Canadian Oil Sands Trust and Canadian Oil Sands Limited - s. 6.1 of Rule 13-502

Headnote

Subsidiary of issuer exempt from requirement to pay participation fee, subject to conditions.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am.

Rules Cited

OSC Rule 13-502 Fees

IN THE MATTER OF

THE SECURITIES ACT, R.S.O. 1990, C.S.5,

AS AMENDED AND

ONTARIO SECURITIES COMMISSION

RULE 13-502 FEES (the Fee Rule)

AND

IN THE MATTER OF

CANADIAN OIL SANDS TRUST AND

CANADIAN OIL SANDS LIMITED

EXEMPTION

(Section 6.1 of the Fee Rule)

WHEREAS the Director has received an application from Canadian Oil Sands Trust (the Trust) and Canadian Oil Sands Limited (COSL) for a decision pursuant to section 6.1 of the Fee Rule, exempting COSL from the requirement in section 2.2 of the Fee Rule to pay a participation fee;

AND UPON considering the Application and the recommendation of the staff of the Ontario Securities Commission;

AND WHEREAS the Trust and COSL have represented to the Director that:

1. COSL is incorporated under the laws of the Province of Alberta and maintains its registered and head office in Calgary, Alberta.

2. The Trust is an unincorporated open-ended investment trust formed under the laws of the Province of Alberta and governed by the provisions of an amended and restated trust indenture dated as of June 1, 2005 (the Trust Indenture) between Computershare Trust Company of Canada, as trustee, and COSL.

3. COSL acts as manager of the Trust pursuant to the Trust Indenture and a management agreement with Computershare Trust Company of Canada, as trustee of the Trust.

4. The Trust holds, indirectly through COSL, a 35.49% working interest in the Syncrude joint venture, which operates an oil sands project in northern Alberta.

5. COSL is authorized to issue an unlimited number of common shares and an unlimited number of preferred shares, issuable in series. Five different series of preferred shares have been designated to the date hereof. As at the date hereof, no preferred shares of COSL are issued and outstanding, and all of the issued and outstanding common shares of COSL are held by the Trust.

6. COSL has no other securities outstanding as at the date hereof except: (i) USD $943.95 million of senior notes issued on a private placement basis to purchasers in the United States; and (ii) CAD $545 million of unsecured medium term notes issued pursuant a Canadian MTN program under National Instrument 44-102 Shelf Distributions. The outstanding medium term notes are unconditionally guaranteed by the Trust. COSL obtained a receipt for a shelf prospectus for its MTN program on March 27, 2003 and thereby became a reporting issuer in Ontario.

7. The Trust and COSL are both currently reporting issuers in Ontario. To the knowledge of each of COSL and the Trust, neither COSL nor the Trust is in default of any requirements of Ontario securities legislation.

8. No securities of COSL are listed or posted for trading on any exchange or market. The trust units of the Trust are listed on the Toronto Stock Exchange. To the knowledge of each of COSL and the Trust, the Trust is not in default of any requirements of the Toronto Stock Exchange.

9. Prior to completion of an internal reorganization on December 31, 2004, the gross revenues of COSL represented less than 90% of the gross revenues of the Trust as certain revenue producing assets were held outside of COSL by a commercial holdings trust, the entire beneficial interest in which was held by the Trust and over which COSL exercised management control. Since December 31, 2004, however, the gross revenues of COSL represent more than 90% of the gross revenues of the Trust.

10. The net assets of COSL represent less than 90% of the net assets of the Trust on account of: (i) debt owed by COSL to the Trust; and (ii) a deferred royalty obligation of COSL to the Trust. Although these items do not appear on the consolidated balance sheet of the Trust as a result of consolidation, they are recorded as liabilities on the balance sheet of COSL and are sufficient in magnitude to cause the net assets of COSL to be less than 90% of the net assets of the Trust.

11. Pursuant to MRRS decision documents dated May 20, 2003 and May 21, 2003, respectively, evidencing decisions made by the Director (the 2003 Exemption Orders), COSL was exempted from, among other requirements, the requirements under Ontario securities legislation to file audited annual financial statements, unaudited interim financial statements, management's discussion and analysis related to its annual and interim financial statements, and annual information forms (together, the Financial Statement, MD&A and AIF Requirements), subject to certain conditions.

12. Although the 2003 Exemption Orders pre-date the effective date of National Instrument 51-102 Continuous Disclosure Requirements, they continue to exempt COSL from the Financial Statement, MD&A and AIF Requirements provided for in that instrument by virtue of section 13.2 thereof.

AND UPON the Director being satisfied that to do so would not be prejudicial to the public interest;

IT IS THE DECISION of the Director, pursuant to section 6.1 of the Fee Rule, that COSL is exempt from the requirement in section 2.2 of the Fee Rule to pay a participation fee in each of its financial years, for so long as:

(i) the Trust is a reporting issuer in Ontario,

(ii) the Trust has paid the participation fee applicable to the Trust under the Fee Rule,

(iii) the capitalization of COSL was included in the calculation of the Trust's participation fee, and

COSL continues to be exempt from the Financial Statement, MD&A and AIF Requirements.

DATED at Toronto on this 20th day of December, 2005.