A View Towards 2020: The New Energy Landscape

1. A View Towards 2020: The New Energy Landscape Bob Fryklund , Chief Upstream Strategist , IHS FryklundANIMPMay2013

2. The North American Renaissance FryklundANIMPMay2013

3. First Wave-- The Shale Gale ! September 2012 64.7 Bcf per day Henry Hub monthly average cash price NGL- and oil-rich plays begin to drive third wave July 2008 56.1 Bcf per day Avg $7.45 Jan 04 to Dec 08 Haynesville, Marcellus shale plays drive second wave Shale Gale starts with Barnett, Fayetteville, and Woodford shale plays Avg $3.75 Jan 09 to Sept. 12 Hurricane Ike Hurricanes Katrina, Rita FryklundANIMPMay2013 Source: IHS CERA, Intelligence Press, and EIA.

4. Inn of America No Room FryklundANIMPMay2013

5. Global LNG supply is diversifying geographically Source: IHS CERA. Note: mt = million metric tons. FryklundANIMPMay2013

6. Second Wave - U.S. Liquids Revival • Reversing a trend that spanned the previous four decades, U.S. liquids production is expected to regain and overtake its 1970 peak by 2020. • Driven solely by the growth in tight oil and wet gas plays, total liquids production is expected to reach >11.5 mmboe/d by the end of this decade. • By 2020, tight oil production is on track to reach 4.2 mmboe/d accounting for 36% of total US liquids production (up from 21% in 2012). *Forecast numbers are production capacity **Assumes recent high oil prices above $80/bbl are maintained throughout the forecast period FryklundANIMPMay2013

7. U.S. & Canada Emerge On the World Stage Other countries predominantly unconventional (Canada oil sands), deepwater (Brazil, Angola, Other Africa) or onshore OPEC categories (Iraq, Libya). C C FryklundANIMPMay2013

8. North American oil production create higher OPEC spare capacity Year on Year Change in Total Crude Oil Production (Thousand Barrels per Day) Weak “call on OPEC” expected to result in higher OPEC spare capacity and reduce OPEC pricing power FryklundANIMPMay2013

9. A New Map for Global trade flows of crude and refined product We anticipate significant growth in global trade Gasoline Flows Diesel Flows FryklundANIMPMay2013

10. North American LPG Exports Ramp Up U.S. Imports and Exports of LPG, Thousand Tonnes per Day mmb/d 348 • Global LPG trade flows are adjusting to accommodate U.S. exports • LPG production outside the United States is also rising • Demand from international markets will need to expand to consume the new production 290 232 174 116 58 0 FryklundANIMPMay2013

11. The Industry Re Structures- Portfolio’s FryklundANIMPMay2013

12. Global Hotspots High Impact Wells Dry Plays Onshore Deepwater FryklundANIMPMay2013

13. Technology Hotspots GTL – Planned/Under Construction Mini LNG – Planned/Under Construction GTL - Operating Mini LNG - Operating GTL – Deferred/Cancelled Floating LNG

14. The Global Tight Oil Race Producing Scaling Up Pilots Frontier FryklundANIMPMay2013

15. Mega Projects Oil Sands Shale/Tight Oil US GOM Qatar LNG NW Shelf East Africa Pre-Salt Queensland 50 – 100 bil. 100 – 150 bil. 150 – 200 bil. > 200 bil.

16. EPC – Capacity Issues Drive Delays Construction delay = difference between online date at FID and actual or expected online date FryklundANIMPMay2013

17. Capex Costs Micro Bursts Brazil Upstream Cost Index Regional Upstream Indexes FryklundANIMPMay2013

18. Key Exploration and Development Activities Topsides & Drilling & Production Processing Development & Storage Units Equipment The Local Content Multiplier - Brazil 0 50 100 Percent LC (percent) Higher initial expat input on (E&PM) is likely to increase cost Access, cost, and quality are key issues for local hull upgrade and requires infrastructure upgrade Large Large turbine drive rotary equipment beyond local industry capabilities. Large pumps and compressors currently imported. Higher local content can be reached given scale and technology transfer Necessary to transfer capability/technology from other industries shouldn’t present a major hurdle Maximum LC Achievable With Current Local Capabilities 76 percent A steep change in technical capability likely to require large procurement commitment Higher local content is not a large capability/technology stretch here Higher initial expat input on E&PM is likely to increase cost Source: IHS CERA. FPSO: Floating Production Storage Offloading Vessel FryklundANIMPMay2013

19. Labor- Dealing with Peaks and Valleys FryklundANIMPMay2013

20. The New Face of Risk FryklundKNOWApril23,2013

21. The Road Ahead • A Golden Era for Contracting ? • Something for Everyone – Up/ Mid/ Downstream ? • Mega projects- Diversity Continues • New Technologies - Game Changers ? • New Models of Cooperation FryklundANIMPMay2013

22. For more information about this presentation or IHS in general, please contact Bob Fryklund +1 713 369 0317 Bob.Fryklund@ihs.com Calgary Oslo Moscow London Cambridge, MA San Francisco Beijing Paris Tokyo Denver Geneva Washington, DC Dubai Houston Mexico City Bangkok Mumbai Bogota Singapore Perth Rio de Janeiro 55 Cambridge Parkway Cambridge, Massachusetts 02142, USA IHSCERA.com FryklundANIMPMay2013