STP Implied valuation

As per PR from the company and some five months after that the application regarding McKay production start has been received and worked on by authorities no issues or concerns of any sort regarding the application and it's content has been reveiled or communicated back to the company. Had there been any mayor hangups, missing information or lacking information in the application surley this would have been comunicated by now. By the end of summer 2010 final approval can be expected.

In the pipe:

Closing date for the Senlac Aquisition 2nd of November. It will be nice when the company can communicate this has been finalised and that the deal in fact is done.

Detailed engineering and equipment bidding for McKay expected to commence this fall.

2009/10 winter program being prepared for Hangingstone and McKay South. Expansion opportunity at STP-McKay.

Significant exploration acreage remains at McKay, Long Lake, Hangingstone, Leismer and Kirby

Project financing options for McKay currently beeing evaluated. However Senlac's free cash flow profile (2010 estimated operating cash flow of $51 mm) will defer the need for additional sources of corporate funding until spring of 2010.

When comparing STP valuation with AOSC, that recenly was bought by PetroChina then an implied valuation of STP based on purchase price of AOSC gives STP a valuation well over 100% from STPs current SP. Remember this was before Senlac, that AOEC is expected to submit their applicaton some 6 months after STP and that their application at the earliest is expected for approval by late 2011 early 2012 thus AOSC production start well over two and a half years after STP and also not considering STPs significant explorational upside with ony some 15% explored. Of interest is that AOSC and STP MCKay is part of the very same exploratable bitumen trend. Thus the logical next step for PetroChina in order to maximise the exploration of the AOSC aquisition would be to also then move on and further ad to that very same explorable bitumen trend.

Suncor on the West, ConocoPhilips on the East side, and PetroChina both north and south of the fields owned by STP.

For more detailes pls look look at page 20 in the below presentation (September):
http://www.shpacific.com/wp-files/Presentation/STP-Presentation-2009-10.pdf

Below STPs most recenst presentation (October) and after the Senlac aquisition:
http://www.shpacific.com/wp-files/Presentation/STP-Presentation-2009-10-senlac.pdf