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Exhibit
99.1
 NORTH AMERICAN ENERGY PARTNERS INC.
 ANNUAL INFORMATION FORM
 June 20, 2008




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TABLE OF CONTENTS
  EXPLANATORY NOTES
    
    
    1Industry Data and Forecasts
    
    
    1Forward-Looking Statements
    
    
    1Non-GAAP Financial Measures
    
    
    4CORPORATE STRUCTURE
    
    
    6DESCRIPTION OF THE BUSINESS
    
    
    7History and Development of the Business
    
    
    7Our Competitive Strengths
    
    
    9Our Strategy
    
    
    11Our Operations and Segments
    
    
    12Our Markets
    
    
    15Contracts
    
    
    19PROJECTS
    
    
    21Joint Venture
    
    
    24Our Fleet and Equipment
    
    
    24Capital Expenditures
    
    
    25Competition
    
    
    26Major Suppliers
    
    
    27Seasonality
    
    
    27Laws, Regulations and Environmental Matters
    
    
    28The IPO and Reorganization
    
    
    29DESCRIPTION OF SHARE CAPITAL
    
    
    31Dividends
    
    
    32DESCRIPTION OF CERTAIN INDEBTEDNESS
    
    
    33Revolving Credit Facility
    
    
    3383/4% Senior Notes due 2011
    
    
    34Swap Agreements
    
    
    35Debt Ratings
    
    
    35DIRECTORS AND OFFICERS
    
    
    35THE BOARD AND BOARD COMMITTEES
    
    
    39(i) Audit Fees
    
    
    40(ii) Audit Related Fees
    
    
    40(iii) Tax Fees
    
    
    40(iv) All Other Fees
    
    
    40LEGAL PROCEEDINGS AND REGULATORY ACTIONS
    
    
    41INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS
    
    
    42TRANSFER AGENT AND REGISTRAR
    
    
    44MATERIAL CONTRACTS
    
    
    44RISKS AND UNCERTAINTIES
    
    
    45
 ADDITIONAL INFORMATION
    
    
    56Experts
    
    
    56Additional Information
    
    
    57Glossary
    
    
    58Audit
Committee Charter
    EXHIBIT A




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EXPLANATORY NOTES
   
 INDUSTRY DATA AND FORECASTS
   
 FORWARD-LOOKING STATEMENTS




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(a)
    
    the expected continued rapid growth of operators in the oil sands business and the benefits
to us therefrom;(b)
    
    the planned expenditures in the Canadian oil sands that will allow us to increase our
business from current projects and create opportunities for us to provide services to new
projects;(c)
    
    that acquisition opportunities will materialize that will allow us to expand our
complementary service offerings which we will be able to cross-sell with our existing
services;(d)
    
    the increase in the needs of oil sands operators for certain types of services as they expand
their operations and as new oil sands operations come on line;(e)
    
    the expectation that we will increase revenues by providing recurring services to our
existing customers;(f)
    
    our ability to generate additional heavy construction and mining, piling and pipeline
services work through our relationships with certain of our customers;(g)
    
    the success of the enhancements to our maintenance practices resulting in improved
availability through reduced repair time and increased utilization of our equipment;(h)
    
    our ability to become a competitive supplier in future projects of similar nature to the
projects we have completed;(i)
    
    the limited risk that royalty changes will cause our customers to cancel, delay or reduce the
scope of any significant mining developments;(j)
    
    the continued growth of diamond mining in Canada;(k)
    
    the strong infrastructure spending outlook in Canada;(l)
    
    the expectation that we will supply an additional 10 years of overburden removal for Canadian
Natural once our current contract expires;(m)
    
    the effect on our business or financial position as a result of future compliance with
applicable environmental laws and regulations;(n)
    
    the effect of changes in existing laws and regulations or their interpretation, more vigorous
enforcement policies of regulatory agencies or stricter or different interpretations of
existing laws and regulations requiring us to make additional material expenditures;(o)
    
    the continued tire supply shortage; and(p)
    
    the completion of the various projects referenced in this document at the anticipated or
scheduled time.
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
    
    anticipated major projects in the oil sands may not materialize;
    
    demand for our services may be adversely impacted by regulations affecting the energy
industry;
    
    failure by our customers to obtain required permits and licenses may affect the demand for
our services;
    
    changes in our customers perception of oil prices over the long-term could cause our
customers to defer, reduce or stop their investment in oil sands projects, which would, in
turn, reduce our revenue from those customers;
    
    insufficient pipeline, upgrading and refining capacity or lack of sufficient governmental
infrastructure to support growth in the oil sands region could cause our customers to delay,
reduce or cancel plans to construct new oil sands projects or expand existing projects, which
would, in turn, reduce our revenue from those customers;
    
    a change in strategy by our customers to reduce outsourcing could adversely affect our
results;
    
    cost overruns by our customers on their projects may cause our customers to terminate
future projects or expansions which could adversely affect the amount of work we receive from
those customers;
    
    because most of our customers are Canadian energy companies, a downturn in the Canadian
energy industry could result in a decrease in the demand for our services;
    
    shortages of qualified personnel or significant labor disputes could adversely affect our
business; and
    
    unanticipated short-term shutdowns of our customers operating facilities may result in
temporary cessation or cancellation of projects in which we are participating.
  
    
    our ability to grow our operations in the future may be hampered by our inability to obtain
long lead time equipment and tires, which are currently in limited supply;
    
    if we are unable to obtain surety bonds or letters of credit required by some of our
customers, our business could be impaired;
    
    we are dependent on our ability to lease equipment, and a tightening of this form of credit
could adversely affect our ability to bid for new work and/or supply some of our existing
contracts;
    
    our business is highly competitive and competitors may outbid us on major projects that are
awarded based on bid proposals;
    
    our customer base is concentrated, and the loss of or a significant reduction in business
from a major customer could adversely impact our financial condition;
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
    
    lump-sum and unit-price contracts expose us to losses when our estimates of project costs
are lower than actual costs;
    
    our operations are subject to weather-related factors that may cause delays in our project
work;
    
    environmental laws and regulations may expose us to liability arising out of our operations
or the operations of our customers; and
    
    many of our senior officers have either recently joined the company or have just been
promoted and have only worked together as a management team for a short period of time.
 There can be no assurance that forward-looking information will prove to be
accurate, as actual results and future events could differ materially from those expected or
estimated in such statements. Accordingly, readers should not place undue reliance on
forward-looking information.
 
