Total E&P Norge 2012 Annual Report by Fasett AS

total E&P norgE aS annual rEPort

cOnTEnTs 02 05 07

KEy figurEs AbOuT TOTAL E&P nOrgE rEsOurcE mAnAgEmEnT bOArd Of dirEcTOrs’ rEPOrT

15 16 18 19 20 29

incOmE sTATEmEnT bALAncE shEET cAsh fLOw sTATEmEnT AccOunTing POLiciEs nOTEs AudiTiOr’s rEPOrT

OrgAnisATiOn chArT

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ibc Our inTErEsTs On ThE ncs

TOTAL E&P is invOLvEd in ExPLOrATiOn And PrOducTiOn Of OiL And gAs On ThE nOrwEgiAn cOnTinEnTAL shELf, And PrOducEd On AvErAgE

275 000

bArrELs Of OiL EquivALEnTs EvEry dAy in 2012.

RESOURCE MANAGEMENT A key objective is to mature and drill exploration prospects in our acreage

TOTAl E&P NORGE AS ANNUAl REPORT

key figures 2012

MillioN Nok

2011

2010

iNCOMe sTATeMeNT

Total revenues

51 109

51 326

47 777

operating profit

33 196

36 185

29 774

(358)

(213)

(236)

Financial income/(expenses) â&#x20AC;&#x201C; net Net income before taxes

32 838

35 971

29 539

Taxes on income

23 417

26 262

20 184

9 421

9 709

9 354

17 093

19 276

13 711

Net income Cash flow from operations BALANCe sHeeT

intangible assets

2 813

794

1 200

investments, property, plant and equipment

57 126

49 438

48 821

Current assets

10 027

12 191

6 829

Total equity

7 119

6 698

6 589

long-term provisions

27 299

26 180

23 670

long-term liabilities

10 473

126

1 129

Current liabilities

25 074

29 418

25 463

Acquisition of property, plant and equipment

16 202

10 410

8 308

Exploration activity, costs and investments

1 433

1 682

671

Rate of return on capital employed*

58.3%

61.0%

69.4%

OTHer key figures

Production cost USD/BBL

9.0

7.5

6.8

Transport cost USD/BBL

4.4

4.6

4.1

275

287

310

1 083

1 057

1 065

322

289

277

PrODuCTiON

thoUSanD Boe

Net average daily production reserVes Of OiL AND gAs miLLion Boe

Proved developed and undeveloped reserves at 31.12 eMPLOyees

Average number of employees

* Net income plus financial expense after tax as a percentage of capital employed at 1 January. Capital employed consists of total equity and liabilities less non-interest carrying debt.

51 109 33 196 275 1 083 322 total revenues million nok

operating profit million nok

production (net average daily production) thousand boe

reserves of oil and gas (proved developed and undeveloped reserves at 31.12) million boe

employees (average number during 2012)

RESOURCE MANAGEMENT

WE CONTiNUE TO EvAlUATE all new Exploration Rounds, under both the APA system and the Conventional Rounds. At the end of 2012 we submitted applications under the 22nd Licensing Round with awards expected in June 2013. WE hAvE PARTiCiPATiONS in 29 producing fields and hold the largest reserve base in Norway among the international oil companies. Total E&P Norge’s 2012 production (275 kboe/d) constitutes approximately 12% of the TOTAL Group’s worldwide production. Our capital investment levels in Norway reached a record level of 16 BNOK in 2012, and are expected to remain at similar high levels in the years ahead.

A kEy ObjECTivE is to mature and drill explora-

A fUNdAMENTAl dRivER fOR ThE Oil ANd GAS bUSiNESS REvOlvES AROUNd RESOURCE MANAGEMENT: TO TAkE ACREAGE ANd diSCOvER hydROCARbON RESOURCES TO dEvElOP SUCh RESOURCES iN A TiMEly ANd COST EffECTivE MANNER TO MAxiMiSE Oil ANd GAS RECOvERy RESOURCE MANAGEMENT must of course be done safely and sustainably whilst minimising the environmental footprint of our activities. A necessary condition to achieve this goes through the recruitment, training and development of our human resources and systems, such that the organization has the competence required to conduct its activities in a safe and efficient manner. i AM ThEREfORE very satisfied that not only did Total E&P Norge achieve its objectives for our operated and non operated activities in 2012, but also that this was done with full regard to the health and safety of all our staff and contractors as well as the environment.

TOTAl E&P NORGE has an extensive position on the Norwegian Continental Shelf (NCS), participating in 99 Production Licences, including 27 as operator. Our portfolio is in constant evolution, these numbers include 8 awards under the APA 2012 concession round (4 as Operator, 4 as Partner). We also executed a swap agreement with ExxonMobil, exchanging our interests in several fields in the Tampen Area for ExxonMobil’s interests in Oseberg and Gina Krog (Dagny).

tion prospects in our acreage base. Following the two successful exploration wells drilled in 2011, Norvarg and Alve North, Total E&P Norge as operator, last year made the Garantiana (PL 554) oil discovery, some 30 km to the northeast of Visund. We were also a partner in the King Lear discovery in the Southern part of the North Sea. In 2013 the focus will return again to the Barents Sea, with the Norvarg 2 appraisal well to be spudded in April 2013. To drill this well and to secure future capacity in the rig market, Total E&P Norge established a consortium to bring the Leiv Eiriksson semisubmersible rig back to Norwegian waters

through a 170 km long AC electric cable running from the shore at Kollsnes.

ThE PROjECT ORGANiSATiON is now well established, and the major contracts are awarded. Development drilling over the preinstalled jacket is planned to start in 2014. The Martin Linge project once again establishes the Company as a significant operator in Norway, and Total E&P Norge is actively recruiting in the Norwegian market

iN ThE NON OPERATEd portfolio, the Company’s single most valuable asset is the Greater Ekofisk Area, with ConocoPhillips as operator. The Ekofisk Quarters, Ekofisk South and Eldfisk II projects were all sanctioned in 2011. These projects, for the construction of a new living quarter and a large new wellhead platform on Ekofisk, and the redevelopment of Eldfisk, are progressing well. WE AlSO PARTiCiPATE in several new development projects operated by Statoil, including the Åsgard subsea compression project pioneering this technology, the Gina Krog field development and a number of the Statoil ‘fast track’ projects involving tieback of satellite discoveries to existing host facilities. As license partner, the Company always seeks to play an active and constructive role.

TOTAl UNdERTAkES a substantial Research and iN TERMS Of OPERATEd dEvElOPMENTS, 2012 will be seen as a turning point for TOTAL in Norway.

fiRST Of All we successfully brought on stream the fast track Atla project, a small satellite field connected to Heimdal via our operated Skirne field, only 2 years after discovery.

SECONdly A MAjOR MilESTONE was achieved with the June approval in the Storting of the Plan for Development and Operation (PDO) for the Martin Linge field. Martin Linge is a technically challenging development of a deeper gas/condensate field, overlain by a shallower oil reservoir. Production start-up is set for late 2016, with a steel jacket based Production, Utilities and Quarters platform together with a tanker for storage and offloading of the oil. Gas is sent via a new pipeline to the existing FUKA pipeline to St Fergus in Scotland. The platform power requirements will be supplied

Development (R&D) effort in Norway, with basis in a dedicated research centre in Stavanger. In 2012, the total R&D-budget was at a record level of 285 MNOK, which is second only to Statoil in Norway. It is TOTAL’s policy to make new technology available and share it when needed in the licences.

ThE NORWEGiAN oil and gas industry recently celebrated the 40th anniversary of first production from the Ekofisk field. There is every reason to believe that the industry’s future will continue for at least another 40 years into the future. It is TOTAL’s clear ambition to actively participate with all our human, technical and financial resources in the search for new possibilities that will extend this even further.

Martin Tiffen Managing Director Total E&P Norge AS

ThE bOARd Of diRECTORS’ REPORT

iNTROdUCTiON

TOTAL E&P NORGE AS (Total E&P Norge), a wholly-owned subsidiary of the Francebased TOTAL Group, is engaged in exploration for and production of hydrocarbons on the Norwegian Continental Shelf. The Board of Directors’ report and the accounts have been prepared based on the Company’s continuity as a going concern, and in the opinion of the Board of Directors this is justified. 2012 has been an active and successful year for Total E&P Norge. We have continued to build on our solid platform of long-term presence and knowledge of the Norwegian Continental Shelf. As an operator, we: Submitted the Plan for Development and Operation (PDO) for Martin Linge to the Norwegian authorities in January 2012 and received approval from the Storting on 11 June, Started production on the Atla field in October, on schedule and budget, just two years after discovery, Drilled a successful exploration well on the Garantiana prospect in the North Sea, Submitted applications in the Awards in Predefined Areas 2012, which resulted in an offer of four new operated licences and four as partner, all in the North Sea. As a partner, the main events included Partnership approval of the Dagny project PDO in December and subsequent submittal to the authorities the same month. Drilling of the King Lear prospect in the North Sea, resulting in an important discovery Installation of jackets and bridges on the Ekofisk complex in preparation for the new Living Quarters and Ekofisk Zulu drilling platform topsides to be installed in summer 2013 Concerning health, safety and environment (HSE), Total E&P Norge met its main objective, avoiding any fatal or serious accidents in 2012, in an environment characterised by high activity and rigorous demands. Production in 2012 was at an annual average of 275 thousand barrels of oil equivalents per day, a decline of 4.2% compared to the previous year. Slightly higher realised prices

for gas and similar prices for oil compared to 2011 leads to a satisfactory year in terms of financial results. The considerable work and effort by our staff within the existing perimeter of activity, together with awards in the licensing rounds, confirm the Company’s dedication to and strength on the Norwegian Continental Shelf.

ACTiviTiES ON ThE NORWEGiAN CONTiNENTAl ShElf

ExxONMObil SWAP In a process of rationalising their respective licence portfolios, Total E&P Norge and ExxonMobil Exploration and Production Norway AS (ExxonMobil) entered into an Exchange Agreement on 4 October 2012. The agreement involved the entire Total E&P Norge interests in the Tampen area; PL089 (5.6%), Snorre Unit (6.18%), Vigdis and Tordis (5.6%), Sygna (2.52%) and Statfjord Øst (2.8%). From ExxonMobil, Total E&P Norge received their entire interest in the Oseberg field (4.7%) and Oseberg Transportation system (4.33%), together with their entire interest in PL029C (100%) and PL29B (30%) containing the undeveloped Dagny discovery. The agreement was balanced out with a minor cash element from Total E&P Norge to ExxonMobil. The Agreement was approved by the Norwegian authorities in November and the transaction was completed on 3 December 2012. It had no material impact on 2012 production

liCENSiNG ROUNdS On 3 February 2012, Total E&P Norge was officially awarded shares in eight new licences, all located in the North Sea, in the Awards in Predefined Areas (APA) 2011. This award was in line with the Company’s application, and resulted in five operatorships; PL618 (60%), PL619 (50%), PL102E (40%), PL102D (40%) and PL 627 (40%). Finally, the Company was awarded interest in three licences operated by Statoil; PL193E (5%), PL046D (10%) and PL104B (10%).

