GDF SUEZ E&P Norge Annual Report by procontra

Annual report 2010 GDF SUEZ E&P Norge AS

contents

MISSION AND VISION

24 GJØA TRANSFER OF OPERATORSHIP

KEY FIGURES 2001–2010

26 SNØHVIT AND THE BARENTS SEA

HIGHLIGHTS 2010

28 THE NORWEGIAN SEA

MANAGING DIRECTOR’S STATEMENT

30 THE NORTH SEA

GJØA FEATURE

32 GREENLAND

12 GDF SUEZ E&P NORGE AS

34 HEALTH, SAFETY AND ENVIRONMENT

14 GDF SUEZ EXPLORATION AND PRODUCTION

36 COMMUNITY RELATIONS

16 GDF SUEZ GROUP

38 OUR TEAM

18 ACTIVITIES

45 DIRECTORS’ REPORT

20 GJØA DEVELOPMENT

50 ANNUAL ACCOUNTS

22 GJØA PRE-OPERATIONS

60 AUDITOR’S REPORT

GDF SUEZ E&P Norge AS will create value along the value chain by exploring for, developing, producing and transporting oil and gas on the Norwegian Continental Shelf. GDF SUEZ E&P Norge AS will do this in a sustainable manner and, through operational excellence, be respected by our stakeholders. It is the vision of GDF SUEZ E&P Norge AS to be an upstream company on the Norwegian Continental Shelf, among the top ten players, respected for its operational and HSE performance.

THE YEAR 2010

Key figures TURNOVER MILLION NOK

4,960 NET RESULT MILLION NOK

LAST TEN YEARS MILLION NOK

‘01

294

‘02

502

‘03

529

‘04

1,266

‘05

1,487

‘06

1,367

‘07

1,612

‘08

4,193

‘09

3,973

‘10

4,960

LAST TEN YEARS MILLION NOK

‘01

754 OIL AND GAS PRODUCTION MILLION BOE

13.7 Highlights

-34

‘02

‘03

‘04

264

‘05

366

‘06

467

‘07

508

‘08

1,268

‘09

623

‘10

754

LAST TEN YEARS MILLION BOE

‘01

1.2

‘02

2.6

‘03

2.7

‘04

4.8

‘05

4.0

‘06

3.3

‘07

4.2

‘08

10.8

‘09

11.3

‘10

13.7

Gjøa pre-operations 13 June the Gjøa platform was towed to field, and anchored up within a few days. The power cable from shore was hooked up and stable power supply from Mongstad established in July. Riser and umbilical pull-in was completed and pipelines and risers prepared for operation.

Gjøa transfer of operatorship Production on Gjøa started 7 November. Once all transfer of operatorship criteria were met, the official transfer of operatorship protocol was signed 25 November, by Statoil’s Øystein Michelsen, Executive Vice President Exploration & Production Norway and Terje Overvik, Managing Director of GDF SUEZ E&P Norge.

INVESTMENTS MILLION NOK

LAST TEN YEARS MILLION NOK

2,721 EXPLORATION COSTS MILLION NOK

EQUITY 31.12. MILLION NOK

969

‘03

1,327

‘04

1,992

‘05

1,712

‘06

2,310

‘07

2,844

‘08

3,864

‘09

4,580

‘10

2,721

‘01

‘02

‘03

‘04

‘05

126

‘06

204

‘07

335

‘08

528

‘09

654

‘10

494

LAST TEN YEARS MILLION NOK

2,328 Greenland

838

‘02

LAST TEN YEARS MILLION NOK

494

GDF SUEZ E&P Greenland AS was established as an affiliated company to GDF SUEZ E&P Norge AS in October. On 2 December 2010 GDF SUEZ E&P Greenland was awarded two large exploration licenses in the Baffin Bay offshore West Greenland, along with Shell Kanumas A/S (operator) and Statoil Greenland AS and NUNAOIL A/S.

‘01

Gudrun The Gudrun plan for development and operation (PDO) was approved by the Norwegian parliament in June. The development concept consists of a processing platform tied back to the Sleipner field by separate oil and gas pipelines. Drilling operations will start late 2011 and production start-up is expected in first quarter of 2014.

‘01

216

‘02

671

‘03

893

‘04

1,472

‘05

2,140

‘06

2,607

‘07

3,116

‘08

1,879

‘09

1,963

‘10

2,328

Brynhild drilling In the North Sea the company participated in the drilling of well 15/3-9 in PL187 Brynhild near the Gudrun field. Oil and gas was discovered. The Norwegian Petroleum Directorate estimate recoverable reserves to be between 0,5 and 3 million Sm3 oil equivalents. The discovery will probably be developed through a tie-in to the Gudrun field.

New licenses The company was awarded three new licenses in APA 2009. The awards include a 15% share in PL090E which is an extension to PL090 Fram in the North Sea; a 30% share and operatorship in PL423BS which is an extension to PL430 Gråtass and a 10% share in PL547S. In 2010 the company also acquired a 10% share in PL341 Stirby from Spring Energy and a 5% share in PL468 Dovregubben from Det norske. 5

Managing Director’s statement

Gjøa – a milestone in our history In 2010, GDF SUEZ E&P Norge AS became operator of the Gjøa field in the North Sea. This single event is the most important in our history. As a consequence we have become one of eight field operators on the Norwegian Continental Shelf, and with production from Gjøa we will be among the top ten oil and gas producers in Norway. The transfer of operatorship for Gjøa 25 November marked the end of Norway’s largest ongoing industrial project – but also a new beginning: The opening of a new area for oil and gas development in the northern North Sea. For several years we have been preparing to assume responsibility as operator and we will strive for the best HSE performance, secure and reliable production and we will continue towards long-term development of the Gjøa area. Gjøa: Operatorship was transferred from Statoil, responsible for the development phase, to GDF SUEZ E&P Norge AS on 25 November. Prior to this important milestone Gjøa had been in production since 7 November at 3:24 p.m. Gas export started the day after, on 8 November.

Through the years we have worked closely with the development operator, who has delivered a good project. Our organization has been closely involved in all phases and aspects of the project, and in parallel with this, we have been through intense preparations including competence training, the acquisition of systems and establishing of authentication procedures before takeover of operatorship.

From the start, Gjøa produces oil and gas from nearby fields Vega and Vega South. This illustrates how the Gjøa platform can act as a mother platform for the fields in the area around Gjøa. The platform is built with spare capacity for multiple connections, so that Gjøa can play a central role in the development of the surrounding area. This also represents a potential for our company, as a partner in several exploration licenses in the vicinity.

reservoir quality is poorer than expected. Due to the disappointing results the majority has decided to relinquish the license.

Gjøa’s operations concept is based on integrated operations, with access to common data in real time as a tool for better decision making. Daily there are joint meetings with staff and management in the operating organization at Forus, the Florø base and the platform on the field. The concept allows for common understanding of operational issues across geographical boundaries.

Ownership of the Gjøa oil pipeline was from 1 June transferred to Gassled, making the company a shareholder in Gassled and the extensive pipeline system on the Norwegian Continental Shelf.

Developments: For the Gudrun license, of which the company owns 25 percent, the plan for development and operation was approved by Parliament in June. Production start is scheduled for first quarter 2014.

Production: Production in 2010 was 13.7 million barrels of oil equivalent, representing a 21 percent increase compared with 2009. This is primarily due to improved regularity on Snøhvit and new production from Gjøa and Vega South in November and December. Fram and Njord are important assets in our portfolio, and contribute significantly to production. Exploration: During the year the company participated in the drilling of three exploration wells. In PL187 Brynhild oil and gas that constitutes possible additional reserves to the Gudrun field nearby was proven.

GDF SUEZ E&P Greenland AS has been established as a subsidiary of GDF SUEZ E&P Norge AS. Responsibility for implementation of the licenses that were granted by the Greenland authorities in December, is thus added to our organization in Norway.

The Njord partnership has decided to develop the Njord Northwest Flank with the drilling of two wells from the Njord platform. Drilling is expected to start in the first half of 2011 with production starting in the first quarter of 2013. The Gygrid oil field (now Hyme) has been listed by operator Statoil as a ”fast-track” project. The field will be tied to the Njord platform and production is expected from 2012. Financial results: 2010 was a good year with solid financial results.

The second North Sea well, PL341 Stirby, was dry. The third well was drilled in PL326 Gro in the Norwegian Sea, in order to appraise the discovery made in 2009. Gas was proven, but the

Terje Overvik Managing Director

”A Tale of an Ordinary Day” has been part of a project in the GDF SUEZ Group, where the message is conveyed through various channels of how the Group’s everyday activities affect society. About how sound operations at our workplaces help to meet the essential needs of a modern society. What to us may seem like a normal day at work is crucial for the overall functioning and safety of our operations.

Safe lifts are Robert Solås’ primary task.

Dagfinn Ommundsen and Ingunn Frette, Operations Technicians.

A tale of an ordinary day Crane operator Robert Solås gently lifts the chemical tanks from ”Siddis Supplier” on board the Gjøa platform. He calmly manoeuvres the 7-ton weight hanging from the 60 metre long crane boom so that the tank lands lightly on the platform deck. His goal: that this, just another gray day in March, will go down in history as a normal day at work, without any kind of incident, but with a safe and stable operation. There are many challenges in operating the crane, the movements between the supply vessel and the platform in 9 knots of wind, a swaying hook; Robert must be observant and ensure good communication between crane, deck and ship. Equipment, procedures, people – and a culture that promotes safety. That’s the way it must be – on every single usual or unusual day on the job. Everything is aimed at ensuring safe and efficient supply to a world thirsty for more energy produced in the most sustainable way.

John Winterstø, Offshore Installation Manager, in contact with colleagues in both Florø and Forus.

The chemical tanks from ”Siddis S upplier” are hooked up.

Offshore Installation Manager John Winterstø casts a contented glance at the production figures – the overview shows that they’ll soon have completed a month of almost 100% reliability. February was very good, almost astonishingly so. A well-designed platform filled with highly qualified people who follow rigorous procedures, together building a culture where safety and operational efficiency are paramount. The underground forces of nature, with oil and gas flowing from wells deep down below the seabed, must be tamed and controlled.

