VENTURE PRODUCTION plc SubseaUK business breakfast Challenging the future The importance of subsea

1. VENTURE PRODUCTION plcSubseaUK business breakfastChallenging the future � The importance of subsea 23rd November 2005 GOOD MORNING LADIES AND GENTLEMAN MY PRESENTATION THIS MORNING IS ON THE IMPORTANCE OF SUBSEA, SPECIFICALLY RELATING TO VENTURE PRODUCTION OVER THE ENXT GEW YEARS THE KEY POINTS THAT I WISH TO DISCUSS THIS MORNING INCLUDE CAN INDEPENDENTS MAKE A DIFFERENCE DARING TO BE DIFFERENT WITH THE SUPPLY CHAIN FUTURE PLANS CONCLUSION OF THE WAY FORWARD GOOD MORNING LADIES AND GENTLEMAN MY PRESENTATION THIS MORNING IS ON THE IMPORTANCE OF SUBSEA, SPECIFICALLY RELATING TO VENTURE PRODUCTION OVER THE ENXT GEW YEARS THE KEY POINTS THAT I WISH TO DISCUSS THIS MORNING INCLUDE CAN INDEPENDENTS MAKE A DIFFERENCE DARING TO BE DIFFERENT WITH THE SUPPLY CHAIN FUTURE PLANS CONCLUSION OF THE WAY FORWARD

2. The starting point WE COINED THE PHASE IN VENTURE HOW TO MAKE THE ATYOMIC FROG JUMP IN OTHER WORDS CREATE A QUANTUN LEAP OR STEP CHANGE IN DELIVERY OF PROJECTS AT THE LAST BREAKFAST MEETING WE HEARD ABOUT THE EFFECTS OF CLIMATE CHANGE IN THE GULF OF MEXICO, THE IMPACT AROUND THE POTENTIAL ENERGY CRISIS, BUT ALSO ABOUT THE INCREASING GLOBAL SUBSEA MARKET AND HOW THIS WILL OVERSHADOW THE UK SECTOR IN TERMS OF DEMAND THE QUESTION IS � WHAT ARE WE GOING TO DO ABOUT IT? SO FIRSTLY WHAT IS VENTURE AND CAN INDEPENDENTS MAKE A DIFFERENCE IN THE UKCS MARKETWE COINED THE PHASE IN VENTURE HOW TO MAKE THE ATYOMIC FROG JUMP IN OTHER WORDS CREATE A QUANTUN LEAP OR STEP CHANGE IN DELIVERY OF PROJECTS AT THE LAST BREAKFAST MEETING WE HEARD ABOUT THE EFFECTS OF CLIMATE CHANGE IN THE GULF OF MEXICO, THE IMPACT AROUND THE POTENTIAL ENERGY CRISIS, BUT ALSO ABOUT THE INCREASING GLOBAL SUBSEA MARKET AND HOW THIS WILL OVERSHADOW THE UK SECTOR IN TERMS OF DEMAND THE QUESTION IS � WHAT ARE WE GOING TO DO ABOUT IT? SO FIRSTLY WHAT IS VENTURE AND CAN INDEPENDENTS MAKE A DIFFERENCE IN THE UKCS MARKET

3. Making a difference The leading New generation UK independent oil and gas production company focused on the North Sea VENTURE IS A NEW GENERATION INDEPENDENT OPERATOR WITH 100% FOCUS ON THE UKCS AND IS CURRENTLY ENJOYING RECORD PRODUCTION LEVLES WITH ANOTHER TWO DEVELOPMETNS COMING ON STREAM BEFORE CHRISTMAS WE CURRENTLY HAVE THREE MAIN HUBS, BUT ALOS A LARGE PROTFOLIO OF OTHER ASSETS AWAITING DEVELOPMENT INCLUDING CHESTNUT, PILOT, CHANNON AND ENSIGN TO NAME BUT A FEW TREES IS A SUBSEA DEVELOPMENT IS CONTIUNUALLY BEING DEVELOPED WITH PRODUCTION AND WATER INJECTION SUBSEA WELLS. OUR FIRST DEVELOPMENT WAS SYSCAMORE AND WE ARE NOW ON SOUTH SYCAMORE AND PLANNING THE ASH FIELD, GREATLY INCREASING FILED LIFE AND RECOVERABLE RESERVES A�S FIELD IS TWO NUI PLATOFRMS AND A NUMEB OF SUBSEA DEVELOPMENTS INCLUDING ANN, ALISON AND RECENTLY ANNABEL 1 AND ANNABEL 2. THEREFORE A NUMBER OF FUTURE SUSBEA DEVELOPMENTS ALREADY UNDERWAY TO FURTHER EXTEND FIELD LIFE GREATER KITTIWAKE AREA. THIS IS A GREAT SUCCESS FOR OURSLEVES AND DANA. THE FIELD WAS DUE FOR DECOMMISSSIONING THJIS YEAR, BUT IS CURRENTLY OPERATING AT OVER 15,OOO BPD AND WILL INCREASE NEXT EYAR WHEN GOOSANDER SUBSEA DEVELOPEMTN COMES ON STREAM. WITH ADDITIONAL DEVELOPMENTS WE SEE KITTIWAKE MOVING OUT TO AT LEAST 2015 AND BEYOND. SO WE BELIEVE THAT WE CAN MAKE A DIFFERENCE BUT SUBSEA IS ABSOLUTELY ESSENTIAL TO OUR SUSTAINABILITY AND GROWTH HOWEVER KEY TO SUCCESS IS GETTING THE RIGHT PEOPLE ON THE BUS, IN OUR CASE THE VENTURE BUSVENTURE IS A NEW GENERATION INDEPENDENT OPERATOR WITH 100% FOCUS ON THE UKCS AND IS CURRENTLY ENJOYING RECORD PRODUCTION LEVLES WITH ANOTHER TWO DEVELOPMETNS COMING ON STREAM BEFORE CHRISTMAS WE CURRENTLY HAVE THREE MAIN HUBS, BUT ALOS A LARGE PROTFOLIO OF OTHER ASSETS AWAITING DEVELOPMENT INCLUDING CHESTNUT, PILOT, CHANNON AND ENSIGN TO NAME BUT A FEW TREES IS A SUBSEA DEVELOPMENT IS CONTIUNUALLY BEING DEVELOPED WITH PRODUCTION AND WATER INJECTION SUBSEA WELLS. OUR FIRST DEVELOPMENT WAS SYSCAMORE AND WE ARE NOW ON SOUTH SYCAMORE AND PLANNING THE ASH FIELD, GREATLY INCREASING FILED LIFE AND RECOVERABLE RESERVES A�S FIELD IS TWO NUI PLATOFRMS AND A NUMEB OF SUBSEA DEVELOPMENTS INCLUDING ANN, ALISON AND RECENTLY ANNABEL 1 AND ANNABEL 2. THEREFORE A NUMBER OF FUTURE SUSBEA DEVELOPMENTS ALREADY UNDERWAY TO FURTHER EXTEND FIELD LIFE GREATER KITTIWAKE AREA. THIS IS A GREAT SUCCESS FOR OURSLEVES AND DANA. THE FIELD WAS DUE FOR DECOMMISSSIONING THJIS YEAR, BUT IS CURRENTLY OPERATING AT OVER 15,OOO BPD AND WILL INCREASE NEXT EYAR WHEN GOOSANDER SUBSEA DEVELOPEMTN COMES ON STREAM. WITH ADDITIONAL DEVELOPMENTS WE SEE KITTIWAKE MOVING OUT TO AT LEAST 2015 AND BEYOND. SO WE BELIEVE THAT WE CAN MAKE A DIFFERENCE BUT SUBSEA IS ABSOLUTELY ESSENTIAL TO OUR SUSTAINABILITY AND GROWTH HOWEVER KEY TO SUCCESS IS GETTING THE RIGHT PEOPLE ON THE BUS, IN OUR CASE THE VENTURE BUS

