the event of a proxy contest or proxy validation issue; or if necessary to meet legal requirements.

Q. How many common shares are outstanding?

A. As of February 21, 2012, there were 1,561,810,705 common shares outstanding. We have no other class or series of voting shares outstanding.

As of February 21, 2012, there was no person who, to the knowledge of our directors and officers, beneficially owned, or exercised control or direction, directly or indirectly, over common shares carrying more than 10% of the voting rights attached to all outstanding common shares.

Q. What is electronic delivery?

A. Electronic delivery is voluntary e-mail notification sent to shareholders when documents such as our annual report, quarterly reports and this management proxy circular are available on our web site. If you wish, you may elect to be notified by e-mail when documentation is posted on our web site. Electronic delivery will save paper, reduce our impact on the environment and reduce costs.

Q. How can I ask for electronic delivery?

A. If you are a registered shareholder, go to the Investor Communication web site at www.InvestorDelivery.com and follow the instructions on the screen.

You will need your Control Number and your PIN number (you will find them on the proxy form provided in your package).

Non-registered holders can sign up for mailings (not proxy materials) through www.computershare.com/mailinglist.

Q. What if I have other questions?

A. If you have a question regarding the meeting, please contact Computershare at 1-877-982-8760 or visit www.computershare.com.

Webcast of Meeting

The meeting may also be viewed via webcast on www.suncor.com starting at 10:30 a.m. (MDT) on May 1, 2012. Shareholders may view the meeting and ask questions on line, but will not be able to vote via the webcast.

Shareholder Proposals

Eligible shareholders should direct any proposals they plan to present at the 2013 annual general meeting to our Corporate Secretary. To be included in the management proxy circular, the proposal must be received at Suncor Energy Inc. at P.O. Box 2844, 150 - 6 ^th Avenue S.W., Calgary, Alberta, Canada T2P 3E3 by November 30, 2012.

4 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

ADVISORIES

This management proxy circular contains certain forward-looking statements and other information based on Suncor's current expectations, estimates, projections and assumptions that were made by the company in light of its experience and its perception of historical trends, including expectations and assumptions concerning: the accuracy of reserves and resources estimates; commodity prices and interest and foreign exchange rates; capital efficiencies and cost-savings; applicable royalty rates and tax laws; future production rates; the sufficiency of budgeted capital expenditures in carrying out planned activities; the availability and cost of labour and services; and the receipt, in a timely manner, of regulatory and third-party approvals. All statements and other information that address expectations or projections about the future, and other statements and information about Suncor's strategy for growth, expected and future expenditures, commodity prices, costs, schedules, production volumes, operating and financial results and expected impact of future commitments are forward-looking statements. Some of the forward-looking statements and information may be identified by words like "expects", "guidance", "anticipated", "estimated", "plans", "scheduled", "belief", "projects", "could", "outlook", "target", "objective", and similar expressions. Forward-looking statements in this management proxy circular include references to the following: Suncor's compensation programs; Suncor's ten-year growth plan, which is expected to boost total production to more than one million barrels of oil equivalent per day by 2020; the expectation that Suncor will be able to pool its manpower and capital resources and bring its collective strengths to bear to manage projects using best-in-class operating practices; Suncor's target to reduce current tailing ponds from eight to one; the expectation that discussions with our joint venture operators on the Joslyn project will result in operational synergies; the plan for the economics of Voyageur and Fort Hills to improve as a result of the strategic alliance with Total; and the plan that learnings on Firebag Stage 3 will benefit Firebag Stage 4.

Forward-looking statements and information are not guarantees of future performance and involve a number of risks and uncertainties, some that are similar to other oil and gas companies and some that are unique to Suncor. Suncor's actual results may differ materially from those expressed or implied by its forward-looking statements, and therefore readers are cautioned not to place undue reliance on them.

Additional risks, uncertainties and other factors that could influence financial and operating performance of all of Suncor's operating segments and activities include, but are not limited to: changes in general economic, market and business condition, such as commodity prices, interest rates and currency exchange; fluctuations in supply and demand for Suncor's products; the successful and timely implementation of capital projects, including growth projects and regulatory projects; competitive actions of other companies, including increased competition from other oil and gas companies or from companies that provide alternative sources of energy; labour and material shortages; actions by government authorities, including the imposition of taxes or changes to fees and royalties, and changes in environmental and other regulations; the ability and willingness of parties with whom we have material relationships to perform their obligations to us; the occurrence of unexpected events such as fires, equipment failures and other similar events affecting Suncor or other parties whose operations or assets directly or indirectly affect Suncor; our ability to find new oil and gas reserves that can be developed economically; the accuracy of Suncor's reserves, resources and future production estimates; market instability affecting Suncor's ability to borrow in the capital debt markets at acceptable rates; maintaining an optimal debt to cash flow ratio; the success of the company's risk management activities using derivatives and other financial instruments; the cost of compliance with current and future environmental laws; risks and uncertainties associated with closing a transaction for the purchase or sale of an oil and gas property, including estimates of the final consideration to be paid or received, the ability of counterparties to comply with their obligations in a timely manner and the receipt of any required regulatory or other third-party approvals outside of Suncor's control that are customary to transactions of this nature; the accuracy of cost estimates, some of which are provided at the conceptual or other preliminary stage of projects and prior to commencement or conception of the detailed engineering that is needed to reduce the margin of error and increase the level of accuracy; failure to realize anticipated synergies or cost savings; risks regarding the integration of Suncor and Petro-Canada after the merger; and incorrect assessments of the values of assets acquired and liabilities assumed in the merger with Petro-Canada. The foregoing important factors are not exhaustive.

Suncor's Annual Information Form and Management's Discussion and Analysis for the year ended December 31, 2011 and other documents it files from time to time with securities regulatory authorities describe the risks, uncertainties, material assumptions and other factors that could influence actual results and such factors are incorporated herein by reference. Copies of these documents are available without charge from Suncor at 150 6th Avenue S.W., Calgary, Alberta T2P 3E3, by calling 1-800-558-9071, or by email request to info@suncor.com or by referring to the company's profile on SEDAR at www.sedar.com or EDGAR at www.sec.gov. Except as required by applicable securities laws, Suncor disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Certain natural gas volumes described in this management proxy circular have been converted to barrels of oil equivalent ("boe") on the basis of one barrel for every six thousand cubic feet of natural gas. Any figure presented in boe may be misleading, particularly if used in isolation. A conversion ratio of six thousand cubic feet of natural gas to one barrel of crude oil is based on an energy equivalency conversion method primarily applicable at the burner tip and does not necessarily represent value equivalency at the wellhead.

Certain financial measures described in this management proxy circular – namely operating earnings, cash flow from operations and return on capital employed (ROCE) – are not prescribed by Canadian generally accepted accounting principles ("GAAP"). These non-GAAP measures are defined and reconciled in the Non-GAAP Financial Measures Advisory section of Suncor's Management's Discussion and Analysis for the year ended December 31, 2011 (the "MD&A"). In relation to cash flow from operations as described on page 32 of this management proxy circular, values reported equal cash flows from operations as reported in the MD&A, adjusted to take into account the timing of divestitures, which resulted in a reduction of the cash flow from operations used for measuring compensation. These non-GAAP financial measures do not have any standardized meaning and therefore are unlikely to be comparable to similar measures presented by other companies. These non-GAAP financial measures are described because management uses the information to analyze operating performance, leverage and liquidity. Therefore, these non-GAAP financial measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 5

BUSINESS OF THE MEETING

FINANCIAL STATEMENTS

The audited consolidated financial statements for the year ended December 31, 2011 and the report of the auditors thereon will be placed before the meeting. These audited consolidated financial statements form part of our 2011 Annual Report. Copies of the 2011 Annual Report may be obtained from the Corporate Secretary upon request and will be available at the meeting. The full text of the 2011 Annual Report is available on Suncor's web site at www.suncor.com and has been filed with the Canadian securities regulatory authorities and the U.S. Securities and Exchange Commission.

ELECTION OF DIRECTORS

Number of Directors. Suncor's articles stipulate there shall be not more than 15 nor fewer than 8 directors. There are currently 14 directors. In accordance with our by-laws, the Board of Directors of Suncor (the "Board" or "Board of Directors") has determined that 12 directors will be elected at the meeting. The term of office of each director is from the date of the meeting at which he or she is elected or appointed until the next annual meeting of shareholders or until a successor is elected or appointed.

Richard L. George, Suncor's long-standing Chief Executive Officer ("CEO"), in December of 2011, announced that he would retire at the 2012 annual general meeting and would not stand for re-election as a director. During his tenure, Mr. George has shown exceptionally strong leadership, helping to transform Suncor from an oil sands pioneer into Canada's largest energy company. The Board deeply appreciates his commitment to Suncor, and also his commitment to the industry and his contributions to Alberta and Canada.

In addition, Brian F. MacNeill, after 17 years of service to Petro-Canada and subsequent to the merger, Suncor, will be retiring from the Board this year and will not stand for re-election. Mr. MacNeill has provided a significant contribution to Petro-Canada and Suncor's success through his sound business acumen and dedication during his tenure. Suncor's management wishes to thank Mr. MacNeill for his service to Suncor and its shareholders.

Unless authority to do so is withheld, the persons named in the accompanying form of proxy intend to vote FOR the election of the nominees whose names appear on pages 7 to 12. Management does not expect that any of the nominees will be unable to serve as a director but, if that should occur for any reason prior to the meeting, the persons named in the accompanying form of proxy reserve the right to vote for another nominee at their discretion unless the proxy specifies the common shares are to be withheld from voting in the election of directors.

Majority Voting for Directors. The Board has adopted a policy that requires that any nominee for director who receives a greater number of votes "withheld" than votes "for" his or her election as a director shall submit his or her resignation to the Governance Committee of the Board for consideration promptly following the meeting. This policy applies only to uncontested elections, meaning elections where the number of nominees for directors is equal to the number of directors to be elected. The Governance Committee shall consider the resignation and shall provide a recommendation to the Board. The Board will consider the recommendation of the Governance Committee and determine whether to accept it within 90 days of the applicable meeting and a news release will be issued by Suncor announcing the Board's determination. A director who tenders his or her resignation will not participate in any meetings to consider whether the resignation shall be accepted.

Shareholders should note that, as a result of the majority voting policy, a "withhold" vote is effectively the same as a vote against a director nominee in an uncontested election.

6 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

The Persons Nominated for Election as Directors Are:

Mel E. Benson
63
Calgary, Alberta, Canada
Director from April 19, 2000 to present

Independent

Mel Benson is president of Mel E. Benson Management Services Inc., an international management consulting firm based in Calgary, Alberta. In 2000, Mr. Benson retired from a major international oil company. Mr. Benson is an owner of Tenex Energy Inc. and a director of Winalta Inc. and Fort McKay Group of Companies, a community trust. He is also a director of Hull Child and Family Services, a non-profit organization.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	Winalta Inc.
Human Resources and Compensation	6 of 6	100%
Environment, Health, Safety and Sustainable Development (Chair)	4 of 4	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	17 548	47 231	Nil	64 779	1 903 207	Yes	3.5x
2010	17 548	41 842	Nil	59 390	2 273 449
2009	17 548	35 253	Nil	52 801	1 964 725

Options and Value of Options ($) ⁽⁷⁾ :

2011	2010	2009

16 000	16 000	16 000
Nil	Nil	Nil

Dominic D`Alessandro
65
Toronto, Ontario, Canada
Director from November 12, 2009 to present

Independent

Dominic D'Alessandro was president and chief executive officer of Manulife Financial Corporation from 1994 to 2009 and is currently a director of CGI Group Inc. and Canadian Imperial Bank of Commerce. For his many business accomplishments, Mr. D'Alessandro was recognized as Canada's Most Respected CEO in 2004 and CEO of the Year in 2002, and was inducted into the Insurance Hall of Fame in 2008. Mr. D'Alessandro is an officer of the Order of Canada and has been appointed as a Commendatore of the Order of the Star of Italy. In 2009, he received the Woodrow Wilson Award for Corporate Citizenship and in 2005 was granted the Horatio Alger Award for community leadership. Mr. D'Alessandro is an FCA, and holds a Bachelor of Science from Concordia University in Montreal. He has also been awarded honorary doctorates from York University, the University of Ottawa, Ryerson University and Concordia University.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	Canadian Imperial Bank of Commerce
Audit	7 of 7	100%	CGI Group Inc.
Governance	5 of 5	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	10 000	22 483	Nil	32 483	954 351	Yes	1.8x
2010	10 000	14 612	Nil	24 612	942 147
2009	10 000	6 862	Nil	16 862	627 435

Options and Value of Options ($) ⁽⁷⁾ : Nil

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 7

John T. Ferguson
70
Edmonton, Alberta, Canada
Director from November 10, 1995 to present

Independent

John Ferguson is founder and chairman of the board of Princeton Developments Ltd. and Princeton Ventures Ltd. Mr. Ferguson is also a director of Fountain Tire Ltd. and Strategy Summit Ltd. and until March 1, 2012 was a director of Royal Bank of Canada. In addition, he is a member of the Order of Canada, a board member of the Alberta Bone and Joint Institute, an advisory member of the Canadian Institute for Advanced Research, Honorary Colonel – South Alberta Light Horse and chancellor emeritus and chairman emeritus of the University of Alberta. Mr. Ferguson is a fellow of the Alberta Institute of Chartered Accountants and of the Institute of Corporate Directors.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors (Chairman)	7 of 7	100%	None


Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	50 298	78 124	Nil	128 422	3 773 038	Yes	2.7x
2010	49 483	65 903	Nil	115 386	4 416 976
2009	45 785	53 987	Nil	99 772	3 712 516

Options and Value of Options ($) ⁽⁷⁾ :

2011	2010	2009

68 000	84 000	100 000
672 400	1 541 360	1 940 400

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

4 445 438	5 958 336	5 652 916

Douglas Ford
68
Bonita Springs, Florida, USA
Director from April 29, 2004 to present

Independent

W. Douglas Ford was chief executive, refining and marketing for BP p.l.c. from 1998 to 2002 and was responsible for the refining, marketing and transportation network of BP as well as the aviation fuels business, the marine business and BP shipping. Mr. Ford currently serves as a director of USG Corporation and Air Products and Chemicals Inc. He is also a member of the board of trustees of the University of Notre Dame.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	Air Products & Chemicals Inc.
Human Resources and Compensation	6 of 6	100%	USG Corporation
Governance	5 of 5	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	Nil	56 798	Nil	56 798	1 668 725	Yes	3.1x
2010	Nil	48 500	Nil	48 500	1 856 580
2009	Nil	40 409	Nil	40 409	1 503 619

Options and Value of Options ($) ⁽⁷⁾ :

2011	2010	2009

40 000	40 000	40 000
256 960	470 560	444 880

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

1 925 685	2 327 140	1 948 499

8 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Paul Haseldonckx
63
Essen, Germany
Director from July 31, 2009 to present
(Petro-Canada from 2002-2009)

Independent

Paul Haseldonckx was a director of Petro-Canada and a member of the management board of Veba Oel AG, Germany's largest downstream company, including Aral AG gas stations in Europe. Mr. Haseldonckx represented Veba's interests at the board of the Cerro Negro joint venture, an in situ oil sands development including an upgrader, during the construction and early production phase. Mr. Haseldonckx holds a Master of Science and completed Executive Programs at INSEAD, Fontainebleau and IMD, Lausanne.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	None
Audit	7 of 7	100%
Environment, Health, Safety and Sustainable Development	4 of 4	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	12 103	16 883	4 050	33 036	970 598	Yes	1.8x
2010	12 060	11 897	3 998	27 955	1 070 117
2009	12 020	7 052	3 950	23 022	856 649

Options and Value of Options ($) ⁽⁷⁾ : Nil

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

970 598	1 070 117	856 649

John R. Huff
65
Houston, Texas, USA
Director from January 30, 1998 to present

Independent

John Huff is chairman of Oceaneering International Inc., an oilfield services company. He also serves as director of KBR Inc.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	KBR Inc.
Environment, Health, Safety and Sustainable Development	4 of 4	100%	Oceaneering International Inc.
Human Resources and Compensation	6 of 6	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	43 058	80 240	Nil	123 298	3 622 495	Yes	6.7x
2010	43 018	71 666	Nil	114 684	4 390 104
2009	42 983	63 388	Nil	106 371	3 958 065

Options and Value of Options ($) ⁽⁷⁾ :

2011	2010	2009

64 000	80 000	96 000
672 400	1 541 360	1 940 400

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

4 294 895	5 931 464	5 898 465

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 9

Jacques Lamarre
68
Montreal, Quebec, Canada
Director from November 12, 2009 to present

Independent

Jacques Lamarre is a strategic advisor to the law firm Heenan Blaikie LLP. He was the president and chief executive officer of SNC-Lavalin from 1996 to 2009. Mr. Lamarre is an Officer of the Order of Canada and a founding member and past chair of the Commonwealth Business Council. He is also past chair of the board of directors of the Conference Board of Canada and a founding member of the World Economic Forum's Governors for Engineering & Construction. Currently, he serves as director of the Royal Bank of Canada, PPP Canada Inc. and the Canadian Institute for Advanced Research, and as a member of the Engineering Institute of Canada, Engineers Canada and the Ordre des ingénieurs du Québec. Mr. Lamarre holds a Bachelor of Arts and a Bachelor of Arts and Science in Civil Engineering from Université Laval in Quebec City. He also completed Harvard University's Executive Development Program. In addition, Mr. Lamarre holds honorary doctorates from the University of Waterloo, the University of Moncton and Université Laval.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	Royal Bank of Canada
Environment, Health, Safety and Sustainable Development	4 of 4	100%
Human Resources and Compensation	6 of 6	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	11 280	22 297	Nil	33 577	986 492	Yes	1.8x
2010	6 280	14 490	Nil	20 770	795 076
2009	6 280	6 849	Nil	13 129	488 530

Options and Value of Options ($) ⁽⁷⁾ : Nil

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

986 492	795 076	488 530

Maureen McCaw
57
Edmonton, Alberta, Canada
Director from July 31, 2009 to present
(Petro-Canada from 2004 to 2009)

Independent

Maureen McCaw was a director of Petro-Canada and is past president (Edmonton) of Leger Marketing, formerly Criterion Research Corp., a company she founded in 1986. Ms. McCaw holds a Bachelor of Arts from the University of Alberta and an Institute of Corporate Directors certification (ICD.D). In addition to being president of Tinnakilly Inc. and a director of the Edmonton International Airport, Women Building Futures, Nature Conservancy of Canada, Alberta chapter and Royal Alexandra Hospital, she is also managing partner at Prism Ventures. She is a past chair of the Edmonton Chamber of Commerce and serves on a number of Alberta boards and advisory committees.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	None
Environment, Health, Safety and Sustainable Development	4 of 4	100%
Human Resources and Compensation	6 of 6	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	7 750	32 844	Nil	40 594	1 192 652	Yes	2.2x
2010	7 693	24 901	Nil	32 594	1 247 698
2009	7 640	17 176	Nil	24 816	923 403

Options and Value of Options ($) ⁽⁷⁾ : Nil

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

1 192 682	1 247 698	923 403

10 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Michael W. O'Brien
67
Canmore, Alberta, Canada
Director from April 26, 2002 to present

Independent

Michael O'Brien served as executive vice president, corporate development, and chief financial officer of Suncor Energy Inc. before retiring in 2002. Mr. O'Brien is lead director of Shaw Communications Inc. In addition, he is past chair of the board of trustees for Nature Conservancy Canada, past chair of the Canadian Petroleum Products Institute and past chair of Canada's Voluntary Challenge for Global Climate Change.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	Shaw Communications Inc.
Audit (Chair)	7 of 7	100%
Governance	5 of 5	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	26 808	44 216	Nil	71 024	2 086 685	Yes	3.9x
2010	51 808	38 868	Nil	90 676	3 471 077
2009	51 808	33 705	Nil	85 513	3 181 939

Options and Value of Options ($) ⁽⁷⁾ :

2011	2010	2009

48 000	48 000	48 000
427 440	712 240	678 000

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

2 514 125	4 183 317	3 859 939

James W. Simpson
67
Calgary, Alberta, Canada
Director from July 31, 2009 to present
(Petro-Canada from 2004-2009)

Independent

James Simpson was a director of Petro-Canada and is past president of Chevron Canada Resources (oil and gas). He serves as lead director for Canadian Utilities Limited and is on its Corporate Governance, Nomination, Compensation and Succession Committee and Risk Review Committee, as well as being the chairman for the Audit Committee. Mr. Simpson holds a Bachelor of Science and Master of Science, and graduated from the Program for Senior Executives at M.I.T.'s Sloan School of Business. He is also past chairman of the Canadian Association of Petroleum Producers and past vice chairman of the Canadian Association of the World Petroleum Congresses.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	Canadian Utilities Limited
Human Resources and Compensation (Chair)	6 of 6	100%
Governance	5 of 5	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	4 736	28 693	Nil	33 429	982 144	Yes	1.8x
2010	4 736	22 047	Nil	26 783	1 025 253
2009	4 736	15 551	Nil	20 287	754 879

Options and Value of Options ($) ⁽⁷⁾ : Nil

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

982 144	1 025 253	754 879

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 11

Eira M. Thomas
43
West Vancouver, British Columbia, Canada
Director from April 27, 2006 to present

Independent

Eira Thomas is a Canadian geologist with over twenty years of experience in the Canadian diamond business, including her previous roles as vice president of Aber Resources, now Harry Winston Diamond Corp., and as founder and CEO of Stornoway Diamond Corp. Currently, Ms. Thomas is a director of Lucara Diamond Corp. and Strongbow Exploration Inc. She also serves on the board of the Prospectors and Developers Association of Canada.


Suncor Board and Board Committees	Meeting Attendance		Other Public Company Boards

Board of Directors	7 of 7	100%	Lucara Diamond Corp.
Audit	7 of 7	100%	Strongbow Exploration Inc.
Governance	5 of 5	100%

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	4 000	37 759	Nil	41 759	1 226 879	Yes	2.3x
2010	4 000	31 064	Nil	35 064	1 342 250
2009	4 000	24 555	Nil	28 555	1 062 532

Options and Value of Options ($) ⁽⁷⁾ :

2011	2010	2009

24 000	24 000	24 000
Nil	Nil	Nil

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

1 226 879	1 342 250	1 062 532

Steven W. Williams
56
Calgary, Alberta, Canada
Director from December 1, 2011 to present

Non-independent
Management

Steve Williams has served as the chief operating officer of Suncor Energy Inc. since 2007. He was appointed as President of Suncor Energy Inc. in December of 2011. Mr. Williams is a fellow of the Institute of Chemical Engineers and is a member of the Institute of Directors. He is also co-chair of the Oil Sands Leadership Initiative (OSLI), a member of the CEO Committee of Syncrude Canada Limited, and a member of the Business Advisory Council, School of Business at the University of Alberta. In October of 2010, he was appointed to the Alberta Government Oil and Gas Economics Advisory Council.


Suncor Board and Board Committees	Meeting Attendance	Other Public Company Boards

Board of Directors	N/A ⁽⁹⁾	None

Securities Held:

						Share Ownership Target ⁽⁶⁾
				Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Share Ownership Target ⁽⁶⁾
Fiscal Year	Common Shares ⁽¹⁾	DSUs ⁽²⁾	RSUs ⁽³⁾	Total Common Shares, DSUs and RSUs ⁽⁴⁾	Total Value of Common Shares, DSUs and RSUs ($) ⁽⁵⁾	Meets Target	Current Status

2011	215 672	38 733	Nil	254 405	7 474 419	Yes	2.3x
2010	31 940	13 399	Nil	45 339	1 740 111
2009	28 194	Nil	Nil	28 194	1 049 099

Options and Value of Options ($) ⁽⁷⁾ :

2011	2010	2009

964 400	944 000	814 000
3 911 700	11 998 400	10 627 500

Total Value of Equity ($) ⁽⁸⁾ :
2011	2010	2009

11 386 119	13 738 511	11 676 599

12 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

(1): Common shareholdings include the number of Suncor common shares, excluding fractional amounts, beneficially owned, or controlled or directed, directly or indirectly, by the director as at December 31 of the year reported. As at February 21, 2012, there had been no changes to the share ownership of the directors.
(2): Deferred share units ("DSUs") are not voting securities but are included in this table for information purposes and refers to the number of DSUs for each director, excluding fractional amounts, as at December 31 of the year reported. DSUs were granted pursuant to the Suncor Deferred Share Unit Plan (the "DSU Plan") and the closed Petro-Canada Deferred Share Unit Plan (Non-Employee Directors of Petro-Canada) (the "PCCDSU Plan"). See "Board of Directors Compensation – Equity-Based Compensation" on page 17 and "Summary of Incentive Plans – Closed Plans" on page 49 of this management proxy circular.
(3): Restricted share units ("RSUs") for non-employee directors of Suncor are not voting securities but are included in this table for information purposes and refers to the number of RSUs for each director, excluding fractional amounts, as at December 31 of the year reported. RSUs were granted pursuant to the closed Petro-Canada Restricted Share Unit Plan (Non-Employee Directors of Petro-Canada) (the "PCRSU Plan"). See "Summary of Incentive Plans – Closed Plans" on page 49 of this management proxy circular.
(4): Total number of Suncor common shares, DSUs and RSUs, excluding fractional amounts, as at December 31 of the year reported.
(5): Total value reflects the number of Suncor common shares, DSUs and RSUs held by the director as at December 31 of the year reported multiplied by the closing price on the Toronto Stock Exchange (the "TSX") of a Suncor common share on December 31 of the year reported (December 31, 2011 ($29.38), December 31, 2010 ($38.28) and December 31, 2009 ($37.21)).
(6): Current status reflects the multiple of the minimum share ownership target required to be met by the director as at December 31, 2011. See "Board of Directors Compensation – Compensation Structure – Share Ownership Guidelines" on page 16 of this management proxy circular for non-employee directors and "Compensation Discussion and Analysis — Our Approach to Executive Compensation – Executive Share Ownership Guidelines" on page 29 of this management proxy circular for Steven W. Williams for further information.
(7): Directors' options are not voting securities but have been included in this table for information purposes. Directors' options for non-employee directors include only options granted on or prior to December 31, 2008, as Suncor discontinued grants effective January 1, 2009 for non-employee directors. The number of options for each director as at December 31 of the year reported. The value of options for a year reported reflects the 'in-the-money' amount (the difference between the closing price on the TSX of a Suncor common share on December 31 for the year reported (December 31, 2011 ($29.83), December 31, 2010 ($38.28) and December 31, 2009 ($37.21)) and the exercise price of the option) of the exercisable and non-exercisable options held as at December 31 of the year reported.
(8): Total value reflects the value of all Suncor common shares, DSUs, RSUs and options held as at December 31 of the year reported calculated in accordance with footnote (5) and (7).
(9): Mr. Williams was appointed to the Board at the last Board meeting of 2011 and therefore attended no meeting of the Board or any committee meeting of the Board in his capacity as a director in 2011.

Cease Trade Orders, Bankruptcies, Penalties or Sanctions. To our knowledge, no proposed director: (i) is, or has been in the last ten years, a director, chief executive officer or chief financial officer of an issuer (including Suncor) that, (a) while that person was acting in that capacity was the subject of a cease trade order or similar order or an order that denied the issuer access to any exemption under securities legislation, for a period of more than 30 consecutive days, (b) was subject to a cease trade order or similar order or an order that denied the issuer access to any exemption under securities legislation, for a period of more than 30 consecutive days, which resulted from an event that occurred while that person was acting in the capacity of director, chief executive officer or chief financial officer, which resulted, after that person ceased to be a director, chief executive officer or chief financial officer, in the issuer being the subject of a cease trade or similar order or an order that denied the issuer access to any exemption under securities legislation, for a period of more than 30 consecutive days, or (c) is, or has been in the last ten years, a director or executive officer of an issuer that, while that person was acting in the capacity or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets, other than Mr. Ford, a current and proposed director of Suncor, who is currently a director of USG Corporation, which was in bankruptcy protection until June, 2006, and who was also a director of United Airlines (until February 2006) which was in Chapter 11 bankruptcy protection until February, 2006; (ii) has, within the last 10 years, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold their assets; or (iii) has been subject to: (a) any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority, or (b) any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to vote for a proposed director.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 13

APPOINTMENT OF AUDITORS

Management and the Board propose that PricewaterhouseCoopers LLP be appointed as Suncor's auditors until the close of the next annual meeting. PricewaterhouseCoopers LLP have been Suncor's auditors for more than five years.

Fees payable to PricewaterhouseCoopers LLP in 2010 and 2011 are detailed below.

($ thousands)	2010	2011


Audit Fees	4 873	6 145
Audit-Related Fees	637	423
Tax Fees	—	50
All Other Fees	4	9

Total	5 514	6 627

The nature of each category of fees is described below.

Audit Fees. Audit fees were paid for professional services rendered by the auditors for the audit of Suncor's annual financial statements, or services provided in connection with statutory and regulatory filings or engagements.

Audit-Related Fees. Audit-related fees were paid for professional services rendered by the auditors for preparation of reports on specified procedures as they relate to joint venture audits and attest services not required by statute or regulation.

Tax Fees. Tax fees were paid for corporate tax filings and tax planning in a foreign jurisdiction where Suncor has limited activity.

All Other Fees. All other fees were paid for subscriptions to auditor-provided and supported tools.

The services described beside the captions "Audit Fees", "Audit-Related Fees", "Tax Fees" and "All Other Fees" were approved by the Audit Committee pursuant to paragraph (c)(7)(i) of Rule 2-01 of Regulation S-X.

ADVISORY VOTE ON APPROACH TO EXECUTIVE COMPENSATION

The Board believes that shareholders should have the opportunity to fully understand the objectives, philosophy and principles that the Board has used to make executive compensation decisions.

We hope you will carefully review the "Letter to Shareholders" beginning on page 20 and our "Compensation Discussion and Analysis" beginning on page 23 of this management proxy circular before voting on this matter. We encourage any shareholder who has comments on our approach to executive compensation to forward these comments to the chair of the Human Resources and Compensation Committee (the "HR&CC") c/o the Corporate Secretary, Suncor Energy Inc. P.O. Box 2844, 150 - 6 ^th Avenue S.W., Calgary, Alberta, T2P 3E3. The "Compensation Discussion and Analysis" section discusses our compensation philosophy and approach to executive compensation, what our named executive officers are paid and how their level of compensation is determined. This disclosure has been approved by the Board on the recommendation of the HR&CC.

At the meeting, shareholders will have an opportunity to vote on our approach to executive compensation through consideration of the following advisory resolution:

"Resolved, on an advisory basis and not to diminish the role and responsibilities of the Board of Directors, that the shareholders accept the approach to executive compensation disclosed in the management proxy circular of Suncor Energy Inc. delivered in advance of its 2012 annual meeting of shareholders."

As this is an advisory vote, the results will not be binding upon the Board. However, in considering its approach to compensation in the future, the Board will take into account the results of the vote, together with feedback received from shareholders in the course of our engagement activities.

14 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

BOARD OF DIRECTORS COMPENSATION

The Board is composed of 12 non-employee directors, including the chairman of the Board, and Richard L. George, our CEO, and Steven W. Williams, our President and Chief Operating Officer ("COO"). Both Richard L. George and Brian F. MacNeill are retiring in 2012 and therefore are not standing for re-election as directors. Following the annual general meeting, and assuming that all directors are elected as contemplated in this management proxy circular, the Board will be composed of 11 non-employee directors and Steven W. Williams, who will be Suncor's President and CEO upon Richard L. George's retirement.

COMPENSATION PHILOSOPHY AND APPROACH

The compensation of non-employee directors is intended to attract highly qualified individuals with the capability to meet the demanding responsibilities of Board members and to closely align non-employee directors' interests with shareholder interests. Non-employee director compensation is not incentive based. Richard L. George and Steven W. Williams do not receive additional compensation for Board service.

The Governance Committee reviews Board compensation levels annually to ensure Suncor's approach to Board compensation is competitive at the median of the Suncor Compensation Peers, as such term is defined on page 29 of this management proxy circular, reflects best practice and takes into account governance trends.

COMPENSATION STRUCTURE

The North American energy peers, defined as the Suncor Compensation Peers, for benchmarking director compensation are the same companies used for benchmarking senior executive compensation for Suncor, as provided for on page 29 of this management proxy circular. Where Suncor ranks, as compared to the Suncor Compensation Peers, in relation to revenues, market capitalization and assets, is also provided for on page 29 of this management proxy circular.

The compensation structure for the Board's members did not change from 2010 to 2011. The following table displays the compensation structure for 2011 for all non-employee directors, including the chairman of the Board.

Compensation Structure for Non-Employee Directors (Excluding Chairman of the Board)		($)


Retainer and Fees
Annual Retainer ⁽¹⁾		50 000
Annual Committee Chair Retainer:
	Audit Committee	25 000
	Environment, Health, Safety and Sustainable Development ("EHS&SD") Committee	10 000
	Governance Committee	10 000
	Human Resources and Compensation Committee ("HR&CC")	15 000
Annual Committee Member Retainer:
	Audit Committee	6 000
	EHS&SD Committee	5 000
	Governance Committee	5 000
	HR&CC	5 000
Board Meeting Fee		1 500
Committee Meeting Fee		1 500
Travel within continental North America (Per Round Trip) ⁽²⁾		1 500
Travel originating from outside continental North America (Per Round Trip) ⁽³⁾		3 000
Annual Equity
Annual DSU target value ⁽⁴⁾		180 000

Compensation Structure for Chairman of the Board ⁽⁵⁾		($)


Retainer and Fees
Annual Retainer ⁽¹⁾		250 000
Travel within continental North America (Per Round Trip) ⁽²⁾		1 500
Travel originating from outside continental North America (Per Round Trip) ⁽³⁾		3 000
Annual Equity
Annual DSU target value ⁽⁴⁾		280 000

(1): Annual retainer is payable as elected by the non-employee director. Each year, a non-employee director may elect to receive their fees in 100% cash, 50% cash and 50% DSUs or 100% DSUs. All non-employee directors must receive at least 50% of their annual retainer and meeting fees in DSUs until their share ownership guideline level has been met.
(2): Provides for travel from principal residence within continental North America to attend Board, committee or orientation meetings.
(3): Provides for travel from principal residence outside North America to attend Board, committee or orientation meetings.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 15

(4): The number of DSUs to be awarded in 2011 was set by the Board at the beginning of 2011 based on target values for non-employee directors (other than the chairman of the Board) of $180,000 (which equaled 4,800 DSUs) and the chairman of the Board of $280,000 (which equaled 7,400 DSUs). DSUs are administered quarterly.
(5): No other compensation was payable to the chairman of the Board for 2011.

Share Ownership Guidelines. One way non-employee directors demonstrate their commitment to Suncor's long-term success and alignment with shareholders is through share ownership. The Board has established share ownership guidelines for non-employee directors, which must be attained within five years of when they were first elected or appointed.

For 2011, each non-employee director was required to own Suncor common shares, DSUs and/or RSUs with a market value of $540,000, and the chairman of the Board was required to own Suncor common shares, DSUs and/or RSUs with a market value of $1,400,000. As at February 21, 2012, all non-employee directors, including the chairman of the Board, met their share ownership guidelines.

Share ownership guidelines are reviewed periodically based on survey data. The current share ownership guideline level was determined to be appropriate for 2012.

2011 Committee Membership. Non-employee directors were on the following committees.

Committee Members	Audit Committee	Governance Committee	EHS&SD Committee	HR&CC


Mel E. Benson			Chair	ü
Brian A. Canfield ⁽¹⁾	Chair ⁽²⁾		ü
Dominic D'Alessandro	ü	ü
W. Douglas Ford		ü		ü
Paul Haseldonckx	ü		ü
John R. Huff			ü	ü
Jacques Lamarre			ü	ü
Brian F. MacNeill	ü	Chair
Maureen McCaw			ü	ü
Michael W. O'Brien	Chair ⁽²⁾	ü
James W. Simpson		ü		Chair
Eira M. Thomas	ü	ü

(1): Mr. Canfield retired as a member of the Board, Audit Committee and EHS&SD Committee effective May 3, 2011.
(2): Mr. Canfield acted as chair of Audit Committee until his retirement on May 3, 2011, following which Mr. O'Brien was appointed to act in such capacity.

TOTAL COMPENSATION

Total Compensation Summary. The following table provides information on the total compensation paid to the non-employee directors for the year ended December 31, 2011.

($)

Name ⁽¹⁾	Total Fees Paid	Share-Based Awards ⁽²⁾	Total Compensation ⁽³⁾


Mel E. Benson	92 000	164 208	256 208
Brian A. Canfield ⁽⁴⁾	55 000	51 840	106 840
Dominic D'Alessandro	94 000	164 208	258 208
John T. Ferguson	256 000	253 154	509 154
W. Douglas Ford	93 000	164 208	257 208
Paul Haseldonckx	100 000	164 208	264 208
John R. Huff	91 500	164 208	255 708
Jacques Lamarre	91 500	164 208	255 708
Brian F. MacNeill	96 000	164 208	260 208
Maureen McCaw	91 500	164 208	255 708
Michael W. O'Brien	105 250	164 208	269 458
James W. Simpson	98 500	164 208	262 708
Eira M. Thomas	95 500	164 208	259 708

Total	1 359 750	2 111 282	3 471 032

(1): Richard L. George, Suncor's CEO, and Steven W. Williams, Suncor's President and COO, did not receive compensation for serving as members of the Board. Please refer to page 42 of this management proxy circular for specifics of the compensation provided to Messrs. George and Williams for the year ended December 31, 2011.
(2): Share-based awards consist of DSUs, which are granted annually and administered quarterly. Grant date fair market value is based on the average of the day's high and low price of a Suncor common share on the TSX for the trading day immediately preceding the date of each quarterly award ($43.20, $37.44, $27.31, $28.89). DSUs cannot be redeemed by non-employee directors until they cease to hold office.
(3): Suncor does not provide stock options, pension benefits, non-equity incentives or other compensation to Board members.
(4): Mr. Canfield retired as a member of the Board, Audit Committee and EHS&SD Committee effective as of May 3, 2011.

16 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Fees Paid. The following table provides a detailed breakdown of the fees paid to our non-employee directors for the year ended December 31, 2011. Fees are paid quarterly.

($)

Name	Retainer Fee	Committee Retainer Fee	Committee Chair Retainer Fee	Board Attendance Fee	Committee Attendance Fee	Travel Fees	Total Fees Paid ⁽¹⁾	Fees Taken in DSUs	Fees Taken in Cash


Mel E. Benson	50 000	5 000	10 000	10 500	15 000	1 500	92 000	—	92 000
Brian A. Canfield ⁽²⁾	25 000	2 500	12 500	4 500	7 500	3 000	55 000	55 000	—
Dominic D'Alessandro	50 000	11 000	—	10 500	18 000	4 500	94 000	94 000	—
John T. Ferguson	250 000	—	—	—	—	6 000	256 000	128 000	128 000
W. Douglas Ford	50 000	10 000	—	10 500	16 500	6 000	93 000	93 000	—
Paul Haseldonckx	50 000	11 000	—	10 500	16 500	12 000	100 000	—	100 000
John R. Huff	50 000	10 000	—	10 500	15 000	6 000	91 500	91 500	—
Jacques Lamarre	50 000	10 000	—	10 500	15 000	6 000	91 500	91 500	—
Brian F. MacNeill	50 000	6 000	10 000	10 500	18 000	1 500	96 000	—	96 000
Maureen McCaw	50 000	10 000	—	10 500	15 000	6 000	91 500	91 500	—
Michael W. O'Brien	50 000	8 000	17 250	10 500	18 000	1 500	105 250	—	105 250
James W. Simpson	50 000	5 000	15 000	10 500	16 500	1 500	98 500	49 250	49 250
Eira M. Thomas	50 000	11 000	—	10 500	18 000	6 000	95 500	47 750	47 750

Total	825 000	99 500	64 750	120 000	189 000	61 500	1 359 750	741 500	618 250

(1): Amounts reflect aggregate value of fees paid in cash and/or DSUs.
(2): Mr. Canfield retired as a member of the Board, Audit Committee and EHS&SD Committee effective May 3, 2011.

EQUITY-BASED COMPENSATION

Annual DSU Grant. Non-employee directors participate in the Suncor Deferred Share Unit Plan (previously defined as the "DSU Plan"). When redeemed, each DSU pays the holder the then-current cash equivalent of the market price per share, as calculated in accordance with the DSU Plan. DSUs provide a stake in Suncor and promote greater alignment between directors and shareholders.

Under the DSU Plan, each non-employee director receives an annual DSU grant as part of their total compensation. The annual grant of DSUs is awarded in equal quarterly installments. In 2011, non-employee directors, including the chairman of the Board, received an aggregate of 61,400 DSUs. Each non-employee director, other than the chairman, received 4,800 DSUs. The chairman of the Board received 7,400 DSUs.

For each new non-employee director, the DSU Plan provides for an additional grant equal to the annual grant for the year in which they are appointed to the Board. New non-employee directors, including a new chairman of the Board, who join after February of a calendar year, will receive a pro-rated annual DSU grant based on the date they join the Board.

Fees Paid in DSUs. Until the share ownership guidelines for non-employee directors are met (see page 16 of this management proxy circular for details), non-employee directors receive one-half or, if they choose, all of their fees (excluding expense reimbursements) in the form of DSUs. The number of DSUs to be credited to the non-employee director's account on each payment date is equal to the number of common shares that could have been purchased on the quarterly payment date based on the fees allocated to the director. On each dividend payment date for common shares, an additional number of DSUs, equivalent to the number of common shares that could have been acquired on that date by notional dividend reinvestment, are credited to the non-employee directors' DSU accounts.

Redemption of DSUs. DSUs will be redeemed when a non-employee director ceases to hold office, or on a date elected by that director prior to November 30 of the following calendar year. For directors subject to payment of U.S. federal tax, the redemption period to elect payout of DSUs commences on the first day of the calendar year following that year in which the non-employee director ceases to be a member of the Board, and ends on November 30 of that same year. However, no redemption will be permitted within the first six months following separation from service by a U.S. taxpayer who is considered a "specified employee". The cash payment at redemption is calculated by multiplying the number of DSUs by the then-current market value of a common share.

Stock Options. In accordance with best practice guidelines, stock option grants to non-employee directors were discontinued after 2008. No future stock option grants to non-employee directors are planned.

Director Equity Compensation Hedging. Pursuant to Suncor's policies, directors are not permitted to engage in short selling in Suncor common shares or purchase financial instruments (including, for greater certainty, puts, options, calls, prepaid variable forward contracts, equity swaps, collars or units of exchange funds) that are designed to hedge or offset a change in the market value of common shares or other securities of Suncor held by the director.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 17

Option-Based and Share-Based Awards. The following table provides certain information about option-based and share-based awards outstanding for our non-employee directors as at December 31, 2011. For further details, including the exercise price and expiration date, of each option-based award held by our non-employee directors as at December 31, 2011, see Schedule A.

	Option-Based Awards		Share-Based Awards
Name	Aggregate number of securities underlying unexercised options	Aggregate value of unexercised 'in-the-money' options ⁽¹⁾ ($)	Aggregate market or payout value of vested share-based awards not paid out or distributed ⁽²⁾ ($)


Mel E. Benson	16 000	—	1 387 647
Dominic D'Alessandro	—	—	660 551
John T. Ferguson	68 000	672 400	2 295 283
W. Douglas Ford	40 000	256 960	1 668 725
Paul Haseldonckx	—	—	615 012
John R. Huff	64 000	672 400	2 357 451
Jacques Lamarre	—	—	655 086
Brian F. MacNeill	—	—	2 728 051
Maureen McCaw	—	—	964 957
Michael W. O'Brien	48 000	427 440	1 299 066
James W. Simpson	—	—	843 000
Eira M. Thomas	24 000	—	1 109 359

Total	260 000	2 029 200	16 584 188

(1): The value of options reflects the 'in-the-money' amount (the difference between the closing price on the TSX of a Suncor common share on December 31, 2011 ($29.38) and the exercise price of the option) of the exercisable and non-exercisable options.
(2): Includes DSUs issued under the DSU Plan and closed PCCDSU Plan. For Messrs. Haseldonckx and MacNeill, includes RSUs issued under the closed PCRSU Plan. All share-based awards held by non-employee directors have vested but cannot be redeemed until they cease to hold office. Calculated based on the closing price on the TSX of a Suncor common share on December 31, 2011 ($29.38).

Share-Based Awards – Value Vested or Earned During the Year. The following table provides the value vested in relation to share-based awards held by our non-employee directors during the year ended December 31, 2011. No option held by a non-employee director that vested during 2011 was 'in-the-money' based on the difference between the exercise price of the option and the closing price of a Suncor common share on the day of vesting.

Name		Share-based awards – Value vested during the year ⁽¹⁾ ($)


Mel E. Benson		164 208
Brian A. Canfield		51 840
Dominic D'Alessandro		164 208
John T. Ferguson		253 154
W. Douglas Ford		164 208
Paul Haseldonckx		164 208
John R. Huff		164 208
Jacques Lamarre		164 208
Brian F. MacNeill		164 208
Maureen McCaw		164 208
Michael W. O'Brien		164 208
James W. Simpson		164 208
Eira M. Thomas		164 208

Total		2 111 336

(1): Includes DSUs issued under the DSU Plan, which are granted annually and administered quarterly. Grant date fair market value is based on the average of the day's high and low price of a Suncor common share on the TSX for the trading day immediately preceding the date of each quarterly award ($43.20, $37.44, $27.31, $28.89).

18 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Director Value at Risk. The following table provides the aggregate equity holdings of our non-employee directors for the years ended December 31, 2010 and 2011 as well as the net change during 2011 and the total value at risk as at December 31, 2011.

	December 31, 2010			December 31, 2011			Net Change During 2011
	Shares	Share- based awards ⁽¹⁾	Options	Shares	Share- based awards ⁽¹⁾	Options	Shares		Share- based awards ⁽¹⁾	Options		Total value at risk ⁽²⁾⁽³⁾ ($)


Mel E. Benson	17 548	41 842	16 000	17 548	47 231	16 000	—		5 389	—		1 903 207
Brian A. Canfield	30 020	72 236	80 000	46 020	75 797	64 000	16 000		3 561	16 000		4 251 383
Dominic D'Alessandro	10 000	14 612	—	10 000	22 483	—	—		7 871	—		954 351
John T. Ferguson	49 483	65 903	84 000	50 298	78 124	68 000	815		12 221	(16 000	)	4 445 438
W. Douglas Ford	—	48 500	40 000	—	56 798	40 000	—		8 298	—		1 925 685
Paul Haseldonckx	12 060	15 895	—	12 103	16 883	—	43		988	—		970 598
John R. Huff	43 018	71 666	80 000	43 058	80 240	64 000	40		8 574	(16 000	)	4 294 895
Jacques Lamarre	6 280	14 490	—	11 280	22 297	—	5 000		7 807	—		986 492
Brian F. MacNeill	13 056	86 881	—	13 056	92 854	—	—		5 973	—		3 111 636
Maureen McCaw	7 693	24 901	—	7 750	32 844	—	57		7 943	—		1 192 652
Michael W. O'Brien	51 808	38 868	48 000	26 808	44 216	48 000	(25 000	)	5 348	—		2 514 125
James W. Simpson	4 736	22 047	—	4 736	28 693	—	—		6 646	—		982 144
Eira M. Thomas	4 000	31 064	24 000	4 000	37 759	24 000	—		6 695	—		1 226 879

(1): Includes DSUs issued under the DSU Plan and closed PCCDSU Plan and in the case of Messrs. Haseldonckx and MacNeill, RSUs issued under the closed PCRSU Plan.
(2): Value of shares, DSUs and RSUs is calculated based on the closing price on the TSX of a Suncor common share on December 31, 2011 ($29.38).
(3): Value of options reported reflects the 'in-the-money' amount (the difference between the closing price on the TSX of a Suncor common share on December 31, 2011 ($29.38) and the exercise price of the option) of the exercisable and non-exercisable options held as at December 31, 2011.

Looking Ahead to 2012

In 2011, the Governance Committee reviewed non-employee director compensation market data provided by Towers Watson for the Suncor Compensation Peers and determined that no changes to the compensation structure for directors would be made for 2012.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 19

EXECUTIVE COMPENSATION
LETTER TO SHAREHOLDERS

To Our Fellow Shareholders:

As the chairman of the board of directors (the "Board") of Suncor Energy Inc. ("Suncor") and the chair of the Human Resources and Compensation Committee (the "HR&CC"), we would like to take this opportunity to communicate with you about governance and management of executive compensation at Suncor.

Your Board oversees the overall strategic direction and policy framework for Suncor. This important responsibility includes the compensation of our senior executives, with the assistance of the HR&CC.

Through the Compensation Discussion and Analysis (the "CD&A") section that is provided in Suncor's 2012 management proxy circular, our goal is to provide shareholders with information to understand Suncor's compensation philosophy, our approach to senior executive compensation, what our named executive officers ("NEOs") are paid and how their level of compensation is determined.

The information that follows provides an overview of how senior executive compensation aligns with shareholder value, our compensation framework, actions we have taken in 2011 to continue to enhance our compensation governance practices, the performance and compensation of the Chief Executive Officer ("CEO") for 2011 as determined by the Board and how the Board is approaching compensation for the President and Chief Operating Officer, as he transitions to become the CEO following the annual general meeting in May.

Alignment of Senior Executive Compensation with Strategic Goals and Shareholder Value

Suncor is committed to delivering long-term shareholder value. This commitment is reflected in an integrated business model, which takes advantage of a strong resource position, an extensive range of complementary assets in both the upstream and downstream, reliable operations and an excellent suite of growth projects.

Through 2011, our focus on operational excellence has led to improved reliability and record oil sands production, enabling demonstrated progress in building sustained shareholder value, with record operating earnings, cash flow and a stronger balance sheet. As we move into 2012, the second year of our ten year growth plan that is expected to boost total production to more than one million barrels of oil equivalent per day by 2020, we will continue to focus on operational excellence to drive safe, environmentally responsible and reliable operations, and the delivery of our growth goals through effective, cost efficient execution of our capital projects.

Suncor's senior executive compensation policies and programs are designed to support and reinforce our goals of safe, reliable operations; environmentally and socially responsible practices; and profitable growth strategies.

Recognizing the context within which Suncor operates, our senior executives are provided with a mix of fixed and variable, performance based compensation targeted at the median of a group of North American energy company peers. The variable, performance based components of the senior executives' total direct compensation represent a high proportion (over 80% for the CEO), and are spread over the short-, medium- and long-term.

This design provides the opportunity to increase compensation when above-target business results are achieved while limiting compensation when performance warrants. We believe this pay-for-performance approach with varying performance periods and significant variable, performance based compensation for senior executives responds to shareholder expectations of a strong link between senior executive pay and long-term value creation, providing appropriate incentives to reward strong performance without encouraging undue risk taking.

We believe limiting or increasing actual incentive compensation realized in line with long-term value creation is demonstrated in the CD&A, in regard to the total direct compensation of our NEOs.

Over the period of 2007 to 2011, the total direct compensation of the NEOs was approximately 33% lower than the expected value reported in the summary compensation table over the same period. This result generally aligns with share price performance over this period, and reflects the strong weighting to mid- to long-term incentives in the total direct compensation of the NEOs. While the NEOs have realized increasing short-term incentive compensation from improving operational performance, the value of mid- to long-term incentive compensation is well below the disclosed expected value in the summary compensation table and is in line with Suncor's share price performance and total shareholder return.

20 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Compensation Framework

The HR&CC, comprised of non-employee directors and led by Mr. Simpson, accesses advice from Towers Watson and Meridian Compensation Partners on design, testing and implementation of senior executive compensation programs, emerging trends and best practices for large energy and large general industry companies in North America. The HR&CC has worked to establish an effective compensation framework with the key goals of attracting and retaining talented senior executives and aligning management closely with goals of sustained long-term performance.

This compensation structure balances providing the incentive to achieve both short- and long-term objectives through fixed base salary to reflect the value of a role in the market, a short-term incentive award opportunity based on in year performance versus business goals and mid- and long-term incentives that reward senior executives for both absolute shareholder return and shareholder return relative to our North American energy peers. In this way, a substantive portion of actual compensation is directly tied to our shareholder's experience.

As described in the CD&A, a key responsibility of the Board and the HR&CC is to ensure our senior executive compensation programs and policies are aligned with shareholder interests and appropriately limit compensation risks. At Suncor, this is accomplished through the combination of governance practices applied by the Board and the HR&CC, the design of senior executive programs and practices to include thresholds, cap maximums, performance hurdles, meaningful share ownership requirements and the systems, processes, authorities and controls inherent to the business.

Enhancing Compensation Governance Practices

The Board and the HR&CC Committee carefully oversee governance practices for executive compensation. The HR&CC Committee receives support from external advisors and works closely with management to identify and make changes that ensure Suncor's executive compensation philosophy and programs are effective and appropriately incorporate new trends.

In 2011, a number of improvements were introduced, including the HR&CC undertaking a comprehensive compensation risk assessment. We believe our compensation system does not encourage excessive risk taking. More information on the compensation risk assessment and on other improvements made in 2011 is provided in the CD&A.

In 2012, the HR&CC will work with the Governance Committee to develop and recommend approval by the Board of a claw back policy. This will expand on the current requirement for claw back of CEO and Chief Financial Officer annual incentive bonuses if there is an accounting restatement as a result of misconduct.

2011 CEO Performance and Compensation

The Board evaluated the CEO's performance as exceptional for the past year. His total direct compensation for fiscal 2011 was $13.7 million. This is up from 2010, when his total direct compensation was $9.6 million. The increase reflects Suncor's strong 2011 business results, the almost 15% increase in the market target value at the median of Suncor's North American energy peers for the mid- to long-term incentive component of Rick George's total direct compensation and the Board's evaluation of the CEO's performance measured against his personal goals for 2011.

With more than 65% of the CEO's 2011 total direct compensation provided in the form of mid- to long-term incentives and over 80% of the increase in total direct compensation versus 2010 in the form of mid- to long-term incentives, a substantial portion of the CEO's 2011 compensation is directly tied to an increase in shareholder value.

The Board believes that under the CEO's leadership, the company is positioned to leverage its fully integrated business model and is demonstrating results that will support building long-term shareholder value.

Further information on the 2011 compensation of the CEO and the other NEOs can be found beginning on page 23 of our 2012 management proxy circular.

Compensation Approach for the New President & CEO

Mr. George will retire from Suncor following the annual general meeting. He has been an outstanding CEO for Suncor during his 21 year tenure, leading the creation of significant value to shareholders over his time as CEO and positioning Suncor for long-term, profitable growth going forward.

Through our succession planning process, the Board has implemented a smooth transition from Mr. George to Steve Williams, who will become President and CEO in May.

The HR&CC, working with the Board, has aligned the compensation for Mr. Williams in 2012 with his transition to CEO. Mr. Williams will receive increases in his base salary, annual incentive target and mid- to long-term incentives during 2012 in line with his appointment. These compensation changes will position him, as a new CEO, at the appropriate level, consistent with and typical of an internal promotion, compared to the median level of total direct compensation for Suncor's North American energy peers.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 21

Closing

Your Board, with the support of the HR&CC, is committed to ensuring that Suncor's senior executive compensation is aligned with shareholder interests and enables Suncor's long-term competitiveness.

We believe the compensation structure in place for Suncor senior executives fits our industry, and is appropriately linked to our strategy to build long-term shareholder value. We have always welcomed shareholder feedback on Suncor's business operations, policies and practices including executive compensation and we welcome your feedback.

Sincerely,


James Simpson Chair of the Human Resources & Compensation Committee		John Ferguson Chairman of the Board

22 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

COMPENSATION DISCUSSION AND ANALYSIS

2011 NAMED EXECUTIVE OFFICERS

The persons (the "NEOs" or "Named Executive Officers") who are the focus of the CD&A and who appear in the compensation tables are:

RICHARD L. GEORGE	R.L. GEORGE	CHIEF EXECUTIVE OFFICER ⁽¹⁾
BART W. DEMOSKY	B.W. DEMOSKY	CHIEF FINANCIAL OFFICER ⁽²⁾
STEVEN W. WILLIAMS	S.W. WILLIAMS	PRESIDENT & CHIEF OPERATING OFFICER ⁽¹⁾
BORIS J. JACKMAN	B.J. JACKMAN	EXECUTIVE VICE PRESIDENT, REFINING & MARKETING
MARK S. LITTLE	M.S. LITTLE	EXECUTIVE VICE PRESIDENT, OIL SANDS & IN SITU ⁽³⁾

(1): Effective December 1, 2011, Mr. George retired from the position of President and Mr. Williams was appointed as President.
(2): For purposes of the Suncor executive compensation structure, Chief Financial Officer is currently equivalent to the Senior Vice President level.
(3): Effective January 1, 2012, Mr. Little was appointed to Executive Vice President, Oil Sands and In Situ. In 2011, Mr. Little was Executive Vice President, Oil Sands from January 31, 2011 and Senior Vice President, International & Offshore prior to that date.

CD&A HIGHLIGHTS

Evolving disclosure requirements and stakeholder expectations in recent years, focused on transparency and good governance, have resulted in more information being included in management proxy circulars.

This year, we have included a summary of some key information found within the CD&A. The intent of this summary is to provide a quick reference, highlighting some of the points covered in the CD&A. We hope you will find the summary helpful.

Compensation Governance

Risk Management. Increased disclosure has been provided on managing compensation risk, including oversight procedures and risk mitigating features of our compensation policies and programs. In 2011, the HR&CC, with assistance from Towers Watson, assessed Suncor's compensation policies and programs to determine whether any components could encourage unacceptable risk taking. The HR&CC's assessment concluded that the compensation policies and programs did not encourage risk that is reasonably likely to have a material adverse effect on Suncor. This is consistent with the risk assessment completed by Towers Watson. More information is provided beginning on page 26 of this management proxy circular.

Claw Back Policy. The Board is committed to the principles of claw back, or recovery of compensation, in the event the financial information on which the compensation awards were based is materially restated. The Board, working through the HR&CC and Governance Committee, will conduct a review of market practice and evolving regulatory requirements with the intent of adopting a claw back policy for Suncor during 2012.

Compensation of the Named Executive Officers

Compensation Decision Process. The compensation structure for Suncor's executives is determined and approved by the HR&CC using market data based on the Suncor Compensation Peers and information on executive compensation trends provided by the company's external compensation advisors. The 2011 compensation of the NEOs, other than the CEO and President and COO, was recommended by the CEO and President and COO and reviewed by the HR&CC. The compensation for the CEO and for the President and COO was recommended by the HR&CC to the independent members of the Board for approval.

2011 Total Direct Compensation. Total direct compensation (consisting of base salary, annual incentive and mid- to long-term incentive components) is benchmarked against the median total direct compensation for the Suncor Compensation Peers. More information on the Suncor Compensation Peers can be found beginning on page 29 of this management proxy circular.

Base Salaries. Increases in base salary reflect market competitiveness, economic conditions and demonstrated capability. The base salaries for the CEO, CFO and President and COO were increased in 2011 to maintain their salaries near the competitive median for their executive level in comparison to the Suncor Compensation Peers. The Executive Vice President ("EVP"), Oil Sands, received an increase in base salary in connection with his promotion to EVP in January 2011. The EVP, Refining and Marketing, did not receive an increase, as his salary is at the top of the Suncor Compensation Peer's competitive salary range for his level.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 23

Annual Incentive. Suncor's annual incentive plan ("AIP") rewards Corporate, Business Unit and Personal performance and has component weightings at target of 20%, 60% and 20% respectively. There is a maximum payout of 220% of target and a performance threshold trigger that must be achieved before any payouts can be made under the plan.

The overall performance level for the Corporate component of the AIP (cash flow from operations) and Business Unit component of the AIP (personal and process safety, environment, reliability and people) exceeded targets for 2011, which, combined with the Personal component of the AIP (performance against personal goals) for the NEOs, resulted in above target AIP payouts for 2011 for the NEOs that ranged from 155% to 177% of the maximum 220% annual incentive opportunity under the AIP. Information on Corporate and Business Unit performance under the AIP is provided on page 32 of this management proxy circular. Details on the AIP payout calculations for each of the NEOs begin on page 34 of this management proxy circular.

Mid- to Long-Term Incentives. Equity awards consisting of stock options and PSUs that are provided to NEOs, form a significant part (a minimum of 50% to almost 70% for the CEO) of their competitive target total direct compensation. The target value for the equity awards for the NEOs is based on the median value for the Suncor Compensation Peers. This variable, performance based, mid- to long-term incentive pay component of total direct compensation is intended to reward performance in relation to increases in share price and achievement of performance thresholds. Alignment of this design for the mid- to long-term incentives with shareholder interests is directly reflected in the realized or actual value of the equity awards made to the NEOs for the period of 2007-2011, which, at December 31, 2011, was 53% below the disclosed expected value at the time of the award.

Equity awards are granted to the NEOs early in the year. The equity award values displayed in the summary compensation table beginning on page 42 of this management proxy circular for 2011, are based on awards approved for the NEOs. The equity awards reflect increases in the competitive target value of these awards at the median of the Suncor Compensation Peers for 2011 ranging from 7% to 14%, the performance of the NEOs, consideration of prior awards and retention, and in the case of the EVP, Oil Sands, his promotion to EVP.

Information on company and individual 2011 performance highlights, base salary increases, AIP payouts and mid- to long-term incentive awards for the NEOs begins on page 31 of this management proxy circular.

Supplemental Executive Retirement Plan

The NEOs, other than the EVP, Refining and Marketing, participate in a Supplemental Executive Retirement Plan ("SERP"). The EVP, Refining and Marketing, continues in a closed former Petro-Canada retirement plan. The SERP is a key tool used to attract mid-career senior executives.

The Board approved amendments to the SERP effective January 1, 2012, that prescribe new limits for the total pension of a senior executive participant in the SERP as a percent of remuneration and the maximum executive remuneration that can be used in determining the pension for a senior executive participant. Details on the SERP are provided on page 44 of this management proxy circular. Details on the closed former Petro-Canada retirement plan are provided on page 45 of this management proxy circular.

Termination Agreements and Change of Control Arrangements

Termination Agreements. Suncor has termination agreements with each of the NEOs to compensate them based on their remuneration in the event of the termination of their employment. Since 2008, Suncor's termination agreements with new senior executive participants have provided for a notice period of 24 months. With the retirement of the current CEO following the annual general meeting in May, and with the appointment of the COO to President in December 2011, the notice period for all senior executive termination agreements is 24 months.

During 2011, termination agreements for new executives were also amended to provide for, in the event of termination of employment, the pro-rating of the payout value of PSUs and RSUs held based on the length of service within the performance period.

Change of Control Arrangements. Termination agreements with the NEOs are "double trigger" and don't provide payment based on voluntary termination of employment in a change of control.

Stock options, PSUs and RSUs held by a participant that were granted prior to 2012, other than those held by the EVP, Refining and Marketing, under legacy Petro-Canada plans, immediately vest under a change of control. In 2012, the SOP, PSU Plan and RSU Plan were amended to provide that grants made after January 1, 2012, would be "double trigger" under a change of control.

Information on NEO termination agreements and change of control arrangements begins on page 46 of this management proxy circular.

24 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

COMPENSATION PHILOSOPHY

Our executive compensation policies and programs support Suncor's strategic growth and operational excellence goals, which are focused on increasing shareholder value through reliable operations, sustained performance, safety and environmental excellence and profitable growth.

Our philosophy is to compensate executives:

•: based on performance achieved, measured against challenging but fair goals;
•: competitively with the Suncor Compensation Peers; and
•: with a mix of fixed and variable, performance based compensation that enables Suncor to attract, engage and retain talented executives who have the capability to effectively manage Suncor's operations, assets and financial results in order to build and sustain long-term shareholder value.

Our compensation programs are competitive, designed around pay-for-performance objectives and are responsive to market changes. Actual rewards under short-, mid- and long-term programs are directly linked to Suncor's business results and increased shareholder value.

COMPENSATION GOVERNANCE

Board of Directors

The Board oversees development of the overall strategic direction and policy framework for Suncor. This responsibility, in part, is discharged with the assistance of Board committees, including the HR&CC. Further details relating to Board committees can be found in Schedule C attached to this management proxy circular.

Human Resources & Compensation Committee

Central to the role of the HR&CC is the alignment of executive compensation with the delivery of shareholder value. The capabilities, powers and operation of the HR&CC include assisting the Board annually by:

•: reviewing and approving the overall corporate goals and objectives of Suncor relevant to compensation of the CEO, and ensuring that the overall goals and objectives of Suncor are supported by an appropriate executive compensation philosophy and programs;
•: evaluating the performance of the CEO against approved goals and criteria, and recommending to the Board the total compensation for the CEO in light of the evaluation of the CEO's performance;
•: reviewing in-depth the CEO's and President's evaluation of the other senior executives' performance and recommendations for total compensation of these senior executives;
•: reviewing the succession planning process and results for senior executives;
•: reviewing, on a summary basis, any significant compensation, pension and benefit programs for employees generally, with consideration of accounting, tax, design, legal, regulatory and risk implications and the pay-for-performance relationship for variable pay; and
•: reviewing executive compensation disclosure and recommending it to the Board for approval before Suncor publicly discloses this information.

All HR&CC members are independent directors. The HR&CC is currently comprised of the following members: James W. Simpson (chair), Mel E. Benson, W. Douglas Ford, John R. Huff, Jacques Lamarre and Maureen McCaw.

The HR&CC members have experience in top leadership roles (four of six in CEO roles), strong knowledge of the energy industry (four of six with an energy industry background), a mix of functional experience and competency from operations and strategy to construction and professional services, as well as tenure as directors of various public companies. This background provides the HR&CC with the collective experience, skills and qualities to effectively support the Board in carrying out their mandate. Further information on the HR&CC committee member experience and skills is provided in the inventory of Board member capabilities and competencies on page 10 of Schedule C attached to this management proxy circular.

Executive Compensation Consultants

The HR&CC retains Towers Watson and Meridian Compensation Partners ("Meridian") to provide executive compensation advice to help discharge its mandate. Towers Watson was originally retained in February 2006 and Meridian was originally retained in February 2010.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 25

Towers Watson provides advice to the HR&CC, supports management in the area of executive compensation and provides services in other human resources areas, including pensions. Towers Watson has protocols in place to ensure that they are in a position to provide independent advice.

The HR&CC receives consulting support and information from Towers Watson in the following areas:

•: expertise and advice in the development of compensation policies and programs for executives;
•: periodic updates on best practices, trends and emerging regulatory or governance matters related to executive compensation;
•: custom survey work benchmarking Suncor compensation in the marketplace; and
•: support in conducting a risk assessment of Suncor's compensation policies and programs.

Meridian's role is to review and provide advice on recommendations and work put forward by management and Towers Watson. In its role as advisor, Meridian:

•: provides compensation advice and perspective to the HR&CC;
•: validates or challenges proposals, recommendations and the decision process followed; and
•: helps develop proposals and information for the HR&CC as needed.

The decisions made by the HR&CC may reflect factors and considerations other than the information provided or recommendations made by our compensation consultants. During 2011, Towers Watson and Meridian met with the HR&CC chair and attended relevant sections of HR&CC meetings, as necessary.

Executive Compensation-Related Fees

Executive compensation-related fees paid by Suncor in 2010 and 2011 to Towers Watson and to Meridian are displayed in the table below.

Executive Compensation Consultant	Fees Paid related to 2010 ($)	Fees Paid related to 2011 ($)


Towers Watson	102 233	234 544
Meridian	24 390	31 774

All Other Fees

In addition to the fees disclosed above, Towers Watson assisted in certain matters related to pension and benefits, including, but not limited to, actuarial and accounting services. Total fees payable to Towers Watson for the foregoing services were $1 158 552 in 2010 and $1 159 223 in 2011, which included all fees payable to Towers Watson by Suncor not included under executive compensation-related fees in 2010 and 2011 respectively. Other than the fees disclosed above, no other fees were paid by Suncor to Meridian in 2010 and 2011.

The HR&CC pre-approves all material executive compensation-related fees paid to Towers Watson or Meridian. The Board does not pre-approve services provided by Towers Watson that do not relate to executive compensation-related services.

Managing Compensation Risk

Suncor's executive compensation policies and programs are designed to create appropriate incentives to increase long-term shareholder value. While the energy business by its nature requires some level of risk-taking to achieve returns in line with shareholder expectations, Suncor has designs and structures within our policies and programs to limit risk.

Nature of Our Business

When considering the potential risks facing Suncor, it is important to recognize that our business has intrinsic risks, and that many of the factors that influence the organization's performance (e.g., commodity prices and foreign exchange) are outside of the direct control of management and therefore are not subject to potential manipulation for financial gain. Given the oversight procedures and the key risk mitigation features of Suncor's compensation policies and programs described below, Suncor believes that it would be difficult for anyone in management acting alone, or acting as a group, to make "self-interested" decisions for immediate short-term gains that could have a material impact on the organization's financial or share price performance.

26 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Oversight Procedures

•: Suncor's strategic multi-year plan approved by the Board is believed to balance investment risk and reward, and assesses company and industry risks in advance to support planning, risk management and decision-making.
•: As part of its governance, the Board has also overseen the development by management of Suncor's Enterprise Risk Management Program ("ERMP"). ERMP includes an entity-wide approach to risk identification, assessment, monitoring and management. In addition, the Audit Committee oversaw Suncor's adoption of a Trading Risk Management Policy. See page 3 of Schedule C to this management proxy circular.
•: In the normal course of business, Suncor has financial controls that provide limits and authorities in areas such as capital and operating expenditures, divestiture decisions and marketing and trading transactions. These financial controls mitigate inappropriate risk-taking that could affect compensation.
•: During 2011, the HR&CC engaged Towers Watson to assist in developing and implementing a compensation risk framework (the "Risk Framework") for Suncor. The Risk Framework was designed to assist the HR&CC in assessing Suncor's compensation policies and programs to determine whether any components could encourage unacceptable excessive risk taking. In connection with the development of the Risk Framework, Towers Watson met with members of the Board and senior management to understand Suncor's risk culture and risk profile, and the interaction between material risks and compensation policies and programs. Towers Watson also reviewed documentation from the ERMP and all compensation plans. Going forward, the HR&CC will review the Risk Framework on an annual basis to take account of any significant shifts in Suncor's business strategies or compensation policies and programs and adjust the framework as appropriate.