Management meeting and sacred 9 O’clock coffee At the morning management meeting, they go through today’s tasks; changing the filter on a sea water pump is discussed, and an oil gauge shows the wrong values – can it be fixed? Has the work permit form been filled out and signed? Maintenance tasks are ranked and prioritised, which jobs force out other ones, what is urgent – what can wait. And that pump – does it need to be overhauled onshore? During the night, a control system technician was called out to look at an oil export pump; how is that problem being followed up? They work calmly and efficiently through the matters at hand, explaining, clarifying, resolving. The onshore organisations at Forus and in Florø are connected to the screen, and together the colleagues discuss the tasks and challenges to guarantee Gjøa and the associated Vega field yet another day of safe production. Coffee at 9 am is sacred on board – this is a habit the offshore workers have inherited from sailors. This allows for professional and non-professional discussions

and chit-chat. There are 60 workers on the platform that day. A handful have just gone to bed – they work nights. Some have just arrived while others are looking forward to going home. Handover of information to new arrivals, exchange of the latest news – the chit-chat goes on, laughter rings out. The tasks are varied Ingunn Frette walks past the fire and blast wall that divides the platform in two; the process area on one side and the accommodation area on the other. She follows the yellow marked path to the flare stack and starts to climb. This job sends the operations technician to the highest point on the platform. Paul Kjønland and Steinar Rosenvold insulate the pipes of a pump. The

tasks are varied for an oil field worker. – We get to walk a lot, they say, it keeps off those extra pounds, even though we get plenty of good food. Annette Berg and Alf Worpvik prepare today’s meal of lightly salted cod or marinated chicken breast. And there’s a buffet with all kinds of meat and fish, cheeses and salads. Gone is the old myth about the offshore workers’ extravagant Christmas buffet every day of the year. Today’s cuisine is based on the H for Health in HSE – even when life is hectic and you have to cook for 100 men. The health of the catering staff must also be safeguarded with the help of a well-organised kitchen with good workflow. Provisions straight into the kitchen without

cumbersome transport and too much heavy lifting. The same thinking for cabins and common areas: Catering Assistant Anette Hillersøy gets the cabins ready for today’s new arrivals. Clear thinking in the design phase has resulted in an accommodation area with few dust traps and with rounded corners for easier cleaning. Hillersøy is on her first offshore job and makes much of the people, the environment and the workplace, also mentioning the fact that the offshore workers cooperate well in spite of having a number of different employers. HSE always comes first The helicopter lands. The passengers in their survival suits amble across the helideck to be welcomed by the offshore installation manager. In his safety

brief he emphasises that new arrivals have a special task: they can see everything with new eyes. So their observations are especially appreciated. New management meeting in the afternoon. HSE matters always come first; what happened about providing data sheets on the chemicals? Can we fix the chlorine pump that’s not working? The weather and sea conditions are discussed; how will that affect helicopter operations? Storing drinking water – an important task. Dinner, news on TV and newspapers. Lars Westbye arrives at the gym, walks for 5 minutes at 6 km/h and 7% inclination. Increases it to 14%. It’s important to get exercise when you have a sedentary job in the control room.

Insulator Steinar Rosenvold follows him with weight training, calling it ”preparation for the summer season”. – Besides, it gives me more energy for my job, he declares. Now and for the next 30 years The temperature drops towards zero in the March night. A sprinkling of snow. But production is going on as normal, observes Svein Arvid Nordahl on night shift in the control room. His colleague Kjersti Byrkjeland notes that the startup phase is well and truly over. The error messages have decreased. Now it’s a question of making optimum use of the installation; production is at maximum capacity in the export risers.

dehumidifiers and check the chemical cabinet before they take ”lunch” late in the evening, while their colleague Dagfinn Ommundsen from the day shift lies down in his bunk and reaches for a good book. In the far north of the North Sea night must follow day, now and for the next 30 years – with stable and safe operations as a guiding principle for Gjøa. To ensure European access to safe and reliable energy supplies, to safeguard welfare and revenue for society, the employees and the company.

Dagfinn Ommundsen rounds off the shift with a good book.

Svein Arvid Nordahl on the night shift in the control room.

Annette Berg and Alf Worpvik take good care of both the food and their colleagues.

– It’s important to exercise after a sedentary watch, says Lars Westbye.

The underground forces of nature, with oil and gas flowing from wells deep down below the seabed, must be tamed and controlled.

It was a perfectly ordinary day on Gjøa.

They have reversed day and night, they carry on talking about

GDF SUEZ E&P Norge

Our history in Norway LICENSE PORTFOLIO GROWTH GDF SUEZ E&P Norge AS

PL110B PL311B PL347 PL348 PL289 PL329 PL328 PL311 Area F PL187

PL110C PL394 PL376 PL090D PL110B PL311B PL347 PL348 PL289 PL329 PL328 PL311 Area F PL187

PL448 PL423S PL394 PL110C PL376 PL090D PL110B PL347 PL348 PL289 PL329 PL328 Area F PL187

Gjøa Fram Gudrun Snøhvit Njord Astero Vega South

2006

2007

Area F PL187 PL174 PL191 PL285

PL110B PL311B PL347 PL348 PL329 PL328 PL311 Area F PL187 PL285

Snøhvit Njord

Fram Gudrun Snøhvit Njord

Gjøa Fram Gudrun Snøhvit Njord

Gjøa Fram Gudrun Snøhvit Njord Astero Vega South

2001

2002

2003

2004

2005

PL187 PL174 PL191 PL285 PL006C

2001 The formal establishment of Gaz de France Norge AS, a wholly owned affiliate of GDF International S.A.S., was registered in April and, by June, the first four employees were located in the company’s offices in Stavanger. The final approbation of the acquisition from Statoil of interests in Snøhvit and Njord was completed in early July and the partners approved the plan for development and operation for Snøhvit in September. At the end of the year, an interest in PL006C (Tyr) was acquired from Enterprise, but after drilling a dry well, the company relinquished this license.

2002 In March, the Snøhvit project reached a milestone when the plan for development and operation was approved in Parliament. Through the sale of the State’s Direct Financial Interest (SDFI), Gaz de France Norge acquired a 15% interest in the Fram field in the northern North Sea, and through an acquisition from BP, a 12.5% interest in block 15/3 in the Gudrun area. In the 17th Licensing Round an award of a 30% interest was received in PL285 in the Norwegian Sea, but after a 3D seismic survey, the partners decided to relinquish the license in 2005.

2003 In a transaction with Norsk Hydro, Gaz de France Norge acquired a 30% interest in Gjøa, a discovery in the North Sea holding significant quantities of gas and oil. In parallel, the company engaged in the important process of being pre-qualified as operator on the NCS, and approbation was received from the Ministry in October. The Fram Vest field came into production, on schedule and below budget, on 2 October. An acquisition of Amerada Hess’ 15% interest in Area F in the Barents Sea was made at the end of the year.

2004 A historic milestone was reached when an agreement for joint operatorship on Gjøa was established with Statoil, approved by all partners and sanctioned by the authorities in February. Statoil became the operator for the development phase and GDF SUEZ E&P Norge will take over at start-up of the production phase. In the 18th Licensing Round we were awarded interests in PL328 and PL329 in the Norwegian Sea, and through the APA 2004 award later in the year we obtained other interests in the Norwegian Sea as well as the Barents Sea.

2005 The Plan for Development and Operation (PDO) for the Njord Gas Export project was approved by the authorities in January and the Fram East PDO was approved in April. The awards in APA 2005 of a 15% share in PL090D together with the other partners in Fram and 20% in PL376 further strengthened Gaz de France Norge’s presence in the prolific Fram area. The Astero discovery in Fram PL090B was the first discovery for Gaz de France in Norway and launched an extensive exploration drilling campaign in the area. 12

As one of the newcomers on the Norwegian Continental Shelf, GDF SUEZ E&P Norge has established a solid portfolio of exploration and production licenses in its ten year history. EXPLORATION LICENSES

PRODUCTION LICENSES SNØHVIT

PL153B PL448B PL469 PL488 PL448 PL423S PL394 PL110C PL376 PL090D PL110B PL348 PL289 PL329 PL328 PL230 PL187

PL377S PL326 PL530 PL107B PL107C PL153B PL448B PL469 PL488 PL448 PL423S PL394 PL110C PL376 PL090D PL110B PL348 PL289 PL328 PL230 PL187

PL468 PL341 PL547S PL423BS PL377S PL326 PL530 PL107B PL107C PL153B PL448B PL469 PL488 PL448 PL423S PL394 PL110C PL090D PL110B PL289 PL328 PL230 PL187

Gjøa Fram Gudrun Snøhvit Njord Astero Vega South

Gjøa Fram Gudrun Snøhvit Njord Astero Vega South Gygrid Noatun

2008

2009

2010

Njord

Gjøa

fram

gudrun

activities on the Norwegian continental shelf

2006 In the 19th Licensing Round, Gaz de France Norge was awarded interests in the Barents Sea; a 12% interest in PL110C with the other Snøhvit partners and a 20% interest in PL394 with Norsk Hydro, Statoil and Petoro. Throughout the year successful appraisal wells were drilled on Gudrun (North Sea), Tornerose (Barents Sea) and Astero (Fram Area). The first Fram East well was successfully brought on stream on 30 October. The plans for development and operation for Gjøa and Fram B were approved by the partners and submitted to the authorities for approval on 15 December.

2007 In June, the plan for development and operation for the Gjøa field was approved by Norwegian authorities. The Snøhvit project reached a major milestone in August, when the wells were opened and hydrocarbons were let into the LNG plant on Melkøya. In October, the first LNG cargo left the island. The Njord and Fram fields became gas producers, as start-up of gas export was initiated (in October for Fram and December for Njord). In APA 2006 Gaz de France Norge was awarded operatorship of PL423 S Gråtass. The company acquired 3D seismic for this license in the early autumn of 2007.

2008 Yearly production was doubled and reached an all time high of 10.8 million boe. Gjøa construction progressed with the topside at Stord and the hull in Korea. Our first own LNG cargo was lifted at Snøhvit on 5 March. In APA 2007, Gaz de France Norge was awarded four licenses, including operatorship on PL469 Pumbaa where a site survey was successfully completed in August. The Gudrun concept selection was made at the turn of the year. The merger led to a change of the company’s name, GDF SUEZ E&P Norge AS on 1 January 2009.

2009 The Gjøa platform reached 90% completion, following the transport of the hull from South Korea and the successful mating with the topside at Stord. The Gjøa development project progressed, reaching 73.3% completion at year end. In the 20th licensing round, GDF SUEZ E&P Norge was awarded operatorship and a 40% share in PL530 in the Barents Sea, and in APA 2008 a share of 20% in PL107B and PL107C. The authorities approved a transaction for the acquisition of 10% in PL326 Gro and for the acquisition of 20% in PL377S Prospect Apollon. The drilling of the first GDF SUEZ E&P Norge operated exploration well in PL469 Pumbaa was a company milestone.

2010 In June the Gjøa platform was towed to field, and production started in November. Transfer of operatorship from Statoil took place 25 November. The Vega fields started production in December. In October the company established a fully owned subsidiary, GDF SUEZ E&P Greenland AS, that was later awarded two licenses in Baffin Bay. Through APA 2009 GDF SUEZ E&P Norge was awarded a 15% share in PL090E, a 30% share and operatorship in PL423BS and a 10% share in PL547S. The company also acquired a 10% share in PL341 Stirby and a 5% share in PL468 Dovregubben. The company holds 25% in PL187 Brynhild, where the drilling of an exploration well in August resulted in a discovery. 13

GDF SUEZ Exploration and production

Looking to new regions 44

44 11

33 11

33 22

Reserves (proven + probable) Natural gas and oil. Geographical breakdown.

Production areas Natural gas and oil. Geographical breakdown.

TOTAL RESERVES 2010: 815 MILLION BOE. 1

NORWAY (39%)

NETHERLANDS (11%)

NORWAY (27%)

NETHERLANDS (34%)

GERMANY (16%)

OTHERS (21%)

GERMANY (19%)

OTHERS (3%)

UNITED KINGDOM (13%)

UNITED KINGDOM (17%)

Germany 33

The Group began its exploration and production activities in 1994 when it acquired Erdรถl-Erdgas Gommern GmbH (EEG). In 2003, it purchased onshore assets in Germany owned by Preussag Energie GmbH (PEG). In 2007, EEG merged with and 22 was absorbed by PEG. The entity resulting from the merger is now known as GDF SUEZ E&P Deutschland GmbH. Today, with almost 640 employees the Lingen based company generates about 17% of the German oil production and 12% of the national gas production. The total production was about 9.5 Mboe in 2010. GDF SUEZ E&P Deutschland GmbH has a holding in 76 onshore natural gas and oil fields in Germany out of which 44 are own operated. In addition the company holds several promising exploration licenses in the Upper 11 Rhine Valley.