4. Making a difference SOWHAT IS VENTURE ABOUT � THE CLUE IS IN THE NAME IT IS LOOKING FOR A NEW PATH AND VENTURE DARES TO GO WHERE OTHERS MAY NOT VENTURE IS 100% FOCUSSED ON THE UKCS WITH MANY SUBSEA DEVELOPMENTS STRETCHING OUT TO 2010 IN OUR CURRENT BUSINESS PLAN IT�S MAIN FOCUS IS TO CONTINUE TO DEVELOP MATURE ASSETS AT THE LARGER OPERATORS DO NOT WANT AND DELIVER STRANDED RESERVE PROJECTS EFFECTIVELY TO ACHIEVE THIS, VENTURE HAS DEVELOPED IT�S BUSINESS MODEL WHICH WILL HAVE A HIGH RELIANCE ON THE SUPPLY CHAIN IN HELPING CREATING ADDITIONAL VALUE IN THE SECTOR VENTURE WILL CONTINUE TO BE LEAN IN STAFF, WITH CURRENTLY ONLY 60 EMPLOYEES, WITH OVER 40,000 BPRD PRODUCTION, 3 MAIN HUBS AND 34 PROEJCTS CURRENTLY IN DEVELOPMENT SO WE WILL MOVE FAST, LOOK TO EMPOWER PEOPLE ACROSS THE BUSINESS BUT ALOS ENSURE THAT EACH DEAL IS FAIRSOWHAT IS VENTURE ABOUT � THE CLUE IS IN THE NAME IT IS LOOKING FOR A NEW PATH AND VENTURE DARES TO GO WHERE OTHERS MAY NOT VENTURE IS 100% FOCUSSED ON THE UKCS WITH MANY SUBSEA DEVELOPMENTS STRETCHING OUT TO 2010 IN OUR CURRENT BUSINESS PLAN IT�S MAIN FOCUS IS TO CONTINUE TO DEVELOP MATURE ASSETS AT THE LARGER OPERATORS DO NOT WANT AND DELIVER STRANDED RESERVE PROJECTS EFFECTIVELY TO ACHIEVE THIS, VENTURE HAS DEVELOPED IT�S BUSINESS MODEL WHICH WILL HAVE A HIGH RELIANCE ON THE SUPPLY CHAIN IN HELPING CREATING ADDITIONAL VALUE IN THE SECTOR VENTURE WILL CONTINUE TO BE LEAN IN STAFF, WITH CURRENTLY ONLY 60 EMPLOYEES, WITH OVER 40,000 BPRD PRODUCTION, 3 MAIN HUBS AND 34 PROEJCTS CURRENTLY IN DEVELOPMENT SO WE WILL MOVE FAST, LOOK TO EMPOWER PEOPLE ACROSS THE BUSINESS BUT ALOS ENSURE THAT EACH DEAL IS FAIR