Key Mitigating Features

•: Total direct compensation for executives provides an appropriate balance between base salary and variable, performance based compensation. For our Named Executive Officers, emphasis is not focused on one compensation component, but is spread across short-, mid- and long-term programs to support and balance sustained short-term performance and long-term profitable growth.
•: Suncor's total compensation for executives is regularly benchmarked against a peer group of companies of similar size and scope as approved by the HR&CC. This ensures that compensation is competitive with peers and aligned with Suncor's philosophy.
•: For our NEOs, typically 70% or more of their target total direct compensation is variable based on company, business unit and individual performance and the remaining 30% or less is base salary. Of the 70% or more of variable compensation, approximately 75% or more is mid- and long-term focused and 25% or less is short-term. The weighting towards mid- to long-term compensation mitigates the risk of too much emphasis on short-term goals at the expense of long-term sustainable performance. More information on the pay mix for executives is provided on page 30 of this management proxy circular.
•: Short-term incentive pay is earned through a balanced, diversified mix of performance measures. The performance measures include financial and operational goals. The goals, results and payouts are reviewed and stress-tested by the HR&CC. This balanced approach discourages the unintended consequence of encouraging a singular focus at the expense of other key factors (e.g., profitable growth versus safety).
•: The AIP for all salaried employees is inherently designed to limit risk. The funds available to provide annual cash payouts under the AIP are determined based on a scorecard for each business unit with consistent measurement across areas critical to Suncor's success. The performance measurement areas are personal and process safety, environment, reliability and people. A threshold for payouts under the plan is established each year based on a minimum cash flow level requirement. Payouts under the plan are capped at 220% of target. The use of a number of key performance measurement areas and the threshold for payouts under the AIP diversifies the risk under any one performance area.
•: Under the DSU Plan, executives may elect annually to allocate 50% or 100% of their AIP payment to DSUs. This feature in the DSU Plan can be used by executives to assist in meeting share ownership requirements and defers annual incentive compensation, further encouraging a focus on long-term performance.
•: Our mid-term Performance Share Unit ("PSU") Plan rewards relative total shareholder return ("TSR") performance over three years versus our PSU peer group of companies, as described on page 48 of this management proxy circular. The three year performance period deters short-term focused decision making. There is no payout if relative TSR performance is in the bottom quartile, with a cap of 200% of target for relative TSR performance at the very top of the peer group and a sliding scale in between.
•: Stock options vest over three years and have a seven year term, reinforcing the goal of building and sustaining long-term value in line with shareholder interests.
•: PSUs and stock options are granted annually, thereby providing overlapping performance cycles that require sustained high levels of performance to achieve a consistent payout.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 27

•: Suncor executives must achieve and maintain specific share ownership levels based on a multiple of their annual salary. A substantial ownership level in the company assists in aligning executive interests with those of shareholders. The share ownership guidelines for executive officers are found on page 29 of this management proxy circular and range from 2 × salary for senior vice presidents to 5 × salary for the CEO. In addition, there is a further requirement for the CEO to maintain his share ownership requirement level through the first year following retirement.
•: The HR&CC and the Board provide strong oversight of the management of Suncor's compensation programs. The HR&CC has discretion in assessing performance under executive compensation programs to adjust metrics or the payouts based on results and events, and have used the discretion to lower payouts under certain programs in the past.

Conclusion

The assessment completed by the HR&CC in 2011 pursuant to the Risk Framework concluded that Suncor's compensation policies and programs do not encourage excessive risk that is reasonably likely to have a material adverse effect on Suncor. The conclusion is consistent with the assessment completed by Towers Watson.

After completing the assessment under the Risk Framework, the HR&CC recommended development of a broader claw back policy for Suncor in 2012. Suncor's CEO and CFO are currently subject to a claw back of their annual incentive bonus if there is an accounting restatement as a result of misconduct.

Executive Equity Compensation Hedging

Pursuant to Suncor's policies, executives are not permitted to engage in short selling in shares or purchase financial instruments (including, for greater certainty, puts, options, calls, prepaid variable formal contracts, equity swaps, collars or units of exchange funds) that are designed to hedge or offset a change in the market value of common shares or other securities held by an executive.

Looking Ahead to 2012

As noted above, Suncor's CEO and CFO are currently subject to a claw back of their annual incentive bonus if there is an accounting restatement as a result of misconduct. The Board is committed to the principles of claw back (which generally provide for the recovery of compensation in the event the financial information on which compensation awards were based is materially restated) to help manage the potential risk of paying for performance, in the event that previously rewarded performance was not in fact delivered.

The Board recognizes the complexities in regard to the design and application of a claw back policy. As such, the Board, working through the HR&CC and Governance Committee, will conduct a review with the intent of adopting a claw back policy during 2012. The review will take into account current practices of other issuers, evolving regulatory and legal requirements, shareholder advisory group information and other key considerations in determining the approach and method to adopting a claw back policy.

OUR APPROACH TO EXECUTIVE COMPENSATION

Pay-for-Performance Philosophy. Suncor maintains a strong pay-for-performance philosophy. Compensation plans and practices are tied to our strategic business objectives. Our philosophy is demonstrated in the mix of compensation provided and the way we measure success. A significant portion of the total compensation of our senior executives is provided in variable, performance based pay, designed to reward superior business performance and increasing shareholder returns. This is a fundamental part of who we are as an organization. For senior executives, incentive-based pay is designed to reward successful short-, medium- and long-term performance in key performance areas such as safety, environment, operating reliability, cash flow and shareholder return, all of which enable the performance results and returns that are important to our shareholders.

Finding The Right Balance. To deliver sustained and profitable long-term performance, it is essential that we attract, engage and retain talented, capable executives who can execute on current priorities and help position Suncor over the long-term for sustained success. To do this, we design our programs to provide an attractive and competitive total compensation opportunity. We believe we provide the right balance through " total direct compensation ", consisting of salary, annual incentive and mid- and long-term equity-based incentives, and "indirect compensation", consisting of benefits and retirement-related programs. These programs are complimented with excellent career development opportunities and careful succession planning.

Defining Our Marketplace. Suncor's size and business scope are key criteria to defining the marketplace used to establish competitive compensation levels for our senior executives. Suncor is the largest energy company in Canada and one of the largest energy companies in North America by market capitalization.

28 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

The peer group defined by the HR&CC to benchmark executive compensation levels for Suncor's top 13 executives in 2011, including the NEOs identified on page 23 of this management proxy circular, is energy sector specific, comprised of organizations that are similar to Suncor in terms of scope and complexity and what we believe represent our market for executive talent. Our peer group is comprised of 19 North American based energy companies. In Canada, we include pipeline companies, since there are fewer comparable upstream and integrated energy companies and because pipeline companies form part of our labour market. In the U.S., where there are more large upstream and integrated companies, we limit the peer companies to comparable upstream and integrated energy companies.

For our top 13 senior executives in 2011, including the NEOs, annual total direct compensation is targeted at the median of the issuers (the "Suncor Compensation Peers") identified in the table below. The same peer group is used for benchmarking director compensation. Where Suncor ranks, as compared to the Suncor Compensation Peers, in relation to revenues, market capitalization and assets, is also provided below.

Canada		U.S.

Canadian Natural Resources Ltd. Cenovus Energy Inc. Encana Corporation Enbridge Inc. Husky Energy Inc. Imperial Oil Ltd. Nexen Inc. Talisman Energy Inc. TransCanada Corporation		Apache Corporation Anadarko Petroleum Corporation Chevron Corporation Chesapeake Energy Corporation ConocoPhillips Devon Energy Corporation EOG Resources Inc. Hess Corporation Marathon Oil Corporation Occidental Petroleum Corporation ⁽¹⁾

(1): Occidental is not included in the compensation benchmarking peer group for 2012.

Category		Percentile Rank

Revenues ⁽¹⁾		84 ^th
Market Capitalization ⁽²⁾		84 ^th
Assets ⁽¹⁾		89 ^th

(1): Percentile rank for Revenues and Assets is based on results reported as of September 30, 2011. Where applicable, results are converted to Canadian dollars based on the exchange rate on September 30, 2011.
(2): Percentile rank for Market Capitalization is based on results reported as of December 31, 2011. Where applicable, results are converted to Canadian dollars based on the exchange rate on December 31, 2011.

A similar peer group of 18 companies is used in determining the relative TSR performance for our PSU grants as described on page 48 of this management proxy circular. Fourteen companies are common to both benchmark groups. The difference in the peer groups reflects the different purposes of each group (i.e. benchmarking of executive pay vs. benchmarking company performance). We include only comparable North American upstream and integrated energy companies within the PSU peer group.

Executive Share Ownership Guidelines

Suncor strongly believes that executives' interests should be aligned with the interests of Suncor's shareholders. One of the key ways we reinforce the alignment of the interests of executives with shareholders is by requiring Suncor executives to have personal holdings in Suncor common shares or share equivalents equal to a multiple of their annual base salary.

Introduced in April, 1997, these guidelines visibly align senior management's interests with those of Suncor's shareholders and are supported by competitive benchmark data.

2011 and 2012 Guidelines. The share ownership guideline level is to be achieved within five years of appointment to an executive position, a promotion to a more senior executive position, or an increase in guideline level and must be maintained at the current base salary level. Suncor common shares and DSUs count toward fulfillment of the guidelines. The guidelines for 2011 are based on benchmark data and remain competitive at all executive levels with the Suncor Compensation Peers.

As at February 23, 2012, all NEOs were in compliance with the share ownership guidelines. Please see share ownership guidelines below.

Position		Effective January 1, 2011


President & CEO (effective December 01, 2011 – CEO)		5 × annual salary
Chief Operating Officer (effective December 01, 2011 – President & Chief Operating Officer)		4 × annual salary
Executive Vice President ("EVP")		3 × annual salary
Senior Vice President ("SVP")		2 × annual salary

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 29

CEO Hold Requirement. The CEO must maintain his share ownership level for one year following his retirement, which aligns with good governance practice.

Total Direct Compensation Components: Base Salary + Annual Incentive Plan + Mid- and Long-Term Incentives

Suncor's pay-for-performance compensation philosophy for executives is demonstrated in the mix of target total direct compensation provided. Total direct compensation, made up of base salary, AIP and mid- to long-term incentives, is designed to reward short-term results and achievement of sustained longer-term performance in key business areas that enable the operational and financial results important to our shareholders.

Incentive or variable, performance based compensation represents a significant portion of total direct compensation for senior executives. The percentage of variable, performance based versus fixed compensation increases as a portion of total direct compensation, with greater levels of responsibility, as shown in the target total direct compensation chart provided below.

(1): For the leader of a Business Unit, the 60% weight at target for the Business Unit component of AIP is based half on the performance of the leader's Business Unit and half on the weighted average performance of all Business Units of Suncor. For the CEO, President and COO and CFO, the 60% weight at target is based on the weighted average performance of all Business Units of Suncor. 2011 Business Units for the purpose of AIP are as follows: Oil Sands; In Situ; Exploration and Production; Refining & Marketing; Energy Supply, Trading & Development; and Major Projects.

30 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

COMPENSATION OF THE NAMED EXECUTIVE OFFICERS

2011 Company Performance Highlights. The company performance highlights outlined below provide context for compensation of the NEOs.

For the year ended December 31, 2011, Suncor recorded net earnings of $4.304 billion ($2.74 per common share), compared to $3.829 billion ($2.45 per common share) for the year ended December 31, 2010. Operating earnings ⁽¹⁾ more than doubled from $2.634 billion ($1.69 per common share) in 2010 to $5.674 billion ($3.61 per common share) in 2011. In addition, cash flow from operations ⁽¹⁾ increased to $9.746 billion ($6.20 per common share) in 2011 from $6.656 billion ($4.25 per common share) in 2010. While increased production from the company's oil sands business and a strong crude oil pricing environment were key drivers, the improved results were also due to increased premiums resulting from the company's capacity to upgrade bitumen and refine crude oil in-house.

(1): Operating earnings and cash flow from operations are non-GAAP measures. See the "Advisories" on page 5 of this management proxy circular.

In 2011, Suncor strengthened its balance sheet, as a result of reliable operating performance, significant cash flow from its integrated operations and the use of proceeds from asset dispositions to reduce total debt. Net debt as at December 31, 2011 was $7.0 billion, which decreased from $11.3 billion as at December 31, 2010. Cash and cash equivalents as at December 31, 2011 was $3.8 billion and has increased from $1.1 billion as at December 31, 2010.

Production at Oil Sands averaged a record 304,700 barrels per day ("bpd") in 2011, while In Situ production exceeded 100,000 bpd in late October, 2011 and exited 2011 averaging approximately 111,000 bpd.

Progress continued on major growth projects. While the company wound down its project work on the Firebag Stage 3 expansion, efforts continued on construction of Firebag Stage 4. Suncor started mining ore from the North Steepbank Extension in late December.

Suncor successfully completed execution of joint venture agreements with Total E&P Canada Ltd. ("Total") to facilitate the Joslyn, Voyageur upgrader and Fort Hills projects, and created a new business unit – Oil Sands Ventures.

The Refining and Marketing business unit contributed over $2.5 billion to cash flow from operations in 2011. Despite major planned maintenance events at its Edmonton and Commerce City refineries in the second quarter, overall refining utilization at its four refineries averaged 92% for 2011, a reflection of the company's focus on reliable operations.

In January 2011, Suncor completed the expansion of its ethanol plant in Ontario that doubled production capacity to 400 million litres per year and confirmed the plant as Canada's largest biofuels production facility. Later in the year, Suncor commenced operations at two new wind power projects – the 88 megawatt ("MW") Wintering Hills project in southern Alberta and the 20 MW Kent Breeze project in southwest Ontario.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 31

Suncor 2011 AIP Performance

Suncor's AIP rewards NEOs and other eligible plan participants based on the performance achieved versus the approved annual targets in key performance areas and for personal performance. The following table summarizes overall 2011 performance results for the Corporate and Business Unit components of the Suncor AIP and the scores achieved versus the 2011 opportunity. For a description of how the Personal component of the AIP was calculated for 2011, please refer to each NEO's 2011 compensation beginning on page 34 of this management proxy circular.


AIP Component (AIP Target Weight) ⁽¹⁾	Overall Score ⁽³⁾	Performance Area ⁽⁴⁾	Key Measures ⁽⁵⁾	Suncor 2011 Aggregate Component Score ^(3)(6)(7)	Comments

Corporate (20%)	200 ⁽⁸⁾	Cash Flow From Operations ("CFOPS")	CFOPS	200	Achieved CFOPS of over $9.6 billion versus target of $6.3 billion, reflecting Suncor's solid operations and a strong business environment.

	138	Personal and Process Safety	Recordable Injury Frequency, Lost Time Injury Frequency, Number of High Risk Incidents and other Business Unit Specific Measures	168	Each Business Unit exceeded their aggregate target, reflecting Suncor's relentless focus on safety.

Business Unit ⁽²⁾ (60%)		Environment	Number of Regulatory Non-Compliances, Energy Intensity, Number of Losses Of Containment and other Business Unit Specific Measures	142	Five Business Units exceeded their aggregate target. The E&P Business Unit's results were below target, partly due to the negative impact of lower than planned production on energy intensity.

		Reliability	Production, Cash Operating Cost, Execution of Growth Plans and other Business Unit Specific Measures	127	Each Business Unit met or exceeded their aggregate target, reflecting the positive impact of ongoing programs to increase reliability while maintaining a focus on costs.

		People	Voluntary Attrition, Culture Survey Improvement and other Business Unit Specific Measures	140	Each Business Unit exceeded their aggregate target, reflecting strong employee engagement.

(1): Does not include individual performance, which represents 20% of the AIP target.
(2): 2011 Business Units for the purpose of AIP are as follows: Oil Sands; In Situ; Exploration & Production; Refinery & Marketing; Energy Supply, Trading & Development; and Major Projects.
(3): The opportunity for the Corporate and Business Unit component of AIP ranges from 0-200, with a target score of 100.
(4): Suncor's Business Unit guideline target weightings by Performance Area are as follows: 15% for each of Personal and Process Safety, Environment and People; and 55% for Reliability. However, these target weightings may vary slightly for individual Business Units, to place increased emphasis on a particular performance area for that year (for example, in 2011, the Refining & Marketing Business Unit assigned a 15% target weighting to Environment and People, 20% to Personal and Process Safety, and 50% to Reliability). For 2011, the company-wide average target weightings for the four performance areas within the Business Unit component of AIP in the table above were as follows: 17% for each of Personal and Process Safety; 15% for Environment; 53% for Reliability; and 15% for People.
(5): Certain measures may not be applicable to all Business Units. For example, Production is not a measure for the Major Projects Business Unit. In addition, certain Business Units may have additional measures as compared to what is provided in the table above. For example, the Refining & Marketing Business Unit measures include specific reliability measures focusing on Retail, Wholesale, Distribution and Lubricants operations.
(6): The Performance Area scores for the Business Unit component of AIP reflect the aggregate scores achieved across the Business Units. Performance for individual Business Units varied from the aggregate scores.
(7): The AIP has a threshold CFOPS level below which AIP payments are reduced to 50%, which was $4.9 billion for 2011. The AIP threshold CFOPS level below which no payment would be made under the AIP was $2.5 billion for 2011. CFOPS is not prescribed by Canadian generally accepted accounting principles. See the "Advisories" on page 5 of this management proxy circular for an explanation as to how CFOPS is calculated for the purposes of AIP.
(8): For 2011, a score of 200 required CFOPS of $7.6 billion.

2011 Performance Of The CEO

2011 was a significant year for Suncor in terms of both operational and financial performance. With the Petro-Canada post-merger integration efforts demonstrating synergies and savings in 2010, the company was well-positioned to leverage its fully integrated business model to deliver results. The Board observed that a strong focus on operational excellence, which led to gains in reliability and record oil sands production, was a significant factor in delivering shareholder value, as reflected in

32 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

record annual operating earnings of $5.674 billion ($3.61 per common share) and highest ever cash flow from operations, reaching nearly $9.8 billion.

2011 also marked the first full year for implementing Suncor's ten-year growth plan, which is expected to boost total production to more than one million barrels of oil equivalent per day by 2020, provided all of the projects prove economic and are implemented. The formation of a strategic alliance with Total, finalized in March 2011, was an important element of Suncor's plans to accelerate development of its growth portfolio. As a result, Suncor expects it will be able to pool its manpower and capital resources and bring its collective strengths to bear to manage projects using best-in-class operating practices.

International developments also led to changes within the company's Exploration and Production ("E&P") business unit. In response to the political upheaval in Libya, Suncor suspended E&P activities in the country during the first quarter. After the lifting of sanctions, Suncor began a gradual return to the country during the fourth quarter following a change in the political regime.

Amidst continuing political and social unrest in Syria that led to international sanctions, Suncor declared force majeure under its contractual obligations. Having successfully evacuated expatriate staff, the company has ceased recording all production and revenue associated with the Ebla project in Syria.

In December, Rick George announced his plan to retire, having been the company's CEO since 1991. Mr. George, over the past few years, has been working with the Board to ensure an orderly transition of leadership through the development and implementation of a comprehensive succession plan. Steve Williams was appointed as Suncor's President & COO and a member of the company's Board and will assume the role of CEO in May 2012.

In addition to effectively guiding the company through extraordinary circumstances in 2011, Mr. George also continued to lead and deliver results in other areas of his annual performance objectives. As a result, the Board evaluated Mr. George's performance as "Exceptional" for 2011.

The following is a summary for each of the key performance areas.

Financial And Operating Results Achieved During 2011. Operational results were strong, reflecting an ongoing commitment to improving reliability. The company achieved total average production of 546,000 barrels of oil equivalent per day (boe/d), including 339,300 boe/d from Oil Sands (including Syncrude) and 206,700 boe/d from E&P.

Overall financial performance improved significantly over 2010, despite a year marked by worldwide economic instability and market volatility. The company achieved record net earnings in 2011, and operating earnings in 2011 more than doubled as compared to 2010. Cash flow from operations improved by nearly 50% in 2011, reaching the highest annual cash flow from operations in the company's history.

The Board believes that a key to the company's success in the 2011 business environment was the ongoing business integration efforts led by Mr. George, which ensured Suncor's ability to capitalize on the strength of its integrated business model and maximize the return on the barrels of oil produced at all levels of the value chain. This was complemented by a significant focus by Mr. George, along with Mr. Williams, on operational excellence in the base businesses, as demonstrated by strong reliability across the company.

While production was strong in terms of volume, the Board noted that room for improvement remained in the Oil Sands business to ensure the company maximizes the flexibility of its oil sands production slate.

Net debt at year-end 2011 was $7 billion, and has decreased from $11.3 billion at December 31, 2010. This debt level is well within the company's target of 2:1 net debt to cash flow from operations ratio and puts Suncor's balance sheet in a position of strength as the company enters a significant period of growth.

Operational Excellence, Safety And Environmental Performance. Working with Mr. Williams, Suncor's President and COO, Mr. George continued to advance the company's operational excellence program, specifically improving reliability, workforce efficiency and engagement, personal and process safety and environmental performance.

Efforts in this area yielded tangible results, including Oil Sands successfully completing the largest turnaround in its history. In addition, total Oil Sands (excluding Syncrude) production exceeded 325,000 bpd on average over the second half of 2011, including a single month production record of 345,000 bpd on average in December 2011. Bitumen production from Suncor's in situ assets averaged nearly 90,000 bpd in 2011 and exited the year at a record 111,000 bpd.

Ongoing efforts to drive continuous improvement and efficiencies were reflected in stronger central standards, tools and capabilities, as well as the establishment of an Oil Sands Ventures team with an operational excellence culture being the cornerstone. The focus on operational excellence has also been reflected in strong production performance at the company's Firebag in situ project, following the ramp up of Firebag Stage 3.

In 2011, human resources' key metrics were significantly improved, including voluntary and early attrition rates, more favorable culture survey results and increased survey participation rates across the company.

A focus on safety through the Journey to Zero program continued as part of the company's operational excellence efforts. Recordable injury frequency declined 17% versus 2010 and lost time injury frequency declined 40% compared to the same

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 33

period. The number of high risk incidents, a leading indicator of safety, declined 68% in 2011 when compared to 2010. Despite these improvements, Suncor experienced a fatality in 2011 with a contractor passing away as a result of injuries sustained at the company's Firebag in situ operations.

On the environmental front, Suncor continued to be a leader in the oil sands industry, with TRO _TM tailings management process implementation advancing on plan, enabling the cancellation of five new tailings ponds and enabling the company to target reduction of current tailings ponds at Suncor's current base mine site from eight to one. In addition, regulatory non-compliances were reduced by 14% versus 2010 results, while losses of containment were reduced by 8% for the same period. The company has also made progress on its air, water, land and energy efficiency environmental goals.

Major Project Execution And Cost Control. Due to the size of current and planned capital project investments and concerns about the potential for inflation in northern Alberta, considerable attention was dedicated towards planning, cost control and execution of major projects. With the exception of Firebag Stage 3, the budget and schedule of which were challenged by the impacts of putting the project into safe mode during the 2008 economic downturn, all other projects were executed within plans. Discussions with our joint venture partners on the Joslyn project are expected to result in operational synergies. The Board noted that planning efforts on the MacKay River 2 project were progressing well and that Firebag Stage 4 was progressing on plan. This latter project is expected to benefit from learnings acquired during the construction and commissioning of Firebag Stage 3, which is demonstrating production in line with expectations.

The economics of the Voyageur and Fort Hills projects are expected to improve as a result of the strategic alliance with Total, however work continues in the Oil Sands Venture and Major Projects teams to explore further means of improving returns on capital. Meanwhile, productivity improvements at the company's oil sands sites are helping to mitigate inflationary pressures in the area.

Leadership On Policy And Industry Issues. As the largest oil sands operator and one of North America's largest energy companies, Suncor continues to play an active role in public dialogue on energy, the economy and the environment.

Mr. George had several meetings with senior government, industry and stakeholder representatives. These meetings supported, among other things, the company's goal to be a safe and responsible operator in Syria and Libya in line with the company's human rights policy, and were in support of the role of oil sands as a strategic energy resource for North America and beyond. Mr. George also served as a Canadian government appointee at the International Energy Association meeting.

Mr. George continued to engage with stakeholder groups, built strong relations with joint venture partners and key suppliers and personally delivered over 19 speeches to a variety of audiences in Canada and the United States. During the year, he was the most visible Canadian energy company CEO in the media, as highlighted by third party analysis.

Outside of Suncor in 2011, Mr. George maintained an active role in the Canadian Association of Petroleum Producers oil sands CEO task group, continuing to work with other industry CEOs in providing leadership and direction on improving the industry's performance and engagement on oil sands development issues. He, along with Steve Williams, has been a driving force behind the creation of the Oil Sands Leadership Initiative (OSLI). He served on the Board of the Canadian Council of Chief Executives, and was a member of its Task Force on Environment. He also was a member of the Energy Policy Institute of Canada. The Board congratulates Mr. George on being named Distinguished Business Person of the Year by the Haskayne School of Business and the Calgary Chamber of Commerce, as well as Canadian Energy Person of the Year, by the Energy Council of Canada.

Effective Relationship With The Board Of Directors. Mr. George recognizes the importance the Board places on the stewardship of shareholder interests. He continues to keep the Board fully informed on financial, operational and strategic issues and ensures the availability of senior executives and technical experts to the Board in support of its deliberations. Through the succession plan, and with the appointment of Mr. Williams as a member of the Board of Directors, he has effectively positioned Mr. Williams for his future responsibilities as they relate to the Board. The Board wishes to commend Mr. George on his career with Suncor and extends its appreciation for his unwavering dedication to the company and its shareholders.

2011 Compensation of the CEO

Base Salary. Base salary is the only portion of the NEO's total direct compensation that is not variable, performance based pay and therefore not directly tied to corporate performance and shareholder value.

The base salary level for the CEO is reviewed annually by the HR&CC and any change in the salary level is recommended to the Board. The CEO did not receive an increase in base salary in 2010. In 2011, the CEO received a 7.1% base salary increase. The 2011 increase in base salary was made to reflect the CEO's demonstrated capability and maintain the CEO's salary near the median of CEO salaries for the Suncor Compensation Peers.

Annual Incentive. The CEO's actual 2011 AIP payout was $3,060,000. This payout level was 163% of his annual incentive opportunity, which had a target of $1,875,000 or 125% of his salary (with a range of 0% to 220% of target). The table below displays the AIP components and calculation of the CEO's 2011 AIP award.

34 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

In preparing for evaluating the CEO's 2011 personal performance, a detailed assessment was completed by all independent Board members, which focused on six key performance areas: Strategic Planning; Financial Results; Leadership; Succession Planning and Management Development; Government, Environment and Social Relations; and Board Relations. The independent Board member evaluation, along with the CEO's self-assessment of performance against his personal goals, was collected, reviewed by the chairman of the Board and the chair of the HR&CC and a performance rating for the year was determined. The CEO's performance was rated as "exceptional" by the Board for 2011. The CEO's performance in 2011 is described under "2011 Performance Of The CEO" on page 32 of this management proxy circular.

				(A × B)		(C × D)		(E X F)
AIP Component	Performance Area	AIP Component Target % [A]	AIP Component Score [B]	Performance Factor % ⁽²⁾ [C]	AIP Target % ⁽³⁾ [D]	Award Payout % ⁽⁴⁾ [E]	2011 Base Salary ⁽⁵⁾ ($) [F]	2011 Award Payout ⁽⁶⁾⁽⁷⁾ ($)


Corporate Performance	Cash Flow From Operations	20%	200	40%	125%	50%	1 500 000	750 000
Business Unit Performance ⁽¹⁾	Personal and Process Safety, Environment, Reliability, People	60%	138	83%	125%	104%	1 500 000	1 560 000
Personal Performance	Board Assessment of CEO	20%	200	40%	125%	50%	1 500 000	750 000

Total ⁽⁷⁾		100%	—	163%	—	204%	—	3 060 000

(1): The Business Unit Performance score is based on the weighted average of the Oil Sands, In Situ, Exploration & Production, Refining & Marketing, Energy Supply, Trading & Development and Major Projects Business Units' performance scores. See "Suncor 2011 AIP Performance" on page 32 of this management proxy circular.
(2): Performance Factor % is the result of multiplying the AIP Component Target % by the actual score achieved for the particular AIP Component.
(3): AIP Target derived from benchmark data expressed as a percent of annual salary.
(4): Award Payout % is the result of multiplying the Performance Factor % by the AIP Target %.
(5): Base salary is at December 31, 2011.
(6): 2011 Award Payout is the result of multiplying the Award Payout % by the 2011 Base Salary.
(7): Totals are rounded.

Mid- to Long-Term Incentive. Mid- to long-term incentive awards reward performance in relation to increases in Suncor's common share price and to achievement of specific performance thresholds.

The target value of the equity award granted to the CEO is based on median benchmark data for the Suncor Compensation Peers. The HR&CC reviews competitive data and market practice with regard to equity plans and awards, and approves amendments as they deem appropriate to meet Suncor's executive compensation philosophy and to reflect the CEO's performance as determined by the Board. The previous year's equity award under the SOP and PSU Plan was also taken into account by the HR&CC when considering Mr. George's grant.

The 2011 equity award, made in early 2011, reflects a 14% increase in the market target value at the median of the Suncor Compensation Peers and the CEO's performance as determined by the Board. Fifty percent of the 2011 equity award value was provided in stock options and fifty percent was in PSUs. PSUs provide focus on relative and absolute share price performance. The stock options and PSUs awarded are contingent upon future performance which, if not achieved, will reduce or negate the actual value of these awards.

For further details on Mr. George's 2011 equity award and total compensation for 2011, see the "Summary Compensation Table" on page 42 of this management proxy circular.

2011 Compensation of the CFO

2011 Performance. As CFO, Mr. Demosky is responsible for financial operations, including investor relations, tax, treasury, audit and risk management. In 2011, he strengthened the company's financial flexibility and balance sheet credit metrics while improving shareholder returns through the return of excess cash. This effort included improving the debt to capitalization ratio and debt to cash flow multiple, as well as an increase of the annualized dividend to $0.44 per share and successful completion of a $500 million normal course issuer bid.

A key accomplishment for Mr. Demosky was improving Suncor's financial liquidity and market access to funding. This included reducing the company's net debt, increasing cash on the balance sheet, renewal of the company's syndicated bank credit facilities at market-leading terms and conditions and successfully launching a U.S. commercial paper program to capture lower interest rates.

Mr. Demosky's efforts included enhancing Suncor's risk assessment, management and reporting capabilities through process and technology improvements, in addition to strengthening Suncor's financial controls and reporting infrastructure. As well, he ensured the development and delivery of consistent and effective communication of Suncor's strategic plan to investors, analysts, banks and credit rating agencies.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 35

Base Salary. The CFO received a 10% base salary increase, which was made in order to reflect the CFO's demonstrated capability in his role and to provide a salary level near the median of salaries at this senior executive level for the Suncor Compensation Peers.

Annual Incentive. The CFO's actual 2011 AIP payout was $420,000. This payout level was 155% of his annual incentive opportunity, which had a target of $270,000 or 60% of his salary (with a range of 0% to 220% of target). The following table displays the AIP components and calculation of the CFO's 2011 AIP award.

				(A × B)		(C × D)		(E X F)
AIP Component	Performance Area	AIP Component Target % [A]	AIP Component Score [B]	Performance Factor % ⁽²⁾ [C]	AIP Target % ⁽³⁾ [D]	Award Payout % ⁽⁴⁾ [E]	2011 Base Salary ⁽⁵⁾ ($) [F]	2011 Award Payout ⁽⁶⁾⁽⁷⁾ ($)


Corporate Performance	Cash Flow From Operations	20%	200	40%	60%	24%	450 000	108 000
Business Unit Performance ⁽¹⁾	Personal and Process Safety, Environment, Reliability, People	60%	138	83%	60%	50%	450 000	225 000
Personal Performance	CEO Assessment of CFO	20%	162	32%	60%	19%	450 000	86 000

Total ⁽⁷⁾		100%		155%	—	93%	—	420 000

(1): The Business Unit Performance score is based on the weighted average of the Oil Sands, In Situ, Exploration & Production, Refining & Marketing, Energy Supply, Trading & Development and Major Projects Business Units' performance scores. See "Suncor 2011 AIP Performance" on page 32 of this management proxy circular.
(2): Performance Factor % is the result of multiplying the AIP Component Target % by the actual score achieved for the particular AIP Component.
(3): AIP Target derived from benchmark data expressed as a percent of annual salary.
(4): Award Payout % is the result of multiplying the Performance Factor % by the AIP Target %.
(5): Base salary is at December 31, 2011.
(6): 2011 Award Payout is the result of multiplying the Award Payout % by the 2011 Base Salary.
(7): Totals are rounded.

Mid- to Long-Term Incentive. The 2011 equity award, made in early 2011, reflects a 10% increase in the market target value at the median of the Suncor Compensation Peers and the CFO's performance as determined by the CEO. The previous year's equity award under the SOP and PSU Plan was also taken into account by the HR&CC when considering Mr. Demosky's grant.

For further details on Mr. Demosky's 2011 equity award and total compensation for 2011, see the "Summary Compensation Table" on page 42 of this management proxy circular.

2011 Compensation of the President & COO

2011 Performance. As COO, and as of December 1, 2011, President, Mr. Williams has been charged with delivering strong performance-related results for shareholders. A key focus for him in 2011 included driving continuous improvement throughout Suncor through operational excellence, with a focus on safety, environment, reliability and people. Work in this area also included accelerating Suncor's journey to becoming a more disciplined process-focused organization.

Mr. Williams helped Suncor achieve record performance in all dimensions of operational excellence, including the company generally exceeding production, availability and utilization expectations.

Other accomplishments included the North Steepbank project producing first oil in 2011, Firebag Stage 3 ramp up in line with expectations, the successful implementation of SAP within the company and progress on the Joslyn mine plan. Mr. Williams also led the company's United Way campaign, which achieved a record $6.25 million in pledge donations.

Base Salary. The President and COO received a 7% base salary increase, which was made in order to reflect the President and COO's demonstrated capability in his role and to ensure his salary continues to be competitive with salaries at this senior executive level for the Suncor Compensation Peers.

36 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Annual Incentive. The President and COO's actual 2011 AIP payout was $1,300,000. This payout level was 158% of his annual incentive opportunity, which had a target of $820,000 or 100% of his salary (with a range of 0% to 220% of target). The following table displays the AIP components and calculation of the President and COO's 2011 AIP award.

				(A × B)		(C × D)		(E X F)
AIP Component	Performance Area	AIP Component Target % [A]	AIP Component Score [B]	Performance Factor % ⁽²⁾ [C]	AIP Target % ⁽³⁾ [D]	Award Payout % ⁽⁴⁾ [E]	2011 Base Salary ⁽⁵⁾ ($) [F]	2011 Award Payout ⁽⁶⁾⁽⁷⁾ ($)


Corporate Performance	Cash Flow From Operations	20%	200	40%	100%	40%	820 000	328 000
Business Unit Performance ⁽¹⁾	Personal and Process Safety, Environment, Reliability, People	60%	138	83%	100%	83%	820 000	681 000
Personal Performance	CEO Assessment of President & COO	20%	175	35%	100%	35%	820 000	287 000

Total ⁽⁷⁾		100%		158%	—	158%	—	1 300 000

(1): The Business Unit Performance score is based on the weighted average of the Oil Sands, In Situ, Exploration & Production, Refining & Marketing, Energy Supply, Trading & Development and Major Projects Business Units' performance scores. See "Suncor 2011 AIP Performance" on page 32 of this management proxy circular.
(2): Performance Factor % is the result of multiplying the AIP Component Target % by the actual score achieved for the particular AIP Component.
(3): AIP Target derived from benchmark data expressed as a percent of annual salary.
(4): Award Payout % is the result of multiplying the Performance Factor % by the AIP Target %.
(5): Base salary is at December 31, 2011.
(6): 2011 Award Payout is the result of multiplying the Award Payout % by the 2011 Base Salary.
(7): Totals are rounded.

Mid- to Long-Term Incentive. The 2011 equity award, made in early 2011, reflects a 7% increase in the market target value at the median of the Suncor Compensation Peers and the President and COO's performance as determined by the CEO. The previous year's equity award under the SOP and PSU Plan was also taken into account by the HR&CC when considering Mr. Williams' grants.

For further details on Mr. Williams' 2011 equity award and total compensation for 2011, see the "Summary Compensation Table" on page 42 of this management proxy circular.

2011 Compensation of the EVP, Refining and Marketing

2011 Performance. In his capacity as EVP, Refining and Marketing, Mr. Jackman helped the company achieve strong results. With his leadership, Refining and Marketing had record financial performance in 2011, fueled by strong reliability at all operating facilities which enabled leveraging of market conditions.

The Refining and Marketing business unit delivered on all controllable measures in its operational excellence framework of safety, environment, reliability, expense management and people. A continued focus on personal and process safety yielded total recordable injury frequency of 0.52 injuries per 200,000 manhours worked.

Effective sales and marketing programs, meanwhile, helped deliver record net earnings in Retail and Wholesale, including record convenience store and car wash sales, and record sales' volume in core wholesale channels. Lubricants had record net earnings and sales volumes, with double digit percentage growth in margins and volume over 2010.

Through its Petro-Canada branded outlets, Refining and Marketing continued to be one of the leading retailers in Canada as measured by market share in major urban areas. As of September 30, 2011, Suncor had one of the most profitable networks of its kind in North America (based on earnings per barrel of crude refining capacity).

Base Salary. The EVP, Refining and Marketing did not receive a base salary increase in 2011 as his salary is positioned at the top of the competitive salary range for the EVP level compared to the Suncor Compensation Peers.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 37

Annual Incentive. The EVP, Refining and Marketing's actual 2011 AIP payout was $1,000,000. This payout level was 177% of his annual incentive opportunity, which had a target level of $562,500 or 75% of his salary (with a range of 0% to 220% of target). The following table displays the AIP components and calculation of the EVP, Refining and Marketing's 2011 AIP award.

				(A × B)		(C × D)		(E X F)
AIP Component	Performance Area	AIP Component Target % [A]	AIP Component Score [B]	Performance Factor % ⁽²⁾ [C]	AIP Target % ⁽³⁾ [D]	Award Payout % ⁽⁴⁾ [E]	2011 Base Salary ⁽⁵⁾ ($) [F]	2011 Award Payout ⁽⁶⁾⁽⁷⁾ ($)


Corporate Performance	Cash Flow From Operations	20%	200	40%	75%	30%	750 000	225 000
Business Unit Performance ⁽¹⁾	Personal and Process Safety, Environment, Reliability, People	30%	145	44%	75%	33%	750 000	248 000
Weighted Average of all Business Units' Performance ⁽¹⁾	Personal and Process Safety, Environment, Reliability, People	30%	138	41%	75%	31%	750 000	233 000
Personal Performance	President & COO Assessment of EVP, Refining & Marketing	20%	262	52%	75%	39%	750 000	293 000

Total ⁽⁷⁾		100%		177%	–	133%	–	1 000 000

(1): The Business Unit Performance score represents the Refining & Marketing Business Unit and represents 30% of the AIP at target. The Weighted Average of all Business Units' Performance score is based on the weighted average of the Oil Sands, In Situ, Exploration & Production, Refining & Marketing, Energy Supply, Trading & Development and Major Projects Business Units' performance scores and represents 30% of the AIP at target. See "Suncor 2011 AIP Performance" on page 32 of this management proxy circular.
(2): Performance Factor % is the result of multiplying the AIP Component Target % by the actual score achieved for the particular AIP Component.
(3): AIP Target derived from benchmark data expressed as a percent of annual salary.
(4): Award Payout % is the result of multiplying the Performance Factor % by the AIP Target %.
(5): Base salary is at December 31, 2011.
(6): 2011 Award Payout is the result of multiplying the Award Payout % by the 2011 Base Salary.
(7): Totals are rounded.

Mid- to Long-Term Incentive. The 2011 equity award, made in early 2011, reflects a 10% increase in the market target value at the median of the Suncor Compensation Peers and the EVP, Refining and Marketing's performance as determined by the President and COO. The previous year's equity award under the SOP and PSU Plan was also taken into account by the HR&CC when considering Mr. Jackman's grant.

For further details on Mr. Jackman's 2011 equity award and total compensation for 2011, see the "Summary Compensation Table" on page 42 of this management proxy circular.

2011 Compensation of the EVP, Oil Sands

2011 Performance. As EVP, Oil Sands ⁽¹⁾ , Mr. Little led the delivery of strong results in support of the company's business objectives. Record performance was achieved in many areas of operational excellence, including safety, risk, environmental incident and energy management. Through Mr. Little's leadership, the business unit is well-positioned to achieve volume and cost budgets.

(1): Effective January 1, 2012, Mr. Little was appointed to Executive Vice President, Oil Sands and In Situ. In 2011, Mr. Little was Executive Vice President, Oil Sands from January 31, 2011 and Senior Vice President, International & Offshore prior to that date.

Mr. Little has actively promoted operational excellence within his business unit, focusing the organization on operating reliably and generating cash and returns for shareholders. He is a strong member of the senior executive team, engaging regularly with other parts of the business on operational excellence initiatives and representing the company externally through a broad range of government, stakeholder and community interactions.

Base Salary. The EVP, Oil Sands received a 22% base salary increase, which was made in order to recognize Mr. Little's promotion to EVP, Oil Sands in January 2011, moving his base salary towards the median of salaries at this senior executive level for the Suncor Compensation Peers.

38 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Annual Incentive. The EVP, Oil Sands' actual 2011 AIP payout was $610,000. This payout level was 162% of his annual incentive opportunity, which had a target level of $375,000 or 75% of his salary (with a range of 0% to 220% of target). The following table displays the AIP components and calculation of the EVP, Oil Sands' 2011 AIP award.

				(A × B)		(C × D)		(E X F)
AIP Component	Performance Area	AIP Component Target % [A]	AIP Component Score [B]	Performance Factor % ⁽²⁾ [C]	AIP Target % ⁽³⁾ [D]	Award Payout % ⁽⁴⁾ [E]	2011 Base Salary ⁽⁵⁾ ($) [F]	2011 Award Payout ⁽⁶⁾⁽⁷⁾ ($)


Corporate Performance	Cash Flow From Operations	20%	200	40%	75%	30%	500 000	150 000
Business Unit Performance ⁽¹⁾	Personal and Process Safety, Environment, Reliability, People	30%	135	41%	75%	31%	500 000	155 000
Weighted Average of all Business Units' Performance ⁽¹⁾	Personal and Process Safety, Environment, Reliability, People	30%	138	41%	75%	31%	500 000	155 000
Personal Performance	President & COO Assessment of EVP, Oil Sands	20%	200	40 %	75%	30 %	500 000	150 000

Total ⁽⁷⁾		100%		162%	–	122%	–	610 000

(1): The Business Unit Performance score is for the Oil Sands Business Unit and represents 30% of the AIP at target. The Weighted Average of all Business Units' Performance score is based on the weighted average of the Oil Sands, In Situ, Exploration & Production, Refining & Marketing, Energy Supply, Trading & Development and Major Projects Business Units' performance scores and represents 30% of the AIP at target. See "Suncor 2011 AIP Performance" on page 32 of this management proxy circular.
(2): Performance Factor % is the result of multiplying the AIP Component Target % by the actual score achieved for the particular AIP Component.
(3): AIP Target derived from benchmark data expressed as a percent of annual salary.
(4): Award Payout % is the result of multiplying the Performance Factor % by the AIP Target %.
(5): Base salary is at December 31, 2011.
(6): 2011 Award Payout is the result of multiplying the award payout % by the 2011 Base Salary.
(7): Totals are rounded.

Mid- to Long-Term Incentive. The 2011 equity award, made in early 2011, reflects a 10% increase in the market target value at the median of the Suncor Compensation Peers, Mr. Little's promotion to EVP, Oil Sands in early 2011 and his performance as determined by the President and COO. The previous year's equity award under the SOP and PSU Plan was also taken into account by the HR&CC when considering Mr. Little's grant.

For further details on Mr. Little's 2011 equity award and total compensation for 2011, see the "Summary Compensation Table" on page 42 of this management proxy circular.

Executive Compensation Alignment With Shareholder Value

The Board recognizes that in an industry subject to commodity price cycles, Suncor's focus is on long-term shareholder value growth. Suncor's common shares were valued at $29.38 on the TSX at December 31, 2011, a decrease of approximately 23% over the year before. From 2006 to 2011, Suncor's share price decreased by approximately 33%. The following performance graph shows Suncor's total cumulative shareholder return for the past five years.

Performance Graph ⁽¹⁾⁽²⁾

(1): The graph reflects the total cumulative return, assuming the reinvestment of all dividends, of $100 invested on December 31, 2006 in each of Suncor common shares, the S&P/TSX Composite (TRIV) Index and the S&P/TSX Energy (TRIV) Index.
(2): The year-end values of each investment shown on the graph are based on share price appreciation plus dividend reinvestment.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 39

The expected value and current value of total direct compensation for the NEOs, for the period from 2007 to 2011, are illustrated in the graph below. Over this period, the current value at December 31, 2011 of total direct compensation for the NEOs was approximately 33% lower than the expected value as determined in accordance with the methodology described in the footnotes of the Total Direct Compensation Graph. The lower current value of the total direct compensation for the NEOs is generally consistent with the trend of total return on investment indicated for Suncor in the performance graph provided on page 39 of this management proxy circular.

Suncor's strong operational performance in 2010 and 2011 resulted in above target payouts under the AIP component of total direct compensation. However, this strong operational performance has not been reflected in our share price. At December 31, 2011, the current value of mid- to long-term incentive awards granted during 2007 to 2011 was 53% lower than the expected value, as determined in accordance with the methodology described in the footnotes of the Total Direct Compensation Graph. This reflects the high proportion of variable, performance based compensation in the total direct compensation provided to the NEOs.

The downturn in the market and decline in Suncor's share price would have resulted in outstanding option awards for 2007, 2008, 2010 and 2011, including the Suncor SunShare 2012 Plan (the "SunShare 2012 Plan") performance options granted in 2007, having no cash value if exercised at December 31, 2011. In addition, the PSU awards, granted in 2007 and 2008, provided no payment as the threshold level of relative TSR performance was not achieved. The lower current value at December 31, 2011 of the mid- to long-term incentive awards, which represent 50% or more of total direct compensation for the NEOs, demonstrates Suncor's pay-for-performance philosophy and alignment with shareholder interests.

Total Direct Compensation Graph ^(1)(2)(3)
In millions ($)

(1): Values included for 2007 to 2011 include those ascribed to Messrs. George, Demosky, Williams, Jackman and Little, except for 2007, which does not include Mr. Little, as he was not employed by Suncor during this year. Mr. Little's promotion to EVP is reflected in 2011 values.
(2): The Expected Value columns in the graph illustrate the expected value of total direct compensation as at December 31 of the particular year reported, and in the case of the Aggregate 5 Year Total, a sum of the expected values reported for 2007 to 2011. The expected value includes salary and annual incentive earned during the year reported and the grant date fair value of mid- to long-term awards granted in the particular year reported using Towers Watson's binomial valuation methodology.
(3): The Current Value columns in the graph illustrate the current value of total direct compensation of the particular year, which includes salary and annual incentive earned during the particular year reported and mid- to long-term incentives granted during the particular year valued as follows: (i) value (market price received less exercise price) of options that were granted in that particular year and that were exercised as at or prior to December 31, 2011; (ii) value attributed to PSUs and RSUs that were granted in that particular year and that had vested as at or prior to December 31, 2011; (iii) the 'in-the-money' value (as at December 31, 2011) of options that were granted in that particular year and that had not been exercised as at December 31, 2011; and (iv) the value (as at December 31, 2011) for PSUs at target and RSUs that were granted in that particular year and that have not vested as at December 31, 2011. In the case of the Aggregate 5 Year Total, a sum of the current values reported for 2007 to 2011.

CEO Look Back

The HR&CC annually reviews a broader analysis of the total compensation earned and accruing to the CEO since his appointment and relates it to the TSR during the same period. In its last review, the HR&CC related the total accrued compensation earned by the CEO up to December 31, 2011 to both the absolute increase in market capitalization, and the relative increase in market capitalization versus a relevant index, over the same period, and found it to be reasonable.

Looking Ahead to 2012:

The HR&CC approved a 2% salary structure increase in 2012 for executives other than the CEO (there was no structure increase for the CEO) and a 4% budget for increases in executives' salaries based on competitive benchmarking. The structure increase ensures that the target level for executive base salaries remains near the median of the Suncor Compensation Peers.

No changes were made in 2012 to executive AIP target percentage levels, or to mid- and long-term incentive award targets expressed as a percentage of base salary.

40 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

2012 Mid- to Long-Term Incentive Grants. Effective February 6, 2012, the Board approved the grant of options and PSUs to the Named Executive Officers, as described in the table below, and to certain other eligible employees under the terms of the SOP and the PSU Plan. The exercise price for each option granted was $34.58, which was based on the average of the high and low market price on the TSX of Suncor common shares on February 3, 2012. Each option granted to an executive was awarded with an associated limited appreciation right ("LAR", further details of which are described on page 46 of this management proxy circular).

Name	Options	PSUs


R.L. GEORGE	400 000	133 410
B.W. DEMOSKY	70 000	23 350
S.W. WILLIAMS	368 000	122 680
B.J. JACKMAN	120 000	40 000
M.S. LITTLE	130 000	43 350

COMPENSATION DISCLOSURE OF NAMED EXECUTIVE OFFICERS

Aggregate Equity Holdings. The following table sets forth the aggregate equity holdings of the Named Executive Officers for the years ended December 31, 2010 and 2011 as well as the net change during 2011 and the total value at risk as at December 31, 2011.

	December 31, 2010						December 31, 2011

Name	Shares	DSUs ⁽¹⁾		PSUs ⁽¹⁾ ⁽²⁾	Options	RSUs ⁽³⁾	Shares	DSUs ⁽¹⁾		PSUs ⁽¹⁾ ⁽²⁾	Options	RSUs ⁽³⁾


R.L. GEORGE	412 847	422 496		208 750	2 866 300	35 470	413 063	428 086		251 893	3 049 100	6 500
B.W. DEMOSKY	5 325	—		30 703	153 736	7 784	7 675	—		43 518	225 736	1 800
S.W. WILLIAMS	31 940	13 399	⁽⁴⁾	93 836	944 000	17 650	215 672	38 733	⁽⁴⁾	115 220	964 000	3 800
B.J. JACKMAN	5 950	121 633		95 462	877 400	—	5 950	123 234		99 949	855 600	—
M.S. LITTLE	11 442	—		28 524	128 620	6 130	19 619	—		49 539	228 620	2 300

	Net change during 2011							Total Value at Risk

Name	Shares	DSUs	PSUs	Options		RSUs		Value ⁽⁵⁾ ($)	Multiple of Salary (#)


R.L. GEORGE	216	5 590	43 143	182 800		(28 970	)	56 368 232	38
B.W. DEMOSKY	2 350	—	12 815	72 000		(5 984	)	1 605 728	4
S.W. WILLIAMS	183 732	25 334	21 384	20 000		(13 850	)	14 882 937	18
B.J. JACKMAN	—	1 601	4 487	(21 800	)	—		11 322 396	15
M.S. LITTLE	8 177	—	21 015	100 000		(3 830	)	2 308 876	5

(1): DSUs and PSUs, other than PSUs issued under the PSU Plan prior to January 1, 2010, include dividend reinvestment.
(2): Includes grants under the PSU Plan and, for Mr. Jackman, the closed Petro-Canada Performance Share Unit Plan (the "PCPSU Plan"). See "Summary of Incentive Plans – Closed Plans" on page 49 of this management proxy circular. Excludes grants that vested December 31, 2010, in the case of values reported for 2010, and grants that vested December 31, 2011, in the case of values reported for 2011.
(3): Includes grants under the RSU Plan and the closed SunShare 2012 Plan. Excludes grants that matured December 31, 2010, in the case of values reported for 2010, and grants that matured December 31, 2011, in the case of values reported for 2011.
(4): Mr. Williams elected to receive 54% of his 2009 AIP award and 100% of his 2010 AIP award in DSUs.
(5): Calculated based on the closing price of a Suncor common share on the TSX as at December 31, 2011 ($29.38). PSUs, which have not vested, are projected at a 100% payout. Value of options are based on the 'in-the-money' amount of the exercisable and non-exercisable options held as at December 31, 2011. The 'in-the-money' amount is the difference between the closing price of a Suncor common share on the TSX as at December 31, 2011 and the exercise price of the option.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 41

Summary Compensation Table. The following table provides information concerning compensation paid to the Named Executive Officers for the years ended December 31, 2011, 2010 and 2009.

					Non-equity incentive plan compensation ($)
Name and Position	Year	Salary ($)	Share-Based Awards ⁽¹⁾⁽²⁾ ($)	Option-Based Awards ⁽³⁾⁽⁴⁾ ($)	Annual ⁽⁵⁾	Long-Term	Pension Value ⁽⁶⁾ ($)		All Other Compensation ⁽⁷⁾ ($)	Total Compensation ($)


R.L. GEORGE	2011	1 483 846	4 596 111	4 596 445	3 060 000		941 200		180 216	14 857 818
Chief Executive Officer ⁽⁸⁾	2010	1 400 000	2 829 228	2 830 212	2 577 000	—	(772 100	)	198 330	9 062 670
	2009	1 301 269	2 578 017	1 166 200	1 800 000	—	2 831 500		180 641	9 857 627

B.W. DEMOSKY	2011	443 538	889 893	890 784	420 000		373 000		79 374	3 096 589
Chief Financial Officer	2010	401 327	415 638	415 800	360 000	—	311 000		27 919	1 931 684
	2009	302 731	421 228	154 350	191 475	—	244 400		52 708	1 366 892

S.W. WILLIAMS	2011	811 923	2 224 733	2 226 960	1 300 000	—	1 002 100		107 848	7 673 564
President &	2010	761 327	1 200 732	1 201 200	1 150 000	—	855 400		112 927	5 281 586
Chief Operating Officer ⁽⁸⁾	2009	685 961	1 516 180	557 375	758 746	—	1 300 200		103 959	4 922 421

B.J. JACKMAN	2011	750 000	1 001 130	1 002 132	1 000 000	—	180 700		89 169	4 023 131
Executive Vice President	2010	750 000	576 372	576 576	850 000	—	176 600		31 154	2 960 702
Refining and Marketing	2009	747 115	696 730	731 566	571 792	—	159 300		37 356	2 943 859

M.S. LITTLE	2011	492 731	1 112 367	1 113 480	610 000	—	594 200		92 568	4 015 346
Executive Vice President	2010	410 000	397 297	397 170	410 000	—	248 300		73 107	1 935 874
Oil Sands & In Situ ⁽⁹⁾	2009	335 385	384 253	154 300	296 232	—	211 200		50 868	1 432 288

(1)

For Messrs. George, Demosky, Williams and Little, includes PSUs and RSUs granted in 2009 under the PSU Plan, RSU Plan and closed SunShare 2012 Plan. For Mr. Jackman, includes PSUs granted in 2009 under the closed PCPSU Plan. For all Named Executive Officers, 2010 and 2011 include PSUs granted under the PSU Plan.

(2)

For share-based awards, the fair value of awards at grant date, as shown in the Summary Compensation table above, reflects the number of PSUs and RSUs awarded multiplied by the grant date fair value price calculated using Towers Watson's binomial valuation methodology. The HR&CC uses this methodology in making its decisions regarding incentive grants since it is applied consistently in its competitive market analyses.

Effective January 1, 2011, as a result of the company's adoption of International Financial Reporting Standards ("IFRS"), and for accounting purposes, PSUs are valued based on the Monte Carlo simulation methodology. For grants in 2010, accounting fair values have been restated to reflect this methodology. For grants in 2009, the methodology used to value PSUs and RSUs, for accounting purposes, is based on a mark-to-market valuation of a Suncor common share at the end of each financial quarter.

A summary of the grant date fair values calculated using Towers Watson's binomial valuation and key assumptions used under this methodology as well as the accounting fair values at the end of the financial quarter following the grant date and the variance between the values based on the two methodologies is provided below. Effective January 2013, Suncor expects to move to the accounting valuation methodology for disclosing the grant date fair value of share-based awards in the executive compensation disclosure. The variance between the grant date fair values and accounting fair values for each award is the result of a different methodology being applied to value the awards and the date the value is reported (grant date versus end of financial quarter).

	Towers Watson's Binomial Methodology Key Assumptions						Monte Carlo Simulation Methodology 2011 & 2010 Mark-to-Market Methodology 2009

Year and Plan	Grant Date Fair Value ($)	Term	Vesting	Performance Range %	Turnover	Dividend Reinvestment	Accounting Fair Value ($)	Variance to Grant Date Fair Value ($)


2011 - PSU Plan	33.40	3 years	Cliff	0 - 200	5%	Yes	40.82	7.42
2010 - PSU Plan	25.80	3 years	Cliff	0 - 200	5%	Yes	38.49	12.69
2009 - PSU Plan	18.13	3 years	Cliff	0 - 150	5%	No	28.14	10.01
2009 - PCPSU Plan	15.75	3 years	Cliff	0 - 150	5%	Yes	33.87	18.12
2009 - RSU Plan	21.07	3 years	Cliff	n/a	5%	n/a	28.14	7.07
2009 - RSU (merger related)	34.98	3 years	Cliff	n/a	5%	n/a	37.21	2.23
2009 - RSU (Sunshare 2012)	29.96	3 years	Cliff	n/a	5%	n/a	37.40	7.44

(3): For Messrs. George, Demosky, Williams and Little, 2009 includes options granted under the closed Suncor Executive Stock Plan (the "ESP") and closed SunShare 2012 Plan. For Mr. Jackman, 2009 includes options granted under the closed Petro-Canada Employee Stock Option Plan (the "PCSOP"). See "Summary of Incentive Plans – Closed Plans" on page 49 of this management proxy circular. For all Named Executive Officers, 2010 and 2011 include options granted under the SOP.
(4): For option-based awards, the fair value of awards at grant date, as shown in the Summary Compensation table above, reflects the number of options awarded multiplied by the grant date fair value price calculated using Towers Watson's binomial valuation methodology. The HR&CC uses this methodology in making its decisions regarding incentive grants since it is applied consistently in its competitive market analyses.

For accounting purposes, options, other than options granted under the closed PCSOP, are valued based on the Black Scholes methodology. For options granted under the closed PCSOP, the methodology used to value options is based on a mark-to-market valuation of a Suncor common share at the end of each financial quarter.

A summary of the grant date fair values calculated using Towers Watson's binomial valuation and key assumptions used under this methodology as well as the accounting fair values and the variance between the values based on the two methodologies is provided below. Effective January 2013, Suncor expects to move to the accounting valuation methodology for disclosing the value of option-based awards in the executive compensation disclosure. The variance between the grant date fair values and accounting fair values for each award is the result of a different methodology being applied to value the awards and, in the case of the PCSOP, the date the value is reported (grant date versus end of financial quarter).

	Towers Watson's Binomial Methodology Key Assumptions								Black Scholes Methodology 2011 & 2010 Mark-to-Market Methodology 2009

Year and Plan	Grant Date Fair Value ($)	Dividend Yield	Volatility	Term	Expected Life	Vesting	Risk-Free Rate (over term)	Turnover	Accounting Fair Value ($)	Variance to Grant Date Fair Value ($)


2011 - SOP	11.13	1.20%	34%	7 years	4.5 years	3 year ratable	0.3%-3.0%	5%	16.59	5.46
2010 - SOP	9.24	0.60%	28%	7 years	4.5 years	3 year ratable	3.7%-3.9%	5%	14.59	5.35
2009 - SOP	8.58	0.40%	29%	10 years	6 years	3 year ratable	3.7%-4.0%	5%	10.28	1.70
2009 - PCSOP	5.44	1.70%	33%	7 years	6 years	4 year ratable	3.7%-3.9%	5%	8.99	3.55

(5): Awards earned under AIP for 2011 performance were paid in 2012. Similarly, awards for 2010 and 2009 were paid in the year following the year in which they were earned.

42 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

(6): The pension value reflects the compensatory change as disclosed in the tables under the "Defined Benefits Plans" and, where applicable, the "Defined Contribution Plans" sections on page 45 of this management proxy circular.
(7): All Other Compensation for 2011 includes actual costs incurred by Suncor related to company contributions to personal savings plans, all gross-ups or other amounts reimbursed for the payment of taxes and the value of perquisites and other personal benefits provided to each NEO, as more particularly described in the table below.

$	Annual Perquisite Allowance	Executive Benefits	Financial Planning	Leased Vehicle	Memberships	Other	Parking	Saving Plan	All Other Compensation


R.L. GEORGE	—	11 573	24 169	26 430	3 329	—	6 615	108 100	180 216
B.W. DEMOSKY	37 917	2 313	6 300	—	—	—	—	32 844	79 374
S.W. WILLIAMS	43 333	6 367	5 788	—	—	—	—	52 360	107 848
B.J. JACKMAN	37 917	4 158	13 008	—	—	—	—	34 086	89 169
M.S. LITTLE	37 917	2 952	12 087	—	—	4 156	—	35 456	92 568

: Executive Benefits includes enhanced life insurance, accident and disability protection. Annual Perquisite Allowance includes a taxable benefit paid quarterly based on executive level and market competitive practices. Other includes gross-ups for taxes associated with Suncor's Sunjet. Savings Plan includes Suncor contributions, up to 7.5% of basic earnings on a matching basis, to the company's savings and benefit plans on behalf of the individual.
(8): Effective December 1, 2011, Mr. George retired from the position of President and Mr. Williams was appointed President.
(9): Effective January 1, 2012, Mr. Little was appointed to Executive Vice President, Oil Sands and In Situ. In 2011, Mr. Little was Executive Vice President, Oil Sands from January 31, 2011 and Senior Vice President, International and Offshore prior to that date.

Share-Based Awards and Option-Based Awards. The following table provides certain information about option-based awards and shared-based awards outstanding for the Named Executive Officers as at December 31, 2011. For further details, including the exercise price and expiration date, of each option-based award held by the Named Executive Officers as at December 31, 2011, see Schedule B.

	Option-Based Awards		Share-Based Awards
Name	Aggregate number of securities underlying unexercised options	Aggregate value of unexercised 'in-the- money' options ⁽¹⁾ ($)	Aggregate number of shares or units of shares that have not vested ⁽²⁾	Aggregate market or payout value of share-based awards that have not vested ⁽³⁾ ($)	Aggregate market or payout value of vested share- based awards not paid out or distributed ⁽⁴⁾ ($)


R.L. GEORGE	3 049 100	24 063 680	258 393	7 591 576	16 740 039
B.W. DEMOSKY	225 736	48 800	45 318	1 331 449	635 675
S.W. WILLIAMS	964 000	3 911 700	119 020	3 496 818	3 127 935
B.J. JACKMAN	855 600	4 590 476	99 949	2 936 502	3 620 607
M.S. LITTLE	228 620	209 440	51 839	1 523 041	550 793

(1): Calculated based on the difference between the closing price of a Suncor common share on the TSX as at December 31, 2011 ($29.38) and the exercise price of the option. This value assumes 100% vesting of all performance-based options granted under the closed SunShare 2012 Plan.
(2): Includes share-based awards granted under the PSU Plan, closed SunShare 2012 Plan and closed PCPSU Plan which were held by the Named Executive Officers as at December 31, 2011. For Messrs. George, Demosky, Williams and Little, excludes RSUs and PSUs issued in 2009 that matured and vested respectively on December 31, 2011.
(3): Calculated based on the closing price of a Suncor common share on the TSX as at December 31, 2011 ($29.38). This assumes 100% payout of all PSUs granted under the PSU Plan and closed PCPSU Plan.
(4): Calculated based on the closing price of a Suncor common share on the TSX as at December 31, 2011 ($29.38). Includes DSUs granted under the closed Suncor Special Performance Incentive Plan ("SPIP") and the closed Petro-Canada Deferred Share Unit Plans (Eligible Employees of Petro-Canada) (the "PCDSU Plans") which were held by the Named Executive Officers as at December 31, 2011. See "Summary of Incentive Plans – Closed Plans" on page 49 of this management proxy circular. DSUs cannot be redeemed until a Named Executive Officer ceases to be an employee. For Messrs. George, Demosky, Williams and Little, includes: (i) RSUs issued in 2009 under the RSU Plan that matured on December 31, 2011 and paid out in January 2012; and (ii) PSUs issued in 2009 under the PSU Plan that vested on December 31, 2011 and paid out in February 2012.

Incentive Plan Awards – Value Vested or Earned During the Year. The following table provides the value of option-based awards and share-based awards that vested during the year ended December 31, 2011, and the value of non-equity incentive plan compensation earned during the year ended December 31, 2011, for the Named Executive Officers.

Name	Option-Based awards – Value vested during the year (as at vesting date) ⁽¹⁾ ($)	Share-Based awards – Value vested during the year ⁽²⁾ ($)		Non-equity incentive plan compensation – Value earned during the year ⁽³⁾ ($)


R.L. GEORGE	1 281 206	4 162 865		3 060 000
B.W. DEMOSKY	179 130	635 675		420 000
S.W. WILLIAMS	577 189	3 139 957	⁽⁴⁾	1 300 000
B.J. JACKMAN	1 465 168	1 295 325		1 000 000
M.S. LITTLE	231 644	550 793		610 000

(1): For Messrs. George, Demosky, Williams and Little, one-third of each of the options that were granted under the closed ESP in 2008 and 2009 vested in 2011. For Mr. Jackman, one quarter of each of the options that were granted under the closed PCSOP in 2007, 2008, and 2009 vested in 2011. For all Named Executive Officers, one-third of each of the options that were granted under the SOP in 2010 vested in 2011.
(2): For Messrs. George, Demosky, Williams and Little, includes RSUs issued in 2009 under the RSU Plan that matured on December 31, 2011 and paid out in January 2012. For Messrs. George, Demosky, Williams and Little, includes PSUs issued in 2009 under the PSU Plan that vested on December 31, 2011 and paid out in February 2012. For Mr. Jackman, includes PSUs issued in 2008 under the closed PCPSU Plan that vested on February 23, 2011 and paid out in March 2011. Value based on actual payout.
(3): Refers to annual incentive payouts made under the AIP that paid out in February 2012, for recognition of performance in 2011.
(4): Includes DSUs issued to Mr. Williams under the AIP upon his election, in lieu of a cash award. Value based on grant price.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 43

Option Exercises – Value Realized During the Year. The following table provides the number of common shares acquired upon the exercise of options as well as the aggregate value realized upon the exercise of these options during the year ended December 31, 2011 for the Named Executive Officers.

Name	Common Shares Acquired on Option Exercise	Aggregate Value Realized ⁽¹⁾ ($)


R.L. GEORGE	230 000	7 354 999
B.W. DEMOSKY	8 000	174 160
S.W. WILLIAMS	180 000	3 000 980
B.J. JACKMAN	111 800	2 423 143
M.S. LITTLE	—	—

(1): The aggregate value realized equals the difference between the value of the option and the market price of the common shares on the TSX at time of exercise.

Suncor Retirement Arrangements. The Suncor Energy Pension Plan is a registered pension plan that provides retirement income to Suncor employees, including Messrs. George, Demosky, Williams and Little. Retirement income is based entirely on a defined contribution account balance, or depending upon the employees' eligibility, based on a combination of a defined benefit pension payment, including an employee-paid benefit feature, and a defined contribution account balance. Messrs. George, Demosky, Williams and Little participate in the combination provision of the plan.

In addition to the pension provided under the Suncor Energy Pension Plan, certain executive officers may receive supplemental retirement payments under the terms of the Supplemental Executive Retirement Plan (previously defined as the "SERP"). Under the terms of the SERP, any new participants must be approved by the HR&CC, a committee which consists entirely of independent members of the Board.

The SERP is a non-registered supplemental retirement arrangement designed to attract mid-career executives with a competitive career-based pension that features an up-front accrual. This attraction element is balanced by features that limit the executive pension by: a) requiring that an executive provide five years of service to be entitled to SERP benefits, which is three years more than the service required under the Suncor Energy Pension Plan; b) limiting service to Suncor-related experience only, both for vesting and benefit accrual purposes; c) effective January 1, 2012, limiting the executive's total pension to 70% of executive remuneration; and d) effective January 1, 2012, limiting executive remuneration to a maximum of two times base salary (base salary plus annual incentive target bonus of up to 100% of base salary). All of the Named Executive Officers, with the exception of Mr. Jackman, are members of the SERP. Additional details of the SERP follow.

•: Executive employment commences at the date of entry into the SERP. Generally, there is no recognition of service for non-Suncor related employment.
•: The SERP pension is based on the executive's remuneration multiplied by a combined accrual rate of 5%, multiplied by the number of years of executive employment plus a pension formula percentage determined in respect of the Suncor Energy Pension Plan relating to service prior to becoming an executive, limited to a combined accrual rate of 50%. The pension increases by an additional 1.5% of the executive's remuneration for executive employment earned, generally after the executive completes 25 years of service. Effective January 1, 2012, the total pension is limited to 70% of the executive's remuneration, as described below.
•: Executive remuneration is an annualized amount of the average salary plus target bonus for the best consecutive 36 months of the last 180 months of continuous service. Effective January 1, 2012, target bonus, other than as grandfathered for Mr. George, cannot exceed 80% of base salary for Senior Vice Presidents and Executive Vice Presidents and 100% for other executives, including the CEO.
•: Five years of executive employment including, where applicable, the period of notice of termination or payment in lieu of such notice, are required for rights under the SERP to vest. Executive officers with less than five years of executive employment are not eligible to receive supplemental retirement payments under the SERP except in the event of a change of control, or a loss of employment upon or after the occurrence of certain specified events.
•: SERP payments for retirement prior to age 60 will be reduced by ⁵ / ₁₂ ^th of 1% for each month that the executive officer retires before age 60; no reduction is applied for retirement after age 60.
•: The normal form of payment on retirement, and the basis on which benefits in the table under "Defined Benefit Plans" are computed is: for married employees, joint and survivor, with 50% to the non-member surviving spouse; and for single employees, for life, with ten years guaranteed.
•: A portion of retirement income is payable by the Suncor Energy Pension Plan, including both the defined benefit and defined contribution components, and a portion is payable under the SERP. Canada Pension Plan payments are in addition to payments under the Suncor pension plans.
•: Trust arrangements have been established to provide for the long-term funding of Suncor's non-U.S. taxpayer SERP obligations.

44 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Petro-Canada Retirement Arrangements. The Petro-Canada Retirement Plan is a registered pension plan that provides retirement income to certain Suncor employees who worked for legacy Petro-Canada prior to the merger, including Mr. Jackman. The defined benefit provision of the plan has been closed to new entrants since July 1, 1996. Mr. Jackman continues to participate in this portion of the plan.

In addition to his pension under the Petro-Canada Retirement Plan, Mr. Jackman is also entitled to receive supplemental retirement payments under the terms of his individual retiring allowance agreement. Under his retiring allowance agreement, the normal retirement benefit for Mr. Jackman equals 2% per year of credited service to a maximum of 35 years, multiplied by the average of the highest 36 consecutive months of base salary in the final 120 months of service. At age 65, the benefit is reduced by an adjustment equal to 50% of the total of Canada/Quebec Pension Plan plus Old Age Security benefits, pro-rated for years of service less than 35.

Early retirement under Mr. Jackman's individual retirement allowance agreement requires our consent for commencement before age 65. In the event of early retirement, the normal retirement benefit is reduced by 0.25% for each month that the executive officer retires before age 60; no reduction is applied for retirement after age 60. Normal and early retirement benefits are indexed annually for Mr. Jackman to 50% of the consumer price index, commencing after age 60, subject to a maximum indexing adjustment of 5% for any year. The normal form of payment on retirement for Mr. Jackman, if married, is joint and survivor, with 50% to the non member surviving spouse subject to a minimum of 60 monthly payments. Mr. Jackman's pension obligation is secured by a letter of credit held by a trust.

Defined Benefit Plans. The following table summarizes the retirement income of each of the Named Executive Officers under the defined benefit provisions of Suncor's pension arrangements.

