GAS DEVELOPMENT IN AZERBAIJAN Kevin Boyne

Technical Advisor to Senior Vice President for Continental Europe and Central Asia, Total Exploration Production

TEAS Business Forum, Paris, March 14th, 2013

AZERBAIJAN OIL FIRSTS

! First oil well in the world was drilled (not hand dug) in 1846 in Baku in Bibi Heybat oil field

! In 1900 Azerbaijan produced more than 50% of worlds oil - 11.4 million tons

! In 1897-1907 the 1st largest oil pipeline in the world was built from Baku to Batumi - 883 km

! About 80% of oil production during 2nd world war in former USSR was made in Baku (peak production 23,5 million tons in 1941)

! First offshore oil production in the world started in Azerbaijan (1924 Bibi Heybat beach, 1947 Oily Rocks - in open sea)

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TPAO

Yalama1 & 2

AZERBAIJAN : CURRENT POTENTIAL MAINLY OFFSHORE

TEAS Business Forum, Paris, 14/03/2013 3

Key Exploration wells

Discovery Uncommercial discovery Shows Dry

!"##$ %&'"$ ()$*$ +,"-&'.-$

/*0%12$ !"#"$ %""%$ &'()*$

34516$ #++%$ !+,-$ ./0)1'($

78&8$)"90:$;16$ #+++$ %2#%$ ./$

5

TOTAL E&P IN AZERBAIJAN

Gas Export to SCP

Condensate Export to BTC

SCPco:10 %

BTCco: 5 %

ABSHERON : 40 % Operated Non Operated

SHAH DENIZ:10 %

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4000

4500

5000

5500

6000

6500

7000

ABX-1A ABX-2.T1

BalVIIIBC

Additional HC column that could be proven by a Side-track to the N

N

Undiscovered potential

S

NKP FAS E

BAL VI-VII

BAL VIII

BAL X FAS B FAS D

BAL IX

HC columns proven by ABX-2.T1 and ABX-1

Structural spill point to the N

Possible delineation side-track

Additional deep prospectivity in Kalinsky

TD=6874 m/RT Below NKP

ABSHERON : THE ABX-2 WELL

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Azerbaidjan - Gas Export

TANAP (Azerbaijan 80% Turkey 20%) !!Likely participations : SOCAR 51% + 29% offered to BP/

SH/Total (Total 5%) TPAO 15% + BOTAS 5% !!Mainly 56 with minimum 16 bcma initial capacity (scalable

to 32 bcma and more) !!Estimated Capex of USD 7 billion !!SOCAR is the operator of the project (operator)

Nabucco West (OMV (34,76%), FGSZ MOL (13,1%), Transgaz, Bulgargaz, BOTAS : 17,38% each !! NW route and delivery points unchanged !!10 bcma capacity scalable !! Estimated Capex 4 G! (48)

TAP (AXPO (ex EGL) 42.5%, Statoil 42.5%, E.ON 15%)

!!10 bcma capacity (+ expansion to 20 bcma) !!Estimated Capex 3,5 G! !!AXPO and Statoil ready to dilute. !!Funding Agreement and Option Agreement with

BP, SOCAR and Total signed !!Probable participations following exercise of

options : SOCAR 20%, BP 20%, Statoil 20%, Total 10%, AXPO 15%, E.ON 15%.

TEAS Business Forum, Paris, 14/03/2013