Oil in Sudan and Potential Revenues to GOSS Stewart Williams Wood Mackenzie

1. Oil in Sudan and Potential Revenues to GOSSStewart WilliamsWood Mackenzie

2. Presentation Overview • Upstream Licence and Oil Reserve Positions • Capital Investment and Production Outlook • Basic Structure of EPSAs in Producing Areas • Structure of Revenue Sharing and Potential Future Revenues to GOSS from Existing Contracts

3. Sudan Licensing Overview • Sudan has more licensed exploration acreage than any other African country (more than 1.1 million km2) • There are, however, relatively few blocks making the average block size massive at around 54,000 km2 • Other key producing countries have much lower average block sizes: • Nigeria - 1,500 km2 • Angola - 3,500 km2 • Algeria – 4,500 km2 • Libya – 5,500 km2 • Egypt – 4,000 km2 • Despite having a drilling density much lower than other countries, exploration success has been very high and now Sudan ranks as the sixth largest producer in Africa

4. Includes Total-Marathon-Kufpec/White Nile disputed blocks, Lundin, Express, Hi Tech Group, Cliveden, Khartoum State, Heglig, Gahtani, Ansan Wikfs, Dinder Group, All African Investment, Ascom Net Reserves and Acreage – A range of exploration players but reserves dominated by only a few companies

5. Capital Investment Source: Wood Mackenzie Estimates. Excludes E & A costs.

6. Oil Producing Areas Block 6 – Fula field plus 18 other fields CNPC (95%, operator), Sudapet (5%) Production (Al Fula Blend) is NOT subject to revenue sharing (production entirely from northern areas) Block 3/7 – Palogue plus 20 other fields Petrodar Operated CNPC (41%), Petronas (40%), Sinopec (6%), Al Thani (5%),Sudapet (8%) Production (Dar Blend) is subject to revenue sharing (100% of production is from southern areas) Blocks 1/2/4 Greater Nile Oil Project – Unity, Heglig plus 34 other fields GNPOC Operated CNPC (40%), Petronas (30%), ONGC (25%), Sudapet (5%) Production (Nile Blend) is subject to revenue sharing (mixture of production from the northern and southern areas) Block 5A – Thar Jath plus 2 other fields WNPOC Operated Petronas (68.88%), ONGC (24.13%), Sudapet (7%) Production (Nile Blend) is subject to revenue sharing (100% of production is from southern areas)

7. Production Outlook and the Sources of Production

8. EPSA Production Sharing Mechanism – Existing Developments Post-Jan 2005 Pre-Jan 2005 Contractor Costs (Unchanged) Contractor Costs Cost Recovery, to contractor Excess Cost Recovery Govt. Share of excess Govt. share subject to wealth sharing between Govt. and GOSS Gross Revenue 100% Govt. Profit Share Profit Oil/Gas Contractor Profit Share (Unchanged) Contractor Profit Share Note: Contractor denotes non-Sudanese Government company e.g. CNPC, Petronas , ONGC etc

9. Refinery Refining Revenues Administration fees for refining and exports Net Refining Revenues $/bbl - = * = Exports Export Revenues Transportation costs for exports and refining Net Export Revenues <$45/bbl = - = * * >$45/bbl = Excess Export Revenues ORSA US$45 is the ORSA Reference price for 2006 and 2007 ORSA = Oil Revenue Stabilization Account Revenue sharing provisions between National Government and GOSS, post-Jan 2005 (1) Gross Revenues Net Revenues Volumes * Price = - Costs = Gross Govt. Share

10. Scale: = US$500 million/SDD100 billion Revenue sharing provisions between National Government and GOSS, post-Jan 2005 (2) Allocated to Prod. States (2%) Refining Revenues Northern Area Production Southern Area Production Allocated to Prod. States (2%) Export Revenues Northern Area Production Southern Area Production Excess Export Revenues ORSA Chart shows to scale the estimated revenues and costs in 2007

11. Forecast Revenue Splits for 2007 Source: Wood Mackenzie, based on its view on production, fiscal terms, oil price and understanding of the wealth-sharing provisions

12. Potential Future Revenues From Blocks 1/2/4, 3/7 and 5A Source: Wood Mackenzie

13. Overall ‘Split of the Barrel’ from Blocks 1/2/4, 3/7 and 5A Based of flat US$40/bbl ORSA Reference Price Wood Mackenzie Brent price assumption is US$62.00/bbl in 2007, US$55.00/bbl in 2008, US$49.00/bbl in 2009, US$43.08/bbl in 2010 remaining flat in real terms thereafter.

14. Future GOSS Revenue Sensitivities • Revenues to GOSS will be sensitive to a number of factors • Oil Price • There is a strong relationship between global oil prices and GOSS revenues • If the Dar Blend could be sold at a higher price this would also directly benefit all parties in Sudan • Oil Production • Has a direct impact on revenues. A positive investment climate is required to sustain investment and production • Transportation/Marketing Administration Costs • These costs could potentially use up a significant part of the revenues. Reducing costs would benefit all parties.

15. Contacts Stewart Williams Senior Analyst, Africa Energy Research T: +44 131 243 4534 E: stewart.williams@woodmac.com

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