5. Making a difference LOOKING AT PROEJCTS WITHIN VENTURE MOVING FORWARD YOU CAN SEE THE STEP CHANGE THAT WE ARE CURRENTLY CREATING. FROM COMPLETING SYCAMORE IN 2003 AND STARTING ANNABEL AND GADWALL IN 2004, WE HAVE ALREADY COMPLETED AN ADDITIONAL 4 PROEJCTS IN 2005 WITH THREE PROEJCTS SANCTIONED FOR NEXT YEAR KEY TO SUCCESS MOVING FORWARD HOWEVER IS RAISING THE GAME. WE ARE GETTING TO GRIPS WITH MULTIPLE FAST TRACKS PROEJCTS THIS YEAR, PLAN TO DRIVE OUT THE INEFFICIENCIES DURING 2006 AND THEN CREATE THE MAXIMIMUM EFFECTIVENESS OF PROJECT EXECUTION ON STRANDED RESERVES MOVING FORWARD IN 2007 AND BEYOND FOR ALL THESE CHALLENGES AHEAD OF US IN OUR SUBSEA DEVELOPEMTNS ONE THING IS KEY, AND THAT IS THE ENGAGEMENT OF THE SUPPLY CHAIN MORE AS PARTNERS TO ENSURE WE UNLOCK THESE RESEVRES AND CREATE VALUE THEREFORE THE SUPPLY CHAIN STRATEGY MOVING FORWARD IS ONE OF OUR HIGHEST PRIORIITESLOOKING AT PROEJCTS WITHIN VENTURE MOVING FORWARD YOU CAN SEE THE STEP CHANGE THAT WE ARE CURRENTLY CREATING. FROM COMPLETING SYCAMORE IN 2003 AND STARTING ANNABEL AND GADWALL IN 2004, WE HAVE ALREADY COMPLETED AN ADDITIONAL 4 PROEJCTS IN 2005 WITH THREE PROEJCTS SANCTIONED FOR NEXT YEAR KEY TO SUCCESS MOVING FORWARD HOWEVER IS RAISING THE GAME. WE ARE GETTING TO GRIPS WITH MULTIPLE FAST TRACKS PROEJCTS THIS YEAR, PLAN TO DRIVE OUT THE INEFFICIENCIES DURING 2006 AND THEN CREATE THE MAXIMIMUM EFFECTIVENESS OF PROJECT EXECUTION ON STRANDED RESERVES MOVING FORWARD IN 2007 AND BEYOND FOR ALL THESE CHALLENGES AHEAD OF US IN OUR SUBSEA DEVELOPEMTNS ONE THING IS KEY, AND THAT IS THE ENGAGEMENT OF THE SUPPLY CHAIN MORE AS PARTNERS TO ENSURE WE UNLOCK THESE RESEVRES AND CREATE VALUE THEREFORE THE SUPPLY CHAIN STRATEGY MOVING FORWARD IS ONE OF OUR HIGHEST PRIORIITES

6. Supply chain management IT STARTS TO GET A LITTLE HOTTER NOW AS WE MOVE FROM THE TRADITIONAL TO THE INNOVATIVE IN TERMS OF GAINING ALIGNEMENT BETWEEN OPERATORS AND THE SUPPLY CHAIN. THE QUESTION IS DO WE DARE TO BE DIFFERENT AND CAN OIL AND WATER REALLY MIX, AND IF SO DO WE WANT TO ? OUR VIEW IS YES TO ALL THESE QUESTIONS IT STARTS TO GET A LITTLE HOTTER NOW AS WE MOVE FROM THE TRADITIONAL TO THE INNOVATIVE IN TERMS OF GAINING ALIGNEMENT BETWEEN OPERATORS AND THE SUPPLY CHAIN. THE QUESTION IS DO WE DARE TO BE DIFFERENT AND CAN OIL AND WATER REALLY MIX, AND IF SO DO WE WANT TO ? OUR VIEW IS YES TO ALL THESE QUESTIONS

7. Supply chain management SO WITH THE SUPPLY CAHIN STRATEGY WHAT ARE THE ESSENTIAL ELEMENTS OF DARING TO BE DIFFERENT THE DETAIL OF THIS IS IN A FULL RPESENTATION FROM OUR SUPPLY CAHIN MANAGER THE BUINSESS MODEL WE ACQUIRE MATURE ASSETS WITH DEVELOPMETN OPPORTUNITIES WE DO NOT NECESSARILY WANT TO BE DUTY HOLDER WE DO PROEJCTS AND DRILLING WE HAVE A HIGH RELIANCE ON THE SUPPLY CHAIN WE ARE PREPARED TO BE A LITTLE UN TYPICAL FOR THE INDUSTRY ATTRACTION ATTRACTION IS A FUNCTION OF SCALE AND ATTRACTIVENESS ATTRACTIVENESS IS BOOSTED THROUGH OPEN COMMUNICATION ATTRACTIVE IS INCREASE IF WE ACCEPT WE ARE IN THE SAME BUSINESS AND SERIOUSLY COMMIT TO REMOVE UNNECESSARY PROCESS BURDENS WE MUST HAVE THE CAPACITY FOR INNOVATION, CREATIVITY AND KNOWING WHAT IT IS TO BE A GOOD CUSTOMER SO WITH THE SUPPLY CAHIN STRATEGY WHAT ARE THE ESSENTIAL ELEMENTS OF DARING TO BE DIFFERENT THE DETAIL OF THIS IS IN A FULL RPESENTATION FROM OUR SUPPLY CAHIN MANAGER THE BUINSESS MODEL WE ACQUIRE MATURE ASSETS WITH DEVELOPMETN OPPORTUNITIES WE DO NOT NECESSARILY WANT TO BE DUTY HOLDER WE DO PROEJCTS AND DRILLING WE HAVE A HIGH RELIANCE ON THE SUPPLY CHAIN WE ARE PREPARED TO BE A LITTLE UN TYPICAL FOR THE INDUSTRY ATTRACTION ATTRACTION IS A FUNCTION OF SCALE AND ATTRACTIVENESS ATTRACTIVENESS IS BOOSTED THROUGH OPEN COMMUNICATION ATTRACTIVE IS INCREASE IF WE ACCEPT WE ARE IN THE SAME BUSINESS AND SERIOUSLY COMMIT TO REMOVE UNNECESSARY PROCESS BURDENS WE MUST HAVE THE CAPACITY FOR INNOVATION, CREATIVITY AND KNOWING WHAT IT IS TO BE A GOOD CUSTOMER