		Annual Benefits Payable ⁽²⁾
Name	Number of years credited service ⁽¹⁾	As at December 31, 2011 ($)	At age 65 ($)	Defined Benefit Obligation as at January 1, 2011 ⁽³⁾ ($)	Compensatory change ⁽⁴⁾ ($)	Non- compensatory change ⁽⁵⁾ ($)	Defined Benefit Obligation as at December 31, 2011 ⁽³⁾ ($)


R.L. GEORGE	31	1 703 359	1 854 562	22 107 011	939 574	3 606 757	26 653 342
B.W. DEMOSKY	6	107 773 ⁽⁶⁾	294 799	863 314	371 374	386 625	1 621 313
S.W. WILLIAMS	10	687 071	709 749	7 992 337	1 000 474	1 945 652	10 938 463
B.J. JACKMAN	29	426 800	449 000	6 564 700	180 700	472 500	7 217 900
M.S. LITTLE	3	104 551 ⁽⁶⁾	334 767	583 447	591 864	439 442	1 614 753

(1): Credited service includes 11 years of service with an affiliated Suncor company for determining the additional 1.5% accrual rate applicable after 25 years of service for Mr. George and 10 years of industry service granted to Mr. Jackman at date of hire. For Mr. Demosky, credited service reflects executive employment plus 3 years of service accrued under the Suncor Energy Pension Plan prior to becoming an executive.
(2): Represents the estimated annual pension, excluding any employee paid ancillary benefits, where applicable, that would be received by the Named Executive Officer upon retirement at age 65 based on actual or projected pensionable service to the stated date and actual pensionable earnings as at December 31, 2011.
(3): The defined benefit obligation is the estimated value of the pension obligation to the date indicated using the actuarial assumptions and methods that are consistent with those used in determining the pension obligation as disclosed by Suncor in its consolidated financial statements. See note 24 in Suncor's consolidated financial statements for the year ended December 31, 2011. The methods and assumptions used to determine the estimated amounts may not be identical to those used by other companies and as a result may not be directly comparable to the amounts disclosed by other companies.
(4): Compensatory change represents the increase in the pension obligation for 2011 related to the annual service cost, compensation changes higher or lower than assumptions and the impact of plan changes, if any. This amount may fluctuate significantly from year-to-year as changes in compensation impact the pension obligation for all years of credited service.
(5): Includes items such as interest on the obligation and the impact of changes in the discount rate assumption.
(6): For Messrs. Demosky and Little, the amount represents the total pension accrued under SERP. Only a portion of this benefit relating to the registered and supplemental plans is vested as at December 31, 2011.

Defined Contribution Plans. Under the combination provision of the Suncor Energy Pension Plan, applicable to Messrs. George, Demosky, Williams and Little, Suncor makes contributions to the defined contribution accounts for all employees of 1% of basic earnings, plus up to an additional 1.5% of basic earnings on a 50% matching basis, subject to maximum contribution levels. For employees participating only in the defined contribution provision, Suncor makes contributions to the defined contribution accounts of 5% to 9% of basic earnings depending upon years of service with the company, plus up to an additional 2.5% of basic earnings on a 50% matching basis, subject to maximum contribution levels.

Under the Suncor Energy Pension Plan, employees may invest the balance of their accounts in a broad range of investment funds made available by the plan; an employee's investment return is based upon the market returns earned by each fund in which the employee has chosen to invest his contributions. At retirement, employees may transfer the balance of their accounts to a pension account as prescribed by law or the company may purchase an annuity on behalf of the employee.

The following table summarizes the defined contributions accounts of each of the Named Executive Officers.

Name	Accumulated value as at January 1, 2011 ($)	Compensatory ($)	Accumulated value as at December 31, 2011 ($)


R.L. GEORGE	42 424	1 626	42 347
B.W. DEMOSKY	21 363	1 626	21 337
S.W. WILLIAMS	16 275	1 626	19 469
M.S. LITTLE	12 371	2 336	16 380

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 45

TERMINATION AGREEMENTS AND CHANGE OF CONTROL ARRANGEMENTS

Termination Agreements. Suncor has employment termination agreements with each of the Named Executive Officers. Except for Mr. Jackman, such individuals are compensated based on their remuneration, in the event of termination of employment ("Termination Event") by Suncor, other than for just cause, and by the individual within 120 days following a constructive dismissal event.

Should a Termination Event occur, the termination agreements provide a 24-month notice period ⁽¹⁾ for Messrs. Demosky, Williams ⁽²⁾ and Little, and a 30-month notice period for Mr. George. Cash payments are provided for base salary and targeted annual incentive during the notice period, for SOP and ESP options which, but for the Termination Event, would have become exercisable during the notice period, and for PSUs and RSUs that would pay out during the notice period based on a performance factor calculated as at the date of termination, if applicable. Unless the individual is an eligible retiree, unvested options and share units granted under the SunShare 2012 Plan are, respectively, cancelled and forfeited. The foregoing individuals receive credited service under the SERP for the notice period.

Upon a Termination Event occurring, the notice period for Mr. Jackman is the lesser of 30 months or 65 minus his age at the time of the Termination Event ⁽³⁾ . A lump sum payment is provided equal to his base salary as of the date of termination and annual incentive over the notice period and the value of his mid- or long-term incentives, which are equal to the lesser of the value of the grant of options to him in February 2000 and the value of the options granted to him in 2001, and in each successive year thereafter. For the purpose of calculating Mr. Jackman's retirement benefit, service is increased by the notice period and he is deemed to have earned the base salary as of the termination date for the duration of the notice period.

Suncor's termination agreements with Messrs. George, Demosky, Williams and Little are "double trigger" and do not provide for payments based solely on a voluntary termination on a change of control. Stock options under the SOP, ESP, Suncor Key Contributor Stock Option Plan (the "SKCSO Plan") and SunShare 2012 Plan (collectively, the "Suncor Plans"), that are granted but not yet exercisable, become immediately exercisable in the event of a change of control of Suncor, for grants that occurred prior to 2012. In addition, PSUs and RSUs that were granted prior to 2012 will vest in the event of a change of control subject to Suncor performance measured at the change of control date. Under the SOP, a change of control generally includes a transaction or series of transactions whereby any person or combination of persons, acting jointly or in concert, beneficially owns, directly or indirectly, or exercises control or direction over, 35% or more of the outstanding voting securities of Suncor or its successor.

Executive officers with less than five years of executive service may become eligible to receive supplemental retirement payments under the SERP in the event of a change of control of Suncor, after the occurrence of certain specified corporate changes, or for certain executives, after a substantial decrease in such executive's responsibilities. In addition, Suncor has entered into certain trust arrangements for non-U.S. taxpayers to secure its obligations under the SERP upon a change in control of Suncor.

Mr. Jackman does not have a change of control clause in his termination contract. Pursuant to the terms of the SOP and PSU Plan, under a change of control, Mr. Jackman's 2010 and 2011 stock options would become immediately exercisable and Mr. Jackman's 2010 and 2011 PSUs would vest subject to performance measurement at the change of control date.

(1): Effective 2008, the notice period provided in new employment termination agreements was limited to 24 months.
(2): The notice period for Mr. Williams was amended to 24 months with his appointment to President on December 1, 2011.
(3): Based on Mr. Jackman's age at December 31, 2011, and assuming a Termination Event at this date, his notice period is less than 24 months.

Looking Ahead to 2012

The Board has approved amendments to the SOP, PSU Plan and RSU Plan that will require a "double trigger" for automatic vesting of equity grants on a change of control, effective for grants on or after January 1, 2012.

The HR&CC has approved amendments to termination agreements for new senior executive participants that provide for the pro-rating of payments for PSU and RSU grants held at the dismissal date, based on the number of months employed during the term of the PSU or RSU grant.

With the retirement of Mr. George in 2012, the notice period for all employment termination agreements is 24 months.

Limited Appreciation Rights. Executives, including the Named Executive Officers, key employees and certain Board members (who hold stock options prior to grants to directors being discontinued after 2008), have LARs attached to their options issued under the Suncor Plans. LARs provide the holders an opportunity to realize the value, if any, of their options under the Suncor Plans upon occurrence of a change of control transaction (as explained above) affecting Suncor. In that circumstance, option holders may be unable to exercise their options prior to completion of a change of control transaction due to securities regulatory requirements or internal Suncor policies.

46 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

LARs represent a right attached to each option held by the LAR holder, exercisable upon completion of a change of control transaction, to receive a cash payment from Suncor under a pre-determined formula based on Suncor's share price, upon surrender of a related option.

LARs are generally issued annually at Suncor's discretion, have an 18-month term (unless a replacement LAR is issued, in which case the LAR continues in effect under the terms of the replacement LAR), and attach to all options granted under the Suncor Plans held by the holder during the term of the LAR. Upon the exercise or expiry of any option, the attached LAR is cancelled.

Generally, LARs terminate and are of no further effect upon termination of employment, retirement, death or entitlement to long-term disability benefits. However, the Board has the discretion to permit the exercise of LARs in the manner and on such terms as it may authorize.

Termination and Change of Control Benefits

The table below shows the incremental amounts that the Named Executive Officers would be entitled to if any of them were terminated on December 31, 2011.

Type of Termination	Base Salary ($)	Short-Term Incentive ⁽¹⁾ ($)	Long-Term Incentive ⁽²⁾ ($)	Pension ($)	Total Payout ($)


R.L. GEORGE
Resignation	—	—	375 062	—	375 062
Retirement	—	—	375 062	—	375 062
Termination (Without Cause)	3 750 000	4 687 500	375 062	5 686 115	14 498 677
Change of Control ⁽³⁾	3 750 000	4 687 500	7 812 801	5 686 115	21 936 416
Change of Control ⁽⁴⁾	—	—	7 812 801	—	7 812 801

B.W. DEMOSKY
Resignation	—	—	—	—	—
Retirement ⁽⁵⁾	—	—	—	—	—
Termination (Without Cause)	900 000	540 000	1 307 845	1 227 362	3 975 207
Change of Control ⁽³⁾	900 000	540 000	1 360 729	1 227 362	4 028 091
Change of Control ⁽⁴⁾	—	—	1 360 729	513 223	1 873 952

S.W. WILLIAMS
Resignation	—	—	195 670	—	195 670
Retirement ⁽⁵⁾	—	—	195 670	—	195 670
Termination (Without Cause)	1 640 000	1 640 000	195 670	1 743 902	5 219 572
Change of Control ⁽³⁾	1 640 000	1 640 000	3 602 553	1 743 902	8 626 455
Change of Control ⁽⁴⁾	—	—	3 602 553	—	3 602 553

B.J. JACKMAN
Resignation	—	—	—	—	—
Retirement	—	—	—	—	—
Termination (Without Cause)	1 125 000	1 210 896	380 358	—	2 716 254
Change of Control ⁽³⁾ ⁽⁶⁾	1 125 000	1 210 896	1 945 778	—	4 281 674
Change of Control ⁽⁴⁾	—	—	1 565 420	—	1 565 420

M.S. LITTLE
Resignation	—	—	—	—	—
Retirement ⁽⁵⁾	—	—	—	—	—
Termination (Without Cause)	1 000 000	750 000	1 484 747	1 691 786	4 296 533
Change of Control ⁽³⁾	1 000 000	750 000	1 552 321	1 691 786	4 994 107
Change of Control ⁽⁴⁾	—	—	1 552 321	690 301	2 242 622

(1): Short-Term Incentives include incremental annual bonus entitlement.
(2): Long-Term Incentives include the incremental value of the aggregate outstanding option-based and share-based awards held and 'in-the-money' that vest as a result of the termination.
(3): Assumes involuntary termination on change of control.
(4): Assumes continued employment or voluntary termination on change of control. In the case of pension, only applies to Messrs. Demosky and Little as each have less than five years of executive service resulting in vesting of SERP benefits.
(5): Messrs. Demosky and Little are not eligible for retirement as of December 31, 2011. Mr. Williams became retirement eligible effective February 5, 2011.
(6): Amounts for Mr. Jackman include long-term incentive treatment under a change of control for grants after 2009.

INDEBTEDNESS OF DIRECTORS, EXECUTIVE OFFICERS AND SENIOR OFFICERS

None of the directors, executive officers or senior officers of Suncor, persons who served as directors, executive officers or senior officers at any time during 2011, or their respective associates, were at any time during the year, excluding routine indebtedness, indebted to Suncor or its subsidiaries, either in connection with the purchase of Suncor securities or otherwise.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 47

SUMMARY OF INCENTIVE PLANS

The following table sets forth information in respect of securities authorized for issuance under our equity compensation plans as at December 31, 2011.

	Number of securities to be issued upon exercise of outstanding options (a)	Weighted-average exercise price of outstanding options ($)	Number of securities remaining available for future issuance under option plans (excluding securities reflected in column (a))


Equity compensation plans approved by security holders	53 552 649	35.25	10 347 098
Equity compensation plans not approved by security holders	5 625 500	41.15	–

Total	59 178 149	35.81	10 347 098

The numbers shown beside "Equity compensation plans approved by security holders" refer to options granted under the SOP, ESP, the SunShare Performance Stock Option Plan (the "SPSO Plan"), the PCSOP and the SunShare 2012 Plan. The numbers shown beside "Equity compensation plans not approved by security holders" refer to the SKSCO Plan.

Suncor Energy Stock Option. The Suncor Energy Stock Option Plan (previously defined as the "SOP") provides for the grant of options to purchase Suncor common shares, as well as the grant of Stock Appreciation Rights ("SARs") and LARs, to eligible employees of Suncor.

Options entitle the holder to purchase shares at a price not less than the Market Value (as defined below) of the shares on the date of grant. Where SARs are granted on a stand alone basis, each SAR entitles the holder to receive, upon exercise, payment equal to the difference between the Market Value of a share on exercise and the Market Value of a common share on the date of grant. The options and SARs generally have a term of seven years. A tandem SAR, which may be granted with an option, entitles the holder to receive, upon exercise, a payment equal to the difference between the Market Value of a Suncor common share on exercise and the exercise price of the related option. The "Market Value" under the SOP is the simple average of the high and low prices at which shares were traded in one or more board lots on the TSX on the day prior to the grant date or exercise date, as the case may be. Due to legislative changes in 2010 under the Income Tax Act (Canada), Suncor no longer grants SARs or tandem SARs to Canadian employees.

Performance Share Unit Plan. PSUs may pay out at a value between 0% and 200% contingent upon Suncor's performance relative to a peer group of companies over a three year period. The peer group is chosen based on size and business scope criteria approved by the HR&CC. The peer group for grants beginning in 2010 includes North American energy companies. The peer group is adjusted as appropriate and approved by the HR&CC for each annual grant. The peer group for 2010 and 2011 PSU grants, along with other information about the peer group, is displayed below.

Peer	Revenue ⁽¹⁾ (Billions) ($)	Market Capitalization ⁽²⁾ (Billions) ($)	Assets ⁽¹⁾ (Billions) ($)


Anadarko Petroleum Corporation	10.7	38.6	55.1
Apache Corporation	12.9	35.4	49.3
BP p.l.c.	293.0	138.2	302.0
Canadian Natural Resources Ltd.	9.6	41.8	45.5
Cenovus Energy Inc.	11.4	25.5	21.4
Chevron Corporation	187.0	215.4	212.0
ConocoPhillips	185.0	98.4	160.7
Devon Energy Corporation	8.2	25.5	41.4
Encana Corporation	6.2	13.9	36.0
EOG Resources Inc.	6.7	26.9	25.8
Hess Corporation	29.9	19.3	38.8
Husky Energy Inc.	18.3	23.5	31.7
Imperial Oil Ltd.	21.5	38.5	24.2
Marathon Oil Corporation	11.5	20.9	31.7
Occidental Petroleum Corporation	18.6	77.3	59.5
Royal Dutch Shell	368.4	238.2	361.0
Talisman Energy Inc.	6.4	13.4	24.3
Total S.A.	172.6	117.6	219.3

48 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Distribution	Revenue ⁽¹⁾ (Billions) ($)	Market Capitalization ⁽²⁾ (Billions) ($)	Assets ⁽¹⁾ (Billions) ($)


25 ^th percentile	9.9	24.0	31.7
Median	15.6	37.0	43.5
75 ^th Percentile	136.9	93.1	135.4


Suncor	29.7	46.3	74.5
Suncor Percentile Ranking	67 ^th	67 ^th	72 ^nd

(1): Percentile rank for Revenue and Assets is based on results reported as of September 30, 2011. Where applicable, results are converted to Canadian dollars based on the exchange rate on September 30, 2011.
(2): Percentile rank for Market Capitalization is based on results reported as of December 31, 2011. Where applicable, results are converted to Canadian dollars based on the exchange rate on December 31, 2011.

Performance and the corresponding payout, if any, is measured by reference to Suncor's TSR relative to its peer group. The PSU Plan was amended in 2009 to provide for notional dividend reinvestment for awards granted after January 1, 2010.

Vesting for 2010 and 2011 grants of PSUs reward performance between the 25th and 100th percentiles of the peer group identified above as follows.

Percentage of PSUs Vesting at End of Three-Year Performance Period		Total Shareholder Return Performance Period Compared to Peer Group


Nil		Suncor TSR less than the 25th percentile of the peer group.
50% to 200% ⁽¹⁾		Suncor TSR greater than or equal to the 25th percentile.

(1): Payout is based on actual interpolated position between the 25th percentile and the top performing company.

At the end of the three-year performance period, relative TSR is measured, the payout value is determined and, if applicable, subsequently paid to participants in cash. The final value is based on the number of vested PSUs multiplied by the common share price as determined under the PSU Plan provisions.

PSUs do not count towards the assessment of executive share ownership levels for purposes of the share ownership guidelines. Upon payout, executives must use the cash payout, or other cash resources, to purchase Suncor common shares on the open market toward satisfying any unmet share ownership guidelines.

Restricted Share Unit Plan. The RSU Plan was established in January 2009 by the HR&CC. RSUs may be granted to key employees, senior managers and executives of Suncor as part of their competitive compensation in order to increase the retention aspects of the overall equity programs, as well as to further align participants with shareholder interests.

Each RSU is a right to a cash payment, equivalent in value to one Suncor common share based on the value of Suncor's average share price for the last 20 trading days of the restricted period. Awards under the RSU Plan are administered by the HR&CC. RSUs do not not count towards the assessment of executive share ownership levels for purposes of the share ownership guidelines. The RSU Plan was amended in 2009 to provide for notional dividend reinvestment for grants after January 1, 2010.

Closed Plans. The following table provides the key terms of the Suncor equity based plans that are closed to new grants (the "Suncor Closed Plans").

Year Approved	Plan Name ⁽¹⁾	Award Type ⁽²⁾	No. Outstanding at February 21, 2012 (% of outstanding shares)	Balance Allocated to SOP Aug. 1, 2009	Vesting Schedule	Expiry ⁽³⁾	Performance Conditions


1992	Suncor Executive Stock Plan (ESP)	Option	5 528 175 (0.35%)	2 168 732	¹ / 3 per yr over 3 yrs	10 years	No
1997	Suncor Special Performance Incentive Plan (closed March 31, 2002) (SPIP)	DSU	779 117	—	—	—	No
1997	Petro-Canada Restricted Share Unit Plan (Non-Employee Directors of Petro-Canada) (closed Dec. 31, 2003) (PCRSU)	RSU	39 287	—	—	—	No
2000	Petro-Canada Deferred Share Unit Plans (Eligible Employees of Petro-Canada) (PCDSU) ⁽⁴⁾	DSU	236 206	—	—	—	No

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 49

Year
Approved

Plan Name ⁽¹⁾

Award
Type ⁽²⁾

No. Outstanding
at February 21, 2012
(% of outstanding
shares)

Balance
Allocated to
SOP Aug. 1,
2009

Vesting
Schedule

Expiry ⁽³⁾

Performance
Conditions

2002

Suncor SunShare Performance Stock Option Plan (SPSO)

Option

7 847 657
(0.50%)

—

Vested

⁽⁵⁾

April 29, 2012

Yes ⁽⁶⁾

2004

Petro-Canada Performance Share Unit Plan (PCPSU)

PSU

195 025

—

3 yrs

February 23, 2012

Yes ⁽⁷⁾

2004

Petro-Canada Employee Stock Option Plan (PCSOP)

Option

14 620 505
(0.94%)

6 063 015

¹ / 4 per yr over 4 yrs

7 years

2004

Suncor Key Contributor Stock Option Plan (SKCSO)

Option

5 539 119
(0.35%)

2 094 650

¹ / 3 per yr over 3 yrs

10 years

2004

Petro-Canada Deferred Share Unit Plan (Non-Employee Directors of Petro-Canada) (PCCDSU) ⁽⁸⁾

DSU

81 675

—

2007

Suncor SunShare 2012 Plan (SunShare 2012 Plan)

Option

12 645 027
(0.81%)

5 615 984

Share Price and TSR Targets

⁽⁹⁾

September 27, 2014

Yes ⁽¹⁰⁾

RSU

761 290

—

July 31, 2012

—

2007

Petro-Canada Stock Appreciation Rights Plan (PCSAR) ⁽¹¹⁾

SAR

8 249 413

—

¹ / 4 per yr over 4 yrs

7 years

2008

Petro-Canada Resticted Share Unit Plan (Eligible Employees of Petro-Canada)

RSU

611 873

—

3 yrs

February 23, 2012

(1): All plans closed effective August 1, 2009, unless otherwise noted.
(2): Option grants may include associated LARs.
(3): Period of time from grant date until maximum expiry. Where no period indicated, maximum expiry is same as vesting schedule.
(4): Includes two DSU plans. The first allowed eligible employees (as that term is defined in the plan) to elect to have their bonus payable in the next calendar year in DSUs. The second allowed eligible employees (as that term is defined in the plan) to receive DSUs at the discretion of the Management Resources and Compensation Committee of Petro-Canada.
(5): 100% of options vested in recognition of the performance criteria described in footnote 6.
(6): The performance criteria for maximum vesting included achievement of Suncor-wide targets for return on capital employed ("ROCE") with maximum vesting at 15% average annual ROCE over the 2003 to 2008 period, and a doubling of share price from the $13.82 grant price by April 2008 (achieved June 2005). The interim targets, namely the achievement of a 40% rise in share price concurrent with TSR superior to the TSR of the S&P 500, and the achievement of 15% ROCE for 2003 to 2004, were achieved on October 5, 2004 and December 31, 2004 respectively.
(7): PSUs under the PCPSU are a form of mid-term incentive that rewards participants for performance against specific performance standards. The Management Resources and Compensation Committee used its discretion to select and attach performance standards to PSUs. Relative TSR is the measure that was employed from 2004.
(8): Members (as that term is defined in the plan) could elect to have all or a portion of their annual board retainer and meeting fees in DSUs.
(9): On May 12, 2008, the first of two share price targets under the SunShare 2012 Plan was achieved. See footnote 10 for details.
(10): The performance criteria include aggressive share price and TSR targets that align employee performance with shareholders' interests. Specifically, the performance criteria for 100% vesting of the SunShare 2012 options include two common share price targets and relative TSR performance in the top quartile among a peer group of companies. TSR is a measure of return on investment that includes both capital gains and dividends over the measurement period.
(11): The PCSAR Plan provides a cash payment to participants equal to the appreciation in share price between the date the SARs were granted and the date the SARs are exercised. All SARs are non-transferable and non-assignable, and exercisable on terms determined by the HR&CC in its discretion at the time the SARs were granted. The exercise price per SAR cannot be less than the closing price of the common shares on the TSX on the day preceding the day the SAR was granted.

Aggregate Potential Dilution. The aggregate potential dilution of all issued, outstanding and authorized options under Suncor stock option plans was 4.2% at February 21, 2012. Suncor has no other equity compensation plans involving newly issued securities.

2011 Grant Rate (Run Rate): Stock options granted under the SOP plan in 2011 of 5 839 710 totaled less than 1% (approximately 0.4%) of shares outstanding at the end of 2011.

Additional Terms of Equity Compensation Plans:

•: The SOP, SunShare 2012 Plan and ESP contain an amendment provision providing that the Board may amend, modify or terminate the plans if and when it is advisable at the discretion of the Board without shareholder approval except for those amendments specifically requiring shareholder approval as mandated by the respective plans including: (a) an increase in the number of securities reserved under the plans; (b) a reduction in an exercise price, or cancellation and reissue of options which benefits any option holder (other than as may be permitted by the TSX); (c) an amendment that extends the term of an award beyond its original expiry; (d) allowing awards granted under the plans to be transferable or assignable other than for normal estate settlement purposes; and (e) any amendment that increases the maximum number of options available for annual grants to non-employee directors.
•: The PCSOP contains an amendment provision providing that the HR&CC may amend the plan: (a) to make formal, minor or technical modifications to any of the provisions; (b) to change any of the provisions provided the change is not materially prejudicial to the interests of the option holders; or (c) to correct any ambiguity, defective provisions, error or omissions in the provisions of the plan provided that the rights of the option holders are not prejudiced by the correction. Subject to the obtaining of any required regulatory or other approvals, any other amendment is only effective after it has been approved by option holders, in accordance with the plan.

50 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

•: No one person or company is entitled to receive more than 5% of the common shares reserved for issuance on exercise of the options available for grant under the SOP and the Suncor Closed Plans.
•: All or any portion of an option, or LAR granted under any of the ESP, SPSO, SKCSO and SunShare 2012 Plan (collectively, the "Legacy Suncor Plans"), or any entitlement to receive an option or LAR, is non-transferable and no assignment, encumbrance or transfer, whether voluntary, involuntary, by operation of law or otherwise, shall vest any interest or right in such option or LAR in any assignee or transferee. Immediately upon any assignment or transfer, the option or LAR shall terminate, be cancelled and of no further effect. However, an option and the right to exercise it may transfer to a participant's heirs and legal personal representative in death.
•: The exercise price of each option granted under the SOP and the Legacy Suncor Plans cannot be less than the fair market value of a common share at the time of grant.
•: Options granted prior to 2012 under the SOP and the Legacy Suncor Plans, but not yet exercisable, become immediately exercisable in the event of a change of control of Suncor. The SOP was amended (the "Amendments") in 2012. Shareholder approval was not required under the SOP or pursuant to the rules of the TSX and therefore will not be sought for the Amendments. Pursuant to the Amendments, awards made under the SOP subsequent to January 1, 2012 will no longer automatically vest upon a change of control. Rather, upon the happening of a change of control, the SOP will require that awards that have been granted under the SOP subsequent to January 1, 2012 and that remain outstanding on the change of control be substituted with new awards on substantially the same terms and conditions. Provided the foregoing occurs, a holder's options will not vest upon or in connection with a change of control unless his or her employment is terminated within twelve months of the change of control (other than for cause) – in which case, the options will vest upon the holder's termination and shall expire three months following the termination date.
•: The SOP and the Legacy Suncor Plans provide for adjustments to be made for the effect of certain events, including but not limited to, subdivision, consolidation, reorganization or other events which necessitate adjustments to the options in proportion with adjustments made to all common shares.
•: The aggregate number of common shares which may be reserved for issuance under the SOP and all other security-based compensation arrangements of Suncor, must not, within any one-year period be issued, or at any time under such arrangements be issuable, to insiders of Suncor (as defined in the TSX Manual) in an amount exceeding 10% of Suncor's total issued and outstanding securities.
•: Pursuant to the SOP, in the event of an employee's involuntary termination (other than for cause, death, disability retirement or in connection with a change of control) or voluntary termination of employment, unvested options expire immediately and vested options expire no later than three months from such termination. Vested options expire one year after termination of employment due to death or disability and no later than three years after termination of employment due to retirement. In the event of involuntary termination for cause, all options expire on the date of such termination.
•: Pursuant to the ESP and the SKCSO, in the event of an employee's involuntary or voluntary termination of employment, unvested options expire immediately and vested options expire no later than six months from such termination. Vested options expire one year after termination of employment due to death or disability and no later than three years after termination of employment due to retirement.
•: Pursuant to the SPSO Plan and the SunShare 2012 Plan, all unvested options are cancelled on cessation of employment for any reason other than death, retirement or disability. Vested options expire in these circumstances six months from cessation of employment, unless the employee is terminated for cause in which case the vested options also expire immediately. Upon termination of employment due to death, unvested options expire one year from the employee's death and 18 months from the employee's death if they vest during the first year after the employee's death. Pursuant to the SPSO Plan, upon retirement or disability, options vest on a pro-rated basis, based on active service and achievement of performance criteria and expire one year from date of vesting. Pursuant to the SunShare 2012 Plan, upon retirement or disability, options may vest on a pro-rated basis based on active service. Any options that have not vested within one year of retirement shall be cancelled and be of no further force and effect.
•: Pursuant to the PCSOP, unless otherwise determined at the time of grant, in the event of: (a) the death of an option holder, all options shall immediately vest with one year to exercise or until the normal expiry date if earlier; (b) voluntary retirement of an option holder, all options held shall immediately vest upon the date of retirement and may be exercised after vesting for up to three years after retirement or until the normal expiry date, if earlier; (c) the termination without cause of the option holder's employment, options vested on the effective date of the termination may be exercised within the earlier of 90 days of the effective date of termination or the normal expiry date and all other options expire immediately; and (d) termination with cause of the option holder's employment or voluntary resignation (other than at retirement), all options expire immediately.
•: Pursuant to the PCSAR (for employees residing outside the European Economic Area ("EEA")), unless otherwise determined at the time of grant, in the event of: (a) death of a SARs holder, all rights immediately vest with one year to exercise or until

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR 51

the normal expiry date if earlier; (b) voluntary retirement all rights continue to vest on the original schedule and may be exercised after vesting for up to four years after retirement or until the normal expiry date, if earlier; (c) the termination without cause of the SARs holder's employment, rights that are vested on the effective date of termination may be exercised during the following 90 days or until the normal expiry date, if earlier, and all other SARs expire immediately; and (d) the termination with cause of the SARs holder's employment or voluntary resignation (other than at retirement), all rights expire immediately.

•: Pursuant to the PCPSU (for employees residing outside of the EEA), unless otherwise determined at the time of grant, in the event of: a) death of a PSU holder, the award is prorated based on the portion of the performance period employed; b) voluntary retirement, or termination or retirement of the PSU holder's employment without cause, the PSU holder may, at management discretion, receive a prorated award based on the portion of the performance period employed; and c) the termination or retirement with cause of the PSU holder's employment or voluntary resignation all unpaid awards (earned or unearned) are forfeited.

DIRECTORS' AND OFFICERS' INSURANCE

Under policies purchased by Suncor, approximately US$150 million of insurance is in effect for the directors and officers of Suncor against liability for any actual or alleged error, misstatement, misleading statement, act, omission, neglect or breach of duty in discharging their duties, individually or collectively. Suncor is also insured under these policies in the event it is permitted or required by law to indemnify individual directors and officers.

The policies are subject to certain exclusions, and provide for a corporate deductible of US$10 million in circumstances where Suncor indemnifies individual directors and officers. If Suncor is unable by law to indemnify individual directors and officers, including in an event of insolvency, there is no deductible. In 2011, Suncor paid premiums of approximately US$1.4 million for directors and officers insurance for the 12-month period ending July 1, 2011.

CORPORATE GOVERNANCE

The Board is committed to maintaining high standards of corporate governance, and regularly reviews and updates its corporate governance systems in light of changing practices, expectations and legal requirements.

Suncor is a Canadian reporting issuer. Our common shares are listed on both the TSX and the New York Stock Exchange ("NYSE"). Accordingly, our corporate governance practices reflect applicable rules and guidelines adopted by the Canadian Securities Administrators (the "Canadian Requirements") and the U.S. Securities and Exchange Commission ("SEC"), including applicable rules adopted by the SEC to give effect to the provisions of the Sarbanes-Oxley Act of 2002 (collectively, the "SEC Requirements"). NYSE corporate governance requirements are generally not applicable to non-U.S. companies. However, Suncor has reviewed its practices against the requirements of the NYSE applicable to U.S. domestic companies ("NYSE Standards"). Based on that review, Suncor's corporate governance practices in 2010 and 2011 did not differ from the NYSE Standards in any significant respect, with the exceptions described in Schedule C attached to this management proxy circular under the heading, "Compliance with NYSE Standards".

Suncor's Statement of Corporate Governance Practices ("Statement") this year is based on the Canadian Requirements, as set out in National Policy 58-201 Corporate Governance Guidelines and National Instrument 58-101 Disclosure of Corporate Governance Practices (collectively, the "CSA Guidelines"). This Statement has been approved by the Board, on the recommendation of its Governance Committee. Suncor's Statement can be found in Schedule C attached to this management proxy circular.

Pursuant to the rules of the TSX, Suncor is required to disclose that it has obtained regulatory approval from the TSX to recommence its normal course issuer bid (the "NCIB"). Pursuant to the NCIB, Suncor is authorized to purchase for cancellation up to an additional $1 billion of its common shares between February 28, 2012 and September 5, 2012, which can be no more than 45,839,791 common shares, being approximately 2.9% of the issued and outstanding common shares as at August 26, 2011. During 2011, and pursuant to the NCIB, Suncor repurchased 17,128,065 common shares at a weighted average price of $29.19 per share. All common shares purchased under the NCIB in 2011 were subsequently cancelled.

The actual number of common shares that may be repurchased under the NCIB in the future, and the timing of any such purchases, will be determined by Suncor. Suncor has entered into a pre-defined purchase plan with a designated broker to allow for the repurchase of common shares during scheduled and unscheduled share trading blackout periods. Shareholders may obtain a copy of the company's Notice of Intention to make a Normal Course Issuer Bid filed with the TSX by contacting Investor Relations.

52 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

SCHEDULE A: DIRECTORS' OUTSTANDING OPTION-BASED AWARDS

The following tables provide details of options held by directors as at December 31, 2011, other than Richard L. George, Suncor's CEO, and Steven W. Williams, Suncor's President and COO.

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


Mel E. Benson	Apr. 26, 2006	8 000	49.13	Apr. 26, 2016	—
	July 31, 2007	4 000	47.34	July 31, 2017	—
	July 29, 2008	4 000	55.86	July 29, 2018	—

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


John T. Ferguson	Apr. 26, 2002	16 000	14.07	Apr. 26, 2012	244 960
	Apr. 24, 2003	16 000	12.31	Apr. 24, 2013	273 120
	Apr. 29, 2004	8 000	16.55	Apr. 29, 2014	102 640
	Apr. 28, 2005	8 000	22.92	Apr. 28, 2015	51 680
	Apr. 26, 2006	8 000	49.13	Apr. 26, 2016	—
	July 31, 2007	6 000	47.34	July 31, 2017	—
	July 29, 2008	6 000	55.86	July 29, 2018	—

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


W. Douglas Ford	Apr. 29, 2004	16 000	16.55	Apr. 29, 2014	205 280
	Apr. 28, 2005	8 000	22.92	Apr. 28, 2015	51 680
	Apr. 26, 2006	8 000	49.13	Apr. 26, 2016	—
	July 31, 2007	4 000	47.34	July 31, 2017	—
	July 29, 2008	4 000	55.86	July 29, 2018	—

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


John R. Huff	Apr. 26, 2002	16 000	14.07	Apr. 26, 2012	244 960
	Apr. 24, 2003	16 000	12.31	Apr. 24, 2013	273 120
	Apr. 29, 2004	8 000	16.55	Apr. 29, 2014	102 640
	Apr. 28, 2005	8 000	22.92	Apr. 28, 2015	51 680
	Apr. 26, 2006	8 000	49.13	Apr. 26, 2016	—
	July 31, 2007	4 000	47.34	July 31, 2017	—
	July 29, 2008	4 000	55.86	July 29, 2018	—

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR A-1

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


Michael W. O'Brien	Apr. 24, 2003	16 000	12.31	Apr. 24, 2013	273 120
	Apr. 29, 2004	8 000	16.55	Apr. 29, 2014	102 640
	Apr. 28, 2005	8 000	22.92	Apr. 28, 2015	51 680
	Apr. 26, 2006	8 000	49.13	Apr. 26, 2016	—
	July 31, 2007	4 000	47.34	July 31, 2017	—
	July 29, 2008	4 000	55.86	July 29, 2018	—

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


Eira M. Thomas	Apr. 26, 2006	16 000	49.13	Apr. 26, 2016	—
	July 31, 2007	4 000	47.34	July 31, 2017	—
	July 29, 2008	4 000	55.86	July 29, 2018	—

(1): Value reported reflects the 'in-the-money' amount (the difference between the closing price on the TSX of a Suncor common share on December 31, 2011 ($29.38) and the exercise price of the option) of the exercisable and non-exercisable options held as of December 31, 2011.

A-2 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

SCHEDULE B: NAMED EXECUTIVE OFFICERS' OUTSTANDING OPTION-BASED AWARDS

The following tables provide details of options held by the Named Executive Officers as at December 31, 2011. Details of options granted to Named Executive Officers subsequent to December 31, 2011 are included in the "Compensation Discussion and Analysis".

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options ⁽²⁾	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


R.L. George	Jan. 25, 2002	310 000	11.96	Feb. 12, 2012	5 400 200
Chief Executive Officer	Apr. 30, 2002	560 000 ⁽³⁾	13.82	Apr. 29, 2012	8 713 600
	Jan. 24, 2003	360 000	13.07	Jan. 24, 2013	5 871 600
	Jan. 29, 2004	180 000	17.29	Jan. 29, 2014	2 176 200
	Feb. 3, 2005	144 000	20.78	Feb. 3, 2015	1 238 400
	Feb. 2, 2006	158 000	46.05	Feb. 2, 2016	—
	Jan. 30, 2007	166 000	43.72	Jan. 30, 2017	—
	Sept. 28, 2007	160 000 ⁽⁴⁾	47.55	Sept. 27, 2014	—
	Feb. 4, 2008	156 000	47.52	Feb. 4, 2018	—
	Jan. 27, 2009	136 000	24.50	Jan. 27, 2019	663 680
	Feb 5, 2010	306 300	31.85	Feb. 5, 2017	—
	Feb 7, 2011	412 800	41.24	Feb. 7, 2018	—

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options ⁽²⁾	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


B.W. Demosky	Feb. 1, 2006	23 334 ⁽³⁾	45.85	Apr. 29, 2012	—
Chief Financial Officer	Feb. 2, 2006	5 466	46.05	Feb. 2, 2016	—
	Jan. 30, 2007	6 000	43.72	Jan. 30, 2017	—
	Sept. 28, 2007	22 000 ⁽⁴⁾	47.55	Sept. 27, 2014	—
	Feb. 4, 2008	7 400	47.52	Feb. 4, 2018	—
	Mar. 3, 2008	2 600	51.23	Mar. 3, 2018	—
	Apr. 1, 2008	23 936 ⁽⁴⁾	49.36	Sept. 27, 2014	—
	Jan. 27, 2009	10 000	24.50	Jan. 27, 2019	48 800
	Feb. 5, 2010	45 000	31.85	Feb. 5, 2017	—
	Feb. 7, 2011	80 000	41.24	Feb. 7, 2018	—

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options ⁽²⁾	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


S.W. Williams	Jan. 24, 2003	100 000	13.07	Jan. 24, 2013	1 631 000
President & Chief Operating Officer	Aug. 5, 2003	57 000	12.78	Aug. 5, 2013	946 200
	Jan. 29, 2004	50 000	17.29	Jan. 29, 2014	604 500
	Feb. 3, 2005	48 000	20.78	Feb. 3, 2015	412 800
	Feb. 2, 2006	48,000	46.05	Feb. 2, 2016	—
	Jan. 30, 2007	46 000	43.72	Jan. 30, 2017	—
	Mar. 19, 2007	24 000	40.29	Mar. 19, 2017	—
	Apr. 1, 2007	16 000 ⁽³⁾	44.17	Apr. 29, 2012	—
	Sept. 28, 2007	110 000 ⁽⁴⁾	47.55	Sept. 27, 2014	—
	Feb. 4, 2008	70 000	47.52	Feb. 4, 2018	—
	Jan. 27, 2009	65 000	24.50	Jan. 27, 2019	317 200
	Feb. 5, 2010	130 000	31.85	Feb. 5, 2017	—
	Feb. 7, 2011	200 000	41.24	Feb. 7, 2018	—

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR B-1

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options ⁽²⁾	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


B.J. Jackman	Feb. 11, 2002	118 000	13.37	Feb. 10, 2012	1 889 180
Executive Vice President, Refining & Marketing	Feb. 14, 2003	128 000	20.07	Feb. 13, 2013	1 191 680
	Feb. 25, 2005	66 800	26.78	Feb. 23, 2012	173 680
	Mar. 1, 2006	64 000	40.67	Feb. 28, 2013	—
	Feb. 23, 2007	96 000	34.34	Feb. 22, 2014	—
	Feb. 22, 2008	96 000	36.82	Feb. 21, 2015	—
	Feb. 24, 2009	134 400	19.44	Feb. 23, 2016	1 335 936
	Feb. 5, 2010	62 400	31.85	Feb. 5, 2017	—
	Feb. 7, 2011	90 000	41.24	Feb. 7, 2018	—

		Option-Based Awards
Name	Grant Date	Number of securities underlying unexercised options ⁽²⁾	Option exercise price ($)	Option expiration date	Value of unexercised 'in-the-money' options ⁽¹⁾ ($)


M.S. LITTLE	Nov. 17, 2008	20 000	23.30	Nov. 17, 2018	121 600
Executive Vice President, Oil Sands & In Situ	Dec. 1, 2008	47 620 ⁽⁴⁾	47.55	Sept. 27, 2014	—
	Jan. 27, 2009	18 000	24.50	Jan. 27, 2019	87 840
	Feb. 5, 2010	43 000	31.85	Feb. 5, 2017	—
	Feb. 7, 2011	100 000	41.24	Feb. 7, 2018	—

(1): Unless noted, refers to options granted under the SOP, closed ESP and closed PCSOP.
(2): Value reported reflects the 'in-the-money' amount between the closing price on the TSX of a Suncor common share on December 31, 2011 ($29.28) and the exercise price of the exercisable and non-exercisable options held as of December 31, 2011.
(3): Options granted under the SPSO Plan.
(4): Options granted under the SunShare 2012 Plan.

B-2 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

SCHEDULE C: CORPORATE GOVERNANCE SUMMARY

THROUGHOUT THIS SUMMARY, THERE ARE REFERENCES TO INFORMATION AVAILABLE ON THE SUNCOR ENERGY INC. ("SUNCOR" OR THE "CORPORATION") WEB SITE ⁽¹⁾ . ALL SUCH INFORMATION IS AVAILABLE AT WWW.SUNCOR.COM UNDER THE "ABOUT US-GOVERNANCE" TAB. IN ADDITION, SHAREHOLDERS MAY REQUEST PRINTED COPIES OF THESE MATERIALS BY CONTACTING SUNCOR AT THE ADDRESS ON THE BACK OF THIS CIRCULAR, BY CALLING 1-800-558-9071 OR BY EMAIL REQUST TO INFO@SUNCOR.COM.

Board of Directors – Composition and Independence

The cornerstone of Suncor's governance system is its board of directors (the "Board" or "Board of Directors"), whose duty is to supervise the management of Suncor's business and affairs. The composition of the Board and its independence are important elements of this system. Richard L. George, Suncor's Chief Executive Officer ("CEO") and Steven W. Williams, Suncor's President and Chief Operating Officer, are the only members of the Board who are not independent. Both Mr. George and Brian MacNeill are retiring in 2012 and therefore are not standing for re-election as directors. Following the annual general meeting and assuming that all directors are elected as contemplated in the Circular, 11 of 12 members (91.7%) of the Board will be independent directors. A short biography of each Suncor director standing for election can be found starting on page 7 of the Circular.

THE BOARD IS COMPRISED OF A MAJORITY OF INDEPENDENT DIRECTORS (12 OF 14 MEMBERS (85.7%)). ALL OF THE MEMBERS OF THE COMMITTEES OF THE BOARD ARE INDEPENDENT. SUNCOR'S INDEPENDENT DIRECTORS MEET IN CAMERA AT THE BEGINNING AND END OF EACH BOARD AND COMMITTEE MEETING WITHOUT MANAGEMENT PRESENT.

Each of the Governance, Audit and Human Resources and Compensation Committee ("HR&CC") are required to be and are comprised entirely of independent directors. In addition, the Environment, Health, Safety and Sustainable Development ("EHS&SD") Committee is comprised entirely of independent directors.

Suncor's independent directors meet in-camera at the beginning and end of each Board meeting without management present. Mr. George and Mr. Williams, as members of management and the only Suncor directors who are not independent, do not participate in these sessions. The sessions are presided over by John Ferguson, Suncor's independent chairman since April 2007. The Board's committees also hold in-camera sessions without management present immediately before and following each of their meetings. These sessions are presided over by the independent chairs of the respective committees. Any issues addressed at the in-camera meetings requiring action on behalf of, or communication to management, are communicated to management by the independent chair or other independent director.

The Board has developed and approved written position descriptions for the Board chairman and Board committee chairs, each of which are available on Suncor's website. The position description for Suncor's chairman of the Board is also set out in Schedule D attached to the Circular. The position descriptions for the Board chairman and Board committee chairs supplement the Terms of Reference, as defined below, and are reviewed annually by the Governance Committee. Any changes to the position descriptions are recommended by the Governance Committee to the full Board.

The Board reviews the independence of its members annually. The Board has adopted independence criteria for assessing the independence of directors including additional requirements applicable to members of the Audit Committee. The Board's independence policy and criteria include a description of certain relationships that operate as a complete bar to independence. Suncor's independence criteria are consistent with the Canadian Requirements and the SEC Requirements (each defined on page 52 of the Circular). The independence criteria are set out in Schedule E attached to the Circular.

In applying the independence criteria, the Board reviews and analyzes the existence, materiality and effect of any relationships between Suncor and each of its directors, either directly, through a family member or as a partner, shareholder or officer of another organization that has a relationship with Suncor and determines in each case whether the relationships could, or could reasonably be perceived to, materially interfere with the director's ability to act independently of management.

Some of Suncor's directors sit on the boards of other public companies, the particulars of which are set out in the biographies on pages 7 to 12 of the Circular. John Ferguson and Jacques Lamarre, both members of the Board, were also members of the board of directors and risk committee of Royal Bank of Canada during 2011 and for part of 2012. Mr. Ferguson did not stand for re-election as a director of Royal Bank of Canada at its annual meeting of shareholders held on March 1, 2012. The Board has determined that the foregoing interlocks do not impair either of Mr. Ferguson's or Mr. Lamarre's independence. No other members of the Board sit together on the board of any other entity.

(1): Information on Suncor's website, though referenced herein, does not form part of this Schedule or the management proxy circular (the "Circular") to which this Schedule is attached.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR C-1

Some members of the Board are involved with companies with which Suncor has business relationships. The Board has reviewed these relationships on a case-by-case basis against the independence criteria and has determined that none of these relationships impair the independence of the individual directors, as the directors do not serve as employees or executives of these other companies, their respective remuneration from these directorships is not personally material to them nor is it dependent on or variable with the nature or extent of the business relationship with Suncor and they are not personally involved in negotiating, managing, administering or approving contracts between Suncor and the other entities on whose boards they serve. The Board's conflict of interest policy, described in detail below, precludes these directors from voting with respect to any of these arrangements, should they be considered by the Board. In the event there is any material discussion of these arrangements or any arrangements involving competitors of these entities by the Board, these directors are expected to declare such interest and absent themselves from the boardroom during those discussions.

Terms of Reference

The Board has adopted terms of reference (the "Terms of Reference"), which serve as the charter of the Board and which are reviewed by the Board at least annually. The Terms of Reference include a general overview of the Board's role in Suncor's governance, a statement of key guidelines and policies applicable to the Board and its committees and a mandate that describes its major responsibilities, goals and duties. These major responsibilities, goals and duties range from specific matters, such as the declaration of dividends that by law must be exercised by the Board, to its general role to determine, in broad terms, the purposes,

THE BOARD HAS ADOPTED TERMS OF REFERENCE, WHICH INCLUDES A BOARD MANDATE.

goals, activities and general characteristics of Suncor and its business. The Terms of Reference provide that the Board is responsible for the selection, monitoring and evaluation of executive management and for overseeing the ways in which Suncor's business and affairs are managed, thereby assuming responsibility for the stewardship of Suncor. The full text of the Terms of Reference is set out in Schedule F attached to the Circular.

The Board of Directors discharges its responsibilities through preparation for and attendance at, regularly scheduled meetings and through its four standing committees, namely the Governance Committee, the Audit Committee, the EHS&SD Committee and the HR&CC. Each committee has a written mandate that is reviewed annually by such committee. In considering the appointment of members to the committees, the Board ensures that each committee includes directors of diverse background and at least one director with significant expertise relevant to the committee's roles.

Each of these committees is comprised solely of independent directors and, except where otherwise specified in the Terms of Reference, or in Suncor's by-laws, each committee has the power to determine its own rules of procedure. Subject to limited exceptions, these committees generally do not have decision making authority; rather, they convey their findings and recommendations on matters falling within their respective mandates to the full Board of Directors.

The committees also have the authority to conduct any independent investigations into matters which fall within the scope of their responsibilities and may engage external advisors (as may the full Board or an individual director), at Suncor's expense, to assist them in fulfilling their mandate. For a brief summary of the key functions, roles and responsibilities of Board committees, see "Board Committees" on page 5 of this Schedule.

The Board of Directors delegates day-to-day management of Suncor's business to Suncor's CEO and other members of senior management. The Board, through the CEO, sets standards of conduct, including Suncor's general moral and ethical tone, compliance with applicable laws, standards for financial practices and reporting, qualitative standards for operations and products and other standards that reflect the views of the Board as to the conduct of the business of Suncor. A management control process policy, adopted by the Board, defines and sets limits on the authority delegated to management.

The Board has developed and approved a written position description for the CEO, which includes a general description of the role as well as specific accountabilities in the areas of strategic planning, financial results, leadership, safety, government, environment and social relations and management's relationship with the Board. A copy of the CEO position description is available on Suncor's website.

The following is a description of some key duties of the Board as set out in the Terms of Reference. The following description is not exhaustive. For more information, please refer to the "Board Committees" on page 5 of this Schedule, the Terms of Reference set out in Schedule F attached to this Circular and the mandates of the Board committees, available on Suncor's website.

Ethics. The Terms of Reference explicitly recognize that the Board, through the CEO, sets Suncor's standards of conduct, including Suncor's general moral and ethical tone and standards for compliance with applicable laws. The Terms of Reference also state that the Board should be satisfied that the CEO is creating and fostering a culture of integrity within Suncor. The Board plays an active role in this area through its oversight of Suncor's standards of business conduct code (the "Code") and compliance program (see "Ethical Business Conduct" on page 8 of this Schedule) and through its assessment and evaluation of the performance of the CEO. The CEO's position description includes accountability for setting a high ethical tone for the organization as a whole and fostering a culture of integrity throughout the organization.

C-2 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

Strategic Planning. One of the Board's major duties is to review, with management, Suncor's mission, objectives and goals and the strategies for achieving them. The Board is responsible for ensuring Suncor has an effective strategic planning process and for annually approving the capital budget and the strategies reflected in Suncor's long-range plan. A Board meeting principally devoted to corporate strategy is held annually. The Governance Committee assists the Board by annually assessing Suncor's planning and budgeting processes and by acting as an effective sounding board for management on key strategic initiatives. It also works with management to design the annual strategy meeting and assesses the effectiveness of this meeting. The Board is continually provided with updates on the human, technological and capital resources required to implement Suncor's strategies and any regulatory, environmental, social, cultural or governmental constraints that may impact Suncor carrying out its business objectives.

Risk Oversight. One of the major responsibilities of the Board is to oversee the identification of the principal risks of Suncor's business and ensure there are systems in place to effectively identify, monitor and manage them. At Suncor, a principal risk is generally defined as an exposure that has potential to materially impact Suncor's ability to meet or support its strategic objectives.

SUNCOR HAS ADOPTED TOOLS, INCLUDING AN ENTERPRISE RISK MANAGEMENT SYSTEM, OPERATIONAL EXCELLENCE MANAGEMENT SYSTEM AND TRADING RISK MANAGEMENT POLICY, TO IDENTIFY AND MANAGE RISK.

As part of its risk management governance system, the Board undertakes an annual principal risk review which involves the identification and assessment of the principal risks of Suncor's business and reviewing the risk management strategies and systems being employed by management to identify, monitor and manage these risks. To support the Board in conducting this review, senior management undertakes an entity-wide process to identify, classify, assess and report on Suncor's principal risks and management strategies to address risk, which is reviewed by the Audit

THE BOARD UNDERTAKES AN ANNUAL PRINCIPAL RISK REVIEW AND MONITORS RISK AND IN-PLACE MANAGEMENT OF RISK THROUGHOUT THE YEAR.

Committee semi-annually and by the Board in its annual principal risk review. As part of its risk governance, the Board has also overseen the development by management of Suncor's Enterprise Risk Management Program, which includes an entity-wide approach to risk identification, assessment, monitoring and management. For a detailed explanation of the risks applicable to Suncor and its businesses, see "Risk Factors" in Suncor's Annual Information Form dated March 1, 2012, filed at www.sedar.com.

In its risk oversight role, the Board has overseen the development by management of Suncor's Operational Excellence Management System ("OEMS"), which is currently being introduced across Suncor and is an overarching framework for Suncor to manage all aspects of operational risk. OEMS consists of a series of elements, with corresponding implementation guidelines, that organize and link into one platform all key standards, systems and processes required to manage operational risks, environmental impacts and deliver safe, reliable operations.

The committees of the Board also play a significant risk oversight role. As mentioned above, the Audit Committee conducts periodic reviews to monitor Suncor's principal risks and the management of same and ensures such principal risks are reflected in the mandates of the Board and its committees. As part of this review, each risk is mapped to a Board committee or the full Board as appropriate, for oversight. The Audit Committee, for example, reviews significant physical security management, IT security or business recovery risks and strategies to address such risks. In addition, the Audit Committee reviews financial risk management issues, programs and policies, including cash management, insurance and trading activities. In this role, the Audit Committee oversaw Suncor's adoption of a Trading Risk Management Policy (the "Trading Policy") to address commodity trading risk. The Trading Policy requires all such activities to occur in the group responsible for trading, so that trading risks can be properly monitored, controlled and reported. The Board has set the trading commodities, trading term limits, value at risk limits and stop loss limits under the Trading Policy and any changes to the foregoing require Board approval. The Board reviews and monitors Suncor's compliance with the Trading Policy through the Audit Committee, which receives a quarterly report that summarizes Suncor's trading activities and provides an assessment of Suncor's financial exposure risk from these activities.

Another committee playing a significant risk oversight role is the EHS&SD Committee. The EHS&SD Committee assists the Board in matters pertaining to the integrity of Suncor's physical assets, by monitoring the adequacy of Suncor's internal controls as they relate to operational risks of its physical assets and matters of environment, health, safety and sustainable development. In fulfilling this role, the EHS&SD Committee reviews the results of evaluations of internal controls by the Operations Integrity Audit function as well as progress reports on the implementation of OEMS by Suncor, and reports to the Board of Directors on these matters. In addition, the EHS&SD Committee reviews and approves the appointment or termination of the Director, Operations Integrity Audit, the engagement (including the audit scope, approach, performance and fees) or termination of the external Operations Integrity Auditors and organizational structure of the Operations Integrity Audit department. The EHS&SD Committee also reviews the Operations Integrity Audit charter and its annual audit plans and activities.

The Governance Committee assists the Board by reviewing and assessing emerging risk areas that do not fall under the mandate of another Board committee.

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Succession Planning and Monitoring/Evaluating Senior Management. The Board ensures the continuity of executive management by appointing a CEO and overseeing succession planning. The HR&CC is specifically mandated to assist the Board in this regard, by ensuring that appropriate executive succession planning and performance evaluation programs and processes (including development and career planning) are in place and operating effectively for executives. The HR&CC also reviews significant changes to the organization's structure as they arise and their impact on executive roles.

EFFECTIVE SUCCESSION PLANNING HAS LONG BEEN A FOCUS OF THE BOARD. THE HR&CC REVIEWS THE SUCCESSION PLANNING PROCESS AND RESULTS FOR EXECUTIVE MANAGEMENT ANNUALLY.

The HR&CC undertakes an annual review of the succession planning process and results for executive management and reports to the Board on these matters. As part of this annual process, the CEO, supported by the Senior Vice President, Human Resources, reviews candidates for the CEO and other executive management positions with the HR&CC. In its July, 2011 meeting, the HR&CC reviewed Suncor's succession planning process and its succession plans for Suncor's executive management team, with particular focus paid to the CEO, and subsequently reported to the Board that they found the plan to be comprehensive and detailed and the process to be operating effectively. In December 2011, an important step in the CEO succession plan was successfully implemented when the Board announced that Steve Williams had been appointed to the role of President and would assume the role of CEO following Rick George's retirement at the annual general meeting of Suncor in May, 2012.

The Board also reviews Suncor's processes for successors for its vice presidents, employees who directly report to its vice presidents and managers. Successors are identified using a formalized and consistent process which rigorously assesses leadership potential across Suncor, using specific and clear criteria, including employees' performance, aspirations, engagement, agility, experience and capabilities. To support the development of future leaders, Suncor offers employees multi-day experiences focused on leadership skills, managing resources and leadership experience, to support leadership competence as a core organizational capability.

The Board encourages the CEO to expose the Board to Suncor's executives and high potential employees, both for succession planning and career development and to provide the Board with a broader perspective and context on issues relevant to Suncor. Directors are provided with opportunities to meet with Suncor employees through attendance at events hosted by Suncor, such as Suncor's President's Operational Excellence Awards, or when they visit Suncor's facilities (see "Orientation and Continuing Education" on page 7 of this Schedule).

The HR&CC also assists the Board in monitoring the performance of the CEO by conducting an annual review of the CEO's performance against predetermined goals and criteria (including the goal of succession planning) and reporting to the Board as well as recommending to the Board the total annual compensation of the CEO (see "Compensation Discussion and Analysis" beginning on page 23 of the Circular). The HR&CC also reviews with the CEO the performance of his direct reports and recommendations for their total compensation.

Communication/Disclosure Policy and Stakeholder Feedback. Suncor has a disclosure policy called "Communications to the Public" that establishes guidelines and standards for Suncor's communications with shareholders, investment analysts, other stakeholders and the public generally. This policy includes measures to avoid selective disclosure of material information, identifies designated Suncor spokespersons and establishes internal review processes for key public communications. Suncor's business conduct code (see "Ethical Business Conduct" on page 8 of this Schedule) addresses Suncor's obligations for continuous and timely disclosure of material information and sets standards requiring directors, officers, employees and contractors trading in Suncor shares and other securities to comply with applicable law.

Suncor has disclosure controls and procedures designed to ensure that material information relating to Suncor is made known to our CEO and Chief Financial Officer ("CFO"). Suncor has a Disclosure Committee, chaired by the Vice President and Controller, and has designed and implemented due diligence procedures to support the financial reporting process and the certification of our financial reports by the CEO and CFO.

Suncor interprets its operations for its shareholders and other stakeholders through a variety of channels, including its periodic financial reports, securities filings, news releases, sustainability and climate change reports, webcasts, external website, briefing sessions and group meetings. Suncor encourages and seeks stakeholder feedback through various channels including corporate communications and investor relations programs and through participation in the regulatory process. The Board, either directly or through the activities of a designated Board committee, reviews and approves all quarterly and annual financial statements and related management's discussion and analysis ("MD&A"), management proxy circulars, annual information forms/Form 40-F and press releases containing significant new financial information, among others.

The Board of Directors is specifically mandated to ensure systems are in place for communication with Suncor's shareholders and other stakeholders and that these systems are appropriately resourced. Suncor currently maintains a 1-800 phone number as well as email and regular mail addresses for stakeholder feedback and questions. In addition, Suncor encourages shareholders to attend Suncor's annual meeting. The annual meeting provides a valuable opportunity to hear directly from Suncor's management about the results of Suncor's business and operations, as well as its strategic plans. Members of the

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Board are in attendance at annual meetings and the chairman of the Board and the chair of each Board committee are available to answer questions as appropriate.

The Board recognizes that it is also important for the Board to communicate with shareholders, including organizations that represent or advise shareholders on matters of governance (collectively, "Interested Parties") and to that end, adopted a Shareholder Communication and Engagement Policy (the "Engagement Policy") in 2011. In accordance with the Engagement Policy, Interested Parties may

IN 2011, THE BOARD ADOPTED A SHAREHOLDER COMMUNICATION AND ENGAGEMENT POLICY.

communicate to the Board in writing to express their views on matters that are important to them, by addressing their correspondence to the Board in care of the Corporate Secretary at the address set forth on the back page of the Circular or via email at: info@suncor.com, subject line: Attention: [Chairman of the Board / Chair of [Insert Board Committee Name]] c/o Corporate Secretary. The Board has determined that questions or concerns related to the Board and senior management succession process, executive and Board compensation, Board level corporate governance and other matters that are within the scope of the Board's supervisory and oversight duties, as set out in its Terms of Reference, may appropriately be addressed to and by, the Board. In addition, the Engagement Policy recognizes that in certain circumstances it may be appropriate for Board members, generally through the chairman of the Board or the chair of a committee, to meet with an Interested Party, and sets out criteria to be considered if the Board receives a meeting request and terms applicable to the conduct of any such meeting.

Expectations and Responsibilities of Directors. The Terms of Reference, supplemented by a Board approved accountability statement for directors (the "Accountability Statement"), which is available on Suncor's website, identifies the key expectations placed on Board members. Directors are expected to review meeting materials in advance of meetings to encourage and facilitate discussion and questions. Board meeting dates are established well in advance and directors are expected to be prepared for and attend all meetings absent extenuating circumstances. Directors' attendance records for meetings held in 2011 are set out on page 9 of this Schedule.

Directors must devote sufficient time and energy to their role as Suncor director to effectively discharge their duties to Suncor and the Board. Pursuant to the Terms of Reference, Audit Committee members must not be members of the audit committees of more than two other public companies, unless the Board determines that simultaneous service on a greater number of audit committees would not impair the member's ability to effectively serve on Suncor's Audit Committee.

Internal Controls. The Board of Directors is specifically mandated to ensure processes are in place to monitor and maintain the integrity of Suncor's internal controls and management information systems. The Audit Committee assists the Board in this regard and monitors the effectiveness and integrity of Suncor's financial reporting, management information, internal controls and Suncor's Internal Audit function (excluding operations integrity audit matters, which are specifically within the mandate of the EHS&SD Committee ⁽²⁾ ).

The Audit Committee exercises general oversight over the Internal Audit function by reviewing the plans, activities, organizational structure, qualifications and performance of the Internal Auditors. The appointment or termination of the chief officer in charge of Internal Audit is reviewed and approved by the Audit Committee. This officer has a direct reporting relationship with the committee and meets with it, in the absence of other members of management, at least quarterly. The Audit Committee also reviews and recommends appointees to the office of the CFO.

Board Committees

In addition to the responsibilities described elsewhere in this Schedule, the following provides a brief summary of the key functions, roles and responsibilities of Board committees. The complete text of the mandate of each Board committee is available on Suncor's website.

Governance Committee. The Governance Committee assists the Board in two main areas: corporate governance; and corporate strategy. In its governance role, the Governance Committee is mandated to determine Suncor's overall approach to governance issues and key corporate governance principles. In doing so, it closely monitors emerging best practices in governance. In 2011, the chair of the Governance Committee met with a governance organization to learn about evolving governance practices and a member of the committee attended a forum for director education on executive compensation (see "Orientation

THE GOVERNANCE COMMITTEE CLOSELY MONITORS EMERGING BEST PRACTICES IN GOVERNANCE.

and Continuing Education" on page 7 of this Schedule). In addition, the Corporate Secretary, or her delegate, attended seminars, conferences and meetings on governance and updated the committee on developing trends and practices. The Governance Committee also reviews matters pertaining to Suncor's values, beliefs and standards of ethical conduct and Suncor's corporate reputation and assists the Board in its strategy role (see "Strategic Planning", under the heading "Terms of Reference" on page 3 of this Schedule).

(2): References throughout this Schedule to "Internal Audit" in relation to the Audit Committee do not include the operations integrity audit department.

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The Governance Committee reviews and reports to the Board on directors' compensation issues. The Governance Committee has developed, in consultation with the HR&CC and outside advisors, guidelines for director compensation based on, among other factors, directors' roles and responsibilities and an analysis of the competitive position of Suncor's director compensation program. The Governance Committee annually reviews the competitiveness and form of Board compensation and makes recommendations to the full Board on Board compensation and share ownership guidelines for directors. The Board has set director compensation based upon recommendations from this committee.

Audit Committee. The Audit Committee assists the Board in matters relating to Suncor's external auditors and the external audit process, oil and natural gas reserves reporting, financial reporting and public communication, risk management, security and certain other key financial matters. The Audit Committee also assists the Board in matters relating to Suncor's internal controls and the Internal Audit function (see "Internal Controls", under the heading "Terms of Reference" on page 5 of this Schedule).

The Audit Committee plays a key role in relation to Suncor's external auditors. It initiates and approves their engagement (including fees) or termination, subject to shareholder approval and monitors and reviews their independence, effectiveness, performance and quality control processes and procedures.

The Audit Committee reviews and approves, with management and external auditors, significant financial reporting issues, the conduct and results of the annual audit and significant finance, accounting and disclosure policies and other financial matters. The Audit Committee also plays a key role in financial reporting, by reviewing Suncor's core disclosure documents, being its annual and interim financial statements, MD&A, annual information form and Form 40-F. The committee approves interim financial statements and interim MD&A and makes recommendations to the Board with respect to approval of the annual disclosure documents.

The Audit Committee also plays a key oversight role in the evaluation and reporting of Suncor's oil and natural gas reserves. This includes review of Suncor's procedures relating to reporting and disclosure, as well as those for providing information to Suncor's independent reserves evaluator. The Audit Committee approves the appointment and terms of engagement (including fees) of the reserves evaluator, including their qualifications and independence and any changes in their appointment. Suncor's reserves data and report of the reserves evaluator are annually reviewed by the Audit Committee prior to approval by the full Board of Directors.

The Audit Committee reviews Suncor's policies and practices with respect to cash management, financial derivatives, financing, credit, insurance, taxation, commodities trading and related matters. It also reviews the assets, financial performance, funding and investment strategy of Suncor's registered pension plan, as well as the terms of engagement of the plan's actuary and fund manager and any significant actuarial reports. The Audit Committee oversees generally the Board's risk management governance model (see "Risk Oversight", under the heading "Terms of Reference" on page 3 of this Schedule) and also monitors Suncor's business conduct code compliance program (see "Ethical Business Conduct" on page 8 of this Schedule).

Members of the Audit Committee are required to be financially literate. In addition, at least one member of the Audit Committee must be determined by the Board to be an "audit committee financial expert". The Board has determined Mr. O'Brien and Mr. D'Alessandro, members of the Audit Committee and independent directors, to be such experts. The criteria for assessing the financial literacy of Audit Committee members and whether they qualify as an "audit committee financial expert", are set out in the Terms of Reference in Schedule F attached to the Circular.

For additional information about Suncor's Audit Committee, including the Audit Committee Mandate and Pre-approval Policies and Procedures, see "Audit Committee Information" in Suncor's Annual Information Form dated March 1, 2012, filed at www.sedar.com.

Environment, Health, Safety and Sustainable Development Committee. The EHS&SD Committee reviews the effectiveness with which Suncor meets its obligations and achieves its objectives pertaining to the environment, health, safety and sustainable development. This includes the effectiveness with which management establishes and maintains appropriate EHS&SD policies. The EHS&SD Committee also monitors management's performance and emerging trends and issues in these areas. In fulfilling its role, the EHS&SD Committee reviews quarterly, annual and other management stewardship reports as well as the findings of significant external and internal environmental, health and safety investigations, assessments, reviews and audits. Suncor's periodic sustainability report, a detailed public disclosure document that includes reporting on Suncor's EHS&SD progress, plans and performance objectives, is also reviewed by the EHS&SD Committee.

The EHS&SD Committee also assists the Board in matters pertaining to the integrity of Suncor's physical assets, by monitoring the adequacy of Suncor's internal controls as they relate to operational risks of its physical assets and matters of environment, health, safety and sustainable development (see "Risk Oversight", under the heading "Terms of Reference" on page 3 of this Schedule).

Human Resources and Compensation Committee. The HR&CC assists the Board by annually reviewing the performance of the CEO and recommending his total compensation to the full Board. The corporate objectives for which the CEO is responsible include a combination of corporate goals and personal goals, set annually by the Board of Directors in consultation with the HR&CC and the chairman of the Board. The HR&CC annually reviews the CEO's performance against these objectives

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and against the key accountabilities of his position, as set out in the CEO's position description. The HR&CC reports its assessment to the full Board which ultimately approves CEO compensation.

The HR&CC also reviews annually the CEO's evaluation of the other senior executives within the organization and his recommendation for their total compensation. No member of the HR&CC is currently a chief executive officer of any other public issuer.

For more information about the HR&CC and the process and criteria for determining the CEO's total compensation, see "Compensation Discussion and Analysis" on page 23 of the Circular. See also "Succession Planning and Monitoring/Evaluating Senior Management", under the heading "Terms of Reference" on page 4 of this Schedule.

Orientation and Continuing Education

AT LEAST ONCE ANNUALLY, THE BOARD MEETS AT A SUNCOR LOCATION OUTSIDE OF CALGARY SO THAT IT CAN LEARN ABOUT SUNCOR'S OPERATIONS AND COMMUNITIES IN WHICH THEY ARE CARRIED OUT. THE BOARD HAS A STRATEGIC EDUCATION PROGRAM AND CONTINUING EDUCATION POLICY IN PLACE, BOTH OF WHICH WERE EFFECTIVELY UTILIZED IN 2011.

Each new member of the Board participates in a formal orientation program. The orientation program includes in-person meetings with senior management on key legal, environmental, business, financial and operational topics central to Suncor's business and operations and a tour at the sites of some of Suncor's principal operations. The orientation program also focuses on the role of the Board, its committees and its directors and the nature and operation of Suncor's business.

A directors' handbook, containing information about the Board and Suncor, including Suncor's core governance documents, is presented to each director upon joining the Board. The handbook is continuously updated and is available for viewing by directors through a dedicated and secure directors' portal.

Presentations and tours at the sites of Suncor's principal operations are provided to directors on a periodic basis, often in conjunction with Board meetings, for the purpose of directly acquainting directors with Suncor's operations and the communities in which they are located. The presentations and tours also serve as opportunities for directors to meet and familiarize themselves with senior executives and high potential employees.

The Governance Committee maintains the Board's strategic education program. In conjunction with Board meetings, management presents focused information to directors on topics pertinent to Suncor's business, including the impact of significant new laws or changes to existing laws and opportunities presented by new technologies. In an annual survey, directors are asked to suggest topics of interest for future information sessions and topics are chosen annually for speakers and / or presentations from internal or external sources.

In connection with the Board strategy session held in February of 2011, the Board was briefed on a number of topics pertinent to Suncor, including the socio-political context for Suncor's business and an external assessment of the long-term dynamics of global energy markets. Moreover, in 2011, the Board was provided with specialized training relating to pension plans, with a focus on the pension arrangements in place within Suncor. In addition, the members of the HR&CC received updates on trends and issues in executive compensation, including an overview of best practices in several topical areas as well as emerging issues. The updates were provided by both management and external consultants.

As part of the Board and committee meetings that were held in July of 2011 in Mississauga, Ontario, the executives and other employees of Suncor's Refining and Marketing business led discussions and information sessions with the Board on the business, including its priorities, opportunities and risks. In addition, all members of the Board visited Suncor's lubricants plant in Mississauga, Ontario, where crude oil feedstock is refined to produce pure lubricating oil-based stocks and other specialized products.

The Board's Director Continuing Education Policy encourages directors to enroll in courses and programs that enhance and supplement their knowledge and skills in areas relevant to their role on the Board, with the approval of the chairman of the Board or chair of the Governance Committee. Through this program, Suncor's directors have taken courses in such diverse topics as reserves evaluation, financial accounting and corporate governance. For example, in 2011, one director (James Simpson) attended the Mercer Director Education Forum in Calgary, a forum which examined recent developments in executive and director pay, emerging trends with respect to director voting, say on pay, clawbacks, share retention requirements, compensation risk assessments and pay for performance. Another director (Jacques Lamarre) attended the Canadian Board Diversity Counsel Roundtable (Montreal), which provides a forum for discussion of diversity in the boardroom.