 NON-GAAP FINANCIAL MEASURES
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CORPORATE STRUCTURE
 Name, Address and Incorporation
 Canada Business Corporations Act
  
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DESCRIPTION OF THE BUSINESS
 General
     
 History and Development of the Business
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Our Competitive Strengths
  Leading market position
  - 9 -




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Large, well-maintained equipment fleet
   Broad service offering across a projects lifecycle
  Long-term customer relationships
  Experienced management team
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Our Strategy
  Capitalize on growth opportunities in the Canadian oil sands
  Leverage our complementary services
  Increase our recurring revenue base
  Leverage long-term relationships with existing customers
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Increase our presence outside of the Canadian oil sands
  Enhance operating efficiencies to improve revenue and margins
  
 Our Operations and Segments
  (i)
    
    Heavy Construction and Mining.The services provided by this segment include surface mining
for oil sands and other natural resources, including overburden removal, hauling sand and
gravel and supplying labor and equipment to support customers mining operations; plant site
development, construction of infrastructure associated with mining operations and reclamation
activities; clearing, stripping, excavating and grading for mining operations and industrial
site construction for mega-projects; and underground utility installation for plant, refinery
and commercial building construction.(ii)
    
    Piling.The services included in this segment include installing all types of driven and
drilled piles, caissons and earth retention and stabilization systems for industrial projects
primarily focused in the oil sands and related petrochemical or refinery complexes, as well as
commercial buildings and infrastructure projects.(iii)
    
    Pipeline.The services included in this segment include installing transmission and
distribution pipe made of various materials for oil, natural gas and water.
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Year Ended March 31,2008
    
    
    2007
    
    
    2006(Dollars in thousands)Heavy construction
& mining
    
    $
    626,582
    
    
    
    63.3
    
    
    
    %
    
    
    $
    473,179
    
    
    
    75.2
    
    
    
    %
    
    
    $
    366,721
    
    
    
    74.5
    
    
    
    %Piling
    
    
    162,397
    
    
    
    16.4
    
    
    
    
    
    
    
    109,266
    
    
    
    17.3
    
    
    
    
    
    
    
    91,434
    
    
    
    18.6Pipeline
installation
    
    
    200,717
    
    
    
    20.3
    
    
    
    
    
    
    
    47,001
    
    
    
    7.5
    
    
    
    
    
    
    
    34,082
    
    
    
    6.9Total
    
    $
    989,696
    
    
    
    100.0
    
    
    
    %
    
    
    $
    629,446
    
    
    
    100.0
    
    
    
    %
    
    
    $
    492,237
    
    
    
    100.0
    
    
    
    %
 Heavy construction and mining
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Piling
    Pipeline
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Our Markets
 We provide our services in the following four markets:1.
    
    Canadian Oil Sands:Revenue generated from the construction, maintenance or operation of oil
sands extraction, upgrading or transmission facilities and infrastructure.2.
    
    Minerals Mining:Revenue generated from the construction, maintenance or operation of non
oil sands mining projects.3.
    
    Commercial and Public Construction:Revenue generated from commercial or public construction
projects.4.
    
    Conventional Oil and Gas:Revenue generated from the construction, maintenance or operation
of oil and gas transmission and/or refining facilities and infrastructure.
  
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Canadian Oil Sands
   
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Outlook
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
    
    Enbridge Inc.s proposed Gateway pipeline, which will transport oil from the oil
sands area to Kitimat, British Columbia.
    
    The proposed Access Pipeline (a joint venture between MEG Energy Corp. and Devon ARL
Canada Corp.), which will transport bitumen from the oil sands to refineries in
Edmonton, Alberta and diluents from Edmonton, Alberta to the oil sands area.
    
    TransCanada Corporations proposed Keystone pipeline project, which will transport
oil from Hardisty, Alberta to the Chicago area.
    
    The proposed Spirit pipeline system (a joint venture between Kinder Morgan and
Pembina Pipeline Corporation), which will transport condensate from Kitimat, British
Columbia to Edmonton, Alberta.
  Conventional Oil and Gas
  Minerals Mining
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Commercial and Public Construction
 
 
 Contracts
 
 1.
    
    Cost-plus:A cost-plus contract is a contract in which all work is completed based on actual
costs incurred to complete the work. These costs include all labour, equipment, materials and
any subcontractors costs. In addition to these direct costs, all site and corporate overhead
costs are charged to the job. An agreed upon fee in the form of a fixed percentage is then
applied to all costs charged to the project. This type of contract is utilized where the
project involves a large amount of risk or the scope of the project cannot be readily
determined.
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2.
    
    Time-and-materials:A time-and-materials contract involves using the components of a
cost-plus job to calculate rates for the supply of labour and equipment. In this regard, all
components of the rates are fixed and we are compensated for each hour of labour and equipment
supplied. The risk associated with this type of contract is that the estimation of the rates
and the incurrence of expenses in excess of a specific component of the agreed-upon rate. Any
cost overrun in this type of contract, must come out of the fixed margin included in the
rates.3.
    
    Unit-price:A unit-price contract is utilized in the execution of projects with large
repetitive quantities of work and is commonly utilized for site preparation, mining and
pipeline work. We are compensated for each unit of work we perform (for example, cubic meters
of earth moved, lineal meters of pipe installed or completed piles). Within the unit-price
contract, there is an allowance for labour, equipment, materials and any subcontractors
costs. Once these costs are calculated, we add any site and corporate overhead costs along
with an allowance for the margin we want to achieve. The risk associated with this type of
contract is in the calculation of the unit costs with respect to completing the required work.4.
    
    Lump sum:A lump-sum contract is utilized when a detailed scope of work is known for a
specific project. Thus, the associated costs can be readily calculated and a firm price
provided to the customer for the execution of the work. The risk lies in the fact that there
is no escalation of the price if the work takes longer or more resources are required than
were estimated in the established price, as the price is fixed regardless of the amount of
work required to complete the project.
 
 
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PROJECTS
 Current Projects
 Canadian Natural: Overburden Removal
 
 
 Syncrude: Reclamation
 
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Syncrude: Base Plant: Labour & Equipment Supply
 
 Albian: Muskeg River: Labour & Equipment Supply
 
 
 Suncor: Millennium Naphtha Unit
 
 Suncor: Voyageur
 
 
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Shell: Scotford
  Kinder Morgan: TMX Anchor Loop
  Recently Completed Projects
 DeBeers: Victor Project
   Albian: Aerodrome
  Various Subcontracts
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Joint Venture
  
 Our Fleet and Equipment
   Horsepower
    
    Number
    
    NumberCategory
    
    Capacity Range
    
    Range
    
    in Fleet
    
    LeasedHeavy construction and mining:Articulating trucks
    
    30-42 tons
    
    305-460
    
    60
    
    0Mining trucks
    
    50-330 tons
    
    650-2,700
    
    152
    
    28Shovels
    
    36-58 cubic yards
    
    2,600-3,760
    
    5
    
    3Excavators
    
    1-20 cubic yards
    
    94-1,350
    
    183
    
    20Crawler tractors
    
    N/A
    
    120-1,350
    
    147
    
    25Graders
    
    14-24 feet
    
    150-500
    
    25
    
    5Scrapers
    
    28-31 cubic yards
    
    450
    
    10
    
    0Loaders
    
    1.5-16 cubic yards
    
    110-690
    
    65
    
    0Skidsteer loaders
    
    1-2.25 cubic yards
    
    70-150
    
    55
    
    0Packers
    
    44,175-68,796 lbs
    
    216-315
    
    22
    
    0
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Horsepower
    
    Number
    
    NumberCategory
    
    Capacity Range
    
    Range
    
    in Fleet
    
    LeasedPipeline:Snow cats
    
    N/A
    
    175
    
    4
    
    0Trenchers
    
    N/A
    
    165
    
    1
    
    0Pipelayers
    
    16,000-140,000 lbs
    
    78-265
    
    59
    
    0Piling:Drill rigs
    
    60-135 feet (drill depth)
    