8. Supply chain management CONTRACT MANAGEMENT CONTRACT MANAGEMENT IS A TEAM ACTIVITY WE MUST HANDLE AND UNDERSTAND CONTRACT STRESS IT SHOULD BE AS DISCIPINED AND INTENSIVE AS THE TENDERING AND AWARDING PROCESS, BUT IT OFTEN ISN�T WISE USE OF THE ACTIVE AND PASSIVE RISK TOOLS IS ESSENTIAL PACE NOT PERFECTION ACQUIRE THE ABILITY TO MAKE DECISIONS SWIFTLY SUBSEA PARTNERSHIP AWARDED IN 5 WEEKS DON�T GET HUNG UP ON UNNECESSARY PROCESSS SUPPORT THE PROCESS WITH PEOPLE WITH THE RIGHT APTITUDE BUT ALOS THE RIGHT ATTITUDE ACKNOWLEDGE THAT SOMETIMES LESS IS MORE OPERATOR OR CO-OPERATOR DEMOSTRATE THAT CO-OPERATION IS BETTER THAN CONFLICT MAXIMUM RESUTLS OCCUR WHEN WE COMBINED EXPERIENCE BUILD STRUCUTRES THAT ALLOW PEOPLE TO WORK TOGETHERCONTRACT MANAGEMENT CONTRACT MANAGEMENT IS A TEAM ACTIVITY WE MUST HANDLE AND UNDERSTAND CONTRACT STRESS IT SHOULD BE AS DISCIPINED AND INTENSIVE AS THE TENDERING AND AWARDING PROCESS, BUT IT OFTEN ISN�T WISE USE OF THE ACTIVE AND PASSIVE RISK TOOLS IS ESSENTIAL PACE NOT PERFECTION ACQUIRE THE ABILITY TO MAKE DECISIONS SWIFTLY SUBSEA PARTNERSHIP AWARDED IN 5 WEEKS DON�T GET HUNG UP ON UNNECESSARY PROCESSS SUPPORT THE PROCESS WITH PEOPLE WITH THE RIGHT APTITUDE BUT ALOS THE RIGHT ATTITUDE ACKNOWLEDGE THAT SOMETIMES LESS IS MORE OPERATOR OR CO-OPERATOR DEMOSTRATE THAT CO-OPERATION IS BETTER THAN CONFLICT MAXIMUM RESUTLS OCCUR WHEN WE COMBINED EXPERIENCE BUILD STRUCUTRES THAT ALLOW PEOPLE TO WORK TOGETHER

9. Supply chain management SO DARING TO BE DIFFERENT WHAT ARE THE THREE KEY DIFFERENTIATORS FOR VNETURE PRODUCTION ONE ELEPHANTS OR GAZELLES. IT DOES NOT MATTER HOW GOOD YOU ARE AT MANIPULATING DNA YOU CANNOT CHANGE AN ELEPHANT INOT A GAZELLE WE NEED TO MAKE SWIFT DECISIONS AND PRIZE PACE NOT PERFECTION BUT ALOS UNDERSTAND THE IMPACTS AND MANAGE THE RISKS TWO WOULD WE PREFER TO BE UGLY OR ATTRACTIVE, AND IF ATTRACIVENESS IS KEY WHAT MAKES A GOOD CUSTOMER AND DOES THIS GIVE US COMPETITIVE ADVANTAGE KEY IS TO ADOPT INDUSTRY STANDARDS AND NOT DESIGN BESPOKE SOLUTIONS FOR THE SAKE OF IT AND UNDERSTAND WHAT ARE SMART BEHAVIOURS IN TODAY�S ENVIRONMENT THREE RATHER THAN BEING LABELLED AS AN OPERATOR WOULD�NT TI BE BETTER TO BE LABELLED AS A CO-OPERATOR DUE TO THE RELIANCE ON THE SUPPLY CHAIN TO CREATE VALUE FINALLY REMEMBER SMART COMES BEFORE TOUGH, BUT OUR REVIEW I ALSO GOT TOLD LEGAL COMES BEFORE SMART. SO DARING TO BE DIFFERENT WHAT ARE THE THREE KEY DIFFERENTIATORS FOR VNETURE PRODUCTION ONE ELEPHANTS OR GAZELLES. IT DOES NOT MATTER HOW GOOD YOU ARE AT MANIPULATING DNA YOU CANNOT CHANGE AN ELEPHANT INOT A GAZELLE WE NEED TO MAKE SWIFT DECISIONS AND PRIZE PACE NOT PERFECTION BUT ALOS UNDERSTAND THE IMPACTS AND MANAGE THE RISKS TWO WOULD WE PREFER TO BE UGLY OR ATTRACTIVE, AND IF ATTRACIVENESS IS KEY WHAT MAKES A GOOD CUSTOMER AND DOES THIS GIVE US COMPETITIVE ADVANTAGE KEY IS TO ADOPT INDUSTRY STANDARDS AND NOT DESIGN BESPOKE SOLUTIONS FOR THE SAKE OF IT AND UNDERSTAND WHAT ARE SMART BEHAVIOURS IN TODAY�S ENVIRONMENT THREE RATHER THAN BEING LABELLED AS AN OPERATOR WOULD�NT TI BE BETTER TO BE LABELLED AS A CO-OPERATOR DUE TO THE RELIANCE ON THE SUPPLY CHAIN TO CREATE VALUE FINALLY REMEMBER SMART COMES BEFORE TOUGH, BUT OUR REVIEW I ALSO GOT TOLD LEGAL COMES BEFORE SMART.