TOTAL PRODUCTION 2010: 51.2 MILLION BOE.

United Kingdom

The11 Netherlands

Since 1998 the Group has participated in the Elgin-Franklin field in the UK Central North Sea. At the end of 2010 the Group had interests in 17 producing fields, with 6 near-term development projects. Of these, the GDF SUEZ operated 10 10 Cygnus field is one of the most significant gas 9 9 discoveries in the Southern North Sea in the last 30 years. The Group has a substantial portfolio 88 of exploration acreage and discoveries in the 77 and in the Southern and Central UK North Sea West of Shetland area. It was awarded 7 new 66 licences in 2010 as part of the 26th UK Licensing Round, including the significant 55 the Jacqui discovery. As of 31 December 2010, share of proven and probable reserves held by the Group in all UK fields represented around 44

GDF SUEZ E&P Nederland B.V. is part of the Group since 2000. It has a forty year history of successful exploration and production on the Dutch continental shelf. The company is a well 11 oil and established operator which produces gas from over 30 production facilities. It operates 39 producing fields and is the largest operator in the Dutch sector of the North Sea. As of 31 December 2010 the share of proven and probable reserves held by the Group represented 92.2 Mboe. GDF SUEZ operates two major Dutch offshore pipelines, 22 namely Noordgastransport B.V. and NOGAT B.V. The Noordgastransport pipeline runs roughly from west to east, coming to shore in Uithuizen. The NOGAT pipeline runs from north to south, 33 coming to shore in Den Helder, and is also connected to fields in Germany and Denmark.

100 Mboe. A further 50 Mboe of resources may, subject to meeting certain criteria, be matured into reserves in the future.

10 10

The Exploration-Production Division is responsible for all the Group’s exploration and production activities around the world. Its mission is: to grow to the size of a large independent E&P company through a medium-term value oriented growth

to develop profitable integration with the rest of the Group to build and run its business in a sustainable way in the long run

Snøhvit

indonesia

Njord Elgin Franklin

Gjøa Fram

Offshore Netherlands

GREENLAND

NORWAY

Nogat USA

Southern Gas Basin

NETHERLANDS

UNITED KINGDOM GERMANY

Pays du Saulnois

Altmark Offshore Germany Onshore Germany

australia

Römerberg

FRANCE

AzERBAijan

Absheron

algeriA South-East Ilizi

Touat

LIBYA

Onshore Libya

West el Burullus EGYPT

NW Damietta Ashrafi

Alam El Shawish West

Offshore Mauritania

Offshore Qatar qatar

MAURITANIA

IVORY COAST

Foxtrot

Egypt

Other regions

GDF SUEZ entered Egypt in 2005 with the award of the West El Burullus concession in the Nile River Delta. As operator with a 50% share, GDF SUEZ made two gas discoveries in 2010. The development of both discoveries is now envisaged. In 2007, the Group became an oil producer with a 45% share in the Alam El Shawish West concession. In 2010, GDF SUEZ participation was reduced to 25%. In July, gas production started and reached 100 mmscf/d by the end of the year. In 2008, the Group entered the exploration concession of North-West Damietta with a share of 10%. In 2010 the Group completed the acquisition from Eni of a 50% share in the oil producing field Ashrafi, located offshore in the Gulf of Suez. In order to further develop, a full-fledged affiliate was established in 2009. By the end of 2010, the Group’s reserves in Egypt stand at 20.4 Mboe, of which 66% is gas.

GDF SUEZ is also present in Algeria, the Ivory Coast, Mauritania, Libya, Azerbaijan, United States, Qatar, Australia, Indonesia, France and Greenland. Algeria: Since 2002 the Group has been the operator of the Touat permit in Algeria, in partnership with Sonatrach. The exploration/appraisal phase ended in 2007, and the development plan was approved in 2009. In 2010, the partners created TouatGaz, a joint venture for the development and operation of the license. The Group is also partner in an onshore license near the Libyan border (South-East Illizi). Mauritania: Through an agreement with Dana Petroleum in 2006, GDF SUEZ acquired interests in two offshore blocks off the coast of Mauritania: 24% in block 1, and 27.85% in block 7. An exploration well was drilled in September 2010 on block 7 and led to the Cormoran discovery. Ivory Coast: GDF SUEZ owns 100% of the company ENERCI. This company holds 12% of an offshore production major industrial player in the energy sector facility which supplies 60% of country’s needs. Libya: GDF SUEZ holds three onshore blocks. United States: GDF SUEZ holds two production licenses in the Gulf of Mexico. Azerbaijan: In 2009, GDF SUEZ acquired a 20% stake in the Absheron offshore block in the Caspian Sea.

Qatar: In 2009, GDF SUEZ acquired a 100% equity stake in Qatar’s offshore Block 4 through the purchase of Anadarko Qatar Block 4 Company, LLC, and the exit of Edison. The block contains several prospects. Australia: In 2009, GDF SUEZ acquired a 60% stake from Santos, in each of three offshore gas fields (Petrel, Tern and Frigate) located in the Bonaparte Basin in Australia, and will become operator in 2011. This project allows GDF SUEZ to develop an FPSO (Floating Production Storage and Offloading Unit) for LNG. The appraisal programme will start in 2011. Indonesia: In 2009, GDF SUEZ acquired a 45% stake from Eni in the offshore exploration Muara Bakau Production Sharing Contract (PSC). Two exploration wells were drilled in 2010 and the development plan is under evaluation. France: The Group holds a 50% stake in the Pays du Saulnois license in France. Greenland: GDF SUEZ obtained a 30% stake in two offshore exploration licenses in Blocks 5 and 8, located in Baffin Bay. And in Kazakhstan GDF SUEZ signed a Heads of Agreement in partnership with Total in 2009 to acquire half of the 50% stake of KazMunaïGas (KMG) in the offshore Khvalinskoye field, located near the border between Russia and Kazakhstan in the Caspian Sea.

GDF SUEZ Group

Worldwide presence 3 3

11 11

4 4

2 2

1 1

10 10

9 9 8 8 7 7 6 6

2 2 5 5 4 4

1 1

Natural gas sales By type of client

3 3

Natural gas portfolio Geographical breakdown of long-term contracts 10 10 TOTAL SUPPLY 2010: 691 Twh

TOTAL NATURAL GAS SALES 2010: 292 Twh 1

residential customers (48%)

NORWAY (21%)

trinidad (5%)

public distribution (33%)

RUSSIA (14%)

Yemen (3%)

contracts at market price (14%)

ALGERIA (13%)

OTHERS (3%)

subscription tariffs (5%)

NETHERLANDS (11%) 9 Libya (3%)

egypt (6%)

10 Unspecified origin (21%)

Activities

Development strategy

The Groupâ&#x20AC;&#x2122;s activities include:

GDF SUEZ operates a well-balanced business model: through its presence in complementary activities across the value chain through its presence in regions exposed to different business and economic cycles, with a strong presence in emerging markets with their greater prospects for growth through its presence allocated between activities that are exposed to market uncertainties and others that offer recurring revenue through a balanced energy mix with priority given to low- and zero-carbon energy sources.

marked by recent developments that will require an adaptation in the traditional model of the geocentric European utility: a cyclical downturn in prices in mature country energy markets following the 2008-2009 economic crisis a gap between expected growth in mature and emerging markets â&#x20AC;&#x201D; one that has widened and is expected to continue doing so adoption of the Climate Package in the European Union an increase in structural uncertainties weighing on European markets.

This business model responds to the demands of the economic environment in which the Group operates, characterized by the confirmation of underlying trends including stronger competition in Europe and the convergence of the markets for gas, electricity and energy services which, along with environmental services, combine many of the challenges of sustainable development. It is also

GDF SUEZ has thus based its development strategy on the following: acceleration of development in emerging markets in power generation and in the field of LNG and exploration and production integration and optimization of activities in Europe development of activities with recurring revenue Profile.

Purchasing, production and marketing of natural gas and electricity Transmission, storage, distribution, management and development of major natural gas infrastructures Energy services and services related to environmental management (water, waste).

The GDF SUEZ Group is active throughout the entire energy value chain, in electricity and natural gas, upstream to downstream.

EUROPE:

192,360 €69.9 EMPLOYEES

NORTH AMERICA:

6,070 €5.0 EMPLOYEES

BILLION 2010 REVENUES

ASIA & PACIFIC:

BILLION 2010 REVENUES

AFRICA:

SOUTH AMERICA:

4,300 €4.1 EMPLOYEES

4,050 €0.9 EMPLOYEES

10,970 €4.6 EMPLOYEES

BILLION 2010 REVENUES

Profile

Ranking

With more than 218,350 employees in some 45 countries, GDF SUEZ had revenue of €84.5 billion in 2010. GDF SUEZ presents a balanced profile – not only is it active in complementary businesses throughout the entire energy value chain, it also operates in regions subject to different economic cycles and market trends. The geographic and industrial complementarities of GDF SUEZ and International Power, which was integrated in 2010, afford GDF SUEZ, a leading position on the global energy landscape.

Listed in Brussels, Luxembourg and Paris, GDF SUEZ is represented in the major international indices: CAC 40, BEL 20, DJ Stoxx 50, DJ Euro Stoxx 50, Euronext 100, FTSE Eurotop 100, MSCI Europe and ASPI Eurozone. In 2010, GDF SUEZ was ranked the largest listed utility in the world in the annual classification of the 2,000 largest listed global companies published by Forbes magazine (24th in the general category, third among French companies). In a Group-wide participatory forum rolled out in 2009, the Group defined its fundamental values as drive, commitment, daring and cohesion.

A leader in natural gas in Europe: No. 1 purchaser No. 1 transmission and distribution network No. 3 in storage capacity World leader in LNG: No. 1 importer in Europe and No. 3 importer in the world No. 2 owner/operator of LNG terminals Leader in the Atlantic basin. Leader in electricity: The Group is the 5th largest producer and 6th largest marketer in Europe Top independent power producer (IPP) in the world The largest producer-developer in the GCC countries (Gulf Cooperation Council) The largest independent power producer in Brazil. World leader in services: For energy and environmental efficiency. 17

Activities Focus areas Field development and operations Gjøa

Exploration and development Snøhvit/Barents Sea

The Gjøa field is GDF SUEZ E&P Norge’s first production operatorship on the Norwegian Continental Shelf and is expected to produce hydrocarbons for more than 15 years. Statoil was operator in the development phase while GDF SUEZ E&P Norge took over the operator-ship at production start-up in November 2010.

Snøhvit is the first LNG development project on the Norwegian Continental Shelf, with an expected yearly production of 4.3 million tons of LNG.

Gjøa is GDF SUEZ E&P Norge’s first major commitment towards its ambition to become a significant player on the Norwegian Continental Shelf. Gjøa enables GDF SUEZ E&P Norge to build field development and operation competence, and prepare the organisation for future operatorships.

The facilities for gas receiving and handling, conversion into LNG for storage and loading onto LNG tankers are located on the island of Melkøya.