    210-1,500
    
    43
    
    0Cranes
    
    25-100 tons
    
    200-263
    
    14
    
    0Total
    
    
    
    
    
    845
    
    81
   
 Capital Expenditures
  Year Ended March 31,2008
    
    2007
    
    2006(Dollars in thousands)Heavy construction & mining
    
    $
    37,916
    
    
    $
    95,829
    
    
    $
    25,090Piling
    
    
    12,945
    
    
    
    8,940
    
    
    
    880Pipeline
    
    
    5,229
    
    
    
    1,918
    
    
    
    82Other
    
    
    1,689
    
    
    
    3,332
    
    
    
    2,800Total
    
    $
    57,779
    
    
    $
    110,019
    
    
    $
    28,852
 Facilities
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Lease ExpirationLocation
    
    Function
    
    Owned or Leased
    
    DateAcheson, Alberta
    
    Corporate Headquarters and major
equipment repair facility
    
    Leased
    
    11/30/2012Calgary, Alberta
    
    Regional office and major equipment
repair facility  piling operations
    
    Leased
    
    12/31/2010Calgary, Alberta
    
    Satellite office
    
    Leased
    
    month-to-monthFort McMurray, Alberta 
Syncrude Plant Site
    
    Satellite office and minor repair
facility  all operations
    
    Building Owned Land
Leased
    
    11/30/2009Fort McMurray, Alberta 
CNRL Plant Site
    
    Site office and maintenance facility
    
    Building Owned
Land Provided
    
    n/aFort McMurray, Alberta 
Aurora Mine Site
    
    Satellite office and equipment
facility  all operations
    
    Leased
    
    month-to-monthFort McMurray, Alberta 
Albian Sands Mine Site
    
    Satellite office and equipment
facility  all operations
    
    Building Leased
Land Provided
    
    month-to-monthFort McMurray, Alberta
    
    Satellite office
    
    Building Leased
    
    13 yr. term from
date of business
openingFort Nelson, British 
Columbia
    
    Satellite office  pipeline operations
    
    Leased
    
    7/10/2008Regina, Saskatchewan
    
    Regional office and equipment repair
facility  piling operations
    
    Leased
    
    3/14/2013Martensville, 
Saskatchewan
    
    Regional office and equipment repair
facility  piling operations
    
    Leased
    
    4/30/2012Calgary, Alberta
    
    Satellite office and shop for
micropile division
    
    Leased
    
    month-to-monthEdmonton, Alberta
    
    Regional office and warehouse storage
facility
    
    Leased
    
    12/31/2010Delta, British Columbia
    
    Storage facility
    
    Land Leased
    
    month-to-monthAcheson, Alberta
    
    Temporary satellite office
    
    Leased
    
    month-to-month
  
 Competition
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Major Suppliers
   
 Seasonality
  - 27 -




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Laws, Regulations and Environmental Matters
  
    
    permitting and licensing requirements applicable to contractors in their respective
trades;
    
    building and similar codes and zoning ordinances;
    
    laws and regulations relating to consumer protection; and
    
    laws and regulations relating to worker safety and protection of human health.
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Employees
  
 The IPO and Reorganization
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
    
    NACG Holdings Inc. repurchased the Series A preferred shares issued by the
pre-amalgamated North American Energy Partners Inc. for their redemption value of
$1.0 million and terminated the advisory services agreement with The Sterling Group,
L.P., Genstar Capital, L.P., Perry Strategic Capital Inc. and SF Holding Corp. (whom we
refer to collectively as the sponsors), under which we had received ongoing consulting
and advisory services with respect to the organization of the companies, employee
benefit and compensation arrangements, and other matters. We paid the sponsors a fee
of $2.0 million to terminate the agreement, which was charged to income in fiscal 2007.
Under the consulting and advisory services agreement, the sponsors also received a fee
of $0.9 million, equal to 0.5% of our aggregate gross proceeds from our IPO, which was
included in share issue costs.
    
    The $35.0 million of Series A preferred shares issued by NACG Preferred Corp. were
acquired by NACG Holdings Inc. for a $27.0 million promissory note issued to the
holders of such shares and the forfeiture of accrued dividends of $1.4 million.
    
    Each holder of the Series B preferred shares issued by the pre-amalgamated North
American Energy Partners Inc. received 100 NACG Holdings Inc. common shares for each
Series B preferred share held.
   
    
    to repurchase all of our outstanding 9% senior secured notes due 2010 for
$74.7 million plus accrued interest of $3.0 million on November 28, 2006. The notes
were repurchased at a premium of 109.26%, resulting in a loss on extinguishment of
$6.3 million and the write-off of deferred financing fees of approximately $4.3 million
and third-party transaction costs of $0.3 million. These items were charged to income
in 2007;
    
    to repay the $27.0 million promissory note issued in respect of the repurchase of
the NACG Preferred Corp. Series A preferred shares;
    
    to purchase certain leased equipment for $44.6 million;
    
    to pay the $2.0 million fee required to terminate the advisory services agreement
with the sponsors; and
    
    $1.3 million for working capital and general corporate purposes.
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DESCRIPTION OF SHARE CAPITAL
 General
   Voting Common Shares
 3 4
  Non-Voting Common Shares
 Securities Act
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Dividends
  Trading Price and Volume
  Toronto Stock ExchangeDate
    
    
    High
    
    
    
    Low
    
    
    
    VolumeMarch 2008
    
    
    
    16.33
    
    
    
    
    11.50
    
    
    
    
    79,736February 2008
    
    
    
    16.98
    
    
    
    
    9.73
    
    
    
    
    178,074January 2008
    
    
    
    14.02
    
    
    
    
    10.87
    
    
    
    
    111,203December 2007
    
    
    
    14.02
    
    
    
    
    12.57
    
    
    
    
    141,573November 2007
    
    
    
    18.56
    
    
    
    
    12.25
    
    
    
    
    75,667October 2007
    
    
    
    18.54
    
    
    
    
    16.53
    
    
    
    
    31,250September 2007
    
    
    
    18.85
    
    
    
    
    16.50
    
    
    
    
    23,470August 2007
    
    
    
    19.80
    
    
    
    
    17.23
    
    
    
    
    106,312July 2007
    
    
    
    22.29
    
    
    
    
    18.33
    
    
    
    
    35,565June 2007
    
    
    
    23.30
    
    
    
    
    21.24
    
    
    
    
    50,250May 2007
    
    
    
    26.15
    
    
    
    
    22.01
    
    
    
    
    25,620April 2007
    
    
    
    25.76
    
    
    
    
    21.87
    
    
    
    
    34,395
 New York Stock ExchangeDate
    
    
    High
    
    
    
    Low
    
    
    