10. SO WHY BOTHER LOOKING AT THIS GRAPH SHOWING WHERE THE MNAXIMUM VALUE IS CREATED WITHOUT THE PROJECT LIFE CYCLE, THE MAXIMUM VALUE IS CREATED DURING THE SCREEN, REFINE AND DEFINE STAGE. AT THIS POINT THE PROEJCT IS SANCTIONS, THE PROJECT EXECUTION PLAN IS IN PLACE, AND THE CONTRACT IS SET AGAINST THE SCOPE IF WE IGNORE THE FACT THAT MANY COMPANIES IN THE SUPPLY CHAIN DO NOT GET INVOLVED UNTIL THIS STAGE, MUCH OF THE VALUE CAN ALSO BE DESTOYED THEREFORE VENTURE PRODUCTION�S SUPPLY CHAIN STRATEGY IS TO GET FULL ENGAGEMENT RIGHT AT THE FRONT END TO ENSURE THE MAXIMUM VALUE CAN BE CREATED FOR ALL PARTIES AS AN EXAMPLE, WE INVITE ALL THE KEY CONTRACTORS AND SUPLIERS TO OUR MONTHLY PROEJCT MEETING WHERE WE DISCUSS THE CORPORATE PERFORMANCE PROJECT PORTFOLIO AND ENGAGE IN A JOINT IMPROVEMENT SESSION ONLY THEN CAN WE GET THE STEP CHANGE THAT THE INDUSTRY NEEDSSO WHY BOTHER LOOKING AT THIS GRAPH SHOWING WHERE THE MNAXIMUM VALUE IS CREATED WITHOUT THE PROJECT LIFE CYCLE, THE MAXIMUM VALUE IS CREATED DURING THE SCREEN, REFINE AND DEFINE STAGE. AT THIS POINT THE PROEJCT IS SANCTIONS, THE PROJECT EXECUTION PLAN IS IN PLACE, AND THE CONTRACT IS SET AGAINST THE SCOPE IF WE IGNORE THE FACT THAT MANY COMPANIES IN THE SUPPLY CHAIN DO NOT GET INVOLVED UNTIL THIS STAGE, MUCH OF THE VALUE CAN ALSO BE DESTOYED THEREFORE VENTURE PRODUCTION�S SUPPLY CHAIN STRATEGY IS TO GET FULL ENGAGEMENT RIGHT AT THE FRONT END TO ENSURE THE MAXIMUM VALUE CAN BE CREATED FOR ALL PARTIES AS AN EXAMPLE, WE INVITE ALL THE KEY CONTRACTORS AND SUPLIERS TO OUR MONTHLY PROEJCT MEETING WHERE WE DISCUSS THE CORPORATE PERFORMANCE PROJECT PORTFOLIO AND ENGAGE IN A JOINT IMPROVEMENT SESSION ONLY THEN CAN WE GET THE STEP CHANGE THAT THE INDUSTRY NEEDS

11. Beating the market place SO FAR IT IS A LOT OF GOOD WORDS, BUT THE QUESTION IS DOES VENTURE WALK THE TALK, CAN WE WITH THE SUPPLY CHAIN REALLY MAKE A DIFFERENCE IN OUR MARKET PLACE IN CHINESE THE WORD CRISIS MEANS TWO THINGS POTENTIAL DANGER � WHEN WE SEE DANGER TO THROW STONES AT IT, RUN FOR COVER AND REVERT TO TYPE HIDDEN OPPORTUNITY � UNCOVERNIG THE VALUE THAT LIES WITHIN MEANS TO NEED TO VENTURE INTO NEW TERRITOIRES HERE ARE SOME EXAMPLES FOR OUR SECTOR IN VENTURE SO FAR IT IS A LOT OF GOOD WORDS, BUT THE QUESTION IS DOES VENTURE WALK THE TALK, CAN WE WITH THE SUPPLY CHAIN REALLY MAKE A DIFFERENCE IN OUR MARKET PLACE IN CHINESE THE WORD CRISIS MEANS TWO THINGS POTENTIAL DANGER � WHEN WE SEE DANGER TO THROW STONES AT IT, RUN FOR COVER AND REVERT TO TYPE HIDDEN OPPORTUNITY � UNCOVERNIG THE VALUE THAT LIES WITHIN MEANS TO NEED TO VENTURE INTO NEW TERRITOIRES HERE ARE SOME EXAMPLES FOR OUR SECTOR IN VENTURE