Based solely on subsea installations, the Snøhvit field is situated approximately 140 km from the shore.

The very first GDF SUEZ LNG cargo was lifted on 5 March 2008. This delivery marked the opening of a new LNG supply route capable of providing 700 million m3 of gas in a full year. GDF SUEZ E&P Norge has dedicated resources for exploration to prove additional reserves which could justify a second phase of the Snøhvit LNG development.

GJØA FIELD DEVELOPMENT AND OPERATIONS

Snøhvit AND Barents SEA

Exploration and development Norwegian Sea

Exploration and development Fram/Gjøa area

Exploration Greenland

The Norwegian Sea potentially holds large volumes of yet undiscovered resources.

The Fram / Gjøa area is proven as a prolific area of the North Sea and may still contain significant discoveries.

In partnership with other operators, GDF SUEZ E&P Norge is undertaking an extensive exploration programme in the area.

GDF SUEZ E&P Norge has acquired additional exploration acreage in the Fram / Gjøa area.

GDF SUEZ E&P Greenland AS was established as an affiliated company to GDF SUEZ E&P Norge AS in October 2010. On 2 December 2010 GDF SUEZ E&P Greenland AS, Shell Kanumas A/S (operator), Statoil Greenland AS and NUNAOIL A/S were awarded two large exploration licenses in the Baffin Bay offshore West Greenland. Both licenses have been granted for a period of up to 10 years. During this period seismic investigations and subsurface evaluations will take place along with potential exploration drilling.

The Njord field, in the Norwegian Sea, is already a key contributor to GDF SUEZ E&P Norge’s total production of oil. Gas export from the field started in December 2007. New discoveries close to the Njord field may generate new development options with benefits also to the lifetime of the Njord field and facilities.

NORWEGIAN SEA

Through these commitments GDF SUEZ E&P Norge has established a strong position which we will build on in our efforts to explore new opportunities in the area. Gjøa, as a new processing and transportation hub in the area, offers additional capacity for tie-ins of new and existing discoveries.

NORTH SEA

The award of the Baffin Bay licenses represents a significant expansion of GDF SUEZ’s acreage in the highly prospective Arctic region.

GREENLAND

Gjøa development

During the development phase Gjøa was the largest current industrial project in Norway.

Project development – with clear targets For the development phase of the Gjøa project, operator Statoil and the license partners established a clear focus on safety, where “no fatalities, accidents, losses or harm to people” was a stated goal. The drilling rig, Transocean Searcher, was engaged for the drilling of 11 production wells. Five of these wells were completed when production commenced. The drilling program will continue until 2012.

The Statoil-operated gas/condensate fields Vega and Vega South have been developed in parallel with Gjøa as a tie-back to the Gjøa platform. The Vega fields started production 2 December 2010.

Development concept – value creation The selected development concept and production strategy will maximize the value of the Gjøa resources whilst minimizing risk exposure. The development concept for the Gjøa field includes three 4x4 slot

subsea templates and one satellite well tied back with flow lines to a semi-submersible production unit with full processing capabilities. The export of stabi lized oil takes place through a new 53 km pipeline tied in to the pipeline running from the Troll C platform to the Mongstad crude oil terminal (the TOR2 pipeline system). Export of rich gas takes place through a new 130 km pipeline tied in to Britain’s FLAGS pipeline system, ending up at the St. Fergus gas terminal in Scotland. GDF SUEZ’s equity gas is sold at the landing point in the UK.

Electricity for the field installations is provided from a land-based power supply connection at Mongstad. For the first time in the world, alternating current is supplied directly to a floating production facility. This solution leads to a considerable reduction in CO2 and NOx emission levels, lower costs, improved economy, reduced noise level, and reduced fuel consumption.

1989

2003

30%

2004

Discovery by Norsk Hydro

GDF SUEZ E&P Norge acquires an interest in the field

interest owned by GDF SUEZ E&P Norge

Joint operatorship agreement with Statoil signed

gjøa Vega

Florø Florø

Vega south

Gjøa

Florø

LOCATION Located in blocks 35/9 and 36/7, Gjøa lies about 70 kilometres north of Troll and 60 kilometres off the Norwegian west coast.

Area solution – a new hub in the North Sea The Gjøa development has opened a new area for oil and gas production in the North Sea. The coordinated development of the Vega and Gjøa fields provides mutual benefits for the partnerships, in addition to satisfying a requirement from the authorities to optimize the total area output. As a central hub, the Gjøa production facility will offer spare liquid capacity when Gjøa oil production is declining and spare gas capacity when Vega goes off plateau.

The presence of infrastructure combined with spare processing capacity will support further exploration and development in the area. Although Gjøa is expected to produce oil and gas for the next 15 years, the platform has been designed to last twice that time.

Gjøa pre-operations

7 November everything was ready for production start-up on Gjøa.

Transition into operations For GDF SUEZ the great transition in 2010 was going from working with pre-operation tasks to operating Gjøa in a safe and efficient way. The living quarters were ready for use in March, and from that point GDF SUEZ got the daily opera tional responsibility of systems and areas handed over from Statoil’s completion team. Operation technicians started to work on a shift rotation and our employees completed education and courses according to

competence requirements needed to operate and maintain the process and utility systems. 13 June the Gjøa installation was towed out to the Gjøa field, and anchored up after a few days. The power cable from shore was hooked up and stable power supply from Mongstad established in July. Then riser and umbilical pull-in was completed and pipelines and risers were prepared for operations. The GDF SUEZ E&P Norge work permit and safe job analysis system in the CMMS maintenance management

system was successfully taken into use when mooring was completed. The planning tool (IPL) was installed, tested and put in operation in order to manage good activity coordination and resource allocation. Maintenance, service and supplier agreements were established to secure services and parts to maintain a safe, effective and stable operation after transfer of operatorship.

Start-up The complex process of initial start-up of an offshore facility

involves check lists, equipment, work permits, safe job analysis, sufficient and competent personnel, check by check to ensure that all safety systems are in place and working. All instructions and check lists were collected in a start-up handbook that was prepared by Operations. To secure a common under standing by all stakeholders in due time prior to start-up the handbook and method was presented in two start-up seminars. 7 November we were ready for start-up. All necessary certificates,

2010

Start-up of production

billion NOK estimated total investment in the field

billion Sm3 of gas are estimated reserves

million barrels of oil and condensate are estimated reserves

checklists and records both on and offshore were signed. Required utility systems on GjĂ¸a were in operation and the control room manned for start-up. Out in the plant, extra personnel was located to detect possible gas leaks or other Âirregularities that may occur when a facility reaches normal operation conditions for the first time. At 3:30 PM the good news came that gas was flowing from well F-1 into the separators. The other available wells were put on stream one by one without any leaks or other serious incidents.

Gjøa transfer of operatorship

The Gjøa transfer of operatorship from Statoil to GDF SUEZ E&P Norge took place 25 November 2010.

Transfer procedure In accordance with a 2004 agreement to split the Gjøa operatorship into two phases, GDF SUEZ E&P Norge AS took over operating responsibilities for this North Sea field from Statoil 25 November. As such, GDF SUEZ has become a member of the top oil and gas producers on the Norwegian continental shelf. To ensure that all aspects concerning the transfer from project execution including production operation were managed in an orderly and transparent manner a joint Statoil/GDF SUEZ

Transfer Coordination Team was established in 2008. The main tasks of this team were to establish and implement a transfer strategy and plan that would lead to the signed protocol as the final deliverable. Subgroups were established within key areas with a nominated lead person from Statoil and a counterpart from GDF SUEZ E&P Norge. During the final stages of this transfer process, these activities were organized as a separate project with a dedicated GDF SUEZ project manager.

All of the criteria required for transfer of operatorship have been met. The platform was installed, it reached a stable and continuous production, GDF SUEZ completed its administrative and organizational preparations and all the transfer of operatorship subject matter groups have concluded their work. GDF SUEZ E&P Norge is now responsible for all activities at Gjøa, including drilling and well completion, reservoir and production performance, emergency pre paredness and joint venture management. GDF SUEZ will lead the asset management

team and chair the Gjøa license management committee. Statoil will continue to assist with operational activities and completion of the drilling program.

Excellent cooperation The cooperation between Statoil and GDF SUEZ has been excellent during the project execution phase, allowing GDF SUEZ personnel to be integrated in the Statoil project organization from the beginning. The Gjøa platform was staffed with GDF SUEZ personnel from the first day, working under Statoil manage ment. In this way, the actual

2010

630

Transfer of operatorship from Statoil

November, signing of transfer protocol

systems approved and handed over from Statoil

million work hours completed in the project

5 4

Partners in the gjøa license 1 2 3 4 5

GDF SUEZ E&P NORGE (30%) petoro (30%) statoil (20%) shell (12%) rwe-DEA (8%)

transfer of operatorship took place without any o perational interruptions. The official transfer of operatorship took place in Stavanger 25 November, when the transfer of operatorship protocol was signed by Statoil’s Øystein Michelsen, Executive Vice President Exploration & Production Norway and Terje Overvik, Managing Director of GDF SUEZ E&P Norge. Present were also Helge Lund, Chief Executive Officer, Statoil and Jean-François Cirelli, Vice Chairman and President of GDF SUEZ. 25

Snøhvit and the Barents Sea

As operator of PL530 GDF SUEZ E&P Norge has started planning a well on the Heilo prospect.

Snøhvit The Snøhvit LNG plant continued to improve performance during 2010. No major revision stop was planned in 2010, but minor stops were carried out for inspection and installation of a leak handling system. In addition Snøhvit experienced some unplanned shutdowns due to various operational incidents. Snøhvit is a key asset within GDF SUEZ E&P Norge’s portfolio and one of its five producing assets. Snøhvit contributed a total production of 4.9 million barrels of oil equivalents in 2010, 26

r epresenting 36% of the affiliate’s total production.

a concept selection milestone (DG2) in second quarter of 2012.

GDF SUEZ lifted a total of seven LNG cargoes from the Snøhvit plant in 2010.

Barents Sea Exploration The Barents Sea remains one of the core areas for GDF SUEZ E&P Norge. In 2010, GDF SUEZ E&P Norge as operator of PL530 started planning a well on the Heilo prospect. PL530 is located between the Tornerose discovery to the west and the Nucula discovery to the east, approximately 50 km north of the Norwegian coastline.

Snøhvit offshore facilities Field performance is according to plan. Albatross started production in January 2010 and contributed approximately 14% of the total feed gas to the plant. Snøhvit Train II Snøhvit Train II passed the feasibility milestone (DG1) in December 2010. The plan is now to continue studies up to

Partners in PL530 are Front Exploration, North Energy and Rocksource.

Alongside DONG Energy, GDF SUEZ E&P Norge headed a consortium that has requisitioned the semi-submersible rig Aker Barents for the drilling of two wells in the Barents Sea, including Heilo, scheduled for third and fourth quarter 2011. A large 3D seismic survey (1150 km2) was acquired in the Southern Nordkapp Basin in PL230 where GDF SUEZ E&P Norge has a 15% equity. The data are currently being processed. In PL448 where GDF SUEZ E&P Norge has a 12% equity a decision t o drill one exploration well was made.