    VolumeMarch 2008
    
    
    
    16.74
    
    
    
    
    14.18
    
    
    
    
    2,228,650February 2008
    
    
    
    17.50
    
    
    
    
    9.68
    
    
    
    
    4,280,347January 2008
    
    
    
    14.58
    
    
    
    
    10.64
    
    
    
    
    2,808,400December 2007
    
    
    
    14.28
    
    
    
    
    12.30
    
    
    
    
    2,827,700November 2007
    
    
    
    20.08
    
    
    
    
    12.37
    
    
    
    
    3,906,301October 2007
    
    
    
    19.47
    
    
    
    
    16.76
    
    
    
    
    2,603,100September 2007
    
    
    
    18.06
    
    
    
    
    16.05
    
    
    
    
    2,396,900August 2007
    
    
    
    19.00
    
    
    
    
    16.11
    
    
    
    
    4,970,000July 2007
    
    
    
    21.43
    
    
    
    
    17.13
    
    
    
    
    1,436,000June 2007
    
    
    
    21.98
    
    
    
    
    19.51
    
    
    
    
    1,437,800May 2007
    
    
    
    23.72
    
    
    
    
    20.68
    
    
    
    
    1,637,800April 2007
    
    
    
    22.80
    
    
    
    
    18.60
    
    
    
    
    1,773,400
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DESCRIPTION OF CERTAIN INDEBTEDNESS
 
 Revolving Credit Facility
  General:
 Security:
 Interest rates and fees:
 Prepayments and commitment reductions:
 Covenants:
 
    
    incur debt or enter into sale and leaseback transactions or contractual contingent
obligations;
    
    amend the indenture governing our 83/4% senior notes;
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
    
    create or allow to exist liens or other encumbrances;
    
    transfer assets (including any class of stock or the voting rights of any of our
subsidiaries) except for sales and other transfers of inventory or surplus, immaterial
or obsolete assets in our ordinary course of business and other exceptions set forth in
the credit agreement;
    
    enter into mergers, consolidations and asset dispositions of all or substantially
all of our, or any of our subsidiaries properties;
    
    make investments, including acquisitions;
    
    enter into transactions with related parties other than on an arms-length basis on
terms no less favorable to us than those available from third parties;
    
    make any material change in the general nature of the business conducted by us; and
    
    make consolidated capital expenditures in excess of 120% of the amount in the
capital expenditure plan as approved by our board of directors.
  Events of default:
 
 83/4% Senior Notes due 2011
 General: 3 4 3 4 3 4
 Redemption and Repurchase: 3 4 3 4 3 4 3 4
 Covenants: 3 4
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Swap Agreements
 pari passu
 
 Debt Ratings
  
 DIRECTORS AND OFFICERS
 Directors and Officers
  Name and Municipality of Residence
    
    Age
    
    PositionRodney J. Ruston
    
    57
    
    Director, President and Chief Executive OfficerEdmonton, AlbertaPeter R. Dodd
    
    58
    
    Chief Financial OfficerEdmonton, AlbertaDavid Blackley
    
    47
    
    Vice President, FinanceSherwood Park, AlbertaRobert G. Harris
    
    60
    
    Vice President, Human Resources, Health, SafetyEdmonton, Alberta
    
    
    
    & EnvironmentKevin Mather
    
    35
    
    Vice President, Supply ChainSpruce Grove, Alberta
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Name and Municipality of Residence
    
    Age
    
    PositionBernard T. Robert
    
    41
    
    Vice President, Business Development & EstimatingSherwood Park, AlbertaMiles W. Safranovich
    
    43
    
    Vice President, OperationsSpruce Grove, AlbertaChristopher R. Yellowega
    
    37
    
    Vice President, Major Mining DevelopmentsAirdrie, AlbertaRonald A. McIntosh
    
    66
    
    Chairman of the BoardCalgary, AlbertaGeorge R. Brokaw
    
    40
    
    DirectorSouthampton, New YorkJohn A. Brussa
    
    51
    
    DirectorCalgary, AlbertaJohn D. Hawkins
    
    44
    
    DirectorHouston, TexasWilliam C. Oehmig
    
    58
    
    DirectorHouston, TexasAllen R. Sello
    
    68
    
    DirectorWest Vancouver, British ColumbiaPeter W. Tomsett
    
    50
    
    DirectorWest Vancouver, British ColumbiaK. Rick Turner
    
    50
    
    DirectorHouston, Texas
 Rodney J. Ruston
 Peter R. Dodd
 David Blackley
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Robert G. Harris
 Kevin Mather
 Bernard T. Robert
 Miles W. Safranovich
 Christopher R. Yellowega
 - 37 -




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Ronald A. McIntosh
 George R. Brokaw
 John A. Brussa
 John D. Hawkins
 William C. Oehmig
 - 38 -




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Allen R. Sello
 Peter W. Tomsett
 K. Rick Turner
 
 THE BOARD AND BOARD COMMITTEES
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1.
    
    Audit Committee:The Audit Committee recommends independent public accountants to the board,
reviews the quarterly and annual financial statements and related MD&A, press releases and
auditor reports, and reviews the fees paid to our auditors. The Audit Committee approves
quarterly financial statements and recommends annual financial statements for approval to the
board. In accordance with Rule 10A-3 under the Securities Exchange Act of 1934, as amended,
and the listing requirements of the New York Stock Exchange and the requirements of the
Canadian Securities regulatory authorities our board of directors has affirmatively determined
that our Audit Committee is composed solely of independent directors. Our board of directors
has determined that Mr. Allen R. Sello is the audit committee financial expert, as defined by
Item 407(d)(5) of the SECs Regulation S-K. Our board of directors has adopted a written
charter for the Audit Committee that is attached as Exhibit A to this annual information form.
The Audit Committee is currently composed of Messrs. Brokaw, Hawkins, Sello and Turner, with
Mr. Sello serving as Chairman. Based on their experience (see Directors and Officers above),
each of the members of the Audit Committee are financially literate. The members of the audit
committee have significant exposure to the complexities of financial reporting associated with
us and are able to address with due oversight, and provide the necessary governance over, our
financial reporting.Our auditors are KPMG LLP. Our Audit Committee pre-approved the engagement of KPMG to
perform the audit of our financial statements for the fiscal year ended March 31, 2008.The fees we have paid to KPMG for services rendered by them include:
 
 (i)
    
    Audit FeesKPMG billed us $3,037,500 in 2008, $2,375,000 in 2007 and $2,617,000 in 2006 for
audit services. Audit fees were incurred for the audit of our annual financial
statements, the audit of internal controls over financial reporting, related
audit work in connection with registration statements and other filings with
various regulatory authorities, and quarterly interim reviews of the
consolidated financial statements.
 
 (ii)
    
    Audit Related FeesKPMG billed us $55,000 in 2008, $52,000 in 2007 and $62,000 in 2006 for planning
and scoping work and advice relating to compliance and internal controls over
financial reporting.
 
 (iii)
    
    Tax FeesKPMG billed us $33,000 in 2008, $16,640 in 2007 and $15,000 in 2006 for tax
compliance services.
 