12. Beating the market place ONCE VENTURE HAD CREATED THE NEW BUSINESS MODEL AND APPROACH THE FIRST ITEM IN BEATING THE MARKET WAS THE WINTER LAUNCH OF THE SYCAMORE BUNDLE. TH.IS WAS A FIRST AND HIGHLY SUCCESSFUL. WE THEN WENT ON TO COMEPLTE THE FAST TRACK PROEJCT ANNABLE WITH WINTER WORK ON TOPSIDES AND SUBSEA LAST WINTER. THIS HAS ALSO BEEN A HUGE SUCCESS FOR THE COMPANY OVER THE LAST 12 MONTHS WE ARE NOW WORKING WITH SUBSEA 7 ON A FLOATABLE BUNDLE DESIGN FOR GOOSANDER WITH ONE 7.5 KM BUNDLE AND ONE 5.5 KM BUNDLE SO THEY CAN BE USED AGAIN TOGETHER OR SEPARATELY OTHER SUCCESSES ALOS INCLUDE SAL SYSTEM FORMN ARDMORE WITH RE-USE OF FLEXIBLES THE SEVAN SSP 300 FPSO CONCEPT COMPELTING TANK TRIALS NEXT MONTH DRILLSHIP FORM FUGRO FOR THE DRILLING OF SHALLOW HEAVY OIL APPRAISAL WELLS BUYING IN USED OR NEW EQUIPMENT FROM OTHER OPERATORS TO GIVE US FLEXIBILITY AND PACE ON NEW DEVELOPMENTS ONCE VENTURE HAD CREATED THE NEW BUSINESS MODEL AND APPROACH THE FIRST ITEM IN BEATING THE MARKET WAS THE WINTER LAUNCH OF THE SYCAMORE BUNDLE. TH.IS WAS A FIRST AND HIGHLY SUCCESSFUL. WE THEN WENT ON TO COMEPLTE THE FAST TRACK PROEJCT ANNABLE WITH WINTER WORK ON TOPSIDES AND SUBSEA LAST WINTER. THIS HAS ALSO BEEN A HUGE SUCCESS FOR THE COMPANY OVER THE LAST 12 MONTHS WE ARE NOW WORKING WITH SUBSEA 7 ON A FLOATABLE BUNDLE DESIGN FOR GOOSANDER WITH ONE 7.5 KM BUNDLE AND ONE 5.5 KM BUNDLE SO THEY CAN BE USED AGAIN TOGETHER OR SEPARATELY OTHER SUCCESSES ALOS INCLUDE SAL SYSTEM FORMN ARDMORE WITH RE-USE OF FLEXIBLES THE SEVAN SSP 300 FPSO CONCEPT COMPELTING TANK TRIALS NEXT MONTH DRILLSHIP FORM FUGRO FOR THE DRILLING OF SHALLOW HEAVY OIL APPRAISAL WELLS BUYING IN USED OR NEW EQUIPMENT FROM OTHER OPERATORS TO GIVE US FLEXIBILITY AND PACE ON NEW DEVELOPMENTS

13. Future plans SO THE PROOF IS IN THE PUDDING, IN TERMS OF REALISING VALUE BY THINKING SLIGHTLY DIFFERNETLY, BUT HAVING A ROBUST STRATEGY IN PLACE TO MAKE IT WORK THEREFORE THE FITH QUESTION IS HOW DO WE CONTINUE TO BEAT THE MARKET, AND ON THIS NOTE AS WE BELIVE OIL AND WATER CAN MIX I WILL PASS YOU ONTO STEVE WISLEY FROM SUBSEA 7 WHO WILL SHOW OUR FUTURE PLANS AND CONCLUSIONS. OVER TOO YOU STEVESO THE PROOF IS IN THE PUDDING, IN TERMS OF REALISING VALUE BY THINKING SLIGHTLY DIFFERNETLY, BUT HAVING A ROBUST STRATEGY IN PLACE TO MAKE IT WORK THEREFORE THE FITH QUESTION IS HOW DO WE CONTINUE TO BEAT THE MARKET, AND ON THIS NOTE AS WE BELIVE OIL AND WATER CAN MIX I WILL PASS YOU ONTO STEVE WISLEY FROM SUBSEA 7 WHO WILL SHOW OUR FUTURE PLANS AND CONCLUSIONS. OVER TOO YOU STEVE

14. Future plans KEY TO CONTINUING TO BEAT THE MARKET IS FIRSTLY TO HAVE A GOOD PORTFOLIO OF POTENTIAL WORK MOVING FORWARD THAT IS WELL PLANNED. SECONDLY THERE MUST BE FULL COMMITMENT FROM THE MANAGEMENT TEAMS TO MAKE IT WORK AND THIRDLY A CLEAR UNDERSTANDING BY THE PROEJCT TEAMS ON THE EXPECTATIONS AND SUPPORT STRUCUTRES LOOKING AT THE 2006 AND 2007 THERE IS A FULL PROGRAM OF PROJECTS WITH VARIETY OF DIFFERNET SCOPES AND SUBSEA CHALLENGES THE OVERALL PROJECT PORTFOLIO REPRESENTS A CAPITAL EXPENDATURE OF AROUND �200 MILLION POUNDS PER YEAR THE PIVOTABLE PROJECTS FOR 2006 ARE THE GOOSANDER FIELD DEVELOPMENT WHICH HAS OPTIONALITY TO TIE IN AT LEAST ANOTHER THREE FIELDS FROMM OUTLYING RESERVOIRS. PILOT IS A LARGE HEAVY OIL FIELD AND THE USE OF AN INNOVATIVE DRILLING PROGRAM COULD SEE THE DEVELOPMENT OF THIS FIELD MOVING FORWARD ONCE THE VISCOSITY MODEL IS PROVEN UP IN 2007 KEY PROEJCTS REQUIRING SUBSTANTIAL SUBSEA WORK INCLUDE, CHESTNUT, ENSIGN, ADELE AND SOUTH SYCMORE WATER INJECTIONKEY TO CONTINUING TO BEAT THE MARKET IS FIRSTLY TO HAVE A GOOD PORTFOLIO OF POTENTIAL WORK MOVING FORWARD THAT IS WELL PLANNED. SECONDLY THERE MUST BE FULL COMMITMENT FROM THE MANAGEMENT TEAMS TO MAKE IT WORK AND THIRDLY A CLEAR UNDERSTANDING BY THE PROEJCT TEAMS ON THE EXPECTATIONS AND SUPPORT STRUCUTRES LOOKING AT THE 2006 AND 2007 THERE IS A FULL PROGRAM OF PROJECTS WITH VARIETY OF DIFFERNET SCOPES AND SUBSEA CHALLENGES THE OVERALL PROJECT PORTFOLIO REPRESENTS A CAPITAL EXPENDATURE OF AROUND �200 MILLION POUNDS PER YEAR THE PIVOTABLE PROJECTS FOR 2006 ARE THE GOOSANDER FIELD DEVELOPMENT WHICH HAS OPTIONALITY TO TIE IN AT LEAST ANOTHER THREE FIELDS FROMM OUTLYING RESERVOIRS. PILOT IS A LARGE HEAVY OIL FIELD AND THE USE OF AN INNOVATIVE DRILLING PROGRAM COULD SEE THE DEVELOPMENT OF THIS FIELD MOVING FORWARD ONCE THE VISCOSITY MODEL IS PROVEN UP IN 2007 KEY PROEJCTS REQUIRING SUBSTANTIAL SUBSEA WORK INCLUDE, CHESTNUT, ENSIGN, ADELE AND SOUTH SYCMORE WATER INJECTION