1984

2001

12%

4.1

The Snøhvit field discovered through well 7121/4-1

GDF SUEZ E&P Norge joins the project

interest held by GDF SUEZ

million tonnes LNG will be produced yearly

6 snøhvit

partners in the snøhvit unit 1 2 3 4 5 6

GDF SUEZ E&P NORGE (12%) statoil (33.53%) petoro (30%) total (18.4%) amerada hess (3.26%) RWE-DEA (2.81%)

LOCATION The Snøhvit field is located approximately 140 km from the island of Melkøya, Hammerfest.

The Norwegian Sea

The Njord North West Flank has been sanctioned, and production start-up is expected in 2012.

Njord The Njord field is located in blocks 6407/7 and 6407/10, around 130 km northwest of Kristiansund and 30 km west of the Draugen field. The field has been developed with subsea wells tied back to the Njord A facility. The oil is stored and offloaded from the Njord B vessel, to tankers for transport to the market. Njord is a key asset within GDF SUEZ E&P Norge’s portfolio and one of its five producing assets. Njord contributed a total oil production of 4.4 million barrels of oil equivalents in 2010, representing 32% of the affiliate’s total production. 28

The successful drilling results with well A-19 late December 2009, continued in 2010 with two more infill wells; A-5 in March and A-8 in December both with significant contributions to the field production. The infill drilling continues on Njord and well targets have been identified to support drilling through 2012.

North West Flank The North West Flank (NWF) originally comprised a gas/ condensate discovery in the B-structure, some 6 km northwest of Njord. In 2007, a well was drilled with both an exploration target in the neighbouring A-structure, and an appraisal

target in the B-structure. The exploration well was a success, and the A-structure was confirmed as a discovery with similar resource potential to the B-structure, but with much better reservoir quality. In March 2010 the NWF was sanctioned, and the plan is to develop the A-structure by two long reach wells drilled from the Njord platform. Only minor modifications are needed on Njord. Production start-up is expected in April 2012.

Norwegian Sea exploration GDF SUEZ E&P Norge holds a 10% equity in PL326 where the

6604/10-1 appraisal well was drilled on the Gro structure, 12 km east of the discovery well 6603/12-1. This deep-water well (1376 m water column) encountered gas in Upper Cretaceous rocks of poor reservoir quality. In addition new 3D seismic was acquired over the license area and will be merged with existing seismic surveys to map the extent of the Gro discovery as well as the remaining prospectivity. In 2010 GDF SUEZ acquired a 5% equity in PL468. The area of the license was extended through the APA 2010 awards as PL468B. The license contains

1997

2001

20%

2007

Production start-up on Njord

GDF SUEZ E&P Norge acquires an interest in the Njord field

interest held by GDF SUEZ E&P Norge in the Njord field

Start-up of the Njord Gas Export Project

njord

Partners in the njord unit 1 2 3 4 5 6

GDF SUEZ E&P NORGE (20%) E.ON RuHrgas (30%) statoil (20%) exxonmobil (20%) petoro (7.5%) endeavour (2.5%)

LOCATION The Njord field is located 130 km north-west of Kristiansund and 30 kilometres west of Draugen.

the Dovregubben prospect, and a well on the prospect spudded 26 December 2010. In January 2011 GDF SUEZ E&P Norge was awarded three new licenses in the Norwegian Sea through APA 2010: PL348B was awarded as additional acreage to PL348 with a 20% equity and partner role. PL468B was awarded as additional acreage to PL468 with a 5% equity and a partner role. GDF SUEZ E&P Norge was awarded a 30% share in PL582. The work program will be to merge and reprocess 3D seismic data, and perform studies before a drill or drop decision within two years. 29

The North Sea

The Gudrun plan for development and operation was approved in June.

Gudrun Located some 55 kilometres north of Sleipner and in water depth around 110 metres, the Gudrun field was discovered in 1975. The field contains both oil and gas in a reservoir of complex geology and high pressure and temperature (HPHT). The Gudrun plan for development and operation (PDO) was approved by the Norwegian parliament in June. The development concept consists of a processing platform tied back to the Sleipner field by separate oil and gas pipelines. Oil and condensate from Gudrun will be mixed with Sleipner 30

liquids and transported to the Kårstø processing plant. The gas will be mixed with Sleipner gas and transported to the continent. Drilling operations will start late 2011 and production start-up is expected in first quarter of 2014. An exploration well was drilled in summer 2010 into the Brynhild prospect east of Gudrun. The well was a discovery and work is now ongoing to see if Brynhild can be developed from the Gudrun platform.

Fram Production from the Fram field contributed a total of 3.58 barrels of oil equivalents in 2010, representing 27% of the affiliate’s total production. Our average daily oil production from this asset was 9,800 barrels per day – a consistent production performance above budget. Vega South Vega South is located some 10 km north-northwest of the Fram field, in block 35/11, and has been developed together with the Vega field. The two fields constitute three subsea tem plates, with two production wells

in each, tied back to the Gjøa platform. The Vega fields started production 2 December 2010.

North Sea exploration The Gjøa-Fram and Gudrun areas remain core areas for GDF SUEZ E&P Norge, and exploration to expand our portfolio in these areas has continued. In March 2010, we were awarded a 15% equity as partner in PL090E, 30% equity and operatorship in PL423BS and 10% as partner in PL547S through APA 2009. In January 2011 GDF SUEZ E&P Norge was awarded two new

2002

2003

15%

3.58

GDF SUEZ E&P Norge aquires interest in the Fram field

Production start-up on Fram Vest

interest held by GDF SUEZ E&P Norge in the Fram field

million boe equity production on Fram in 2009

4 1 3

gjĂ¸a fram

gudrun

partners in the fram license 1 2 3 4

GDF SUEZ E&P NORGE (15%) statoil (45%) exxonmobil (25%) idemitsu (15%)

licenses, a 20% equity in PL377BS as additional acreage to PL377S and 30% equity in PL578 in block 35/6 north of the GjĂ¸a field through APA 2010. GDF SUEZ E&P Norge holds a 25% equity in PL187 in the Gudrun area where the Brynhild well 15/3-9 was spudded in May and finalised in August 2010 as a discovery.

LOCATION The Fram field is located 20 kilometres north of Troll. Gudrun is situated about 40 kilometres north of the Sleipner area.

Technical work continued in the GDF SUEZ operated license PL423S/BS, where our equity is 30%. A 1 year extension of the drill or drop decision deadline has been granted with a new deadline of 16.08.2011. GDF SUEZ E&P Norge holds 20% equity in PL377S where the Apollon prospect will be drilled in Q2-Q3 2011.

Through a farm-in opportunity GDF SUEZ E&P Norge acquired a share in PL341 in 2009. The Stirby prospect located in the license was drilled in 2010, but the well was dry. 31

Greenland

GDF SUEZ E&P Greenland is an affiliate of GDF SUEZ E&P Norge.

License awards GDF SUEZ E&P Greenland AS was established as an affiliated company to GDF SUEZ E&P Norge AS in October 2010. On 2 December 2010 GDF SUEZ E&P Greenland AS, Shell Kanumas A/S (operator), Statoil Greenland AS and NUNAOIL A/S were awarded two large exploration licenses in the Baffin Bay offshore West Greenland. The two frontier licenses named 2011/12 (block 5) and 2011/14 (block 8) are located north of 730N and cover a total area of approximately 20,000 km2 corresponding to a total of approximately

30 Norwegian blocks. Both licenses have been granted for a period of up to 10 years. During this period seismic investigations and subsurface evaluations will take place along with potential exploration drilling in 2015.

Prospective region The award of the Baffin Bay licenses offshore West Greenland represents a significant expansion of GDF SUEZ’ acreage in the highly prospective Arctic region. Experts from the U.S. Geological Survey believe that the Arctic contains

approximately 22% of the world’s undiscovered hydro carbon reserves of which 74% may be gas, which makes this area attractive to GDF SUEZ as one of the leaders within natural gas and LNG in the world. Estimates suggest that reserves for the offshore West Greenland – East Canada area could total as much as 18 billion barrels of oil equivalent. Due to relatively sparse data coverage over the licenses there are many uncertainties related to the probability of discovery but the potential reward if one or more sizable

discoveries are made could be high.

Partnerships The partnerships in the Greenland licenses are as follows: Block 5 (Anu): Shell Kanumas A/S (41.125%), Statoil Greenland AS (20.125%), GDF SUEZ E&P Greenland AS (26.25%), and Nunaoil A/S (12.5%) Block 8 (Napu): Shell Kanumas A/S (46.375%), Statoil Greenland AS (14.875%), GDF SUEZ E&P Greenland AS (26.25%), and Nunaoil A/S (12.5%)

2010

26.25% 2015

GDF SUEZ E&P Greenland established

2 licenses awarded to GDF SUEZ E&P Greenland AS

interest held by GDF SUEZ E&P Greenland AS

Potential start of exploration drilling

2 2

license partners block 5 ANU 1 2 3 4

GDF SUEZ E&P greenland AS (26.25%) statoil greenland AS (20.125%) shell kanumas A/S (41.125%) nunaoil A/S (12.5%)

Anu Napu Upernavik

3 3

1 2

9 8 7

2 5

license partners block 8 napu 1

1 2 3 4

GDF SUEZ E&P greenland AS (26.25%) statoil greenland AS (14.875%) shell kanumas A/S (46.375%) nunaoil A/S (12.5%)

9 8 7 6

2 5 4

Health, safety and environment

HSE objectives The strategic objective of GDF SUEZ E&P Norge related to HSE is to achieve top quartile HSE performance in all companyoperated activities on the Norwegian Continental Shelf, measured against the results in the RNNP report (Trends in Risk Levels – Norwegian Continental Shelf) published by the Petroleum Safety Authority Norway each year. Our strategic objective

HSE at GDF SUEZ E&P Norge supports our HSE policy and our ambition to have zero incidents. The HSE policy applies to all affiliates of the GDF SUEZ Exploration & Production business unit, confirming that Health, Environment and Safety is a core value beneficial to all GDF SUEZ E&P activities.

GDF SUEZ E&P Norge assumed operatorship for Gjøa in November 2010 from Statoil. For this reason, GDF SUEZ used the whole of 2010 to prepare for this important task, including development and implementation of necessary processes, methodologies and systems within health and working environment, safety and environment.

One important task has been to establish a fully-trained and well prepared emergency management organisation. Operatørenes forening for beredskap (OFFB) is a non-profit member association with eight operators on the Norwegian Continental Shelf as its members. OFFB provides 2nd line emergency organisation as

an integrated part of our total emergency management organisation. GDF SUEZ joined OFFB in 2010, and holds one of the chairs in the OFFB board. Gjøa being the oil field closest to shore on the Norwegian Continental Shelf, located only 30 nautical miles from shore, focus on oil spill preparedness is considerable. To verify the oil spill

preparedness for Gjøa, a two day full scale oil spill exercise was organised in Florø late September. The coast alongside Gjøa has the highest concentration of oil spill equipment in the world, in addition to a well functioning collaboration on oil spill preparedness. The Gjøa installation is developed to cause as little environmental impact as possible with, among

other things, electricity from shore as the main power source. All discharges in 2010 were within the given permits from the Climate and Pollution Agency. GDF SUEZ emphasizes the use of environmentally friendly chemicals. During 2010, three incidents involving personnel were recorded.

The incidents were: • Fractured ankle, as a result of slipping on icy walkway. • Injured toe, as a result of squeeze in electric door. • Injury to hand as a result of handling ammunition for flare.