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Ethical Business Conduct

Sound, ethical business practices are fundamental to Suncor's business. The Code, which applies to Suncor's directors, officers, employees and contractors, requires strict compliance with legal requirements and sets Suncor's standards for the ethical conduct of our business. Topics addressed in the Code include competition, conflict of interest and the protection and proper use of corporate assets and opportunities, confidentiality, disclosure of material information, trading in shares and securities, communications to the public, improper payments, fair dealing in trade relations and accounting, reporting and business control. The Code is supported by detailed policy guidance and

SUNCOR HAS ADOPTED A BUSINESS CONDUCT CODE, SUPPORTED BY DETAILED GUIDANCE AND STANDARDS AND A CODE COMPLIANCE PROGRAM.

standards and a Code compliance program, under which every Suncor director, officer, employee and contract worker is required annually to read a summary of the Code and affirm that he or she has reviewed the summary, that he or she understands the requirements of the Code and provide confirmation of his or her compliance with the Code during the preceding year. The summary provided includes a message from the CEO, emphasizing Suncor's values and making it clear that all representatives of Suncor are expected to conduct daily business in a safe, fair, honest, respectful and ethical manner.

The Board exercises stewardship over the Code in several respects. Suncor's Internal Auditors audit the compliance program annually and the senior director of Internal Audit, who has direct reporting relationships with the Audit Committee, reports on compliance to that committee.

Moreover, at least once annually, the Code is reviewed and if appropriate, updated. Management reports to the Governance Committee annually on this process and any changes are reviewed by the Governance Committee. Any waivers of Code requirements for Suncor's executive officers or members of the Board of Directors must be approved by the Board of Directors or appropriate committee thereof and disclosed. No such waivers were granted in 2011.

Suncor encourages employees to raise ethical concerns with Suncor management and Suncor's legal, corporate security, human resources and Internal Audit departments, without fear of retaliation. In addition, Suncor's "Integrity Hotline" provides a means for Suncor employees to raise issues of concern anonymously, with a third party service provider. The Integrity Hotline is available 24 hours a day, seven days a week. Any issues of a serious nature are investigated by Suncor's Internal Auditors or security staff. The Audit Committee receives regular updates on activities relating to the Integrity Hotline.

Suncor provides additional specialized training for employees for matters governed by the Code, where it is determined such training would be beneficial. For example, all employees directly involved with Suncor's international and offshore operations are required to attend focused workshops, which address, among other items, compliance with sanctions and anti-bribery and anti-corruption legislation and best practices for operating in international jurisdictions where Suncor operates.

The Code is available on Suncor's website.

Conflicts of Interest

The Board has adopted a policy relating to directors' conflicts of interest. Pursuant to this policy, directors are required to maintain with the Corporate Secretary a current list of all other entities in which they have a material interest, or on which they serve as a director, trustee or in a similar capacity. This list is made available to all directors through the directors' portal. Directors must immediately advise the Corporate Secretary of any deletions, additions or other changes to any information in their declaration of interest.

If the change involves a change in the director's principal occupation or an appointment as director, officer or trustee of any for-profit or not-for-profit organization, the director must also notify the chairman of the Board, who will determine whether the change would be inconsistent with the director's duties as a member of the Board. In appropriate circumstances, the director's resignation may be required.

The policy sets out clear procedures applicable in the event conflicts arise. If a director is a party to, or has an interest in any party to, a contract or transaction before the Board of Directors (regardless of the materiality of the contract or transaction), the director must immediately advise the chairman of the Board or the particular committee chair. The director's conflict or potential conflict is recorded in the minutes of meeting and the director is required to absent himself or herself from the meeting for any material discussions or deliberations concerning the subject matter of the contract or transaction. The director is required to abstain from voting on any resolution in respect of such contract or transaction.

The Corporate Secretary ensures that directors do not receive Board materials in situations where the subject matter of those materials could involve an actual or potential conflict of interest.

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Board and Committee Meetings

ALL MEMBERS OF THE BOARD ATTENDED 100% OF THE BOARD AND COMMITTEE MEETINGS HELD IN 2011.

The chairman of the Board, in consultation with the Corporate Secretary, has the responsibility of establishing a schedule for the meetings of the Board of Directors and its committees each year, which is approved by the Board. Board and committee meeting dates are established sufficiently in advance where possible (at least one year and longer if practical) to minimize conflict with other commitments on directors' schedules. The Board holds at least five meetings per year, one of which is principally devoted to strategy. If, during the course of the year, circumstances require Board or committee action or consideration, additional meetings are called.

The chairman of the Board works with the CEO to establish the agenda for each Board meeting. The chair of each committee, in consultation with the committee secretary, determines the agenda for each committee meeting. Each Board member is free to suggest inclusion of items on any Board or committee agenda. Whenever feasible, important issues for decision are dealt with over the course of two meetings. The first meeting allows for a thorough briefing and the second allows for the final discussion and decision.

The following provides details about Board and committee meetings held during 2011 and the directors' attendance at these meetings.


BOARD AND COMMITTEES	NUMBER OF MEETINGS HELD IN 2011

Board ⁽¹⁾	7

Governance Committee	5

Audit Committee	7	⁽²⁾

HR&CC	6	⁽²⁾

EHS&SD Committee	4


	NUMBER OF MEETINGS AND NUMBER OF MEETINGS ATTENDED

DIRECTOR ⁽³⁾	BOARD ⁽¹⁾	GOVERNANCE COMMITTEE	AUDIT COMMITTEE	HR&CC	EHS&SD COMMITTEE	COMMITTEES (TOTAL)	OVERALL ATTENDANCE

Mel E. Benson	7/7	—	—	6/6	4/4 (Chair)	10/10	17/17

Brian A. Canfield ⁽⁴⁾	3/3	—	3/3 (Chair) ⁽⁵⁾	—	3/3	6/6	9/9

Dominic D'Alessandro	7/7	5/5	7/7	—	—	12/12	19/19

John T. Ferguson ⁽⁶⁾	7/7 (Chairman)	—	—	—	—	—	7/7

W. Douglas Ford	7/7	5/5	—	6/6	—	11/11	18/18

Richard L. George	7/7	—	—	—	—	—	7/7

Paul Haseldonckx	7/7	—	7/7	—	4/4	11/11	18/18

John R. Huff	7/7	—	—	6/6	4/4	10/10	17/17

Jacques Lamarre	7/7	—	—	6/6	4/4	10/10	17/17

Brian F. MacNeill	7/7	5/5 (Chair)	7/7	—	—	12/12	19/19

Maureen McCaw	7/7	—	—	6/6	4/4	10/10	17/17

Michael W. O'Brien	7/7	5/5	7/7 (Chair) ⁽⁵⁾	—	—	12/12	19/19

James W. Simpson	7/7	5/5	—	6/6 (Chair)	—	11/11	18/18

Eira M. Thomas	7/7	5/5	7/7	—	—	12/12	19/19

(1): Board meetings held on February 1-2 and November 7-8 are each counted as one meeting for the purpose of the foregoing table.
(2): A combined meeting of the Audit Committee and HR&CC was held in July of 2011.
(3): Steven W. Williams was appointed to the Board at the last Board meeting of 2011 and therefore attended no meetings of the Board or any committee of the Board in his capacity as a director in 2011.
(4): Mr. Canfield retired as a member of the Board, Audit Committee and EHS&SD Committee effective as of May 3, 2011.
(5): Mr. Canfield acted as chair of the Audit Committee until his retirement on May 3, 2011, following which Mr. O'Brien was appointed to act in such capacity.
(6): Mr. Ferguson is not a member of any standing committee and therefore attendance is only recorded for meetings of the Board.

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Nomination of Directors

The selection process for new nominees for membership on the Board of Directors is conducted by the Governance Committee. More information on the responsibilities, powers and operations of the Governance Committee is found beginning on page 5 of this Schedule.

In considering its recommendations, the Governance Committee acknowledges that the Board's membership should represent a diversity of backgrounds, experience and skills. Directors are selected for their integrity and character, sound and independent judgment, breadth of experience, insight and knowledge and business acumen. Directors are expected to bring these personal qualities to their role as a Suncor director and apply sound business judgment to help the Board make wise decisions and provide thoughtful and informed counsel to senior management.

Pursuant to the policies of the Board, the assessment and selection process is undertaken by the Governance Committee as needed and consists of several steps, including maintaining and updating from time to time, an inventory of capabilities, competencies and skills of current Board members and of the Board as a whole, which is provided below. The Board has determined that the industry background and functional experience of the Board currently maps well to Suncor's strategy – to be Canada's premier integrated energy company.

The above inventory is assessed as required to identify any gaps between the desired set of capabilities, competencies, skills and qualities that are required to undertake the overall strategy of Suncor and those that are adequately represented on the Board, taking pending retirements into account. The Governance Committee uses this assessment as a basis for identifying the skills, experiences, qualifications, diversity and personal qualities desired in potential new Board members. The Governance Committee identifies candidates from a number of sources, including executive search firms, or referrals from existing directors. When a vacancy occurs or is pending, the Governance Committee identifies a short list of potential candidates to pursue further, considering whether the candidates can devote sufficient time and resources to his or her duties as a Board member. The Governance Committee is required to retain an executive search firm or other third party expert to assist in completing reference and background checks on Board candidates. The Governance Committee may also engage

these firms and experts to assist in carrying out any of its duties required to be carried out in relation to recruitment. Pursuant to Board policies, the Governance Committee is required to maintain and update as needed, a list of potential Board candidates for planned and unplanned vacancies through the form of an ever-green list.

AN EVER-GREEN LIST OF POTENTIAL BOARD CANDIDATES IS MAINTAINED AND UPDATED AS NEEDED.

Throughout the process, the Governance Committee provides updates to the Board and solicits input on candidates. Candidates are interviewed by members of the committee and other directors as deemed appropriate. The Governance Committee ultimately provides its recommendation to the full Board of Directors, which approves a nominee for submission to shareholders for election to the Board.

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Retirement

THE CHIEF EXECUTIVE OFFICER AND OTHER MANAGEMENT DIRECTORS ARE REQUIRED TO LEAVE THE BOARD UPON THEIR RETIREMENT FROM SUNCOR. ALL OTHER DIRECTORS, ABSCENT EXCEPTIONAL CIRCUMSTANCES, MUST RETIRE AT THE SHAREHOLDER MEETING FOLLOWING HIS OR HER 72 ^ND BIRTHDAY.

The Board has adopted a Retirement and Change of Circumstance Policy. The policy provides that all directors, other than management directors, must retire from the Board upon completion of their term of office at the annual meeting of shareholders following their 72 ^nd birthday. The Governance Committee, in consultation with the chairman of the Board, has the authority under exceptional circumstances to recommend extension of the term of a Board member if the retirement of such director would not be in the best interests of Board continuity and effectiveness. Any such extension must be granted by the Board on the recommendation of the Governance Committee. The CEO and other management directors are required to leave the Board upon their retirement from Suncor.

Assessment of Directors

Suncor's Board Effectiveness Policy establishes an annual process (the "Evaluation Process") whereby directors are provided with an opportunity to evaluate the effectiveness of the Board, its committees, the chairman of the Board, committee chairs and Board members and to identify areas where effectiveness can be improved or enhanced in these areas. The Evaluation Process carried out in 2011 showed that all individuals and groups were effectively fulfilling their responsibilities.

THE BOARD HAS ESTABLISHED AN ANNUAL REVIEW PROCESS FOR THE BOARD, ITS COMMITTEES, THE CHAIRMAN, THE CHAIR OF EACH COMMITTEE AND ITS MEMBERS.

The Evaluation Process involves the solicitation of input from individual directors through an annual on-line survey presented in two parts: (i) the Suncor Energy Board, Chairman of the Board and Committee Effectiveness Evaluation Form (the "Board Effectiveness Survey"), which explores the directors' views and solicits feedbacks on how well he or she believes the Board and its committees, including its chairs, are performing; and (ii) the Director Peer Feedback Survey (the "Peer Survey"), which explores the directors' views and solicits feedback on their assessment of other directors' performance, including their contributions, accountability, knowledge, experience and demonstration of high ethical standards.

The Evaluation Process includes open-ended questions to allow directors to suggest improvement. The Board Effectiveness Survey asks each director whether he or she believes the Board and each of its committee is functioning as it should in accordance with its mandate and information obtained from the answers to these questions assists the Board in determining whether any of the Board or committee mandates need to be amended.

Board Effectiveness Review

Confidential responses are tabulated and analyzed by the Corporate Secretary and presented on a report which is circulated to the chair of the Governance Committee and chairman of the Board, who then work with the Corporate Secretary to summarize key items and recommendations for enhancing or strengthening effectiveness (including any recommendations arising from the one-on-one meetings described under "Peer Review" below). The recommendations are tabled, discussed and finalized at the Governance Committee meeting in January and timelines and action items are assigned at the meeting to track any follow-up to effect the recommendations. The chair of the Governance Committee reports to the full Board on the survey results, recommendations and action items at the January meeting of the Board and reports on the progress in completing those recommendations throughout the year. All materials distributed to the Governance Committee, including the consolidated report and recommendations, are made available for review by all directors.

Peer Review

The results of the Peer Survey are tabulated and consolidated by the Corporate Secretary and a summary report is circulated to the chair of the Governance Committee and chairman of the Board. Individual directors receive their personal results.

The chairman of the Board sets up one-on-one meetings with each director to discuss their peer review results and to receive the directors' input on governance, risk and strategy. The chairman of the Board discusses his own peer review results with the chair of the Governance Committee. The one-on-one meetings are completed prior to the Board and committee meetings held in January. This allows any input provided during the peer review on governance, risk and strategy, to be incorporated in the action plans arising from the Evaluation Process. Once the peer review meetings are completed, the chairman of the Board prepares a summary of key items arising from these discussions which are discussed in camera at the Governance Committee and with the meeting of the full Board.

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Compliance with NYSE Standards

Suncor's corporate governance practices meet or exceed all applicable Canadian Requirements and SEC Requirements. Except as disclosed below, Suncor's corporate governance practices are in compliance with NYSE Standards in all significant respects.

•: Approval of Equity Compensation Plans. Suncor is not required to and does not comply with Section 303A.08 of the NYSE Listed Company Manual which requires shareholder approval of all equity compensation plans and any material revisions thereto, regardless of whether the securities to be delivered under them are newly issued or purchased on the open market. The TSX rules, applicable to Suncor, only require shareholder approval for certain of Suncor's plans in accordance with a specific amendment provision, as approved by shareholders at the 2007 annual and special meeting and by the TSX. See "Summary of Incentive Plans" on page 48 of the Circular.
•: Independence Standards. The Board of Directors is responsible for determining whether or not each director is independent. In making this determination, the Board has adopted the definition of "independence" as set forth in Canadian Requirements (specifically National Instrument 52-110 – Audit Committees ) and SEC Requirements (specifically Rule 10A-3 under the U.S. Securities Exchange Act of 1934 , as amended). The Board has not adopted the director independence standards contained in Section 303A.02 of the NYSE's Listed Company Manual.

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SCHEDULE D: POSITION DESCRIPTION FOR INDEPENDENT BOARD CHAIR

The following principles shape the position description and duties for the Chairman of the Board of Directors of Suncor Energy Inc.:

1.: The Board's overarching duty is to supervise the management of Suncor's business and affairs.
2.: Suncor is committed to establishing and maintaining a well developed governance process involving the Board, Board committees and management.
3.: Active involvement and substantive debate are encouraged.
4.: The Board supports the separation of the role of Chairman from the role of Chief Executive Officer (CEO).
5.: The Board is involved in strategic policy issues.
6.: The Board will strive to be the best.

With the foregoing in mind, the framework for Board Chairman will be:

•: The Chairman of the Board is the chief officer of the Board, appointed annually by the Board with remuneration as determined by the Board. The Chairman is not an employee or officer of the Corporation and will be independent of management. The Chairman will foster and promote the integrity of the Board and a culture where the Board works harmoniously for the long-term benefit of the Corporation and its shareholders.
•: The Chairman will preside at meetings of the Board and at meetings of the shareholders of the Corporation, as provided for in the by-laws of the Corporation.
•: The Chairman will serve on the Governance Committee of the Board. The Governance Committee, by its mandate, assists the Board in matters pertaining to governance, including the organization and composition of the Board, the organization and conduct of Board meetings, and the effectiveness of the Board of Directors, Board committees, and individual directors, in fulfilling their responsibilities. The Chairman is also, by standing invitation, an ex-officio of those committees of the Board of which he is not a listed member.
•: The Chairman will be kept well informed on the major affairs and operations of the Corporation, on the economic and political environment in which it operates and will maintain regular contact with the CEO and other senior executive officers of the Corporation.

The accountabilities of the Chairman include:

Shareholder Meetings

•: Subject to the by-laws, chair all shareholder meetings.
•: Review and approve minutes of all shareholder meetings.

Manage the Board

•: Subject to the by-laws, chair all Board meetings.
•: Provide leadership to the Board.
•: In conjunction with the Governance Committee, ensure that processes to govern the Board's work are effective to enable the Board to exercise oversight and due diligence in the fulfillment of its mandate.
•: Identify guidelines for the conduct and performance of directors.
•: Manage director performance.
•: With the assistance of the corporate secretary and CEO, oversee the management of Board administrative activities (meeting schedules, agendas, information flow and documentation).
•: Facilitate communication among directors.
•: Attend committee meetings as deemed appropriate.
•: Review and approve minutes of all Board meetings prior to presentation to the Board for approval.

Develop a More Effective Board

•: Working with the Governance Committee, plan Board and Board committee composition, recruit directors, and plan for director succession.

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•: Working with the Governance Committee, participate in the Board effectiveness evaluation process and meet with individual directors to provide constructive feedback and advice.
•: Review any change in circumstance of individual directors and determine whether directors' other commitments conflict with their duties as directors of Suncor; review requests from the CEO to sit on the Board of Directors of outside business organizations.
•: Review and approve requests from directors under the Board's Directors Continuing Education Policy.

Work with Management

•: Support and influence strategy.
•: With the assistance of the Human Resources and Compensation Committee, lead the Board in evaluating the performance of the CEO.
•: Review the CEO's expenses on a quarterly basis.
•: Build relationships at the senior management level.
•: Provide advice and counsel to the CEO.
•: Serve as an advisor to the CEO concerning the interests of the Board and the relationship between management and the Board.

Liaise with Stakeholders

•: Share Suncor's views with other boards and organizations when required.
•: Although primary responsibility for the Corporation's relationships with the financial community, the press and other external stakeholders rests with the CEO, the Chairman may be requested, from time to time, to attend meetings with outside stakeholders.

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SCHEDULE E: DIRECTOR INDEPENDENCE POLICY AND CRITERIA

BACKGROUND:

Corporate governance guidelines provide that boards of directors should have a majority of independent directors, and that the board chairman should be independent.

The purpose of this independence policy and criteria is to state the criteria by which the Board of Directors (the "Board") of Suncor Energy Inc. ("Suncor") determines whether each of its directors is or is not independent.

INDEPENDENCE POLICY:

Pursuant to the terms of reference for the Board, a majority of the Board must be independent, and in addition, the Audit, Governance, and Human Resources and Compensation Committees, shall be comprised solely of independent directors. The Governance Committee will conduct an annual review of the status of each director and director nominee in light of the following criteria for independence, and will recommend to the Board in order that the Board may affirmatively determine the status of each such individual. In making independence determinations, the Board shall consider all relevant facts and circumstances. Material relationships can include commercial, industrial, banking, consulting, legal, accounting, charitable and familial relationships. The key concern when assessing independence is independence from management.

INDEPENDENCE CRITERIA:

A director of Suncor will be considered independent only if the Board has affirmatively determined that the director has no material relationship with Suncor, either directly or as a partner, shareholder or officer of an organization that has a material relationship with Suncor. A "material relationship" is one which could, in the view of the Board, be reasonably expected to interfere with the exercise of the director's independent judgment (CSA National Instrument 52-110).

Notwithstanding the foregoing, a director will NOT be considered independent if ⁽¹⁾ :

•: The director is, or has been within the last three years, an employee or executive officer of Suncor, or an immediate family member is or has been within the last three years, an executive officer, of Suncor.
•: The director has received, or an immediate family member has received, during any 12-month period within the last three years, more than $75,000 in direct compensation from Suncor, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service) and other than compensation received by any immediate family member for service as an employee of Suncor (other than an executive officer).
•: The director or an immediate family member is a current partner of a firm that is Suncor's internal or external auditor; a director is a current employee of such a firm; or a director's immediate family member is a current employee of such a firm and participates in the firm's audit, assurance or tax compliance (but not tax planning) practice; or a director or an immediate family member who was within the last three years (but is no longer) a partner or employee of such a firm and personally worked on Suncor's audit within that time. For the purposes of this point ONLY, "immediate family member" means a spouse, minor child or stepchild, adult child or stepchild sharing a home with the director.
•: The director or any immediate family member is or has been within the last three years employed, as an executive officer of another corporation where any of Suncor's current executive officers at the same time serve on that corporation's compensation committee.
•: The director is a current employee, or an immediate family member is a current executive officer, of a corporation that has made payments to, or received payments from, Suncor, for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million, or 2% of such other corporation's consolidated gross revenues.
•: Contributions to tax exempt organizations shall not be considered "payments" for the purposes of these rules, provided that Suncor shall disclose in its proxy circular such contributions made to any tax exempt organization in which a director serves as an executive officer, if within the preceding three years, contributions in any single fiscal year from Suncor to the organization exceeded the greater of $1 million, or 2% of such organization's consolidated gross reserves.

(1): Unless otherwise noted, "immediate family member" is defined to include a person's spouse, parents, children, siblings, mothers and fathers in law, sons and daughters in law, brothers and sisters in law, and anyone other than domestic employees who shares such person's home.
•: For Audit Committee members only, in order to be considered independent, a member of the Audit Committee may not, other than in his or her capacity as a member of the Audit Committee, the Board or any other Board Committee, accept directly or indirectly any consulting, advisory, or other compensatory fee from Suncor, provided that compensatory fees do not include the receipt of fixed amounts of compensation under a retirement plan (including deferred compensation) for prior service with Suncor provided that such compensation is not contingent in any way on continued service; and in addition, shall not be an affiliated person of Suncor or any of its subsidiaries.

A director of Suncor will not be considered to have a material relationship with Suncor solely because the individual or his or her immediate family member:

•: Has previously acted as an interim CEO of Suncor; or
•: Acts, or has previously acted, as chair or vice chair of the Board or of any Board committees on a part-time basis; or
•: Sits on the board of directors or as a trustee or in an equivalent capacity, of another corporation, firm or other entity, which has a business relationship with Suncor, provided that the individual's remuneration from the other entity is not personally material to that individual or dependent on or variable with the nature or extent of the business relationship with Suncor, the individual is not involved in negotiating, managing, administering or approving contracts between Suncor and the other entity, and the individual otherwise is in compliance with the Board's conflict of interest policy with respect to contracts between Suncor and that other entity.

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SCHEDULE F: BOARD TERMS OF REFERENCE

PART I: OVERVIEW

The Canada Business Corporations Act (the Act), Suncor Energy's governing statute, provides "that the directors shall manage or supervise the management of the business and affairs of a corporation...". In practice, as a Board of Directors cannot "manage" a corporation such as Suncor Energy in the sense of directing its day-to-day operations, the overarching role and legal duty of Suncor's Board of Directors is to "supervise" the management of Suncor's business and affairs. Accordingly, the Board of Directors oversees development of the overall strategic direction and policy framework for Suncor Energy. This responsibility is discharged through Board oversight of Suncor Energy's management, which is responsible for the day-to-day conduct of the business. The Board, through the Chief Executive Officer (CEO), sets standards of conduct, including the Corporation's general moral and ethical tone, compliance with applicable laws, standards for financial practices and reporting, qualitative standards for operations and products and other standards that reflect the views of the Board as to the conduct of the business in the best interests of the Corporation.

In general, then, the Board is responsible for the selection, monitoring and evaluation of executive management, and for overseeing the ways in which Suncor Energy's business and affairs are managed. In this way, the Board assumes responsibility for the stewardship of the Corporation. Specific responsibilities which facilitate the discharge of the Board's stewardship responsibilities include: the strategic planning process, risk identification and management, ensuring that effective stakeholder communication policies are in place, and ensuring the integrity of internal controls and management information systems. These responsibilities, and others, are addressed in more detail in the Board's Mandate, comprising Part IV of these Terms of Reference.

The Board of Directors discharges its responsibilities with the assistance of Board committees. The committees advise and formulate recommendations to the Board, but do not, except in limited and specifically identified circumstances, have the authority to approve matters on behalf of the Board of Directors. General guidelines relating to Board committees comprise Part III of these Terms of Reference. In addition, each committee has a written mandate, setting out the scope of its operations, and its key roles and responsibilities. Position descriptions of the Board Committee Chairs and the Board of Directors Chairman set out the related principles, framework and accountabilities for those key roles in Suncor's Board governance.

The CEO of Suncor Energy is delegated the responsibility for the day-to-day management of the Corporation and for providing the Corporation with leadership. The CEO discharges these responsibilities by formulating Corporation policies and proposed actions, and, where appropriate, presenting them to the Board for approval. The Corporation's Management Control Process Policy explicitly identifies actions which have been specifically delegated to the CEO, and those which are reserved to the Board of Directors. In addition, the Board has plenary power, and has the power to specify and modify the authority and duties of management as it sees fit with a view to Suncor Energy's best interests and in accordance with current standards. The Act also identifies certain matters which must be considered by the Board as a whole and may not be delegated to a committee or to management. These matters include:

•: any submission to the shareholders of a question or matter requiring the approval of the shareholders;
•: the filling of a vacancy among the directors or in the office of the external auditor;
•: the manner of and terms for the issuance of securities;
•: the declaration of dividends;
•: the purchase, redemption or any other form of acquisition of shares issued by the Corporation;
•: the payment of a commission to any person in consideration of the purchase or agreement to purchase shares of the Corporation from the Corporation or from any other person, or procuring or agreeing to procure purchasers for any such shares;
•: the approval of management proxy circulars;
•: the approval of any take-over bid circular or directors' circular;
•: the approval of the audited annual financial statements of the Corporation; and
•: the adoption, amendment or repeal of by-laws of the Corporation.

One of the key stewardship responsibilities of the Board is to approve the Corporation's goals, strategies and plans, and the fundamental objectives and policies within which the business is operated, and evaluate the performance of executive management. Once the Board has approved the goals, strategies and plans, it acts in a unified and cohesive manner in supporting and guiding the CEO. The CEO keeps the Board fully informed of the progress of the Corporation toward the achievement of its goals, strategies and plans, in a timely and candid manner, and the Board of Directors continually evaluates the performance of executive management toward these achievements.

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PART II: BOARD GUIDELINES

The following have been adopted by the Board as the guidelines applicable to the Board and its operations:

•: These Terms of Reference for the Board of Directors (which include the Board Guidelines, Committee Guidelines, Board Mandate and Board Forward Agenda, setting out the important issues that must be addressed by the Board of Directors annually), and the mandates and forward agendas of the Board committees, constitute the charters of the Board and committees respectively, and are reviewed by the Board annually and updated as deemed appropriate. These charters are supplemented by the position descriptions for the Board Chairman and Board Committee Chairs, as well as the Director Accountability Statement.
•: The CEO is responsible for leading the development of long-range plans for the Corporation, including its goals and strategies. The Board, both directly and through its committees, participates in discussions of strategy, by responding to and contributing ideas. The Board annually reviews and approves the Corporation's annual business plan (including the annual budget), and approves the strategies as reflected in the Corporation's long range plan.
•: The Board believes that the appropriate size for the Board is between 10 and 14 members.
•: Directors stand for re-election annually.
•: The Board maintains a Mandatory Retirement and Change of Circumstance Policy and reviews the policy periodically to ensure it continues to serve the Corporation's best interests. The Board maintains a policy permitting directors to retain outside advisors at the expense of the Corporation, subject to the written approval of any of the Board Chairman, the Chair of the committee proposing to retain outside advisors, or the Governance Committee. In exercising their approval authority, the Board Chairman, Board Committee Chair or Governance Committee, as the case may be, will establish, on a case by case basis, reasonable monetary limits and other controls as deemed appropriate.
•: In order to support the alignment of Directors' interests with those of Suncor's shareholders, Directors shall own during the term of their directorship within five years of being appointed or elected to the Board, a minimum value of Suncor common shares, DSUs or any combination thereof, as determined annually by the Human Resources and Compensation Committee.
•: The Board should be comprised of a majority of independent directors. The Board has defined an independent director in written independence criteria, based on definitions in the Canadian Requirements and the SEC Requirements ⁽¹⁾ . On an annual basis, the Board of Directors shall consider and affirmatively determine whether each individual director is independent, in accordance with the criteria.
•: The membership of the CEO on the Board of Directors is valuable and conducive to effective decision making. However, there should generally be no more than three inside ⁽²⁾ directors on the Board of Directors.
•: The Board supports the separation of the role of Chairman from the role of CEO.
•: The Board will evaluate the performance of the CEO at least annually. The evaluation will be based on criteria which includes the performance of the business and the accomplishment of CEO's qualitative and quantitative objectives as established at the beginning of each fiscal year of the Corporation, and the creation and fostering within the Corporation of a culture of integrity.
•: The Board Chairman will work with the CEO to establish the agenda for each Board meeting. Each Board member is free to suggest the inclusion of items on the agenda. Whenever feasible, important issues should be dealt with over the course of two meetings. The first such meeting would allow for a thorough briefing of the Board, and the second would allow for final discussion and a decision.
•: The Board will hold at least five meetings per year, one of which shall be principally devoted to strategy. An additional meeting shall be scheduled for approval of the annual proxy circular, annual information form and other annual disclosure documents, as necessary.
•: Whenever feasible, the Board will receive materials at least one full weekend in advance of meetings. Presentations on specific subjects at Board meetings will only briefly summarize the material sent so discussion at the meeting can focus on questions and issues. Directors are expected to have reviewed these materials prior to attendance at Board and committee meetings, and are expected to be prepared to engage in meaningful discussion and provide considered, constructive and thoughtful feedback and commentary at meetings.
•: Board meeting dates will be established sufficiently in advance (at least one year and longer if practical) to minimize conflict with other commitments on Directors' schedules. Directors are accordingly expected to make every reasonable effort to attend all meetings of the Board and its committees, if not in person then by telephone.

(1): Suncor's corporate governance practices reflect applicable rules and guidelines adopted by the Canadian Securities Administrators (the "Canadian Requirements") and the U.S. Securities and Exchange Commission ("SEC"), including applicable rules adopted by the SEC to give effect to the provisions of the Sarbanes-Oxley Act of 2002 (collectively, the "SEC Requirements").
(2): An inside director is an officer (other than an officer serving as such in a non-executive capacity) or employee of the Corporation.

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•: While the Board does not restrict the number of public company boards that a director may serve on, each director should ensure that he or she is able to devote sufficient time and energy to carrying out their duties effectively.
•: The Board encourages the CEO to bring other executive officers into Board meetings. The presence of such executives is expected to bring additional insights into the discussions, because of the executives' personal involvement in, and knowledge of, specific agenda items. The benefit of exposing the Board to other executives, for succession planning and career development purposes, is recognized.
•: The Board is responsible for selecting its own members, and for assessing the performance of individual directors, as well as the effectiveness of Board committees and the Board of Directors as a whole. The Board delegates management of the selection processes to the Governance Committee. The Governance Committee has established a policy for director selection. The selection process includes consideration of the competencies and skills the Board, as a whole, should possess, against those of existing directors, and a consideration of the competencies and skills each new nominee will bring to the Board, as well as their ability to devote sufficient time and attention to fulfilling the role of director. The Board ultimately determines nominees that will be included in the Corporation's management proxy circular.
•: The outgoing Chairman of the Board, or in the absence of the outgoing Chairman, a director elected by resolution of the Board, shall manage the process of electing a new Chairman by seeking nominations, determining the willingness of each nominee to take on the role of Chairman of the Board, and by presiding over an election by secret ballot.
•: The Board supports the principle that its membership should represent a diversity of backgrounds, experience and skills.
•: Succession and management development plans will be reviewed by the Human Resources & Compensation Committee, and reported on annually to the Board.
•: At the conclusion of each Board meeting, the Board of Directors shall meet on an "in camera" basis without management. Such in camera meetings shall be presided over by the independent Chairman. In addition, at least once annually, the independent directors will meet in the absence of both management and non-independent directors.
•: At least once annually, the Board will meet at a Suncor Energy location other than the head office location. The purpose is to facilitate continual exposure of Board members to the Corporation's operations and the communities in which they are carried out.

PART III: COMMITTEE GUIDELINES

•: The Board has four standing committees: the Audit Committee, the Governance Committee, the Human Resources and Compensation Committee ("HR&CC"), and the Environment, Health, Safety & Sustainable Development Committee ("EHS&SD"). From time to time the Board may create ad hoc committees to examine specific issues on behalf of the Board. Each committee maintains a written mandate and reviews that mandate annually. Any recommendations to amend committee mandates are reviewed by the Governance Committee for recommendation to the Board of Directors.
•: The Governance Committee, with input from the Chairman of the Board, plans Board committee appointments (including the designation of a committee Chair) for recommendation to and appointment by the Board. The committees shall be reconstituted annually following the annual general meeting at which directors are elected by the shareholders of the Corporation. In accordance with the Corporation's By-laws, unless otherwise determined by resolution of the Board of Directors, a majority of the members of a committee shall constitute a quorum for meetings of committees.
•: Each committee shall be comprised of a minimum of three and a maximum of six directors. Each committee shall have a non-member Secretary who may be a member of management of the Corporation. The Chair of each committee, in consultation with the committee Secretary, shall determine the agenda for each committee meeting.
•: The Board supports the principle that committee Chairs should be rotated regularly while preserving continuity.
•: Except where otherwise specified in these terms of reference or in the Corporation's By-laws, each committee shall have the power to determine its own rules of procedure.
•: The Audit Committee will consist entirely of outside, independent ⁽³⁾ directors. In addition, all members of the Audit committee must be, in the judgment of the Board of the Directors, financially literate ⁽⁴⁾ , and at least one member of the Audit Committee must be an audit committee financial expert ⁽⁵⁾ .
•: In general Audit Committee members will not simultaneously be members of the Audit Committee of more than two other public companies, unless the Board of Directors affirmatively determines that simultaneous service on a greater number of audit committees would not impair the member's ability to effectively serve on Suncor's Audit Committee. Any such determination by the Board of Directors shall be disclosed in the Corporation's management proxy circular.
•: The HR&CC will consist entirely of outside, independent directors.

(3): See note 1
(4): See Appendix A
(5): See Appendix A

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•: The Governance Committee shall consist entirely of outside, independent directors.
•: The Chairman, by standing invitation, is considered an ex-officio of those committees of the Board of which he is not a listed member.
•: At the conclusion of each committee meeting, the committee shall meet on an "in camera" basis without management. Such in camera meetings shall be presided over by the Chair of the committee, if an independent director, or other committee member who is an independent director, as selected by the independent directors on the committee.

PART IV: MANDATE OF THE BOARD OF DIRECTORS

Goals of the Board

The major goals and responsibilities of the Board are to:

•: Establish policy direction and the fundamental objectives of the Corporation;
•: Supervise the management of the business and affairs of Suncor Energy;
•: Ensure the Corporation has an effective strategic planning process;
•: Identify the principal risks of Suncor Energy's business, and ensure that there are systems in place to effectively monitor and manage these risks;
•: Annually approve the strategies reflected in Suncor's long range plan, which takes into account, among other things, the opportunities and risks of the Corporation's business;
•: Protect and enhance the assets of the owners of the Corporation and look after their interests in general;
•: Ensure the continuity of the Corporation by assuming responsibility for the appointment of and succession to the office of the CEO, enforcing the articles and by-laws and by seeing that an effective Board is maintained;
•: Make certain decisions that are not delegable, such as the declaration of dividends; and
•: Provide leadership and direction for the Corporation in establishing and maintaining a high standard of corporate ethics and integrity.

Major Duties

The major duties of the Board are to:

1.

Foster the long-term success of Suncor Energy. Commit to the enterprise and acknowledge that the best interests of Suncor Energy and its shareholders must prevail over any individual business interests of the membership of the Board. Represent and safeguard the interests of all shareholders while recognizing that the interests of employees, customers, suppliers, and especially the general public must also be taken into account for the enterprise to continue being able to serve its owners. Monitor and work to improve return on, security of, and prospects for enhancement of the value of shareholder investment.

2.

Determine and control in broad terms the purposes, goals, activities and general characteristics of Suncor Energy. These duties range from establishing objectives, scope of operations, and fundamental strategies and policies and annually approving Suncor's annual budget and the strategies reflected in its long range plan, to declaring dividends, approving annual budgets, major capital investments, mergers and acquisitions, issuance or retirement of stock, and other specific actions that are likely to have a substantial effect on the Corporation or that the Board is legally required to take.

3.

Review with management the mission of the Corporation, its objectives and goals, and the strategies whereby it proposes to achieve them. Monitor the Corporation's progress toward its goals and plans, and assume responsibility to revise and alter the Corporation's direction where warranted.

4.

Appoint a CEO, monitor and evaluate his performance, provide for adequate succession to that position, and replace the CEO when appropriate. Appoint as well the other officers of the Corporation, and in respect of the senior officers, monitor their performance, that there is adequate succession to their positions, and that they are replaced when appropriate.

5.

Ensure that the CEO is providing for achievement of acceptable current financial results relative to corporate objectives, budgets, and the economic environment, and the development of resources necessary to future success. These resources include:

•: management competence, organization and depth;
•: technology in exploration, production, mining, manufacturing, product design and product application;
•: fixed assets;
•: marketing capability – customer loyalty, distribution organization, market knowledge and so on;
•: work force and employee relations;

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•: financial resources, including relations with the financial community; and
•: reputation.

6.

Establish an overall compensation policy for the Corporation and monitor its implementation with special attention devoted to the executive group. Review the policy from time to time to ensure that it continues to be appropriate.

7.

Oversee corporate financial operations, including:

•: capital structure management, maintaining reasonable financial flexibility and safety while achieving an appropriate return on equity;
•: financial results reporting;
•: allocation of assets, providing for increasing investment in areas of high return while withdrawing funds from areas producing inadequate returns;
•: maintaining access to suitable sources of new capital;
•: pension funds and other major employee benefit programs;
•: dividend pay-out policy and action;
•: selection of outside auditors for approval by the shareholders; and
•: insurance.

8.

Identify the principal risks of the Corporation's business and ensure implementation and monitoring of systems to effectively manage these risks.

9.

Ensure that processes are in place to monitor and maintain the integrity of the Corporation's internal control and management information systems.

10.

Ensure that the Corporation has in place appropriate environmental, health and safety policies, having regard to legal, industry and community standards, and ensure implementation of management systems to monitor the effectiveness of those policies.

11.

Ensure that systems are in place for communication and relations with stakeholder groups, including, but not limited to, shareholders, the investing public, government, employees, the financial community, and the communities in which Suncor Energy operates. Ensure that measures are in place for receiving feedback from stakeholders, including toll free telephone and internet email communication channels that are adequately resourced to respond to appropriate enquiries. Monitor system effectiveness and significant sensitive and legally required communications.

12.

Ensure that the Corporation has systems in place which accommodate stakeholder feedback.

13.

Collectively and individually respond constructively to requests for advice and assistance from the CEO. Provide leadership and policy direction to management with a view to establishing and maintaining a high standard of legal and ethical conduct for the Corporation, by:

•: taking reasonable steps to ensure that Suncor Energy complies with applicable laws and regulations and with its constating documents, including its Articles and By-laws, and operates to high ethical and moral standards – being on the alert for and sensitive to situations that could be considered illegal, unethical or improper, and taking corrective steps;
•: establishing the means of monitoring performance in this area with assistance of legal counsel;
•: approving and monitoring compliance with key policies and procedures by which the Corporation is operated; complying with the legal requirements, including those pursuant to the Canada Business Corporations Act, applicable to corporate boards of directors, including, without limitation, the duty to act honestly and in good faith with a view to the best interests of the Corporation, and the duty to exercise the care, diligence and skill that reasonably prudent people exercise in comparable circumstances.

14.

Manage Board operations, including, without limitation:

•: subject to any required shareholder approval, fix the size of the Board, review its composition and, when appropriate, identify new nominees to the Board;
•: elect a Chairman, appropriate committees and Committee Chairs;
•: define the duties of the Chairman of the Board and the committees;
•: determine when and where the Board meets;
•: influence the structuring of agendas and how meeting time is spent; and
•: meet legal requirements with respect to corporate administration.

F-5 SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR

APPENDIX A TO THE TERMS OF REFERENCE – FINANCIAL LITERACY AND EXPERTISE

For the purpose of making appointments to the Corporation's Audit Committee, and in addition to the independence requirements, all Directors nominated to the Audit Committee must meet the test of Financial Literacy as determined in the judgment of the Board of Directors. Also, at least one director so nominated must meet the test of Financial Expert as determined in the judgment of the Board of Directors.

Financial Literacy

Financial Literacy can be generally defined as the ability to read and understand a balance sheet, an income statement and a cash flow statement. In assessing a potential appointee's level of Financial Literacy the Board of Directors must evaluate the totality of the individual's education and experience including:

•

The level of the person's accounting or financial education, including whether the person has earned an advanced degree in finance or accounting;

•

Whether the person is a professional accountant, or the equivalent, in good standing, and the length of time that the person actively has practiced as a professional accountant, or the equivalent;

•

Whether the person is certified or otherwise identified as having accounting or financial experience by a recognized private body that establishes and administers standards in respect of such expertise, whether that person is in good standing with the recognized private body, and the length of time that the person has been actively certified or identified as having this expertise;

•

Whether the person has served as a principal financial officer, controller or principal accounting officer of a company that, at the time the person held such position, was required to file reports pursuant to securities laws, and if so, for how long;

•

The person's specific duties while serving as a public accountant, auditor, principal financial officer, controller, principal accounting officer or position involving the performance of similar functions;

•

The person's level of familiarity and experience with all applicable laws and regulations regarding the preparation of financial statements that must be included in reports filed under securities laws;

•

The level and amount of the person's direct experience reviewing, preparing, auditing or analyzing financial statements that must be included in reports filed under provisions of securities laws;

•

The person's past or current membership on one or more audit committees of companies that, at the time the person held such membership, were required to file reports pursuant to provisions of securities laws;

•

The person's level of familiarity and experience with the use and analysis of financial statements of public companies; and

•

Whether the person has any other relevant qualifications or experience that would assist him or her in understanding and evaluating the Corporation's financial statements and other financial information and to make knowledgeable and thorough inquiries whether:

•: The financial statements fairly present the financial condition, results of operations and cash flows of the Corporation in accordance with generally accepted accounting principles; and
•: The financial statements and other financial information, taken together, fairly present the financial condition, results of operations and cash flows of the Corporation.

Audit Committee Financial Expert

An "Audit Committee Financial Expert" means a person who in the judgment of the Corporation's Board of Directors, has following attributes:

a.: an understanding of Canadian generally accepted accounting principles and financial statements;
b.: the ability to assess the general application of such principles in connection with the accounting for estimates, accruals, and reserves;
c.: experience preparing, auditing or analyzing or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by Suncor's financial statements, or experience actively supervising one or more persons engaged in such activities;
d.: an understanding of internal controls and procedures for financial reporting; and
e.: an understanding of audit committee functions.

A person shall have acquired the attributes referred to in items (a) through (e) inclusive above through:

a.: education and experience as a principal financial officers, principal accounting officer, controller, public accountant or auditor or experience in one or more positions that involve the performance of similar functions;
b.: experience actively supervising a principal financial officer, principal accounting officer, controller, public accountant, auditor or person performing similar functions;
c.: experience overseeing or assessing the performance of companies or public accountants with respect to the preparation, auditing or evaluation of financial statements; or
d.: other relevant experience.

SUNCOR ENERGY INC. 2012 MANAGEMENT PROXY CIRCULAR F-6

If you are looking for Suncor's 2011 annual report and you haven't
received it in the mail, you may not have confirmed you wanted to
receive it. Our 2011 annual report is available electronically on
Suncor's web site at www.suncor.com. Or if you would like to
receive a printed copy, please call 1-800-558-9071.


Box 2844, 150 - 6th Avenue S.W., Calgary, Alberta, Canada T2P 3E3 tel: (403) 296-8000 fax: (403) 296-3030 info@suncor.com www.suncor.com

QuickLinks

Exhibit 4.5

Consolidated Statements of Comprehensive Income
(unaudited)


		Three months ended March 31
($ millions)		2012		2011

Revenues and Other Income
	Operating revenues, net of royalties (note 3)	9 653		8 943
	Other income (note 4)	105		132

		9 758		9 075

Expenses
	Purchases of crude oil and products	3 996		3 489
	Operating, selling and general	2 454		2 291
	Transportation	156		167
	Depreciation, depletion, amortization and impairment	947		785
	Exploration	45		58
	Loss (gain) on disposal of assets	(31	)	251
	Project start-up costs	1		37
	Financing expenses (income) (note 7)	(82	)	(49	)

		7 486		7 029

Earnings before Income Taxes		2 272		2 046

Income Taxes
	Current	497		416
	Deferred (note 8)	318		602

		815		1 018

Net Earnings		1 457		1 028

Other Comprehensive Income (Loss)
	Foreign currency translation adjustment	(50	)	37
	Foreign currency translation reclassified to net earnings	—		14
	Actuarial gain (loss) on employee retirement benefit plans, net of income taxes of $9 (2011 – $4)	(9	)	18

Other Comprehensive Income (Loss)		(59	)	69

Total Comprehensive Income		1 398		1 097

Per Common Share (dollars) (note 9)
	Net earnings – basic	0.93		0.65
	Net earnings – diluted	0.93		0.65
	Cash dividends	0.11		0.10

See accompanying notes to the interim consolidated financial statements.

Suncor Energy Inc.
2012 First Quarter 043

Consolidated Balance Sheets
(unaudited)


($ millions)			Mar 31 2012	Dec 31 2011

Assets
	Current assets
		Cash and cash equivalents	4 648	3 803
		Accounts receivable	5 015	5 412
		Inventories	3 716	4 205
		Income taxes receivable	670	704

	Total current assets		14 049	14 124
	Property, plant and equipment, net		53 769	52 589
	Exploration and evaluation		3 940	4 554
	Other assets		314	311
	Goodwill and other intangible assets		3 137	3 139
	Deferred income taxes		64	60

Total assets			75 273	74 777

Liabilities and Shareholders' Equity
	Current liabilities
		Short-term debt	749	763
		Current portion of long-term debt	12	12
		Accounts payable and accrued liabilities	6 947	7 755
		Current portion of provisions	1 082	811
		Income taxes payable	1 077	969

	Total current liabilities		9 867	10 310
	Long-term debt		9 853	10 004
	Other long-term liabilities		2 188	2 392
	Provisions		3 620	3 752
	Deferred income taxes		10 053	9 719
	Shareholders' equity		39 692	38 600

	Total liabilities and shareholders' equity		75 273	74 777

See accompanying notes to the interim consolidated financial statements.

Suncor Energy Inc.
044 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

Consolidated Statements of Cash Flows
(unaudited)


		Three months ended March 31
($ millions)		2012		2011

Operating Activities
Net earnings		1 457		1 028
Adjustments for:
	Depreciation, depletion, amortization and impairment	947		785
	Deferred income taxes	318		602
	Accretion	46		38
	Unrealized foreign exchange gain on U.S. dollar denominated long-term debt	(146	)	(186	)
	Change in fair value of derivative contracts	(39	)	(55	)
	Loss (gain) on disposal of assets	(31	)	251
	Share-based compensation	45		173
	Exploration	—		2
	Settlement of decommissioning and restoration liabilities	(166	)	(138	)
	Other	(5	)	(107	)
Decrease in non-cash working capital		48		125

Cash flow provided by operating activities		2 474		2 518

Investing Activities
Capital and exploration expenditures		(1 478	)	(1 576	)
Acquisitions		—		(842	)
Proceeds from disposal of assets		37		2 690
Other investments		—		5
Decrease in non-cash working capital		87		816

Cash flow provided by (used in) investing activities		(1 354	)	1 093

Financing Activities
Net change in short-term debt		(14	)	(1 232	)
Net change in long-term debt		(5	)	(4	)
Issuance of common shares under share option plans		99		168
Purchase of common shares for cancellation (note 6)		(183	)	—
Dividends paid on common shares		(167	)	(153	)

Cash flow used in financing activities		(270	)	(1 221	)

Increase in Cash and Cash Equivalents		850		2 390
Effect of foreign exchange on cash and cash equivalents		(5	)	(2	)
Cash and cash equivalents at beginning of period		3 803		1 077

Cash and Cash Equivalents at End of Period		4 648		3 465

Supplementary Cash Flow Information
Interest paid		64		101
Income taxes paid		368		308

See accompanying notes to the interim consolidated financial statements.

Suncor Energy Inc.
2012 First Quarter 045

Consolidated Statements of Changes in Shareholders' Equity
(unaudited)


($ millions)	Share Capital		Contributed Surplus		Foreign Currency Translation		Cash Flow Hedges	Retained Earnings		Total		Number of Common Shares (thousands)

At December 31, 2010	20 188		507		(451	)	14	14 934		35 192		1 565 489

Net earnings	—		—		—		—	1 028		1 028		—
Foreign currency translation adjustment	—		—		51		—	—		51		—
Actuarial gain on employee retirement benefit plans	—		—		—		—	18		18		—

Total comprehensive income	—		—		51		—	1 046		1 097		—
Issued under share option plans	262		(41	)	—		—	—		221		7 405
Issued under dividend reinvestment plan	4		—		—		—	(4	)	—		99
Share-based compensation	—		43		—		—	—		43		—
Dividends paid on common shares	—		—		—		—	(153	)	(153	)	—

At March 31, 2011	20 454		509		(400	)	14	15 823		36 400		1 572 993



At December 31, 2011	20 303		545		(207	)	14	17 945		38 600		1 558 636

Net earnings	—		—		—		—	1 457		1 457		—
Foreign currency translation adjustment	—		—		(50	)	—	—		(50	)	—
Actuarial loss on employee retirement benefit plans	—		—		—		—	(9	)	(9	)	—

Total comprehensive income	—		—		(50	)	—	1 448		1 398		—
Issued under share option plans	145		(31	)	—		—	—		114		5 428
Issued under dividend reinvestment plan	6		—		—		—	(6	)	—		162
Purchase of common shares for cancellation (note 6)	(71	)	—		—		—	(112	)	(183	)	(5 466	)
Liability for share purchase commitment (note 6)	(44	)	—		—		—	(66	)	(110	)	—
Share-based compensation	—		40		—		—	—		40		—
Dividends paid on common shares	—		—		—		—	(167	)	(167	)	—

At March 31, 2012	20 339		554		(257	)	14	19 042		39 692		1 558 760

See accompanying notes to the interim consolidated financial statements.

Suncor Energy Inc.
046 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

1. REPORTING ENTITY AND DESCRIPTION OF THE BUSINESS

Suncor Energy Inc. (Suncor or the company) is an integrated energy company headquartered in Canada. Suncor's operations include oil sands development and upgrading, onshore and offshore oil and gas production, petroleum refining, and product marketing primarily under the Petro-Canada brand. The consolidated financial statements of the company comprise the company and its subsidiaries and the company's interests in associates and jointly controlled entities.

The address of the company's registered office is 150 - 6th Avenue S.W., Calgary, Alberta, Canada, T2P 3E3.

2. BASIS OF PREPARATION

(a) Statement of Compliance

These condensed consolidated interim financial statements have been prepared in accordance with Canadian generally accepted accounting principles, specifically International Accounting Standard 34 Interim Financial Reporting as issued by the International Accounting Standards Board. They are condensed as they do not include all of the information required for full annual financial statements, and they should be read in conjunction with the consolidated financial statements for the year ended December 31, 2011.

The policies applied in these condensed interim consolidated financial statements are based on International Financial Reporting Standards (IFRS) issued and outstanding as at April 30, 2012, the date the Audit Committee approved these statements on behalf of the Board of Directors.

(b) Basis of Measurement

The consolidated financial statements are prepared on a historical cost basis except as detailed in the accounting policies disclosed in the company's consolidated financial statements for the year ended December 31, 2011. Those accounting policies have been applied consistently to all periods presented in these financial statements.

(c) Functional Currency and Presentation Currency

These consolidated financial statements are presented in Canadian dollars, which is the company's functional currency.

(d) Use of Estimates and Judgment

The timely preparation of financial statements requires that management make estimates and assumptions and use judgment. Accordingly, actual results may differ from estimated amounts as future confirming events occur. Significant estimates and judgment used in the preparation of the financial statements are described in the company's consolidated financial statements for the year ended December 31, 2011.

3. SEGMENTED INFORMATION

The company's operating segments are determined based on differences in the nature of their operations, products and services.

Intersegment sales of crude oil and natural gas are accounted for at market values and included, for segmented reporting, in revenues of the segment making the transfer and expenses of the segment receiving the transfer. Intersegment amounts are eliminated on consolidation.

Suncor Energy Inc.
2012 First Quarter 047


	Three months ended March 31
	Oil Sands ⁽¹⁾				Exploration and Production				Refining and Marketing				Corporate, Energy Trading and Eliminations				Total
($ millions)	2012		2011		2012		2011		2012		2011		2012		2011		2012		2011

Revenues and Other Income
Gross revenues	2 335		2 045		1 690		1 606		6 363		5 838		23		9		10 411		9 498
Intersegment revenues	882		846		272		209		37		1		(1 191	)	(1 056	)	—		—
Less: Royalties	(280	)	(123	)	(478	)	(432	)	—		—		—		—		(758	)	(555	)

Operating revenues, net of royalties	2 937		2 768		1 484		1 383		6 400		5 839		(1 168	)	(1 047	)	9 653		8 943
Other income	3		1		41		3		(2	)	37		63		91		105		132

	2 940		2 769		1 525		1 386		6 398		5 876		(1 105	)	(956	)	9 758		9 075

Expenses
Purchases of crude oil and products	48		51		132		120		5 012		4 295		(1 196	)	(977	)	3 996		3 489
Operating, selling and general	1 517		1 320		193		236		569		575		175		160		2 454		2 291
Transportation	72		85		30		32		48		59		6		(9	)	156		167
Depreciation, depletion, amortization and impairment	440		311		360		354		111		102		36		18		947		785
Exploration	40		40		5		18		—		—		—		—		45		58
Loss (gain) on disposal of assets	(29	)	112		—		146		(2	)	(6	)	—		(1	)	(31	)	251
Project start-up costs	1		37		—		—		—		—		—		—		1		37
Financing expenses (income)	29		18		43		25		(1	)	6		(153	)	(98	)	(82	)	(49	)

	2 118		1 974		763		931		5 737		5 031		(1 132	)	(907	)	7 486		7 029

Earnings (Loss) before Income Taxes	822		795		762		455		661		845		27		(49	)	2 272		2 046
Income taxes
Current	2		—		437		388		37		15		21		13		497		416
Deferred	213		190		(7	)	253		150		203		(38	)	(44	)	318		602

	215		190		430		641		187		218		(17	)	(31	)	815		1 018

Net Earnings (Loss)	607		605		332		(186	)	474		627		44		(18	)	1 457		1 028

Capital and Exploration Expenditures	1 177		1 180		206		228		89		106		6		62		1 478		1 576

(1): During the first quarter of 2012, the company completed a review of the presentation of purchase and sale transactions in its Oil Sands segment. It was determined that certain transactions previously recorded on a gross basis are more appropriately reflected through net presentation.

Prior period comparative figures have been reclassified for comparability with the current period presentation. The impact is as follows:


	Three months ended
($ millions, increase/(decrease))	March 31, 2011

Gross revenues	(313	)
Purchases of crude oil and products	(313	)

Net earnings	—

Suncor Energy Inc.
048 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

4. OTHER INCOME

Other Income consists of the following:


		Three months ended March 31
($ millions)		2012		2011

Risk management activities		(7	)	(18	)
Energy trading activities
	Change in fair value of contracts	100		23
	Unrealized gains (losses) on inventory valuation	(19	)	41
Investment and interest income		18		72
Renewable energy grants		9		12
Other		4		2

		105		132

5. SHARE-BASED COMPENSATION

The following table summarizes the share-based compensation expense recorded for all plans within Operating, Selling and General expense.


	Three months ended March 31
($ millions)	2012	2011

Equity-settled plans	40	43
Cash-settled plans	112	228

	152	271

6. NORMAL COURSE ISSUER BID

In February 2012, the company recommenced its Normal Course Issuer Bid (NCIB), and may purchase for cancellation an additional $1 billion of its common shares between February 28, 2012 and September 5, 2012.

During the quarter, the company purchased 5.5 million common shares for total consideration of $183 million. Of the amount paid, $71 million was charged to share capital and $112 million to retained earnings.

At March 31, 2012, the company recorded a liability of $110 million for share purchases that may take place during its internal trading blackout period under an automatic share purchase agreement with an independent broker. Of the liability recognized, $44 million was charged to share capital and $66 million to retained earnings.

During the third and fourth quarters of 2011, the company completed the purchase of 17.1 million shares for total consideration of $500 million under the NCIB announced in August 2011. Of the amount paid, $222 million was charged to share capital and $278 million to retained earnings.

Suncor Energy Inc.
2012 First Quarter 049

7. FINANCING EXPENSES (INCOME)


		Three months ended March 31
($ millions)		2012		2011

Interest on debt		162		161
Capitalized interest		(158	)	(100	)

	Interest expense	4		61
	Accretion	46		38
	Foreign exchange gain on U.S. dollar denominated long-term debt	(146	)	(186	)
	Foreign exchange and other	14		38

		(82	)	(49	)

8. INCOME TAXES

In the first quarter of 2011, the U.K. government substantively enacted a 12% increase in the supplementary charge on U.K. oil and gas profits. Accordingly, the company recognized an increase in deferred tax expense of $442 million related to the revaluation of deferred income tax balances.

9. EARNINGS PER COMMON SHARE


		Three months ended March 31
($ millions)		2012	2011

Net earnings		1 457	1 028

(millions of common shares)
Weighted-average number of common shares		1 561	1 570
Dilutive securities:
	Effect of share options	6	11

Weighted-average number of diluted common shares		1 567	1 581

(dollars per common share)
Basic earnings per share		0.93	0.65
Diluted earnings per share		0.93	0.65

Suncor Energy Inc.
050 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

Exhibit 4.6

MANAGEMENT'S DISCUSSION AND ANALYSIS
April 30, 2012

This Management's Discussion and Analysis (MD&A) should be read in conjunction with Suncor's unaudited interim Consolidated Financial Statements for the three months ended March 31, 2012, Suncor's audited Consolidated Financial Statements for the year ended December 31, 2011 and Suncor's MD&A for the year ended December 31, 2011 (the 2011 annual MD&A).

Additional information about Suncor filed with Canadian securities regulatory authorities and the United States Securities and Exchange Commission (SEC), including quarterly and annual reports and Suncor's Annual Information Form dated March 1, 2012 (the 2011 AIF), which is also filed with the SEC under cover of Form 40-F, is available online at www.sedar.com, www.sec.gov and our website www.suncor.com. Information contained in or otherwise accessible through our website does not form part of this MD&A, and is not incorporated into this MD&A by reference.

References to "we", "our", "Suncor", or "the company" mean Suncor Energy Inc., and the company's subsidiaries and interests in associates and jointly controlled entities, unless the context otherwise requires.

Table of Contents


1.	Advisories	6
2.	First Quarter Highlights	8
3.	Suncor Overview	9
4.	Consolidated Financial Information	11
5.	Segment Results and Analysis	16
6.	Capital Investment Update	29
7.	Financial Condition and Liquidity	31
8.	Quarterly Financial Data	34
9.	Other Items	36
10.	Non-GAAP Financial Measures Advisory	37
11.	Advisory – Forward-Looking Information	40

1. ADVISORIES

Basis of Presentation

Unless otherwise noted, all financial information has been prepared in accordance with Canadian generally accepted accounting principles (GAAP), specifically International Accounting Standard (IAS) 34 – Interim Financial Reporting as issued by the International Accounting Standards Board, which is within Part 1 of the Canadian Institute of Chartered Accountants Handbook, which itself is within the framework of International Financial Reporting Standards (IFRS).

All financial information is reported in Canadian dollars, unless otherwise noted. Production volumes are presented on a working-interest basis, before royalties, unless otherwise noted. Certain prior year amounts in the Consolidated Statements of Comprehensive Income have been reclassified to conform to the current year's presentation.

Non-GAAP Financial Measures

Certain financial measures in this MD&A – namely operating earnings, cash flow from operations, return on capital employed (ROCE) and Oil Sands cash operating costs – are not prescribed by GAAP. Operating earnings and Oil Sands cash operating costs are defined in the Non-GAAP Financial Measures Advisory section of this MD&A and reconciled to GAAP

Suncor Energy Inc.
006 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

measures in the Segment Results and Analysis section of this MD&A. Cash flow from operations and ROCE are defined and reconciled to GAAP measures in the Non-GAAP Financial Measures Advisory section of this MD&A.

These non-GAAP financial measures do not have any standardized meaning and therefore are unlikely to be comparable to similar measures presented by other companies. These non-GAAP financial measures are included because management uses the information to analyze operating performance, leverage and liquidity, and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.

Common Abbreviations

The following is a list of abbreviations that may be used in this MD&A:


Measurement
bbl		barrel
bbls/d		barrels per day
mbbls/d		thousands of barrels per day
boe		barrels of oil equivalent
boe/d		barrels of oil equivalent per day
mboe		thousands of barrels of oil equivalent
mboe/d		thousands of barrels of oil equivalent per day
mcf		thousands of cubic feet of natural gas
mcfe		thousands of cubic feet of natural gas equivalent
mmcf		millions of cubic feet of natural gas
mmcf/d		millions of cubic feet of natural gas per day
mmcfe		millions of cubic feet of natural gas equivalent
mmcfe/d		millions of cubic feet of natural gas equivalent per day
m ³		cubic metres
m ³ /d		cubic metres per day
MW		megawatts
Places and Currencies
U.S.		United States
U.K.		United Kingdom
B.C.		British Columbia
$ or Cdn$		Canadian dollars
US$		United States dollars
£		Pounds sterling
€		Euros
Financial and Business Environment
Q1		Three months ended March 31
DD&A		Depreciation, depletion and amortization
WTI		West Texas Intermediate
WCS		Western Canada Select
SCO		Synthetic crude oil
NYMEX		New York Mercantile Exchange

Risk Factors and Forward-Looking Information

The company's financial and operational performance is potentially affected by a number of factors, including, but not limited to, the volatility of commodity prices and exchange rate fluctuations; government regulation, including changes to royalty and income tax legislation; environmental regulation, including changes to climate change and reclamation legislation; risks associated with operating in foreign countries, including geopolitical and other political risks; operating hazards and other uncertainties, including extreme weather conditions, fires, explosions and oil spills; risks associated with the execution of major projects; reputational risk; permit approval; labour and materials supply; and other issues described within the Advisory – Forward-Looking Information section of this MD&A. A more detailed discussion of the risk factors affecting the company is presented in the Risk Factors section of Suncor's 2011 annual MD&A, which section is herein incorporated by reference.

This MD&A contains forward-looking information based on Suncor's current expectations, estimates, projections and assumptions. This information is subject to a number of risks and uncertainties, including those discussed in this MD&A

Suncor Energy Inc.
2012 First Quarter 007

and Suncor's other disclosure documents, many of which are beyond the company's control. Users of this information are cautioned that actual results may differ materially. Refer to the Advisory – Forward-Looking Information section of this MD&A for information on the material risk factors and assumptions underlying our forward-looking information.

Measurement Conversions

Certain crude oil and natural gas liquids volumes have been converted to mcfe or mmcfe on the basis of one bbl to six mcf. Also, certain natural gas volumes have been converted to boe or mboe on the same basis. Any figure presented in mcfe, mmcfe, boe or mboe may be misleading, particularly if used in isolation. A conversion ratio of one bbl of crude oil or natural gas liquids to six mcf of natural gas is based on an energy equivalency conversion method primarily applicable at the burner tip and does not necessarily represent value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, conversion on a 6:1 basis may be misleading as an indication of value.

2. FIRST QUARTER HIGHLIGHTS

•

First quarter financial results.

•: Consolidated net earnings for the first quarter of 2012 were $1.457 billion, compared to $1.028 billion for the first quarter of 2011.
•: Operating earnings ⁽¹⁾ for the first quarter of 2012 were $1.329 billion, compared to $1.478 billion for the first quarter of 2011. Operating earnings were lower due primarily to lower upstream production volumes, higher royalties and higher depreciation in the Oil Sands segment, partially offset by higher upstream price realizations.
•: Cash flow from operations ⁽¹⁾ was $2.426 billion for the first quarter of 2012, compared to $2.393 billion for the first quarter of 2011.
•: ROCE ⁽¹⁾ (excluding major projects in progress) for the twelve months ended March 31, 2012 improved to 14.8%, compared to 12.5% for the twelve months ended March 31, 2011.
•: Net debt at March 31, 2012 was $5.966 billion, compared to $6.976 billion at December 31, 2011.

•

Steve Williams to become chief executive officer. As announced on December 1, 2011, Rick George, the company's current Chief Executive Officer (CEO) is retiring effective May 1, 2012. Suncor's President and Chief Operating Officer, Steve Williams, will succeed him as CEO. Mr. Williams joined Suncor in 2002 as Executive Vice President, Corporate Development and Chief Financial Officer. He served as Executive Vice President, Oil Sands for four years where he was responsible for leading Suncor's oil sands operations through a significant period of growth.

•

Ramp up of production from Firebag Stage 3 expansion proceeding in line with expectations. Bitumen production from the company's Firebag operations averaged 83,600 bbls/d and exited the first quarter of 2012 at approximately 96,000 bbls/d, a 20% increase from the rate exiting the fourth quarter of 2011. Firebag bitumen production also increased due to infill wells completed in 2011 and optimization of steam generation from Stage 3 facilities across the integrated Firebag complex.

•

Increased Oil Sands production prior to Upgrader 2 outage. Oil Sands (excluding Syncrude) achieved consecutive monthly record production levels in January and February, prior to an operational issue in March with a fractionator at the Upgrader 2 facilities, which were taken offline for approximately five weeks for maintenance and restarted successfully in April.

(1)

Operating earnings, cash flow from operations and ROCE are non-GAAP financial measures. See the Non-GAAP Financial Measures Advisory section of this MD&A.

Suncor Energy Inc.
008 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

•: Power of Suncor's integrated business model. Canadian-based crude oil production, including Suncor's sweet and sour synthetic crude oil, traded at significant discounts to WTI during the first quarter of 2012. Suncor's integration with inland refineries in the Refining and Marketing segment is recovering much of this decline in crude price realization through lower feedstock costs. In addition, decreasing North American natural gas prices reduced cash flow from North America Onshore assets; however, this impact was more than offset by lower operating costs for steam and power generation at Suncor's oil sands and refining facilities.
•: Suncor continues its share repurchase program. In February, Suncor announced a plan to repurchase up to $1 billion of its common shares, continuing the program to return value to shareholders that saw the company repurchase $500 million of its common shares in 2011. The company repurchased approximately 5.5 million common shares, returning $183 million to shareholders during the first quarter of 2012. As at April 27, 2012, the company had repurchased approximately 4.3 million additional common shares, returning an additional $134 million to shareholders.
•: Dividend increase approved. Suncor's Board of Directors approved an 18% increase to the company's quarterly dividend to $0.13 per common share, from the previous level of $0.11 per common share, beginning in the second quarter of 2012. The five-year compound annual growth rate of Suncor's dividends is 21%.

3. SUNCOR OVERVIEW

Suncor Energy Inc. is an integrated energy company headquartered in Calgary, Alberta. The company has classified its operations into the following segments:

OIL SANDS

Suncor's Oil Sands segment, with assets located in northeast Alberta, recovers bitumen from mining and in situ operations and upgrades the majority of this production into refinery feedstock, diesel fuel and byproducts. The Oil Sands segment includes:

•

Oil Sands operations refer to Suncor's wholly owned and operated mining, extraction, upgrading and in situ assets in the Athabasca oil sands region. Oil Sands operations consist of:

•: Oil Sands Base operations include the Millennium and North Steepbank mining and extraction operations, two integrated upgrading facilities known as Upgrader 1 and Upgrader 2, and the associated infrastructure for these assets – including utilities, energy and reclamation facilities, such as Tailings Reduction Operations (TRO _TM ) assets.
•: In Situ operations include oil sands bitumen production from Firebag and MacKay River and supporting infrastructure, such as central processing facilities and cogeneration units. The majority of In Situ production is upgraded by Oil Sands Base; however, the company's marketing plan includes sales of bitumen when marketing conditions are favourable or as operating conditions at Oil Sands Base require.

•

Oil Sands Ventures assets include the company's interests in significant growth projects, including two where Suncor is the operator – the Fort Hills mining (40.8%) and the Voyageur upgrader (51%) projects, and one where Total E&P Canada Ltd. (Total E&P) is the operator – the Joslyn North mining project (36.75%). Oil Sands Ventures also includes the company's 12% interest in the Syncrude oil sands mining and upgrading joint venture.

EXPLORATION AND PRODUCTION

Suncor's Exploration and Production segment consists of offshore operations off the east coast of Canada and in the North Sea, and onshore operations in North America, Libya and Syria.

•: East Coast Canada operations include Suncor's 37.675% working interest in Terra Nova, for which Suncor is the operator. Suncor also holds a 20% interest in the Hibernia base project and a 19.5% interest in the Hibernia Southern Extension Unit (HSEU), a 27.5% interest in the White Rose base project and a 26.125% interest in the White Rose Extensions, and a 22.729% interest in Hebron, all of which are operated by other companies.

Suncor Energy Inc.
2012 First Quarter 009

•

International operations include Suncor's 29.89% working interest in Buzzard and a 26.69% interest in the Golden Eagle Area Development (Golden Eagle) in the U.K. portion of the North Sea, both of which are operated by another company. Suncor also holds interests in several North Sea licences offshore the U.K. and Norway. Suncor owns, pursuant to a Production Sharing Contract (PSC), an interest in the Ebla gas development in the Ash Shaer and Cherrife areas in Syria. Suncor also owns, pursuant to Exploration and Production Sharing Agreements (EPSAs), working interests in the exploration and development of oilfields in the Sirte Basin in Libya.

Suncor is currently engaged in discussions with the National Oil Corporation with respect to the impact of the force majeure period on the company's contractual obligations for its production and development activities in Libya. Suncor remains in force majeure for all exploration activities.

Due to recent unrest and sanctions in Syria, the company has declared force majeure under its contractual obligations, and operations in Syria have been suspended indefinitely.

•

North America Onshore operations include Suncor's interests in a number of assets in Western Canada, which primarily produce natural gas.