 (iv)
    
    All Other FeesKPMG did not perform any other services for us.
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2.
    
    Compensation Committee:The Compensation Committee is charged with the responsibility for
supervising executive compensation policies for us and our subsidiaries, administering the
employee incentive plans, reviewing officers salaries, approving significant changes in
executive employee benefits and recommending to the board such other forms of remuneration as
it deems appropriate. In accordance with the listing requirements of the New York Stock
Exchange applicable to domestic listed companies and applicable Canadian securities laws, our
board of directors has affirmatively determined that our Compensation Committee is composed
solely of independent directors. Our board of directors has adopted a written charter for the
Compensation Committee that is available on our website. The Compensation Committee is
currently composed by Messrs. Brussa, Oehmig, Sello and Tomsett, with Mr. Tomsett serving as
Chairman.
 3.
    
    Governance Committee:The Governance Committee is responsible for recommending to the board
of directors proposed nominees for election to the board of directors by the shareholders at
annual meetings, including an annual review as to the renominations of incumbents and proposed
nominees for election by the board of directors to fill vacancies that occur between
shareholder meetings, and making recommendations to the board of directors regarding corporate
governance matters and practices. In accordance with the listing requirements of the New York
Stock Exchange applicable to domestic listed companies and applicable Canadian securities
laws, our board of directors has affirmatively determined that our Governance Committee is
composed solely of independent directors. Our board of directors has adopted a written
charter for the Governance Committee that is available on our website. The Governance
Committee is currently composed of Messrs. Brussa, Hawkins, McIntosh and Turner, with Mr.
Hawkins serving as Chairman.
 4.
    
    Risk Committee:The Risk Committee is responsible for overseeing all of our non-financial
risks, approving our risk management policies and reviewing the risks and related risk
mitigation plans within our strategic plan. The Risk Committee is currently composed of
Messrs. Brokaw, McIntosh, Oehmig and Tomsett, with Mr. Oehmig serving as Chairman.
  Compensation Committee Interlocks and Insider Participation
  
 LEGAL PROCEEDINGS AND REGULATORY ACTIONS
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INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS
 Advisory Services Agreement
  Voting and Corporate Governance Agreement
  
    
    provide them copies of all documents, reports, financial data and other information
regarding us,
    
    permit them to consult with and advise our management on matters relating to our
operations,
    
    permit them to discuss our companys affairs, finances and accounts with our
officers, directors and outside accountants,
    
    permit them to visit and inspect any of our properties and facilities, including but
not limited to books of account,
    
    permit them to attend, to the extent that a director is not related to the sponsor,
to designate and send a representative to attend all meetings of our board of directors
in a non-voting observer capacity,
    
    provide them copies of certain of our financial statements and reports, and
    
    provide them copies of all materials sent by us to our board of directors, other
than materials relating to transactions in which the sponsor has an interest.
  Shareholders Agreements
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Registration Rights Agreement
   
    
    up to 120 days if
 o
    
    we have decided to file a registration statement for an
underwritten public offering of our common shares, the net proceeds of which
are expected to be at least US$20.0 million, oro
    
    initiated discussions with underwriters in preparation for a
public offering of our common shares as to which we expect to receive net
proceeds of at least US$20.0 million and the demand registration, in the
underwriters opinion, would have a material adverse effect on the offering or
 
    
    up to 90 days following a request for a demand registration if we are in possession
of material information that we reasonably deem advisable not to disclose in a
registration statement.
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Properties and Facilities
  
 TRANSFER AGENT AND REGISTRAR
  
 MATERIAL CONTRACTS
  
    
    Form of Indemnity Agreement between NACG Holdings Inc., NACG Preferred Corp., North
American Energy Partners Inc., North American Construction Group Inc. and their
respective officers and directors;
    
    Indenture, dated as of November 26, 2003, among North American Energy Partners Inc.,
the guarantors named therein and Wells Fargo Bank, NA., as Trustee;
    
    Registration Rights Agreement, dated as of November 26, 2003, among NACG Holdings
Inc. and the shareholders party thereto;
    
    Amended and Restated 2004 Share Option Plan;
    
    Overburden Removal and Mining Services Contract, dated November 17, 2004, between
Canadian Natural and Noramac Ventures Inc.;
    
    Amended and Restated Joint Venture Agreement, dated September 30, 2004, among North
American Construction Group Inc., Fort McKay Construction Ltd. and Noramac Ventures
Ltd., including the assignment of contract from Noramac Ventures Ltd. To North
American Construction Group Inc., dated February 27, 2006;
    
    Office Lease, as amended as of November 26, 2003, between Acheson Properties Ltd.
and North American Construction Group Inc.;
    
    Office Lease, dated as of March 15, 2003, between Acheson Properties Ltd. and North
American Construction Group Inc.;
    
    Office Lease, dated as of July 1, 2003, between Acheson Properties Ltd. and North
American Construction Group Inc.; and
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
    
    Revolving Credit Facility. Please refer to Description of Capital Structure 
Revolving Credit Facility for information regarding the second amended and restated
credit agreement that provides our revolving credit facility.
 
 RISKS AND UNCERTAINTIES
 Risks Related to our Business
 Anticipated major projects in the oil sands may not materialize
  
    
    changes in the perception of the economic viability of these projects;
    
    shortage of pipeline capacity to transport production to major markets;
    
    lack of sufficient governmental infrastructure to support growth;
    
    delays in issuing environmental permits or refusal to grant such permits;
    
    shortage of skilled workers in this remote region of Canada; and
    
    cost overruns on announced projects.
 Demand for our services may be adversely impacted by regulations affecting the energy industry.
  Failure by our customers to obtain required permits and licenses may affect the demand for our
services.
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Changes in our customers perception of oil prices over the long-term could cause our customers to
defer, reduce or stop their investment in oil sands projects, which would, in turn, reduce our
revenue from those customers.
  Insufficient pipeline, upgrading and refining capacity could cause our customers to delay, reduce
or cancel plans to construct new oil sands projects or expand existing projects, which would, in
turn, reduce our revenue from those customers.
  Lack of sufficient governmental infrastructure to support the growth in the oil sands region could
cause our customers to delay, reduce or cancel their future expansions, which would, in turn,
reduce our revenue from those customers.
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Shortages of qualified personnel or significant labor disputes could adversely affect our business.
   Cost overruns by our customers on their projects may cause our customers to terminate future
projects or expansions which could adversely affect the amount of work we receive from those
customers.
  Our ability to grow our operations in the future may be hampered by our inability to obtain long
lead time equipment and tires, which are currently in limited supply.
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Our customer base is concentrated, and the loss of or a significant reduction in business from a
major customer could adversely impact our financial condition.
  Because most of our customers are Canadian energy companies, a downturn in the Canadian energy
industry could result in a decrease in the demand for our services.
  Lump-sum and unit-price contracts expose us to losses when our estimates of project costs are lower
than actual costs.
  