On 6 September, Total E&P Norge submitted an application for new licences in APA 2012. On 15 January 2013, and again in line with the Company’s application, Total E&P Norge was offered shares in eight new licences, all in the North Sea. Four were offered as operatorships. Three are in the Greater Ekofisk area, PL661 (60%), PL662 (60%) and PL667 (50%) respectively, and one in the Tampen Spur Area, PL685 (40%). Three licences will be operated by Statoil: PL675 (40%) located west of Grane and Ringhorne, and two extensions of existing licences, PL190B (10%) and PL684 (5%) in the Kvitebjørn licence. The last licence, PL676S (20%) in the same area as PL675, will be operated by Faroe Petroleum. On 4 December, the Company submitted an application for new licences in the 22nd Licensing Round. The awards are expected to take place before summer 2013.

PORTfOliO The overall effect after the ExxonMobil swap and the 2011 and 2012 APA rounds is: Participation in 99 Licences, 27 as Operator Participation in 29 Producing fields

MARkETiNG ANd TRANSPORTATiON On 21 December 2012, Total E&P Norge endorsed the Final Investment decision in the new 480-km Polarled gas transportation system from the Statoil-operated Aasta Hansteen development in the Norwegian Sea to Nyhamna. The pipeline will also facilitate Linnorm, where the Company holds a 20% interest, as well as several other fields in the Norwegian Sea. The Plan for Installation and Operation was submitted to the authorities on 8 January 2013. Planned start-up is in 2016 with Statoil as operator for the construction phase. Total E&P Norge holds a 5.11% interest in the project. On 1 November 2012, Total E&P Norge entered into an 18-year time charter agreement with the owner of the LNG vessel Meridian Spirit. This agreement will enable the Company to both fulfil its lifting commitments from Snøhvit and its sale and purchase agreement commitments towards its buyer, TOTAL Gas & Power

ExPlORATiON dRilliNG OPERATEd In 2012, Total E&P Norge joined and worked in a rig consortium administered by Rig Management Norway. The Company acted as lead Operator in the tender process and contract negotiations. The Leiv Eiriksson rig has been secured for a 3-year contract starting around 1 April 2013, providing Total E&P Norge with rig capacity to drill two exploration wells per year. In December 2012, the exploration well on the Garantiana prospect (PL554) was successfully completed with the Borgland Dolphin rig. The prospect is located 30 km northeast of the producing Visund field. Oil was encountered in the Lower Jurassic and a successful production test was performed. A sidetrack was also carried out to establish the oil/water contact. Preliminary estimates are between 4 and 12 million Sm3 of recoverable oil.

with 95 beds. Final oil-water separation will take place on a Floating Storage and Offloading vessel, before the oil is offloaded to shuttle tankers. The FSO is moored on the field and connected to the platform through infield flowlines, an umbilical, a fuel gas line and a power supply cable. The gas from Martin Linge will be exported via a new 24” pipeline that will be connected to the Frigg UK Pipeline (FUKA) and Frigg UK Terminal at St. Fergus in Scotland. Power will be supplied through a 160-km long subsea AC cable from Kollsnes to Martin Linge. Production start from the field is planned in 4Q 2016. The Martin Linge Basic Engineering commenced in August 2011 with Aker Solutions and was completed in December 2012. This provides the basis for the execution phase and EPC tenders. Several major contracts were awarded during 2012. A contract for a new-build jack-up rig was formally signed with Maersk Drilling in July, the SURF contract was signed with Subsea 7, and the topsides with Technip/Samsung, transport and installation with Heerema. The logistics contracts for the drilling and operational phase (helicopter transport, supply and standby vessels and base services) were also awarded.

OPERATEd by OThERS Total E&P Norge participated in the drilling of two exploration wells operated by others on the Norwegian Continental Shelf (NCS) during 2012. Both were operated by Statoil. The drilling of the King Lear prospect in PL146/333 encountered the main Upper Jurassic objective gas bearing. A sidetrack was drilled to prove the gas/water contact. The size of the discovery is estimated to be between 11 and 32 million Sm3 of oil equivalents. The Crux Prospect in PL053 encountered the main Triassic objective water-bearing. However, a thin oil column was proven in the Statfjord Formation.

hiGhliGhTS - dEvElOPMENT PROjECTS, EvAlUATiONS ANd OPERATiONS OPERATEd MARTiN liNGE (fORMERly hild) The Martin Linge PDO/PIO was submitted to the Ministry of Petroleum and Energy on 19 January 2012, followed by the concession application for electric power supply from shore, submitted to the Norwegian Water Resources and Energy Directorate in March. The PDO/PIO was approved by the Norwegian Storting on 11 June 2012. The Martin Linge development concept consists of an eight-legged jacket with platform topside facilities for hydrocarbon processing, gas export and living quarters

ThE MARTiN liNGE PdO/PiO WAS SUbMiTTEd TO ThE MiNiSTRy Of PETROlEUM ANd ENERGy ON 19 jANUARy 2012 ANd APPROvEd by ThE NORWEGiAN STORTiNG ON 11 jUNE 2012 ATlA The Atla fast-track project was successfully brought on stream on 7 October 2012, less than 2 years after the discovery in October 2010. The field development consists of a single production well (re-entry of the exploration well), a 7-km pipeline and umbilical tied back to the existing Byggve template. Some modifications on the tie-in host Heimdal have been carried out by the host operator, Statoil. Production has been according to plan from start-up and throughout the remaining months of 2012, with a flow between 3 and 4 Msm3/d.

SkiRNE The Skirne field produced steadily until September 2012, when which the field was shut in to allow tie-back and production start-up of the Atla field. The plan is to restart production from the Skirne field as soon as the reservoir pressure from Atla is sufficiently low to allow commingled production. This is expected to take place in 1H 2013.

OPERATEd by OThERS – STATOil bARENTS SEA The Snøhvit LNG facilities continued to suffer unplanned outages. In order to improve regularity of the existing LNG train, a Snøhvit improvement project was launched to enhance plant performance and availability. The aim of a first phase is to have improvements ready for implementation during the planned 2014 shutdown.

OPERATEd by OThERS – STATOil ANd ShEll NORWEGiAN SEA On Åsgard, the subsea compression project continued as planned during 2012. The Shelloperated Linnorm development in PL255 was stopped in September 2012 due to major cost increases during the FEED phase. The final investment decision, initially slated for end 2012, has been postponed to end 2014, depending on a positive outcome of the Onyx South exploration well which will be spudded in spring 2013.

OPERATEd by OThERS – STATOil, MARAThON ANd CENTRiCA NORTh SEA The Visund field continued to experience several months of reduced production in 2012 due to riser replacements. Several more risers will have to be replaced in the coming years. Visund South, a subsea tie-back to Gullfaks C and the first of Statoil’s fast-track projects, started production in November 2012. The Visund North fast-track project is ongoing and first oil is expected in late 2013. In the Heimdal area, the Heimdal gas wells were closed in at the end of 2011 due to integrity concerns. The condensate export pipeline to Brae was shut down in July 2012 due waxing. The condensate is currently rerouted to the Sture terminal via the Grane field. Vale recommenced production via this export route. Centrica took over the operatorship of Vale on 30 April 2012, following a deal with Statoil. Vilje has been producing better than planned. Marathon took over the operatorship on 1 October 2012 and is now conducting the Vilje Sør development in co-operation with Statoil. Vilje Sør consists of an infill well on the Vilje field tied in to existing infrastructure on the seabed. It is expected to be on stream in late 2013. The new well on the Glitne field was not successful. This result, combined with issues with the subsea facilities, led to a decision to permanently close in the field. The last production is expected in February 2013. Following unitisation, the Dagny field PDO was approved in the partnership in December 2012 and submitted to the authorities. The Dagny development consists of a manned jacket-based platform where oil is processed on the platform and offloaded from a floating

storage unit and the gas is transported to Sleipner A. Production start is expected in 1Q 2017. A decision to develop the nearby Eirin field has been postponed to 2013. On Oseberg, the operator continues to plan for a Delta Phase 2 development and a major long-term drilling rig commitment for the Oseberg Area. Both projects are scheduled for final investment decisions in spring 2013.

OPERATEd by OThERS – CONOCOPhilliPS GREATER EkOfiSk AREA The execution of the permanent new Ekofisk Accommodation and Field Centre Project continued throughout 2012. Fabrication of the two jackets and two bridges has been completed and the facilities were installed offshore at the Ekofisk Complex in July 2012. Fabrication of the topside is ongoing in Singapore (SMOE), with planned installation offshore at the Ekofisk Complex in July 2013. The cost forecast is within budget. The Ekofisk South Project objective (PDO approved by the Norwegian Storting in 2011) is to increase production and recovery by expanding infill production drilling and implementing water injection support in the southern area of the field. Fabrication of the jacket and the bridge is completed and the facilities were installed offshore at Ekofisk Complex in early September 2012. Fabrication of the topside is ongoing at Aker Egersund and installation offshore at Ekofisk Complex is planned in July 2013. Pre-drilling of producers started in October 2012. The pipeline and umbilical for the new subsea water injection facility (2/4VB) were installed during October 2012. Drilling of water injectors on 2/4VB started in July 2012. The project is progressing according to budget and on schedule, with first oil production planned for early 2014.

iN dECEMbER 2012, ThE ExPlORATiON WEll ON ThE GARANTiANA PROSPECT (Pl554) WAS SUCCESSfUlly COMPlETEd WiTh ThE bORGlANd dOlPhiN RiG The Eldfisk II Project objective (PDO approved by the Norwegian Storting in 2011) is to redevelop the Eldfisk and Embla fields to enable exploitation beyond 2015. A new wellhead, process and accommodation platform at the Eldfisk Complex is being built by Kværner Stord, and the topside bridges and jackets by Dragados Offshore in Cadiz. The new platform will be tied into the Eldfisk Complex. The existing platforms

at Eldfisk and Embla will be converted, modified and/or upgraded. A new jack-up drilling rig to perform the main drilling campaign has been contracted and is currently under construction at the Jurong yard in Singapore. The project is within budget and on schedule, with first oil production planned for January 2015. With the aim of increasing production and recovery rate, studies continue with the objective of redeveloping the Tor field to enable production beyond 2015. Studies addressing revitalisation of earlier produced fields, exploitation of existing discoveries and prospects have been completed and reported in 2012, with the objective of identifying potential new developments with a new gas hub for the area. The cessation work in the Ekofisk area has progressed on schedule and under budget during 2012, and work will continue in 2013.