REFINING AND MARKETING

Suncor's Refining and Marketing segment consists of two primary operations:

•: Refining and Product Supply operations refine crude oil into a broad range of petroleum and petrochemical products. Eastern North America operations include refineries located in Montreal, Quebec and Sarnia, Ontario, and a lubricants business located in Mississauga, Ontario that manufactures, blends and markets products worldwide. Western North America operations include refineries located in Edmonton, Alberta and Commerce City, Colorado. Other Refining and Product Supply assets include interests in a petrochemical plant, pipelines and product terminals in Canada and the U.S.
•: Downstream Marketing operations sell refined petroleum products and lubricants to retail, commercial and industrial customers through a combination of company-owned, branded-dealer and other retail stations in Canada and Colorado, a nationwide commercial road transport network in Canada, and a bulk sales channel in Canada.

CORPORATE, ENERGY TRADING AND ELIMINATIONS

The grouping Corporate, Energy Trading and Eliminations includes the company's investments in renewable energy projects, results related to energy supply and trading activities, and other activities not directly attributable to any other operating segment.

•: Renewable Energy interests include six operating wind power projects and the St. Clair ethanol plant in Ontario.
•: Energy Trading activities primarily involve the marketing, supply and trading of crude oil, natural gas, refined petroleum products and byproducts, and the use of midstream infrastructure and financial derivatives to optimize related trading strategies.
•: Corporate activities include stewardship of Suncor's debt and borrowing costs, expenses not allocated to the company's businesses, and the company's captive insurance activities that self-insure a portion of the company's asset base.
•: Intersegment revenues and expenses are removed from consolidated results in Group Eliminations . Intersegment activity includes the sale of feedstock by the Oil Sands and Exploration and Production segments to the Refining and Marketing segment, the sale of fuels and lubricants by the Refining and Marketing segment to the Oil Sands segment, the sale of ethanol by the Renewable Energy business to the Refining and Marketing segment, and the provision of insurance for a portion of the company's operations by the Corporate captive insurance entity.

Suncor Energy Inc.
010 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

4. CONSOLIDATED FINANCIAL INFORMATION

Financial Highlights


		Three months ended March 31
($ millions)		2012		2011

Net earnings (loss)
	Oil Sands	607		605
	Exploration and Production	332		(186	)
	Refining and Marketing	474		627
	Corporate, Energy Trading and Eliminations	44		(18	)

Total		1 457		1 028

Operating earnings (loss) ⁽¹⁾
	Oil Sands	607		694
	Exploration and Production	332		337
	Refining and Marketing	474		627
	Corporate, Energy Trading and Eliminations	(84	)	(180	)

Total		1 329		1 478

Cash flow from (used in) operations ⁽¹⁾
	Oil Sands	1 118		1 137
	Exploration and Production	677		583
	Refining and Marketing	741		929
	Corporate, Energy Trading and Eliminations	(110	)	(256	)

Total		2 426		2 393

Operating Highlights


		Three months ended March 31
		2012	2011

Production volumes by segment
	Oil Sands (mbbls/d)	341.1	360.6
	Exploration and Production (mboe/d)	221.2	240.7

Total		562.3	601.3

Production mix
	Crude oil and liquids / natural gas (%)	90/10	87/13

Average price realizations by segment
	Oil Sands ($/bbl)	91.71	83.72
	Exploration and Production ($/mboe)	90.48	77.13

(1): Non-GAAP financial measures. Operating earnings are reconciled to net earnings below. See the Non-GAAP Financial Measures Advisory section of this MD&A.

Suncor Energy Inc.
2012 First Quarter 011

Net Earnings

Suncor's net earnings for the first quarter of 2012 were $1.457 billion, compared to $1.028 billion in the first quarter of 2011. Net earnings were primarily affected by the same factors that influenced operating earnings described subsequently in this section of the MD&A. Other items affecting changes in net earnings over the first quarter of 2012, compared with the first quarter of 2011, included:

•: The after-tax unrealized foreign exchange gain on the revaluation of U.S. dollar denominated long-term debt was $128 million in the first quarter of 2012, compared to $162 million in the first quarter of 2011.
•: During the first quarter of 2011, the company disposed of assets resulting in after-tax losses of $170 million, consisting of $89 million for the partial disposition of working interests in the Voyageur upgrader and Fort Hills mining projects, and $81 million for the sale of non-core Exploration and Production assets.
•: In the first quarter of 2011, the U.K. government announced an increase in the tax rate on oil and gas profits in the North Sea that increased the statutory tax rate on Suncor's earnings in the U.K. from 50% to 59.3% in 2011 and 62% in future years. As a result, the company revalued its deferred income tax balances, resulting in an increase to deferred income tax expense of $442 million.

Operating Earnings

Suncor's consolidated operating earnings for the first quarter of 2012 were $1.329 billion, compared to $1.478 billion in the first quarter of 2011.

Consolidated Operating Earnings Reconciliation ⁽¹⁾


	Three months ended March 31
($ millions)	2012		2011

Net earnings as reported	1 457		1 028
Unrealized foreign exchange gain on U.S. dollar denominated long-term debt	(128	)	(162	)
Loss on significant disposals	—		170
Impact of income tax rate adjustments on deferred income taxes	—		442

Operating earnings	1 329		1 478

(1): Operating earnings is a non-GAAP financial measure. All reconciling items are presented on an after-tax basis. See the Non-GAAP Financial Measures Advisory section of this MD&A.

Suncor Energy Inc.
012 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

(1): Factors represent after-tax variances and include the impacts of operating earnings adjustments. These factors are analyzed in the narrative immediately subsequent to this bridge analysis. This bridge analysis is provided because management uses this presentation to analyze performance.
(2): Calculated based on production volumes for the Oil Sands and Exploration and Production segments and sales volumes for the Refining and Marketing segment.
(3): Includes upstream price realizations before royalties, refining and marketing margins, other operating revenues, and the net impacts of sales and purchases of third-party crude.
(4): The Inventory variance factor reflects the opportunity cost of building production volumes in inventory or the additional margin earned by drawing down inventory produced in previous periods. The calculation of the Inventory variance factor in this bridge analysis permits the company to present the Volume variance factor for upstream assets based on production volumes, rather than based on sales volumes.
(5): The Operating Expense factor includes transportation expense, operating, selling and general expense and project start-up costs.
(6): This factor also includes changes in gains and losses on disposal of assets that are not operating earnings adjustments, changes in effective income tax rates, and other income tax adjustments.

Positive factors impacting operating earnings in the first quarter of 2012, compared to the same period in 2011, included:

•: Average price realizations for crude oil were higher in the first quarter of 2012, due mainly to increases in the benchmark prices for WTI and Brent crudes, partially offset by price discounts for Canadian-based crude oil production. Average price realizations increased 10% for Oil Sands segment sales and 17% for Exploration and Production segment sales.
•: Operating expenses were lower, due primarily to lower share-based compensation expense that reflected a smaller increase in the company's common share price over the first quarter of 2012, compared with the first quarter of 2011. The impact on the company's operating segments of the $124 million after-tax share-based compensation expense in the first quarter of 2012 was $64 million for Corporate, Energy Trading and Eliminations; $36 million for Oil Sands; $18 million for Refining and Marketing; and $6 million for Exploration and Production. The first quarter of 2011 included a $212 million after-tax expense for share- based compensation.
•: Financing expense was lower in the first quarter of 2012, as the company capitalized a higher percentage of its borrowing costs as part of the cost of major development assets and construction projects, resulting in lower interest expense.

The positive factors noted above were more than offset by the following:

•: Production volumes for the Oil Sands segment decreased to 341,100 bbls/d from 360,600 bbls/d, due primarily to an unplanned outage at the company's Upgrader 2 facilities.

Suncor Energy Inc.
2012 First Quarter 013

•: Production volumes for the Exploration and Production segment decreased to 221,200 boe/d from 240,700 boe/d, primarily due to the divestiture of non-core assets throughout 2011, and the company declaring force majeure under its contractual obligations and suspending its operations in Syria in December 2011.
•: In the first quarter of 2011, the uplift to operating earnings with respect to the impact of a rising crude price environment on refining margins was significantly higher than the uplift in the first quarter of 2012. In a rising crude price environment, inventories produced during periods of lower feedstock costs are sold and replaced with inventories purchased at relatively higher feedstock costs.
•: Royalties were higher in the first quarter of 2012, due mainly to higher benchmark prices and the prior year quarter including higher allowable costs for Oil Sands Base capital projects.
•: DD&A was higher in the first quarter of 2012, due mainly to recently commissioned assets for Oil Sands operations, including the Firebag Stage 3 expansion, and charges related to modifications of the Millennium Naphtha Unit (MNU) hydrogen plant during the commissioning period.

Cash Flow from Operations

Consolidated cash flow from operations for the first quarter of 2012 was $2.426 billion, compared to $2.393 billion in the first quarter of 2011. The increase was mainly a result of higher upstream price realizations, partially offset by lower upstream production volumes and higher royalties.

Business Environment

Commodity prices, refining crack spreads and foreign exchange rates are some of the most significant factors that affect the results of Suncor's operations.


		Average for three months ended March 31
		2012	2011

WTI crude oil at Cushing	US$/bbl	102.95	94.10
Dated Brent crude oil at Sullom Voe	US$/bbl	118.35	104.95
Dated Brent/Maya crude oil FOB price differential	US$/bbl	9.45	15.65
Canadian 0.3% par crude oil at Edmonton	Cdn$/bbl	92.80	88.40
Light/heavy crude oil differential for WTI at Cushing less WCS at Hardisty	US$/bbl	21.45	22.85
Condensate at Edmonton	US$/bbl	110.00	98.35
Natural gas (Alberta spot) at AECO	Cdn$/mcf	2.50	3.80
New York Harbor 3-2-1 crack ⁽¹⁾	US$/bbl	25.80	19.40
Chicago 3-2-1 crack ⁽¹⁾	US$/bbl	18.80	16.45
Portland 3-2-1 crack ⁽¹⁾	US$/bbl	27.70	21.40
Gulf Coast 3-2-1 crack ⁽¹⁾	US$/bbl	25.45	18.50
Exchange rate	US$/Cdn$	1.00	1.01
Exchange rate (end of period)	US$/Cdn$	1.00	1.03

(1): 3-2-1 crack spreads are indicators of the refining margin generated by converting three barrels of WTI into two barrels of gasoline and one barrel of diesel. The crack spreads presented here generally approximate the regions into which the company sells refined products through retail and wholesale channels.

Suncor Energy Inc.
014 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

Suncor's sweet SCO price realizations are influenced primarily by changes in the price for WTI at Cushing. The average WTI price for the first quarter of 2012 increased to US$102.95/bbl, compared to US$94.10/bbl in the first quarter of 2011. Suncor's price realizations for SCO are also influenced by the supply and demand of sweet SCO from Western Canada.

Suncor produces a specific grade of sour SCO, the price realizations for which are influenced by changes to various crude benchmarks including, but not limited to, Canadian par crude at Edmonton and WCS at Hardisty, but which can also be affected by circumstances underlying spot sales required to manage inventory levels. Prices for Canadian par crude at Edmonton in the first quarter of 2012 also increased, averaging $92.80/bbl, compared to $88.40/bbl in the first quarter of 2011.

Bitumen production that Suncor does not upgrade is blended with diluent to facilitate delivery on pipeline systems to customers. Net bitumen price realizations are, therefore, influenced by both prices for Canadian heavy crude oil (WCS at Hardisty is a common reference) and prices for diluent (Condensate at Edmonton). Diluent is sourced primarily from the company's own upgrading and refining facilities; however, purchases of diluent from third parties may be required when the company experiences operational outages. Bitumen price realizations can also be affected by bitumen quality and spot sales to manage inventory levels. In the first quarter of 2012, average price realizations for bitumen relative to WTI were consistent with those realized in the first quarter of 2011, with increases in prices for WTI largely offset by increases in the price for diluent.

Price realizations for Suncor's crude sales basket relative to common benchmark crudes are also influenced by the demands of our refinery customers and distribution constraints on pipeline systems. Compared to the fourth quarter of 2011, in the first quarter of 2012, prices for WTI increased, but prices for Canadian par crude at Edmonton decreased, sweet SCO traded at a discount to WTI, and the light/heavy differential for Canadian-based crudes doubled. As a result, the overall average price realization for Suncor's Oil Sands production (excluding Syncrude) was WTI less Cdn$12.12/bbl, compared to WTI plus Cdn$1.10/bbl in the fourth quarter of 2011. Suncor's integration with inland refineries in the Refining and Marketing segment is recovering much of this decline in crude price realization through lower feedstock costs.

Suncor's price realizations for production from East Coast Canada and International assets are influenced primarily by the price for Brent crude. The average price for Brent crude in the first quarter of 2012 increased to US$118.35/bbl from US$104.95/bbl in the first quarter of 2011. The average premium for Brent crude compared to WTI increased to US$15.40/bbl from $10.85/bbl.

Suncor's price realizations for North America Onshore natural gas production are primarily referenced to Alberta spot at AECO. The average AECO benchmark decreased to $2.50/mcf in the first quarter of 2012, from $3.80/mcf in the first quarter of 2011.

Suncor's refining margins are influenced primarily by 3-2-1 crack spreads, which are industry indicators approximating the gross margin on a barrel of crude oil that is refined to produce gasoline and distillates, and by light/heavy and light/sour crude differentials, which indicate when more complex refineries can earn greater margins by processing less expensive, heavier crudes. Crack spreads do not necessarily reflect the margins of a specific refinery because these benchmarks are calculated based off of WTI. Specific refinery margins are further impacted by actual crude purchase costs, refinery configuration and refined product sales markets unique to that refinery's supply orbit. In the first quarter of 2012, crack spreads were higher than those from the first quarter of 2011 in the major markets into which Suncor sells finished product. Prices for refined products reflected the higher priced Brent crude feedstock of coastal North American markets, which continues to positively benefit Suncor's inland refineries (Sarnia, Edmonton and Commerce City).

The majority of Suncor's revenues from the sale of oil and natural gas commodities are based on prices that are determined by, or referenced to, U.S. dollar benchmark prices. The majority of Suncor's expenditures are realized in Canadian dollars. An increase in the value of the Canadian dollar relative to the U.S. dollar will decrease revenue received from the sale of commodities. A decrease in the value of the Canadian dollar relative to the U.S. dollar will increase the revenues received from the sale of commodities.

Suncor Energy Inc.
2012 First Quarter 015

Conversely, many of Suncor's assets and liabilities, notably most of the company's long-term debt, are denominated in U.S. dollars and translated to Suncor's reporting currency (Canadian dollars) at each balance sheet date. An increase in the value of the Canadian dollar relative to the U.S. dollar from the previous balance sheet date decreases the Canadian dollars required to settle U.S. dollar denominated obligations.

5. SEGMENT RESULTS AND ANALYSIS

OIL SANDS

Financial Highlights


		Three months ended March 31
($ millions)		2012		2011

Gross revenues		3 217		2 891
Less: Royalties		(280	)	(123	)

Operating revenues, net of royalties		2 937		2 768

Net earnings		607		605

Operating earnings ⁽¹⁾
	Oil Sands	538		622
	Oil Sands Ventures	69		72

		607		694

Cash flow from operations ⁽¹⁾		1 118		1 137

(1): Non-GAAP financial measures. Operating earnings are reconciled to net earnings below. See the Non-GAAP Financial Measures Advisory section of this MD&A.

Oil Sands segment net and operating earnings for the first quarter of 2012 were $607 million, compared to $605 million of net earnings and $694 million of operating earnings for the first quarter of 2011. In the first quarter of 2011, the company recorded an after-tax loss of $89 million on the partial disposition of working interests in the Voyageur upgrader and Fort Hills mining projects.

Oil Sands operations contributed $538 million of operating earnings, while Oil Sands Ventures contributed $69 million. The decrease in operating earnings for Oil Sands operations, compared to the first quarter of 2011, was due mainly to higher royalties and DD&A, and lower production associated with an unplanned Upgrader 2 outage, partially offset by higher average price realizations.

Cash flow from operations for the Oil Sands segment in the first quarter of 2012 was $1.118 billion, compared to $1.137 billion in the first quarter of 2011, and decreased mainly due to higher royalties and lower production volumes, partially offset by higher price realizations.

Operating Earnings

Operating Earnings Reconciliation


	Three months ended March 31
($ millions)	2012	2011

Net earnings as reported	607	605
Loss on significant disposals	—	89

Operating earnings ⁽¹⁾	607	694

(1): Non-GAAP financial measure. See the Non-GAAP Financial Measures Advisory section of this MD&A.

Suncor Energy Inc.
016 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

(1): Factors represent after-tax variances and include the impacts of operating earnings adjustments. These factors are analyzed in the narrative immediately subsequent to this bridge analysis. This bridge analysis is provided because management uses this presentation to analyze performance.
(2): Includes price realizations before royalties, other operating revenues and the net impacts of sales and purchases of third-party crude.
(3): The Inventory variance factor reflects the opportunity cost of building production volumes in inventory or the additional margin earned by drawing down inventory produced in previous periods. The calculation of the Inventory variance factor in this bridge analysis permits the company to present the Production Volume variance factor based on production volumes, rather than based on sales volumes.
(4): The Operating Expense factor includes transportation expense, operating, selling and general expense and project start-up costs.
(5): This factor also includes changes in gains and losses on disposal of assets that are not operating earnings adjustments, changes in effective income tax rates, and other income tax adjustments.

Production Volumes ⁽¹⁾


	Three months ended March 31
(mbbls/d)	2012	2011

Upgraded product (sweet SCO, sour SCO and diesel)	273.1	297.0
Non-upgraded bitumen	32.6	25.1

Oil Sands	305.7	322.1
Oil Sands Ventures – Syncrude	35.4	38.5

Total	341.1	360.6

(1): Bitumen production from Oil Sands Base operations is upgraded, while bitumen production from In Situ operations is upgraded or sold directly to customers. Yields of SCO and diesel from Suncor's upgrading process are approximately 79% of bitumen feedstock input. See also the Bitumen Production table presented below.

Production volumes for Oil Sands operations averaged 305,700 bbls/d, compared to 322,100 bbls/d in the prior year quarter. Suncor achieved consecutive monthly production records in January and February, averaging 355,000 bbls/d and 361,000 bbls/d, respectively, reflecting strong reliability from mining and extraction operations and the ramp up of production from the Firebag Stage 3 expansion. In early March, as a result of an operational issue with a fractionator, the company took its Upgrader 2 facilities offline for unplanned maintenance. Upgrader 2 was successfully restarted in April. Production of upgraded product decreased compared to the prior year quarter, while production of non-upgraded bitumen increased compared to the prior year quarter, primarily as a result of the Upgrader 2 outage.

Suncor Energy Inc.
2012 First Quarter 017

Suncor's share of Syncrude production and sales decreased to 35,400 bbls/d from 38,500 bbls/d in the prior year quarter. The decrease in production was due mainly to operational issues with one of the coker units, which ran at reduced rates during the beginning of the quarter and was shut down in early March. The coker unit was returned to service in April.

Bitumen Production


		Three months ended March 31
		2012	2011

Oil Sands Base
	Bitumen production (mbbls/d)	262.5	318.0
	Bitumen ore mined (thousands of tonnes per day)	412.3	476.2
	Bitumen ore grade quality (bbls/tonne)	0.64	0.67

In Situ
	Bitumen production – Firebag (mbbls/d)	83.6	55.2
	Bitumen production – MacKay River (mbbls/d)	31.0	32.1

	Total In Situ bitumen production	114.6	87.3

	Steam-to-oil ratio – Firebag	3.7	3.1
	Steam-to-oil ratio – MacKay River	2.3	2.2

Oil Sands Base bitumen production from mining and extraction activities associated with the Steepbank (including North Steepbank) and Millennium mining areas averaged 262,500 bbls/d. Mining output was reduced for the duration of the Upgrader 2 outage. The company continues to mine through an area of lower bitumen ore grade quality at the Millennium mine face, which the company expects to encounter through to the start of the fourth quarter of 2012.

In Situ bitumen production volumes averaged 114,600 bbls/d, increasing from 87,300 bbls/d in the prior year quarter. Average production from Firebag increased to 83,600 bbls/d from 55,200 bbls/d in the prior year quarter. The ramp up of production from the Firebag Stage 3 expansion is proceeding in line with expectations. Bitumen production from Firebag has also increased due to infill wells completed in 2011 and optimization of steam generation from Stage 3 facilities across the integrated Firebag complex. Higher steam-to-oil ratios for Firebag reflect new wells coming on-stream and are also in line with expectations. The company anticipates that the Firebag steam-to-oil ratio will decrease in future periods as the ramp up of production from the Stage 3 expansion continues. Average production from MacKay River decreased slightly to 31,000 bbls/d from 32,100 bbls/d in the prior year quarter.

Sales Volumes and Mix


	Three months ended March 31
	2012	2011

Oil Sands sales volumes (mbbls/d)
Sweet – sweet SCO and diesel (mbbls/d)	122.3	119.5
Sour – sour SCO and bitumen (mbbls/d)	210.5	206.7

	332.8	326.2

Oil Sands sweet/sour sales mix (%)	37/63	37/63

Suncor Energy Inc.
018 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

Sales volumes for Oil Sands operations for the first quarter of 2012 reflected production levels from late 2011 and early 2012, averaging 332,800 bbls/d, with the impacts of the Upgrader 2 outage expected to affect sales volumes mostly in the second quarter of 2012.

The sweet/sour sales mix for Oil Sands operations was 37% sweet in the first quarter of both 2012 and 2011. The impacts of higher bitumen sales that were a result of the Upgrader 2 outage were largely offset by higher sales of sweet product that were a result of improved reliability in secondary upgrading facilities.

Price Realizations


Net of transportation costs, but before royalties		Three months ended March 31
($/bbl)		2012		2011

Oil Sands
	Sweet – sweet SCO and diesel	105.74		93.90
	Sour – sour SCO and bitumen	82.35		76.10
	Crude sales basket (all products)	90.95		82.59
	Crude sales basket, relative to WTI	(12.12	)	(10.19	)

Oil Sands Ventures
	Syncrude – sweet SCO	98.82		93.33
	Syncrude, relative to WTI	(4.25	)	0.55

Average price realizations for sales from Oil Sands operations increased to $90.95/bbl (WTI less $12.12/bbl) in the first quarter of 2012 from $82.59 (WTI less $10.19/bbl) in the first quarter of 2011, due mainly to higher benchmark prices for crude oil. Average prices for sweet product from Oil Sands operations benefited from higher prices for and production of diesel; however, prices for sweet SCO relative to WTI decreased significantly over the quarter, resulting in discounts for sweet SCO in the first quarter of 2012, compared with premiums that were realized throughout much of 2011.

Royalties

Royalties for the Oil Sands segment were higher in the first quarter of 2012 than in the same period in 2011. The increase was mainly due to the prior year quarter including higher allowable costs for capital projects, primarily the TRO _TM infrastructure project. Royalties also increased because of higher prices for WTI that influence the company's regulated bitumen valuation methodology, and higher In Situ bitumen production. These factors were partially offset by lower bitumen production from Oil Sands Base and Syncrude.

Inventory

Due to the outage at Upgrader 2 late in the first quarter of 2012, inventory levels decreased approximately 20%. The company expects that it will rebuild inventory levels over the second quarter of 2012. The impact of drawing down inventory produced in previous periods was mostly offset by a decrease in inventory costs per unit of production, whereby inventories produced in prior periods at relatively higher per unit costs were sold and replaced by inventories produced in the current period at relatively lower per unit costs.

Suncor Energy Inc.
2012 First Quarter 019

Cash Operating Costs Reconciliation ⁽¹⁾ ⁽²⁾

Cash operating costs per barrel for Oil Sands operations increased in the first quarter of 2012, averaging $38.10/bbl compared to $35.45/bbl in the first quarter of 2011, impacted by lower production (+$1.60/bbl) and higher total cash operating costs (+$1.05/bbl).

Cash operating costs for Oil Sands operations increased to $1.056 billion in the first quarter of 2012 from $1.028 billion in the first quarter of 2011. Total In Situ cash operating costs were higher, due mainly to larger operations associated with the Firebag Stage 3 expansion and well workovers at MacKay River. Cash operating costs for Oil Sands Base were consistent with the prior year quarter, as higher costs related to an increase in overburden removal activity were offset by lower energy costs, due primarily to lower natural gas prices, and lower upgrading costs, due mainly to higher maintenance costs for secondary upgrading facilities in the prior year quarter.


		Three months ended March 31
($ millions)		2012		2011

Operating, selling and general expense		1 517		1 320
	Syncrude operating, selling and general expense	(111	)	(133	)
	Non-production costs ⁽³⁾	(123	)	(124	)
	Other ⁽⁴⁾	(227	)	(35	)

Cash operating costs		1 056		1 028
Cash operating costs ($/bbl)		38.10		35.45

(1): Cash operating costs and cash operating costs per barrel are non-GAAP financial measures. See the Non-GAAP Financial Measures Advisory section of this MD&A.
(2): Effective with the first quarter of 2012, the calculation of cash operating costs has been revised to better reflect the ongoing cash costs of production, and prior period figures have been re-determined. See the Non-GAAP Financial Measures Advisory section of this MD&A.
(3): Significant non-production costs include, but are not limited to, share-based compensation adjustments, costs related to the remobilization or deferral of growth projects, research, the expense recorded as part of a non-monetary arrangement involving a third-party processor and feedstock costs for natural gas used to create hydrogen for secondary upgrading processes.
(4): Other includes the impacts of changes in inventory valuation and a reduction for operating revenues associated with excess power from cogeneration units.

Expenses and Other Factors

Operating expenses at Syncrude were lower in the first quarter of 2012 than in the first quarter of 2011, due primarily to lower compensation expense and lower prices for natural gas.

Other Oil Sands operating expenses were lower in the first quarter of 2012, primarily due to lower project start-up costs and lower share-based compensation expense. The first quarter of 2011 included project start-up costs primarily related to the Firebag Stage 3 expansion, which was substantially complete by the first quarter of 2012. Project start-up activity for the Firebag Stage 4 expansion is expected to increase in the second half of 2012. These decreases to other Oil Sands operating expenses were partially offset by higher costs related to the deferral and subsequent remobilization of certain growth projects after the economic downturn in late 2008 and early 2009 ("safe mode" costs). Pre-tax safe mode costs were $45 million in the first quarter of 2012, compared to $15 million in the first quarter of 2011, and increased due to activity pertaining to the Voyageur upgrader project. For 2012, the company anticipates that safe mode costs will largely consist of the costs to assess the condition of assets coming out of safe mode and the costs of remobilizing equipment and personnel.

DD&A expense for the first quarter of 2012 was higher than in the same period of 2011, due mainly to a larger asset base that is the result of recently commissioned assets pertaining to the Firebag Stage 3 expansion and costs capitalized as part of the major planned maintenance event in the second quarter of 2011. DD&A also increased due to charges related to the modifications of the MNU hydrogen plant during the commissioning period.

Suncor Energy Inc.
020 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

The factor presented in the bridge analysis of operating earnings for Financing Expense and Other Income was positive mainly due to a gain on the sale of a non-producing In Situ property in the first quarter of 2012, partially offset by higher accretion expense for decommissioning and restoration provisions.

Planned Maintenance Events

In the second quarter of 2012, the company expects to shut down one coker unit at Upgrader 1 for routine maintenance, which is not anticipated to significantly impact production. In the third quarter of 2012, the company expects to complete routine maintenance on the vacuum tower and secondary upgrading units, and shut down one coker unit at Upgrader 2. The impact of planned maintenance for the vacuum tower on overall production levels has been factored into Suncor's production forecasts. Planned maintenance for secondary upgrading units at Upgrader 1 is now expected to occur in 2013.

As part of its regular annual maintenance program, Syncrude has scheduled a two-month outage for one of its other coker units for the second quarter of 2012.

EXPLORATION AND PRODUCTION

Financial Highlights


		Three months ended March 31
($ millions)		2012		2011

Gross revenues		1 962		1 815
Less: Royalties		(478	)	(432	)

Operating revenues, net of royalties		1 484		1 383

Net earnings (loss)		332		(186	)

Operating earnings (loss) ⁽¹⁾
	East Coast Canada	164		136
	International	195		216
	North America Onshore	(27	)	(15	)

		332		337

Cash flow from operations ⁽¹⁾		677		583

(1): Non-GAAP financial measures. Operating earnings are reconciled to net earnings below. See also the Non-GAAP Financial Measures Advisory section of this MD&A.

Exploration and Production net earnings were $332 million in the first quarter of 2012, compared with a net loss of $186 million in the first quarter of 2011. The net loss in the first quarter of 2011 included a $442 million deferred income tax expense adjustment related to an increase in U.K. statutory income tax rates and an after-tax loss on the disposal of non-core assets of $81 million.

Exploration and Production operating earnings were $332 million in the first quarter of 2012, compared to $337 million in the first quarter of 2011. Operating earnings of $164 million for East Coast Canada were higher due mainly to higher average price realizations. Operating earnings of $195 million for International were lower, reflecting lower overall production volumes, partially offset by higher average price realizations. The operating loss of $27 million for North America Onshore was greater than in the prior year period, primarily due to lower average price realizations for natural gas sales, lower production volumes and costs associated with a fire that broke out on a drilling rig in B.C.

Suncor Energy Inc.
2012 First Quarter 021

Cash flow from operations was $677 million for the first quarter of 2012, compared to $583 million for the first quarter of 2011, and increased primarily due to higher overall average price realizations and the impact of current income tax on proceeds from the non-core asset dispositions in the prior year quarter.

Operating Earnings

Operating Earnings Reconciliation


	Three months ended March 31
($ millions)	2012	2011

Net earnings (loss) as reported	332	(186	)
Loss on significant disposals	—	81
Impact of income tax rate adjustments on deferred income taxes	—	442

Operating earnings ⁽¹⁾	332	337

(1): Non-GAAP financial measure. See the Non-GAAP Financial Measures Advisory section of this MD&A.

(1): Factors represent after-tax variances and include the impacts of operating earnings adjustments. These factors are analyzed in the narrative immediately subsequent to this bridge analysis. This bridge analysis is provided because management uses this presentation to analyze performance.
(2): Includes price realizations before royalties, other operating revenues, and the net impacts of sales and purchases of third-party crude.
(3): The Inventory variance factor reflects the opportunity cost of building production volumes in inventory or the additional margin earned by drawing down inventory produced in previous periods. The calculation of the Inventory variance factor in this bridge analysis permits the company to present the Production Volume variance factor based on production volumes, rather than based on sales volumes.
(4): The Operating Expense factor includes transportation expense and operating, selling and general expense.
(5): This factor also includes changes in gains and losses on disposal of assets that are not operating earnings adjustments, changes in effective income tax rates, and other income tax adjustments.

Suncor Energy Inc.
022 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

Production Volumes


		Three months ended March 31
		2012	2011

Production (mboe/d)		221.2	240.7
	East Coast Canada (mbbls/d)	65.3	65.0
	International (mboe/d)	96.2	107.2
	North America Onshore (mmcfe/d)	358	411

Production mix (liquids/gas) (%)		75/25	68/32
	East Coast Canada	100/0	100/0
	International	99/1	86/14
	North America Onshore	10/90	8/92

For East Coast Canada, production averaged 65,300 bbls/d in the first quarter of 2012, compared to 65,000 bbls/d in the first quarter of 2011.

•: Production from Terra Nova averaged 19,600 bbls/d and increased from 16,900 bbls/d in the prior year quarter. In the first quarter of 2012, several production wells that were shut in due to the presence of hydrogen sulphide (H ₂ S) in the prior year quarter were back on-stream following the installation of a new subsea flow line in the fourth quarter of 2011. In addition, a new production well was completed in the third quarter of 2011. Terra Nova continues to be affected by partial shut-ins of certain wells due to the presence of H ₂ S, which the company expects to fully remediate during the planned maintenance event described below.
•: Production from Hibernia averaged 28,700 bbls/d and decreased slightly from 29,200 bbls/d in the prior year quarter.
•: Production from White Rose averaged 17,000 bbls/d, and decreased from 18,900 bbls/d in the prior year quarter, mainly as a result of natural declines, partially offset by new production from the pilot well in the West White Rose field of the White Rose Extensions.

For International, production averaged 96,200 boe/d in the first quarter of 2012, compared to 107,200 boe/d in the first quarter of 2011.

•: Production from Libya averaged 39,200 bbls/d and increased from 24,100 bbls/d in the prior year quarter when production was completely shut in beginning in March due to political unrest. Production has restarted in all major fields. Suncor is currently engaged in discussions with the National Oil Corporation with respect to the impact of the force majeure period on the company's contractual obligations for its production and development activities. Suncor remains in force majeure for all exploration activities.
•: Production from Buzzard averaged 57,000 boe/d and increased from 50,300 boe/d, due mainly to higher reliability than the prior year period.
•: In December 2011, the company declared force majeure under its contractual obligations in Syria due to political unrest and international sanctions affecting that country. As a result, the company recorded no production from Syria in the first quarter of 2012. In the first quarter of 2011, production from Syrian assets averaged 17,400 boe/d.
•: On March 31, 2011, the company completed its sale of non-core U.K. offshore assets. These properties contributed 15,400 boe/d of production in the first quarter of 2011.

For North America Onshore, production averaged 358 mmcfe/d in the first quarter of 2012, compared to 411 mmcfe/d in the first quarter of 2011.

•: During 2011, the company divested non-core assets that contributed incremental production of approximately 33 mmcfe/d in the prior year quarter.

Suncor Energy Inc.
2012 First Quarter 023

•: Production from remaining properties decreased primarily due to natural declines in reservoir performance and the shut in of a small number of wells in response to low natural gas prices. The company continues to evaluate the possibility for further production shut-ins.

Price Realizations


		Three months ended March 31
Net of transportation costs, but before royalties		2012	2011

Exploration and Production		90.06	77.13
	East Coast Canada ($/bbl)	116.83	104.01
	International ($/boe)	114.54	93.03
	North America Onshore ($/mcfe)	3.71	4.52

In the first quarter of 2012, price realizations for crude oil from East Coast Canada and International were higher than the first quarter of 2011, primarily due to increasing benchmark prices for Brent crude. Price realizations for International were also higher due to the higher relative production mix of crude oil resulting from the suspension of operations in Syria. Price realizations for North America Onshore were lower due mainly to lower benchmark prices for natural gas, partially offset by higher prices for natural gas liquids and crude oil.

Royalties

Royalties for Exploration and Production were higher in the first quarter of 2012, compared with the same period in 2011, due primarily to higher prices for crude oil production. Higher royalties related to the production increase from Libya were largely offset by lower royalties related to the suspension of operations in Syria.

Expenses and Other Factors

Operating expenses were lower in the first quarter of 2012 than in the first quarter of 2011, primarily due to the disposition of non-core U.K. assets in 2011 and the suspension of operations in Syria, partially offset by expenses associated with the drilling rig fire. In March, while drilling a natural gas well in B.C., a fire broke out on the rig. All workers were safely evacuated and the well has since been brought under control. An investigation is underway to determine the cause of the incident.

The factor presented in the bridge analysis of operating earnings for Financing Expense and Other Income is negative, primarily due to the statutory income tax rate increase in the U.K.

Suncor Energy Inc.
024 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

Planned Maintenance Events

The estimated 21-week dockside maintenance program for the Terra Nova Floating Production Storage and Offloading (FPSO) vessel is scheduled to begin in June 2012. The planned work includes the replacement of the FPSO water injection swivel and the completion of the replacement of subsea infrastructure to remediate H ₂ S issues. The estimated 18-week off-station maintenance program for the White Rose FPSO is scheduled to commence in May 2012, primarily to address issues with the FPSO propulsion system. During these outages, there will be no production from the respective assets. Planned maintenance events are scheduled to occur at Hibernia and Buzzard in the third quarter of 2012.

REFINING AND MARKETING

Financial Highlights


		Three months ended March 31
($ millions)		2012	2011

Operating revenues		6 400	5 839

Net earnings		474	627

Operating earnings ⁽¹⁾ ⁽²⁾
	Refining and Product Supply	396	559
	Marketing	78	68

		474	627

Cash flow from operations ⁽¹⁾		741	929

(1): Non-GAAP financial measures. See the Non-GAAP Financial Measures Advisory section of this MD&A.
(2): The company has reclassified the prior year operating earnings split between Refining and Product Supply and Marketing to conform to the current year presentation. Total operating earnings are unchanged.

Refining and Marketing had net and operating earnings of $474 million in the first quarter of 2012, compared with net and operating earnings of $627 million in the first quarter of 2011.

Refining and Product Supply activities contributed $396 million to operating earnings in the first quarter of 2012, which was lower than in the same period in the prior year. In the first quarter of 2011, the uplift to operating earnings with respect to the impact of a rising crude price environment on Suncor's refining margins was approximately $185 million after tax, compared with an uplift of approximately $7 million after tax for the first quarter of 2012. In addition, reduced demand for refined product in Eastern North America resulted in lower crude throughputs at the Montreal and Sarnia refineries. Marketing activities contributed $78 million to operating earnings in the first quarter of 2012, which was higher than in the same period in the prior year, due mainly to stronger margins in wholesale and lubricants channels, partially offset by lower overall sales volumes and margins in retail channels.

Refining and Marketing cash flow from operations was $741 million in the first quarter of 2012, compared to $929 million in the first quarter of 2011, and decreased primarily due to the same factors that affected operating earnings.

Suncor Energy Inc.
2012 First Quarter 025

Operating Earnings

(1): Factors represent after-tax variances and include the impacts of operating earnings adjustments. These factors are analyzed in the narrative immediately subsequent to this bridge analysis. This bridge analysis is provided because management uses this presentation to analyze performance.
(2): The Operating Expense factor includes transportation expense and operating, selling and general expense.
(3): This factor also includes changes in gains and losses on disposal of assets that are not operating earnings adjustments, changes in effective income tax rates, and other income tax adjustments.

Volumes


		Three months ended March 31
		2012	2011

Refined product sales (thousands of m ³ /d)
	Gasoline	38.6	38.1
	Distillate	29.6	31.3
	Other	11.9	12.6

		80.1	82.0

Crude oil processed (thousands of m ³ /d)
	Eastern North America	30.3	33.1
	Western North America	36.4	35.3

Refinery utilization (%) ⁽¹⁾ ⁽²⁾
	Eastern North America	86	97
	Western North America	98	97

(1): Effective January 1, 2012, the company upwardly revised the nameplate capacity of the Montreal refinery from 130,000 bbls/d to 137,000 bbls/d and the nameplate capacity of the Commerce City refinery from 93,000 bbls/d to 98,000 bbls/d. Prior year utilization rates have not been recalculated, and reflect the lower nameplate capacities.
(2): Refinery utilization is the amount of crude oil and natural gas plant liquids run through crude distillation units, expressed as a percentage of the capacity of these units.

Total sales of refined petroleum products averaged 80,100 m ³ /d in the first quarter of 2012, compared to 82,000 m ³ /d in the first quarter of 2011. Gasoline and distillate sales in Eastern North America decreased 9% and 16%, respectively,

Suncor Energy Inc.
026 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

primarily reflecting lower demand for gasoline resulting from higher prices and lower demand for distillate reflecting higher prices and warmer weather conditions. These decreases were partially offset by higher sales volumes in Western North America.

Crude oil processed for Eastern North America averaged 30,300 m ³ /d and decreased from 33,100 m ³ /d in the prior year quarter. This decrease was concurrent with the decrease in demand for refined products, and was also due to an outage for one of the crude distillation towers at the Sarnia refinery, which was restarted successfully in April. Crude oil processed for Western North America averaged 36,400 m ³ /d and increased from 35,300 m ³ /d in the prior year quarter, primarily due to better reliability and scheduled maintenance events at the Commerce City refinery in the first quarter of 2011.

Prices and Margins

Prices for refined products were higher in the first quarter of 2012 than in the first quarter of 2011, reflecting higher refining crack spreads.

For Refining and Product Supply, although WTI prices increased significantly during the first quarters of 2012 and 2011, the impact on earnings pertaining to the increasing crude price environment that benefited the first quarter of 2011 (approximately $185 million after tax) was not repeated in the first quarter of 2012 (approximately $7 million after tax). This effect was the result of a smaller increase in the price of WTI in the first quarter of 2012, compared to the first quarter of 2011, and widening price discounts relative to WTI near the end of the first quarter of 2012 for much of the crude feedstock that the company's inland refineries (Sarnia, Edmonton and Commerce City) process.

For Marketing, higher margins in wholesale channels and higher margins for lubricants products were partially offset by lower margins from the retail channel.

Expenses and Other Factors

Operating expenses were lower in the first quarter of 2012 than in the first quarter of 2011, due primarily to lower share-based compensation expense, partially offset by higher costs for remediation and maintenance. The factor presented in the bridge analysis of operating earnings for Financing Expense and Other Income was negative primarily due to a gain pertaining to the company's investments in marketing entities recorded in the first quarter of 2011.

CORPORATE, ENERGY TRADING AND ELIMINATIONS

Financial Highlights


		Three months ended March 31
($ millions)		2012		2011

Net earnings (loss)		44		(18	)

Operating earnings (loss) ⁽¹⁾
	Renewable Energy	15		15
	Energy Trading	52		39
	Corporate	(133	)	(189	)
	Group Eliminations	(18	)	(45	)

		(84	)	(180	)

Cash flow used in operations ⁽¹⁾		(110	)	(256	)

(1): Non-GAAP financial measures. Operating earnings are reconciled to net earnings below. See also the Non-GAAP Financial Measures Advisory section of this MD&A.

Suncor Energy Inc.
2012 First Quarter 027

Net earnings for Corporate, Energy Trading and Eliminations in the first quarter of 2012 were $44 million, compared with a net loss of $18 million in the first quarter of 2011. In the first quarter of 2012, the Canadian dollar strengthened in relation to the U.S. dollar, with the US$/Cdn$ exchange rate increasing from 0.98 to 1.00 and resulting in an after-tax unrealized foreign exchange gain on U.S. dollar denominated long-term debt of $128 million. In the first quarter of 2011, the Canadian dollar strengthened in relation to the U.S. dollar as the exchange rate increased from 1.01 to 1.03, resulting in an after-tax unrealized foreign exchange gain on U.S. dollar denominated long-term debt of $162 million.

Operating Earnings

The operating loss for Corporate, Energy Trading and Eliminations in the first quarter of 2012 was $84 million, compared with an operating loss of $180 million in the first quarter of 2011.

Operating Earnings Reconciliation


	Three months ended March 31
($ millions)	2012		2011

Net earnings (loss)	44		(18	)
Unrealized foreign exchange gain on U.S. dollar denominated long-term debt	(128	)	(162	)

Operating loss ⁽¹⁾	(84	)	(180	)

(1): Non-GAAP financial measure. See the Non-GAAP Financial Measures Advisory section of this MD&A.

Renewable Energy


	Three months ended March 31
	2012	2011

Power generation marketed (gigawatt hours)	141	55
Ethanol production (millions of litres)	106.4	80.7

Renewable Energy operating earnings of $15 million in the first quarter of 2012 were consistent with operating earnings from the first quarter of 2011. The impacts of higher ethanol production volumes were largely offset by the timing of and contractual limits for government ethanol incentive funding. At the end of January 2011, Suncor completed the expansion of its ethanol plant in Ontario, which increased nameplate production capacity from 200 million litres per year to 400 million litres per year. Total power generation marketed increased to 141 gigawatt hours from 55 gigawatt hours, due mainly to two new wind power projects that commenced operations in 2011 (Wintering Hills in southern Alberta and Kent Breeze in southwest Ontario).

Energy Trading

Energy Trading operating earnings increased to $52 million from $39 million in the prior year quarter, with the increase occurring primarily in heavy crude trading strategies, whereby heavy crude oil is purchased in Alberta and delivered to markets with more favourable prices.

Corporate

The Corporate operating loss was $133 million in the first quarter of 2012, compared with an operating loss of $189 million in the first quarter of 2011. The company capitalized 98% of its borrowing costs in the first quarter of 2012

Suncor Energy Inc.
028 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

as part of the cost of major development assets and construction projects, compared to 62% in the prior year quarter. In addition, lower share-based compensation expense was partially offset by higher DD&A expense that reflected the start of depreciation on Suncor's post-merger systems integration initiative.

Group Eliminations

Group Eliminations include the elimination of profit on crude oil sales from Oil Sands and East Coast Canada to Refining and Product Supply. Consolidated profits are only realized when the company determines that the refined products produced from internal purchases of crude feedstock have been sold to third parties. During the first quarter of 2012, the company eliminated $18 million of after-tax intersegment profit.

6. CAPITAL INVESTMENT UPDATE

Capital and Exploration Expenditures by Segment


	Three months ended March 31
($ millions)	2012	2011

Oil Sands	1 177	1 180
Exploration and Production	206	228
Refining and Marketing	89	106
Corporate, Energy Trading and Eliminations	6	62

Total capital and exploration expenditures	1 478	1 576

Capitalized interest (included in above figures)	158	100

Capital and Exploration Expenditures by Type ⁽¹⁾ ⁽²⁾ ⁽³⁾


		Three months ended March 31, 2012
($ millions)		Sustaining	Growth	Total

Oil Sands		628	399	1 027
	Oil Sands Base	409	25	434
	In Situ	179	295	474
	Oil Sands Ventures	40	79	119
Exploration and Production		26	178	204
Refining and Marketing		88	—	88
Corporate, Energy Trading and Eliminations		1	—	1

		743	577	1 320

(1): Capital expenditures in this table exclude capitalized interest.
(2): Growth capital expenditures include economic capital investments that result in (i) an increase in production levels at existing Oil Sands operations and Refining and Marketing operations, or the investment in new facilities or operations that increases overall production; (ii) an addition of new reserves or a positive change in the company's reserves profile in Exploration and Production operations; or (iii) margin improvement, by increasing revenues or reducing costs.
(3): Sustaining capital expenditures include investments that (i) ensure compliance or maintain goodwill relations with regulators and other stakeholders; (ii) improve efficiency and reliability of operations or maintain productive capacity by replacing component assets at the end of their useful lives; (iii) deliver existing proved developed reserves for Exploration and Production operations; or (iv) maintain current production capacities at existing Oil Sands operations and Refining and Marketing facilities.

In the first quarter of 2012, Suncor spent $1.320 billion on capital for property, plant and equipment and exploration activities, and capitalized $158 million of interest towards major development assets and construction projects. The following paragraphs describe growth and sustaining capital activity for the first quarter of 2012.

Suncor Energy Inc.
2012 First Quarter 029

Oil Sands Base

Oil Sands Base capital and exploration expenditures were $434 million, of which $409 million was directed towards sustaining activities. Sustaining capital expenditures related primarily to the company's TRO _TM initiative, and included $241 million towards the infrastructure project to construct pumping and pipeline facilities for tailings and water transfers across mining operations, and the construction of tailings drying facilities. The company has started commissioning TRO _TM infrastructure assets and expects to start utilizing these assets in the second quarter of 2012. Other sustaining capital expenditures focused on initiatives at Upgrader 1 and Upgrader 2 facilities.

Spending on growth capital projects for Oil Sands Base in the first quarter of 2012 was limited to the completion of assets supporting the North Steepbank mining extension and modifications to the hydrogen plant portion of the MNU, which was taken offline for modifications in the first quarter of 2012. The company expects that the MNU project will be fully operational by mid-year.

In Situ

In Situ capital and exploration expenditures were $474 million, of which $295 million was directed towards growth projects.

•: Capital expenditures for the Firebag Stage 4 expansion were $156 million, bringing total project expenditures to date to approximately $1.344 billion. Construction activities continued to focus on the two new well pads, central processing facilities and cogeneration units. Initial production is targeted for the first quarter of 2013.
•: Capital expenditures for the Firebag Stage 3 expansion were $11 million. Growth spending for Stage 3 is essentially complete, with remaining activities related only to infrastructure projects also required for the Stage 4 expansion. Total Stage 3 project expenditures to date are approximately $4.381 billion.

In Situ sustaining capital expenditures of $179 million were directed primarily to the design and engineering of new well pads that will support existing production levels from MacKay River and Firebag Stages 1 and 2 in future years.

Oil Sands Ventures

Suncor's share of capital expenditures for the Syncrude joint venture was $40 million, which included $17 million for mine train replacement at the Mildred Lake mine and the equipment relocation at the Aurora mine.

During the first quarter of 2012, Oil Sands Ventures growth capital expenditures were $79 million, with (i) the Voyageur upgrader project focusing on validating project scope, developing the project execution plan, engineering and progressing site preparation; (ii) the Fort Hills mining project focusing on progressing design basis memorandum engineering and site preparation, and procuring long-lead items; and (iii) the Joslyn North mining project (operated by Total E&P) focusing on further design work, drilling and site preparation. In 2013, the company expects to present the development plans for all three projects to Suncor's Board of Directors for sanctioning. The development of each of these projects remains subject to approval by the joint venture owners of the respective projects.

Other Capital and Exploration Expenditures

In the first quarter of 2012, the Exploration and Production segment spent $204 million on capital and exploration expenditures. Growth spending included $50 million for Golden Eagle that focused on detailed engineering and the start of construction of topsides and platform jackets. Other growth capital included drilling in the Cardium oil and Montney shale gas formations, and engineering and construction site preparation for the Hebron project. In April, the company commenced drilling the second appraisal well for the Beta discovery in the Norway portion of the North Sea.

Suncor Energy Inc.
030 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

Refining and Marketing spent $88 million on capital expenditures in the first quarter of 2012. The company expects to complete the project to reduce benzene content in gasoline production at the Commerce City refinery in the second quarter of 2012.

7. FINANCIAL CONDITION AND LIQUIDITY

Indicators


Twelve months ended March 31		2012	2011

Return on capital employed (%) ⁽¹⁾
	Excluding major projects in progress	14.8	12.5
	Including major projects in progress	11.0	8.9

Net debt to cash flow from operations ⁽²⁾ (times)		0.6	0.9

Interest coverage on long-term debt (times)
	Earnings basis ⁽³⁾	11.1	10.3
	Cash flow from operations basis ⁽²⁾ ⁽⁴⁾	16.7	14.2

(1): Non-GAAP financial measure. ROCE is reconciled in the Non-GAAP Financial Measures Advisory section of this MD&A.
(2): Cash flow from operations and metrics that use cash flow from operations are non-GAAP financial measures. See the Non-GAAP Financial Measures Advisory section of this MD&A.
(3): Net earnings plus income taxes and interest expense, divided by the sum of interest expense and capitalized interest.
(4): Cash flow from operations plus current income taxes and interest expense, divided by the sum of interest expense and capitalized interest.

Total debt to total debt plus shareholders' equity


($ millions, except as noted)		March 31 2012	December 31 2011

	Short-term debt	749	763
	Current portion of long-term debt	12	12
	Long-term debt	9 853	10 004

Total debt		10 614	10 779
	Less: Cash and cash equivalents	4 648	3 803

Net debt		5 966	6 976

Shareholders' equity		39 692	38 600

Total debt plus shareholders' equity		50 306	49 379

Total debt to total debt plus shareholders' equity (%)		21	22

Suncor Energy Inc.
2012 First Quarter 031

Change in Net Debt


Three months ended March 31, 2012 ($ millions)

Net debt – December 31, 2011		6 976
Decrease in net debt		(1 010	)

Net debt – March 31, 2012		5 966
Decrease in net debt
	Cash flow from operations	2 426
	Capital and exploration expenditures and other investments	(1 478	)
	Proceeds from divestitures, net of costs for acquisitions	37
	Dividends less proceeds from exercise of share options	(68	)
	Repurchase of common shares	(183	)
	Change in non-cash working capital and other	135
	Foreign exchange on cash, long-term debt and other balances	141

		1 010

Capital Resources

Suncor's management believes the company will have the capital resources to fund its planned 2012 capital spending program and meet current and long-term working capital requirements through existing cash balances and short-term investments, cash flow from operations for the remainder of 2012, and available committed credit facilities. The company's cash flow from operations depends on a number of factors, including commodity prices, production and sales volumes, refining and marketing margins, operating expenses, taxes, royalties and foreign exchange rates. If additional capital is required, Suncor's management believes adequate additional financing will be available in debt capital markets at commercial terms and rates.

Due primarily to strong cash flow from operations that exceeded capital expenditures, cash and cash equivalents increased $845 million during the first quarter of 2012, including the effects of returning $183 million to shareholders as part of the share repurchase program. For the twelve months ended March 31, 2012, the company's net debt to cash flow from operations measure was 0.6 times, which met management's target of less than 2.0 times. Unutilized lines of credit at March 31, 2012 were $4.694 billion, compared to $4.428 billion at December 31, 2011.

Financing Activities

Management of debt levels continues to be a priority for Suncor given the company's long-term growth plans. Suncor's management believes a phased and flexible approach to existing and future growth projects should assist Suncor in maintaining its ability to manage project costs and debt levels.

At March 31, 2012, Suncor's net debt was $5.966 billion, compared to $6.976 billion at December 31, 2011. Over the first three months of 2012, net debt decreased by $1.010 billion, largely due to cash flow from operations that exceeded capital and exploration expenditures.

The company expects to maintain access to short-term commercial paper borrowing at competitive interest rates by keeping short-term debt at existing levels (approximately $750 million). During 2011, the company transitioned the majority of its short-term debt to U.S. dollar denominated commercial paper. The company has invested excess cash in short-term financial instruments that are presented as cash and cash equivalents. The objectives of the company's short-term investment portfolio are to ensure the preservation of capital, maintain adequate liquidity to meet Suncor's cash flow requirements and deliver competitive returns consistent with the quality and diversification of investments within

Suncor Energy Inc.
032 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

acceptable risk parameters. The maximum weighted average term to maturity of the short-term investment portfolio will not exceed six months, and all investments will be with counterparties with investment grade debt ratings. As at March 31, 2012, the weighted average term to maturity of the short-term investment portfolio was approximately 55 days.

During the first quarter of 2012, the company obtained regulatory approval to recommence its Normal Course Issuer Bid (NCIB) with the Toronto Stock Exchange that authorizes the purchase for cancellation of up to an additional $1.0 billion of Suncor's common shares between February 28, 2012 and September 5, 2012. Pursuant to the NCIB, during this time, Suncor will not purchase more than 45,839,791 common shares. The actual number of common shares that will be repurchased under the NCIB, and the timing of any such purchases, will be determined by the company. The company subsequently announced that it had entered into a pre-defined purchase plan with a designated broker to allow for the repurchase of common shares during scheduled and unscheduled share trading blackout periods. Shareholders may obtain a copy of the company's Notice of Intention to make a Normal Course Issuer Bid by contacting Investor Relations.

During the first quarter of 2012, the company repurchased 5,466,200 shares at an average price of $33.46 per share, for a total repurchase cost of $183 million. All common shares acquired under the NCIB will be cancelled. As of April 27, 2012, the company had repurchased an additional 4,332,400 shares at an average price of $30.91 per share ($134 million). The company does not expect the decision to allocate cash to the NCIB will affect its long-term growth strategy.

Suncor is subject to financial and operating covenants related to its public market and bank debt. Failure to meet the terms of one or more of these covenants may constitute an Event of Default as defined in the respective debt agreements, potentially resulting in accelerated repayment of one or more of the debt obligations. The company is in compliance with its financial covenant that requires total debt to not exceed 60% of its total debt plus shareholders' equity. At March 31, 2012, total debt to total debt plus shareholders' equity was 21% (December 31, 2011 – 22%). The company is also currently in compliance with all operating covenants.

Outstanding Shares


March 31, 2012 (thousands)

Common shares			1 558 760
Common share options – exercisable and non-exercisable			58 043
Common share options – exercisable			38 458

As at April 25, 2012, the total number of common shares outstanding was 1,560,180,993 and the total number of exercisable and non-exercisable common share options outstanding was 57,085,952. Once exercisable, each outstanding common share option is convertible into one common share.

Contractual Obligations, Commitments, Guarantees, and Off-Balance Sheet Arrangements

In the normal course of business, the company is obligated to make future payments, including contractual obligations and non-cancellable commitments. Suncor has included these items in the Financial Conditions and Liquidity section of its 2011 annual MD&A, which section is herein incorporated by reference. Since December 31, 2011, there have been no material changes to amounts presented in the Contractual Obligations, Commitments, Guarantees, and Off-Balance Sheet Arrangements table. The company does not believe that it has any guarantees or off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on the company's financial condition, results of operations, liquidity or capital expenditures.

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2012 First Quarter 033

Ontario Provincial Budget Proposal

The Province of Ontario budget was presented on March 27, 2012, and proposes to freeze the general corporate income tax rate at 11.5%, instead of the planned reduction to 10% by 2014. The company's preliminary assessment is that, if passed, the budget will result in deferred income tax expense of approximately $65 million to revalue the company's deferred income tax balances.

8. QUARTERLY FINANCIAL DATA

Financial Summary


Three months ended ($ millions, unless otherwise noted)			Mar 31 2012	Dec 31 2011	Sept 30 2011	June 30 2011	Mar 31 2011	Dec 31 2010	Sept 30 2010		June 30 2010

Total production (mboe/d)			562.3	576.5	546.0	460.0	601.3	625.6	635.5		633.9
	Oil Sands		341.1	356.8	362.5	277.2	360.6	363.8	338.3		334.4
	Exploration and Production		221.2	219.7	183.5	182.8	240.7	261.8	297.2		299.5

Revenues and other income
	Operating revenues, net of royalties ⁽¹⁾		9 653	9 906	10 239	9 255	8 943	8 982	7 717		8 174
	Other income		105	60	184	77	132	358	(45	)	287

			9 758	9 966	10 423	9 332	9 075	9 340	7 672		8 461

Net earnings			1 457	1 427	1 287	562	1 028	1 286	1 224		540
	per common share (dollars)
		Basic	0.93	0.91	0.82	0.36	0.65	0.82	0.78		0.35
		Diluted	0.93	0.91	0.76	0.31	0.65	0.82	0.78		0.34

Operating earnings ⁽²⁾			1 329	1 427	1 789	980	1 478	808	617		839
	per common share – basic ⁽²⁾ (dollars)		0.85	0.91	1.14	0.62	0.94	0.52	0.39		0.54

Cash flow from operations ⁽²⁾			2 426	2 650	2 721	1 982	2 393	2 132	1 630		1 770
	per common share – basic ⁽²⁾ (dollars)		1.55	1.69	1.73	1.26	1.52	1.36	1.04		1.13

ROCE ⁽²⁾ (%) for the twelve months ended			14.8	13.8	13.4	11.1	12.5	11.4	9.3		7.9

Common share information (dollars)
	Dividend per common share		0.11	0.11	0.11	0.11	0.10	0.10	0.10		0.10
	Share price at the end of trading
		Toronto Stock Exchange (Cdn$)	32.59	29.38	26.76	37.80	43.48	38.28	33.50		31.33
		New York Stock Exchange (US$)	32.70	28.83	25.44	39.10	44.84	38.29	32.55		29.44

(1): The company has restated 2011 operating revenues to reflect net presentation of certain transactions involving sales and purchases of third-party crude oil production in the Oil Sands segment that were previously presented on a gross basis. See the Other Items – Accounting Polices section of this MD&A.
(2): Non-GAAP financial measures. See the Non-GAAP Financial Measures Advisory section of this MD&A. ROCE excludes capitalized costs related to major projects in progress.

Trends in Suncor's quarterly earnings results and cash flow from operations are driven primarily by production volumes, which can be significantly impacted by major planned maintenance events, such as the one that occurred at Upgrader 2 in Oil Sands in the second quarter of 2011, and unplanned maintenance outages, such as the one that occurred at Upgrader 2 in the first quarter of 2012, and by changes in commodity prices, refining crack spreads and foreign exchange rates.

Suncor Energy Inc.
034 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

Business Environment


Three months ended (average for the period ended, except as noted)		Mar 31 2012	Dec 31 2011	Sept 30 2011	June 30 2011	Mar 31 2011	Dec 31 2010	Sept 30 2010	June 30 2010

WTI crude oil at Cushing	US$/bbl	102.95	94.05	89.75	102.55	94.10	85.20	76.20	78.05
Dated Brent crude oil at Sullom Voe	US$/bbl	118.35	109.00	113.40	117.30	104.95	86.50	76.85	78.30
Dated Brent/Maya FOB price differential	US$/bbl	9.45	5.55	14.80	14.05	15.65	10.85	9.35	10.45
Canadian 0.3% par crude oil at Edmonton	Cdn$/bbl	92.80	98.20	92.50	103.85	88.40	80.70	74.90	75.50
Light/heavy crude oil differential for WTI at Cushing less WCS at Hardisty	US$/bbl	21.45	10.45	17.65	17.65	22.85	18.10	15.65	14.00
Condensate at Edmonton	US$/bbl	110.00	108.70	101.65	112.40	98.35	85.70	74.50	82.70
Natural gas (Alberta spot) at AECO	Cdn$/mcf	2.50	3.45	3.70	3.75	3.80	3.60	3.50	3.85
New York Harbor 3-2-1 crack ⁽¹⁾	US$/bbl	25.80	22.80	36.45	29.25	19.40	12.20	9.60	12.50
Chicago 3-2-1 crack ⁽¹⁾	US$/bbl	18.80	19.20	33.30	29.70	16.45	9.20	10.15	11.05
Portland 3-2-1 crack ⁽¹⁾	US$/bbl	27.70	26.45	36.50	29.35	21.40	13.50	16.60	15.50
Gulf Coast 3-2-1 crack ⁽¹⁾	US$/bbl	25.45	20.40	33.10	27.30	18.50	8.50	8.60	11.20
Exchange rate	US$/Cdn$	1.00	0.98	1.02	1.03	1.01	0.99	0.96	0.97
Exchange rate (end of period)	US$/Cdn$	1.00	0.98	0.95	1.04	1.03	1.01	0.97	0.94

(1): 3-2-1 crack spreads are indicators of the refining margin generated by converting three barrels of WTI into two barrels of gasoline and one barrel of diesel. The crack spreads presented here generally approximate the regions into which the company sells refined products through retail and wholesale channels.

Significant or Unusual Items Impacting Net Earnings

Net earnings over the last eight quarters were affected by the following events or one-time adjustments:

•: The second quarter of 2011 included impairment charges of $514 million against assets in Libya that were associated with the shut in of production due to political unrest, which also decreased production volumes for the majority of 2011.
•: The first quarter of 2011 included a $442 million adjustment to deferred income tax expense related to an increase in U.K. tax rates on oil and gas profits in the North Sea.
•: As part of its strategic business alignment subsequent to the merger with Petro-Canada, Suncor divested a number of non-core assets in its Exploration and Production segment throughout 2010 and 2011. Decreases in production volumes in 2011 are due in part to the disposition of these assets. The resulting gains and losses on the disposition of these assets had one-time impacts on net earnings in the quarters in which they occurred.
•: The fourth quarter of 2010 included an after-tax gain of $186 million for the redetermination of working interests in the Terra Nova oilfield and an after-tax royalty recovery of $93 million with respect to the modification of the bitumen valuation methodology calculation.
•: The second quarter of 2010 included an after-tax write-off of $141 million for Oil Sands assets that were being used in the development of an alternative extraction process.

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2012 First Quarter 035

9. OTHER ITEMS

Accounting Policies

Suncor's significant accounting policies and a summary of recently announced accounting standards are described in notes 3 and 5, respectively, to the audited Consolidated Financial Statements for the year ended December 31, 2011, which notes are herein incorporated by reference.

During the first quarter of 2012, the company completed a review of the presentation of purchase and sale transactions in its Oil Sands segment, and determined that certain transactions previously recorded on a gross basis are more appropriately reflected through net presentation. These transactions represent volumes exchanged with third parties in corresponding sales and purchase agreements, typically when Oil Sands Base or third-party refinery capacities are constrained. Netted sales transactions do not include any Suncor production volumes. Prior period figures have been reclassified for comparability with the current period presentation. The impact of these reclassifications, which did not affect earnings, is as follows:


(decrease in $ millions)	Three months ended March 31, 2011

Gross revenues	(313	)
Purchases of crude oil and products	(313	)

Net earnings	—

Critical Accounting Estimates

The preparation of financial statements in accordance with GAAP requires management to make estimates, judgments and assumptions that affect reported assets, liabilities, revenues and expenses, gains and losses, and disclosures of contingencies. These estimates and assumptions are subject to change based on experience and new information. Critical accounting estimates are those that require management to make assumptions about matters that are highly uncertain at the time the estimate is made. Critical accounting estimates are also those estimates, which, where a different estimate could have been used or where changes in the estimate that are reasonably likely to occur, would have a material impact on the company's financial condition, changes in financial condition or financial performance. Critical accounting estimates are reviewed annually by the Audit Committee of the Board of Directors. A detailed description of Suncor's critical accounting estimates is provided in the Accounting Policies and Critical Accounting Estimates section of Suncor's 2011 annual MD&A, which section is herein incorporated by reference.

Financial Instruments

Suncor periodically enters into derivative contracts such as forwards, futures, swaps, options and costless collars to manage exposure to fluctuations in commodity prices and foreign exchange rates, and to optimize the company's position with respect to interest payments. The company also uses physical and financial energy derivatives to earn trading profits. For more information on Suncor's financial instruments and the related financial risk factors, see note 28 of the audited Consolidated Financial Statements for the year ended December 31, 2011, which note is herein incorporated by reference.

Control Environment

Based on their evaluation as of March 31, 2012, Suncor's Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the United States Securities Exchange Act of 1934 (the Exchange Act)) are effective to ensure that information required to be disclosed by the company in reports that are filed or submitted to Canadian and U.S. securities authorities is recorded,

Suncor Energy Inc.
036 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

processed, summarized and reported within the time periods specified in Canadian and U.S. securities laws. In addition, as of March 31, 2012, there were no changes in the internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) – 15d-15(f)) that occurred during the three-month period ended March 31, 2012 that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting. Management will continue to periodically evaluate the company's disclosure controls and procedures and internal control over financial reporting and will make any modifications from time to time as deemed necessary.

As a result of past unrest in Libya and current events in Syria, Suncor is not able to monitor the status of all of its facilities, including whether certain facilities have suffered damages. Suncor has assessed and is continually monitoring the control environment in these countries and does not consider the changes to have a material impact on the company's overall internal control over financial reporting.

Based on their inherent limitations, disclosure controls and procedures and internal control over financial reporting may not prevent or detect misstatements, and even those controls determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Corporate Guidance

Suncor has updated its 2012 corporate guidance that was previously issued on February 1, 2012. The press release of Suncor dated April 30, 2012, which is also available on www.sedar.com, provides the new guidance and the reasons for the revisions.

10. NON-GAAP FINANCIAL MEASURES ADVISORY

Certain financial measures in this MD&A – namely operating earnings, ROCE, cash flow from operations and Oil Sands cash operating costs – are not prescribed by GAAP. These non-GAAP financial measures do not have any standardized meaning and therefore are unlikely to be comparable to similar measures presented by other companies. These non-GAAP financial measures are included because management uses the information to analyze operating performance, leverage and liquidity. Therefore, these non-GAAP financial measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Except as otherwise indicated, these non-GAAP measures are calculated and disclosed on a consistent basis from period to period. Specific adjusting items may only be relevant in certain periods.

Operating Earnings

Operating earnings is a non-GAAP financial measure that adjusts net earnings for significant items that are not indicative of operating performance. Management uses operating earnings to evaluate operating performance, because management believes it provides better comparability between periods.

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2012 First Quarter 037

Return on Capital Employed (ROCE)

ROCE is a non-GAAP financial measure that management uses to analyze operating performance and the efficiency of Suncor's capital allocation process. Average capital employed is calculated as a thirteen-month average of the capital employed balance at the beginning of the twelve-month period and the month-end capital employed balances throughout the remainder of the twelve-month period. Figures for capital employed at the beginning and end of the twelve-month period are presented to show the changes in the components of the calculation over the twelve-month period.

For the twelve months ended March 31
($ millions, except as noted)

2012

2011

Adjustments to net earnings

Net earnings

4 733

4 082

Add after-tax amounts for:

Unrealized foreign exchange loss (gain) on U.S. dollar denominated long-term debt

195

(308

)

Interest expense

300

4 968

4 074

Capital employed – beginning of twelve-month period

Net debt

7 438

13 311

Shareholders' equity

36 400

32 622

43 838

45 933

Capital employed – end of twelve-month period

Net debt

5 966

7 438

Shareholders' equity

39 692

36 400

45 658

43 838

Average capital employed

45 153

45 684

ROCE – including major projects in progress (%)

A/B

11.0

8.9

Average capitalized costs related to major projects in progress

11 516

13 045

ROCE – excluding major projects in progress (%)

A/(B-C)

14.8

12.5

Suncor Energy Inc.
038 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

Cash Flow from Operations

Cash flow from operations is a non-GAAP financial measure that adjusts a GAAP measure – cash flow provided by operating activities – for changes in non-cash working capital, which management uses to analyze operating performance and liquidity. Changes to non-cash working capital can include, among other factors, fluctuations for the timing or payment of share-based compensation amounts, offshore feedstock purchases, and fuel and income taxes, which management believes reduces comparability between periods.


Three months ended March 31		Oil Sands				Exploration and Production				Refining and Marketing				Corporate, Energy Trading and Eliminations				Total
($ millions)		2012		2011		2012		2011		2012		2011		2012		2011		2012		2011

Net earnings (loss)		607		605		332		(186	)	474		627		44		(18	)	1 457		1 028
Adjustments for:
	Depreciation, depletion, amortization and impairment	440		311		360		354		111		102		36		18		947		785
	Deferred income taxes	213		190		(7	)	253		150		203		(38	)	(44	)	318		602
	Accretion of liabilities	29		18		16		19		1		1		—		—		46		38
	Unrealized foreign exchange gain on U.S. dollar denominated long-term debt	—		—		—		—		—		—		(146	)	(186	)	(146	)	(186	)
	Change in fair value of derivative contracts	—		—		(2	)	—		(2	)	3		(35	)	(58	)	(39	)	(55	)
	(Gain) loss on disposal of assets	(29	)	112		—		146		(2	)	(6	)	—		(1	)	(31	)	251
	Share-based compensation	18		48		3		9		8		37		16		79		45		173
	Exploration expenses	—		—		—		2		—		—		—		—		—		2
	Settlement of decommissioning and restoration liabilities	(153	)	(133	)	(10	)	(3	)	(3	)	(2	)	—		—		(166	)	(138	)
	Other	(7	)	(14	)	(15	)	(11	)	4		(36	)	13		(46	)	(5	)	(107	)

Cash flow from (used in) operations		1 118		1 137		677		583		741		929		(110	)	(256	)	2 426		2 393
(Increase) decrease in non-cash working capital		(386	)	(721	)	(94	)	541		(217	)	(663	)	745		968		48		125

Cash flow provided by operating activities		732		416		583		1 124		524		266		635		712		2 474		2 518

Oil Sands Cash Operating Costs

Oil Sands cash operating costs and cash operating costs per barrel are non-GAAP financial measures, which are derived by adjusting Oil Sands segment operating, selling and general expense (a GAAP measure based on sales volumes) for (i) costs pertaining to Syncrude operations; (ii) non-production costs that management believes do not relate to the production performance of Oil Sands operations including, but not limited to, share-based compensation adjustments, costs related to the remobilization or deferral of growth projects, research, the expense recorded as part of a non-monetary arrangement

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2012 First Quarter 039

involving a third-party processor and feedstock costs for natural gas used to create hydrogen for secondary upgrading processes; (iii) excess power generated and sold that is recorded in operating revenue; and (iv) the impacts of changes in inventory levels, such that the company is able to present cost information based on production volumes. Oil Sands cash operating costs are reconciled in the Segmented Results and Analysis – Oil Sands section of this MD&A.