    
    site conditions differing from those assumed in the original bid;
    
    scope modifications during the execution of the project;
    
    the availability and cost of skilled workers;
    
    the availability and proximity of materials;
    
    unfavorable weather conditions hindering productivity;
    
    inability or failure of our customers to perform their contractual commitments;
    
    equipment availability and productivity and timing differences resulting from project
construction not starting on time; and
    
    the general coordination of work inherent in all large projects we undertake.
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Until we establish and maintain effective internal controls over financial reporting, we cannot
assure you that we will have appropriate procedures in place to eliminate future financial
reporting inaccuracies and avoid delays in financial reporting.
  Our substantial debt could adversely affect us, make us more vulnerable to adverse economic or
industry conditions and prevent us from fulfilling our debt obligations.
  
    
    limiting our ability to obtain additional financing to fund our working capital, capital
expenditures, debt service requirements, potential growth or other purposes;
    
    limiting our ability to use operating cash flow in other areas of our business;
    
    limiting our ability to post surety bonds required by some of our customers;
    
    placing us at a competitive disadvantage compared to competitors with less debt;
    
    increasing our vulnerability to, and reducing our flexibility in planning for, adverse
changes in economic, industry and
    
    competitive conditions; and
    
    increasing our vulnerability to increases in interest rates because borrowings under our
revolving credit facility and
    
    payments under some of our equipment leases are subject to variable interest rates.
  The terms of our debt agreements may restrict our current and future operations, particularly our
ability to respond to changes in our business or take certain actions.
 
 
    
    incur or guarantee additional debt, issue certain equity securities or enter into sale
and leaseback transactions;
    
    pay dividends or distributions on our shares or repurchase our shares, redeem
subordinated debt or make other restricted
    
    payments;
    
    incur dividend or other payment restrictions affecting certain of our subsidiaries;
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
    
    issue equity securities of subsidiaries;
    
    make certain investments or acquisitions;
    
    create liens on our assets;
    
    enter into transactions with affiliates;
    
    consolidate, merge or transfer all or substantially all of our assets; and
    
    transfer or sell assets, including shares of our subsidiaries.
  We may not be able to generate sufficient cash flow to meet our debt service and other obligations
due to events beyond our control.
   Currency rate fluctuations could adversely affect our ability to repay our 8 3/4% senior notes and
may affect the cost of goods we purchase.
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If we are unable to obtain surety bonds or letters of credit required by some of our customers, our
business could be impaired.
   A change in strategy by our customers to reduce outsourcing could adversely affect our results.
  Our operations are subject to weather-related factors that may cause delays in our project work.
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We are dependent on our ability to lease equipment, and a tightening of this form of credit could
adversely affect our ability to bid for new work and/or supply some of our existing contracts.
  Our business is highly competitive and competitors may outbid us on major projects that are awarded
based on bid proposals.
   A significant amount of our revenue is generated by providing non-recurring services.
  Environmental laws and regulations may expose us to liability arising out of our operations or the
operations of our customers.
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Our projects expose us to potential professional liability, product liability, warranty or other
claims.
  We may not be able to achieve the expected benefits from any future acquisitions, which would
adversely affect our financial condition and results of operations.
  Aboriginal peoples may make claims against our customers or their projects regarding the lands on
which their projects are located.
  Unanticipated short term shutdowns of our customers operating facilities may result in temporary
cessation or cancellation of projects in which we are participating.
  Many of our senior officers have either recently joined the company or have just been promoted and
have only worked together as a management team for a short period of time.
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Risks Related to Our Common Shares
 Fluctuations in the value of the Canadian and U.S. dollars can affect the value of our common
shares and future dividends, if any.
  If our share price fluctuates, you could lose a significant part of your investment.
   
    
    changes in projections as to the level of capital spending in the oil sands region;
    
    changes in stock market analyst recommendations or earnings estimates regarding our
common shares, other comparable companies or the construction or oil and gas industries
generally;
    
    actual or anticipated fluctuations in our operating results or future prospects;
    
    reaction to our public announcements;
    
    strategic actions taken by us or our competitors, such as acquisitions or
restructurings;
    
    new laws or regulations or new interpretations of existing laws or regulations
applicable to our business and operations;
    
    changes in accounting standards, policies, guidance, interpretations or principles;
    
    adverse conditions in the financial markets or general economic conditions, including
those resulting from war, incidents of terrorism and responses to such events;
    
    sales of common shares by us, members of our management team or our existing
shareholders; and
    
    the extent of analysts interest in following our company.
 Future sales, or the perception of future sales, of a substantial amount of our common shares may
depress the price of our common shares.
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We currently do not intend to pay cash dividends on our common shares, and our ability to pay
dividends is limited by the indenture that governs our notes, our subsidiaries ability to
distribute funds to us and Canadian law.
    Our principal shareholders are in a position to affect our ongoing operations, corporate
transactions and other matters, and their interests may conflict with or differ from your interests
as a shareholder.
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We are a holding company and rely on our subsidiaries for our operating funds, and our subsidiaries
have no obligation to supply us with any funds.
  You may be unable to enforce actions against us and some of our directors and officers under U.S.
federal securities laws.
  
 ADDITIONAL INFORMATION
 
 Experts
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Additional Information
   - 57 -




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GLOSSARY
   Bitumen 
  Coker 
  Established reserves 
  Muskeg 
  Naphtha 
  Oil
sands 
  Overburden 
  Ultimately
recoverable oil reserves 
 
  Upgrading 
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EXHIBIT A
 North American Energy Partners Inc.
 AUDIT COMMITTEE CHARTER
 1.
    
    MANDATE & AUTHORITY
 1.1
    
    The Board of Directors (the Board) of North American Energy Partners Inc.
(the Company) has established an Audit Committee (the Committee) to assist the
Board in meeting its oversight responsibilities. The Committees responsibilities are
summarized as follows:
 a)
    
    monitor the integrity of the Companys
financial and related information of the Company including its
financial statements;b)
    
    monitor the system of internal controls over
financial reporting;c)
    
    monitor the disclosure controls and procedures;d)
    
    oversee the work of the external auditor;e)
    
    monitor the internal audit function;f)
    
    identify and monitor the financial risks of the
Company;g)
    
    establish the Companys ethics reporting
procedures; andh)
    
    monitor the Companys compliance with legal and
regulatory requirements.
 1.2
    
    While the Committee shall have the responsibilities and powers set forth in
this charter, it shall not be the responsibility of the Committee to determine whether
the Companys financial statements are complete, accurate or prepared in accordance
with generally accepted accounting principles, to manage financial risks or to conduct
audits. These are the responsibilities of management and the external auditor in
accordance with their respective roles.1.3
    
    The Committee will take reasonable steps to ensure that management establishes
and maintains the controls, procedures and processes that comply with all appropriate
laws, regulations or policies of the Company. It is not the responsibility of the
Committee to conduct investigations or to ensure compliance with laws or regulations or
Company policies. Management is responsible for establishing and maintaining the
controls, procedures and processes over these matters and the Committee has the
responsibility to ensure they exist.1.4
    
    The Committee has the power to conduct or authorize investigations into any
matters within the Committees scope of responsibilities. The Committee has the
authority to engage independent counsel and other advisors, as it determines necessary
to carry out its




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duties. The Company will provide the resources and funding required by the
Committee to carry out its duties.1.5
    
    The Committee shall also have unrestricted access to the Companys personnel
and documents and will be provided with the resources to carry out its
responsibilities. The Committee shall have direct communication channels with the
external auditor and the individual responsible for the internal auditor function to
discuss and review specific issues as appropriate.
 2.
    
