Building Trust Among Investors

1. Building Trust Among Investors • Thank you Gunnar Eckbo and congratulation with introducing the price on Iceland. • Rabbe Lund Chairman of a Swedish/ Norwegian oil company, board member world leading geosciences company and an Oil service company.

2. Building Trust Among Investors Trust not an easy concept (eg shipowner story) Trust: One in which confidence is placed (Webster)

3. Building Trust Among Investors • Investors : Different types requires different treatment. • Examples: INC,TGS, PA

4. Building Trust Among Investors • PA Resouces AB Oil and gas company founded 1994 • Listed Norway and Stockholm, >8000 shareholders • Market cap. almost 1000 mill USD • Winner on Oslo Børs the last three years • Focused independant, innovative, international E&P company • Objective: Deliver Profit and Growth

5. Company assets and locations of operation Norway: - 1 development project - 1 exploration and discovery - 8 exploration licenses Tunisia: - 6 producing fields - 2 discoveries - 4 exploration assets Equatorial Guinea: - 2 exploration assets

7. Volve Operator Statoil (49,6%), PAR (10,0%). Production from 3 wells through a drilling& processing platform (jack-up rig) with a capacity of 80 000 bbls/d liquid. The processed oil is stored in a FSO .Expected peak production ca 50 000 bbls/d. Production start Q2-2007 Recoverable reserves ca 70 MBOE as per PDO 2005. Field development - Norway

8. Development of the company- Production history, 1998 - 2005

9. Production forecast Avarage production per day, BOE/day

10. Strengths and opportunities • Strong Reserve Base - Not dependant on exploration success to grow production • As one of the largest oil producers in Tunisia, we have a solid platform for further expansion in the region • In-house knowledge and competence • Large industrial network - Strong deal flow • An increasingly strong cash flow • Access to capital markets

11. Building Trust Among Investors • Experiences: • Create interest in the company • Be visible and invest a lot of time in road shows and IR, Let the president talk. • Get profiled investors and at least several finance houses to follow the stock. • Use the finance houses that serve you well • Get highly financially competent board members with power in the financial market

12. Building Trust Among Investors • Get board members with serious investment in the company and willingness to invest in new issues • Board and managment must develop clear objectives and strategies together and communicate it. • Guide intelligently • Follow Corporate Governance • Face the brutal facts

13. Building Trust Among Investors • Use the media, internet, shareholder presentations each quarter. • Make good presentations, quarterly and annual reports • Meet investors in person -trust is a feeling • Few investors buy and hold -you need to meet potential investors all the time. Professional investors/fund is short term driven. You have to feed them all the time. • Target the prefered investor composition as you move along • If you may grow out of your current corporate advisors capacity, target the next level in time so capital can be raised fast if a golden opportunity present itself.

14. Building Trust Among Investors • Build brick on brick • Always make new issues at higher level than the previous • Have good capital structure and sufficient funds for a rainy day • Show that you follow your strategy, maintain financial control, have great ideas, act on it and create value • Your trust building is a key issue for the Board – develop an alert list.

15. Building Trust Among Investors • Conclusion: • You can fool investors once, but to build a company you need their continuous support. Then you need to earn their trust by creating shareholder value as you move along • THE ONLY WAY TO DO THAT IS TO PERFORME AND DELIVER WHAT YOU PROMISE