OFFSHORE NEWFOUNDLAND AND LABRADOR

UNLOCKING THE POTENTIAL:

Check Against Delivery – Sept. 27, 2017

UNLOCKING THE POTENTIAL: OFFSHORE NEWFOUNDLAND AND LABRADOR

Our Producing Fields

23% of Canada’s light

crude production; 6.5%

of Canada’s total oil

production

PILLARS OF STRATEGY

6

OPPORTUNITY OF SCALE

NEW DATA, NEW IDEAS, NEW OPPORTUNITIES

10

NALCOR EXPLORATION STRATEGY

Survey covers over 145,000 line kms (2011-2016) From regional 60x60km grids to detailed 5x5 km grid in license round areas

EXPLORING OUR VAST POTENTIAL Since 2010, Nalcor has pursued a multi-year Exploration Strategy founded in the collection of geoscience data to evaluate Newfoundland and Labrador’s offshore slope and deepwater basins for oil and gas potential. The exploration work to date has resulted in the collection of significant quantities of 2D and 3D data, and revealed the potential of substantial resources.

Resource Assessments

2016 25.5 billion barrels of oil and 20.6 trillion cubic feet of gas potential identified in an independent study covering blocks on offer in the West Orphan Basin.

2015 12 billion barrels of oil and 113 trillion cubic feet of gas potential identified in an independent study covering blocks on offer in 2015 license round.

Cape Freels

St. John’s

Orphan Basin

Hibernia

Terra Nova

White Rose

Hebron

Mizzen

Bay du Nord

UNLOCKED POTENTIAL

Marlim Field, Brazil

GEOLOGICAL ANALOGUES

CAPE FREELS PROSPECT

10 5 0 km

Same Scale Cape Freels

NL - Canada

COMPETITIVNESS

44 kg of CO2 (eq) 12 kg of CO2 (eq)

Offshore East Coast

Oil Sands Mining

SAGD Oil Extraction

84 kg of CO2 (eq)

World Average

18kg of CO2 (eq)

GHG EMISSIONS PER BARREL OF OIL

Existing Companies

0

500

1000

1500

0

50

100

150

0

10000

20000

30000

40000

Brent Oil Price ($US)

Total Bids ($M)

Multiclient 2D Seismic (line km)

2016

2000 2010 2016

INCREASE IN

OFFSHORE ACTIVITY

Existing Companies

As a part of the new land tenure system (2013), seismic purchases pre-round are eligible expenses for work commitment bids.

$2.55B in total bids have been received in the last 3 years despite global downturn (50% of the total bids since 1988).

OUR RESERVES

6.1 8.7 9.1 8.5

16.6 20.6 21.3

16.6

44.0 47.1 50.5

45.3 40.4

41.0

0

10

20

30

40

50

60

70

2010 2011 2012 2013 2014 2015 2016

Probable

Proved

INDUSTRY CHALLENGES

Carbon efficiency and cost efficiency

Changing the culture of workforce

Facilitating collaboration in competitive environment

Challenge of differing motivations & drivers

Limited trust across supply chain

Measuring impacts of adjustments

THANK YOU.