3 3.1

fiNANCiAl hiGhliGhTS

COMMENTS ON ThE iNCOME STATEMENT

PROdUCTiON vOlUMES In 2012, the average daily quantities produced were 275 thousand barrels of oil equivalents (kboe) per day, 4.2% below the 2011 level when a yearly average production of 287 kboe per day was achieved. 42% of the yearly production came from gas production, equivalent to an average of 17.6 million standard cubic meters per day. Compared to 2011, the overall 2012 production level was impacted by the natural decline of the Ekofisk and Sleipner areas, partially compensated by higher Troll gas liftings. Some changes have also affected the Heimdal area (Skrine-Byggve declining and Atla start up in 4th quarter 2012). In 2012 the 39.9% interest in PL018 Ekofisk area remained the largest contributor in production terms, the equivalent of 32.7% of the company’s overall production.

REvENUES In 2012, yearly revenues were Norwegian Kroner (NOK) 51 109 million compared with NOK 51 326 million for 2011. Crude oil and gas sales were NOK 49 614 million in 2012 compared to NOK 49 129 million NOK in 2011, with good realisation prices offsetting the impact of lower volume. The average price achieved for oil and condensates was US dollar (USD) 112.6 per

barrel, constant compared to the USD 112.89 per barrel average price achieved in 2011. Revenues from oil and other liquids were NOK 36 323 million compared to NOK 37 263 million in 2011. Booked gas revenues reached NOK 13 291 million in 2012, up from NOK 11 866 million, in 2011.

iN 2012 ThE 39.9% iNTEREST iN Pl018 EkOfiSk AREA REMAiNEd ThE lARGEST CONTRibUTOR iN PROdUCTiON TERMS, ThE EqUivAlENT Of 32.7% Of ThE COMPANy’S OvERAll PROdUCTiON. The yearly average price of gas delivered by the Company in 2012 (including LNG) increased from 9.68 to 10.11 $/mmbtu compared to 2011. For gas delivered under long-term sales agreements, prices were globally constant. Price for spot gas sales showed a slight improvement compared to 2011. LNG sales prices increased as a result of commercial optimisation of the sold LNG cargoes from the Snøhvit LNG plant. The Company’s income was positively impacted in 2012 by the evolution of the NOK/USD. The Company’s accounts are denominated in NOK whilst all liquids sales are invoiced in USD and gas sales predominantly are invoiced in Euros (EUR), pounds sterling or USD. The average exchange rate for NOK/USD was 5.82 up 3.9% compared to 5.6 in 2011. The average NOK/EUR exchange rate was 7.5 down 3.8 % compared with 7.8 in 2011. Tariff income of NOK 529 million includes transportation tariffs and processing fees. They are 75% below the NOK 2 076 million realised in 2011 following the disposal of Gassled in 2011. The evolution of the items ‘sundry income’ and ‘other operating cost’ is principally linked to the assets transactions performed in the last two years. The ExxonMobil swap transaction has been booked as a sale and an acquisition at completion date (beginning of December 2012). The sale part of the transaction has contributed to a one-off positive net result of about NOK 1 billion, recorded in part as ‘sundry income’ and in part as current and deferred tax. During the year 2011, Total E&P Norge had sold its participating interest in Gassled assets to Silex Gas Norway AS. This sale had contributed to a one-off positive net result of about NOK 2 billion, recorded in part as ‘other operational costs’ and in part as current and deferred tax.

OPERATiNG ExPENSES After deduction of charges to partners, net operating costs were NOK 17 913 compared to NOK 15 141 million in 2011. This increase results in large part from the one-off changes done in 2011 in the Company’s valuation methodology regarding the underlift /overlift position for oil, gas, condensate and LNG, being valued at the last known prices at the closing date instead of their production cost. Applying this new approach, the product stock variation was increased in 2011 by NOK 3 221 million. The accrued effect after tax of this change was NOK 680 million. In 2012, this last known price valuation methodology has been consistently applied and the variation of the underlift position has had a positive effect on the operating income of NOK 321 million, due to both increased quantities in the underlift position and increased market prices. All Total E&P Norge’s 2012 exploration drilling has been considered as successful and related expenditures have therefore been capitalized for further economical evaluation. Total E&P Norge has, in addition, increased its exploration effort in geological and geophysical surveys and in purchases of seismic data leading to higher exploration expenses in 2012 compared to 2011. Production and transportation expenses are lower than in 2011, the exploitation costs of owned transportation assets being reduced after the Gassled disposal at the end of 2011. Provisions for well plugging, dismantlement and removal charges are increasing due to additional new assets in service (Atla, Visund South) and higher estimated well plugging costs.

NET iNCOME The pre-tax profit for 2012 was NOK 32 838 million compared to NOK 35 971 million recorded in 2011. After taking into account current and deferred taxes of NOK 23 417 million, the net profit for the year was NOK 9 421 million compared with NOK 9 709 million in 2011.

3.2

COMMENTS ON ThE STATEMENT Of CASh flOWS

CASh flOWS Cash flow from operations was NOK 17 093 million compared to NOK 19 276 million in 2011. After working capital variation, significantly impacted in 2012 by the cash settlement in January 2012 of the Gassled sale transaction made in 2011, increased tax payments and, in 2011, by changes in working capital related to the net underlift

position, the net cash provided by operating activities has been stable between 2011 and 2012 at about NOK 17 billion per year.

iNvESTMENTS Investments totalled NOK 16 202 million (including exploration, appraisal and acquisitions), which represents a 55% increase compared with the NOK 10 410 million in 2011. This is due to growing development expenditures, a larger exploration effort and acquisitions of new interests. The largest development investments were linked to facilities and drilling for the Ekofisk Area (in particular the new projects related to Ekofisk South and Eldfisk II), the completion of the development project of Atla and the engineering phase of the Martin Linge development project. In addition Total E&P Norge increased its exploration effort both in drilling and seismic acquisitions.

iNvESTMENTS TOTAllEd NOk 16 202 MilliON (iNClUdiNG ExPlORATiON, APPRAiSAl ANd ACqUiSiTiONS), WhiCh REPRESENTS A 55% iNCREASE COMPAREd WiTh ThE NOk 10 410 MilliON iN 2011 SAlES Of ASSETS Total E&P Norge sold its shares in Gasnor mid 2012 to Shell Norge AS. As previously mentioned the ExxonMobil swap transaction closed in December 2012.

in Oseberg and the transfer of assets related to the new fields coming in production in 2012 (Atla, Visund South). The licence acquisitions have been increased with the acquisition of Oseberg and Dagny mining rights. Transport and other equipments have increased due the recognition as financial lease of a LNG carrier chartering agreement entered as from 1st November 2012.

CURRENT ASSETS Total current assets have decreased to NOK 10 027 million compared to NOK 12 191 million in 2011. This decrease is due to the cash settlement of the 2011 year-end receivable position related to the Gassled sale transaction. The underlift position has increased from NOK 3 643 million to NOK 3 964 million.

EqUiTy ANd liAbiliTiES Total equity has increased by NOK 421 million to NOK 7 119 million after allocation of the proposed dividend. The total equity represents 10.2% of the total balance sheet at the end of 2012. Total liabilities have increased by NOK 7 122 million to NOK 62 847 million, mainly due to the increase in financial long term liabilities partially dampened by the reduction of its tax payable position.

PROPOSEd dividENd A dividend distribution of NOK 9 000 million is recommended.

3.4

COMMENTS ON ThE fiNANCiAl RiSkS

fiNANCiNG All funding requirements for the year were met from internal group resources. At year-end, loans and overdraft facilities were in place with an affiliated company for NOK 10 000 million. The actual cash flow needs have led to increased drawings and to a long term borrowing position of NOK 9 000 million at year end.

3.3

COMMENTS ON ThE bAlANCE ShEET

MARkET RiSk The Company is exposed to changes in currency exchange rates, in particular USD and EUR, as the Company’s revenues are largely in these two currencies, and to changes in oil and gas prices. The Company hedges the exposure on recognised crude oil sales in foreign currencies and on a significant portion of its gas sales. The Company is also exposed to changes in interest rate levels, as the Company’s debt is subject to a floating interest rate.

fixEd ASSETS

CREdiT RiSk

Total fixed assets after depreciation and amortisation have increased to NOK 59 939 million in 2012 compared to NOK 50 232 million in 2011. Total E&P Norge has increased its assets in progress as a consequence of its substantial development and exploration program. The producing assets have been reduced due to the disposal of the Tampen area participating interests, this effect being partially offset by the acquisition of interests

Risk associated with the inability of counterparties to fulfil their obligations is considered low, as the Company’s sales are mainly to group companies and other large corporations. The Company has not realised losses on receivables in previous years.

liqUidiTy RiSk The Company’s liquidity is considered satisfactory. It is anticipated that the Company

will be able to fund its future cash requirements through cash-flows from operations and funding loans within the TOTAL Group.

EMPlOyEES ANd ORGANiSATiON

At the end of 2012, the total number of staff employed by the Company was 369. This figure includes 265 local employees, 66 expatriated staff and 6 integrated contactors in the Total E&P Norge organisation. There are also 32 employees assigned abroad or to partners in Norway included in the total figure.

ThE TOTAl E&P NORGE ORGANiSATiON iS vERy iNTERNATiONAl. AT yEAR-ENd, 25 diffERENT NATiONAliTiES WERE REPRESENTEd. divERSiTy ANd iNTERNATiONAliSATiON hAvE bEEN PRiORiTy AREAS fOR SEvERAl yEARS ANd ARE PART Of OUR lONG-TERM STRATEGy The Company pay particular attention to the employees’ working conditions, respecting individuals, avoiding discrimination, and protecting their health and safety. Personnel are solely recruited on the basis of our requirements and the specific capabilities of the individual applicants. Total E&P Norge develop their professional skills and careers without discrimination regarding race, gender, or affiliation with a political, religious, or union organization or minority group. Total E&P Norge is preparing its organisation for new operated activity in the ongoing development and eventually the production phase of the Martin Linge. An extensive recruitment and training process is ongoing, and will last for several years. The current labour market is tight, but the Company will not compromise as regards the required competence and qualifications. In addition to recruitment, considerable effort is being directed towards providing development opportunities for employees already in the organisation. The Total E&P Norge organisation is very international. At year-end, 25 different nationalities were represented. Diversity and internationalisation have been priority areas for several years and are part of our long-term strategy. Our local staff includes a total of 107 women. At senior position levels, 22% of the employees are women. The Company recruited 36 new employees in 2012.