Effective 2012, the calculation of Oil Sands cash operating costs has been updated to better reflect the ongoing cash cost of production, and prior period figures have been re-determined. The cost of natural gas feedstock for secondary upgrading processes, the cost of diluent purchased for transportation of product to markets, and non-cash costs related to the accretion of liabilities for decommissioning and restoration provisions are no longer included in cash operating costs. Certain cash costs relating to safety programs, which were previously considered non-production costs, are now included in cash operating costs. The following table reconciles amounts previously reported to those presented in this MD&A:


		Three months ended March 31, 2011
		$ millions		$/bbl

Cash operating costs, as previously reported		1 050		36.15
Elements added to cash operating costs definition:
	Safety programs	8
Elements removed from cash operating costs definition:
	Natural gas feedstock for secondary upgrading processes	(14	)
	Accretion of liabilities	(16	)
	Purchased diluent	—

Cash operating costs, as restated in this MD&A		1 028		35.45

11. ADVISORY – FORWARD-LOOKING INFORMATION

The MD&A contains certain forward-looking statements and other information based on Suncor's current expectations, estimates, projections and assumptions that were made by the company in light of information available at the time the statement was made and consider Suncor's experience and its perception of historical trends, including expectations and assumptions concerning: the accuracy of reserves and resources estimates; commodity prices and interest and foreign exchange rates; capital efficiencies and cost-savings; applicable royalty rates and tax laws; future production rates; the sufficiency of budgeted capital expenditures in carrying out planned activities; the availability and cost of labour and services; and the receipt, in a timely manner, of regulatory and third-party approvals. In addition, all other statements and other information that address expectations or projections about the future, and other statements and information about Suncor's strategy for growth, expected and future expenditures or investment decisions, commodity prices, costs, schedules, production volumes, operating and financial results, future financing and capital activities, and the expected impact of future commitments are forward-looking statements. Some of the forward-looking statements and information may be identified by words like "expects", "anticipates", "estimates", "plans", "scheduled", "intends", "believes", "projects", "indicates", "could", "focus", "vision", "goal", "outlook", "proposed", "target", "objective", "continue" and similar expressions.

Forward-looking statements in the MD&A include references to:

Suncor's expectations about production volumes and the performance of its existing assets, including that:

•: The Firebag steam-to-oil ratio will decrease in future periods as the ramp up of production from the Stage 3 expansion continues;
•: The company will encounter an area of lower bitumen ore grade quality at the Millennium mine face through to the start of the fourth quarter of 2012; and
•: In the second quarter of 2012, the impacts of the Upgrader 2 outage will affect sales volumes and the company will rebuild inventory levels.

The anticipated duration and impact of planned maintenance events, including:

•: The company's plans to shut down one coker unit at Upgrader 1 for routine maintenance in the second quarter of 2012, and that production will not be significantly impacted by this event;

Suncor Energy Inc.
040 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

•: The company's plans to complete routine maintenance on the vacuum tower and secondary upgrading units, and shut down one coker unit at Upgrader 2 in the third quarter of 2012, and that the impact of maintenance on the vacuum tower on overall production levels has been factored into production forecasts;
•: Planned maintenance for secondary upgrading units at Upgrader 1 scheduled to occur in 2013;
•: The two-month outage for a coker unit scheduled for the second quarter of 2012 at Syncrude;
•: The 21-week dockside maintenance program scheduled to begin in June 2012 for the Terra Nova FPSO, which is expected to include the replacement of the FPSO water injection swivel and complete the replacement of subsea infrastructure to remediate H ₂ S issues;
•: The 18-week off-station maintenance program for the White Rose FPSO, which is scheduled to commence in May 2012, primarily to address issues with the FPSO propulsion system; and
•: The planned maintenance events scheduled to occur at Hibernia and Buzzard in the third quarter of 2012.

Suncor's expectations about where future capital expenditures will be directed and the timing for completion of growth and other significant projects, including that:

•: Project start-up activity for the Firebag Stage 4 expansion will increase in the second half of 2012, with initial production targeted for the first quarter of 2013;
•: The company will start utilizing TRO _TM infrastructure assets in the second quarter of 2012;
•: The MNU will be fully operational by mid-year;
•: New well pad construction will support existing production levels from MacKay River and Firebag Stages 1 and 2 in future years;
•: Plans for 2013 to present to Suncor's Board of Directors for sanctioning the development plans for the Voyageur upgrader, Fort Hills mining and Joslyn North mining projects; and
•: The company will complete the project to reduce benzene content in gasoline production at the Commerce City refinery in the second quarter of 2012.

Also:

•: The company anticipates that safe mode costs in 2012 will largely consist of the costs to assess the condition of assets coming out of safe mode and the costs of remobilizing equipment and personnel;
•: The company's preliminary assessment that, if passed, the proposed Ontario budget will result in deferred income tax expense of approximately $65 million to revalue the company's deferred income tax balances;
•: Management's belief that Suncor will have the capital resources to fund its planned 2012 capital spending program and to meet current and long-term working capital requirements through existing cash balances and short-term investments, cash flow from operations for the remainder of 2012, and available committed credit facilities, and that if additional capital is required, adequate additional financing will be available to Suncor in the debt capital markets at commercial terms and rates;
•: Management's belief that a phased and flexible approach to existing and future growth projects should assist Suncor in maintaining its ability to manage project costs and debt levels;
•: The company's belief that it does not have any guarantees or off-balance sheet arrangements that are reasonably likely to have a future material impact on the company's financial condition, results of operations, liquidity or capital expenditures;
•: The company's plans to maintain short-term commercial paper borrowing at competitive interest rates by keeping short-term debt at existing levels;
•: The company's expectation that the decision to allocate cash to the NCIB will not affect its long-term growth strategy; and
•: The company's expectations that the maximum weighted average term to maturity of its short-term investment portfolio will not exceed six months, and that all investments will be with counterparties with investment grade debt ratings.

Forward-looking statements and information are not guarantees of future performance and involve a number of risks and uncertainties, some that are similar to other oil and gas companies and some that are unique to Suncor. Suncor's actual results may differ materially from those expressed or implied by its forward-looking statements, so readers are cautioned not to place undue reliance on them.

The financial and operating performance of the company's reportable operating segments, specifically Oil Sands, Exploration and Production, and Refining and Marketing, may be affected by a number of factors.

Factors that affect our Oil Sands segment include, but are not limited to, volatility in the prices for crude oil and other production, and the related impacts of fluctuating light/heavy and sweet/sour crude oil differentials; changes in the demand for refinery feedstock and diesel fuel, including the possibility that refiners that process our proprietary production will be closed, experience equipment failure or other accidents; our ability to operate our oil sands facilities reliably in order to meet production targets; the output of newly commissioned facilities, the performance of which may be difficult to predict during initial operations; the possibility that completed maintenance activities may not improve operational performance or the output of related facilities; our dependence on pipeline capacity and other logistical constraints, which may affect our ability to distribute our products to market; our ability to finance oil sands growth and sustaining capital expenditures; the availability of bitumen feedstock for upgrading operations, which can be negatively affected by poor ore grade quality, unplanned mine equipment and extraction plant maintenance, tailings storage, and in situ reservoir and equipment performance, or the unavailability of third-party bitumen; inflationary pressures on operating costs, including labour, natural gas and other energy sources in oil sands processes; our ability

Suncor Energy Inc.
2012 First Quarter 041

to complete projects, including planned maintenance events, both on time and on budget, which could be impacted by competition from other projects (including other oil sands projects) for goods and services and demands on infrastructure in Fort McMurray and the surrounding area (including housing, roads and schools); risks and uncertainties associated with obtaining regulatory and stakeholder approval for exploration and development activities; changes to royalty and tax legislation and related agreements that could impact our business, such as our current dispute with the Alberta Department of Energy in respect of the Bitumen Valuation Methodology Regulation; the potential for disruptions to operations and construction projects as a result of our relationships with labour unions that represent employees at our facilities; and changes to environmental regulations or legislation.

Factors that affect our Exploration and Production segment include, but are not limited to, volatility in crude oil and natural gas prices; operational risks and uncertainties associated with oil and gas activities, including unexpected formations or pressures, premature declines of reservoirs, fires, blow-outs, equipment failures and other accidents, uncontrollable flows of crude oil, natural gas or well fluids, and pollution and other environmental risks; the possibility that completed maintenance activities may not improve operational performance or the output of related facilities; adverse weather conditions, which could disrupt output from producing assets or impact drilling programs, resulting in increased costs and/or delays in bringing on new production; political, economic and socio-economic risks associated with Suncor's foreign operations, including the unpredictability of operating in Libya and that operations in Syria continue to be impacted by sanctions or political unrest; risks and uncertainties associated with obtaining regulatory and stakeholder approval for exploration and development activities; the potential for disruptions to operations and construction projects as a result of our relationships with labour unions that represent employees at our facilities; and market demand for mineral rights and producing properties, potentially leading to losses on disposition or increased property acquisition costs.

Factors that affect our Refining and Marketing segment include, but are not limited to, fluctuations in demand and supply for refined products that impact the company's margins; market competition, including potential new market entrants; our ability to reliably operate refining and marketing facilities in order to meet production or sales targets; the possibility that completed maintenance activities may not improve operational performance or the output of related facilities; risks and uncertainties affecting construction or planned maintenance schedules, including the availability of labour and other impacts of competing projects drawing on the same resources during the same time period; and the potential for disruptions to operations and construction projects as a result of our relationships with labour unions or employee associations that represent employees at our refineries and distribution facilities.

Additional risks, uncertainties and other factors that could influence financial and operating performance of all of Suncor's operating segments and activities include, but are not limited to, changes in general economic, market and business conditions, such as commodity prices, interest rates and currency exchange rates; fluctuations in supply and demand for Suncor's products; the successful and timely implementation of capital projects, including growth projects and regulatory projects; competitive actions of other companies, including increased competition from other oil and gas companies or from companies that provide alternative sources of energy; labour and material shortages; actions by government authorities, including the imposition of taxes or changes to fees and royalties, and changes in environmental and other regulations; the ability and willingness of parties with whom we have material relationships to perform their obligations to us; the occurrence of unexpected events such as fires, equipment failures and other similar events affecting Suncor or other parties whose operations or assets directly or indirectly affect Suncor; the potential for security breaches of Suncor's information systems by computer hackers or cyberterrorists, and the unavailability or failure of such systems to perform as anticipated as a result of such breaches; our ability to find new oil and gas reserves that can be developed economically; the accuracy of Suncor's reserves, resources and future production estimates; market instability affecting Suncor's ability to borrow in the capital debt markets at acceptable rates; maintaining an optimal debt to cash flow ratio; the success of the company's risk management activities using derivatives and other financial instruments; the cost of compliance with current and future environmental laws; risks and uncertainties associated with closing a transaction for the purchase or sale of an oil and gas property, including estimates of the final consideration to be paid or received, the ability of counterparties to comply with their obligations in a timely manner and the receipt of any required regulatory or other third-party approvals outside of Suncor's control that are customary to transactions of this nature; and the accuracy of cost estimates, some of which are provided at the conceptual or other preliminary stage of projects and prior to commencement or conception of the detailed engineering that is needed to reduce the margin of error and increase the level of accuracy. The foregoing important factors are not exhaustive.

Many of these risk factors and other assumptions related to Suncor's forward-looking statements and information are discussed in further detail throughout this MD&A, and under the heading Risk Factors in the 2011 annual MD&A, the 2011 AIF and Form 40-F on file with Canadian securities commissions at www.sedar.com and the United States Securities and Exchange Commission at www.sec.gov. Readers are also referred to the risk factors and assumptions described in other documents that Suncor files from time to time with securities regulatory authorities. Copies of these documents are available without charge from the company.

Suncor Energy Inc.
042 2012 First Quarter For more information about Suncor Energy, visit our website www.suncor.com

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Exhibit 5.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in this registration statement on Form F-9 dated May 15, 2012 of our report dated February 23, 2012 relating to the consolidated balance sheets of Suncor Energy Inc. as at December 31, 2011, December 31, 2010 and January 1, 2010 and the consolidated statements of comprehensive income, changes in shareholders' equity and cash flows for each of the years in the two year period ended December 31, 2011 and the effectiveness of internal control over financial reporting of Suncor Energy Inc. as at December 31, 2011, which appears in Suncor Energy Inc.'s Annual Report on Form 40-F for the year ended December 31, 2011. We also consent to the references to us under the heading "Interest of Experts" in the base shelf prospectus contained in the registration statement on Form F-9.

/s/ PricewaterhouseCoopers LLP
Chartered Accountants
Calgary, Alberta
May 15, 2012

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CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Exhibit 5.2

May 15, 2012

The Securities and Exchange Commission

Re: F-9 Registration Statement of Suncor Energy Inc. (the "Corporation")

Dear Sirs/Mesdames:

We hereby consent to references to our firm name on the face page of the registration statement on Form F-9 dated May 15, 2012 (the "Registration Statement") filed by the Corporation under the Securities Act of 1933, as amended (the "Act") and under the headings "Legal Matters," "Enforceability of Civil Liabilities" and "Interest of Experts" in the prospectus of the Corporation that forms a part of the Registration Statement. In giving this consent, we do not thereby admit that we come within the category of persons whose consent is required by the Act or the rules thereunder.

Yours truly,

/s/ BLAKE, CASSELS & GRAYDON LLP

Blake, Cassels & Graydon LLP

Exhibit 5.3

LETTER OF CONSENT

TO: The Securities and Exchange Commission

Re: Registration Statement on Form F-9 dated May 15, 2012 (the "Registration Statement") of Suncor Energy Inc. (the "Corporation")

We are a firm of independent petroleum consultants of Calgary, Alberta having prepared a report evaluating the Corporation's reserves as at December 31, 2011, as described in the Annual Information Form ("AIF") of the Corporation dated March 1, 2012.

We refer to the Registration Statement dated May 15, 2012 relating to the offering of Debt Securities from time to time by the Corporation and hereby consent to the reference to our firm under the heading "Interest of Experts" and to the use of our Report which is incorporated in the Registration Statement by reference to the AIF.

Yours Faithfully

	GLJ PETROLEUM CONSULTANTS LTD.
	By:	/s/ CARALYN P. BENNETT
		Name: Caralyn P. Bennett, P. Eng. Title: Vice President
Dated: May 15, 2012 Calgary, Alberta CANADA

Exhibit 5.4

May 15, 2012

United States Securities and Exchange Commission

Re:

Registration Statement on Form F-9 dated May 15, 2012
(the "Registration Statement") of Suncor Energy Inc.

Dear Sirs:

We are a firm of independent qualified reserves evaluators of Calgary, Alberta having prepared reports evaluating the reserves of Suncor Energy Inc. as at December 31, 2011, as described in the Annual Information Form ("AIF") of Suncor Energy Inc. dated March 1, 2012.

We refer to the Registration Statement relating to the offering of Debt Securities by Suncor Energy Inc. and hereby consent to the reference to our firm under the heading "Interest of Experts" and to the use of our Report which is incorporated in the Registration Statement by reference to the AIF.

	Sincerely,
	SPROULE ASSOCIATES LIMITED and SPROULE INTERNATIONAL LIMITED
	By:		/s/ HARRY J. HELWERDA
	Name: Harry J. Helwerda, P.Eng., FEC Title: Executive Vice President

Dated: May 15, 2012
Calgary, Alberta
CANADA

Exhibit 7.1

SUNCOR ENERGY INC.,
as Issuer

and

THE BANK OF NEW YORK,
as Trustee

Indenture

Dated as of June 25, 2007

Providing for the issue of
Debt Securities
in unlimited principal amount

SUNCOR ENERGY INC.

Reconciliation and tie between Trust Indenture Act
of 1939 and Indenture, dated as of June 25, 2007

Trust Indenture Act Section				Indenture Section
§310(a)(1)				607
(a)(2)				607
(b)				608
§312(c)				701
§314(a)				705
(a)(4)				1004
(c)(1)				102
(c)(2)				102
(e)				102
§315(b)				601
§316(a)(last sentence)				101 ("Outstanding")
(a)(1)(A)				512
(a)(1)(B)				502, 513
(b)				508
(c)				104(e)
§317(a)(1)				503
(a)(2)				504
(b)				1003
§318(a)				116

Note: This reconciliation and tie shall not, for any purpose, be deemed to be a part of the Indenture.

TABLE OF CONTENTS

		Page
PARTIES		1
RECITALS OF THE COMPANY		1
ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions		1
	" Accelerated Indebtedness "	2
	" Act "	2
	" Additional Amounts "	2
	" Affiliate "	2
	" Authenticating Agent "	2
	" Authorized Newspaper "	2
	" Bearer Security "	2
	" Board of Directors "	2
	" Board Resolution "	2
	" Business Day "	2
	" calculation period "	3
	" Canadian Taxes "	3
	" Capital Lease Obligation "	3
	" Clearstream "	3
	" Commission "	3
	" Common Depositary "	3
	" Company "	3
	" Company Request " or " Company Order "	3
	" Consolidated Net Tangible Assets "	3
	" Component Currency "	3
	" Conversion Date "	4
	" Conversion Event "	4
	" Corporate Trust Office "	4
	" corporation "	4
	" coupon "	4
	" covenant defeasance "	4
	" Currency "	4
	" Current Assets "	4
	" Debt "	4

Note: This table of contents shall not, for any purpose, be deemed to be a part of the Indenture.

	" Default "	4
	" Defaulted Interest "	4
	" defeasance "	5
	" Depositary for Securities "	5
	" Dollar " or " $ "	5
	" Dollar Equivalent of the Currency Unit "	5
	" Dollar Equivalent of the Foreign Currency "	5
	" Election Date "	5
	" Equity Interest "	5
	" Euro "	5
	" Euroclear "	5
	" Event of Default "	5
	" Exchange Date "	5
	" Exchange Rate Agent "	5
	" Exchange Rate Officer's Certificate "	5
	" Excluded Holder "	5
	" Extension Notice "	5
	" Extension Period "	6
	" Final Maturity "	6
	" Financial Instrument Obligations "	6
	" First Currency "	6
	" Foreign Currency "	6
	" GAAP "	6
	" Government Obligations "	6
	" Holder "	7
	" Indenture "	7
	" Indexed Security "	7
	" interest "	7
	" Interest Payment Date "	7
	" Judgment Currency "	7
	" Lien "	7
	" mandatory sinking fund payment "	7
	" Market Exchange Rate "	8
	" Maturity "	8
	" Officers' Certificate "	8
	" Opinion of Counsel "	8
	" Optional Reset Date "	8
	" optional sinking fund payment "	8
	" Original Issue Discount Security "	8
	" Original Stated Maturity "	8
	" Outstanding "	9
	" Paying Agent "	10
	" Person "	10
	" Place of Payment "	10
	" Predecessor Security "	10
	" Property "	10
	" Purchase Money Mortgage "	10
	" Purchase Money Obligation "	10

	" rate(s) of exchange "	11
	" Redemption Date "	11
	" Redemption Price "	11
	" Registered Security "	11
	" Regular Record Date "	11
	" Repayment Date "	11
	" Repayment Price "	11
	" Required Currency "	11
	" Reset Notice "	11
	" Responsible Officer "	11
	" Restricted Subsidiary "	11
	" Securities "	11
	" Security Register " and " Security Registrar "	12
	" Shareholders' Equity "	12
	" Special Record Date "	12
	" Specified Amount "	12
	" Stated Maturity "	12
	" Subsidiary "	12
	" Subsequent Interest Period "	12
	" Trust Indenture Act " or " TIA "	12
	" Trustee "	12
	" United States "	12
	" United States person "	12
	" Valuation Date "	13
	" Vice President "	13
	" Voting Shares "	13
	" Yield to Maturity "	13
	" Wholly Owned Subsidiary "	13
SECTION 102. Compliance Certificates and Opinions		13
SECTION 103. Form of Documents Delivered to Trustee		14
SECTION 104. Acts of Holders		14
SECTION 105. Notices, etc. to Trustee and Company		16
SECTION 106. Notice to Holders; Waiver		16
SECTION 107. Effect of Headings and Table of Contents		17
SECTION 108. Successors and Assigns		17
SECTION 109. Separability Clause		17
SECTION 110. Benefits of Indenture		18
SECTION 111. Governing Law		18
SECTION 112. Legal Holidays		18
SECTION 113. Agent for Service; Submission to Jurisdiction; Waiver of Immunities		18
SECTION 114. Conversion of Currency		19
SECTION 115. Currency Equivalent		20
SECTION 116. Conflict with Trust Indenture Act		20
SECTION 117. Incorporators, Shareholders, Officers and Directors of the Company Exempt from Individual Liability		20
SECTION 118. Security Interest		20

iii

ARTICLE TWO SECURITIES FORMS
SECTION 201. Forms Generally		21
SECTION 202. Form of Trustee's Certificate of Authentication		22
SECTION 203. Securities Issuable in Global Form		22
ARTICLE THREE THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series		23
SECTION 302. Denominations		27
SECTION 303. Execution, Authentication, Delivery and Dating		27
SECTION 304. Temporary Securities		29
SECTION 305. Registration, Registration of Transfer and Exchange		32
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities		35
SECTION 307. Payment of Principal and Interest; Interest Rights Preserved; Optional Interest Reset		36
SECTION 308. Optional Extension of Stated Maturity		39
SECTION 309. Persons Deemed Owners		40
SECTION 310. Cancellation		40
SECTION 311. Computation of Interest		41
SECTION 312. Currency and Manner of Payments in Respect of Securities		41
SECTION 313. Appointment and Resignation of Successor Exchange Rate Agent		44
ARTICLE FOUR SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture		45
SECTION 402. Application of Trust Money		46
ARTICLE FIVE REMEDIES
SECTION 501. Events of Default		46
SECTION 502. Acceleration of Maturity; Rescission and Annulment		48
SECTION 503. Collection of Debt and Suits for Enforcement by Trustee		49
SECTION 504. Trustee May File Proofs of Claim		50
SECTION 505. Trustee May Enforce Claims Without Possession of Securities		50
SECTION 506. Application of Money Collected		51
SECTION 507. Limitation on Suits		51
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and Interest		52
SECTION 509. Restoration of Rights and Remedies		52
SECTION 510. Rights and Remedies Cumulative		52
SECTION 511. Delay or Omission Not Waiver		52
SECTION 512. Control by Holders		53

SECTION 513. Waiver of Past Defaults		53
SECTION 514. Waiver of Stay or Extension Laws		53
ARTICLE SIX THE TRUSTEE
SECTION 601. Notice of Defaults		54
SECTION 602. Certain Rights of Trustee		54
SECTION 603. Trustee Not Responsible for Recitals or Issuance of Securities		55
SECTION 604. May Hold Securities		56
SECTION 605. Money Held in Trust		56
SECTION 606. Compensation and Reimbursement		56
SECTION 607. Corporate Trustee Required; Eligibility		57
SECTION 608. Resignation and Removal; Appointment of Successor		57
SECTION 609. Acceptance of Appointment by Successor		59
SECTION 610. Merger, Conversion, Consolidation or Succession to Business		60
SECTION 611. Appointment of Authenticating Agent		60
ARTICLE SEVEN HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders		62
SECTION 702. Preservation of List of Names and Addresses of Holders		62
SECTION 703. Disclosure of Names and Addresses of Holders		62
SECTION 704. Reports by Trustee		63
SECTION 705. Reports by the Company		63
ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, etc., Only on Certain Terms		64
SECTION 802. Successor Person Substituted		65
SECTION 803. Securities to Be Secured in Certain Events		66
ARTICLE NINE SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders		66
SECTION 902. Supplemental Indentures with Consent of Holders		68
SECTION 903. Execution of Supplemental Indentures		69
SECTION 904. Effect of Supplemental Indentures		69
SECTION 905. Conformity with Trust Indenture Act		69
SECTION 906. Reference in Securities to Supplemental Indentures		69
SECTION 907. Notice of Supplemental Indentures		69

ARTICLE TEN COVENANTS
SECTION 1001. Payment of Principal, Premium, if any, and Interest		70
SECTION 1002. Maintenance of Office or Agency		70
SECTION 1003. Money for Securities Payments to Be Held in Trust		71
SECTION 1004. Statement as to Compliance and Notice of Default		73
SECTION 1005. Additional Amounts		73
SECTION 1006. Payment of Taxes and Other Claims		74
SECTION 1007. To Carry on Business		74
SECTION 1008. Corporate Existence		75
SECTION 1009. Limitation on Liens		75
SECTION 1010. Waiver of Certain Covenants		77
SECTION 1011. Calculation of Original Issue Discount		77
ARTICLE ELEVEN REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article		78
SECTION 1102. Election to Redeem; Notice to Trustee		78
SECTION 1103. Selection by Trustee of Securities to Be Redeemed		78
SECTION 1104. Notice of Redemption		78
SECTION 1105. Deposit of Redemption Price		79
SECTION 1106. Securities Payable on Redemption Date		80
SECTION 1107. Securities Redeemed in Part		80
SECTION 1108. Tax Redemption		81
ARTICLE TWELVE SINKING FUNDS
SECTION 1201. Applicability of Article		81
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities		82
SECTION 1203. Redemption of Securities for Sinking Fund		82
ARTICLE THIRTEEN REPAYMENT AT OPTION OF HOLDERS
SECTION 1301. Applicability of Article		83
SECTION 1302. Repayment of Securities		83
SECTION 1303. Exercise of Option		84
SECTION 1304. When Securities Presented for Repayment Become Due and Payable		84
SECTION 1305. Securities Repaid in Part		85

ARTICLE FOURTEEN DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1401. Company's Option to Effect Defeasance or Covenant Defeasance		85
SECTION 1402. Defeasance and Discharge		86
SECTION 1403. Covenant Defeasance		86
SECTION 1404. Conditions to Defeasance or Covenant Defeasance		87
SECTION 1405. Deposited Money and Government Obligations to Be Held in Trust; Other Miscellaneous Provisions		88
SECTION 1406. Reinstatement		89
ARTICLE FIFTEEN MEETINGS OF HOLDERS OF SECURITIES
SECTION 1501. Purposes for Which Meetings May Be Called		90
SECTION 1502. Call, Notice and Place of Meetings		90
SECTION 1503. Persons Entitled to Vote at Meetings		90
SECTION 1504. Quorum; Action		91
SECTION 1505. Determination of Voting Rights; Conduct and Adjournment of Meetings		92
SECTION 1506. Counting Votes and Recording Action of Meetings		93
SECTION 1507. Waiver of Jury Trial		93
FORMS OF CERTIFICATION		EXHIBIT A

vii

INDENTURE, dated as June 25, 2007 between SUNCOR ENERGY INC., a corporation duly organized and existing under the laws of Canada (herein called the " Company "), having its principal office at 112-4 ^th Avenue S.W., Calgary, Alberta T2P 2V5, and THE BANK OF NEW YORK, a New York banking corporation, as trustee (herein called the " Trustee ").

RECITALS OF THE COMPANY

The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured debentures, notes or other evidences of indebtedness (herein called the " Securities "), which may be convertible into or exchangeable for any securities of any person (including the Company), to be issued in one or more series as in this Indenture provided.

This Indenture is subject to the provisions of the Trust Indenture Act of 1939, as amended, that are required to be part of this Indenture and shall, to the extent applicable, be governed by such provisions.

All things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done.

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

For and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of the Securities or of series thereof, as follows:

ARTICLE ONE

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

SECTION 101. Definitions.

For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:

(1) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;

(2) all other terms used herein which are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein, and the terms "cash transaction" and "self-liquidating paper", as used in TIA Section 311, shall have the meanings assigned to them in the rules of the Commission adopted under the Trust Indenture Act;

(3) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP; and

(4) the words "herein", "hereof" and "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.

Certain terms, used principally in Article Three, are defined in that Article.

" Accelerated Indebtedness " has the meaning specified in Section 501.

" Act ", when used with respect to any Holder, has the meaning specified in Section 104.

" Additional Amounts " has the meaning specified in Section 1005.

" Affiliate " of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, "control" when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing.

" Authenticating Agent " means any Person appointed by the Trustee to act on behalf of the Trustee pursuant to Section 611 to authenticate Securities.

" Authorized Newspaper " means a newspaper (which in the case of Canada, will, if practicable, be The Globe & Mail, in the case of The City of New York, will, if practicable, be The Wall Street Journal (Eastern Edition), in the case of the United Kingdom will, if practicable, be The Financial Times (London Edition) and, in the case of Luxembourg, will, if practicable, be The Luxembourg (Wort)), in the English language or in an official language of the country of publication, customarily published on each Business Day, whether or not published on Saturdays, Sundays or holidays, and of general circulation in Canada, The City of New York, the United Kingdom or Luxembourg, as applicable. Where successive publications are required to be made in Authorized Newspapers, the successive publications may be made in the same or in different newspapers in the same city meeting the foregoing requirements and in each case on any Business Day.

" Bearer Security " means any Security except a Registered Security.

" Board of Directors " means either the board of directors of the Company or any duly authorized committee of that board.

" Board Resolution " means a copy of a resolution certified by the Senior Vice President and General Counsel or the Vice President, Associate General Counsel and Secretary of the Company to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification, and delivered to the Trustee.

" Business Day ", when used with respect to any Place of Payment, Calgary, New York, London, Luxembourg or any other particular location referred to in this Indenture or in the Securities, means, unless otherwise specified with respect to any Securities pursuant to Section 301, each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in that Place of Payment, Calgary, New York, London, Luxembourg or other location are authorized or obligated by law or executive order to close.

" calculation period " has the meaning specified in Section 311.

" Canadian Taxes " has the meaning specified in Section 1005.

" Capital Lease Obligation " means the obligation of a Person, as lessee, to pay rent or other amounts to the lessor under a lease of real or personal property which is required to be classified and accounted for as a capital lease on a consolidated balance sheet of such person in accordance with GAAP.

" Clearstream " means Clearstream Banking, société anonyme, or its successor.

" Collateral Documents " means, in connection with the issuance under this Indenture pursuant to Section 301 of any series of Securities secured pursuant to Section 301 hereof, any agreement or agreements creating or relating to any security interest securing the due and punctual payment of all amounts at any time owing under such series of Securities.

" Commission " means the U.S. Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, or, if at any time after the execution of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.

" Common Depositary " has the meaning specified in Section 304.

" Company " means the Person named as the "Company" in the first paragraph of this Indenture until a successor Person shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Company" shall mean such successor Person.

" Company Request " or " Company Order " means a written request or order signed in the name of the Company by its President and Chief Executive Officer, its Chief Final Officer, its Vice President, Finance, its Senior Vice President and General Counsel, its Vice President, Associate General Counsel and Secretary or any Vice President and delivered to the Trustee.

" Consolidated Net Tangible Assets " means the total amount of assets of the Company on a consolidated basis (less applicable reserves) after deducting therefrom: (i) all current liabilities (excluding any current liabilities which are by their terms extendible or renewable at the option of the obligor thereon to a time more than 12 months after the time as of which the amount thereof is being computed); (ii) all goodwill, trade names, trademarks, patents, unamortized debt discount and expense and other similar intangibles; and (iii) appropriate adjustments on account of minority interests of other Persons holding stock of the Company's Subsidiaries; in each case as shown on the most recent annual audited or quarterly unaudited consolidated balance sheet of the Company and computed in accordance with GAAP.

" Component Currency " has the meaning specified in Section 312.

" Conversion Date " has the meaning specified in Section 312.

" Conversion Event " means the cessation of use of (i) a Foreign Currency (other than the Euro or other currency unit) both by the government of the country which issued such Currency and by a central bank or other public institution of or within the international banking community for the settlement of transactions, (ii) the Euro or (iii) any currency unit (or composite currency) other than the Euro for the purposes for which it was established.

" Corporate Trust Office " means the principal office of the Trustee at which at any time its corporate trust business shall be administered, which office at the date hereof is located at 101 Barclay Street, Floor 4 East, New York, New York 10286, Attention: Global Finance Americas Unit, facsimile: (212) 815-5390 or such other address as the Trustee may designate from time to time by notice to the Holders and the Company, or the principal corporate trust office of any successor Trustee (or such other address as such successor Trustee may designate from time to time by notice to the Holders and the Company).

" corporation " includes corporations, associations, companies and business trusts.

" coupon " means any interest coupon appertaining to a Bearer Security.

" covenant defeasance " has the meaning specified in Section 1403.

" Currency " means any currency or currencies, composite currency or currency unit or currency units, including, without limitation, the Euro, issued by the government of one or more countries or by any recognized confederation or association of such governments.

" Current Assets " means current assets as determined in accordance with GAAP.

" Debt " means as at the date of determination, all items of indebtedness in respect of any amounts borrowed which, in accordance with GAAP, would be recorded as debt in the consolidated financial statements of any person, including:

(i): any obligation for borrowed money;
(ii): any obligation evidenced by bonds, debentures, notes, or other similar instruments;
(iii): any Purchase Money Obligation;
(iv): any Capital Lease Obligation;
(v): any payment obligation under Financial Instrument Obligations; and
(vi): any guarantee of Debt of another person.

" Default " means any event which is, or after notice or passage of time or both would be, an Event of Default.

" Defaulted Interest " has the meaning specified in Section 307.

" defeasance " has the meaning specified in Section 1402.

" Depositary for Securities " means The Depository Trust Company, or any successor thereto, or any other Person designated pursuant to Section 301.

" Dollar " or " $ " means a dollar or other equivalent unit in such coin or currency of the United States as at the time shall be legal tender for the payment of public and private debts.

" Dollar Equivalent of the Currency Unit " has the meaning specified in Section 312.

" Dollar Equivalent of the Foreign Currency " has the meaning specified in Section 312.

" Election Date " has the meaning specified in Section 312.

" Equity Interest " of any Person means any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) corporate stock or other equity participations, including partnership interests, whether general or limited, of such Person.

" Euro " means the single currency of the participating member states from time to time of the European Union described in legislation of the European Counsel for the operation of a single unified European currency (whether known as the Euro or otherwise).

" Euroclear " means Morgan Guaranty Trust Company of New York, Brussels Office, or its successor as operator of the Euroclear System.

" Event of Default " has the meaning specified in Section 501.

" Exchange Date " has the meaning specified in Section 304.

" Exchange Rate Agent " means, with respect to Securities of or within any series, unless otherwise specified with respect to any Securities pursuant to Section 301, a New York Clearing House bank, designated pursuant to Section 301 or Section 313.

" Exchange Rate Officer's Certificate " means a tested telex or a certificate setting forth (i) the applicable Market Exchange Rate and (ii) the Dollar or Foreign Currency amounts of principal (and premium, if any) and interest, if any (on an aggregate basis and on the basis of a Security having the lowest denomination principal amount determined in accordance with Section 302 in the relevant Currency), payable with respect to a Security of any series on the basis of such Market Exchange Rate, sent (in the case of a telex) or signed (in the case of a certificate) by the Chief Financial Officer, the Vice President, Finance or any Vice President of the Company.

" Excluded Holder " has the meaning specified in Section 1005.

" Extension Notice " has the meaning specified in Section 308.

" Extension Period " has the meaning specified in Section 308.

" Final Maturity " has the meaning specified in Section 308.

" Financial Instrument Obligations " means obligations arising under:

(i): interest rate swap agreements, forward rate agreements, floor, cap or collar agreements, futures or options, insurance or other similar agreements or arrangements, or any combination thereof, entered into by a Person of which the subject matter is interest rates or pursuant to which the price, value or amount payable thereunder is dependent or based upon interest rates in effect from time to time or fluctuations in interest rates occurring from time to time;
(ii): currency swap agreements, cross-currency agreements, forward agreements, floor, cap or collar agreements, futures or options, insurance or other similar agreements or arrangements, or any combination thereof, entered into by a Person of which the subject matter is currency exchange rates or pursuant to which the price, value or amount payable thereunder is dependent or based upon currency exchange rates in effect from time to time or fluctuations in currency exchange rates occurring from time to time; and
(iii): commodity swap or hedging agreements, floor, cap or collar agreements, commodity futures or options or other similar agreements or arrangements, or any combination thereof, entered into by a Person of which the subject matter is one or more commodities or pursuant to which the price, value or amount payable thereunder is dependent or based upon the price of one or more commodities in effect from time to time or fluctuations in the price of one or more commodities occurring from time to time.

" First Currency " has the meaning specified in Section 115.

" Foreign Currency " means any Currency other than Currency of the United States.

" GAAP " means generally accepted accounting principles which such Person reports its financial statements in and which are in effect from time to time.

" Government Obligations " means, unless otherwise specified with respect to any series of Securities pursuant to Section 301, securities which are (i) direct obligations of the government which issued the Currency in which the Securities of a particular series are payable or (ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the government which issued the Currency in which the Securities of such series are payable, the payment of which is unconditionally guaranteed by such government, which, in either case, are full faith and credit obligations of such government payable in such Currency and are not callable or redeemable at the option of the issuer thereof and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such Government Obligation or a specific payment of interest on or principal of any such Government Obligation held by such custodian for the account of the holder of a depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Obligation or the specific payment of interest or principal of the Government Obligation evidenced by such depository receipt.

" Holder " means, in the case of a Registered Security, the Person in whose name a Security is registered in the Security Register and, in the case of a Bearer Security, the bearer thereof and, when used with respect to any coupon, shall mean the bearer thereof.

" Indenture " means this instrument as originally executed and as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof, and shall include the terms of particular series of Securities established as contemplated by Section 301; provided , however , that, if at any time more than one Person is acting as Trustee under this instrument, "Indenture" shall mean, with respect to any one or more series of Securities for which such Person is Trustee, this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof and shall include the terms of particular series of Securities for which such Person is Trustee established as contemplated by Section 301, exclusive, however, of any provisions or terms which relate solely to other series of Securities for which such Person is not Trustee, regardless of when such terms or provisions were adopted, and exclusive of any provisions or terms adopted by means of one or more indentures supplemental hereto executed and delivered after such Person had become such Trustee but to which such Person, as such Trustee, was not a party.

" Indexed Security " means a Security the terms of which provide that the principal amount thereof payable at Stated Maturity may be more or less than the principal face amount thereof at original issuance.

" interest ", when used with respect to an Original Issue Discount Security which by its terms bears interest only after Maturity, means interest payable after Maturity at the rate prescribed in such Original Issue Discount Security.

" Interest Payment Date ", when used with respect to any Security, means the Stated Maturity of an installment of interest on such Security.

" Judgment Currency " has the meaning specified in Section 114.

" Lien " means any security by way of an assignment, mortgage, charge, pledge, lien, encumbrance, title retention agreement or other security interest whatsoever, but not including any security interest in respect of a lease which is not a Capital Lease Obligation and provided that such term shall not include any encumbrance that may be deemed to arise solely as a result of entering into an agreement, not in violation of the terms of this Indenture, to sell or otherwise transfer assets or Property.

" mandatory sinking fund payment " has the meaning specified in Section 1201.

" Market Exchange Rate " means, unless otherwise specified with respect to any Securities pursuant to Section 301, (i) for any conversion involving a currency unit on the one hand and Dollars or any Foreign Currency on the other, the exchange rate between the relevant currency unit and Dollars or such Foreign Currency calculated by the method specified pursuant to Section 301 for the Securities of the relevant series, (ii) for any conversion of Dollars into any Foreign Currency, the noon (New York City time) buying rate for such Foreign Currency for cable transfers quoted in New York City as certified for customs purposes by the Federal Reserve Bank of New York and (iii) for any conversion of one Foreign Currency into Dollars or another Foreign Currency, the spot rate at noon local time in the relevant market at which, in accordance with normal banking procedures, the Dollars or Foreign Currency into which conversion is being made could be purchased with the Foreign Currency from which conversion is being made from major banks located in either New York City, London or any other principal market for Dollars or such purchased Foreign Currency, in each case determined by the Exchange Rate Agent. Unless otherwise specified with respect to any Securities pursuant to Section 301, in the event of the unavailability of any of the exchange rates provided for in the foregoing clauses (i), (ii) and (iii), the Exchange Rate Agent shall use, in its sole discretion and without liability on its part, such quotation of the Federal Reserve Bank of New York as of the most recent available date, or quotations from one or more major banks in New York City, London, England or another principal market for the Currency in question, or such other quotations as the Exchange Rate Agent shall deem appropriate. Unless otherwise specified by the Exchange Rate Agent, if there is more than one market for dealing in any Currency by reason of foreign exchange regulations or otherwise, the market to be used in respect of such Currency shall be that upon which a non-resident issuer of securities designated in such Currency would purchase such Currency in order to make payments in respect of such securities.

" Maturity ", when used with respect to any Security, means the date on which the principal of such Security or an installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, notice of redemption, notice of option to elect repayment or otherwise.

" Officers' Certificate " means a certificate signed by any two of the President and Chief Executive Officer, the Chief Financial Officer, the Vice President, Finance, the Senior Vice President and General Counsel, the Vice President, Associate General Counsel and Secretary or any Vice President of the Company, and delivered to the Trustee.

" Opinion of Counsel " means a written opinion of counsel, who may be counsel for the Company, including an employee of the Company.

" Optional Reset Date " has the meaning specified in Section 307.

" optional sinking fund payment " has the meaning specified in Section 1201.

" Original Issue Discount Security " means any Security which provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502.

" Original Stated Maturity " has the meaning specified in Section 308.

" Outstanding ", when used with respect to Securities, means, as of the date of determination, all Securities theretofore authenticated and delivered under this Indenture, except :

(i): Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation;
(ii): Securities, or portions thereof, for whose payment or redemption or repayment at the option of the Holder money in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Securities and any coupons appertaining thereto; provided that, if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made;
(iii): Securities, except to the extent provided in Sections 1402 and 1403, with respect to which the Company has effected defeasance and/or covenant defeasance as provided in Article Fourteen; and
(iv): Securities which have been paid pursuant to Section 306 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Securities are held by a protected purchaser (as defined in Article 8 of the UCC) in whose hands such Securities are valid obligations of the Company;

provided , however , that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder or are present at a meeting of Holders for quorum purposes, and for the purpose of making the calculations required by TIA Section 313, (i) the principal amount of an Original Issue Discount Security that may be counted in making such determination or calculation and that shall be deemed to be Outstanding for such purpose shall be equal to the amount of principal thereof that would be (or shall have been declared to be) due and payable, at the time of such determination, upon a declaration of acceleration of the maturity thereof pursuant to Section 502, (ii) the principal amount of any Security denominated in a Foreign Currency that may be counted in making such determination or calculation and that shall be deemed Outstanding for such purpose shall be equal to the Dollar equivalent, determined as of the date such Security is originally issued by the Company as set forth in an Exchange Rate Officers' Certificate delivered to the Trustee, of the principal amount (or, in the case of an Original Issue Discount Security, the Dollar equivalent as of such date of original issuance of the amount determined as provided in clause (i) above) of such Security, (iii) the principal amount of any Indexed Security that may be counted in making such determination or calculation and that shall be deemed outstanding for such purpose shall be equal to the principal face amount of such Indexed Security at original issuance, unless otherwise provided with respect to such Security pursuant to Section 301, and (iv) Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in making such calculation or in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Securities which a Responsible Officer of the Trustee knows to be so owned shall be so disregarded. Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee's right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or such other obligor.

" Paying Agent " means any Person (including the Company acting as Paying Agent) authorized by the Company to pay the principal of (or premium, if any) or interest, if any, on any Securities on behalf of the Company.

" Permitted Reorganization " has the meaning specified in Section 801.

" Permitted Reorganization Date" has the meaning specified in Section 801.

" Person " means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

" Place of Payment " means, when used with respect to the Securities of or within any series, the place or places where the principal of (and premium, if any) and interest, if any, on such Securities are payable as specified as contemplated by Sections 301 and 1002.

" Predecessor Security " of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under Section 306 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Security or a Security to which a mutilated, destroyed, lost or stolen coupon appertains shall be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen Security or the Security to which the mutilated, destroyed, lost or stolen coupon appertains, as the case may be.

" Property " means all property owned by the Company or a Restricted Subsidiary except such property which is determined by a resolution of the Company's Board of Directors delivered to the Trustee not to be property of material importance to the total business conducted by the Company and its Restricted Subsidiaries.

" Purchase Money Mortgage " means any Lien created, issued, incurred or assumed by the Company or a Restricted Subsidiary to secure a Purchase Money Obligation; provided that such Lien is limited to the Property (including the rights associated therewith) acquired, constructed, installed or improved in connection with such Purchase Money Obligation.

" Purchase Money Obligation " means Debt of the Company or a Restricted Subsidiary incurred or assumed to finance the purchase price, in whole or in part, of any Property or incurred to finance the cost, in whole or in part, of construction or installation of or improvements to any Property; provided, however, that such Debt is incurred or assumed within 180 days after the purchase of such Property or the completion of such construction, installation or improvements, as the case may be, provided that the principal amount of such Debt which is secured by the Lien does not exceed 100% of such purchase price or cost, as the case may be, and includes any extension, renewal or refunding of any such Debt provided the principal amount thereof outstanding on the date of such extension, renewal or refunding is not increased, and provided further that any such extension, renewal or refunding does not extend to any Property other than the Property in connection with which such obligation was created and improvements erected or constructed thereon.

" rate(s) of exchange " has the meaning specified in Section 114.

" Redemption Date ", when used with respect to any Security to be redeemed, in whole or in part, means the date fixed for such redemption by or pursuant to this Indenture.

" Redemption Price ", when used with respect to any Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture.

" Registered Security " means any Security registered in the Security Register.

" Regular Record Date " for the interest payable on any Interest Payment Date on the Registered Securities of or within any series means the date specified for that purpose as contemplated by Section 301.

" Repayment Date " means, when used with respect to any Security to be repaid at the option of the Holder, the date fixed for such repayment pursuant to this Indenture.

" Repayment Price " means, when used with respect to any Security to be repaid at the option of the Holder, the price at which it is to be repaid pursuant to this Indenture.

" Required Currency " has the meaning specified in Section 114.

" Reset Notice " has the meaning specified in Section 307.

" Responsible Officer ", when used with respect to the Trustee, means any vice president, any assistant treasurer, any trust officer or assistant trust officer, or any other officer of the Trustee customarily performing functions similar to those performed by any of the above-designated officers, and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject.

" Restricted Subsidiary " means a Subsidiary of the Company; provided , however , such term shall not include any Subsidiary of the Company if the amount of the Company's share of the shareholder's equity in such Subsidiary does not, at the time of determination, exceed 2% of Shareholders' Equity.

" Securities " has the meaning stated in the first recital of this Indenture and more particularly means any Securities authenticated and delivered under this Indenture; provided , however , that if at any time there is more than one Person acting as Trustee under this Indenture, "Securities" with respect to the Indenture as to which such Person is Trustee shall have the meaning stated in the first recital of this Indenture and shall more particularly mean Securities authenticated and delivered under this Indenture, exclusive, however, of Securities of any series as to which such Person is not Trustee.

" Security Register " and " Security Registrar " have the respective meanings specified in Section 305.

" Shareholders' Equity " means the aggregate amount of shareholders' equity (including but not limited to share capital, contributed surplus and retained earnings) of the Company as shown on the most recent annual audited or quarterly unaudited consolidated balance sheet of the Company and computed in accordance with GAAP.

" Special Record Date " for the payment of any Defaulted Interest on the Registered Securities of or within any series means a date fixed by the Trustee pursuant to Section 307.

" Specified Amount " has the meaning specified in Section 312.

" Stated Maturity ", when used with respect to any Security or any installment of principal thereof or interest thereon, means the date specified in such Security or a coupon representing such installment of interest as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable, as such date may be extended pursuant to the provisions of Section 308.

" Subsidiary " of any person means, at the date of determination, any corporation or other person of which Voting Shares or other interests carrying more than 50% of the voting rights attached to all outstanding Voting Shares or other interests are owned, directly or indirectly, by or for such person or one or more Subsidiaries thereof.

" Subsequent Interest Period " has the meaning specified in Section 307.

" Trust Indenture Act " or " TIA " means the Trust Indenture Act of 1939 as in force at the date as of which this Indenture was executed, except as provided in Section 905.

" Trustee " means the Person named as the "Trustee" in the first paragraph of this Indenture until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Trustee" shall mean or include each Person who is then a Trustee hereunder; provided , however , that if at any time there is more than one such Person, "Trustee" as used with respect to the Securities of any series shall mean only the Trustee with respect to Securities of that series.

" United States " means, unless otherwise specified with respect to any Securities pursuant to Section 301, the United States of America (including the states and the District of Columbia), its territories, its possessions and other areas subject to its jurisdiction.

" United States person " means, unless otherwise specified with respect to any Securities pursuant to Section 301, an individual who is a citizen or resident of the United States, a corporation, partnership or other entity created or organized in or under the laws of the United States or an estate or trust the income of which is subject to United States federal income taxation regardless of its source.

" Valuation Date " has the meaning specified in Section 312(c).

" Vice President ", when used with respect to the Company or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title "vice president".

" Voting Shares " means shares of any class of a corporation having under all circumstances the right to vote for the election of the directors of such corporation, provided that, for the purpose of this definition, shares which only carry the right to vote conditionally on the happening of an event shall not be considered Voting Shares whether or not such event shall have happened.

" Wholly Owned Subsidiary " means a Subsidiary of which all the Equity Interests are owned by the Company or another Wholly Owned Subsidiary of the Company, other than directors' qualifying shares.

" Yield to Maturity " means the yield to maturity, computed at the time of issuance of a Security (or, if applicable, at the most recent redetermination of interest on such Security) and as set forth in such Security in accordance with generally accepted United States bond yield computation principles.

SECTION 102. Compliance Certificates and Opinions.

Upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee, to the extent required by the Trust Indenture Act, an Officers' Certificate stating that all conditions precedent, if any, provided for in this Indenture (including any covenant compliance with which constitutes a condition precedent) relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.

Every certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture (other than pursuant to Section 1004) shall include:

(1) a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;

(2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(3) a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

(4) a statement as to whether, in the opinion of each such individual, such covenant or condition has been complied with.

SECTION 103. Form of Documents Delivered to Trustee.

In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.

Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous.

Any certificate or opinion of an officer of the Company or of counsel may be based, insofar as it relates to accounting matters, upon a certificate or opinion of, or representations by, an accountant or firm of accountants in the employ of the Company, unless such officer or counsel, as the case may be, knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the accounting matters upon which such certificate or opinion may be based are erroneous. Any certificate or opinion of any independent firm of public accountants filed with the Trustees shall contain a statement that such firm is independent.

Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.

SECTION 104. Acts of Holders.

(a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders of the Outstanding Securities of all series or one or more series, as the case may be, may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by agents duly appointed in writing. If Securities of a series are issuable as Bearer Securities, any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders of such series may, alternatively, be embodied in and evidenced by the record of Holders of Securities of such series voting in favor thereof, either in person or by proxies duly appointed in writing, at any meeting of Holders of Securities of such series duly called and held in accordance with the provisions of Article Fifteen, or a combination of such instruments and any such record. Except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments or record or both are delivered to the Trustee and, where it is hereby expressly required, to the Company. Such instrument or instruments and any such record (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "Act" of the Holders signing such instrument or instruments or so voting at any such meeting. Proof of execution of any such instrument or of a writing appointing any such agent, or of the holding by any Person of a Security, shall be sufficient for any purpose of this Indenture and conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section. The record of any meeting of Holders of Securities shall be proved in the manner provided in Section 1506.

(b) The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof. Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient.

(c) The principal amount and serial numbers of Registered Securities held by any Person, and the date of holding the same, shall be proved by the Security Register.

(d) The principal amount and serial numbers of Bearer Securities held by any Person, and the date of holding the same, may be proved by the production of such Bearer Securities or by a certificate executed, as depositary, by any trust company, bank, banker or other depositary, wherever situated, if such certificate shall be deemed by the Trustee to be satisfactory, showing that at the date therein mentioned such Person had on deposit with such depositary, or exhibited to it, the Bearer Securities therein described; or such facts may be proved by the certificate or affidavit of the Person holding such Bearer Securities, if such certificate or affidavit is deemed by the Trustee to be satisfactory. The Trustee and the Company may assume that such ownership of any Bearer Security continues until (1) another certificate or affidavit bearing a later date issued in respect of the same Bearer Security is produced, or (2) such Bearer Security is produced to the Trustee by some other Person, or (3) such Bearer Security is surrendered in exchange for a Registered Security, or (4) such Bearer Security is no longer Outstanding. The principal amount and serial numbers of Bearer Securities held by any Person, and the date of holding the same, may also be proved in any other manner that the Trustee deems sufficient.

(e) If the Company shall solicit from the Holders of Registered Securities any request, demand, authorization, direction, notice, consent, waiver or other Act, the Company may, at its option, by or pursuant to a Board Resolution, fix in advance a record date for the determination of Holders entitled to give such request, demand, authorization, direction, notice, consent, waiver or other Act, but the Company shall have no obligation to do so. Notwithstanding TIA Section 316(c), such record date shall be the record date specified in or pursuant to such Board Resolution, which shall be a date not earlier than the date 30 days prior to the first solicitation of Holders generally in connection therewith and not later than the date such solicitation is completed. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other Act may be given before or after such record date, but only the Holders of record at the close of business on such record date shall be deemed to be Holders for the purposes of determining whether Holders of the requisite proportion of Outstanding Securities have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other Act, and for that purpose the Outstanding Securities shall be computed as of such record date; provided that no such authorization, agreement or consent by the Holders on such record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than eleven months after the record date.

(f) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Security shall bind every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action is made upon such Security.

SECTION 105. Notices, etc. to Trustee and Company.

Any request, demand, authorization, direction, notice, consent, waiver or Act of Holders or other documents provided or permitted by this Indenture to be made upon, given or furnished to, or filed with,

(1) the Trustee by any Holder or by the Company shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the Trustee at its Corporate Trust Office, Attention: Global Finance Americas Unit, or

(2) the Company by the Trustee or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to the Company, facsimile: (403) 269-6200, Attention: Senior Vice President and General Counsel, addressed to it at the address of its principal office specified in the first paragraph of this Indenture or at any other address previously furnished in writing to the Trustee by the Company.

SECTION 106. Notice to Holders; Waiver.

Where this Indenture provides for notice of any event to Holders of Registered Securities by the Company or the Trustee, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each such Holder affected by such event, at his address as it appears in the Security Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Holders of Registered Securities is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders of Registered Securities or the sufficiency of any notice to Holders of Bearer Securities given as provided. Any notice mailed to a Holder in the manner herein prescribed shall be conclusively deemed to have been received by such Holder, whether or not such Holder actually receives such notice.

In case, by reason of the suspension of or irregularities in regular mail service or by reason of any other cause, it shall be impractical to mail notice of any event to Holders of Registered Securities when such notice is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be satisfactory to the Trustee shall be deemed to be sufficient giving of such notice for every purpose hereunder.

Except as otherwise expressly provided herein or otherwise specified with respect to any Securities pursuant to Section 301, where this Indenture provides for notice to Holders of Bearer Securities of any event, such notice shall be sufficiently given to Holders of Bearer Securities if published in an Authorized Newspaper in The City of New York and in such other city or cities as may be specified in such Securities on a Business Day at least twice, the first such publication to be not earlier than the earliest date, and not later than the latest date, prescribed for the giving of such notice. Any such notice shall be deemed to have been given on the date of the first such publication.

In case, by reason of the suspension of publication of any Authorized Newspaper or Authorized Newspapers or by reason of any other cause, it shall be impracticable to publish any notice to Holders of Bearer Securities as provided above, then such notification to Holders of Bearer Securities as shall be given with the approval of the Trustee shall constitute sufficient notice to such Holders for every purpose hereunder. Neither the failure to give notice by publication to Holders of Bearer Securities as provided above, nor any defect in any notice so published, shall affect the sufficiency of such notice with respect to other Holders of Bearer Securities or the sufficiency of any notice to Holders of Registered Securities given as provided herein.

Any request, demand, authorization, direction, notice, consent or waiver required or permitted under this Indenture shall be in the English language, except that any published notice may be in an official language of the country of publication.

Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

SECTION 107. Effect of Headings and Table of Contents.

The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.

SECTION 108. Successors and Assigns.

All covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so expressed or not.

SECTION 109. Separability Clause.

In case any provision in this Indenture or in any Security or coupon shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 110. Benefits of Indenture.

Nothing in this Indenture or in the Securities or coupons, express or implied, shall give to any Person, other than the parties hereto, any Authenticating Agent, any Paying Agent, any Securities Registrar and their successors hereunder and the Holders of Securities or coupons, any benefit or any legal or equitable right, remedy or claim under this Indenture.

SECTION 111. Governing Law.

This Indenture and the Securities and coupons shall be governed by and construed in accordance with the law of the State of New York without regard to principles of conflicts of laws. This Indenture is subject to the provisions of the Trust Indenture Act that are required to be part of this Indenture and shall, to the extent applicable, be governed by such provisions.

SECTION 112. Legal Holidays.

In any case where any Interest Payment Date, Redemption Date, sinking fund payment date or Stated Maturity or Maturity of any Security shall not be a Business Day at any Place of Payment, then (notwithstanding any other provision of this Indenture or of any Security or coupon other than a provision in the Securities of any series which specifically states that such provision shall apply in lieu of this Section), payment of principal (or premium, if any) or interest, if any, need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date or Redemption Date or sinking fund payment date, or at the Stated Maturity or Maturity; provided that no interest shall accrue for the period from and after such Interest Payment Date, Redemption Date, sinking fund payment date, Stated Maturity or Maturity, as the case may be.

SECTION 113. Agent for Service; Submission to Jurisdiction; Waiver of Immunities.

By the execution and delivery of this Indenture, the Company (i) acknowledges that it has irrevocably designated and appointed CT Corporation System, 111 8 ^th Avenue, 13 ^th Floor, New York, New York, 10011 as its authorized agent upon which process may be served in any suit or proceeding arising out of or relating to the Securities or this Indenture that may be instituted in any United States federal or New York State court in the Borough of Manhattan in the City of New York or brought under federal or state securities laws or brought by the Trustee (whether in its individual capacity or in its capacity as Trustee hereunder), (ii) submits to the non-exclusive jurisdiction of any such court in any such suit or proceeding, and (iii) agrees that service of process upon CT Corporation System and written notice of said service to the Company (mailed or delivered to the Company, attention: Senior Vice President and General Counsel, at its principal office specified in the first paragraph of this Indenture and in the manner specified in Section 105 hereof), shall be deemed in every respect effective service of process upon the Company in any such suit or proceeding. The Company further agrees to take any and all action, including the execution and filing of any and all such documents and instruments, as may be necessary to continue such designation and appointment of CT Corporation System in full force and effect so long as any of the Securities shall be outstanding.

To the extent that the Company has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service of notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property, the Company hereby irrevocably waives such immunity in respect of its obligations under this Indenture and the Securities, to the extent permitted by law.

The Company hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Indenture or the Securities in any federal or state court in the State of New York, Borough of Manhattan. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

SECTION 114. Conversion of Currency.

(a) The Company covenants and agrees that the following provisions shall apply to conversion of currency in the case of the Securities and this Indenture:

(i) If for the purposes of obtaining judgment in, or enforcing the judgment of, any court in any country, it becomes necessary to convert into any other currency (the " Judgment Currency ") an amount due or contingently due under the Securities of any series and this Indenture (the " Required Currency "), then the conversion shall be made at the rate of exchange prevailing on the Business Day before the day on which a final judgment which is not appealable or is not appealed is given or the order of enforcement is made, as the case may be (unless a court shall otherwise determine).

(ii) If there is a change in the rate of exchange prevailing between the Business Day before the day on which the judgment referred to in (i) above is given or an order of enforcement is made, as the case may be (or such other date as a court shall determine), and the date of receipt of the amount due, the Company shall pay such additional (or, as the case may be, such lesser) amount, if any, as may be necessary so that the amount paid in the Judgment Currency when converted at the rate of exchange prevailing on the date of receipt will produce the amount in the Required Currency originally due.

(b) In the event of the winding-up of the Company at any time while any amount or damages owing under the Securities and this Indenture, or any judgment or order rendered in respect thereof, shall remain outstanding, the Company shall indemnify and hold the Holders and the Trustee harmless against any deficiency arising or resulting from any variation in rates of exchange between (1) the date as of which the equivalent of the amount in the Required Currency (other than under this Subsection (b)) is calculated for the purposes of such winding-up and (2) the final date for the filing of proofs of claim in such winding-up. For the purpose of this Subsection (b) the final date for the filing of proofs of claim in the winding-up of the Company shall be the date fixed by the liquidator or otherwise in accordance with the relevant provisions of applicable law as being the latest practicable date as at which liabilities of the Company may be ascertained for such winding-up prior to payment by the liquidator or otherwise in respect thereto.

(c) The obligations contained in Subsections (a)(ii) and (b) of this Section shall constitute separate and independent obligations of the Company from its other obligations under the Securities and this Indenture, shall give rise to separate and independent causes of action against the Company, shall apply irrespective of any waiver or extension granted by any Holder or Trustee from time to time and shall continue in full force and effect notwithstanding any judgment or order or the filing of any proof of claim in the winding-up of the Company for a liquidated sum in respect of amounts due hereunder (other than under Subsection (b) above) or under any such judgment or order. Any such deficiency as aforesaid shall be deemed to constitute a loss suffered by the Holders or the Trustee, as the case may be, and no proof or evidence of any actual loss shall be required by the Company or the applicable liquidator. In the case of Subsection (b) above, the amount of such deficiency shall not be deemed to be reduced by any variation in rates of exchange occurring between the said final date and the date of any liquidating distribution.

(d) The term " rate(s) of exchange " shall mean the Bank of Canada noon rate for purchases on the relevant date of the Required Currency with the Judgment Currency, as reported by Telerate on screen 3194 (or such other means of reporting the Bank of Canada noon rate as may be agreed upon by each of the parties to this Indenture) and includes any premiums and costs of exchange payable.

SECTION 115. Currency Equivalent.

Except as otherwise provided in this Indenture, for purposes of the construction of the terms of this Indenture or of the Securities, in the event that any amount is stated herein in the Currency of one nation (the " First Currency "), as of any date such amount shall also be deemed to represent the amount in the Currency of any other relevant nation which is required to purchase such amount in the First Currency at the Bank of Canada noon rate as reported by Telerate on screen 3194 (or such other means of reporting the Bank of Canada noon rate as may be agreed upon by each of the parties to this Indenture) on the date of determination.

SECTION 116. Conflict with Trust Indenture Act.

If and to the extent that any provision hereof limits, qualifies or conflicts with the duties imposed by any of Sections 310 to 318, inclusive, of the Trust Indenture Act, through operation of Section 318(c) thereof, such imposed duties shall control.

SECTION 117. Incorporators, Shareholders, Officers and Directors of the Company Exempt from Individual Liability.

No recourse under or upon any obligation, covenant or agreement contained in this Indenture, or in any Security, or because of any indebtedness evidenced thereby, shall be had against any incorporator, as such, or against any past, present or future shareholder, officer or director, as such, of the Company or of any successor, either directly or through the Company or any successor, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of the Securities by the Holders and as part of the consideration for the issue of the Securities.

SECTION 118. Security Interest.

Where a series of Securities are secured by collateral pursuant to Section 301 hereof, then to secure the due and punctual payment of all amounts at any time owing under such series of Securities when and as the same shall be due and payable, whether on a regularly scheduled payment date, at maturity, by acceleration, redemption or otherwise, and the performance of all other obligations of the Company to the Holders or the Trustee, the Company shall cause appropriate Collateral Documents to be executed and delivered concurrently with the issuance of such series of Securities. Where Collateral Documents are executed and delivered concurrently with the issuance of a series of Securities, the Securities of each series, or the supplemental indenture relating to such series, shall provide that a breach of the Collateral Documents shall constitute a Default, and after passage of time, an Event of Default, under the Indenture.

Each Holder, by its acceptance of such series of Securities, consents and agrees to the terms of each Collateral Document, as the same may be in effect or may be amended from time to time in accordance with their terms, and authorizes and directs the Trustee to enter into any Collateral Document and to perform its obligations and to do or cause to be done all such actions and things to assure and confirm to the Trustee the security interests contemplated by the Collateral Documents, as from time to time constituted, so as to render the same available for the benefit of the Holders of such series of Securities secured thereby.

ARTICLE TWO

SECURITIES FORMS

SECTION 201. Forms Generally.

The Registered Securities, if any, of each series and the Bearer Securities, if any, of each series and related coupons shall be in substantially the forms as shall be established by or pursuant to a Board Resolution or in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may, consistently herewith, be determined by the officers executing such Securities or coupons, as evidenced by their execution of the Securities or coupons. If the forms of Securities or coupons of any series are established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action shall be certified by the Senior Vice President and General Counsel or the Vice President, Associate General Counsel and Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Company Order contemplated by Section 303 for the authentication and delivery of such Securities or coupons. Any portion of the text of any Security may be set forth on the reverse thereof, with an appropriate reference thereto on the face of the Security.

Unless otherwise specified as contemplated by Section 301, Securities in bearer form shall have interest coupons attached.

The Trustee's certificate of authentication on all Securities shall be in substantially the form set forth in this Article.

The definitive Securities and coupons shall be printed, lithographed or engraved on steel-engraved borders or may be produced in any other manner, all as determined by the officers of the Company executing such Securities, as evidenced by their execution of such Securities or coupons.

SECTION 202. Form of Trustee's Certificate of Authentication.

Subject to Section 611, the Trustee's certificate of authentication shall be in substantially the following form:

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

Dated:

This is one of the Securities of the series designated therein referred to in, and issued under, the within-mentioned Indenture.

		THE BANK OF NEW YORK, as Trustee
		By	Authorized Signatory

SECTION 203. Securities Issuable in Global Form.

If Securities of or within a series are issuable in global form, as specified or as contemplated by Section 301, then, notwithstanding clause (8) of Section 301, any such Security shall represent such of the Outstanding Securities of such series as shall be specified therein and may provide that it shall represent the aggregate amount of Outstanding Securities of such series from time to time endorsed thereon and that the aggregate amount of Outstanding Securities of such series represented thereby may from time to time be increased or decreased to reflect exchanges. Any endorsement of a Security in global form to reflect the amount, or any increase or decrease in the amount, of Outstanding Securities represented thereby shall be made by the Trustee in such manner and upon instructions given by such Person or Persons as shall be specified therein or in the Company Order to be delivered to the Trustee pursuant to Section 303 or Section 304. Subject to the provisions of Section 303 and, if applicable, Section 304, the Trustee shall deliver and redeliver any Security in permanent global form in the manner and upon instructions given by the Person or Persons specified therein or in the applicable Company Order. If a Company Order pursuant to Section 303 or Section 304 has been, or simultaneously is, delivered, any instructions by the Company with respect to endorsement or delivery or redelivery of a Security in global form shall be in writing but need not comply with Section 102 and need not be accompanied by an Opinion of Counsel.

The provisions of the last sentence of Section 303 shall apply to any Security represented by a Security in global form if such Security was never issued and sold by the Company and the Company delivers to the Trustee the Security in global form together with written instructions (which need not comply with Section 102 and need not be accompanied by an Opinion of Counsel) with regard to the reduction in the principal amount of Securities represented thereby, together with the written statement contemplated by the last sentence of Section 303.

Notwithstanding the provisions of Section 307, unless otherwise specified as contemplated by Section 301, payment of principal of (and premium, if any) and interest, if any, on any Security in permanent global form shall be made to the Person or Persons specified therein.

Notwithstanding the provisions of Section 309 and except as provided in the preceding paragraph, the Company, the Trustee and any agent of the Company and the Trustee shall treat as the Holder of such principal amount of Outstanding Securities represented by a permanent global Security (i) in the case of a permanent global Security in registered form, the Holder of such permanent global Security in registered form, or (ii) in the case of a permanent global Security in bearer form, Euroclear or Clearstream.

ARTICLE THREE

THE SECURITIES

SECTION 301. Amount Unlimited; Issuable in Series.

The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited.