15. Future plans LOOKING FURTHER AHEAD, VENTURE PRODUCTION NOW HAS A BUSINESS PLAN THAT STRETCHES OUT TO 2010 AND BEYOND WITH SIMLIAR EXPENDATURE LEVELS AS 2006 AND 2007. THIS IS DUE TO THE BUSINESS MODEL WHICH MEANS AT 80,000 BARRELS PER DAY OF PRDUCTION WE MUST COMEPLTE BETWEEN 3 TO 8 SUSBEA PROJECTS PER YEAR FOR THE FORESEEABLE FUTURE SOME INTERESTING PROJECTS INCLUDE STRANDED RESERVE PROJECTS SUCH AS BEECHNUT AND ACORN LARGER SUBSEA PROEJCTS SUXCH AS APPLETON HEAVY OIL DEVELOPMENTS SUCH AS PILOT NEW FPSO CONCEPTS SUCH AS CHESTNUT NORMALLY UNTENDED INSTALLATIONS WITH TIE BACKS IN THE SOUTHERN NORTH SEA, AS WELL AS THE MORE TRADISTIONAL SEASUB TIE BACK PROJECTS KEY MOVING FORWARD IS TO HAVE THE RIGHT RELATIONSHIPS WITH COMPANIES AND PEOPLE THAT REALLY WANT TO MAKE A DIFFERENCE IN THIS SECTOR AND CREATE WORLD CLASS PERFORMANCE ON STRANDED RESERVE PROEJCTS MOVING FORWARD THIS IS NOT EASY BUT EXCITING AND HUGELY REWARDING LOOKING FURTHER AHEAD, VENTURE PRODUCTION NOW HAS A BUSINESS PLAN THAT STRETCHES OUT TO 2010 AND BEYOND WITH SIMLIAR EXPENDATURE LEVELS AS 2006 AND 2007. THIS IS DUE TO THE BUSINESS MODEL WHICH MEANS AT 80,000 BARRELS PER DAY OF PRDUCTION WE MUST COMEPLTE BETWEEN 3 TO 8 SUSBEA PROJECTS PER YEAR FOR THE FORESEEABLE FUTURE SOME INTERESTING PROJECTS INCLUDE STRANDED RESERVE PROJECTS SUCH AS BEECHNUT AND ACORN LARGER SUBSEA PROEJCTS SUXCH AS APPLETON HEAVY OIL DEVELOPMENTS SUCH AS PILOT NEW FPSO CONCEPTS SUCH AS CHESTNUT NORMALLY UNTENDED INSTALLATIONS WITH TIE BACKS IN THE SOUTHERN NORTH SEA, AS WELL AS THE MORE TRADISTIONAL SEASUB TIE BACK PROJECTS KEY MOVING FORWARD IS TO HAVE THE RIGHT RELATIONSHIPS WITH COMPANIES AND PEOPLE THAT REALLY WANT TO MAKE A DIFFERENCE IN THIS SECTOR AND CREATE WORLD CLASS PERFORMANCE ON STRANDED RESERVE PROEJCTS MOVING FORWARD THIS IS NOT EASY BUT EXCITING AND HUGELY REWARDING

16. Conclusions AT THE BEGINNING OF THIS PRESENTATION CHRIS TALKED ABOUT NOW JUST TALKING ABOUT IT BUT TAKING ACTION AND MOVING FORWARD, SO IN CONCLUSION I HAVE TWO SIDES THAT SHOWS TODAY�S ENVIRONMENT AND WHERE WE MAY BE GOINGAT THE BEGINNING OF THIS PRESENTATION CHRIS TALKED ABOUT NOW JUST TALKING ABOUT IT BUT TAKING ACTION AND MOVING FORWARD, SO IN CONCLUSION I HAVE TWO SIDES THAT SHOWS TODAY�S ENVIRONMENT AND WHERE WE MAY BE GOING