Eleven persons work part-time for the Company, of which nine are women. All remaining staff are in full-time positions. 38% of the local employees were union members belonging to TEKNA or IndustriEnergi Avdeling 268. Total E&P Norge is member of Norsk olje og gass, the Norwegian Oil and Gas Association, which is affiliated with NHO, the Confederation of Norwegian Enterprise.

APPliEd RESEARCh

The R&D centre in Total E&P Norge is the largest of five international R&D centres outside France within the Exploration & Production (E&P) branch of the TOTAL Group. All of these centres are part of an integrated research strategy. Total E&P Norge’s R&D objectives focus on challenges associated with the Norwegian Continental Shelf, covering three technical domains: subsurface including drilling and well technology, production and environment. The TOTAL Group provides access to the substantial research undertaken in France and elsewhere. The Norwegian Petroleum Directorate operates FORCE, a forum for reservoir characterisation, reservoir engineering and exploration technology cooperation. Total E&P Norge contributes in specialised subcommittees in FORCE. The Research Council of Norway runs two major R&D programmes aligned with the OG21 priorities: these are PETROMAKS, covering basic research, and DEMO2000, covering development and demonstration. Total E&P Norge takes an active role in both programmes, providing technical expertise, pilot testing opportunities and financial support for projects.

ThE COMPANy MET iTS MAiN ObjECTivE, AvOidiNG ANy fATAl OR SERiOUS ACCidENTS iN 2012 In addition to participation in research projects – usually within a joint industry project format – there is participation in the training of young professionals coming from both French and Norwegian universities. Through R&D co-operation with the Norwegian universities, Total E&P Norge financed and provided professional contributions to the supervision of seven students’ PhD projects in 2012.

hSE PERfORMANCE, OPERATEd ACTiviTy iN 2012

The Company met its main objective, avoiding any fatal or serious accidents in 2012. There was one Lost Time Injury (LTI) during the year. The corresponding frequency, LTIF, at 0.61, was within the objective of maximum 0.7. With two medical treatment incidents in addition to the LTI incident, the Total Recordable Injury Rate (TRIR) was 1.83. This met the annual objective of a TRIR below 2. The LTI incident occurred on a seabed survey vessel at Norvarg. While servicing equipment used for seabed penetration tests, a person was struck in the face by part of the equipment, causing injury to the face and teeth which required hospital treatment. The investigation concluded that the consequence, under slightly altered circumstances, could have been worse. This incident is therefore reported as one of two high potential incidents in 2012. The other high potential incident involved a dropped object on a subsea construction vessel. Due to the high activity level on marine vessels and the reported incidents, additional safety improvement actions have been implemented on vessels in 2012. Total E&P Norge has an annual HSE programme which includes activities to improve the HSE standard in operated activities. 93% of this programme was fulfilled, while the objective was 94%. A total of seven internal audits, 25 external audits and 15 verifications were performed during 2012. Seven management inspections on drilling rigs and marine vessels added to the high HSE activity. In 2012, a bi-yearly campaign assessing individual health risk related to cardiovascular illness, diabetes and lifestyle was carried out. 180 employees participated. A screening campaign related to early detection of colon and prostate cancer among persons aged 50+ was also performed. The same relates to the annual campaign promoting physical activity. A weekly, individual activity program aimed at preventing neck, shoulder and back problems was also carried out amongst employees. Absence due to illness in the Company was 2.0%, compared with 1.9% in 2011. The total absence (employees’ illness + leave due to own children’s illness) was 2.4%. The Company has a Rehabilitation Committee that is responsible for providing relevant assistance to employees suffering from long term illness.

ChEMiCAl USE ANd diSChARGES fROM dRilliNG / 2012 (TonneS)

ATlA USEd

ExPORTEd diSChARGEd

GARANTiANA USEd

ExPORTEd diSChARGEd

USEd

ExPORTEd diSChARGEd

Total Green Substances

227.1

148.4

2 693.2

42.0

586.5

2 920.3

734.9

Total Yellow Substances

74.4

6.2

566.6

3.7

14.6

641.0

3.7

20.7

0.036

0.0036

2.4

0.0012

1.6

0.0048

Total Red Substances Total Black Substances

ENviRONMENTAl ACCOUNTS ANd iMPACT

The objective of no harmful impact on the marine environment was achieved for the Atla drilling operations. For the Garantiana drilling operations, the analysis is not yet completed. However, there is so far no indication that the objective will not be met. There was one spill subject to the mandatory Petroleum Safety Authority Norway notification in 2012. While drilling the Garantiana exploration well, an accidental spill of 50 litres of hydraulic oil from the BOP crane occurred. As the hydraulic oil did not have an HOCNF, it is automatically classified as a black spill and the notification requirement therefore applies. Environmental impact assessments or risk assessments for our activities have been undertaken on a regular basis. These have been based on offshore environmental monitoring and detailed knowledge of inventories and the environment around our operation sites, as well as the probability,

duration and estimated quantity for a blowout scenario, when applicable. Based on the conclusions of these assessments and the principle that the Company always adheres to the regulatory requirements and Company rules, whichever are more stringent, we are confident that Total E&P Norge practices sound management as regards the environmental impact of its activities. The certification according to the ISO 14001 standard was renewed in 2012. The recertification audit conducted by Det Norske Veritas Certification AS revealed only one minor nonconformity, which will be corrected before the periodic audit in 2013. Detailed information on our environmental accounts and their impact can be found in the annual discharge report submitted through the joint electronic reporting format for the Climate and Pollution Agency (Klif), the Norwegian Petroleum Directorate (NPD) and the Norwegian Oil and Gas Association (NOROG). This report is accessible from the NOROG website (www.norog.no). As regards the production and operation of the operated field Skirne, no major

NOx EMiSSiONS fOR OPERATiON ANd SUPPORT ACTiviTiES (TonneS)

CO2 EMiSSiONS fOR OPERATiON ANd SUPPORT ACTiviTiES (1 000 TonneS)

200

124

150

100

6.6

35.5 50

0 AtlA

TOTAl

gArAntiAnA

AtlA

gArAntiAnA

change in the emissions compared to the previous yearâ&#x20AC;&#x2122;s figures was recorded in 2012. The Atla field started producing in October. So far, the Skirne and Atla wells are not producing at the same time, which means that the annual contribution to the emissions from the Heimdal installation is about the same. The discharge accounts from both the Atla and Garantiana wells are provided in the table above, including environmental characterisation of the chemicals discharged. In addition to 4 837 tonnes of water-based mud and cuttings from Atla and Garantiana, disposed of on site, a total of 4Â 233 tonnes of oil-based mud, water-based mud and cuttings were brought to shore for treatment. The CO2 and NOx emissions from our operated activities in 2012 are illustrated in the figures below. The CO2 emissions from Atla are subject to CO2 quotas.

OUTlOOk fOR 2013

Total E&P Norge attaches high importance to corporate social responsibility and the due compliance by all Company staff and our cooperating partners with the Ethics Charter and Code of Conduct determined by the TOTAL Group. The Board is of the opinion that 2013 will be a significant year for Total E&P Norge as it builds towards a greater role as operator on the Norwegian Continental Shelf (NCS), and as it enters into the execution phase of the Martin Linge project. Combined with a very high activity level in all parts of the organisation, the challenges in 2013 are many. The Board wishes to highlight a few of these: Meet the Company ambitions with regard to health, safety and the environment. Timely progress of the Martin Linge development project in close co-operation with our main contactors towards planned production start-up at the end of 2016.

Successfully complete the appraisal drilling of the operated Norvarg discovery in the Barents Sea with due consideration to both the stringent safety and environmental conditions that apply in the Barents Sea. It is hoped that this well can be a positive step in the direction of a possible future field development. Be an active and constructive partner with influence on key decisions within our portfolio of core non-operated licences. Special attention will be given to Ekofisk Accommodation, Eldfisk II redevelopment and the Ekofisk South projects to closely monitor the cost development and schedule. A positive outcome of our application in the 22nd Licensing Round. Continue the search for new licences and operatorships through applications and APA 2013, in addition to continued portfolio optimisation activities. Maintain and recruit the competence needed for our future activity level. With respect to the framework conditions on the NCS that affect our sector, the following may be highlighted: The increases in oil prices in 2007/2008 were associated with significant cost inflation on the NCS that has persisted into 2012. This causes concern in relation to the marginal profitability of many new field developments on the NCS. Although the oil price has rebounded during 2012, gas prices remain lower on an energy equivalent basis.

The Board takes note of the fact that the Minister of Petroleum and Energy will present a white paper to the Storting during spring 2013 proposing an opening of the Barents Sea Southeast and Jan Mayen for petroleum activity and inclusion in the 23rd Licensing Round. These measures, together with political signals of a possible re-opening of Nordland VI after the election of a new parliament in September 2013, will secure important and timely access for the petroleum industry to new acreage in prospective areas in northern waters. As large parts of the Norwegian Continental Shelf continue to mature, the emphasis will switch to the management of lifetime extension for maturing fields and facilities, particularly through the tieback of smaller satellite discoveries and/ or more challenging reservoirs. This requires an evolution in thinking, towards cost effectiveness, enabling technologies and greater standardisation of solutions. This must be addressed by all players in the industry – authorities, oil companies, contractors and service companies.

The Board’s general optimism for the future development of the Company, as expressed above, is based on its confidence in the quality and competence of the Company’s staff in Norway.

ACCOUNTS

The 2012 accounts and explanatory notes are presented in this annual report. We are not aware of any matters not dealt with in this report or the accompanying accounts that could be of significance when evaluating the Company’s position at 31 December 2012 and the results of the year thus ended. Taking into account the legal requirements, it is proposed that the Company’s net profit shall be distributed as follows: 2012 net income To retained earnings Dividend

NOK 9 421 000 000 NOK

421 000 000

NOK 9 000 000 000

The Company’s financial results in 2013 will probably, in light of the expected drop in production level due to the many forecasted field revisions and production stops, be lower than in recent years. The financial results will further depend on the expenditure targets and again are partially dependent upon prevailing hydrocarbon prices and foreign exchange rates.