The Securities may be issued in one or more series. There shall be established in one or more Board Resolutions or pursuant to authority granted by one or more Board Resolutions and, subject to Section 303, set forth in, or determined in the manner provided in, an Officers' Certificate, or established in one or more indentures supplemental hereto, prior to the issuance of Securities of any series, any or all of the following, as applicable (each of which (except for the matters set forth in clauses (1), (2) and (17) below), if so provided, may be determined from time to time by the Company with respect to unissued Securities of the series and set forth in such Securities of the series when issued from time to time):

(1) the title of the Securities of the series (which shall distinguish the Securities of the series from all other series of Securities);

(2) any limit upon the aggregate principal amount of the Securities of the series that may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Section 304, 305, 306, 906, 1107 or 1305);

(3) the date or dates, or the method by which such date or dates will be determined or extended, on which the principal of the Securities of the series is payable;

(4) the rate or rates (whether fixed or variable) at which the Securities of the series shall bear interest, if any, or the method by which such rate or rates shall be determined, the date or dates from which such interest shall accrue, or the method by which such date or dates shall be determined, the Interest Payment Dates on which such interest shall be payable and the Regular Record Date, if any, for the interest payable on any Registered Security on any Interest Payment Date, or the method by which such date or dates shall be determined, whether and under what circumstances Additional Amounts on such Securities or any of them shall be payable, the notice, if any, to Holders regarding the determination of interest on a floating rate Security and the manner of giving such notice, and the basis upon which interest shall be calculated if other than on the basis of a 360-day year of twelve 30-day months;

(5) the place or places, if any, other than or in addition to the Borough of Manhattan, The City of New York, where the principal of (and premium, if any) and interest, if any, on Securities of the series shall be payable, where any Registered Securities of the series may be surrendered for registration of transfer, where Securities of the series may be surrendered for exchange, where Securities of the series that are convertible or exchangeable may be surrendered for conversion or exchange, as applicable and, if different from the location specified in Section 105, the place or places where notices or demands to or upon the Company in respect of the Securities of the series and this Indenture may be served, the extent to which, or the manners in which, any interest payment or Additional Amounts on a global Security on an Interest Payment Date, will be paid and the manner in which any principal of or premium, if any, on any global Security will be paid;

(6) the period or periods within which, the price or prices at which, the Currency in which, and other terms and conditions upon which Securities of the series may be redeemed, in whole or in part, at the option of the Company, if the Company is to have that option;

(7) the obligation, if any, of the Company to redeem, repay or purchase Securities of the series pursuant to any sinking fund or analogous provision or at the option of a Holder thereof, and the period or periods within which, the price or prices at which, the Currency in which, and other terms and conditions upon which Securities of the series shall be redeemed, repaid or purchased, in whole or in part, pursuant to such obligation;

(8) if other than denominations of $1,000 and any integral multiple thereof, the denomination or denominations in which any Registered Securities of the series shall be issuable and, if other than denominations of $5,000, the denomination or denominations in which any Bearer Securities of the series shall be issuable;

(9) if other than the Trustee, the identity of each Security Registrar and/or Paying Agent;

(10) if other than the principal amount thereof, the portion of the principal amount of Securities of the series that shall be payable upon declaration of acceleration of the Maturity thereof pursuant to Section 502 or the method by which such portion shall be determined;

(11) if other than Dollars, the Currency in which payment of the principal of (or premium, if any) or interest, if any, on the Securities of the series shall be payable or in which the Securities of the series shall be denominated and the particular provisions applicable thereto in accordance with, in addition to or in lieu of any of the provisions of Section 312;

(12) whether the amount of payments of principal of (or premium, if any) or interest, if any, on the Securities of the series may be determined with reference to an index, formula or other method (which index, formula or method may be based, without limitation, on one or more Currencies, commodities, equity indices or other indices), and the manner in which such amounts shall be determined;

(13) whether the principal of (or premium, if any) or interest, if any, on the Securities of the series are to be payable, at the election of the Company or a Holder thereof, in a Currency other than that in which such Securities are denominated or stated to be payable, the period or periods within which (including the Election Date), and the terms and conditions upon which, such election may be made, and the time and manner of determining the exchange rate between the Currency in which such Securities are denominated or stated to be payable and the Currency in which such Securities are to be so payable, in each case in accordance with, in addition to or in lieu of any of the provisions of Section 312;

(14) the designation of the initial Exchange Rate Agent, if any;

(15) the applicability, if any, of Sections 1402 and/or 1403 to the Securities of the series and any provisions in modification of, in addition to or in lieu of any of the provisions of Article Fourteen that shall be applicable to the Securities of the series;

(16) provisions, if any, granting special rights to the Holders of Securities of the series upon the occurrence of such events as may be specified;

(17) any deletions from, modifications of or additions to the Events of Default or covenants (including any deletions from, modifications of or additions to Section 1010) of the Company with respect to Securities of the series, whether or not such Events of Default or covenants are consistent with the Events of Default or covenants set forth herein;

(18) whether Securities of the series are to be issuable as Registered Securities, Bearer Securities (with or without coupons) or both, any restrictions applicable to the offer, sale or delivery of Bearer Securities, whether any Securities of the series are to be issuable initially in temporary global form and whether any Securities of the series are to be issuable in permanent global form with or without coupons and, if so, whether beneficial owners of interests in any such permanent global Security may exchange such interests for Securities of such series and of like tenor of any authorized form and denomination and the circumstances under which any such exchanges may occur, if other than in the manner provided in Section 305, whether Registered Securities of the series may be exchanged for Bearer Securities of the series (if permitted by applicable laws and regulations), whether Bearer Securities of the series may be exchanged for Registered Securities of such series, and the circumstances under which and the place or places where any such exchanges may be made and if Securities of the series are to be issuable in global form, the identity of any initial depository therefor;

(19) the date as of which any Bearer Securities of the series and any temporary global Security representing Outstanding Securities of the series shall be dated if other than the date of original issuance of the first Security of the series to be issued;

(20) the Person to whom any interest on any Registered Security of the series shall be payable, if other than the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, the manner in which, or the Person to whom, any interest on any Bearer Security of the series shall be payable, if otherwise than upon presentation and surrender of the coupons appertaining thereto as they severally mature, and the extent to which, or the manner in which, any interest payable on a temporary global Security on an Interest Payment Date will be paid if other than in the manner provided in Section 304;

(21) if Securities of the series are to be issuable in definitive form (whether upon original issue or upon exchange of a temporary Security of such series) only upon receipt of certain certificates or other documents or satisfaction of other conditions, the form and/or terms of such certificates, documents or conditions;

(22) if the Securities of the series are to be issued upon the exercise of warrants, the time, manner and place for such Securities to be authenticated and delivered;

(23) whether, under what circumstances and the Currency in which the Company will pay Additional Amounts as contemplated by Section 1005 on the Securities of the series to any Holder who is not a United States person (including any modification to the definition of such term) in respect of any tax, assessment or governmental charge and, if so, whether the Company will have the option to redeem such Securities rather than pay such Additional Amounts (and the terms of any such option);

(24) if the Securities of the series are to be convertible into or exchangeable for any securities of any Person (including the Company), the terms and conditions upon which such Securities will be so convertible or exchangeable;

(25) if payment of the Securities of the series will be guaranteed by any other Person;

(26) whether the Securities of the series will have the benefit of any Lien created under the Collateral Documents;

(27) the extent and manner, if any, in which payment on or in respect of the Securities of the series will be senior or will be subordinated to the prior payment of other liabilities and obligations of the Company;

(28) if other than The Depository Trust Company, the Person designated as the Depositary with respect to the Securities of such series;

(29) the percentage or percentages of principal amount at which the Securities of the series will be issued;

(30) any applicable Canadian and U.S. federal income tax consequences; and

(31) any other terms, conditions, rights and preferences (or limitations on such rights and preferences) relating to the series (which terms shall not be inconsistent with the requirements of the Trust Indenture Act or the provisions of this Indenture).

All Securities of any one series and the coupons appertaining to any Bearer Securities of such series shall be substantially identical except, in the case of Registered Securities, as to denomination and except as may otherwise be provided in or pursuant to such Board Resolution (subject to Section 303) and set forth in such Officers' Certificate or in any such indenture supplemental hereto. Not all Securities of any one series need be issued at the same time, and, unless otherwise provided, a series may be reopened for issuances of additional Securities of such series.

If any of the terms of the series are established by action taken pursuant to one or more Board Resolutions, such Board Resolutions shall be delivered to the Trustee at or prior to the delivery of the Officers' Certificate setting forth the terms of the series.

SECTION 302. Denominations.

The Securities of each series shall be issuable in such denominations as shall be specified as contemplated by Section 301. With respect to Securities of any series denominated in Dollars, in the absence of any such provisions, the Registered Securities of such series, other than Registered Securities issued in global form (which may be of any denomination), shall be issuable in denominations of $1,000 and any integral multiple thereof and the Bearer Securities of such series, other than the Bearer Securities issued in global form (which may be of any denomination), shall be issuable in a denomination of $5,000.

SECTION 303. Execution, Authentication, Delivery and Dating.

The Securities and any coupons appertaining thereto shall be executed on behalf of the Company by its President and Chief Executive Officer or its Chief Financial Officer, together with any one of the Senior Vice President and General Counsel, the Vice President, Associate General Counsel and Secretary, the Vice President, Finance or any Vice President, attested by its Senior Vice President and General Counsel or its Vice President, Associate General Counsel and Secretary. The signature of any of these officers on the Securities or coupons may be the manual or facsimile signatures of the present or any future such authorized officer and may be imprinted or otherwise reproduced on the Securities.

Securities or coupons bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities or coupons.

At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series together with any coupon appertaining thereto, executed by the Company to the Trustee for authentication, together with a Company Order for the authentication and delivery of such Securities, and the Trustee in accordance with such Company Order shall authenticate and deliver such Securities; provided , however , that, in connection with its original issuance, no Bearer Security shall be mailed or otherwise delivered to any location in the United States; and provided further that, unless otherwise specified with respect to any series of Securities pursuant to Section 301, a Bearer Security may be delivered in connection with its original issuance only if the Person entitled to receive such Bearer Security shall have furnished a certificate in the form set forth in this Indenture, dated no earlier than 15 days prior to the earlier of the date on which such Bearer Security is delivered and the date on which any temporary Security first becomes exchangeable for such Bearer Security in accordance with the terms of such temporary Security and this Indenture. If any Security shall be represented by a permanent global Bearer Security, then, for purposes of this Section and Section 304, the notation of a beneficial owner's interest therein upon original issuance of such Security or upon exchange of a portion of a temporary global Security shall be deemed to be delivery in connection with its original issuance of such beneficial owner's interest in such permanent global Security. Except as permitted by Section 306, the Trustee shall not authenticate and deliver any Bearer Security unless all appurtenant coupons for interest then matured have been detached and cancelled. If not all of the Securities of any series are to be issued at one time and if the Board Resolution or supplemental indenture establishing such series shall so permit, such Company Order may set forth procedures acceptable to the Trustee for the issuance of such Securities and determining terms of particular Securities of such series such as interest rate, stated maturity, date of issuance and date from which interest shall accrue.

In authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, and (subject to TIA Sections 315(a) through 315(d)) shall be fully protected in relying upon, an Opinion of Counsel stating:

(a) that the form or forms of such Securities and any coupons have been established in conformity with the provisions of this Indenture;

(b) that the terms of such Securities and any coupons have been established in conformity with the provisions of this Indenture;

(c) that such Securities, together with any coupons appertaining thereto, when completed by appropriate insertions and executed and delivered by the Company to the Trustee for authentication in accordance with this Indenture, authenticated and delivered by the Trustee in accordance with this Indenture and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute the legal, valid and binding obligations of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization and other similar laws of general applicability relating to or affecting the enforcement of creditors' rights, to general equitable principles and to such other qualifications as such counsel shall conclude do not materially affect the rights of Holders of such Securities and any coupons;

(d) that all laws and requirements in respect of the execution and delivery by the Company of such Securities, any coupons and the supplemental indentures, if any, have been complied with and that authentication and delivery of such Securities and any coupons and the execution and delivery of the supplemental indentures, if any, by the Trustee will not violate the terms of the Indenture;

(e) that the Company has the corporate power to issue such Securities and any coupons, and has duly taken all necessary corporate action with respect to such issuance; and

(f) that the issuance of such Securities and any coupons will not contravene the articles of incorporation or by-laws of the Company or result in any violation of any of the terms or provisions of any law or regulation or of any indenture, mortgage or other agreement known to such Counsel by which the Company is bound.

Notwithstanding the provisions of Section 301 and of the preceding two paragraphs, if not all the Securities of any series are to be issued at one time, it shall not be necessary to deliver the Officers' Certificate otherwise required pursuant to Section 301 or the Company Order and Opinion of Counsel otherwise required pursuant to the preceding two paragraphs prior to or at the time of issuance of each Security, but such documents shall be delivered prior to or at the time of issuance of the first Security of such series.

The Trustee shall not be required to authenticate and deliver any such Securities if the issue of such Securities pursuant to this Indenture will affect the Trustee's own rights, duties or immunities under the Securities and this Indenture or otherwise in a manner which is not reasonably acceptable to the Trustee.

Each Registered Security shall be dated the date of its authentication and each Bearer Security shall be dated as of the date specified as contemplated by Section 301.

No Security or coupon shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication substantially in the form provided for herein duly executed by the Trustee by manual signature of an authorized officer, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder and is entitled to the benefits of this Indenture. Notwithstanding the foregoing, if any Security shall have been authenticated and delivered hereunder but never issued and sold by the Company, and the Company shall deliver such Security to the Trustee for cancellation as provided in Section 310 together with a written statement (which need not comply with Section 102 and need not be accompanied by an Opinion of Counsel) stating that such Security has never been issued and sold by the Company, for all purposes of this Indenture such Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the benefits of this Indenture.

SECTION 304. Temporary Securities.

Pending the preparation of definitive Securities of any series, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Securities which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued, in registered form or, if authorized, in bearer form with one or more coupons or without coupons, and with such appropriate insertions, omissions, substitutions and other variations as conclusively the officers executing such Securities may determine, as conclusively evidenced by their execution of such Securities. Such temporary Securities may be in global form.

Except in the case of temporary Securities in global form (which shall be exchanged in accordance with the provisions of the following paragraphs), if temporary Securities of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay. After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities of any series (accompanied by any unmatured coupons appertaining thereto), the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like principal amount of definitive Securities of the same series of authorized denominations; provided , however , that no definitive Bearer Security shall be delivered in exchange for a temporary Registered Security; and provided further that a definitive Bearer Security shall be delivered in exchange for a temporary Bearer Security only in compliance with the conditions set forth in Section 303. Until so exchanged the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series.

If temporary Securities of any series are issued in global form, any such temporary global Security shall, unless otherwise provided therein, be delivered to the London, England office of a depositary or common depositary (the "Common Depositary"), for the benefit of Euroclear and Clearstream, for credit to the respective accounts of the beneficial owners of such Securities (or to such other accounts as they may direct).

Without unnecessary delay but in any event not later than the date specified in, or determined pursuant to the terms of, any such temporary global Security (the "Exchange Date"), the Company shall deliver to the Trustee definitive Securities, in aggregate principal amount equal to the principal amount of such temporary global Security, executed by the Company. On or after the Exchange Date such temporary global Security shall be surrendered by the Common Depositary to the Trustee, as the Company's agent for such purpose, to be exchanged, in whole or from time to time in part, for definitive Securities without charge and the Trustee shall authenticate and deliver, in exchange for each portion of such temporary global Security, an equal aggregate principal amount of definitive Securities of the same series of authorized denominations and of like tenor as the portion of such temporary global Security to be exchanged. The definitive Securities to be delivered in exchange for any such temporary global Security shall be in bearer form, registered form, permanent global bearer form or permanent global registered form, or any combination thereof, as specified as contemplated by Section 301, and, if any combination thereof is so specified, as requested by the beneficial owner thereof; provided , however , that, unless otherwise specified in such temporary global Security, upon such presentation by the Common Depositary, such temporary global Security is accompanied by a certificate dated the Exchange Date or a subsequent date and signed by Euroclear as to the portion of such temporary global Security held for its account then to be exchanged and a certificate dated the Exchange Date or a subsequent date and signed by Clearstream as to the portion of such temporary global Security held for its account then to be exchanged, each in the form set forth in Exhibit A-2 to this Indenture (or in such other form as may be established pursuant to Section 301); and provided further that definitive Bearer Securities shall be delivered in exchange for a portion of a temporary global Security only in compliance with the requirements of Section 303.

Unless otherwise specified in such temporary global Security, the interest of a beneficial owner of Securities of a series in a temporary global Security shall be exchanged for definitive Securities of the same series and of like tenor following the Exchange Date when the account holder instructs Euroclear or Clearstream, as the case may be, to request such exchange on his behalf and delivers to Euroclear or Clearstream, as the case may be, a certificate in the form set forth in Exhibit A-1 to this Indenture (or in such other form as may be established pursuant to Section 301), dated no earlier than 15 days prior to the Exchange Date, copies of which certificate shall be available from the offices of Euroclear and Clearstream, the Trustee, any Authenticating Agent appointed for such series of Securities and each Paying Agent. Unless otherwise specified in such temporary global Security, any such exchange shall be made free of charge to the beneficial owners of such temporary global Security, except that a Person receiving definitive Securities must bear the cost of insurance, postage, transportation and the like in the event that such Person does not take delivery of such definitive Securities in person at the offices of Euroclear or Clearstream. Definitive Securities in bearer form to be delivered in exchange for any portion of a temporary global Security shall be delivered only outside the United States.

Until exchanged in full as hereinabove provided, the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of the same series and of like tenor authenticated and delivered hereunder, except that, unless otherwise specified as contemplated by Section 301, interest payable on a temporary global Security on an Interest Payment Date for Securities of such series occurring prior to the applicable Exchange Date shall be payable to Euroclear and Clearstream on such Interest Payment Date upon delivery by Euroclear and Clearstream to the Trustee of a certificate or certificates in the form set forth in Exhibit A-2 to this Indenture (or in such other form as may be established pursuant to Section 301), for credit without further interest thereon on or after such Interest Payment Date to the respective accounts of the Persons who are the beneficial owners of such temporary global Security on such Interest Payment Date and who have each delivered to Euroclear or Clearstream, as the case may be, a certificate dated no earlier than 15 days prior to the Interest Payment Date occurring prior to such Exchange Date in the form set forth in Exhibit A-1 to this Indenture (or in such other form as may be established pursuant to Section 301). Notwithstanding anything to the contrary herein contained, the certifications made pursuant to this paragraph shall satisfy the certification requirements of the preceding two paragraphs of this Section and of the third paragraph of Section 303 of this Indenture and the interests of the Persons who are the beneficial owners of the temporary global Security with respect to which such certification was made will be exchanged for definitive Securities of the same series and of like tenor on the Exchange Date or the date of certification if such date occurs after the Exchange Date, without further act or deed by such beneficial owners. Except as otherwise provided in this paragraph, no payments of principal (or premium, if any) or interest, if any, owing with respect to a beneficial interest in a temporary global Security will be made unless and until such interest in such temporary global Security shall have been exchanged for an interest in a definitive Security. Any interest so received by Euroclear and Clearstream and not paid as herein provided shall be returned to the Trustee immediately prior to the expiration of two years after such Interest Payment Date in order to be repaid to the Company in accordance with Section 1003.

SECTION 305. Registration, Registration of Transfer and Exchange.

The Company shall cause to be kept at the Corporate Trust Office of the Trustee a register for each series of Securities (the registers maintained in the Corporate Trust Office of the Trustee and in any other office or agency of the Company in a Place of Payment being herein sometimes collectively referred to as the " Security Register ") in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Registered Securities and of transfers of Registered Securities. The Security Register shall be in written form or any other form capable of being converted into written form within a reasonable time. At all reasonable times, the Security Register shall be open to inspection by the Trustee. The Trustee is hereby initially appointed as security registrar (the " Security Registrar ") for the purpose of registering Registered Securities and transfers of Registered Securities as herein provided. The Company shall have the right to remove and replace from time to time the Security Registrar for any series of Securities; provided that , no such removal or replacement shall be effective until a successor Security Registrar with respect to such series of Registered Securities shall have been appointed by the Company and shall have accepted such appointment by the Company. In the event that the Trustee shall not be or shall cease to be the Security registrar with respect to a series of Securities, it shall have the right to examine the Security Register for such series at all reasonable times. There shall be only one Security Register for such series of Securities.

Upon surrender for registration of transfer of any Registered Security of any series at the office or agency in a Place of Payment for that series, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee, one or more new Registered Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor.

At the option of the Holder, Registered Securities of any series may be exchanged for other Registered Securities of the same series, of any authorized denomination and of a like aggregate principal amount and tenor, upon surrender of the Registered Securities to be exchanged at such office or agency. Whenever any Registered Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Registered Securities which the Holder making the exchange is entitled to receive. Unless otherwise specified with respect to any series of Securities as contemplated by Section 301, Bearer Securities may not be issued in exchange for Registered Securities.

If (but only if) expressly permitted in or pursuant to the applicable Board Resolution and (subject to Section 303) set forth in the applicable Officers' Certificate, or in any indenture supplemental hereto, delivered as contemplated by Section 301, at the option of the Holder, Bearer Securities of any series may be exchanged for Registered Securities of the same series of any authorized denomination and of a like aggregate principal amount and tenor, upon surrender of the Bearer Securities to be exchanged at any such office or agency, with all unmatured coupons and all matured coupons in default thereto appertaining. If the Holder of a Bearer Security is unable to produce any such unmatured coupon or coupons or matured coupon or coupons in default, any such permitted exchange may be effected if the Bearer Securities are accompanied by payment in funds acceptable to the Company in an amount equal to the face amount of such missing coupon or coupons, or the surrender of such missing coupon or coupons may be waived by the Company and the Trustee if there is furnished to them such security or indemnity as they may require to save each of them and any Paying Agent harmless. If thereafter the Holder of such Security shall surrender to any Paying Agent any such missing coupon in respect of which such a payment shall have been made, such Holder shall be entitled to receive the amount of such payment; provided , however , that, except as otherwise provided in Section 1002, interest represented by coupons shall be payable only upon presentation and surrender of those coupons at an office or agency located outside the United States. Notwithstanding the foregoing, in case a Bearer Security of any series is surrendered at any such office or agency in a permitted exchange for a Registered Security of the same series and like tenor after the close of business at such office or agency on (i) any Regular Record Date and before the opening of business at such office or agency on the relevant Interest Payment Date, or (ii) any Special Record Date and before the opening of business at such office or agency on the related proposed date for payment of Defaulted Interest, such Bearer Security shall be surrendered without the coupon relating to such Interest Payment Date or proposed date for payment, as the case may be, and interest or Defaulted Interest, as the case may be, will not be payable on such Interest Payment Date or proposed date for payment, as the case may be, in respect of the Registered Security issued in exchange for such Bearer Security, but will be payable only to the Holder of such coupon when due in accordance with the provisions of this Indenture.

Whenever any Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive.

Notwithstanding the foregoing, except as otherwise specified as contemplated by Section 301, any permanent global Security shall be exchangeable only as provided in this paragraph. If any beneficial owner of an interest in a permanent global Security is entitled to exchange such interest for Securities of such series and of like tenor and principal amount of another authorized form and denomination, as specified as contemplated by Section 301 and provided that any applicable notice provided in the permanent global Security shall have been given, then without unnecessary delay but in any event not later than the earliest date on which such interest may be so exchanged, the Company shall deliver to the Trustee definitive Securities in aggregate principal amount equal to the principal amount of such beneficial owner's interest in such permanent global Security, executed by the Company. On or after the earliest date on which such interests may be so exchanged, such permanent global Security shall be surrendered by the Common Depositary or such other depositary as shall be specified in the Company Order with respect thereto to the Trustee, as the Company's agent for such purpose, to be exchanged, in whole or from time to time in part, for definitive Securities without charge, and the Trustee shall authenticate and deliver, in exchange for each portion of such permanent global Security, an equal aggregate principal amount of definitive Securities of the same series of authorized denominations and of like tenor as the portion of such permanent global Security to be exchanged which, unless the Securities of the series are not issuable both as Bearer Securities and as Registered Securities, as specified as contemplated by Section 301, shall be in the form of Bearer Securities or Registered Securities, or any combination thereof, as shall be specified by the beneficial owner thereof; provided , however , that no such exchanges may occur during a period beginning at the opening of business 15 days before any selection of Securities to be redeemed and ending on the relevant Redemption Date if the Security for which exchange is requested may be among those selected for redemption; and provided , further , that no Bearer Security delivered in exchange for a portion of a permanent global Security shall be mailed or otherwise delivered to any location in the United States. If a Registered Security is issued in exchange for any portion of a permanent global Security after the close of business at the office or agency where such exchange occurs on (i) any Regular Record Date and before the opening of business at such office or agency on the relevant Interest Payment Date, or (ii) any Special Record Date and before the opening of business at such office or agency on the related proposed date for payment of Defaulted Interest, interest or Defaulted Interest, as the case may be, will not be payable on such Interest Payment Date or proposed date for payment, as the case may be, in respect of such Registered Security, but will be payable on such Interest Payment Date or proposed date for payment, as the case may be, only to the Person to whom interest in respect of such portion of such permanent global Security is payable in accordance with the provisions of this Indenture.

If at any time the Depositary for Securities of a series notifies the Company that it is unwilling, unable or no longer qualifies to continue as Depositary for Securities of such series or if at any time the Depositary for Securities for such series shall no longer be registered or in good standing under the Securities Exchange Act of 1934, as amended, or other applicable statute or regulation, the Company shall appoint a successor depositary with respect to the Securities for such series. If a successor to the Depositary for Securities is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such condition, as the case may be, the Company's election pursuant to Section 301 shall no longer be effective with respect to the Securities for such series and the Company will execute, and the Trustee, upon receipt of a Company Order for the authentication and delivery of definitive Securities of such series, will authenticate and deliver Securities of such series in definitive registered form, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the global Security or Securities representing such series in exchange for such global Security or Securities.

The Company may at any time and in its sole discretion determine that the Securities of any series issued in the form of one or more global Securities shall no longer be represented by such global Security or Securities. In such event the Company will execute, and the Trustee, upon receipt of a Company Order for the authentication and delivery of definitive Securities of such series, will authenticate and deliver Securities of such series in definitive registered form, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the global Security or Securities representing such series in exchange for such global Security or Securities.

Upon the exchange of a global Security for Securities in definitive registered form, such global Security shall be cancelled by the Trustee. Securities issued in exchange for a global Security pursuant to this Section shall be registered in such names and in such authorized denominations as the depositary for such global Security, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee in writing. The Trustee shall deliver such Securities to the persons in whose names such Securities are so registered.

All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange.

Every Registered Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Company or the Security Registrar) be duly endorsed, or be accompanied by a written instrument of transfer, in form satisfactory to the Company and the Security Registrar, duly executed by the Holder thereof or his attorney duly authorized in writing.

No service charge shall be made for any registration of transfer or exchange of Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Section 304, 906, 1107 or 1305 not involving any transfer.

The Company shall not be required (i) to issue, register the transfer of or exchange Securities of any series during a period beginning at the opening of business 15 days before the day of the selection for redemption of Securities of that series under Section 1103 or 1203 and ending at the close of business on (A) if Securities of the series are issuable only as Registered Securities, the day of the mailing of the relevant notice of redemption and (B) if Securities of the series are issuable as Bearer Securities, the day of the first publication of the relevant notice of redemption or, if Securities of the series are also issuable as Registered Securities and there is no publication, the mailing of the relevant notice of redemption, or (ii) to register the transfer of or exchange any Registered Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (iii) to exchange any Bearer Security so selected for redemption except that such a Bearer Security may be exchanged for a Registered Security of that series and like tenor; provided that such Registered Security shall be immediately surrendered for redemption, or (iv) to issue, register the transfer of or exchange any Security which has been surrendered for repayment at the option of the Holder, except the portion, if any, of such Security not to be so repaid.

SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.

If any mutilated Security or a Security with a mutilated coupon appertaining to it is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding, with coupons corresponding to the coupons, if any, appertaining to the surrendered Security, or, in case any such mutilated Security or coupon has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, with coupons corresponding to the coupons, if any, appertaining to the surrendered Security, pay such Security or coupon.

If there shall be delivered to the Company and to the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Security or coupon and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Security or coupon has been acquired by a protected purchaser (as defined in Article 8 of the UCC), the Company shall execute and upon Company Order the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Security or in exchange for the Security for which a destroyed, lost or stolen coupon appertains (with all appurtenant coupons not destroyed, lost or stolen), a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding, with coupons corresponding to the coupons, if any, appertaining to such destroyed, lost or stolen Security or to the Security to which such destroyed, lost or stolen coupon appertains.

Notwithstanding the provisions of the previous two paragraphs, in case any such mutilated, destroyed, lost or stolen Security or coupon has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, with coupons corresponding to the coupons, if any, appertaining to such mutilated, destroyed, lost or stolen Security or to the Security to which such mutilated, destroyed, lost or stolen coupon appertains, pay such Security or coupon; provided , however , that payment of principal of (and premium, if any) and interest, if any, on Bearer Securities shall, except as otherwise provided in Section 1002, be payable only at an office or agency located outside the United States and, unless otherwise specified as contemplated by Section 301, any interest on Bearer Securities shall be payable only upon presentation and surrender of the coupons appertaining thereto.

Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith.

Every new Security of any series with its coupons, if any, issued pursuant to this Section in lieu of any mutilated, destroyed, lost or stolen Security or in exchange for a Security to which a mutilated, destroyed, lost or stolen coupon appertains, shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, destroyed, lost or stolen Security and its coupons, if any, or the mutilated, destroyed, lost or stolen coupon shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of that series and their coupons, if any, duly issued hereunder.

The provisions of this Section, as amended or supplemented pursuant to this Indenture with respect to particular Securities or generally, are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities or coupons.

SECTION 307. Payment of Principal and Interest; Interest Rights Preserved; Optional Interest Reset.

(a) Unless otherwise provided as contemplated by Section 301 with respect to any series of Securities, interest, if any, on any Registered Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name such Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest at the office or agency of the Company maintained for such purpose pursuant to Section 1002; provided , however , that each installment of the principal of (and premium, if any) and interest, if any, on any Registered Security may at the Company's option be paid by (i) mailing a check for such interest, payable to or upon the written order of the Person entitled thereto pursuant to Section 309, to the address of such Person as it appears on the Security Register or (ii) wire transfer to an account of the person entitled to receive such payment if such person is a Holder of $1,000,000 or more in aggregate principal amount of the Securities of such series (with wire transfer instructions provided to the Trustee not less than 15 days prior to payment of interest by wire transfer); provided further , that principal paid in relation to any Security redeemed at the option of the Company pursuant to Article Eleven, or paid at Maturity, shall be paid to the holder of such Security only upon presentation and surrender of such Security to such office or agency referred to in this Section 307(a).

Unless otherwise provided as contemplated by Section 301 with respect to the Securities of any series, payment of interest, if any, may be made, in the case of a Bearer Security, by transfer to an account located outside the United States maintained by the payee.

Unless otherwise provided as contemplated by Section 301, every permanent global Security will provide that interest, if any, payable on any Interest Payment Date will be paid to each of Euroclear and Clearstream with respect to that portion of such permanent global Security held for its account by the Common Depositary, for the purpose of permitting each of Euroclear and Clearstream to credit the interest, if any, received by it in respect of such permanent global Security to the accounts of the beneficial owners thereof.

Any interest on any Registered Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such defaulted interest and, if applicable, interest on such defaulted interest (to the extent lawful) at the rate specified in the Securities of such series (such defaulted interest and, if applicable, interest thereon herein collectively called " Defaulted Interest ") may be paid by the Company, at its election in each case, as provided in clause (1) or (2) below:

(1) The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Registered Securities of such series (or their respective Predecessor Securities) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Registered Security of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money in the Currency in which the Securities of such series are payable (except as otherwise specified pursuant to Section 301 for the Securities of such series and except, if applicable, as provided in Sections 312(b), 312(d) and 312(e)) equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit on or prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be given in the manner provided in Section 106, not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been so given, such Defaulted Interest shall be paid to the Persons in whose name the Registered Securities of such series (or their respective Predecessor Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (2).

(2) The Company may make payment of any Defaulted Interest on the Registered Securities of any series in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

(b) The provisions of this Section 307(b) may be made applicable to any series of Securities pursuant to Section 301 (with such modifications, additions or substitutions as may be specified pursuant to such Section 301). The interest rate (or the spread or spread multiplier used to calculate such interest rate, if applicable) on any Security of such series may be reset by the Company on the date or dates specified on the face of such Security (each an " Optional Reset Date "). The Company may exercise such option with respect to such Security by notifying the Trustee of such exercise at least 50 but not more than 60 days prior to an Optional Reset Date for such Note. Not later than 40 days prior to each Optional Reset Date, the Trustee shall transmit, in the manner provided for in Section 106, to the Holder of any such Security a notice (the " Reset Notice ") indicating whether the Company has elected to reset the interest rate (or the spread or spread multiplier used to calculate such interest rate, if applicable), and if so (i) such new interest rate (or such new spread or spread multiplier, if applicable) and (ii) the provisions, if any, for redemption during the period from such Optional Reset Date to the next Optional Reset Date or if there is no such next Optional Reset Date, to the Stated Maturity Date of such Security (each such period a " Subsequent Interest Period "), including the date or dates on which or the period or periods during which and the price or prices at which such redemption may occur during the Subsequent Interest Period.

Notwithstanding the foregoing, not later than 20 days prior to the Optional Reset Date, the Company may, at its option, revoke the interest rate (or the spread or spread multiplier used to calculate such interest rate, if applicable) provided for in the Reset Notice and establish an interest rate (or a spread or spread multiplier used to calculate such interest rate, if applicable) that is higher than the interest rate (or the spread or spread multiplier, if applicable) provided for in the Reset Notice, for the Subsequent Interest Period by causing the Trustee to transmit, in the manner provided for in Section 106, notice of such higher interest rate (or such higher spread or spread multiplier, if applicable) to the Holder of such Security. Such notice shall be irrevocable. All Securities with respect to which the interest rate (or the spread or spread multiplier used to calculate such interest rate, if applicable) is reset on an Optional Reset Date, and with respect to which the Holders of such Securities have not tendered such Securities for repayment (or have validly revoked any such tender) pursuant to the next succeeding paragraph, will bear such higher interest rate (or such higher spread or spread multiplier, if applicable).

The Holder of any such Security will have the option to elect repayment by the Company of the principal of such Security on each Optional Reset Date at a price equal to the principal amount thereof plus interest accrued to such Optional Reset Date. In order to obtain repayment on an Optional Reset Date, the Holder must follow the procedures set forth in Article Thirteen for repayment at the option of Holders except that the period for delivery or notification to the Trustee shall be at least 25 but not more than 35 days prior to such Optional Reset Date and except that, if the Holder has tendered any Security for repayment pursuant to the Reset Notice, the Holder may, by written notice to the Trustee, revoke such tender or repayment until the close of business on the tenth day before such Optional Reset Date.

Subject to the foregoing provisions of this Section and Section 305, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.

SECTION 308. Optional Extension of Stated Maturity.

The provisions of this Section 308 may be made applicable to any series of Securities pursuant to Section 301 (with such modifications, additions or substitutions as may be specified pursuant to such Section 301). The Stated Maturity of any Security of such series may be extended at the option of the Company for the period or periods specified on the face of such Security (each an " Extension Period ") up to but not beyond the date (the " Final Maturity ") set forth on the face of such Security. The Company may exercise such option with respect to any Security by notifying the Trustee of such exercise at least 50 but not more than 60 days prior to the Stated Maturity of such Security in effect prior to the exercise of such option (the " Original Stated Maturity "). If the Company exercises such option, the Trustee shall transmit, in the manner provided for in Section 106, to the Holder of such Security not later than 40 days prior to the Original Stated Maturity a notice (the " Extension Notice ") indicating (i) the election of the Company to extend the Stated Maturity, (ii) the new Stated Maturity, (iii) the interest rate, if any, applicable to the Extension Period and (iv) the provisions, if any, for redemption during such Extension Period. Upon the Trustee's transmittal of the Extension Notice, the Stated Maturity of such Security shall be extended automatically and, except as modified by the Extension Notice and as described in the next paragraph, such Security will have the same terms as prior to the transmittal of such Extension Notice.

Notwithstanding the foregoing, not later than 20 days before the Original Stated Maturity of such Security, the Company may, at its option, revoke the interest rate provided for in the Extension Notice and establish a higher interest rate for the Extension Period by causing the Trustee to transmit, in the manner provided for in Section 106, notice of such higher interest rate to the Holder of such Security. Such notice shall be irrevocable. All Securities with respect to which the Stated Maturity is extended will bear such higher interest rate.

If the Company extends the Maturity of any Security, the Holder will have the option to elect repayment of such Security by the Company on the Original Stated Maturity at a price equal to the principal amount thereof, plus interest accrued to such date. In order to obtain repayment on the Original Stated Maturity once the Company has extended the Maturity thereof, the Holder must follow the procedures set forth in Article Thirteen for repayment at the option of Holders, except that the period for delivery or notification to the Trustee shall be at least 25 but not more than 35 days prior to the Original Stated Maturity and except that, if the Holder has tendered any Security for repayment pursuant to an Extension Notice, the Holder may by written notice to the Trustee revoke such tender for repayment until the close of business on the tenth day before the Original Stated Maturity.

SECTION 309. Persons Deemed Owners.

Prior to due presentment of a Registered Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Registered Security is registered as the owner of such Registered Security for the purpose of receiving payment of principal of (and premium, if any) and (subject to Sections 305 and 307) interest, if any, on such Security and for all other purposes whatsoever (other than the payment of Additional Amounts, if any), whether or not such Security be overdue, and none of the Company, the Trustee or any agent of the Company or the Trustee shall be affected by notice to the contrary.

Title to any Bearer Security and any coupons appertaining thereto shall pass by delivery. The Company, the Trustee and any agent of the Company or the Trustee may treat the bearer of any Bearer Security and the bearer of any coupon as the absolute owner of such Security or coupon for the purpose of receiving payment thereof or on account thereof and for all other purposes whatsoever, whether or not such Security or coupons be overdue, and none of the Company, the Trustee or any agent of the Company or the Trustee shall be affected by notice to the contrary.

The Depositary for Securities may be treated by the Company, the Trustee, and any agent of the Company or the Trustee as the owner of such global Security for all purposes whatsoever (other than the payment of Additional Amounts, if any). None of the Company, the Trustee, any Paying Agent or the Security Registrar will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of a Security in global form or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.

Notwithstanding the foregoing, with respect to any global Security, nothing herein shall prevent the Company, the Trustee, or any agent of the Company or the Trustee, from giving effect to any written certification, proxy or other authorization furnished by any depositary, as a Holder, with respect to such global Security or impair, as between such depositary and owners of beneficial interests in such global Security, the operation of customary practices governing the exercise of the rights of such depositary (or its nominee) as Holder of such global Security.

SECTION 310. Cancellation.

All Securities and coupons surrendered for payment, redemption, repayment at the option of the Holder, registration of transfer or exchange or for credit against any current or future sinking fund payment shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee. All Securities and coupons so delivered to the Trustee shall be promptly cancelled by it. The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated and delivered hereunder which the Company may have acquired in any manner whatsoever, and may deliver to the Trustee (or to any other Person for delivery to the Trustee) for cancellation any Securities previously authenticated hereunder which the Company has not issued and sold, and all Securities so delivered shall be promptly cancelled by the Trustee. If the Company shall so acquire any of the Securities, however, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Securities unless and until the same are surrendered to the Trustee for cancellation. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of by the Trustee in accordance with its customary procedures and certification of their disposal delivered to the Company unless by Company Order the Company shall direct that cancelled Securities be returned to it.

SECTION 311. Computation of Interest.

Except as otherwise specified as contemplated by Section 301 with respect to any Securities, interest, if any, on the Securities of each series shall be computed on the basis of a 360-day year of twelve 30-day months. For the purposes of disclosure under the Interest Act (Canada), the yearly rate of interest to which interest calculated under a Security for any period in any calendar year (the " calculation period ") is equivalent, is the rate payable under a Security in respect of the calculation period multiplied by a fraction the numerator of which is the actual number of days in such calendar year and the denominator of which is the actual number of days in the calculation period.

SECTION 312. Currency and Manner of Payments in Respect of Securities.

(a) With respect to Registered Securities of any series not permitting the election provided for in paragraph (b) below or the Holders of which have not made the election provided for in paragraph (b) below, and with respect to Bearer Securities of any series, except as provided in paragraph (d) below, payment of the principal of (and premium, if any) and interest, if any, on any Registered or Bearer Security of such series will be made in the Currency in which such Registered Security or Bearer Security, as the case may be, is payable. The provisions of this Section 312 may be modified or superseded with respect to any Securities pursuant to Section 301.

(b) It may be provided pursuant to Section 301 with respect to Registered Securities of any series that Holders shall have the option, subject to paragraphs (d) and (e) below, to receive payments of principal of (or premium, if any) or interest, if any, on such Registered Securities in any of the Currencies which may be designated for such election by delivering to the Trustee a written election with signature guarantees and in the applicable form established pursuant to Section 301, not later than the close of business on the Election Date immediately preceding the applicable payment date. If a Holder so elects to receive such payments in any such Currency, such election will remain in effect for such Holder or any transferee of such Holder until changed by such Holder or such transferee by written notice to the Trustee (but any such change must be made not later than the close of business on the Election Date immediately preceding the next payment date to be effective for the payment to be made on such payment date and no such change of election may be made with respect to payments to be made on any Registered Security of such series with respect to which an Event of Default has occurred or with respect to which the Company has deposited funds pursuant to Article Four or Fourteen or with respect to which a notice of redemption has been given by the Company or a notice of option to elect repayment has been sent by such Holder or such transferee). Any Holder of any such Registered Security who shall not have delivered any such election to the Trustee not later than the close of business on the applicable Election Date will be paid the amount due on the applicable payment date in the relevant Currency as provided in Section 312(a). The Trustee shall notify the Exchange Rate Agent as soon as practicable after the Election Date of the aggregate principal amount of Registered Securities for which Holders have made such written election.

(c) Unless otherwise specified pursuant to Section 301, if the election referred to in paragraph (b) above has been provided for pursuant to Section 301, then, unless otherwise specified pursuant to Section 301, not later than the fourth Business Day after the Election Date for each payment date for Registered Securities of any series, the Exchange Rate Agent will deliver to the Company a written notice specifying, in the Currency in which Registered Securities of such series are payable, the respective aggregate amounts of principal of (and premium, if any) and interest, if any, on the Registered Securities to be paid on such payment date, specifying the amounts in such Currency so payable in respect of the Registered Securities as to which the Holders of Registered Securities of such series shall have elected to be paid in another Currency as provided in paragraph (b) above. If the election referred to in paragraph (b) above has been provided for pursuant to Section 301 and if at least one Holder has made such election, then, unless otherwise specified pursuant to Section 301, on the second Business Day preceding such payment date the Company will deliver to the Trustee for such series of Registered Securities an Exchange Rate Officer's Certificate in respect of the Dollar or Foreign Currency payments to be made on such payment date. Unless otherwise specified pursuant to Section 301, the Dollar or Foreign Currency amount receivable by Holders of Registered Securities who have elected payment in a Currency as provided in paragraph (b) above shall be determined by the Company on the basis of the applicable Market Exchange Rate in effect on the third Business Day (the " Valuation Date ") immediately preceding each payment date, and such determination shall be conclusive and binding for all purposes, absent manifest error.

(d) If a Conversion Event occurs with respect to a Foreign Currency in which any of the Securities are denominated or payable other than pursuant to an election provided for pursuant to paragraph (b) above, then with respect to each date for the payment of principal of (and premium, if any) and interest, if any, on the applicable Securities denominated or payable in such Foreign Currency occurring after the last date on which such Foreign Currency was used (the " Conversion Date "), the Dollar shall be the Currency of payment for use on each such payment date. Unless otherwise specified pursuant to Section 301, the Dollar amount to be paid by the Company to the Trustee and by the Trustee or any Paying Agent to the Holders of such Securities with respect to such payment date shall be, in the case of a Foreign Currency other than a currency unit, the Dollar Equivalent of the Foreign Currency or, in the case of a currency unit, the Dollar Equivalent of the Currency Unit, in each case as determined by the Exchange Rate Agent in the manner provided in paragraph (f) or (g) below.

(e) Unless otherwise specified pursuant to Section 301, if the Holder of a Registered Security denominated in any Currency shall have elected to be paid in another Currency as provided in paragraph (b) above, and a Conversion Event occurs with respect to such elected Currency, such Holder shall receive payment in the Currency in which payment would have been made in the absence of such election; and if a Conversion Event occurs with respect to the Currency in which payment would have been made in the absence of such election, such Holder shall receive payment in Dollars as provided in paragraph (d) above.

(f) The " Dollar Equivalent of the Foreign Currency " shall be determined by the Exchange Rate Agent and shall be obtained for each subsequent payment date by converting the specified Foreign Currency into Dollars at the Market Exchange Rate on the Conversion Date.

(g) The " Dollar Equivalent of the Currency Unit " shall be determined by the Exchange Rate Agent and subject to the provisions of paragraph (h) below shall be the sum of each amount obtained by converting the Specified Amount of each Component Currency into Dollars at the Market Exchange Rate for such Component Currency on the Valuation Date with respect to each payment.

(h) For purposes of this Section 312 the following terms shall have the following meanings:

A " Component Currency " shall mean any Currency which, on the Conversion Date, was a component currency of the relevant currency unit, including, but not limited to, the Euro.

A " Specified Amount " of a Component Currency shall mean the number of units of such Component Currency or fractions thereof which were represented in the relevant currency unit, including, but not limited to, the Euro, on the Conversion Date. If after the Conversion Date the official unit of any Component Currency is altered by way of combination or subdivision, the Specified Amount of such Component Currency shall be divided or multiplied in the same proportion. If after the Conversion Date two or more Component Currencies are consolidated into a single currency, the respective Specified Amounts of such Component Currencies shall be replaced by an amount in such single Currency equal to the sum of the respective Specified Amounts of such consolidated Component Currencies expressed in such single Currency, and such amount shall thereafter be a Specified Amount and such single Currency shall thereafter be a Component Currency. If after the Conversion Date any Component Currency shall be divided into two or more currencies, the Specified Amount of such Component Currency shall be replaced by amounts of such two or more currencies, having an aggregate Dollar Equivalent value at the Market Exchange Rate on the date of such replacement equal to the Dollar Equivalent value of the Specified Amount of such former Component Currency at the Market Exchange Rate immediately before such division and such amounts shall thereafter be Specified Amounts and such currencies shall thereafter be Component Currencies. If, after the Conversion Date of the relevant currency unit, including, but not limited to, the Euro, a Conversion Event (other than any event referred to above in this definition of "Specified Amount") occurs with respect to any Component Currency of such currency unit and is continuing on the applicable Valuation Date, the Specified Amount of such Component Currency shall, for purposes of calculating the Dollar Equivalent of the Currency Unit, be converted into Dollars at the Market Exchange Rate in effect on the Conversion Date of such Component Currency.

" Election Date " shall mean the date for any series of Registered Securities as specified pursuant to clause (13) of Section 301 by which the written election referred to in paragraph (b) above may be made.

All decisions and determinations of the Exchange Rate Agent regarding the Dollar Equivalent of the Foreign Currency, the Dollar Equivalent of the Currency Unit, the Market Exchange Rate and changes in the Specified Amounts as specified above shall be in its sole discretion and shall, in the absence of manifest error, be conclusive for all purposes and irrevocably binding upon the Company, the Trustee and all Holders of such Securities denominated or payable in the relevant Currency. The Exchange Rate Agent shall promptly give written notice to the Company and the Trustee of any such decision or determination.

In the event that the Company determines in good faith that a Conversion Event has occurred with respect to a Foreign Currency, the Company will immediately give written notice thereof to the Trustee and to the Exchange Rate Agent (and the Trustee will promptly thereafter give notice in the manner provided for in Section 106 to the affected Holders) specifying the Conversion Date. In the event the Company so determines that a Conversion Event has occurred with respect to the Euro or any other currency unit in which Securities are denominated or payable, the Company will immediately give written notice thereof to the Trustee and to the Exchange Rate Agent (and the Trustee will promptly thereafter give notice in the manner provided for in Section 106 to the affected Holders) specifying the Conversion Date and the Specified Amount of each Component Currency on the Conversion Date. In the event the Company determines in good faith that any subsequent change in any Component Currency as set forth in the definition of Specified Amount above has occurred, the Company will similarly give written notice to the Trustee and the Exchange Rate Agent.

The Trustee shall be fully justified and protected in relying and acting upon information received by it from the Company and the Exchange Rate Agent and shall not otherwise have any duty or obligation to determine the accuracy or validity of such information independent of the Company or the Exchange Rate Agent.

SECTION 313. Appointment and Resignation of Successor Exchange Rate Agent.

(a) Unless otherwise specified pursuant to Section 301, if and so long as the Securities of any series (i) are denominated in a Foreign Currency or (ii) may be payable in a Foreign Currency, or so long as it is required under any other provision of this Indenture, then the Company will maintain with respect to each such series of Securities, or as so required, at least one Exchange Rate Agent. The Company will cause the Exchange Rate Agent to make the necessary foreign exchange determinations at the time and in the manner specified pursuant to Section 301 for the purpose of determining the applicable rate of exchange and, if applicable, for the purpose of converting the issued Currency into the applicable payment Currency for the payment of principal (and premium, if any) and interest, if any, pursuant to Section 312.

(b) The Company shall have the right to remove and replace from time to time the Exchange Rate Agent for any series of Securities. No resignation of the Exchange Rate Agent and no appointment of a successor Exchange Rate Agent pursuant to this Section shall become effective until the acceptance of appointment by the successor Exchange Rate Agent as evidenced by a written instrument delivered to the Company and the Trustee.

(c) If the Exchange Rate Agent shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of the Exchange Rate Agent for any cause with respect to the Securities of one or more series, the Company, by or pursuant to a Board Resolution, shall promptly appoint a successor Exchange Rate Agent or Exchange Rate Agents with respect to the Securities of that or those series (it being understood that any such successor Exchange Rate Agent may be appointed with respect to the Securities of one or more or all of such series and that, unless otherwise specified pursuant to Section 301, at any time there shall only be one Exchange Rate Agent with respect to the Securities of any particular series that are originally issued by the Company on the same date and that are initially denominated and/or payable in the same Currency).

ARTICLE FOUR

SATISFACTION AND DISCHARGE

SECTION 401. Satisfaction and Discharge of Indenture.

This Indenture shall upon Company Request cease to be of further effect with respect to any series of Securities specified in such Company Request (except as to any surviving rights of registration of transfer or exchange of Securities of such series expressly provided for herein or pursuant hereto and any right to receive Additional Amounts as contemplated by Section 1005) and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture as to such series when

(1) either

(A) all Securities of such series theretofore authenticated and delivered and all coupons, if any, appertaining thereto (other than (i) coupons appertaining to Bearer Securities surrendered for exchange for Registered Securities and maturing after such exchange, whose surrender is not required or has been waived as provided in Section 305, (ii) Securities and coupons of such series which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 306, (iii) coupons appertaining to Securities called for redemption and maturing after the relevant Redemption Date, whose surrender has been waived as provided in Section 1106, and (iv) Securities and coupons of such series for whose payment money has theretofore been deposited in trust with the Trustee or any Paying Agent or segregated and held in trust by the Company and thereafter repaid to the Company, as provided in Section 1003) have been delivered to the Trustee for cancellation; or

(B) all Securities of such series and, in the case of (i) or (ii) below, any coupons appertaining thereto not theretofore delivered to the Trustee for cancellation

(i) have become due and payable, or

(ii) will become due and payable at their Stated Maturity within one year, or

(iii) if redeemable at the option of the Company, are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company,

and the Company, in the case of (i), (ii) or (iii) above, has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust for such purpose an amount in the Currency in which the Securities of such series are payable, sufficient to pay and discharge the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal (and premium, if any) and interest, if any, to the date of such deposit (in the case of Securities which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be;

(2) the Company has paid or caused to be paid all other sums payable hereunder by the Company; and

(3) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture as to such series have been complied with.

Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 606, the obligations of the Company to any Authenticating Agent under Section 611 and, if money shall have been deposited with the Trustee pursuant to subclause (B) of clause (1) of this Section, the obligations of the Trustee under Section 402 and the last paragraph of Section 1003 shall survive.

SECTION 402. Application of Trust Money.

Subject to the provisions of the last paragraph of Section 1003, all money deposited with the Trustee pursuant to Section 401 shall be held in trust and applied by it, in accordance with the provisions of the Securities, the coupons and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal (and premium, if any) and interest, if any, for whose payment such money has been deposited with the Trustee; but such money need not be segregated from other funds except to the extent required by law.

ARTICLE FIVE

REMEDIES

SECTION 501. Events of Default.

" Event of Default ", wherever used herein with respect to Securities of any series, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body), unless such event is specifically deleted or modified in or pursuant to a supplemental indenture, Board Resolution or Officers' Certificate establishing the terms of such series pursuant to Section 301 of this Indenture:

(1) default in the payment of any interest on any Security of that series, or any related coupon, when such interest or coupon becomes due and payable, and continuance of such default for a period of 30 days; or

(2) default in the payment of the principal of (or premium, if any, on) any Security of that series at its Maturity; or

(3) default in the performance, or breach, of any covenant or warranty of the Company in this Indenture in respect of the Securities of that series, and continuance of such default or breach for a period of 90 days after there has been given to the Company by the Trustee to the attention of the Senior Vice President and General Counsel to the Company via facsimile, with a hard copy then sent, by registered or certified mail, or to the Company (in the same manner) and the Trustee by the Holders of at least 25% in principal amount of all Outstanding Securities of any series affected thereby, a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a "Notice of Default" hereunder; or

(4) if an event of default (as defined in any indenture or instrument under which the Company or any Restricted Subsidiary has at the time of this Indenture or shall thereafter have outstanding any Debt for borrowed money) shall happen and be continuing, or the Company or any Restricted Subsidiary shall have failed to pay principal amounts with respect to such Debt at maturity (whether or not constituting an event of default) and such event of default or failure to pay shall result in Debt being declared due and payable or otherwise being accelerated, in either event so that an amount in excess of the greater of $75,000,000 and 3.5% of Shareholders' Equity of the Company shall be or become due and payable upon such declaration or prior to the date on which the same would otherwise have become due and payable (the "Accelerated Indebtedness"), and such acceleration shall not be rescinded or annulled, or such event of default or failure to pay under such indenture or instrument shall not be remedied or cured, whether by payment or otherwise, or waived by the holders of such Accelerated Indebtedness, then (a) if the Accelerated Indebtedness shall be as a result of an event of default which is not related to the failure to pay principal on the conditions set out in any such indenture or instrument, it shall not be considered an Event of Default for purposes of this Indenture until 30 days after such Debt has been accelerated, or (b) if the Accelerated Indebtedness shall occur as a result of such failure to pay principal or as a result of an event of default which is related to the failure to pay principal on the conditions set out in any such indenture or instrument, then (i) if such Accelerated Indebtedness is, by its terms, non-recourse to the borrower, it shall not be considered an Event of Default for purposes of this Indenture; or (ii) if such Accelerated Indebtedness is recourse to the borrower, any requirement for the giving of notice or the lapse of time or the happening of any further condition, event or act under such other indenture or instrument in connection with such failure to pay principal or event of default shall be applicable together with an additional seven days before being considered an Event of Default for purposes of this Indenture; or

(5) the entry of a decree or order by a court having jurisdiction in the premises adjudging the Company a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of the Company under the Bankruptcy and Insolvency Act (Canada), the Companies' Creditors Arrangement Act (Canada) or any other applicable insolvency law, or appointing a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Company or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of 90 consecutive days; or

(6) the institution by the Company of proceedings to be adjudicated a bankrupt or insolvent, or the consent by it to the institution of bankruptcy or insolvency proceedings against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under the Bankruptcy and Insolvency Act (Canada), the Companies' Creditors Arrangement Act (Canada) or any other applicable insolvency law, or the consent by it to the filing of any such petition or to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Company or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due; or

(7) any other Event of Default provided with respect to Securities of that series.

SECTION 502. Acceleration of Maturity; Rescission and Annulment.

If an Event of Default described in Section 501 with respect to Securities of any series at the time Outstanding occurs and is continuing, then in every such case the Trustee or the Holders of not less than 25% in principal amount of the Outstanding Securities of that series may, subject to any subordination provisions thereof, declare the principal amount (or, if the Securities of that series are Original Issue Discount Securities or Indexed Securities, such portion of the principal amount as may be specified in the terms of that series) of all of the Securities of that series to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by Holders), and upon any such declaration such principal amount (or specified portion thereof) shall become immediately due and payable.

At any time after a declaration of acceleration with respect to Securities of any series (or of all series, as the case may be) has been made, but before a judgment or decree for payment of the money due has been obtained by the Trustee as hereinafter provided in this Article, the Holders of a majority in principal amount of the Outstanding Securities of that series (or of all series, as the case may be), by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if

(1) the Company has paid or deposited with the Trustee a sum sufficient to pay in the Currency in which the Securities of such series are payable (except as otherwise specified pursuant to Section 301 for the Securities of such series and except, if applicable, as provided in Sections 312(b), 312(d) and 312(e))

(A) all overdue interest, if any, on all Outstanding Securities of that series (or of all series, as the case may be) and any related coupons,

(B) all unpaid principal of (and premium, if any) any Outstanding Securities of that series (or of all series, as the case may be) which has become due otherwise than by such declaration of acceleration, and interest on such unpaid principal at the rate or rates prescribed therefor in such Securities,

(C) to the extent payment of such interest is lawful, interest on overdue interest, if any, at the rate or rates prescribed therefor in such Securities, and

(D) all sums paid or advanced by the Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; and

(2) all Events of Default with respect to Securities of that series (or of all series, as the case may be), other than the non-payment of amounts of principal of (or premium, if any, on) or interest on Securities of that series (or of all series, as the case may be) which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 513.

No such rescission shall affect any subsequent default or impair any right consequent thereon.

SECTION 503. Collection of Debt and Suits for Enforcement by Trustee.

The Company covenants that if

(1) default is made in the payment of any installment of interest on any Security or any related coupon when such interest becomes due and payable and such default continues for a period of 30 days, or

(2) default is made in the payment of the principal of (or premium, if any, on) any Security at the Maturity thereof,

then the Company will, upon demand of the Trustee, pay to the Trustee for the benefit of the Holders of such Securities and coupons, the whole amount then due and payable on such Securities and coupons for principal (and premium, if any) and interest, if any, and interest on any overdue principal (and premium, if any) and on any overdue interest, at the rate or rates prescribed therefor in such Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

If the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its own name as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company or any other obligor upon such Securities and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.

If an Event of Default with respect to Securities of any series (or of all series, as the case may be) occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of Securities of such series (or of all series, as the case may be) by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.

SECTION 504. Trustee May File Proofs of Claim.

In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Company or any other obligor upon the Securities or the property of the Company or of such other obligor or their creditors, the Trustee (irrespective of whether the principal of the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Company for the payment of overdue principal, premium, if any, or interest) shall be entitled and empowered, by intervention in such proceeding or otherwise,

(i) to file a proof of claim for the whole amount of principal (and premium, if any), or such portion of the principal amount of any series of Original Issue Discount Securities or Indexed Securities as may be specified in the terms of such series, and interest, if any, owing and unpaid in respect of the Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding, and

(ii) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 606.

Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

SECTION 505. Trustee May Enforce Claims Without Possession of Securities.

All rights of action and claims under this Indenture or the Securities or coupons may be prosecuted and enforced by the Trustee without the possession of any of the Securities or coupons or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities and coupons in respect of which such judgment has been recovered.

SECTION 506. Application of Money Collected.

Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal (or premium, if any) or interest, if any, upon presentation of the Securities or coupons, or both, as the case may be, and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:

First: To the payment of all amounts due the Trustee under Section 606;

Second: To the payment of the amounts then due and unpaid for principal of (and premium, if any) and interest, if any, on the Securities and coupons in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities and coupons for principal (and premium, if any) and interest, if any, respectively; and

Third: The balance, if any, to the Person or Persons entitled thereto.

SECTION 507. Limitation on Suits.

No Holder of any Security of any series or any related coupons shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, the Securities of any series, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless

(1) such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of that series;

(2) the Holders of at least 25% in aggregate principal amount of the Outstanding Securities of that series (voting as one class) in the case of any Event of Default described in Section 501 shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder;

(3) such Holder or Holders have offered to the Trustee indemnity reasonably satisfactory to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request;

(4) the Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and

(5) no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority or more in principal amount of the Outstanding Securities of that series in the case of any Event of Default described in Section 501;

it being understood and intended that no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other Holders of Securities of the same series, in the case of any Event of Default described in Section 501, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all Holders of Securities of the same series, in the case of any Event of Default described in Section 501.

SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and Interest.

Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment, as provided herein (including, if applicable, Article Fourteen) and in such Security, of the principal of (and premium, if any) and (subject to Section 307) interest, if any, on, such Security or payment of such coupon on the respective Stated Maturities expressed in such Security or coupon (or, in the case of redemption, on the Redemption Date) and to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder.

SECTION 509. Restoration of Rights and Remedies.

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders of Securities and coupons shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

SECTION 510. Rights and Remedies Cumulative.

Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities or coupons in the last paragraph of Section 306, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders of Securities or coupons is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

SECTION 511. Delay or Omission Not Waiver.

No delay or omission of the Trustee or of any Holder of any Security or coupon to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

SECTION 512. Control by Holders.

With respect to the Securities of any series, the Holders of not less than a majority in principal amount of the Outstanding Securities of such series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, relating to or arising under Section 501, provided that

(1) such direction shall not be in conflict with any rule of law or with this Indenture,

(2) the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction, and

(3) the Trustee need not take any action which might involve it in personal liability or be unjustly prejudicial to the Holders of Securities of such series not consenting.

SECTION 513. Waiver of Past Defaults.

Subject to Section 502, the Holders of not less than a majority in principal amount of the Outstanding Securities of any series may on behalf of the Holders of all the Securities of such series waive any past default described in Section 501, and its consequences, except a default

(1) in respect of the payment of the principal of (or premium, if any) or interest, if any, on any Security or any related coupon, or

(2) in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Security of such series affected.

Upon any such waiver, any such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or Event of Default or impair any right consequent thereon.

SECTION 514. Waiver of Stay or Extension Laws.

The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

ARTICLE SIX

THE TRUSTEE

SECTION 601. Notice of Defaults.

Within 90 days after the occurrence of any Default hereunder with respect to the Securities of any series, the Trustee shall transmit in the manner and to the extent provided in TIA Section 313(c) notice of such default hereunder known to the Trustee, unless such Default shall have been cured or waived; provided , however , that, except in the case of a Default in the payment of the principal of (or premium, if any) or interest, if any, on any Security of such series or in the payment of any sinking fund installment with respect to Securities of such series, the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee or a trust committee of directors and/or Responsible Officers of the Trustee in good faith determine that the withholding of such notice is in the interest of the Holders of Securities of such series and any related coupons; and provided further that in the case of any Default of the character specified in Section 501(3) with respect to Securities of such series, no such notice to Holders shall be given until at least 30 days after the occurrence thereof.

SECTION 602. Certain Rights of Trustee.

Subject to the provisions of TIA Sections 315(a) through 315(d):

(1) the Trustee may conclusively rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties;

(2) any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution;

(3) whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, conclusively rely upon an Officers' Certificate;

(4) the Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon;

(5) the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders of Securities of any series or any related coupons pursuant to this Indenture, unless such Holders shall have offered to the Trustee security or indemnity reasonably satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction;

(6) the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney;

(7) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder;

(8) the Trustee shall not be liable for any action taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture;

(9) the Trustee shall not be deemed to have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities and this Indenture;

(10) the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder on behalf of the Trustee; and

(11) the Trustee may request that the Company deliver an Officers' Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers' Certificate may be signed by any person authorized to sign an Officers' Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.

The Trustee shall not be required to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

SECTION 603. Trustee Not Responsible for Recitals or Issuance of Securities.

The recitals contained herein and in the Securities, except for the Trustee's certificates of authentication, and in any coupons shall be taken as the statements of the Company, and neither the Trustee nor any Authenticating Agent assumes any responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities or coupons, except that the Trustee represents that it is duly authorized to execute and deliver this Indenture, authenticate the Securities and perform its obligations hereunder and that the statements made by it in a Statement of Eligibility on Form T-1 supplied to the Company are true and accurate, subject to the qualifications set forth therein. Neither the Trustee nor any Authenticating Agent shall be accountable for the use or application by the Company of Securities or the proceeds thereof.

SECTION 604. May Hold Securities.

The Trustee, any Authenticating Agent, any Paying Agent, any Security Registrar or any other agent of the Company or of the Trustee, in its individual or any other capacity, may become the owner or pledgee of Securities and coupons and, subject to Sections 310(b) and 311 of the Trust Indenture Act, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Authenticating Agent, Paying Agent, Security Registrar or such other agent. A Trustee that has resigned or was removed shall remain subject to Section 311(a) of the Trust Indenture Act.

SECTION 605. Money Held in Trust.

Money held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed with the Company.

SECTION 606. Compensation and Reimbursement.

The Company agrees:

(1) to pay to the Trustee from time to time such reasonable compensation as the Company and the Trustee shall from time to time agree in writing for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust);

(2) except as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence or bad faith; and

(3) to indemnify the Trustee for, and to hold it harmless against, any loss, damage, liability or expense incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses of defending itself against any claim (whether asserted by the Company, any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder.

The obligations of the Company under this Section to compensate the Trustee, to pay or reimburse the Trustee for expenses, disbursements and advances and to indemnify and hold harmless the Trustee shall constitute additional indebtedness hereunder and shall survive the satisfaction and discharge of this Indenture. As security for the performance of such obligations of the Company, the Trustee shall have a claim prior to the Securities upon all Property and funds held or collected by the Trustee as such, except funds held in trust for the payment of principal of (or premium, if any) or interest, if any, on particular Securities or any coupons.

When the Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 501(5) or (6), the expenses (including reasonable charges and expense of its counsel) of and the compensation for such services are intended to constitute expenses of administration under any applicable U.S. or Canadian federal, state or provincial bankruptcy, insolvency or other similar law.

The provisions of this Section shall survive the termination of this Indenture and the resignation or removal of the Trustee.

SECTION 607. Corporate Trustee Required; Eligibility.

There shall be at all times a Trustee hereunder which shall be eligible to act as Trustee under TIA Section 310(a)(1) and shall have a combined capital and surplus (together with that of its parent) of at least $50,000,000. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of Federal, State, territorial or District of Columbia supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article.

SECTION 608. Resignation and Removal; Appointment of Successor.

(a) No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 609.

(b) The Trustee may resign at any time with respect to the Securities of one or more series by giving written notice thereof to the Company. If the instrument of acceptance by a successor Trustee required by Section 609 shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

(c) The Trustee may be removed at any time with respect to the Securities of any series by Act of the Holders of not less than a majority in principal amount of the Outstanding Securities of such series, delivered to the Trustee and to the Company. If the instrument of acceptance by a successor Trustee required by Section 609 shall not have been delivered to the Trustee within 30 days after the giving of such notice of removal, the removed Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

(d) If at any time:

(1) the Trustee shall fail to comply with the provisions of TIA Section 310(b) after written request therefor by the Company or by any Holder who has been a bona fide Holder of a Security for at least six months, or

(2) the Trustee shall cease to be eligible under Section 607 and shall fail to resign after written request therefor by the Company or by any Holder who has been a bona fide Holder of a Security for at least six months, or

(3) the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation,

then, in any such case, (i) the Company, by a Board Resolution, may remove the Trustee with respect to all Securities or the Securities of such series, or (ii) subject to TIA Section 315(e), any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to all Securities of such series and the appointment of a successor Trustee or Trustees.

(e) If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, with respect to the Securities of one or more series, the Company, by a Board Resolution, shall promptly appoint a successor Trustee or Trustees with respect to the Securities of that or those series (it being understood that any such successor Trustee may be appointed with respect to the Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect to the Securities of any particular series). If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Securities of any series shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment, become the successor Trustee with respect to the Securities of such series and to that extent supersede the successor Trustee appointed by the Company. If no successor Trustee with respect to the Securities of any series shall have been so appointed by the Company or the Holders and accepted appointment in the manner hereinafter provided, any Holder who has been a bona fide Holder of a Security of such series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

(f) The Company shall give notice of each resignation and each removal of the Trustee with respect to the Securities of any series and each appointment of a successor Trustee with respect to the Securities of any series to the Holders of Securities of such series in the manner provided for in Section 106. Each notice shall include the name of the successor Trustee with respect to the Securities of such series and the address of its Corporate Trust Office.

SECTION 609. Acceptance of Appointment by Successor.

(a) In case of the appointment hereunder of a successor Trustee with respect to all Securities, every such successor Trustee so appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on the request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder.

(b) In case of the appointment hereunder of a successor Trustee with respect to the Securities of one or more (but not all) series, the Company, the retiring Trustee and each successor Trustee with respect to the Securities of one or more series shall execute and deliver an indenture supplemental hereto wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates, (2) if the retiring Trustee is not retiring with respect to all Securities, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees co-trustees of the same trust and that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee; and upon the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee shall become effective to the extent provided therein and each such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates; but, on request of the Company or any successor Trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder with respect to the Securities of that or those series to which the appointment of such successor Trustee relates. Whenever there is a successor Trustee with respect to one or more (but less than all) series of securities issued pursuant to this Indenture, the terms "Indenture" and "Securities" shall have the meanings specified in the provisos to the respective definitions of those terms in Section 101 which contemplate such situation.

(c) Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all rights, powers and trusts referred to in paragraph (a) or (b) of this Section, as the case may be.

(d) No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible under this Article.

SECTION 610. Merger, Conversion, Consolidation or Succession to Business.

Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto. In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities. In case any of the Securities shall not have been authenticated by such predecessor Trustee, any successor Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor Trustee. In all such cases such certificates shall have the full force and effect which this Indenture provides for the certificate of authentication of the Trustee; provided , however , that the right to adopt the certificate of authentication of any predecessor Trustee or to authenticate Securities in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or consolidation.

SECTION 611. Appointment of Authenticating Agent.

At any time when any of the Securities remain Outstanding, the Trustee may appoint an Authenticating Agent or Agents with respect to one or more series of Securities which shall be authorized to act on behalf of the Trustee to authenticate Securities of such series and the Trustee shall give written notice of such appointment to all Holders of Securities of the series with respect to which such Authenticating Agent will serve, in the manner provided for in Section 106. Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder. Any such appointment shall be evidenced by an instrument in writing signed by a Responsible Officer of the Trustee, and a copy of such instrument shall be promptly furnished to the Company. Wherever reference is made in this Indenture to the authentication and delivery of Securities by the Trustee or the Trustee's certificate of authentication, such reference shall be deemed to include authentication and delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business under the laws of the United States, any state thereof or the District of Columbia, authorized under such laws to act as Authenticating Agent, having a combined capital and surplus of not less than $50,000,000 and subject to supervision or examination by federal or state authority. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect specified in this Section.

Any corporation into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which such Authenticating Agent shall be a party, or any corporation succeeding to the corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided such corporation shall be otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or the Authenticating Agent.

An Authenticating Agent may resign at any time by giving written notice thereof to the Trustee and to the Company. The Trustee may at any time terminate the agency of an Authenticating Agent by giving written notice thereof to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time such Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent which shall be acceptable to the Company and shall give written notice of such appointment to all Holders of Securities of the series with respect to which such Authenticating Agent will serve, in the manner provided for in Section 106. Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section.

The Company agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this Section.

If an appointment with respect to one or more series is made pursuant to this Section, the Securities of such series may have endorsed thereon, in addition to the Trustee's certificate of authentication, an alternate certificate of authentication in the following form:

Dated:

This is one of the Securities of the series designated therein referred to in, and issued under, the within-mentioned Indenture.

		THE BANK OF NEW YORK, as Trustee
		By	as Authenticating Agent
		By	Authorized Signatory

ARTICLE SEVEN

HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY

SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.

The Company will furnish or cause to be furnished to the Trustee (1) not more than 15 days after each Regular Record Date a list, in such form as the Trustee may reasonably require, of the names and addresses of Holders as of such Regular Record Date; provided , however , that the Company shall not be obligated to furnish or cause to be furnished such list at any time that the list shall not differ in any respect from the most recent list furnished to the Trustee by the Company and at such times as the Trustee is acting as Security Registrar for the applicable series of Securities and (2) at such other times as the Trustee may request in writing within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished.

SECTION 702. Preservation of List of Names and Addresses of Holders.

The Trustee shall preserve, in as current a form as is reasonably practicable, all information as to the names and addresses of the Holders contained in the most recent list furnished to it as provided in Section 701 and as to the names and addresses of Holders received by the Trustee in its capacity as Security Registrar for the applicable series of Securities (if acting in such capacity).

The Trustee may destroy any list furnished to it as provided in Section 701 upon receipt of a new list so furnished.

Holders may communicate as provided in Section 312(b) of the Trust Indenture Act with other Holders with respect to their rights under this Indenture or under the Securities.

SECTION 703. Disclosure of Names and Addresses of Holders.

Every Holder of Securities or coupons, by receiving and holding the same, agrees with the Company and the Trustee that none of the Company or the Trustee or any agent of either of them shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the Holders in accordance with TIA Section 312, regardless of the source from which such information was derived, and that the Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under TIA Section 312(b).

SECTION 704. Reports by Trustee.

(i): Within 60 days after May 15 of each year commencing with the first May 15 after the first issuance of Securities pursuant to this Indenture, the Trustee shall transmit to the Holders of Securities, in the manner and to the extent provided in Section 313(c) of the Trust Indenture Act, a brief report dated as of such May 15 if required by Section 313(a) of the Trust Indenture Act.
(ii): The Trustee shall comply with Sections 313(b) and 313(c) of the Trust Indenture Act.
(iii): A copy of such report shall, at the time of such transmission to the Holders, be filed by the Trustee with the Company (Attention: Senior Vice President and General Counsel), with each securities exchange upon which any of the Securities are listed (if so listed) and also with the Commission. The Company agrees to notify the Trustee when the Securities become listed on any stock exchange.

SECTION 705. Reports by the Company.

The Company shall:

(1) file with the Trustee, within 15 days after the Company is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Company may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934;

(2) file with the Trustee and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such additional information, documents and reports with respect to compliance by the Company with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations;

(3) notwithstanding that the Company may not be required to remain subject to the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, or otherwise report on an annual and quarterly basis on forms provided for such annual and quarterly reporting pursuant to rules and regulations promulgated by the Commission, the Company shall provide the Trustee:

(a) within time periods required for the filing of such forms by the Commission, annual reports on Form 40-F or 20-F, as applicable (or any successor form); and

(b) within time periods required for the filing of such forms by the Commission, reports on Form 6-K (or any successor form) which, regardless of applicable requirements, shall, at a minimum, contain such information required to be provided in quarterly reports under the laws of Canada or any province thereof to security holders of a company with securities listed on the Toronto Stock Exchange, whether or not the Company has any of its securities so listed.