Community relations

Policy

ONS 2010

Sponsorship

ICMF

GDF SUEZ E&P Norge’s goal is to maintain close dialogue with society in general and our stakeholders in particular, in order to be able to act on their requirements and to build an understanding of and interest for our activities.

GDF SUEZ E&P Norge was present at the Offshore Northern Seas (ONS) exhibition 2010. His Majesty King Harald visited the stand and was greeted by Jean Marie Dauger, Executive Vice President of GDF SUEZ and Chairman of the GDF SUEZ E&P Norge board, along with Managing Director Terje Overvik. Industrial stakeholders, norwegian cabinet ministers, parliamentarians and politicians from all over the country were given presentations on our activities in general, and Gjøa in particular.

GDF SUEZ E&P Norge has drawn up its sponsoring policy in line with that of the GDF SUEZ Group, focusing on projects within nature, culture and sports. Primarily we support projects in regions where the company is active, namely Rogaland, Finnmark and Sogn og Fjordane.

GDF SUEZ E&P Norge has been one of the main sponsors of the International Chamber Music Festival (ICMF) since 2003. In 2009, GDF SUEZ E&P Norge signed a new three-year agree ment with ICMF. The festival takes place in early August every year in the Stavanger region. The program consists of Norwegian and international artists and is developed by the festival’s artistic leaders. The 2010 festival was the first to be led by Martin Fröst and Christian Ihle Hadland.

Den Norske Turistforening

Florø 150

FTIF

First established in 2003, our cooperation with Den Norske Turistforening (DNT/The Norwegian Trekking Association) continued in 2010. DNT’s main objective is to inspire as many as possible to enjoy the great outdoors, making sure that all activities are carried out in an environmentally friendly manner.

In 2010 the town of Florø celebrated its 150th anniversary with a number of social, cultural and sports events for young and old. GDF SUEZ E&P Norge was a main sponsor of the celebration. In addition, a free Åge Aleksandersen concert was given to the people of Florø, and five scholarships for young local talents were announced.

In 2008, GDF SUEZ E&P Norge established a sponsorship agreement with Florø Turn & Idrettsforening (FTIF), the athletics club in Florø. In 2009 the agreement, which focuses on athletics for children and young people, was extended, making GDF SUEZ E&P Norge the main sponsor of the club through 2011. The club has more than 900 members. The GDF SUEZ Gjøa base is located in Florø, and through Florø Turn & Idrettsforening we wish to contribute to positive activities in the local community.

As part of the cooperation with DNT, GDF SUEZ E&P Norge

supports projects by Stavanger Turistforening, Flora Turlag and Hammerfest og Omegn Turlag. In 2010 we contributed to the opening of a new marked route from Hyen to Gjegnabu, a steep four hour hike reaching 1174 meters above sea level, near the glacier Ålfotbreen in Sogn og Fjordane, and to the future development of the Gjegnabu cabin.

Our team

Our employees as of February 2011

management

HSEQ

human resources

finance & admin.

communication

Management Management Terje Overvik Managing Director Kari Samnøen Advisor Management Support

Anne Blomberg Advisor Communication HSEQ HSE&Q Eva Fagernes Head of HSEQ

Wenche R. Helland Advisor Environment

Sigbjørn Dalane Adv Health & Work Environment

Brit Jorunn Marker Sr Adv Employment Conditions

Håvard Kalve Advisor Quality

Ole Kjetil Handeland Advisor HSE

Aina Skretting Østrått Adv Resource Management

Randi Eltvik Larsen Advisor Quality

human resources human resources

Bjørn Ravndal Sr Advisor C&P Management

Communication/pr communication

Elin Witsø Leader HSE Operations

Tor Ove Holsen Advisor D&I Management

Magnar Støle Head of Human Resources

Ulf Rosenberg Head of Communication

Jannecke A. Moe Advisor Environment

Stig Sandal Adv Emergency Management

Anne Svendsen Leader HR Operations

finance & admin. Johannes Finborud Chief Financial Officer

Sigurd Helgesen Manager Tax

Knut-Olaf Rusten Manager ICT

Marita Stenkløv Ulriksen Purchaser

Cecilie Bjelland General Counsel

Randi Følgesvold Controller

Tone Lise Pedersen Manager Finance

Gaute Barstad Leader ICT

Stian Nielsen Purchaser

Sissel Dyskeland Advisor Contracts

Eirik Matre Controller

Chris Gates Manager Contracts

Nils Ivar Sørensen Advisor ICT

Johan Bjerka Leader Economics

Eirik Sørensen Leader Operated JVs

Juliette Bou Controller

Tore Jan Landmark Leader Office Facility

Tommy Rafos Advisor ICT

Rasmus Osaland Economist

Anne Selbæk Leader Fin Application & GA

Lisbeth Helle Controller

Livar Haaland Manager Procurement

Anders Erik Haugen Manager Purchase

Nina E. Grundetjern Coordinator Administration

Trygve Bø Leader Financial Reporting

Riku Kangas Controller

Oddvar Aarberg Manager Logistics & Base

Jan H. Standal Purchaser

Renate Horpestad Coordinator Administration

Even S. Enge Controller

Marie Guldbrandsen Westre Controller

asset

Aleksandra Uzunova Controller

Vibeke Mowatt Adv Mar & Air Transport

Gerhard V. Sund Manager Drilling & Well

Kjell Y. Buer Principal Geologist

Cristophe Courtial Geophysicist

Azim Fiaz Controller

Asset asset

Tommy Andreassen Drilling Superintendent

Gildas Lageat Senior Geologist

Jochen Rappke Senior Geoscientist

Tom Baug Coordinator SAP

Atle Sonesen Head of Asset

Bjørn S. Ellingsen Drilling Superintendent

Wouter Hazebelt Senior Geologist

Caroline Haugvaldstad Trainee Geoscience

Geir Hillersøy Coordinator Material

Erik Schiager Advisor Asset Management

Mehryar Nasseri Drilling Engineer

Steve Bryant Senior Geologist

Matthew G. Reppert Senior Petrophysicist

Bjørn Hereid Coordinator Material

Tom K. Steinskog Leader Tech & Development

Sigbjørn Kalvenes Mgr Petroleum Technology

Cecile Damstra Principal Geophysicist

Arne Crogh Senior Engineer Production

Camilla Kruse Coordinator Material

Geir Pettersen Project Manager

Olivier Gorieu LNG Expert

Roy Hoel Geophysicist

Siv Kirstin Borgersen Senior Engineer Production

exploration

Neal Hewitt Senior Engineer Production

Carl Otto Houge Mgr Area Non-op Ventures

Raphaël Fillon Manager Barents Sea/Vøring

Nicolas Nosjean Senior Geoscientist

Philippe Bailly Senior Geologist

Serap Õzoglu Topdemir Principal Reservoir Engineer

Erling Kindem Mgr Area Non-op Ventures

Bjørg Solheim Mgr North Sea/Haltenbanken

René Thränhardt Senior Geologist

Magali Romanet Geologist

Pierre Olivier Senior Reservoir Engineer

Turid Moldskred Senior Advisor Development

Odd Fuglestad Principal Geophysicist

Jörgen Samuelsson Senior Geologist

Camilla Støckert Geologist

Torunn Haugvallstad Senior Reservoir Engineer

exploration exploration

Nirina Haller Senior Geophysicist

Tove Thorsnes Senior Geologist

Jan Willem Achterberg Leader Data Management

Andrea Reinholdtsen Trainee Reservoir Engineer

Tina R. Olsen Head of Exploration

Fanny Marcy Courtial Geophysicist

Wim Lekens Senior Geologist

Marianne Førland Advisor Technical

Hilde Ådland Mgr Asset Non-op Ventures

Paul Milner Manager New Venture

Alv Aanestad Senior Petrophysicist

Gunilla A. Steen Senior Geologist

Frode Gjerde Advisor GIS

gas & commercial

Operations

gas & commercial gas & commercial

Ove Harbo Sr Adv Business Development

Rebecca R. Christensen Manager Technical

Jens Petter Gjærum Team Ldr Op & Maintenance

Bente Brinchmann Team Ldr Health & Work Env

Karel H. Schothorst Head of Gas & Commercial

Morten Philbert Advisor Gas Operations

Kick Sterkman Offshore Installation Mgr

Nils Martin Bakka Team Ldr Op & Maintenance

Jan Turi Team Ldr Health & Work Env

Kjell Arne Abrahamsen Leader Upstream Commercial

Nils-Erik G. Lomheim Adv Upstream Commercial

Arild Jåsund Offshore Installation Mgr

Bjarte Rimereit Team Ldr Op & Maintenance

Bjørn-Peder H. Johansen Team Ldr Health & Work Env

David Gazel Ldr Sales & Transportation

Camille Rossi Coord Sales & Transportation

Per Langhaug Offshore Installation Mgr

Oddgeir Madsen Team Leader Deck & Marine

Torhild S. Jensen Coordinator Administration

Eirik Vestersjø Leader Infrastructure

operations operations

John Winterstø Offshore Installation Mgr

Ørjan Midttveit Team Leader Deck & Marine

Erik Winge Planner

Ole Johan Østvedt Mgr Business Development

Kjell Ola Jørgensen Head of Operations

Pål Hamre Team Ldr Op & Maintenance

John Arne Pedersen Team Leader Deck & Marine

Dag André Bogstrand Planner

Jone Harestad Engineer Operation

Harald Flesland Senior Eningeer Maintenance

Per Morten Kyvik Engineer Automation

Trond Myklebust Operations Technician

Martha Viste Operations Technician

Louise Drain Gas Dispatcher

Clarence Soosaipillai Senior Engineer Subsea

Dagfinn Ommundsen Operations Technician

Jan Rune Kalsvik Operations Technician

Stig Erling Sande Operations Technician

Årstein Bringsvor Leader Technical Area

Arne Bekkeheien Engineer Maintenance

Vidar Mostrøm Operations Technician

Åse Bleie Operations Technician

Aimée R. Lobben Operations Technician

Olav Dolonen Senior Engineer Process

Raju Pakalapati Engineer Process

Ove Lid Operations Technician

Ingunn Frette Operations Technician

Rune Dønheim Operations Technician

Hans Chr. Rentsch Sr Eng Structure/Inspection

Malika Jendoubi Trainee Process Engineering

Kjersti M. Byrkjeland Operations Technician

Håvard H. Johansen Operations Technician

Gunnar Løvås Operations Technician

Midhat Durakovic Sr Eng Maint Technical Safety

Thorleif Simonsen Engineer Metering

Tom Borger Nielsen Operations Technician

Joakim Borgen Operations Technician

Ståle Johansen Operations Technician

Svein Arvid H. Nordal Operations Technician

Ă&#x2DC;yvind Torjussen Operations Technician

Cato StrĂ¸msnes Operations Technician

Nils Stian Finnseth Operations Technician

Lars Westbye Operations Technician

Jostein B. Nilssen Operations Technician

Hans Ottar Moen Operations Technician

Atle Hovstad Operations Technician

Jan Rasmussen Operations Technician

Tommy Karlsen Operations Technician

Roger Aase Operations Technician

Kai Solheim Trainee Operations

Directors’ report GDF SUEZ E&P Norge AS is engaged in the exploration for and production of oil and gas on the Norwegian Continental Shelf (NCS). The company’s head office is located in Sandnes. At the end of 2010 the company portfolio contained 37 licenses on the Norwegian Continental Shelf, including shares in the Njord, Fram, Snøhvit, Gjøa, Vega South and Gudrun fields. The company is operator of the Gjøa field (PL153 and PL153B) which started producing in November 2010 and of exploration licenses PL423BS and PL423S Gråtass, PL469 Pumbaa and PL530 Heilo. In October 2010 the company established a fully owned Norwegian subsidiary, GDF SUEZ E&P Greenland AS, with the purpose to engage in the exploration for and production of oil and gas in Greenland. The company was later awarded two licenses in the Baffin Bay licensing round.