ThE bOARd Of diRECTORS Of TOTAl E&P NORGE AS // 5 MArch 2013

PAtrice De ViViès

eric Denelle

oDD roger enoKsen

DoMinique PAul MArion

toM ruuD

Kristine holM*

line steinnes*

olAV steffensen*

MArtin tiffen

Pierre bousquet

chAirMAn

hArriett elizAbeth Dreyer*

* emploYeeS’ RepReSenTaTiveS

MAnAging Director

the Martin linge reservoirs

income statement Million nok

notes

2012

2011

49 614

49 129

485

529

2 076

(1 547)

966

121

845

51 109

51 326

(217)

Variance

reVenUes

Crude oil and gas sales Tariff income Sundry income

ToTAl REVEnUES oPeratinG eXPenses

Purchases of gas Salaries and employee benefits

3, 4

licence fees, royalties and governmental expenses Production and transportation expenses

105

186

(81)

736

628

108

459

481

(22)

7 982

8 122

(140)

Exploration expenses

612

237

375

General and administrative expenses

234

206

1 934

1 583

351

6 171

6 365

(194)

(321)

(3 221)

2 900

554

(551)

Provisions for well plugging, dismantlement and removal Depreciation, depletion and amortization

5, 6

Variation of product stock other operating cost

oPERATinG EXPEnSES

17 913

15 141

2 772

oPeratinG ProFit

33 196

36 185

(2 989)

FinanciaL income anD (eXPenses)

Financial income

(26)

Financial expenses

(364)

(206)

(158)

income from subsidiary and related companies

(24)

(70)

(133)

FinAnCiAl inCoME/(EXPEnSES) â&#x20AC;&#x201C; nET

(358)

(213)

(145)

orDinarY net income BeFore taXes

32 838

35 971

(3 133)

23 232

25 137

(1 905)

net exchange gains/(losses)

Taxes payable

Deferred taxes

net income

185

1 125

(940)

9 421

9 709

(288)

aLLocation

Dividend

9 000

9 600

(600)

Retained earnings

421

109

312

9 421

9 709

(288)

totaL aLLocation

BaLance sHeet Million nok / AT 31 DECEMBER

notes

2012

2011

Variance

2 813

794

2 019

2 813

794

2 019

FiXeD assets intanGiBLe assets

licence acquisitions ToTAl inTAnGiBlE ASSETS ProPertY, PLant anD eQUiPment

8, 10

Buildings

224

235

(11)

Producing assets – completed

39 648

41 188

(1 540)

Producing assets – in progress

12 416

5 573

6 843

Exploration wells – in progress

2 958

2 081

877

Transport – and other equipment

1 592

1 530

56 838

49 139

7 699

197

200

(3)

(7)

ToTAl PRoPERTY, PlAnT AnD EQUiPMEnT FinanciaL inVestments

long-term receivables ToTAl inVESTMEnTS

288

299

(11)

totaL FiXeD assets

59 939

50 232

9 707

cUrrent assets inVentories

Material and supplies

395

405

(10)

net oil/gas (overlift)/underlift

3 964

3 643

321

ToTAl inVEnToRiES

4 359

4 047

311

3 656

4 211

(555)

276

3 932

(3 656)

3 931

8 143

(4 212)

accoUnts receiVaBLe

Customers

other ToTAl ACCoUnTS RECEiVABlE CASH AnD CASH EQUiVAlEnT

1 737

totaL cUrrent assets

10 027

12 191

(2 164)

totaL assets

69 966

62 423

7 543

notes

2012

2011

Variance

Share capital (4 201 000 shares Ă 1 000.00)

4 201

Share premium

2 340

6 541

578

157

421

578

157

421

7 119

6 698

421

Million nok / AT 31 DECEMBER

eQUitY PaiD-in caPitaL

ToTAl PAiD-in CAPiTAl retaineD earninGs

Retained earnings

ToTAl RETAinED EARninGS totaL eQUitY

LiaBiLities LonG-term ProVisions

Pension obligations

699

520

179

Deferred taxes

15 475

15 337

138

Well plugging, dismantlement and removal

7, 15

ToTAl lonG-TERM PRoViSionS

11 126

10 324

802

27 299

26 180

1 119

otHer LonG-term LiaBiLities

long-term loans from associated companies

9 000

long-term loans from other companies

1 464

other long-term liabilities ToTAl lonG-TERM liABiliTiES

126

(116)

10 473

126

10 347

cUrrent LiaBiLities

overdraft facilities

404

(404)

Accounts payable and accrued expenses

3 899

3 066

833

12 005

16 246

(4 241)

9 000

9 600

(600)

Taxes other than income taxes income taxes payable Proposed dividend other short-term debt

120

ToTAl CURREnT liABiliTiES

25 074

29 418

(4 344)

totaL LiaBiLities

62 847

55 724

7 122

totaL eQUitY anD LiaBiLities

69 966

62 423

7 543

380

330

Guarantees

casH FLow statement Million nok

2012

2011

Variance

casH FLows From oPeratinG actiVities

net income before taxes

32 838

35 971

(3 133)

Current taxes on income

(22 451)

(25 137)

2 686

6 171

6 365

(194)

long-term provisions

1 330

1 548

(218)

loss / (gain) on sales of property, plant and equipment

(795)

529

(1 324)

17 093

19 276

(2 183)

Accounts receivable and prepaid expenses

4 212

(2 384)

6 596

inventories

(311)

(3 306)

2 995

Depreciation, depletion and amortisation

cash flows from operations

Cash increase/(decrease) from variations in:

Accounts payable and accrued liabilities Accrued taxes long-term receivables net casH ProViDeD BY oPeratinG actiVities

901

804

(4 241)

2 547

(6 788)

(5)

17 661

16 948

713

(16 202)

(10 410)

(5 792)

casH FLows From/(to) inVestinG actiVities

Capital expenditures Proceeds from sales of property, plant and equipment

1 478

3 788

(2 310)

(14 724)

(6 622)

(8 102)

increase/(decrease) in associated long-term liabilities

9 000

(1 000)

10 000

increase/(decrease) in other long-term liabilities

(197)

(3)

(194)

net casH UseD in inVestinG actiVities casH FLows From/(to) FinancinG actiVities

increase/(decrease) in overdraft facilities

(404)

404

(808)

Dividend paid to shareholder

(9 600)

(9 400)

(200)

net casH FLows From/to FinancinG actiVities

(1 201)

(9 999)

8 798

1 737

328

1 409

328

(328)

1 737

net increase/(decrease) in cash and cash equivalents

Cash and cash equivalents at 01.01 casH anD casH eQUiVaLents at 31.12

accoUntinG PoLicies The financial statements are presented in accordance with the regulations in the Accounting Act and norwegian Generally Accepted Accounting Principles. reVenUe recoGnition. Revenues associated with sales and transportation of hydrocarbons is recognised when title passes to the customer at the point of delivery of the goods based on the contractual terms of the agreements. other services are recognized at the time of delivery. Joint VentUres. The Company’s shares in joint ventures are booked under the respective lines in the profit and loss statement and the balance sheet. The income statement of Total E&P norge AS reflects the Company’s net share of operations. BaLance sHeet cLassiFication. Current assets and short-term liabilities consist of receivables and payables due within one year after transaction date. other balance sheet items are classified as fixed assets / long-term liabilities. Current assets are valued at the lowest of acquisition cost and fair value. Short term liabilities are recognized at nominal value. Fixed assets are valued at cost, less depreciation and impairment losses. long term liabilities are recognized at nominal value. ForeiGn cUrrencY transLation. Transactions in foreign currency are translated at the rate applicable on the transaction or invoicing date. Monetary items in a foreign currency are translated into nok using the exchange rate applicable on the balance sheet date or, if covered by forward currency exchange contracts, at the contract rate. Changes to exchange rates are recognized in the income statement as they occur during the accounting period. casH anD casH eQUiVaLents. Cash and cash equivalents includes cash, bank deposits and other short term highly liquid investments with maturities of three months or less. intanGiBLe assets, ProPertY, PLant anD eQUiPment. Costs related to intangible assets, property, plant and equipment are capitalized and depreciated linearly over the estimated useful life. Maintenance is expensed as incurred, whereas costs for improving and upgrading property plant and equipment are added to the acquisition cost and depreciated with the related asset. Depreciation charges for licence acquisitions, offshore and onshore production installations, booked under operating expenses, are determined by the unit-of-production method. other onshore property, plant and equipment are depreciated by use of the declining balance method. if carrying value of a non current asset exceeds the estimated recoverable amount, the asset is written down to the recoverable amount. The recoverable amount is the greater of the net realizable value and value in use. in assessing value in use, the discounted estimated future cash flows from the asset are used. eXPLoration. Exploration costs are treated in accordance with the successful effort method, with the well as basis for the evaluation. Exploratory drilling costs are capitalized pending the determination of whether the wells found proved reserves. if the wells are determined commercially unsuccessful costs are expensed as depreciation. Geological and geophysical costs are expensed as incurred. researcH anD DeVeLoPment. Research and development costs are expensed as incurred. caPitaLization oF interest costs. interest costs incurred in connection with the financing of development projects, individually stipulated to accumulate expenditures in excess of nok 800 million are capitalized as part of the development costs.