17. Conclusions IF WE FIRST LOOK AT WHERE WE FEEL THE CURRENT UK MARKET SITS YOU HAVE HEARD NOW SEVERAL TIMES THAT THE UK MUST AGRESSIVELY DEVELOPMENT THE RESERVES THAT ARE LEFT IN THE UKLCS AND THERE ARE STILL AND LARGE NUMBER OF PRIZES OUT THERE FOR US TO DEVELOP WE HEARD FROM THE PRESENTATIONS AT THE LAST BREAKFAST MEETING THAT DEMAND FOR BOTH DEEP WATER AND SHALLOW WATER DEVELOPMENTS ON A GLOBAL SCALE ARE CONTINUING TO GROW AT A FAST PACE AND ARE OVERSHADOWING THE UKCS DEVELOPMENTS MOVING FORWARD WE ALSO KNOW THAT MANY OF THE UKCS PROSPECTS ARE GETTING MUCH SMALLER WITH MANY LESS THAN 50MM BARRELS IN PLACE, AND WITH HIGHER RISKS ARE TECHNICALLY AND COMMERCIALLY CHALLENGING HOWEVER, WITH NEW BUSINESS MODELS WE MUST MOVE FORWARD AND MEET THESE CHALLENGES SO WHAT ABOUT THE FUTUREIF WE FIRST LOOK AT WHERE WE FEEL THE CURRENT UK MARKET SITS YOU HAVE HEARD NOW SEVERAL TIMES THAT THE UK MUST AGRESSIVELY DEVELOPMENT THE RESERVES THAT ARE LEFT IN THE UKLCS AND THERE ARE STILL AND LARGE NUMBER OF PRIZES OUT THERE FOR US TO DEVELOP WE HEARD FROM THE PRESENTATIONS AT THE LAST BREAKFAST MEETING THAT DEMAND FOR BOTH DEEP WATER AND SHALLOW WATER DEVELOPMENTS ON A GLOBAL SCALE ARE CONTINUING TO GROW AT A FAST PACE AND ARE OVERSHADOWING THE UKCS DEVELOPMENTS MOVING FORWARD WE ALSO KNOW THAT MANY OF THE UKCS PROSPECTS ARE GETTING MUCH SMALLER WITH MANY LESS THAN 50MM BARRELS IN PLACE, AND WITH HIGHER RISKS ARE TECHNICALLY AND COMMERCIALLY CHALLENGING HOWEVER, WITH NEW BUSINESS MODELS WE MUST MOVE FORWARD AND MEET THESE CHALLENGES SO WHAT ABOUT THE FUTURE

18. Conclusions WE ARE EXTREMELY BUSY IN THE UKCS SUBSEA SECTOR WITH LOTS OF PROEJCTS BUT MORE IMPORTATNLY A LARGE VARIETY OF PROJECTS MOVING FORWARD OVER THE NEXT 5 TO 10 YEARS AT LEAST. THEREFORE WE HAVE ASUPERB OPPORTUNITY TO MAINTAIN AND CONTINUALLY DEVELOP WORLD CALLS SKILLS THAT CAN BENEFIT THE UKCS OIL AND GAS PRODUCTION AS WELL AS MAINTAINING OUR POSITION AT THE TOP OF THE GLOBAL MARKET IN SUBSEA TECHNOLOGIES, ENGINEERING AND EXECUTION OF PROJECTS THE ONLY WAY TO REALLY DRIVE IMPROVMENTS AND INNOVATION TO CREATE THE STEP CHANGE OR SHOULD I SAY MAKE THE ATOMIC FROG JUMP IS TO CONTINUE TO DRIVE COOPERATIVE AND COLLABORATIVE RELATIONSHIPS AT HAVE A LOT OF THOUGHT ON HOW THEY ARE PUT TOGETHER INDEPENDENTS LIKE VENTURE ARE ALREADY MAKING A DIFFERENCE IN THER MARKET BUT ONLY WITH THE SUPPORT OF THEIR KEY CONTRACTORS AND THE SUPPLY CHAIN. VNETURE ALSO NEEDS WORLD CALLS PERFORMANCE TO MAINTAIN ITS SUCCESS IN THE UK FOR MANY YEARS TO COME FINALLY, WE REALLY DO NEED TO MAKE THE ATOMIC FROG JUMP, NOT JUST TALK ABOUT IT. THEREFORE FOR EACH PERSON IN THE AUDIENCE I LEAVE YOU WITH ONE QUESTION �WHAT ARE YOU GOING TO DO TO MEET THESE CAHLLENGES?2 THANKYOUWE ARE EXTREMELY BUSY IN THE UKCS SUBSEA SECTOR WITH LOTS OF PROEJCTS BUT MORE IMPORTATNLY A LARGE VARIETY OF PROJECTS MOVING FORWARD OVER THE NEXT 5 TO 10 YEARS AT LEAST. THEREFORE WE HAVE ASUPERB OPPORTUNITY TO MAINTAIN AND CONTINUALLY DEVELOP WORLD CALLS SKILLS THAT CAN BENEFIT THE UKCS OIL AND GAS PRODUCTION AS WELL AS MAINTAINING OUR POSITION AT THE TOP OF THE GLOBAL MARKET IN SUBSEA TECHNOLOGIES, ENGINEERING AND EXECUTION OF PROJECTS THE ONLY WAY TO REALLY DRIVE IMPROVMENTS AND INNOVATION TO CREATE THE STEP CHANGE OR SHOULD I SAY MAKE THE ATOMIC FROG JUMP IS TO CONTINUE TO DRIVE COOPERATIVE AND COLLABORATIVE RELATIONSHIPS AT HAVE A LOT OF THOUGHT ON HOW THEY ARE PUT TOGETHER INDEPENDENTS LIKE VENTURE ARE ALREADY MAKING A DIFFERENCE IN THER MARKET BUT ONLY WITH THE SUPPORT OF THEIR KEY CONTRACTORS AND THE SUPPLY CHAIN. VNETURE ALSO NEEDS WORLD CALLS PERFORMANCE TO MAINTAIN ITS SUCCESS IN THE UK FOR MANY YEARS TO COME FINALLY, WE REALLY DO NEED TO MAKE THE ATOMIC FROG JUMP, NOT JUST TALK ABOUT IT. THEREFORE FOR EACH PERSON IN THE AUDIENCE I LEAVE YOU WITH ONE QUESTION �WHAT ARE YOU GOING TO DO TO MEET THESE CAHLLENGES?2 THANKYOU

19. The beginning of a new era