    MEMBERSHIP
 2.1
    
    The Committee shall be composed of a minimum of three (3) directors of the
Company. Each member of the Committee shall be appointed by the Board.2.2
    
    The Board shall appoint one of the members to be the Chair of the Committee.2.3
    
    All members of the Committee shall be independent as that term is defined
under the requirements of applicable securities laws and the standards of any stock
exchange on which the Companys securities are listed, taking into account any
transitional provisions that are permitted.2.4
    
    Members shall serve one-year terms and may serve consecutive terms to ensure
continuity of experience. Members shall be reappointed each year to the Committee by
the Board at the Board meeting that coincides with the annual shareholder meeting. A
member of the Committee shall automatically cease to be a member upon ceasing to be a
director of the Company. Any member may resign or be removed by the Board from
membership on the Committee or as Chair.2.5
    
    All members of the Committee must be financially literate as that
qualification is interpreted by the Board or acquire such literacy within a reasonable
period of time after joining the Committee. At the present time, the Board interprets
financial literacy to mean a basic understanding of finance and accounting and the
ability to read and understand financial statements (including the related notes) of
the sort released or prepared by the Company in the normal course of its business.2.6
    
    At least one member of the Committee shall be an audit committee financial
expert who shall possess the attributes outlined in Appendix A.2.7
    
    No director who is currently serving on the audit committee of another public
company will be appointed to the Committee unless the Board determines that such
simultaneous service would not impair the ability of such member to serve on the
Committee. The maximum number of audit committees a director can serve on at any one
time is set at three by the NYSE.2.8
    
    The responsibilities of a member of the Committee are in addition to that
members duties as a member of the Board.2.9
    
    The Company is responsible for the orientation and continuing education of the
members.
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3.
    
    MEETINGS
 3.1
    
    Committee meetings will be conducted in a manner consistent with the Company
By-laws, the Audit Committee Charter and the applicable business corporation act.3.2
    
    The Notice of Meeting will be governed by the Company By-laws. Meetings will
be called by the Chair or any other member of the Committee as appropriate.3.3
    
    The Chair shall determine the time, place and procedures for Committee
meetings, subject to the requirements of this Charter.3.4
    
    Any director of the Company may attend Committee meetings, however, only
members of the Committee are eligible to vote or establish a quorum.3.5
    
    The external auditor will be requested to attend the meetings where the
Committee is reviewing quarterly or annual financial statements. The Committee or any
member may request that the external auditor appear before the Committee at any time.3.6
    
    The Committee will meet a minimum of four times per year and shall determine
whether additional meetings are required.3.7
    
    The Chair of the Committee shall preside at and chair all meetings of the
Committee. If the Chair is absent from a meeting, the remaining members of the
Committee shall appoint a member to act as Chair for that meeting.3.8
    
    A quorum for a meeting will be established if a majority of the members are
present. Members of the Committee may participate in a meeting through any means which
permits all parties to communicate adequately with each other. Any member not
physically present but participating in the meeting through such means is deemed to be
present at the meeting. A quorum, once established, is maintained even if members of
the Committee leave before the meeting concludes.3.9
    
    In the event of a tie vote on a resolution, the issue will be forwarded to the
full board for a vote.3.10
    
    A resolution signed by all members of the Committee entitled to vote on that
resolution is as valid as if it had been passed at a meeting of the Committee.3.11
    
    In-camera sessions will be held as deemed necessary by the Committee with the
external auditor, the individual responsible for the internal audit function,
management and the Committee by itself.3.12
    
    The Corporate Secretary or another person appointed by the Chair will act as
secretary of the Committee meetings.3.13
    
    The secretary of the meeting will keep minutes of each meeting, which shall
record the decisions reached by the Committee.
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3.14
    
    The minutes shall be distributed to Committee members with copies provided to
(a) the Board; (b) the CEO; (c) the Vice President Finance; (d) the external
auditor; and (e) the individual responsible for the internal audit function.3.15
    
    The Corporate Secretary or another person will file the Committee minutes and
all meeting material with the corporate minute books.
 4.
    
    RESPONSIBILITIES
 4.1
    
    General
 4.1.1
    
    The Committee will meet as set out in section 3 above.4.1.2
    
    The Committee will report to the Board on all matters in this
charter as well as such matters as the Board may from time to time refer or
delegate to the Committee.4.1.3
    
    The Committee will maintain a formal written Committee charter
and annually assess the adequacy of the charter, submit such evaluation to the
Board and recommend any proposed changes to the Board for approval.4.1.4
    
    The Committee members will conduct an assessment of the
effectiveness of the Committee.
 4.2
    
    Financial reporting and internal controls
 4.2.1
    
    Annual financial statementsThe Committee is responsible for the assessment of the annual audited
financial statements of the Company and to recommend approval of the
statements to the Board.4.2.2
    
    Interim financial statementsThe Committee is responsible for the assessment and approval of the
quarterly interim unaudited financial statements.4.2.3
    
    Accounting policiesThe Committee will review and discuss with management and the external
auditor, as appropriate, the Companys financial reporting policies,
including changes in or adoptions of, accounting standards and principles
and disclosure practices.The Committee will review with management and the external auditor their
qualitative judgments about the appropriateness, not just the acceptability,
of accounting principles and accounting disclosure practices used or
proposed to be used and particularly, the degree of aggressiveness or
conservatism of the Companys accounting principles and underlying
estimates.4.2.4
    
    Internal controls over financial reporting
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The Committee will review and discuss with management, the external auditor
and others, as appropriate, the existence and design of the Companys
internal controls over financial reporting established by management and the
effectiveness of such controls.The Committee will monitor the work undertaken by management to design and
implement and to provide an assessment of the effectiveness of its system of
internal control over financial reporting. The Committee will review and
discuss with the external auditor, when required, the opinion on
managements assessment of the effectiveness of its system of internal
controls over financial reporting.4.2.5
    
    Disclosure controls and proceduresThe Committee will review and discuss with management, the external auditor
and others, as appropriate, the existence and design of the Companys
disclosure controls and procedures established by management and the
effectiveness of such controls.The Committee will review and approve the disclosure policy of the Company
and periodically assess the adequacy of such policy for completeness and
accuracy. The Committee will ensure that the Company has satisfactory
procedures in place for the review of the Companys public disclosure of
financial information extracted or derived from the Companys financial
statements. The Committee will also monitor and oversee the activities of
the Companys Disclosure Committee.4.2.6
    