LeasinG commitments. leases transferring substantially all the risks and rewards incidental to ownership from the lessor to the lessee are treated as financial leases. These contracts are capitalized as assets at fair value, or if lower, at the present value of the minimum lease payments according to the contract. A corresponding financial debt is recognized. These assets are depreciated over the shortest of the estimated economical life time of the asset and the leasing period. leasing agreements without transfer of substantially all the risk and control to the lessee are considered as operating leases. The Company’s leasing costs in operating leases are reflected as operating expenses. sHares. The investment is valued as cost of the shares in the subsidiary, less any impairment losses. An impairment loss is recognized if the impairment is not considered temporary, in accordance with generally accepted accounting principles. impairment losses are reversed if the reason for the impairment loss disappears in a later period. The operations of the subsidiaries are considered immaterial compared to the level of the company’s business, and consolidated accounts have therefore not been prepared. Group accounts are prepared by the holding company ToTAl S.A. resident in France. inVentories. Consumable inventories consist of equipment for exploration and field development, and are calculated at average purchase prices. Spare parts are charged to operations when acquired. oVer-/UnDerLiFtinG. As from 2011 the overlift and underlift of petroleum products is valued at sale price and presented as current assets in the balance sheet. FUtUre weLL PLUGGinG, aBanDonment anD remoVaL costs . Annual provisions are made to meet future costs for decommissioning, abandonment and removal of installations. Provision requirements are reviewed on an individual field basis, and the net present value of future costs is the basis for the recognized obligation. Changes in time element (net present value) of the abandonment provision are expensed annually and increase the obligation in the balance sheet. Changes in estimates are recognized over the remaining production period, unless the production is for material purposes completed. in such a case the change in estimate is recognized immediately. Pensions. Defined benefit plans are valued at the present value of accrued future pension benefits at the balance sheet date. Pension plan assets are valued at their fair value. Changes in the pension obligations due to changes in pension plans are recognized over the estimated average remaining service period. The accumulated effect of changes in estimates and in financial and actuarial assumptions (actuarial gains or losses) exceeding 10% of the higher of defined benefit pension obligations and pension plan assets at the beginning of the year, is recognized in the income statement over the estimated average remaining service period. The net pension cost for the period is classified as salaries and personnel costs. income taX. income taxes reflect both current taxes and taxes payable in the future as a result of the current year’s activity. When calculating the deferred taxes, the company uses the liability method, under which deferred taxes are calculated applying legislated tax rates in effect at the closing date. Earned future deductible uplift allowance is offset against the special tax when calculating deferred taxes. casH FLow statement. The statement of cash flow has been prepared in accordance with the indirect method as per the temporary norwegian accounting standard.

notes

crUDe oiL anD Gas saLes Million nok

2012

2011

Crude oil

32 454

33 576

nGl

2 703

2 723

Gas

13 291

11 866

1 166

964

49 614

49 129

Condensate Total

Most sales of petroleum products are within Europe with some lnG cargoes sold in other markets. The main part of the oil and liquids sales are to Group companies.

02 03

sUnDrY income / otHer oPeratinG costs in 2012, Total E&P norge AS entered into asset exchange agreement with ExxonMobil Exploration and Production norway AS (ExxonMobil) for its participating interest in most of Tampen area assets, in exchange of ExxonMobilâ&#x20AC;&#x2122;s interest in oseberg and Dagny assets. Effective date of the transaction was 1 January 2012. For accounting purpose the closing is 3 December 2012. The transaction has been booked as a sale and an acquisition.

During the year 2011, Total E&P norge AS had sold its participating interest in Gassled assets to Silex Gas norway AS. This sale had contributed to a one-off positive net after tax result of about 2 Bnok.

saLarY, emPLoYee BeneFits, nUmBer oF emPLoYees 2012

2011

Salaries

420

356

Social security and other benefits

129

100

Million nok

Pension cost

other

110

Total salaries and employee benefits

736

628

Average number of full-time employments

322

289

Fees paid to the Board of Directors in 2012 amounted to nok 582 500. Salaries and remunerations to the Managing Director amounted to nok 5 594 274 in 2012. There are no agreements with the Managing Director or The Board of Directors for special bonuses or separate remuneration in connection with termination. The General assembly of ToTAl S.A. has decided restricted share plans and share subscription option plans. The restricted shares plan is subject to certain conditions of economic

The sale has contributed to a one-off positive net after tax result of about 1 Bnok.

performance of the ToTAl S.A. group after a vesting period. Certain employees of Total E&P norge AS were invited to participate in the plans. Given the immaterial value of the benefits, no expense has been recognized in the accounts. long-term receivables contain loans to employees of nok 25 million. Total E&P norge AS have also issued a guarantee to nordea for loans to Total E&P norge AS employees of total nok 380 million as per 31.12.2012. no company loans were granted to the Managing Director.

emPLoYee retirement PLans The Company maintains a collective benefit retirement plan with DnB. The plan gives all employees on national payroll (287 at 31.12.12), a right to receive defined future pensions. in addition, this plan also includes retired personnel (237 at 31.12.12) who receive defined future pensions. Employees

under French and other benefit plans are the responsibility of other related companies. Total E&P norge AS is charged with the net periodic pension costs covering those employees. The Company also has partly unfunded plans for certain employees with higher salary.

Million nok

Service cost interest cost Return on pension plan assets Amortized prior service cost net periodic pension cost

2012

2011

(52)

(54)

146

136

net FUnDeD Pension PLan

net UnFUnDeD Pension PLan

1 617

1 548

880

348

tHe FoLLowinG statement Presents tHe statUs oF tHe PLans at 31 DecemBer 2012: Million nok

Projected benefit obligation Pension plan assets net projected pension assets (obligation)

(737)

(1 200)

Unrecognised actuarial (gains)/losses

734

504

net pension asset/(provision)

(3)

(696)

2012

2011

Discount rate

2.5 %

2.5â&#x20AC;&#x201C;3.4 %

Projected wage increases

4.0 %

Projected Pension regulation

3.8 %

Projected return on plan assets

2.5 %

4.8 %

net unfunded plans are presented under long-term provisions.

tHe actUariaL Present VaLUe Has Been caLcULateD UsinG tHe FoLLowinG assUmPtions:

Total E&P norge AS is obliged to follow the law on mandatory pension obligations. The pension scheme satisfies the requirement in this Act.

05 06 07 08

aUDitor The audit fee for work performed in 2012 amounted to nok 4 486 000 excl VAT, of which nok 2 670 000 was for audit

related services, nok 150 000 for other attestation services and nok 1 666 000 for income tax and VAT advice.

ProDUction anD transPortation eXPenses operating costs reflect a compensation – of nok 440 million for 2012 – as part of the exchange of participating interests on the norwegian Continental Shelf in 1988. in 2012 the Company has incurred expenses of nok 104 million on Research and Development activities. The Company’s R&D program is a part of the ToTAl Group plan and is aimed at improving the value of our current and future investments on the norwegian Continental Shelf. The focus is on improving

understanding, developing new methodologies, models and hardware in the areas of enhanced oil recovery, reservoir/ well monitoring, flow assurance and environmental assessment/monitoring. The program of work is accomplished through joint industry projects collaboration with norwegian universities and institutes. The program also recognizes technical challenges set out in the national technology strategy, oG21.

ProVisions For FUtUre weLL PLUGGinG, DismantLement anD remoVaL costs The change in provision in 2012 for future well plugging, dismantlement and removal costs has been calculated at nok 1 934 million using the unit-of-production method.

incurred costs in 2012 amounting to nok 874 million have been offset to previous year’s provisions.

FinanciaL income anD eXPenses 2012

2011

interest income from group companies

other interest income

Total financial income

(52)

(31)

(312)

(210)

(364)

(206)

Million nok

FinanciaL income

FinanciaL eXPenses

interest expenses to group companies other interest expenses Capitalized financial interest Total financial expenses

income taXes Taxes include both current and deferred taxes on income. The special petroleum tax has been calculated after the deduction of the available uplift allowance.

2012

2011

net income before taxes

32 838

35 971

Permanent differences*

(2 439)

(2 299)

933

(1 612)

31 332

32 060

Million nok

tHe Basis For tHe cUrrent taX ProVisions is caLcULateD as FoLLows:

Change in timing differences Basis for current tax calculation onshore income

(179)

Uplift

(2 611)

(2 295)

Basis for Special offshore Tax

28 804

29 586

8 773

8 977

14 402

14 793

(56)

1 367

Tax cost on interim result for Sale and Aquisitions of assets

114

–

Deferred tax

185

1 125

23 418

26 262

(11 067)

(8 664)

(103)

1 140

12 005

16 246

Corporate Tax 28% Special Revenue Tax 50% Previous years’ adjustment

This year’s tax cost instalments of income taxes paid other payable taxes related to previous years Total taxes payable in the balance sheet

income taXes (ConTinUED)

2012

2011

33 188

29 718

Pensions

(699)

(636)

other

1 391

3 091

(10 405)

(9 506)

Million nok

DeFerreD taX LiaBiLities are ProViDeD on aLL temPorarY DiFFerences Between tHe FinanciaL rePortinG Basis anD tHe taX Basis oF tHe comPanYs assets anD LiaBiLities :

Property, plant and equipment

Provision for well plugging and decommissioning Basis for deferred ordinary taxes

23 475

22 667

Deferred Uplift

(4 659)

(3 544)

onshore assets

(1 017)

(1 144)

Basis for deferred special taxes

17 799

17 979

DeFerreD taX:

Corporate Tax 28%

6 573

6 347

Special Revenue Tax 50%

8 900

8 991

Deferred tax liabilities**

15 473

15 337

Change in deferred tax**

185

1 125

income before taxes

32 838

35 971

Marginal tax rate 78%

25 614

28 057

taX ProoF:

Tax effect of: - Permanent and other differences* - Earned uplift - Previous years' adjustment This years tax cost

(454)

(2 032)

(1 930)

(1 352)

189

1 589

23 418

26 262

* Mainly related to the disposal of Tampen area in 2012 and Gassled in 2011. ** Discrepancies between income statement and balance sheet movements, is due to uplift transferred as part of an acquisition subject to PTA ยง10.

intanGiBLe assets, ProPertY, PLant anD eQUiPment

Million nok

ProD. inst. comPLeteD

transPort& otHer eQUiPments

BUiLDinGs

123 235

421

328

5 699

1 568

459

At cost 01.01.12 Addition Transfers

constrUction eXPLo weLLs Licence in ProGress in ProGress acQUisitions

totaL aLL assets

5 573

5 142

3 836

138 535

(4)

7 476

833

2 126

17 697

(633)

174

Retirements and sales

(6 562)

(22)

(6 584)

Accumulated investments at 31.12.12

122 831

1 988

324

12 416

6 126

5 963

149 649

Accumulated depreciation

83 184

396

101

3 168

3 150

89 998

Book value at 31.12.12

39 648

1 592

224

12 416

2 958

2 813

59 651

5 892

125

108

6 171

10-20 years

30-50 years

Evaluation

Decl / linear

Decl bal

2012 depreciation Estimated useful life of assets Depreciation plan

Unit-of-prod

Fixed assets include the following amounts for capital leasing agreements per 31 December 2012 and 2011: Million nok

Transport and other equipment Accumulated depreciation Book value year end

31.12.12

31.12.11

1 544

1 524

The financial leasing is reflecting a contract with a fixed capital cost for a period of 18 years. Total E&P norge AS has in addition the possibility to extend this agreement by 9 more years.

sHares reGistereD oFFice

ownersHiP interest

VotinG interest

eQUitY 31.12.2011

ProFit (Loss) 2011

Book VaLUe

ToTAl Etzel Gaslager GmbH

D端sseldorf

100.00%

11 053

(2)

8 736

ToTAl Gass Handel norge AS

Stavanger

100.00%

7 532

300

Sola

34.93%

72 300

40 800

All AMoUnTS in THoUSAnD nok

sHares in sUBsiDiaries anD associateD comPanies:

norpipe oil AS Total subsidiaries and associated companies

178 347 187 383

sHares in otHer comPanies:

kunnskapsparken nord AS other Total other companies

11.75%

9 252 5 9 257

Total E&P norge AS sold its shares in Gasnor in 2012.

transaction anD cUrrent BaLances witH GroUP comPanies Total E&P norge AS has different transactions with Group companies. All the transactions, are part of the normal business and with armâ&#x20AC;&#x2122;s-length prices. The major transactions in 2012 are: tYPe

Million nok

saLes

costs

GroUP comPanies

ToTAl S.A.

