An anonymous director reports

CANADA GROWTH FUND, GIBSON ENERGY AND VARME ENERGY ANNOUNCE STRATEGIC PARTNERSHIP TO ADVANCE CANADIAN WASTE-TO-ENERGY PROJECT

Canada Growth Fund Inc. (CGF), Gibson Energy Inc. and Varme Energy Inc. have entered a strategic partnership to accelerate the development of Canada's first waste-to-energy facility with carbon-capture technology. If successful, the project will be located on Gibson land in the Heartland area and will have the capability to process 200,000 tonnes per year of municipal solid waste, diverting residential garbage from landfill. Such waste will be received pursuant to a 15-year contract that has been entered into by Varme and the City of Edmonton.

This proposed greenfield waste-to-energy facility, which would be constructed by the partnership and operated by Gibson, would have integrated carbon-capture equipment enabling the project to incinerate municipal solid waste and produce carbon-negative electricity. A front-end engineering and design (FEED) study is under way, and a final investment decision (FID) by the partnership is planned in early 2025, with commissioning targeted in 2027.

The project supports the advancement of technologies fundamental to achieving a net-zero electricity grid across the country. Integrated waste-to-energy and carbon capture and storage (CCS) has significant potential to be replicated in municipalities across Canada and to put Canada in a position to export this expertise globally. By accelerating local waste diversion, the project will increase the supply of carbon-negative electricity in Alberta by avoiding harmful methane emissions. Governments globally, including the government of Canada and the government of Alberta, have identified rapid reductions in methane emissions as key to limiting near-term climate impacts.

The partnership will collaborate to advance the development of the flagship Heartland project. Pursuant to the terms of the partnership, should the project reach a positive FID, Gibson, CGF and Varme would have a 50-per-cent, 40-per-cent and 10-per-cent ownership interest, respectively. In addition, CGF would provide a carbon price assurance mechanism in the form of a carbon credit offtake (CCO) to purchase up to 200,000 tonnes per year of compliance-grade carbon credits generated by the project at an initial price of $85 per tonne for a term of 15 years. The project would retain the ability to sell up to 100,000 tonnes per year of carbon emission reductions into alternative carbon markets, including as bioenergy with CCS (BECCS) atmospheric carbon removal credits. The features of the proposed CCO, notably its large scale and its long-term fixed price, build on CGF's past transactions and help to derisk and accelerate private CCS investment by establishing revenue certainty for Canadian projects. The project benefits from this innovative CCO structure by having its compliance carbon credits derisked while retaining the ability to sell high-value carbon dioxide removal credits to leading corporations and brands.

About Canada Growth Fund Inc.

CGF is a $15-billion, arm's-length public investment vehicle that helps attract private capital to build Canada's clean economy by using investment instruments that absorb certain risks in order to encourage private investment in low-carbon projects, technologies, businesses and supply chains.

CGF makes strategic investments to help Canada to meet the following national economic and climate policy goals:

1. Reduce emissions and achieve Canada's climate targets;
2. Accelerate the deployment of key technologies, such as low-carbon hydrogen and CCS;
3. Scale up companies that will create jobs as well as drive productivity and clean growth across new and traditional sectors of Canada's industrial base;
4. Encourage the retention of intellectual property in Canada;
5. Capitalize on Canada's abundance of natural resources and strengthen critical supply chains to secure Canada's future economic and environmental well-being.

About Gibson Energy Inc.

Gibson is a leading liquids infrastructure company, with its principal businesses consisting of the storage, optimization, processing, and gathering of liquids and refined products. Headquartered in Calgary, Alta., Gibson's operations are located across North America, with core terminal assets in Hardisty and Edmonton, Alta., Ingleside, Tex., and a facility in Moose Jaw, Sask.

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