Such information, to the extent permitted by the rules and regulations of the Commission, shall be prepared in accordance with Canadian disclosure requirements and GAAP; provided , however , that the Company shall not be obligated to file such reports with the Commission if the Commission does not permit such filings; and

(4) transmit to all Holders, in the manner and to the extent provided in Section 313(c) of the Trust Indenture Act, within 30 days after the filing thereof with the Trustee, such summaries of any information, documents and reports required to be filed by the Company pursuant to paragraphs (1) and (2) of this Section as may be required by rules and regulations prescribed from time to time by the Commission.

Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company's compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers' Certificates).

ARTICLE EIGHT

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

SECTION 801. Company May Consolidate, etc., Only on Certain Terms.

The Company shall not consolidate or amalgamate with or merge into or enter into any statutory arrangement with any other corporation, or convey, transfer or lease all or substantially all of the properties and assets of the Company and its Subsidiaries on a consolidated basis to any Person, unless:

(1) the entity formed by or continuing from such consolidation or amalgamation or into which the Company is merged or with which the Company enters into such arrangement or the Person which acquires by conveyance or transfer, or which leases, all or substantially all of the properties and assets of the Company (A) shall be a corporation, partnership or trust organized and validly existing under the laws of the United States, any state thereof or the District of Columbia, the laws of Canada or any province thereof, or, if such consolidation, amalgamation, merger, arrangement or other transaction would not impair the rights of Holders, in any other country, provided that if such successor entity is organized under the laws of a jurisdiction other than Canada or the United States, the successor entity assumes the Company's obligations under the Securities and this Indenture to pay Additional Amounts, substituting the name of such successor jurisdiction for Canada in each place that Canada appears in Section 1005 and (B) shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, or shall assume by operation of law, the Company's obligation for the due and punctual payment of the principal of (and premium, if any) and interest, if any, on all the Securities and the performance and observance of every covenant of this Indenture on the part of the Company to be performed or observed;

(2) immediately before and after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing; and

(3) the Company or such Person shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that such consolidation, amalgamation, merger, conveyance, transfer or lease and such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with.

This Section shall only apply to a merger, amalgamation, consolidation or statutory arrangement in which the Company is not the surviving corporation and to conveyances, leases and transfers by the Company as transferor or lessor. Notwithstanding anything to the contrary in this Section 801, the Company may consolidate or amalgamate with or merge into or enter into a statutory arrangement with any direct or indirect Wholly Owned Subsidiary of the Company and convey, transfer or lease all or substantially all of the properties and assets of the Company and its Subsidiaries on a consolidated basis to any direct or indirect Wholly Owned Subsidiary of the Company without complying with the above provisions in a transaction or series of transactions in which the Company remains the obligor on the Securities (a " Permitted Reorganization ") provided that Company has provided the Trustee and all of the Company's then current ratings agencies with notice of its intention to enter into a Permitted Reorganization at least 45 days prior to the proposed date of completion of such Permitted Reorganization (the " Permitted Reorganization Date ") and provided further that on or prior to the Permitted Reorganization Date the Company has delivered to the Trustee an Officers' Certificate confirming that, as of the Permitted Reorganization Date:

(i): all Debt of the Company which ranked pari passu with the then outstanding Securities immediately prior to the proposed Permitted Reorganization will rank no better than pari passu with such Securities after the Permitted Reorganization; for certainty, there is no requirement for any such other Debt to obtain or maintain similar ranking to such Securities and such other Debt may be structurally subordinated or otherwise subordinated to the Securities; or
(ii): at least two of the Company's then current credit rating agencies (or if only one credit rating agency maintains ratings in respect of the Company's debt securities at such time, that one rating agency) have affirmed that the rating assigned by them to the Securities shall not be downgraded as a result of the Permitted Reorganization, or notice thereof.

SECTION 802. Successor Person Substituted.

Upon any consolidation or amalgamation by the Company with or merger by the Company into any other corporation or any conveyance, transfer or lease all or substantially all of the properties and assets of the Company to any Person in accordance with Section 801, the successor Person formed by such consolidation or amalgamation or into which the Company is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor Person had been named as the Company herein, and in the event of any such conveyance or transfer, the Company (which term shall for this purpose mean the Person named as the "Company" in the first paragraph of this Indenture or any successor Person which shall theretofore become such in the manner described in Section 801), except in the case of a lease, shall be discharged of all obligations and covenants under this Indenture and the Securities and the coupons and may be dissolved and liquidated.

SECTION 803. Securities to Be Secured in Certain Events.

If, upon any such consolidation or amalgamation of the Company with or merger of the Company into any other corporation, or upon any conveyance, lease or transfer of the Property of the Company as an entirety or substantially as an entirety to any other Person, any Property of the Company or of any Restricted Subsidiary, would thereupon become subject to any Lien, then unless such Lien could be created pursuant to Section 1009 without equally and ratably securing the Securities, the Company, prior to or simultaneously with such consolidation, amalgamation, merger, conveyance, lease or transfer, will, as to such Property, secure the Securities Outstanding hereunder (together with, if the Company shall so determine, any other Debt of the Company now existing or hereafter created which is not subordinate to the Securities) equally and ratably with (or prior to) the Debt which upon such consolidation, amalgamation, merger, conveyance, lease or transfer is to become secured as to such Property by such Lien, or will cause such Securities to be so secured; provided that, for the purpose of providing such equal and ratable security, the principal amount of Original Issue Discount Securities and Indexed Securities shall mean that amount which would at the time of making such effective provision be due and payable pursuant to Section 502 and the terms of such Original Issue Discount Securities and Indexed Securities upon a declaration of acceleration of the Maturity thereof, and the extent of such equal and ratable security shall be adjusted, to the extent permitted by law, as and when said amount changes over time pursuant to the terms of such Original Issue Discount Securities and Indexed Securities.

ARTICLE NINE

SUPPLEMENTAL INDENTURES

SECTION 901. Supplemental Indentures Without Consent of Holders.

Without the consent of any Holders, the Company, when authorized by or pursuant to a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes:

(1) to evidence the succession of another Person to the Company and the assumption by any such successor of the covenants of the Company contained herein and in the Securities; or

(2) to add to the covenants of the Company for the benefit of the Holders of all or any series of Securities and any related coupons (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company; or

(3) to add any additional Events of Default (and if such Events of Default are to be for the benefit of less than all series of Securities, stating that such Events of Default are being included solely for the benefit of such series); or

(4) to add to or change any of the provisions of this Indenture to provide that Bearer Securities may be registrable as to principal, to change or eliminate any restrictions on the payment of principal of or any premium or interest on Bearer Securities, to permit Bearer Securities to be issued in exchange for Registered Securities, to permit Bearer Securities to be issued in exchange for Bearer Securities of other authorized denominations or to permit or facilitate the issuance of Securities in uncertificated form; provided that any such action shall not adversely affect the interests of the Holders of Securities of any series or any related coupons in any material respect; or

(5) to change or eliminate any of the provisions of this Indenture; provided that any such change or elimination shall become effective only when there is no Security Outstanding of any series created prior to the execution of such supplemental indenture which is entitled to the benefit of such provision; or

(6) to secure the Securities pursuant to the requirements of Section 803 or 1009 or otherwise; or

(7) to establish the form or terms of Securities of any series as permitted by Sections 201 and 301; or

(8) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 609(b); or

(9) to close this Indenture with respect to the authentication and delivery of additional series of Securities, to cure any ambiguity, to correct or supplement any provision herein which may be inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Indenture; provided such action shall not adversely affect the interests of the Holders of Securities of any series and any related coupons in any material respect; or

(10) to supplement any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the defeasance and discharge of any series of Securities pursuant to Sections 401, 1402 and 1403; provided that, in each such case, any such action shall not adversely affect the interests of the Holders of Securities of such series and any related coupons or any other series of Securities in any material respect.

SECTION 902. Supplemental Indentures with Consent of Holders.

With the consent of the Holders of not less than a majority in principal amount of all Outstanding Securities affected by such supplemental indenture (voting as one class), by Act of said Holders delivered to the Company and the Trustee, the Company, when authorized by or pursuant to a Board Resolution, and the Trustee may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture which affect such series of Securities or of modifying in any manner the rights of the Holders of Securities of such series under this Indenture; provided , however , that no such supplemental indenture shall, without the consent of the Holder of each Outstanding Security of such series,

(1) change the Stated Maturity of the principal of (or premium, if any) or any installment of interest on any Security of such series, or reduce the principal amount thereof (or premium, if any) or the rate of interest, if any, thereon, or change any obligation of the Company to pay Additional Amounts contemplated by Section 1005 (except as contemplated by Section 801(1) and permitted by Section 901(1)), or reduce the amount of the principal of an Original Issue Discount Security of such series that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502 or the amount thereof provable in bankruptcy pursuant to Section 504, or adversely affect any right of repayment at the option of any Holder of any Security of such series, or change any Place of Payment where, or the Currency in which, any Security of such series or any premium or interest thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or, in the case of redemption or repayment at the option of the Holder, on or after the Redemption Date or Repayment Date, as the case may be), or adversely affect any right to convert or exchange any Security as may be provided pursuant to Section 301 herein, or

(2) reduce the percentage in principal amount of the Outstanding Securities of such series required for any such supplemental indenture, or the consent of whose Holders is required for any waiver of compliance with certain provisions of this Indenture which affect such series or certain defaults applicable to such series hereunder and their consequences provided for in this Indenture, or reduce the requirements of Section 1504 for quorum or voting with respect to Securities of such series, or

(3) modify any of the provisions of this Section, Section 513 or Section 1010, except to increase any such percentage or to provide that certain other provisions of this Indenture which affect such series cannot be modified or waived without the consent of the Holder of each Outstanding Security of such series.

A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities, or which modifies the rights of the Holders of Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series. Any such supplemental indenture adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture, or modifying in any manner the rights of the Holders of Securities of such series, shall not affect the rights under this Indenture of the Holders of Securities of any other series.

It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof.

SECTION 903. Execution of Supplemental Indentures.

In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustee's own rights, duties or immunities under this Indenture or otherwise.

SECTION 904. Effect of Supplemental Indentures.

Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.

SECTION 905. Conformity with Trust Indenture Act.

Every supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act as then in effect.

SECTION 906. Reference in Securities to Supplemental Indentures.

Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Securities of any series so modified as to conform, in the opinion of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for Outstanding Securities of such series.

SECTION 907. Notice of Supplemental Indentures.

Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to the provisions of Section 902, the Company shall give notice thereof to the Holders of each Outstanding Security affected, in the manner provided for in Section 106, setting forth in general terms the substance of such supplemental indenture.

ARTICLE TEN

COVENANTS

SECTION 1001. Payment of Principal, Premium, if any, and Interest.

The Company covenants and agrees for the benefit of the Holders of each series of Securities and any related coupons that it will duly and punctually pay the principal of (and premium, if any) and interest, if any, on the Securities of that series in accordance with the terms of the Securities, any coupons appertaining thereto and this Indenture. Unless otherwise specified as contemplated by Section 301 with respect to any series of Securities, any interest installments due on Bearer Securities on or before Maturity shall be payable only upon presentation and surrender of the several coupons for such interest installments as are evidenced thereby as they severally mature.

SECTION 1002. Maintenance of Office or Agency.

If the Securities of a series are issuable only as Registered Securities, the Company will maintain in each Place of Payment for any series of Securities an office or agency where Securities of that series may be presented or surrendered for payment, where Securities of that series may be surrendered for registration of transfer or exchange, where Securities of that series that are convertible or exchangeable may be surrendered for conversion or exchange, as applicable and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served.

If Securities of a series are issuable as Bearer Securities, the Company will maintain (A) in The City of New York, an office or agency where any Registered Securities of that series may be presented or surrendered for payment, where any Registered Securities of that series may be surrendered for registration of transfer, where Securities of that series may be surrendered for exchange, where Securities of that series that are convertible or exchangeable may be surrendered for conversion or exchange, as applicable, where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served and where Bearer Securities of that series and related coupons may be presented or surrendered for payment in the circumstances described in the following paragraph (and not otherwise) (B) subject to any laws or regulations applicable thereto, in a Place of Payment for that series which is located outside the United States, an office or agency where Securities of that series and related coupons may be presented and surrendered for payment; provided , however , that, if the Securities of that series are listed on any stock exchange located outside the United States and such stock exchange shall so require, the Company will maintain a Paying Agent for the Securities of that series in any required city located outside the United States so long as the Securities of that series are listed on such exchange, and (C) subject to any laws or regulations applicable thereto, in a Place of Payment for that series located outside the United States an office or agency where any Registered Securities of that series may be surrendered for registration of transfer, where Securities of that series may be surrendered for exchange, where Securities of that series that are convertible and exchangeable may be surrendered for conversion or exchange, as applicable and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served.

The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, except that Bearer Securities of any series and the related coupons may be presented and surrendered for payment at the offices specified in the Security, in London, and the Company hereby appoints the same as its agents to receive such respective presentations, surrenders, notices and demands.

Unless otherwise specified with respect to any Securities pursuant to Section 301, no payment of principal, premium or interest on Bearer Securities shall be made at any office or agency of the Company in the United States or by check mailed to any address in the United States or by transfer to an account maintained with a bank located in the United States; provided , however , that, if the Securities of a series are payable in Dollars, payment of principal of (and premium, if any) and interest, if any, on any Bearer Security shall be made at the office of the Company's Paying Agent in The City of New York, if (but only if) payment in Dollars of the full amount of such principal, premium or interest, as the case may be, at all offices or agencies outside the United States maintained for such purpose by the Company in accordance with this Indenture is illegal or effectively precluded by exchange controls or other similar restrictions.

The Company may also from time to time designate one or more other offices or agencies where the Securities of one or more series may be presented or surrendered for any or all such purposes and may from time to time rescind any such designation; provided , however , that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in accordance with the requirements set forth above for Securities of any series for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency. Unless otherwise specified with respect to any Securities as contemplated by Section 301 with respect to a series of Securities, the Company hereby designates as a Place of Payment for each series of Securities the office or agency of the Company in the Borough of Manhattan, The City of New York, and initially appoints the Trustee at its Corporate Trust Office as Paying Agent in such city and as its agent to receive all such presentations, surrenders, notices and demands.

Unless otherwise specified with respect to any Securities pursuant to Section 301, if and so long as the Securities of any series (i) are denominated in a Currency other than Dollars or (ii) may be payable in a Currency other than Dollars, or so long as it is required under any other provision of the Indenture, then the Company will maintain with respect to each such series of Securities, or as so required, at least one Exchange Rate Agent.

SECTION 1003. Money for Securities Payments to Be Held in Trust.

If the Company shall at any time act as its own Paying Agent with respect to any series of Securities and any related coupons, it will, on or before each due date of the principal of (or premium, if any) or interest, if any, on any of the Securities of that series, segregate and hold in trust for the benefit of the Persons entitled thereto a sum in the Currency in which the Securities of such series are payable (except as otherwise specified pursuant to Section 301 for the Securities of such series and except, if applicable, as provided in Sections 312(b), 312(d) and 312(e)) sufficient to pay the principal of (or premium, if any) or interest, if any, on Securities of such series so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act.

Whenever the Company shall have one or more Paying Agents for any series of Securities and any related coupons, it will, prior to or on each due date of the principal of (or premium, if any) or interest, if any, on any Securities of that series, deposit with a Paying Agent a sum (in the Currency described in the preceding paragraph) sufficient to pay the principal (or premium, if any) or interest, if any, so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal, premium or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act.

The Company will cause each Paying Agent (other than the Trustee) for any series of Securities to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will:

(1) hold all sums held by it for the payment of the principal of (and premium, if any) and interest, if any, on Securities of such series in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided;

(2) give the Trustee notice of any default by the Company (or any other obligor upon the Securities of such series) in the making of any payment of principal of (or premium, if any) or interest, if any, on the Securities of such series; and

(3) at any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such Paying Agent.

The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such sums.

Except as provided in the Securities of any series, any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of (or premium, if any) or interest, if any, on any Security of any series, or any coupon appertaining thereto, and remaining unclaimed for two years (or such shorter period as may be specified in the applicable abandoned property statutes) after such principal, premium or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security or coupon shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided , however , that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in an Authorized Newspaper, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company.

SECTION 1004. Statement as to Compliance and Notice of Default.

The Company will deliver to the Trustee, within 120 days after the end of each fiscal year, a brief certificate from the principal executive officer, principal financial officer or principal accounting officer as to his or her knowledge of the Company's compliance with all conditions and covenants under this Indenture. For purposes of this Section 1004, such compliance shall be determined without regard to any period of grace or requirement of notice under this Indenture. Upon becoming aware of any Event of Default, the Company will notify the Trustee as soon as practicable.

SECTION 1005. Additional Amounts.

Unless otherwise provided in Section 301 for Securities of any series, all payments made by the Company under or with respect to the Securities will be made free and clear of and without withholding or deduction for or on account of any present or future tax, duty, levy, impost, assessment or other governmental charge (including penalties, interest and other liabilities related thereto) imposed or levied by or on behalf of the Government of Canada or of any province or territory thereof or by any authority or agency therein or thereof having power to tax (hereinafter " Canadian Taxes "), unless the Company is required to withhold or deduct Canadian Taxes by law or by the interpretation or administration thereof. If the Company is so required to withhold or deduct any amount for or on account of Canadian Taxes from any payment made under or with respect to the Securities, the Company will pay to each Holder as additional interest such additional amounts (" Additional Amounts ") as may be necessary so that the net amount received by each Holder after such withholding or deduction (and after deducting any Canadian Taxes on such Additional Amounts) will not be less than the amount the Holder would have received if such Canadian Taxes had not been withheld or deducted. However, no Additional Amounts will be payable with respect to a payment made to a Holder (such Holder, an " Excluded Holder ") in respect of the beneficial owner thereof:

(i): with which the Company does not deal at arm's length (within the meaning of the Income Tax Act (Canada)) at the time of making such payment;
(ii): which is subject to such Canadian Taxes by reason of the Holder being a resident, domicile or national of, or engaged in business or maintaining a permanent establishment or other physical presence in or otherwise having some connection with Canada or any province or territory thereof otherwise than by the mere holding of Securities or the receipt of payments thereunder; or
(iii): which is subject to such Canadian Taxes by reason of the Holder's failure to comply with any certification, identification, information, documentation or other reporting requirements if compliance is required by law, regulation, administrative practice or an applicable treaty as a precondition to exemption from, or a reduction in the rate of deduction or withholding of, such Canadian Taxes.

The Company will also:

(i): make such withholding or deduction; and
(ii): remit the full amount deducted or withheld to the relevant authority in accordance with applicable law.

The Company will furnish to the Holders of the Securities, within 60 days after the date the payment of any Canadian Taxes is due pursuant to applicable law, certified copies of tax receipts or other documents evidencing such payment by the Company.

The Company will indemnify and hold harmless each Holder (other than an Excluded Holder) and upon written request reimburse each such Holder for the amount, excluding any payment of Additional Amounts by the Company, of:

(i): any Canadian Taxes so levied or imposed and paid by such Holder as a result of payments made under or with respect to the Securities;
(ii): any liability (including penalties, interest and expenses) arising therefrom or with respect thereto; and
(iii): any Canadian Taxes imposed with respect to any reimbursement under clause (i) or (ii) in this paragraph, but excluding any such Canadian Taxes on such Holder's net income.

Wherever in this Indenture there is mentioned, in any context, the payment of principal (and premium, if any), interest or any other amount payable under or with respect to a Security, such mention shall be deemed to include mention of the payment of Additional Amounts to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof.

SECTION 1006. Payment of Taxes and Other Claims.

The Company will pay or discharge or cause to be paid or discharged, before the same shall become delinquent, (1) all material taxes, assessments and governmental charges levied or imposed upon the Company or any Restricted Subsidiary or upon the income, profits or Property of the Company or any Restricted Subsidiary, and (2) all material lawful claims for labor, materials and supplies which, if unpaid, might by law become a Lien upon any Property of the Company or any Restricted Subsidiary; provided , however , that the Company shall not be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings.

SECTION 1007. To Carry on Business.

The Company will itself or through its Subsidiaries carry on its business in accordance with ordinary industry practice (which may include carrying on business in partnership), will keep or cause to be kept proper books of account in relation to its business and the business of its Subsidiaries, as the case may be, and, subject to the other provisions of this Indenture, will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence, and will not consolidate, amalgamate or merge with any other corporation or transfer its undertaking and Property as an entirety or substantially as an entirety to any other Person, except in compliance with the provisions of Article Eight; provided , however , that nothing herein contained shall prevent the Company from ceasing to carry on any portion of its business (but not substantially all of its business) or from ceasing to operate any premises or Property if it shall be advisable and in the best interests of the Company.

SECTION 1008. Corporate Existence.

Subject to Article Eight, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the rights (charter and statutory) and franchises of the Company and any Restricted Subsidiary; provided , however , that the Company shall not be required to preserve any such right or franchise if the Company shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and its Subsidiaries as a whole.

SECTION 1009. Limitation on Liens.

So long as any of the Securities are outstanding, the Company will not, and will not permit any Restricted Subsidiary to, create, incur or assume any Lien on or over any present or future Property securing any Debt of the Company or a Restricted Subsidiary without also simultaneously or prior thereto securing, or causing such Restricted Subsidiary to secure, equally and ratably with such other Debt all of the Securities then Outstanding under this Indenture, except:

(i): Liens existing as of the date of this Indenture;
(ii): any Purchase Money Mortgage;
(iii): Liens on any property in favor of any federal government or any province, state or territory thereof or any municipality therein or any political subdivision, department, agency or instrumentality of any of them to secure the performance of any covenant or obligation to or in favor of or entered into at the request of such authorities where such security is required pursuant to any contract, statute or regulation or with respect to any franchise, grant, license or permit and any defects in title in structures or other facilities arising solely from the fact that such structures or facilities are constructed or installed on lands held by the Company under government permits, leases or other grants;
(iv): Liens on any property or any interest therein to secure all or any part of the costs incurred after the date of this Indenture for surveying, exploration, extraction, drilling, development, construction, alteration, repair or improvement of or on such property;
(v): Liens on any oil and/or gas property or products derived from such property to secure obligations incurred or guarantees of obligations incurred in connection with or necessarily incidental to commitments of purchase or sale of, or the transportation, storage or distribution of, such property or the products derived from such property;
(vi): Liens existing on properties when acquired, provided that such Liens were not incurred in anticipation of such acquisition;

(vii): Liens existing on property of a person when such person becomes a Restricted Subsidiary, or arising thereafter pursuant to contractual commitments entered into prior to and not in contemplation of such person becoming a Restricted Subsidiary, or is merged into or amalgamated or consolidated with the Company or a Restricted Subsidiary or such property is otherwise acquired by the Company or a Restricted Subsidiary or when given in compliance with obligations under trust deeds and similar instruments entered into prior to their becoming Restricted Subsidiaries or being merged into or amalgamated or consolidated with the Company or such property is otherwise acquired, provided such Liens do not attach to property owned by the Company or owned by a Restricted Subsidiary prior to such merger, amalgamation or consolidation;
(viii): Liens arising under partnership agreements, oil and natural gas leases, overriding royalty agreements, net profits agreements, royalty trust agreements, master limited partnership agreements, farm-out agreements, division orders, unitization and pooling designations, declarations, orders and agreements, development agreements, operating agreements, production sales contracts (including security in respect of take or pay or similar obligations thereunder), area of mutual interest agreements, natural gas balancing or deferred production agreements, injection, repressuring and recycling agreements, salt water or other disposal agreements, seismic or geophysical permits or agreements, which in each of the foregoing cases is customary in the oil and natural gas business, and other similar agreements which are customary in the oil and natural gas business, provided in all instances that such Lien is limited to the assets that are the subject of the relevant agreement;
(ix): Liens incurred or arising by operation of law;
(x): Liens incurred in connection with Debt which by its terms is non-recourse to the Company or any Restricted Subsidiary;
(xi): Liens in favor of the Company or any Restricted Subsidiary;
(xii): Liens on Current Assets to secure Debt repayable on demand or maturing within 12 months of the date when such Debt is incurred or the date of any renewal or extension thereof provided that such security is given at the time that the Debt is incurred;
(xiii): Liens granted in the ordinary course of business in connection with Financial Instrument Obligations;
(xiv): any Lien on Debt issued by the Company or any of its Subsidiaries and owed to the Company or any of its Subsidiaries in favor of a trustee or other collateral agent, for the benefit of holders of publicly issued Debt of the Company that is issued in connection with, at the same time and in the same principal amount as such Debt;
(xv): any extension, renewal, alteration, refinancing, replacement, exchange or refunding (or successive extensions, renewals, alterations, refinancings, replacements, exchanges or refundings) of all or part of any Lien referred to in the foregoing clauses; provided , however , that (A) such new Lien shall be limited to all or part of the property which is secured by the Lien plus improvements on such property and (B) the Debt secured by the new Lien is not increased from the amount of the Debt then existing at the time of such extension, renewal, alteration, refinancing, replacement, exchange or refunding, plus an amount necessary to pay fees and expenses, including premiums, related to such extensions; and

(xvi): Liens that would otherwise be prohibited by the foregoing clauses, provided that the aggregate Debt outstanding and secured pursuant to this clause does not at the time of granting the Lien exceed an amount equal to 10% of Consolidated Net Tangible Assets.

SECTION 1010. Waiver of Certain Covenants.

The Company may, with respect to any series of Securities, omit in any particular instance to comply with any term, provision or condition which affects such series set forth in Section 803 or Sections 1006 to 1009, inclusive, or, as specified pursuant to Section 301(15) for Securities of such series, in any covenants of the Company added to Article Ten pursuant to Section 301(14) or Section 301(15) in connection with Securities of such series, if before the time for such compliance the Holders of at least a majority in principal amount of all Outstanding Securities of any series, by Act of such Holders, waive such compliance in such instance with such term, provision or condition, but no such waiver shall extend to or affect such term, provision or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of the Trustee to Holders of Securities of such series in respect of any such term, provision or condition shall remain in full force and effect.

SECTION 1011. Calculation of Original Issue Discount.

If any Securities are Original Issue Discount Securities, then the Company shall file with the Trustee promptly at the end of each calendar year (i) a written notice specifying the amount of original issue discount (including daily rates and accrual periods) accrued on Outstanding Securities as of the end of such year and (ii) such other specified information relating to such original issue discount as may then be relevant under the Internal Revenue Code of 1986, as amended from time to time.

ARTICLE ELEVEN

REDEMPTION OF SECURITIES

SECTION 1101. Applicability of Article.

Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with the terms of such Securities and (except as otherwise specified as contemplated by Section 301 for Securities of any series) in accordance with this Article.

SECTION 1102. Election to Redeem; Notice to Trustee.

The election of the Company to redeem any Securities shall be evidenced by or pursuant to a Board Resolution. In case of any redemption at the election of the Company, the Company shall, at least 60 days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date and of the principal amount of Securities of such series to be redeemed and shall deliver to the Trustee such documentation and records as shall enable the Trustee to select the Securities to be redeemed pursuant to Section 1103. In the case of any redemption of Securities prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company shall furnish the Trustee with an Officers' Certificate evidencing compliance with such restriction.

SECTION 1103. Selection by Trustee of Securities to Be Redeemed.

If less than all the Securities of any series are to be redeemed, the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series not previously called for redemption, by such method as the Trustee shall deem fair and appropriate and which may provide for the selection for redemption of portions of the principal of Securities of such series; provided , however , that no such partial redemption shall reduce the portion of the principal amount of a Security not redeemed to less than the minimum authorized denomination for Securities of such series established pursuant to Section 301.

The Trustee shall promptly notify the Company in writing of the Securities selected for redemption and, in the case of any Securities selected for partial redemption, the principal amount thereof to be redeemed.

For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities shall relate, in the case of any Security redeemed or to be redeemed only in part, to the portion of the principal amount of such Security which has been or is to be redeemed.

SECTION 1104. Notice of Redemption.

Except as otherwise specified as contemplated by Section 301, notice of redemption shall be given in the manner provided for in Section 106 not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Securities to be redeemed. Failure to give notice in the manner provided in Section 106 to the Holder of any Securities designated for redemption as a whole or in part, or any defect in the notice to any such Holder, shall not affect the validity of the proceedings for the redemption of any other Securities or portion thereof.

All notices of redemption shall state:

(1) the Redemption Date,

(2) the Redemption Price and the amount of accrued interest to the Redemption Date payable as provided in Section 1106, if any,

(3) if less than all the Outstanding Securities of any series are to be redeemed, the identification (and, in the case of partial redemption, the principal amounts) of the particular Securities to be redeemed,

(4) in case any Security is to be redeemed in part only, the notice which relates to such Security shall state that on and after the Redemption Date, upon surrender of such Security, the holder will receive, without charge, a new Security or Securities of authorized denominations for the principal amount thereof remaining unredeemed,

(5) that on the Redemption Date, the Redemption Price and accrued interest, if any, to the Redemption Date payable as provided in Section 1106 will become due and payable upon each such Security, or the portion thereof, to be redeemed and, if applicable, that interest thereon will cease to accrue on and after said date,

(6) the Place or Places of Payment where such Securities, together in the case of Bearer Securities with all coupons appertaining thereto, if any, maturing after the Redemption Date, are to be surrendered for payment of the Redemption Price and accrued interest, if any,

(7) that the redemption is for a sinking fund, if such is the case,

(8) that, unless otherwise specified in such notice, Bearer Securities of any series, if any, surrendered for redemption must be accompanied by all coupons maturing subsequent to the Redemption Date or the amount of any such missing coupon or coupons will be deducted from the Redemption Price unless security or indemnity satisfactory to the Company, the Trustee and any Paying Agent is furnished, and

(9) if Bearer Securities of any series are to be redeemed and any Registered Securities of such series are not to be redeemed, and if such Bearer Securities may be exchanged for Registered Securities not subject to redemption on such Redemption Date pursuant to Section 305 or otherwise, the last date, as determined by the Company, on which such exchanges may be made.

Notice of redemption of Securities to be redeemed at the election of the Company shall be given by the Company or, at the Company's request, by the Trustee in the name and at the expense of the Company.

SECTION 1105. Deposit of Redemption Price.

Prior to any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 1003) an amount of money in the Currency in which the Securities of such series are payable (except as otherwise specified pursuant to Section 301 for the Securities of such series and except, if applicable, as provided in Sections 312(b), 312(d) and 312(e)) sufficient to pay the Redemption Price of, and accrued interest, if any, on, all the Securities which are to be redeemed on that date.

SECTION 1106. Securities Payable on Redemption Date.

Notice of redemption having been given as aforesaid, the Securities so to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified in the Currency in which the Securities of such series are payable (except as otherwise specified pursuant to Section 301 for the Securities of such series and except, if applicable, as provided in Sections 312(b), 312(d) and 312(e)) (together with accrued interest, if any, to the Redemption Date), and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued interest, if any) such Securities shall, if the same were interest-bearing, cease to bear interest and the coupons for such interest appertaining to any Bearer Securities so to be redeemed, except to the extent provided below, shall be void. Upon surrender of any such Security for redemption in accordance with said notice, together with all coupons, if any, appertaining thereto maturing after the Redemption Date, such Security shall be paid by the Company at the Redemption Price, together with accrued interest, if any, to the Redemption Date; provided , however , that installments of interest on Bearer Securities whose Stated Maturity is on or prior to the Redemption Date shall be payable only at an office or agency located outside the United States (except as otherwise provided in Section 1002) and, unless otherwise specified as contemplated by Section 301, only upon presentation and surrender of coupons for such interest; and provided further that installments of interest on Registered Securities whose Stated Maturity is on or prior to the Redemption Date shall be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 307.

If any Bearer Security surrendered for redemption shall not be accompanied by all appurtenant coupons maturing after the Redemption Date, such Security may be paid after deducting from the Redemption Price an amount equal to the face amount of all such missing coupons, or the surrender of such missing coupon or coupons may be waived by the Company and the Trustee if there be furnished to them such security or indemnity as they may require to save each of them and any Paying Agent harmless. If thereafter the Holder of such Security shall surrender to the Trustee or any Paying Agent any such missing coupon in respect of which a deduction shall have been made from the Redemption Price, such Holder shall be entitled to receive the amount so deducted; provided , however , that interest represented by coupons shall be payable only at an office or agency located outside the United States (except as otherwise provided in Section 1002) and, unless otherwise specified as contemplated by Section 301, only upon presentation and surrender of those coupons.

If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal (and premium, if any) shall, until paid, bear interest from the Redemption Date at the rate of interest or Yield to Maturity (in the case of Original Issue Discount Securities) set forth in such Security.

SECTION 1107. Securities Redeemed in Part.

Any Security which is to be redeemed only in part (pursuant to the provisions of this Article or of Article Twelve) shall be surrendered at a Place of Payment therefor (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder's attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities of the same series, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered.

SECTION 1108. Tax Redemption.

Unless otherwise specified pursuant to Section 301, the Company shall have the right to redeem, in whole but not in part, at a redemption price equal to the principal amount thereof together with accrued and unpaid interest to the date fixed for redemption, upon the giving of a notice as described below, if the Company (or its successor) determines that (i) as a result of (A) any amendment to or change (including any announced prospective change) in the laws (or any regulations thereunder) of Canada (or the jurisdiction of organization of the Company's successor) or of any political subdivision or taxing authority thereof or therein, as applicable, or (B) any amendment to or change in an interpretation or application of such laws or regulations by any legislative body, court, governmental agency or regulatory authority (including the enactment of any legislation and the publication of any judicial decision or regulatory determination), which amendment or change is announced or becomes effective on or after a date specified pursuant to Section 301, if any date is so specified, or the date a party organized in a jurisdiction other than Canada or the United States becomes the Company's successor, the Company has or will become obligated to pay, on the next succeeding date on which interest is due, Additional Amounts pursuant to Section 1005, or (ii) on or after a date specified pursuant to Section 301, if any date is so specified, or the date a party organized in a jurisdiction other than Canada or the United States becomes the Company's successor, any action has been taken by any taxing authority of, or any decision has been rendered by a court of competent jurisdiction in Canada (or the jurisdiction of organization of the Company's successor) or any political subdivision or taxing authority thereof or therein, including any of those actions specified in (i) above, whether or not such action was taken or decision was rendered with respect to the Company, or any change, amendment, application or interpretation shall be officially proposed, which, in any such case, in the Opinion of Counsel to the Company, will result in the Company becoming obligated to pay, on the next succeeding date on which interest is due, Additional Amounts with respect to any Security of such series; provided , however , that (a) no such notice of redemption may be given earlier than 60 or later than 30 days prior to the earliest date on which the Company would be obligated to pay such Additional Amounts were a payment in respect of the Securities then due, and (b) at the time such notice of redemption is given, such obligation to pay such Additional Amounts remains in effect.

ARTICLE TWELVE

SINKING FUNDS

SECTION 1201. Applicability of Article.

Retirements of Securities of any series pursuant to any sinking fund shall be made in accordance with the terms of such Securities and (except as otherwise specified as contemplated by Section 301 for Securities of any series) in accordance with this Article.

The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a " mandatory sinking fund payment ", and any payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an " optional sinking fund payment ". If provided for by the terms of Securities of any series, the cash amount of any mandatory sinking fund payment may be subject to reduction as provided in Section 1202. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series.

SECTION 1202. Satisfaction of Sinking Fund Payments with Securities.

Subject to Section 1203, in lieu of making all or any part of any mandatory sinking fund payment with respect to any Securities of a series in cash, the Company may at its option (1) deliver to the Trustee Outstanding Securities of a series (other than any previously called for redemption) theretofore purchased or otherwise acquired by the Company together in the case of any Bearer Securities of such series with all unmatured coupons appertaining thereto, and/or (2) receive credit for the principal amount of Securities of such series which have been previously delivered to the Trustee by the Company or for Securities of such series which have been redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any mandatory sinking fund payment with respect to the Securities of the same series required to be made pursuant to the terms of such Securities as provided for by the terms of such series; provided , however , that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for redemption through operation of the sinking fund and the amount of such mandatory sinking fund payment shall be reduced accordingly.

SECTION 1203. Redemption of Securities for Sinking Fund.

Not less than 60 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officers' Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of cash in the Currency in which the Securities of such series are payable (except as otherwise specified pursuant to Section 301 for the Securities of such series and except, if applicable, as provided in Sections 312(b), 312(d) and 312(e)) and the portion thereof, if any, which is to be satisfied by delivering or crediting Securities of that series pursuant to Section 1202 (which Securities will, if not previously delivered, accompany such certificate) and whether the Company intends to exercise its right to make a permitted optional sinking fund payment with respect to such series. Such certificate shall be irrevocable and upon its delivery the Company shall be obligated to make the cash payment or payments therein referred to, if any, on or before the next succeeding sinking fund payment date. In the case of the failure of the Company to deliver such certificate, the sinking fund payment due on the next succeeding sinking fund payment date for that series shall be paid entirely in cash and shall be sufficient to redeem the principal amount of such Securities subject to a mandatory sinking fund payment without the option to deliver or credit Securities as provided in Section 1202 and without the right to make any optional sinking fund payment, if any, with respect to such series.

Not more than 60 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 1103 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 1104. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections 1106 and 1107.

Prior to any sinking fund payment date, the Company shall pay to the Trustee or a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 1003) in cash a sum equal to any interest that will accrue to the date fixed for redemption of Securities or portions thereof to be redeemed on such sinking fund payment date pursuant to this Section 1203.

Notwithstanding the foregoing, with respect to a sinking fund for any series of Securities, if at any time the amount of cash to be paid into such sinking fund on the next succeeding sinking fund payment date, together with any unused balance of any preceding sinking fund payment or payments for such series, does not exceed in the aggregate $100,000, the Trustee, unless requested by the Company, shall not give the next succeeding notice of the redemption of Securities of such series through the operation of the sinking fund. Any such unused balance of moneys deposited in such sinking fund shall be added to the sinking fund payment for such series to be made in cash on the next succeeding sinking fund payment date or, at the request of the Company, shall be applied at any time or from time to time to the purchase of Securities of such series, by public or private purchase, in the open market or otherwise, at a purchase price for such Securities (excluding accrued interest and brokerage commissions, for which the Trustee or any Paying Agent will be reimbursed by the Company) not in excess of the principal amount thereof.

ARTICLE THIRTEEN

REPAYMENT AT OPTION OF HOLDERS

SECTION 1301. Applicability of Article.

Repayment of Securities of any series before their Stated Maturity at the option of Holders thereof shall be made in accordance with the terms of such Securities and (except as otherwise specified as contemplated by Section 301 for Securities of any series) in accordance with this Article.

SECTION 1302. Repayment of Securities.

Securities of any series subject to repayment in whole or in part at the option of the Holders thereof will, unless otherwise provided in the terms of such Securities, be repaid at a price equal to the principal amount thereof, together with interest, if any, thereon accrued to the Repayment Date specified in or pursuant to the terms of such Securities. The Company covenants that on or before the Repayment Date it will deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 1003) an amount of money in the Currency in which the Securities of such series are payable (except as otherwise specified pursuant to Section 301 for the Securities of such series and except, if applicable, as provided in Sections 312(b), 312(d) and 312(e)) sufficient to pay the principal (or, if so provided by the terms of the Securities of any series, a percentage of the principal) of and (except if the Repayment Date shall be an Interest Payment Date) accrued interest, if any, on, all the Securities or portions thereof, as the case may be, to be repaid on such date.

SECTION 1303. Exercise of Option.

Securities of any series subject to repayment at the option of the Holders thereof will contain an "Option to Elect Repayment" form on the reverse of such Securities. To be repaid at the option of the Holder, any Security so providing for such repayment, with the "Option to Elect Repayment" form on the reverse of such Security duly completed by the Holder (or by the Holder's attorney duly authorized in writing), must be received by the Company at the Place of Payment therefor specified in the terms of such Security (or at such other place or places or which the Company shall from time to time notify the Holders of such Securities) not earlier than 45 days nor later than 30 days prior to the Repayment Date. If less than the entire principal amount of such Security is to be repaid in accordance with the terms of such Security, the principal amount of such Security to be repaid, in increments of the minimum denomination for Securities of such series, and the denomination or denominations of the Security or Securities to be issued to the Holder for the portion of the principal amount of such Security surrendered that is not to be repaid, must be specified. The principal amount of any Security providing for repayment at the option of the Holder thereof may not be repaid in part if, following such repayment, the unpaid principal amount of such Security would be less than the minimum authorized denomination of Securities of the series of which such Security to be repaid is a part. Except as otherwise may be provided by the terms of any Security providing for repayment at the option of the Holder thereof, exercise of the repayment option by the Holder shall be irrevocable unless waived by the Company.

SECTION 1304. When Securities Presented for Repayment Become Due and Payable.

If Securities of any series providing for repayment at the option of the Holders thereof shall have been surrendered as provided in this Article and as provided by or pursuant to the terms of such Securities, such Securities or the portions thereof, as the case may be, to be repaid shall become due and payable and shall be paid by the Company on the Repayment Date therein specified, and on and after such Repayment Date (unless the Company shall default in the payment of such Securities on such Repayment Date) such Securities shall, if the same were interest-bearing, cease to bear interest and the coupons for such interest appertaining to any Bearer Securities so to be repaid, except to the extent provided below, shall be void. Upon surrender of any such Security for repayment in accordance with such provisions, together with all coupons, if any, appertaining thereto maturing after the Repayment Date, the principal amount of such Security so to be repaid shall be paid by the Company, together with accrued interest, if any, to the Repayment Date; provided , however , that coupons whose Stated Maturity is on or prior to the Repayment Date shall be payable only at an office or agency located outside the United States (except as otherwise provided in Section 1002) and, unless otherwise specified pursuant to Section 301, only upon presentation and surrender of such coupons; and provided further that, in the case of Registered Securities, installments of interest, if any, whose Stated Maturity is on or prior to the Repayment Date shall be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 307.

If any Bearer Security surrendered for repayment shall not be accompanied by all appurtenant coupons maturing after the Repayment Date, such Security may be paid after deducting from the amount payable therefor as provided in Section 1302 an amount equal to the face amount of all such missing coupons, or the surrender of such missing coupon or coupons may be waived by the Company and the Trustee if there be furnished to them such security or indemnity as they may require to save each of them and any Paying Agent harmless. If thereafter the Holder of such Security shall surrender to the Trustee or any Paying Agent any such missing coupon in respect of which a deduction shall have been made as provided in the preceding sentence, such Holder shall be entitled to receive the amount so deducted; provided , however , that interest represented by coupons shall be payable only at an office or agency located outside the United States (except as otherwise provided in Section 1002) and, unless otherwise specified as contemplated by Section 301, only upon presentation and surrender of those coupons.

If the principal amount of any Security surrendered for repayment shall not be so repaid upon surrender thereof, such principal amount (together with interest, if any, thereon accrued to such Repayment Date) shall, until paid, bear interest from the Repayment Date at the rate of interest or Yield to Maturity (in the case of Original Issue Discount Securities) set forth in such Security.

SECTION 1305. Securities Repaid in Part.

Upon surrender of any Registered Security which is to be repaid in part only, the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Security, without service charge and at the expense of the Company, a new Registered Security or Securities of the same series, of any authorized denomination specified by the Holder, in an aggregate principal amount equal to and in exchange for the portion of the principal of such Security so surrendered which is not to be repaid.

ARTICLE FOURTEEN

DEFEASANCE AND COVENANT DEFEASANCE

SECTION 1401. Company's Option to Effect Defeasance or Covenant Defeasance.

Except as otherwise specified as contemplated by Section 301 for Securities of any series, the provisions of this Article Fourteen shall apply to each series of Securities, and the Company may, at its option, effect defeasance of the Securities of or within a series under Section 1402, or covenant defeasance of or within a series under Section 1403 in accordance with the terms of such Securities and in accordance with this Article.

SECTION 1402. Defeasance and Discharge.

Upon the Company's exercise of the above option applicable to this Section with respect to any Securities of or within a series, the Company shall be deemed to have been discharged from its obligations with respect to such Outstanding Securities and any related coupons on the date the conditions set forth in Section 1404 are satisfied (hereinafter, " defeasance "). For this purpose, such defeasance means that the Company shall be deemed to have paid and discharged the entire indebtedness represented by such Outstanding Securities and any related coupons, which shall thereafter be deemed to be "Outstanding" only for the purposes of Section 1405 and the other Sections of this Indenture referred to in (A) and (B) below, and to have satisfied all its other obligations under such Securities and any related coupons and this Indenture insofar as such Securities and any related coupons are concerned (and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder: (A) the rights of Holders of such Outstanding Securities and any related coupons to receive, solely from the trust fund described in Section 1404 and as more fully set forth in such Section, payments in respect of the principal of (and premium, if any) and interest, if any, on such Securities and any related coupons when such payments are due, (B) the Company's obligations with respect to such Securities under Sections 304, 305, 306, 1002 and 1003 and with respect to the payment of Additional Amounts, if any, on such Securities as contemplated by Section 1005, (C) the rights, powers, trusts, duties and immunities of the Trustee hereunder and (D) this Article Fourteen. Subject to compliance with this Article Fourteen, the Company may exercise its option under this Section 1402 notwithstanding the prior exercise of its option under Section 1403 with respect to such Securities and any related coupons.

SECTION 1403. Covenant Defeasance.

Upon the Company's exercise of the above option applicable to this Section with respect to any Securities of or within a series, the Company shall be released from its obligations under Section 803 and Sections 1006 through 1009, and, if specified pursuant to Section 301, its obligations under any other covenant, with respect to such Outstanding Securities and any related coupons on and after the date the conditions set forth in Section 1404 are satisfied (hereinafter, " covenant defeasance "), and such Securities and any related coupons shall thereafter be deemed not to be "Outstanding" for the purposes of any direction, waiver, consent or declaration or Act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed "Outstanding" for all other purposes hereunder. For this purpose, such covenant defeasance means that, with respect to such Outstanding Securities and any related coupons, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 501(3) or Section 501(7) or otherwise, as the case may be, but, except as specified above, the remainder of this Indenture and such Securities and any related coupons shall be unaffected thereby.

SECTION 1404. Conditions to Defeasance or Covenant Defeasance.

The following shall be the conditions to application of either Section 1402 or Section 1403 to any Outstanding Securities of or within a series and any related coupons:

(1) The Company shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee satisfying the requirements of Section 607 who shall agree to comply with the provisions of this Article Fourteen applicable to it) as trust funds in trust for the purpose of making the following payments, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of such Securities and any related coupons, (A) an amount (in such Currency in which such Securities and any related coupons are then specified as payable at Stated Maturity), or (B) Government Obligations applicable to such Securities (determined on the basis of the Currency in which such Securities are then specified as payable at Stated Maturity) which through the scheduled payment of principal and interest in respect thereof in accordance with their terms will provide, not later than one day before the due date of any payment of principal of and premium, if any, and interest, if any, under such Securities and any related coupons, money in an amount, or (C) a combination thereof, sufficient, in the opinion of a nationally recognized firm of independent chartered accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or other qualifying trustee) to pay and discharge, (i) the principal of (and premium, if any) and interest, if any, on such Outstanding Securities and any related coupons on the Stated Maturity (or Redemption Date, if applicable) of such principal (and premium, if any) or installment of interest, if any, and (ii) any mandatory sinking fund payments or analogous payments applicable to such Outstanding Securities and any related coupons on the day on which such payments are due and payable in accordance with the terms of this Indenture and of such Securities and any related coupons; provided that the Trustee shall have been irrevocably instructed to apply such money or the proceeds of such Government Obligations to said payments with respect to such Securities and any related coupons. Before such a deposit, the Company may give to the Trustee, in accordance with Section 1102 hereof, a notice of its election to redeem all or any portion of such Outstanding Securities at a future date in accordance with the terms of the Securities of such series and Article Eleven hereof, which notice shall be irrevocable. Such irrevocable redemption notice, if given, shall be given effect in applying the foregoing.

(2) No Default or Event of Default with respect to such Securities or any related coupons shall have occurred and be continuing on the date of such deposit or, insofar as paragraphs (5) and (6) of Section 501 are concerned, at any time during the period ending on the 91 ^st day after the date of such deposit (it being understood that this condition shall not be deemed satisfied until the expiration of such period).

(3) Such defeasance or covenant defeasance shall not result in a breach or violation of, or constitute a default under, this Indenture or any other material agreement or instrument to which the Company is a party or by which it is bound.

(4) In the case of an election under Section 1402, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States stating that (x) the Company has received from, or there has been published by, the Internal Revenue Service a ruling, or (y) since the date of execution of this Indenture, there has been a change in the applicable U.S. federal income tax law, in either case to the effect that, and based thereon such opinion shall confirm that, the Holders of such Outstanding Securities and any related coupons will not recognize income, gain or loss for federal income tax purposes as a result of such defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such defeasance had not occurred.

(5) Notwithstanding any other provisions of this Section, such defeasance or covenant defeasance shall be effected in compliance with any additional or substitute terms, conditions or limitations in connection therewith pursuant to Section 301.

(6) The Company shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for relating to either the defeasance under Section 1402 or the covenant defeasance under Section 1403 (as the case may be) have been complied with.

(7) In the case of an election under Section 1403, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States to the effect that the Holders of such Outstanding Securities will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such covenant defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such covenant defeasance had not occurred.

(8) Either the Company has delivered to the Trustee an Opinion of Counsel in Canada or a ruling from Canada Customs and Revenue Agency to the effect that the Holders of such Outstanding Securities will not recognize income, gain or loss for Canadian federal, provincial or territorial income tax or other tax purpose as a result of such defeasance or covenant defeasance and will be subject to Canadian federal or provincial income tax and other tax on the same amounts, in the same manner and at the same times as would have been the case had such defeasance not occurred (and for the purposes of such opinion, such Canadian counsel shall assume that Holders of the Securities include Holders who are not resident in Canada).

(9) The Company is not an "insolvent person" within the meaning of the Bankruptcy and Insolvency Act (Canada) on the date of such deposit or at any time during the period ending on the 91 ^st day after the date of such deposit (it being understood that this condition shall not be deemed satisfied until the expiration of such period).

SECTION 1405. Deposited Money and Government Obligations to Be Held in Trust; Other Miscellaneous Provisions.

Subject to the provisions of the last paragraph of Section 1003, all money and Government Obligations (or other property as may be provided pursuant to Section 301) (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 1405, the "Trustee") pursuant to Section 1404 in respect of such Outstanding Securities and any related coupons shall be held in trust and applied by the Trustee, in accordance with the provisions of such Securities and any related coupons and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Holders of such Securities and any related coupons of all sums due and to become due thereon in respect of principal (and premium, if any) and interest, if any, but such money need not be segregated from other funds except to the extent required by law.

Unless otherwise specified with respect to any Security pursuant to Section 301, if, after a deposit referred to in Section 1404(1) has been made, (a) the Holder of a Security in respect of which such deposit was made is entitled to, and does, elect pursuant to Section 312(b) or the terms of such Security to receive payment in a Currency other than that in which the deposit pursuant to Section 1404(1) has been made in respect of such Security, or (b) a Conversion Event occurs as contemplated in Section 312(d) or 312(e) or by the terms of any Security in respect of which the deposit pursuant to Section 1404(1) has been made, the indebtedness represented by such Security and any related coupons shall be deemed to have been, and will be, fully discharged and satisfied through the payment of the principal of (and premium, if any) and interest, if any, on such Security as they become due out of the proceeds yielded by converting (from time to time as specified below in the case of any such election) the amount or other property deposited in respect of such Security into the Currency in which such Security becomes payable as a result of such election or Conversion Event based on the applicable Market Exchange Rate for such Currency in effect on the third Business Day prior to each payment date, except, with respect to a Conversion Event, for such Currency in effect (as nearly as feasible) at the time of the Conversion Event.

The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the Government Obligations deposited pursuant to Section 1404 or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of such Outstanding Securities and any related coupons.

Anything in this Article Fourteen to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon Company Request any money or Government Obligations (or other property and any proceeds therefrom) held by it as provided in Section 1404 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof which would then be required to be deposited to effect an equivalent defeasance or covenant defeasance, as applicable, in accordance with this Article.

SECTION 1406. Reinstatement.

If the Trustee or any Paying Agent is unable to apply any money in accordance with Section 1405 by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company's obligations under this Indenture and such Securities and any related coupons shall be revived and reinstated as though no deposit had occurred pursuant to Section 1402 or 1403, as the case may be, until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 1405; provided , however , that if the Company makes any payment of principal of (or premium, if any) or interest, if any, on any such Security or any related coupon following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities and any related coupons to receive such payment from the money held by the Trustee or Paying Agent.

ARTICLE FIFTEEN

MEETINGS OF HOLDERS OF SECURITIES

SECTION 1501. Purposes for Which Meetings May Be Called.

If Securities of a series are issuable as Bearer Securities, a meeting of Holders of Securities of such series may be called at any time and from time to time pursuant to this Article to make, give or take any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be made, given or taken by Holders of Securities of such series.

SECTION 1502. Call, Notice and Place of Meetings.

(a) The Trustee may at any time call a meeting of Holders of Securities of any series for any purpose specified in Section 1501, to be held at such time and at such place in The City of New York or in London as the Trustee shall determine. Notice of every meeting of Holders of Securities of any series, setting forth the time and the place of such meeting and in general terms the action proposed to be taken at such meeting, shall be given, in the manner provided for in Section 106, not less than 21 nor more than 180 days prior to the date fixed for the meeting.

(b) In case at any time the Company, pursuant to a Board Resolution, or the Holders of at least 10% in principal amount of the Outstanding Securities of any series shall have requested the Trustee to call a meeting of the Holders of Securities of such series for any purpose specified in Section 1501, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have made the first publication of the notice of such meeting within 21 days after receipt of such request or shall not thereafter proceed to cause the meeting to be held as provided herein, then the Company or the Holders of Securities of such series in the amount above specified, as the case may be, may determine the time and the place in The City of New York or in London for such meeting and may call such meeting for such purposes by giving notice thereof as provided in paragraph (a) of this Section.

SECTION 1503. Persons Entitled to Vote at Meetings.

To be entitled to vote at any meeting of Holders of Securities of any series, a Person shall be (1) a Holder of one or more Outstanding Securities of such series, or (2) a Person appointed by an instrument in writing as proxy for a Holder or Holders of one or more Outstanding Securities of such series by such Holder of Holders. The only Persons who shall be entitled to be present or to speak at any meeting of Holders of Securities of any series shall be the Person entitled to vote at such meeting and their counsel, any representatives of the Trustee and its counsel and any representatives of the Company and its counsel.

SECTION 1504. Quorum; Action.

The Persons entitled to vote a majority in principal amount of the Outstanding Securities of a series shall constitute a quorum for a meeting of Holders of Securities of such series; provided , however , that, if any action is to be taken at such meeting with respect to a consent or waiver which this Indenture expressly provides may be given by the Holders of not less than a specified percentage in principal amount of the Outstanding Securities of a series, the Persons entitled to vote such specified percentage in principal amount of the Outstanding Securities of such series shall constitute a quorum. In the absence of a quorum within 30 minutes of the time appointed for any such meeting, the meeting shall, if convened at the request of Holders of Securities of such series, be dissolved. In any other case the meeting may be adjourned for a period of not less than 10 days as determined by the chairman of the meeting prior to the adjournment of such meeting. In the absence of a quorum at any such adjourned meeting, such adjourned meeting may be further adjourned for a period of not less than 10 days as determined by the chairman of the meeting prior to the adjournment of such adjourned meeting. Notice of the reconvening of any adjourned meeting shall be given as provided in Section 1502(a), except that such notice need be given only once not less than five days prior to the date on which the meeting is scheduled to be reconvened. Notice of the reconvening of any adjourned meeting shall state expressly the percentage, as provided above, of the principal amount of the Outstanding Securities of such series which shall constitute a quorum.

Subject to the foregoing, at the reconvening of any meeting adjourned for lack of a quorum the Persons entitled to vote 25% in principal amount of the Outstanding Securities at the time shall constitute a quorum for the taking of any action set forth in the notice of the original meeting.

Except as limited by the proviso to Section 902, any resolution presented to a meeting or adjourned meeting duly reconvened at which a quorum is present as aforesaid may be adopted by the affirmative vote of the Holders of not less than a majority in principal amount of the Outstanding Securities of such series who have cast their votes; provided , however , that, except as limited by the proviso to Section 902, any resolution with respect to any request, demand, authorization, direction, notice, consent, waiver or other action which this Indenture expressly provides may be made, given or taken by the Holders of a specified percentage, which is less than a majority, in principal amount of the Outstanding Securities of a series may be adopted at a meeting or an adjourned meeting duly reconvened and at which a quorum is present as aforesaid by the affirmative vote of the Holders of not less than such specified percentage in principal amount of the Outstanding Securities of such series.

Any resolution passed or decision taken at any meeting of Holders of Securities of any series duly held in accordance with this Section shall be binding on all the Holders of Securities of such series and the related coupons, whether or not present or represented at the meeting.

Notwithstanding the foregoing provisions of this Section 1504, if any action is to be taken at a meeting of Holders of Securities of any series with respect to any request, demand, authorization, direction, notice, consent, waiver or other action that this Indenture expressly provides may be made, given or taken by the Holders of a specified percentage in principal amount of all Outstanding Securities affected thereby, or of the Holders of such series and one or more additional series:

(i): there shall be no minimum quorum requirement for such meeting; and
(ii): the principal amount of the Outstanding Securities of such series that vote in favor of such request, demand, authorization, direction, notice, consent, waiver or other action shall be taken into account in determining whether such request, demand, authorization, direction, notice, consent, waiver or other action has been made, given or taken under this Indenture.

SECTION 1505. Determination of Voting Rights; Conduct and Adjournment of Meetings.

(i): Notwithstanding any provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders of Securities of a series in regard to proof of the holding of Securities of such series and of the appointment of proxies and in regard to the appointment and duties of inspectors of votes, the submission and examination of proxies, certificates and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as its shall deem appropriate. Except as otherwise permitted or required by any such regulations, the holding of Securities shall be proved in the manner specified in Section 104 and the appointment of any proxy shall be proved in the manner specified in Section 104 or by having the signature of the person executing the proxy witnessed or guaranteed by any trust company, bank or banker authorized by Section 104 to certify to the holding of Bearer Securities. Such regulations may provide that written instruments appointing proxies, regular on their face, may be presumed valid and genuine without the proof specified in Section 104 or other proof.
(ii): The Trustee shall, by an instrument in writing appoint a temporary chairman of the meeting, unless the meeting shall have been called by the Company or by Holders of Securities as provided in Section 1502(b), in which case the Company or the Holders of Securities of the series calling the meeting, as the case may be, shall in like manner appoint a temporary chairman. A permanent chairman and a permanent secretary of the meeting shall be elected by vote of the Persons entitled to vote a majority in principal amount of the Outstanding Securities of such series represented at the meeting.
(iii): At any meeting each Holder of a Security of such series or proxy shall be entitled to one vote for each $1,000 principal amount of Outstanding Securities of such series held or represented by him (determined as specified in the definition of "Outstanding" in Section 101); provided , however , that no vote shall be cast or counted at any meeting in respect of any Security challenged as not Outstanding and ruled by the chairman of the meeting to be not Outstanding. The chairman of the meeting shall have no right to vote, except as a Holder of a Security of such series or proxy.
(iv): Any meeting of Holders of Securities of any series duly called pursuant to Section 1502 at which a quorum is present may be adjourned from time to time by Persons entitled to vote a majority in principal amount of the Outstanding Securities of such series represented at the meeting; and the meeting may be held as so adjourned without further notice.

SECTION 1506. Counting Votes and Recording Action of Meetings.

The vote upon any resolution submitted to any meeting of Holders of Securities of any series shall be by written ballots on which shall be subscribed the signatures of the Holders of Securities of such series or of their representatives by proxy and the principal amounts and serial numbers of the Outstanding Securities of such series held or represented by them. The permanent chairman of the meeting shall appoint two inspectors of votes who shall count all votes cast at the meeting for or against any resolution and who shall make and file with the secretary of the meeting their verified written reports in duplicate of all votes cast at the meeting. A record, at least in duplicate, of the proceedings of each meeting of Holders of Securities of any series shall be prepared by the secretary of the meeting and there shall be attached to said record the original reports of the inspectors of votes on any vote by ballot taken thereat and affidavits by one or more persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that said notice was given as provided in Section 1502 and, if applicable, Section 1504. Each copy shall be signed and verified by the affidavits of the permanent chairman and secretary of the meeting and one such copy shall be delivered to the Company, and another to the Trustee to be preserved by the Trustee, the latter to have attached thereto the ballots voted at the meeting. Any record so signed and verified shall be conclusive evidence of the matters therein stated.

This Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Indenture.

SECTION 1507. Waiver of Jury Trial.

Each of the Company and the Trustee hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Indenture, the Securities or the transactions contemplated hereby.

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, all as of the day and year first above written.

SUNCOR ENERGY INC.
By:	/s/ BART W. DEMOSKY
	Name:	Bart W. Demosky
	Title:	Vice President & Treasurer
THE BANK OF NEW YORK, as Trustee
By:	/s/ LENA AMINOVA
	Name:	Lena Aminova
	Title:	Assistant Treasurer

EXHIBIT A

FORMS OF CERTIFICATION

EXHIBIT A-1

FORM OF CERTIFICATE TO BE GIVEN BY
PERSON ENTITLED TO RECEIVE BEARER SECURITY
OR TO OBTAIN INTEREST PAYABLE PRIOR
TO THE EXCHANGE DATE

CERTIFICATE

SUNCOR ENERGY INC
% Notes due

This is to certify that as of the date hereof, and except as set forth below, the above-captioned Securities held by you for our account (i) are owned by any person(s) that is not a citizen or resident of the United States; a corporation or partnership (including any entity treated as a corporation or partnership for United States federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia unless, in the case of a partnership, Treasury Regulations provide otherwise; any estate whose income is subject to United States federal income tax regardless of its source or; a trust if (A) a United States court can exercise primary supervision over the trust's administration and one of more United States persons are authorized to control all substantial decisions of the trust or (B) a trust in existence on August 20, 1996, and treated as a United States person before this date that timely elected to continue to be treated as a United States person (" United States persons(s) "), (ii) are owned by United States person(s) that are (a) foreign branches of United States financial institutions (financial institutions, as defined in United States Treasury Regulation Section 1.165-12(c)(1)(v) are herein referred to as " financial institutions ") purchasing for their own account or for resale, or (b) United States person(s) who acquired the Securities through foreign branches of United States financial institutions and who hold the Securities through such United States financial institutions on the date hereof (and in either case (a) or (b), each such United States financial institution hereby agrees, on its own behalf or through its agent, that you may advise Suncor Energy Inc. or its agent that such financial institution will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the United States Internal Revenue Code of 1986, as amended, and the regulations thereunder), or (iii) are owned by United States or foreign financial institution(s) for purposes of resale during the restricted period (as defined in United States Treasury Regulation Section 1.163-5(c)(2)(i)(D)(7)), and, in addition, if the owner is a United States or foreign financial institution described in clause (iii) above (whether or not also described in clause (i) or (ii)), this is to further certify that such financial institution has not acquired the Securities for purposes of resale directly or indirectly to a United States person or to a person within the United States or its possessions.

A-1-1

As used herein, "United States" means the United States of America (including the states and the District of Columbia); and its "possessions" include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands.

We undertake to advise you promptly by tested telex on or prior to the date on which you intend to submit your certification relating to the above-captioned Securities held by you for our account in accordance with your Operating Procedures if any applicable statement herein is not correct on such date, and in the absence of any such notification it may be assumed that this certification applies as of such date.

This certificate excepts and does not relate to U.S.$ of such interest in the above-captioned Securities in respect of which we are not able to certify and as to which we understand an exchange for an interest in a Permanent Global Security or an exchange for and delivery of definitive Securities (or, if relevant, collection of any interest) cannot be made until we do so certify.

We understand that this certificate may be required in connection with certain tax legislation in the United States. If administrative or legal proceedings are commenced or threatened in connection with which this certificate is or would be relevant, we irrevocably authorize you to produce this certificate or a copy thereof to any interested party in such proceedings.

Dated:

[To be dated no earlier than the 15 ^th day
prior to (i) the Exchange Date or (ii) the
relevant Interest Payment Date occurring
prior to the Exchange Date, as applicable]

			[Name of Person Making Certification]
			(Authorized Signatory) Name: Title:

A-1-2

EXHIBIT A-2

FORM OF CERTIFICATE TO BE GIVEN BY EUROCLEAR AND CLEARSTREAM
IN CONNECTION WITH THE EXCHANGE OF A PORTION OF A
TEMPORARY GLOBAL SECURITY OR TO OBTAIN INTEREST
PAYABLE PRIOR TO THE EXCHANGE DATE

CERTIFICATE

SUNCOR ENERGY INC.
% Notes due

This is to certify that based solely on written certifications that we have received in writing, by tested telex or by electronic transmission from each of the persons appearing in our records as persons entitled to a portion of the principal amount set forth below (our " Member Organizations ") substantially in the form attached hereto, as of the date hereof, U.S.$ principal amount of the above-captioned Securities (i) is owned by any person(s) that is not a citizen or resident of the United States; a corporation or partnership (including any entity treated as a corporation or partnership for United States federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia unless, in the case of a partnership, Treasury Regulations provide otherwise; any estate whose income is subject to United States federal income tax regardless of its source or; a trust if (A) a United States court can exercise primary supervision over the trust's administration and one of more United States persons are authorized to control all substantial decisions of the trust or (B) a trust in existence on August 20, 1996, and treated as a United States person before this date that timely elected to continue to be treated as a United States person (" United States person(s) "), (ii) is owned by United States person(s) that are (a) foreign branches of United States financial institutions (financial institutions, as defined in U.S. Treasury Regulation Section 1.165-12(c)(1)(v) are herein referred to as " financial institutions ") purchasing for their own account or for resale, or (b) United States person(s) who acquired the Securities through foreign branches of United States financial institutions and who hold the Securities through such United States financial institutions on the date hereof (and in either case (a) or (b), each such financial institution has agreed, on its own behalf or through its agent, that we may advise Suncor Energy Inc. or its agent that such financial institution will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder), or (iii) is owned by United States or foreign financial institution(s) for purposes of resale during the restricted period (as defined in United States Treasury Regulation Section 1.163-5(c)(2)(i)(D)(7)) and, to the further effect, that financial institutions described in clause (iii) above (whether or not also described in clause (i) or (ii)) have certified that they have not acquired the Securities for purposes of resale directly or indirectly to a United States person or to a person within the United States or its possessions.

A-2-1

We further certify that (i) we are not making available herewith for exchange (or, if relevant, collection of any interest) any portion of the temporary global Security representing the above-captioned Securities excepted in the above-referenced certificates of Member Organizations and (ii) as of the date hereof we have not received any notification from any of our Member Organizations to the effect that the statements made by such Member Organizations with respect to any portion of the part submitted herewith for exchange (or, if relevant, collection of any interest) are no longer true and cannot be relied upon as of the date hereof.

We understand that this certification is required in connection with certain tax legislation in the United States. If administrative or legal proceedings are commenced or threatened in connection with which this certificate is or would be relevant, we irrevocably authorize you to produce this certificate or a copy thereof to any interested party in such proceedings.

Dated:

[To be dated no earlier than the Exchange
Date or the relevant Interest Payment Date
occurring prior to the Exchange Date, as
applicable]

		[MORGAN GUARANTY TRUST COMPANY OF NEW YORK, BRUSSELS OFFICE, as Operator of the Euroclear System] [CLEARSTREAM]
		By:	Name: Title:

A-2-2

Exhibit 7.2

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) o

THE BANK OF NEW YORK MELLON
(Exact name of trustee as specified in its charter)

New York (Jurisdiction of incorporation if not a U.S. national bank)		13-5160382 (I.R.S. employer identification no.)
One Wall Street, New York, N.Y. (Address of principal executive offices)		10286 (Zip code)

SUNCOR ENERGY INC.
(Exact name of obligor as specified in its charter)

Canada (State or other jurisdiction of incorporation or organization)		98-0343201 (I.R.S. employer identification no.)
150-6 ^th Avenue S.W., Box 2844 Calgary, Alberta Canada, T2P 3E3 (Address of principal executive offices)		(Zip code)

Debt Securities
(Title of the indenture securities)

1. General information. Furnish the following information as to the Trustee:

(a): Name and address of each examining or supervising authority to which it is subject.

Name		Address
Superintendent of Banks of the State of New York		One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223
Federal Reserve Bank of New York		33 Liberty Street, New York, N.Y. 10045
Federal Deposit Insurance Corporation		Washington, D.C. 20429
New York Clearing House Association		New York, N.Y. 10005

(b): Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R. 229.10(d).

1.: A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735).
4.: A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-154173).
6.: The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-152735).
7.: A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

SIGNATURE

Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 10th day of May, 2012.

		THE BANK OF NEW YORK MELLON
		By:	/s/ ERIKA WALKER
			Name: Erika Walker Title: Vice President

Consolidated Report of Condition of
THE BANK OF NEW YORK MELLON
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business March 31, 2012, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

ASSETS		Dollar Amounts In Thousands
Cash and balances due from depository institutions:
	Noninterest-bearing balances and currency and coin	3,021,000
	Interest-bearing balances	88,872,000
Securities:
	Held-to-maturity securities	4,819,000
	Available-for-sale securities	79,781,000
Federal funds sold and securities purchased under agreements to resell:
	Federal funds sold in domestic offices	11,000
	Securities purchased under agreements to resell	719,000
Loans and lease financing receivables:
	Loans and leases held for sale	9,000
	Loans and leases, net of unearned income	25,163,000
	LESS: Allowance for loan and lease losses	342,000
	Loans and leases, net of unearned income and allowance	24,821,000
Trading assets		4,149,000
Premises and fixed assets (including capitalized leases)		1,243,000
Other real estate owned		13,000
Investments in unconsolidated subsidiaries and associated companies		996,000
Direct and indirect investments in real estate ventures		0
Intangible assets:
	Goodwill	6,449,000
	Other intangible assets	1,575,000
Other assets		13,237,000

Total assets		229,715,000

LIABILITIES
Deposits:
	In domestic offices	94,919,000
	Noninterest-bearing	60,836,000
	Interest-bearing	34,083,000
	In foreign offices, Edge and Agreement subsidiaries, and IBFs	92,686,000
	Noninterest-bearing	3,607,000
	Interest-bearing	89,079,000
Federal funds purchased and securities sold under agreements to repurchase:
	Federal funds purchased in domestic offices	2,367,000
	Securities sold under agreements to repurchase	1,171,000
Trading liabilities		5,723,000
Other borrowed money:
	(includes mortgage indebtedness and obligations under capitalized leases)	3,138,000
Not applicable
Not applicable
Subordinated notes and debentures		3,505,000
Other liabilities		7,275,000

Total liabilities		210,784,000

EQUITY CAPITAL
Perpetual preferred stock and related surplus		0
Common stock		1,135,000
Surplus (exclude all surplus related to preferred stock)		9,658,000
Retained earnings		8,773,000
Accumulated other comprehensive income		-985,000
Other equity capital components		0
Total bank equity capital		18,581,000
Noncontrolling (minority) interests in consolidated subsidiaries		350,000
Total equity capital		18,931,000

Total liabilities and equity capital		229,715,000

I, Thomas P. Gibbons, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.

Thomas P. Gibbons,
Chief Financial Officer

We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.

Gerald L. Hassell
Catherine A. Rein
Michael J. Kowalski

Directors