Services

Total international ltd

Sale of oil

Total Gas & Power ltd

Sale of gas

Total oil Trading SA

Sale of oil/lPG

Total E&P Uk

Sale of lPG

540 479 7 909 33 013 55

2012

2011

intercompany companies

2 985

2 793

Total

2 985

2 793

Million nok

receiVaBLes

PaYaBLes

overdraft facilities with associated finance companies

398

intercompany accounts payable

168

Total

168

438

Unused short-term overdraft facilities with an associated finance company were nok 1 000 million at year end 2012. interest rates are dependant on currency and based on interbank offered rates.

eQUitY

Million nok

Equity at 01.01.12

sHare caPitaL

sHare PremiUm

4 201

2 340

net income Dividend Equity at 31.12.12

4 201

2 340

At 31.12.12 Total E&P norge AS was a wholly owned subsidiary of Total Holdings Europe S.A., a company in the Total Group. The consolidated accounts of Total S.A. are available on www.ToTAl.com.

retaineD earninGs

totaL

157

6 698

9 421

(9 000)

578

7 119

LonG-term DeBt As of 31 December 2012, the Company had no unused long-term credit facilities. The lending interest on long-term loans from associated companies is based on market rate.

As of 31 December 2012 the long-term loans from other companies is linked to the booked financial leasing commitment.

Million nok

2–5 Years

5 Year +

196

1 268

long term debt related to leasing commitment

continGent LiaBiLities DismantLement continGencies. Under the terms of the oil and gas licences, the State may require full or partial dismantlement and removal of offshore oil and gas installations, or assume ownership at no charge when production finally ceases or upon the expiration of the licences, and also if the licence is surrendered or recalled. in the event of take over, the State will assume responsibility for dismantlement and removal of installations. if the Storting should require dismantlement and removal of the installations, removal costs will be fully tax deductible for the licensees.

The company has also entered into a lease contract for rental of a lnG carrier vessel (charter party) for the transportation of lnG production share of the Snøhvit fi eld. The commencement date of this contract is 2006 (ending 2018). As a partner in the fields under development and operation, the Company has leasing agreements for drilling rigs, helicopters, storage vessels and other vessels. leasing payments for Total E&P norge AS was in 2012 nok 1 386 million. Total future leasing costs for Total E&P norge AS are nok 14 426 million.

eQUiPment Leases. As operator, the Company have equipment lease rental obligations covering such operations as drilling rigs and other equipment. The duration periods of these lease agreements are from 1 to 2 years. The rental periods of offices and warehouse buildings have a duration of 3 to 11 years.

DriLLinG commitments. Under the terms of the licence agreements, the company is committed to participate in the drilling of 4 exploration wells, of which 2 as operator and 2 as licensee.

Million nok

1 Year

2–3 Years

4–5 Years

> 2018

leasing agreements

3 082

4 655

3 096

3 593

oiL anD Gas reserVes (not aUDiteD) The definitions used for proved, proved developed and proved undeveloped oil and gas reserves are in accordance with the United States Securities & Exchange Commission (SEC)’s final rule “Modernization of oil and Gas Reporting” issued on December 31, 2008. Proved reserves are estimated using geological and engineering data to determine with reasonable certainty whether the crude oil or natural gas in known reservoirs is recoverable under existing regulatory, economic and operating conditions. oil and gas reserves are assessed annually, taking into account, among other factors, levels of production, field reassessment, additional reserves from discoveries and acquisitions, disposal of reserves and other economic factors. This process involves making subjective judgments. Consequently, estimates of reserves are not exact measureRESERVES AT 31.12.2012

Proven, developed and undeveloped reserves

ments and are subject to revision under well-established control procedures. The estimation of reserves is an ongoing process which is done within Total E&P norge AS by experienced geoscientists, engineers and economists under the supervision of the Company’s General Management. Persons involved in reserve evaluation are trained to follow SEC-compliant internal guidelines and policies regarding criteria that must be met before reserves can be considered as proved. The estimation of proved reserves is controlled by the Group through established validation guidelines. For further description of the Group’s internal control process, please refer to the Reference Document issued by Total S.A. and available at www.total.com.

oiL, nGL anD conDensate (miLLion BBL)

natUraL Gas (BiLLion sm3)

oiL eQUiVaLents (miLLion BBL)

493

1 083

Licence PortFoLio at 31.12.2012

Licence

BLock

FieLD

own sHare

VaLiD to

Pl006

2/5

Tor

Pl018

2/4, 2/7, 7/11

Ekofisk area

Pl018B

1/6

Albuskjell

Pl024

25/1

Pl026

25/2

Pl029B

oPerator

100.00%

31.12.2028

39.90%

31.12.2028

ConocoPhillips

39.90%

31.12.2028

ConocoPhillips

Frigg

47.13%

23.05.2015

Total E&P norge AS

Rind

62.13%

23.05.2015

Total E&P norge AS

(15/6)

Dagny

30.00%

23.05.2015

Statoil Petroleum AS

Pl029C

(15/6)

Dagny

100.00%

31.12.2028

Total E&P norge AS

Pl034

30/05

Tune

10.00%

14.11.2015

Statoil Petroleum AS

Pl036

25/4

Vale

24.24%

11.06.2021

Statoil Petroleum AS

Pl036BS

25/4

Heimdal

16.76%

11.06.2021

Statoil Petroleum AS

Total E&P norge AS

Pl036D

25/4

Vilje

24.24%

11.06.2021

Statoil Petroleum AS

Pl040

29/9, 30/7

Martin linge

51.00%

31.12.2027

Total E&P norge AS

Pl043

29/6, 30/4

Martin linge

51.00%

31.12.2027

Total E&P norge AS

Pl043BS

29/6, 30/4 (islay Carve-out)

Martin linge

51.00%

31.12.2027

Total E&P norge AS

Pl043CS

29/6 (islay Carve-out)

islay

100.00%

31.12.2027

Total E&P norge AS

Pl043DS

29/6 (islay Carve-out)

islay

100.00%

31.12.2027

Total E&P norge AS

Pl044

1/9

Tommeliten

15.00%

31.12.2028

ConocoPhillips

Pl046

15/8, 15/9

Sleipner

10.00%

31.12.2028

Statoil Petroleum AS

Pl046B

15/9

Volve

10.00%

31.12.2028

Statoil Petroleum AS

Pl046C

15/9

"H" - discovery

10.00%

31.12.2028

Statoil Petroleum AS

Pl046D

15/9

10.00%

03.02.2013

Statoil Petroleum AS

Pl048

15/5

21.80%

31.12.2028

Statoil Petroleum AS

Dagny

Pl048B

15/5

Glitne

21.80%

15.07.2016

Statoil Petroleum AS

Pl048E

15/6

Eirin

21.80%

31.12.2028

Statoil Petroleum AS

Pl051

30/2, 30/3

Huldra

24.50%

06.04.2015

Statoil Petroleum AS

Pl052B

30/3

Huldra

18.00%

06.04.2015

Statoil Petroleum AS

Pl053

30/6

oseberg Øst

14.70%

01.03.2031

Statoil Petroleum AS

Pl054

31/2

Troll

3.69%

30-09.2030

Statoil Petroleum AS

Pl055C

31/4

oseberg Øst

14.70%

01-03.2031

Statoil Petroleum AS

Pl062

6507/11

Åsgard

24.50%

10.04.2027

Statoil Petroleum AS

Pl064

7120/08

Snøhvit

5.00%

01.10.2035

Statoil Petroleum AS

Pl072C

16/7

Beta & Theta nE

10.00%

31.12.2028

Statoil Petroleum AS

Pl073

6407/01

Tyrihans

29.14%

31.12.2029

Statoil Petroleum AS

Pl073B

6406/03

Tyrihans

26.67%

31.12.2029

Statoil Petroleum AS

Pl077

7120/7

Snøhvit

10.00%

01.10.2035

Statoil Petroleum AS

Pl078

7120/9

Snøhvit

25.00%

10.10.2035

Statoil Petroleum AS

Pl079

30/9

oseberg Sør

14.70%

01.03.2031

Statoil Petroleum AS

Pl085

31/3, 31/5, 31/6

Troll

3.69%

30.09.2030

Statoil Petroleum AS

Pl085B

31/9, 32/4

Troll

3.00%

08.07.2030

Statoil Petroleum AS

Pl085C

31/3, 31/6

Troll

3.69%

30.09.2030

Statoil Petroleum AS

Pl092

6407/6

Mikkel

7.65%

09.03.2020

Statoil Petroleum AS

Pl094

6506/12

Åsgard

9.80%

10.04.2027

Statoil Petroleum AS

Pl094B

6406/3

Åsgard

7.68%

10.04.2027

Statoil Petroleum AS

Pl099

7121/4

Snøhvit

37.50%

01.10.2035

Statoil Petroleum AS

Pl100

7121/7

Albatross

35.00%

01.10.2035

Statoil Petroleum AS

Licence PortFoLio at 31.12.2012

Licence

BLock

FieLD

own sHare

VaLiD to

Pl102

25/5

Pl102C

25/5

Pl102D

25/5

Pl102E

25/5

Pl104

30/9

oseberg Sør

Pl104B

30/9

oseberg Sør

oPerator

Skirne & Byggve

40.00%

01.03.2025

Total E&P norge AS

Atla

40.00%

01.03.2025

Total E&P norge AS

40.00%

03.02.2013

Total E&P norge AS

40.00%

03.02.2013

Total E&P norge AS

14.70%

01.03.2031

Statoil Petroleum AS

14.70%

03.02.2013

Statoil Petroleum AS

Pl110

7120/5, 7121/5

Snøhvit

25.00%

01.10.2035

Statoil Petroleum AS

Pl110B

7121/6, 8&9, 7122/5&6

Tornerose

18.40%

17.12.2014

Statoil Petroleum AS

Pl110C

7123/4

Snøhvit

18.40%

17.12.2014

Statoil Petroleum AS

Pl120

34/7, 34/8

Visund

11.00%

23.08.2023

Statoil Petroleum AS

11.00%

23.08.2034

Statoil Petroleum AS

7.65%

28.02.2022

Statoil Petroleum AS

Pl120 B

34/7, 34/8

Gimle

Pl121

6407/5

Mikkel

Pl127

6607/12

Alve north

50.00%

28.02.2023

Total E&P norge AS

Pl134

6506/11

Åsgard

10.00%

10.04.2027

Statoil Petroleum AS Statoil Petroleum AS

Pl134B

6506/11

kristin & Morvin

6.00%

10.04.2027

Pl134C

6506/11

Morvin

6.00%

10.04.2027

Statoil Petroleum AS

Pl146

2/4

king lear discovery

22.20%

08.07.2027

Statoil Petroleum AS

Pl171B

30/12

oseberg Sør

14.70%

01.03.2031

Statoil Petroleum AS

Pl190

30/8

Tune

10.00%

10.09.2032

Statoil Petroleum AS

Pl193

34/11

kvitebjørn

5.00%

10.09.2031

Statoil Petroleum AS

Pl193C

34/11

kvitebjørn

5.00%

10.09.2031

Statoil Petroleum AS

Pl193E

34/11

kvitebjørn

5.00%

03.02.2013

Statoil Petroleum AS

Pl199

6406/2

kristin

6.00%

10.09.2033

Statoil Petroleum AS

Pl211

6506/6, 6507/4

Victoria discovery

40.00%

02.02.2032

Total E&P norge AS

Pl211B

6506/9, 6507/7

Victoria ext.