Exploration New acreage In 2010 the company was awarded three new licenses in the APA 2009 licensing round. The awards included a 15% share in PL090E which is an extension to PL090 Fram in the North Sea; a 30% share and operatorship in PL423BS which is an extension

to PL423S Gråtass in the North Sea and a 10% share in PL547S, also in the North Sea. During the year the company acquired a 10% share in PL341 Stirby from Spring Energy and a 5% share in PL468 Dovregubben from Det norske. The company submitted a com-

– Following the transfer of operatorship and start of production on Gjøa, GDF SUEZ E&P Norge is now one of eight operators of fields in production, and among the top ten producers and reserve owners on the Norwegian Continental Shelf Jean-Marie Dauger

prehensive application in the APA 2010 licensing round in the autumn of 2010. Awards were announced in mid January 2011 and the company was offered five new licenses. In November, GDF SUEZ E&P Greenland AS, a fully owned subsidiary, was awarded, as part of a consortium lead by Shell, a 26.25% share in Blocks 5 and 8 in the Baffin Bay, West Greenland licensing round. Drilling In the North Sea the company participated in the drilling of well 15/3-9 in PL187 Brynhild near the Gudrun field. An oil and gas discovery was made. The Norwegian Petroleum Directorate estimates recoverable reserves to be between 0.5 and 3 million Sm3 oil equivalents. The discovery will probably be developed through a tie-in to the Gudrun field. Also in the North Sea, the company participated in the drilling of well 24/12-6S in PL341 Stirby. Unfortunately the well was dry. In the Norwegian Sea the company participated in the drilling of well 6604/10-1 in PL326

Gro, which was drilled to appraise the Gro gas discovery made in 2009. Gas was found, but the reservoir had a poorer quality than anticipated. Due to the disappointing results the majority in the PL326 Gro license have decided to relinquish the license effective 18 June 2011. Total capitalized license cost in the amount of NOK 232 million will be impaired in 2011.

Development Gjøa The Gjøa field started production on 7 November and by 15 November all completed wells were on stream. The completion of the Gjøa development project progressed well during 2010, and only minor work remains to be completed in 2011. The drilling of wells is progressing according to plan. By the end of 2010, five of the total 13 planned wells were completed.

In accordance with the authorities’ conditions for approval of the Gjøa Plan for Development and Operation (PDO), the Gjøa part nership transferred the owner ship of the Gjøa gas pipeline to Gassled with effect from 1 June

Jean-Marie Dauger Chairman of the Board Graduate of the ‘Ecole des Hautes Etudes Commerciales’. He has been working in the Group since 1978 and holds the position of Executive Vice President, and is member of the GDF SUEZ management committee. Dauger is also in charge of the Global Gas and LNG business line. He is ’Chevalier de la légion d’honneur de l’ordre national du mérite’.

Directors’ report

2010. As compensation for this, the company received an initial share in Gassled of 0.085% from the same date. In accor dance with the merger agree ment the company’s ownership interest will increase to 0.325% with effect from 1 January 2011. On 25 November the operator ship for the Gjøa field was transferred from Statoil to GDF SUEZ E&P Norge AS. This is the company’s first producing operatorship on the Norwegian Continental Shelf and a mile stone for the company. The opera tion of Gjøa after the operatorship transfer has focused on estab lishing high regularity on the platform and completing the remaining tasks carried over from the development project. Vega South The production from Vega South, including Vega South Oil (VSO), started on 2 December. Production started with both wells and VSO is produced co-mingled with the gas. Gudrun The authorities approved the PDO for Gudrun in June 2010. The Gudrun field development

will include a manned jacketbased platform with facilities for partial processing of oil and gas. The unstable oil and rich gas will be piped to Sleipner A for further processing. The Gudrun gas will be exported via Gassled’s Area D pipeline network, and light oil will be piped to Kårstø in exis ting pipelines for processing and export. Modifications will be needed at Kårstø to handle the new Gudrun/Sleipner blend. The field will be produced from seven wells and production is expected to start in the first quarter of 2014. The work on Gudrun is progressing well and several major contracts were awarded during the year in accordance with the plan. Njord North West Flank (NWF) The Njord partners have decided to develop the NWF by drilling two long reach wells from the Njord platform. The gas/conden sate well stream will be pro cessed and co-mingled with the Njord gas production. The drilling of the wells is expected to start during the first half of 2011 and production start-up will be during the first quarter of 2013. The added production from NWF is

expected to extend the Njord field life with up to two years. Gygrid The Gygrid oilfield was discovered in 2009 and is located in PL348 in the Norwegian Sea, close to the Njord field. Statoil has included the Gygrid development in their fast-track development effort which comprises a total of four fields. The development of Gygrid will include the installation of one four-slot subsea template and the drilling of one oil well and one water injection well. The well stream will be piped to the Njord A platform for processing and export. The Gygrid partners are expected to approve the field development concept this spring in order to submit a PDO in April, which will allow production to start in late 2012.

Operations Gjøa Production from Gjøa started on 7 November 2010 and the company’s share accumulated to a total of 0.9 million boe or on average 16,690 boe per day for the remainder of the year. The start-up has progressed well and the five wells have been comple

ted; three oil wells and two gas wells were all on stream before the end of November. As a result of vibrations and high noise levels in the gas export risers when exporting gas over certain volumes, it has not been pos sible to utilise the maximum gas export capacity which the risers were designed for. Work is ongoing to measure the extent of the problem and identify solutions that can rectify this problem. On 25 November the operatorship for PL153 including the Gjøa facilities was transferred from Statoil to GDF SUEZ E&P Norge. The transfer process was well planned, and the takeover was conducted in a seamless manner without any negative effect on the operation of the field. Njord Total production from the Njord field in 2010 was 4.4 million boe or 11,975 boe per day, which is in line with the production in 2009. The good performance on Njord is basically due to the successful infill drilling campaign on the field, which is offsetting the effect of the natural field decline and the negative impact of a failure in a gas export

Michel Bayle Board member

Rolf Erik Rolfsen Board member

Graduate of the ‘Ecole Polytechnique’ and ‘Ecole Nationale des Ponts et Chaussées’. He worked for different port authorities from 1970 to 1986 and in the Group from 1986 until 2007, where he held positions as Research and Development Vice President, and eventually E&P Vice President for the last seven years, until he retired from the Group in 2007.

Chairman of the Board of Directors of Technip Norge AS and of CGGVeritas Services (Norway) AS as well as Wavefield Inseis AS. From 2001 to 2009 he was a member of the main Board of Directors of Technip S.A. From 1987 to 2000 he was Managing Director of TOTAL Norge AS and of Fina Exploration Norway from 1999 to 2000. His academic background is in economics and he is ’Chevalier de la légion d’honneur’.

c ompressor on Kårstø at the start of the year. Fram Total Fram field production in 2010 was 3.6 million boe or 9,820 boe per day, which is a decrease of 4% from 2009. The performance of the Fram reservoir has been good. The expected decline in production due to pressure drop in the reservoir and increased water production has not yet occurred. Snøhvit Total production from Snøhvit was 4.9 million boe in 2010 or 13,290 boe per day, which is an increase of 48% from 2009. The improvement is due to better regularity and improved pro duction level which is a result of the repair works that were carried out during 2009. However, there have been several unplanned stops and extended shutdowns due to continued problems with sub-coolers which have impac ted production negatively. A fiveweek shutdown is planned in 2011 to repair and replace equipment. Vega South Production from Vega South started on 2 December. The company’s

total share of production in 2010 was 0.02 million boe or 520 boe per day for the remainder of the year. The 2010 production has been negatively affected by technical problems with the wells and third party equipment which have still not been satisfactorily corrected. Short term actions have been taken and Vega South is now producing at stable condi tions slightly below production potential. The operator is now evaluating possible solutions to the long-term problems.

Working environment At year end the company had 169 employees. In accordance with applicable laws and regula tions the company registers its employees’ absence due to illness. During 2010 the absence due to illness has been 1.74% (1.6% in 2009). The company conducts an annual working environment survey which includes all employees and contractors. The survey covers a wide range of factors impacting the working environment. The results from the survey form the basis for the preparation of activity plans required to maintain a good

working environment. The conclusion from the last survey is that the working environment and general welfare in the workplace is good.

with in order to promote gender equality and stop differential treatment of women and men. There is a continuous effort to adhere to these requirements.

In 2010 GDF SUEZ E&P Norge AS had three incidents involving personnel. Two of these incidents led to lost time injuries (LTI). The first happened early in the year (during the construction phase on Gjøa) and the last happened shortly after takeover of the operatorship on Gjøa. Both incidents resulted in hospital treatment. Both injured parties were back at work after a short period of time.

By year-end 48 of our 169 employees were women. The management team consists of nine persons of whom two are women. Two of seven members of the Board of Directors are women. 33 new employees were recruited in 2010, of which 11 are women and 22 men. All salaries are established without preju dice. Two employees work parttime and there are no differences in the working hour regulations for women and men.

The incidents are: • A fractured ankle, as a result of slipping on an icy walkway. • An injured toe, after it was caught in an electric door. • A hand injury, as a result of incorrect handling of a pellet for the flare ignition system.

Gender equality The Board of Directors and the Managing Director are attentive to society’s expectations and the legal requirements which the company is expected to comply

Discrimination The Discrimination Act’s objective is to promote gender equality, ensure equal opportunities and rights, and to prevent discrimina tion due to ethnicity, national origin, descent, skin colour, language, religion and faith. The company is working actively, with determination and systema tically to promote the act’s purpose within our business. Included in the activities are recruiting, salary and working

Didier Holleaux Board member

Anne Ravignon Board member

Graduate of the ‘Ecole Polytechnique’ and ‘Ecole Nationale Supérieure des Mines’. He has been working in the Group since 1993, holding various positions within the transport, LNG, distribution and exploration/production divisions. Since March 2007 he holds the position of E&P Senior Vice President.

Graduate of ESSEC (Ecole Supérieure des Sciences Economiques et Commerciales) in 1998. After beginning her career in investment banks (Paribas and JP Morgan), she joined GDF SUEZ as Corporate Finance Officer in 2002 and integrated Corporate Mergers & Acquisitions team in 2005. In 2009, she was appointed Chief of Staff for the Group CFO and Financial Communications Director in 2010.

Directors’ report

conditions, promotion, develop ment opportunities and protec tion against harassment. The company aims to be a workplace with no discrimination due to reduced functional ability and is working actively to design and implement the physical condi tions in such a manner that as many as possible may utilise the various functions. Individual adjustments of workplace and responsibility are made for employees or new applicants with reduced functional ability.