    Other public disclosuresThe Committee will review and approve, and in some instances recommend
approval to the Board, material financial disclosures in the following
documents prior to their public release or filing with securities
regulators:
 a)
    
    managements discussion and analysis;b)
    
    any prospectus or offering document;c)
    
    annual reports or annual information forms;d)
    
    all material financial information required by
securities regulations (e.g., Forms 6-K, 20-F and F-4) including all
exhibits thereto (including the certifications required of the
Companys principal executive officer and principal financial officer);e)
    
    any related-party transactions;f)
    
    any off balance sheet structures;g)
    
    any correspondence with securities regulators
or government financial agencies; and
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h)
    
    news or press releases, containing audited or
unaudited financial information, including the type and presentation of
information and in particular any pro-forma or non-GAAP information.
 4.3
    
    External Auditor
 4.3.1
    
    The Committee shall recommend to the Board the external
auditor to be nominated for the purpose of preparing or issuing the auditors
report or performing other audit, review or attest services for the Company and
the compensation of the external auditor and, as necessary, review and
recommend to the Board the discharge of the external auditor.4.3.2
    
    In the event of a change of external auditor, the Committee
shall review all issues and provide documentation to the Board related to the
change, including the information to be included in the Notice of Change of
Auditors and the planned steps for an orderly transition period.4.3.3
    
    The Committee shall engage the external auditor for the
purpose of preparing or issuing the auditors report or performing other audit,
review or attest services for the Company.4.3.4
    
    The Committee shall review the audit scope and plan of the
external auditor.4.3.5
    
    The external auditor shall report directly to the Committee.4.3.6
    
    The Committee will review and discuss with management and the
external auditor, as appropriate, at the completion of the annual audit and
each quarterly review:
 a)
    
    the external auditors audit or review of the
financial statements and its report thereon;b)
    
    any significant changes required to be made in
the external auditors audit plan;c)
    
    any serious difficulties or disputes between
management and the external auditor during the course of the quarterly
review or annual audit;d)
    
    any improper influence by officers on the
external auditor;e)
    
    any special audit or review steps adopted in
light of material control deficiencies;f)
    
    the summary of adjusted and unadjusted
differences;g)
    
    any related findings and recommendations of the
external auditor together with managements responses including the
status of previous recommendations; and
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h)
    
    any other matters related to the conduct of the
external audit, which are to be communicated to the Committee by the
external auditor under generally accepted auditing standards.
 4.3.7
    
    The Committee shall take reasonable steps to confirm the
independence of the external auditor, which shall include but shall not be
limited to:
 a)
    
    ensuring receipt, at least annually, from the
external auditor of a formal written statement delineating all
relationships between the external auditor and the Company, including
non-audit services provided to the Company;b)
    
    considering and discussing with the external
auditor any disclosed relationships or services, including non-audit
services, that may impact the objectivity and independence of the
external auditor;c)
    
    enquiring into and determining the appropriate
resolution of any conflict of interest in respect of the external
auditor;d)
    
    reviewing and approving the Companys hiring
policies regarding the hiring of partners, employees and former
partners and employees of the Companys existing and former external
auditor;e)
    
    requesting the rotation of the lead audit
partner every five (5) years; andf)
    
    giving consideration to the rotation of the
audit firm on a periodic basis.
 4.3.8
    
    The Committee shall pre-approve any non-audit services to be
provided to the Company or its subsidiaries by the external auditor except that
the Committee has delegated a deminimus level of $20,000 per annum to the Audit
Committee Chair who will report to the Audit Committee at their next meeting of
any work approved within this limit.4.3.9
    
    The Committee will review the nature of work performed by
audit firms (other than the external auditor) to ensure that at least one of
the nationally recognized firms remains independent in the event a change in
external auditor is necessary or desired.
 4.4
    
    Internal Audit Function
 4.4.1
    
    The Committee will determine if an internal audit function
should exist taking into account any legislative or listing requirements.4.4.2
    
    The individual responsible for the internal auditor function
reports administratively to the President and has a functional reporting
relationship to the Chair of the Committee.4.4.3
    
    The Committee will review managements proposed appointment,
termination or replacement of the internal audit function. If the Company
out-sources its internal audit function, the Companys external auditor cannot
be engaged to perform such services.
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4.4.4
    
    The Committee will review the responsibility and charter as
well as the effectiveness of the internal audit function on an annual basis.
The effectiveness assessment will include a review of its reporting
relationships, activities, resources, its independence from management and its
working relationship with the external auditor.4.4.5
    
    The Committee will review and approve the annual internal
audit plan, scope of work and ensure that the internal audit plan is
coordinated with the activities of the external auditor.4.4.6
    
    The Committee will review all internal audit reports and
managements responses.
 4.5
    
    Risk ManagementThe Committee shall review the significant financial risks and approve the Companys
policies to manage such financial risk including the Anti-Fraud Policy.4.6
    
    Ethics Reporting
 4.6.1
    
    The Committee is responsible for the establishment of a policy
and procedures for:
 a)
    
    the receipt, retention and treatment of any
complaint received by the Company regarding financial reporting,
accounting, internal accounting controls or auditing matters; andb)
    
    the confidential, anonymous submissions by
employees of the Company of concerns regarding questionable accounting
or auditing matters.
 4.6.2
    
    The Committee will review, on a timely basis, serious
violations of the Code of Conduct and Ethics Policy including all instances of
fraud.4.6.3
    
    The Committee will review on a summary basis at least
quarterly all reported violations of the Code of Conduct and Ethics Policy.
 4.7
    
    Legal and Regulatory Compliance
 4.7.1
    
    The Committee will review any litigation, claim or other
contingent liability, including any tax reassessment that could have a material
affect on the financial statements.4.7.2
    
    The Committee will review compliance with applicable
financial, tax or securities regulations and the accuracy and timeliness of
filings with regulators.4.7.3
    
    The Committee will review compliance by management in filing
and paying all statutory withholdings within the prescribed time.
 Prepared By:
    
    Approved By:
    
    Date of Approval and Issue:/s/ Vincent Gallant
    
    /s/ Allen SelloVincent Gallant
    
    Allen Sello, Chair
    
    December 7, 2006Vice President, Corporate and
    
    Audit CommitteeSecretary
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Appendix A: Audit Committee Financial Expert
  1.
    
    An understanding of generally accepted accounting principles and financial statements;2.
    
    The ability to assess the general application of generally accepted accounting principles in
connection with the accounting for estimates, accruals and reserves;3.
    
    Experience in preparing, auditing, 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 the Companys
financial statements, or experience in actively supervising one or more persons engaged in
such activities;4.
    
    An understanding of internal control over financial reporting;5.
    
    An understanding of audit committee functions;6.
    
    As provided in the rules of the SEC, the designation or identification of a person as an
audit committee financial expert does not (a) impose on that person any duties, obligations or
liability that are greater than the duties, obligations or liability imposed on that person as
a member of the Committee and the Board in the absence of such designation or identification
or (b) affect the duties, obligations or liability of any other member of the Committee or the
Board; and7.
    
    A member of the Committee may qualify as an audit committee financial expert as a result of
his or her:
 (a)
    
    education and experience as a principal financial officer, 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.
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