40.00%

02.02.2032

Total E&P norge AS

Pl219

6710/06

15.00%

02.02.2014

Statoil Petroleum AS

Pl237

6407/03

Åsgard

7.68%

10.04.2027

Statoil Petroleum AS

Pl249

25/5

Vale

24.24%

11.06.2021

Centrica

Pl255

6406/5, 6406/6, 6406/9

linnorm discovery

20.00%

12.05.2038

Shell

Pl257

6406/1, 6406/5

6.00%

10.09.2033

Statoil Petroleum AS

Pl263C

6507/11

Pl275

2/4

Pl303B

15/6 2/4 7120/7, 7120/8, 7120/9 6506/9&12 7019/2,3,11 &12, 7120/10 7225/3, 7226/1 34/6 34/9 16/4 29/9, 30/7, 30/10 6406/7&8 1/2,3,5,6&9 1/3,6&9 25/5,6,8&9

Pl333 Pl448 Pl479 Pl488 Pl535 Pl554 Pl554B Pl569 Pl574 Pl585 Pl618 Pl619 Pl627

Yttergryta ext. Beta & Theta nE

24.50%

12.05.2037

Statoil Petroleum AS

39.90%

31.12.2028

ConocoPhillips

10.00%

12.02.2012

Statoil Petroleum AS

king lear discovery

22.20%

17.12.2013

Statoil Petroleum AS

Snøhvit

18.40%

15.06.2013

Statoil Petroleum AS

9.80%

01.03.2012

Statoil Petroleum AS

18.40%

01.03.2014

Statoil Petroleum AS

Smørbukk nord norvarg discovery

40.00%

15.05.2014

Total E&P norge AS

Garantiana discovery

40.00%

19.02.2015

Total E&P norge AS

Garantiana discovery

40.00%

19.02.2015

Total E&P norge AS

Theta nE

10.00%

04.02.2015

Statoil Petroleum AS Statoil Petroleum AS

40.00%

04.02.2018

100.00%

04.02.2018

Total E&P norge AS

60.00%

03.02.2019

Total E&P norge AS

50.00%

03.02.2020

Total E&P norge AS

40.00%

03.02.2019

Total E&P norge AS

aUDitor’s rePort

rePort on tHe FinanciaL statements

We have audited the accompanying financial statements of Total E&P Norge AS, which comprise the balance sheet as at 31 December 2012, the statements of income and cash flows for the year then ended and a summary of significant accounting policies and other explanatory information.

tHe BoarD oF Directors’ anD cHieF eXecUtiVe oFFicer’s resPonsiBiLitY For tHe FinanciaL statements. The Board of Directors and Chief Executive Officer are responsible for the preparation and fair presentation of these financial statements in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway, and for such internal control as the Board of Directors and Chief Executive Officer determine is necessary to enable the preparation of financial statements that are free fro material misstatement, whether due to fraud or error.

aUDitor’s resPonsiBiLitY. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with laws, regulation, and auditing standards and practices generally accepted in Norway, including International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

Design: Illustrations: VisCo CG / Total E&P Norge (page 4 and 6) and Headspin / Total E&P Norge (page 14). Paper: Arctic Volume High White (150/250g) Circulation: 400 (English) / 600 (Norwegian) Print: HBO AS

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, ass well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

oPinion. In our opinion, the financial statements of Total E&P Norge AS have been prepared in accordance with laws and regulations and present fairly, in all material respects, the financial position of the Company as of 31 December 2012 and its financial performance and its cash flows for the year then ended in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway. Report on other legal and regulatory requirements.

rePort on otHer LeGaL anD reGULatorY reQUirements

oPinion oF tHe BoarD oF Directors’ rePort. Based on our audit of the financial statements as described above, it is our opinion that the information presented in the Directors’ report concerning the financial statements, the going concern assumption and the proposal for the allocation of the result is consistent with the financial statements and complies with the law and regulations.

oPinion on reGistration anD DocUmentation. Based on our audit of the financial statements as descried above, and control procedures we have considered necessary in accordance with the international standard on assurance engagements (ISAE) 3000, “Assurance Engagements Other than Audits or Reviews of Historical Financial Information”, it is our opinion that the Board of Directors and Chief Executive Officer have fulfilled their duty to properly record and document the Company’s accounting information as required by law and generally accepted bookkeeping practice in Norway. Stavanger, 5 March 2013 ERNST & YOUNG AS Jostein Johannessen State Authorised Public Accountant (This translation from Norwegian has been made for information purposes only.)

oRgANIsATIoN

MANAgINg dIREcToR MARTIN TIFFEN

hsEq

ExTERNAl AFFAIRs

FINANcE/TAx/IT

huM. REs. & AdM.

lEgAl

NEw REsERvEs gRowTh

BjøRN oscAR TvETERås

BjøRN ARNE NæsgAARd

cAThERINE vAN dER lINdEN

sIgMuNd pETTERsEN

ARIld kvANvIk jøRgENsEN

jEAN-pAul ThIRIET

gEoscIENcEs

dEvElopMENT sTudIEs & plANNINg

hIld pRojEcT

opERATIoNs & pRojEcTs

coMMERcIAl

Bu gREATER EkoFIsk

Bu sTAToIl opERATEd

MARkETINg & TRANspoRTATIoN

dENIs FRANcoIs

pER gRINdE

FoudIl chEglIBI

ToRE Bø

jARlE MAdsEN

johN cATlow

RoAR ARBRIgTsEN

kRIsTIN skoFTElANd

ouR INTEREsTs oN ThE NoRwEgIAN coNTINENTAl shElF

total e&P norge ownershiP in Production fields and main oPerated Production licences on the ncs aT 01.05.2013

fields in Production

• • • • • • • • • • • • • • •

EKofiSK

norvarg (Pl535)

share (%)

oPerator

39.90

fields in Production

EldfiSK

39.90

CoNoCoPHilliPS

EMbla

39.90

CoNoCoPHilliPS

giMlE

4.90

STaToil

gliTNE

21.80

STaToil

gugNE

10.00

STaToil

HEiMdal

16.76

STaToil

Huldra iSlay

• • • •

CoNoCoPHilliPS

24.33

• • • • • • • • •

STaToil

100.00*

ToTal E&P NorgE

KriSTiN

6.00

STaToil

KViTEbJØrN

5.00

STaToil

MiKKEl

7.65

STaToil

MorViN

6.00

STaToil

oSEbErg

14.70

STaToil

oSEbErg EaST

14.70

STaToil

share (%)

oSEbErg SouTH

14.70

oPerator

barents sea

STaToil

SKirNE

40.00

ToTal E&P NorgE

SlEiPNEr EaST

10.00

STaToil

SlEiPNEr WEST/

9.41

STaToil

SNØHViT

18.40

STaToil

Tor

48.20

CoNoCoPHilliPS

alPHa NorTH

Troll

3.69

STaToil

TuNE

10.00

STaToil

TyriHaNS

23.18

STaToil

ValE

24.24

STaToil

VilJE

24.24

STaToil

ViSuNd

7.70

STaToil

ÅSgard

7.68

STaToil

snøhvit

hammerfest

tromsø

*norwegian share (5.51% of the total field)

harstad

ToTal E&P NorgE oPerated fields ToTal E&P NorgE oPerated licences ToTal E&P NorgE Partner oPerated fields

norwegian sea

alve nord (Pl127)

victoria (Pl211) morvin

åsgard

kristin tyrihans Pl585

mikkel

trondheim

visund

Pl685 Pl554 & 554b

gimle kvitebjørn martin linge*

huldra

islay tune

vale vilje

troll

oseberg

bergen oslo

atla

stavanger

sleiPner

oPerator

oil

skirne

glitne

share (%)

PiPelines

Pl627

heimdal

total e&P norge ownershiP (not shown on map)

NorPiPE (oil)

34.93000

CoNoCoPHilliPS

oSEbErg TraNSPorT (oTS)

12.98000

STaToil

froSTPiPE*

36.25000

Troll oil i

3.70687

Troll oil ii SlEiPNEr CoNdENSaTE

ToTal E&P NorgE STaToil

3.70687

STaToil

10.00000

STaToil

1.07910

STaToil

12.98000

STaToil

5.00000

STaToil

st. fergus north sea

aberdeen

Plants / terminals gas ETzEl gaS lagEr (ETzEl) oil

ekofisk

Pl618/619 Pl661/662

eldfisk embla

STurE (STurE) VESTProSESS (MoNgSTad) *frostpipe is no longer in operation, but is kept

*formerly hild

www.total.no

stavanger (main office)

osLo

Harstad

TOTAL E&P NORGE AS

Postal address P.O. Box 168 N-4001 Stavanger

Postal address P.O. Box 1361, Vika N-0113 Oslo

Postal address P.O. Box 63 N-9481 Harstad

Visiting address Finnestadveien 44, Dusavik N-4029 Stavanger

Visiting address Haakon VIIs gate 1 N-0161 Oslo

Visiting address Torvet 2 N-9405 Harstad

telephone +47 22 01 95 00

telephone +47 77 28 21 50

telephone +47 51 50 30 00