Environment 2010 was the first year with production from the Gjøa field. Although the operatorship was not transferred from Statoil to GDF SUEZ E&P Norge AS until 25 November, this section involves figures from all of 2010, from Gjøa Semi, Vega and Transocean Searcher. The Gjøa field is developed to cause as little environmental impact as possible. Electricity from shore is the main source of power for the Gjøa installation and there is a single fuel low NOx turbine operating the gas export compressor. In addition

there is a waste heat recovery unit installed. Closed flare during regular operation also contributes to reduction of environmental impact. Discharges to the environment and chemical use and discharge from production and drilling operations are reported to the environmental authorities according to current regulations. All discharges were within the given permits. 97% of chemicals discharged to sea were green chemicals and are not expected to cause any environmental impact. Within GDF SUEZ the use of envi ronmentally friendly chemicals is emphasized. One red chemical was used, but there were no dis charges of red chemicals in 2010. There was a discharge of yellow chemicals of 118 tons, well within the granted permit. There were seven minor acciden tal spills to sea during 2010. All were related to the drilling ope rations performed by the drilling rig Transocean Searcher. There was one spill of oil-based mud and six spills of hydraulic oil, mainly from operations involving use of ROV. The total volume of the spills was 29.6 litres.

2010 was the second year of drilling on Gjøa. Water-based mud is used while drilling the top sections, while the lower sections (including 17 ½“) are drilling with oil-based mud. The oil-based drilling waste is sent onshore and handled (reused or destructed) at the mud contractor’s facilities. The Gjøa field generated 274 tons of non-hazardous waste and 11,017 tons of hazardous waste in 2010. Start-up activities have influenced the operations in 2010. High flare volumes came as a result of start-up of the Gjøa and Vega fields and problems in connection with the gas export compressor. The most important environmental indicators for emissions to air were: Flaring Fuel gas consumption Diesel consumption CO2 emissions NOx emissions

12.03 mill. Sm3 3.66 mill. Sm3 6,453 tons 90,970 tons 505 tons

GDF SUEZ is a member of the NOx fund. Through payments to the NOx fund GDF SUEZ contri

butes to the funds available for initiatives to reduce NOx emis sions in the industry.

Financial market risk The company’s financial result is affected by fluctuations in oil and gas prices and foreign cur rency exchange rates. The company’s loans are stated in NOK with a floating interest rate. Consequently, the company’s profit and financial position will be affected by changes in the interest rate market. GDF SUEZ E&P Norge AS does not have any financial instruments to protect itself against financial market risk. The risk associated with our counterparties’ inability to fulfil their obligations is considered low, as the company’s sales mainly are to companies within the Group and to other large cor porations. The company has not realised losses on receivables during preceding years. The total exposure related to currency, interest and price fluctuations is monitored and evaluated by the Group as a part of the overall evaluation of the Group’s total exposure. Possible

Hilde Ådland Board member

Gerhard V. Sund Board member

Graduate from SiT (process engineering). She worked 6 years for Kværner Engineering and Kværner Installasjon with process design and commis sioning, before joining Statoil in 1996. In Statoil she has held various positions as Process Engineer, Operation & Maintenance Leader on Heidrun TLP and later as Offshore Installation Manager on Kristin Semi. She started working for GDF SUEZ E&P Norge in February 2008 and has held positions as Sr. Facility Engineer and Manager Asset Non-Operated Ventures.

Graduate of the NTNU (petroleum engineering) and BI (management). He worked 9 years with Amoco and 10 years with BP in different exploration and production roles both offshore and onshore. 2006–2008 he was Offshore Installation Manager at Valhall before joining GDF SUEZ E&P Norge as Manager Drilling & Well in September 2008.

actions are implemented at a Group level in accordance with existing procedures.

Financial aspects The company produced a total of 13.7 million boe in 2010, an increase of 21% compared to 2009. This is primarily a result of the improved regularity on Snøhvit and the new production from Gjøa and Vega South in November and December. Total sales in 2010 amounted to 13.8 million boe giving total revenues of NOK 4,961 million. A total of 4.9 million bbls of crude oil and condensate was sold in 2010. This is 8% less than in 2009. Revenues from the crude oil and condensate sales were NOK 2,462 million, or 21% higher than in 2009. Total revenues increased as a result of an increase in the average Brent Blend crude oil price from just under USD 62 per bbl in 2009 to over USD 82 per bbl in 2010, partly offset by decreased sales volumes. The company sold 1.1 billion Sm3 of gas including Snøhvit LNG in 2010. All gas was sold to

other GDF SUEZ companies and amounted to NOK 1,946 million. The increase in gas revenues from NOK 1,644 million in 2009 is basically due to higher gas sales on Snøhvit and gas sales from Gjøa, partly offset by slightly lower average gas prices in 2010. The sale of NGL and LPG mix amounted to NOK 539 million in 2010 compared to NOK 297 million in 2009. The increase in revenues was mainly due to NGL sales from Gjøa and higher average prices as a result of the increase in oil prices. A total of 1.5 million boe of these pro ducts were sold in 2010, slightly higher than the 1.3 million boe sold in 2009. Net cash flow from operating activities in 2010 was NOK 1,681 million, compared to NOK 2,948 million in 2009. The investments in 2010 amounted to NOK 2,721 million, compared to NOK 4,580 million in 2009. The majority of the 2010 invest ments were in the ongoing development of the Gjøa and Vega South fields. The company’s inter-company long-term debt at the end of 2010 was NOK 13,103 million,

compared to NOK 11,611 million at the end of 2009. The increased long-term loan is due to the ongoing development of the Gjøa and Vega South fields. The company’s result after tax in 2010 was NOK 755 million, compared to NOK 623 million in 2009. Total equity after the allocation of proposed dividend is NOK 2,328 million, giving an equity ratio of 10%. Distributable equity at the end of the year is NOK 0.136 million The accounts have been pre pared on a going concern basis. The Board of Directors and the Managing Director confirm the basis for this in accordance with section 3-3 of the Norwegian Accounting Act. The Board of Directors is not aware of any conditions of significance that could impact the company’s result and financial position as per 31 December and which have not been reflected in the accounts.

Greenland licensing round. In accordance with the rules in Article 1-7, second subsection of the Accounting Act the company has decided not to prepare 2010 financial statements for the Greenland affiliate. As a result there is no consolidation of the affiliate accounts in the company’s 2010 financial state ments. The 2010 transactions will be included in the 2011 accounts for the affiliate. The value of shares in GDF SUEZ E&P Greenland AS is equal to the funds injected in the company in 2010. The Board of Directors recom mend the following distribution based on the 2010 accounts: Net result 2010 NOK 754 859 451

Retained earnings NOK 366 583 451 Dividend NOK 388 276 000

The fully owned subsidiary GDF SUEZ E&P Greenland AS had no revenues in 2010 and incurred costs in the amount of NOK 19.4 million related to the West

31 deCember 2010 / 23 marCH 2011

Jean-Marie Jacques Dauger Chairman of the Board

Michel Marie Bayle Board member

Anne Sophie Christine Ravignon Board member

Rolf Erik Rolfsen Board member

Didier Holleaux Board member

Hilde Ådland Employee elected representative

Gerhard Våland Sund Employee elected representative

Terje Overvik Managing Director

10 annual accounts

Income statement Note

2010

2009

4 947 755 646

3 972 880 863

Operating Income Sales oil and gas Tariff income Total operating income

12 806 477

4 960 562 123

3 972 880 863

1 065 273 130

1 146 795 273

339 564 786

560 973 355

Operating expenses Operating expenses Exploration expenses Payroll expenses

5, 6

57 252 258

68 549 503

Depreciations

1 031 247 239

809 517 854

Impairment

5 987 403

Other operating expenses

50 450 432

37 367 048

Total operating expenses

2 543 787 844

2 629 190 435

Operating profit

2 416 774 279

1 343 690 428

Financial income and expenses Interest income Foreign currency exchange gain Interest income from group companies

Foreign currency exchange loss Interest expenses to group companies

Other interest expenses Net financial items Operating profit before tax

Tax expenses

Net income

4 094 207

1 793 440

106 585 228

136 801 028

6 671 567

17 435 797

184 783 430

317 930 592

170 290 984

126 381 158

143 475

7 587 073

237 866 886

295 868 557

2 178 907 393

1 047 821 871

1 424 047 943

424 984 885

754 859 451

622 836 986

388 276 000

537 700 000

Allocated as follows: Proposed dividend

Transfer retained earnings

366 583 451

85 136 986

Total allocations

754 859 451

622 836 986

Balance sheet Note

2010

2009

7, 16

20 006 158 287

17 770 942 160

ASsets Fixed assets

Tangible fixed assets Property, plant & equipment Financial assets Shares in subsidiary Total fixed assets Current assets Drilling equipment and spare parts

Receivables Accounts receivable from operators Trade accounts receivable Other receivables Total receivables Cash and cash equivalents Total current assets

9 3

Total assets

273 739

20 006 432 027

17 770 942 160

20 916 011

40 563 766

118 297 857

36 765 436

794 831 481

14 181 916

2 024 360 239

1 358 056 525

2 937 489 577

1 409 003 877

315 390 196

401 582 539

3 273 795 784

1 851 150 182

23 280 227 811

19 622 092 343

Equtiy and liabilities Equity

Paid-in capital Share capital Share premium reserve Total paid-in capital Retained earnings Other equity Total equity

12, 13

141 500 000

1 273 500 000

1 415 000 000

913 158 648

548 367 637

2 328 158 648

1 963 367 637

Liabilities

Provisions Pension liability Deferred tax Other provisions Total provisions Other long-term liabilities Long-term loan, parent company Current liabilities Accounts payable Public duties payable Accounts payable to operator Dividend Other short-term liabilities Total current liabilities Total liabilities Total equity and liabilities

56 895 372

33 838 352

4 581 040 988

3 180 371 890

1 829 369 676

1 244 988 199

6 467 306 036

4 459 198 440

13 102 835 903

11 611 031 548

15 543 970

28 002 590

40 867 068

11 451 850

644 912 004

632 711 714

388 276 000

537 700 000

292 328 182

378 628 563

1 381 927 224

1 588 494 717

20 952 069 163

17 658 724 706

23 280 227 811

19 622 092 343

Cash flow statement Operating profit before tax Tax refund, exploration expenses Depreciations Changes in accounts receivable and accounts receivable operators

2010

2009

2 178 907 393

1 047 821 870

210 056 624

1 067 468 634

840 277 430

-862 181 986

277 538 279

-258 330

-470 525 795

Difference between pension cost and amounts paid into pension scheme

14 909 564

7 616 591

Changes in other balance sheet items

-927 820 950

1 245 064 681

Net cash flow from operating activities

1 681 080 949

2 947 793 056

Acquired tangible fixed assets

-2 721 103 906

-4 580 239 175

-273 739

Net cash flow from investing activities

-2 721 377 646

-4 580 239 175

New long-term borrowings

1 491 804 355

3 413 130 972

-537 700 000

-1 400 850 000

Net cash flow from financing activities

954 104 355

2 012 280 972

Net change in cash and cash equivalents

-86 192 342

379 834 852

Cash and cash equivalents at beginning of year

401 582 538

21 747 686

Cash and cash equivalents at end of year

315 390 196

401 582 538

Changes in accounts payable and accounts payable operators

Shares in subsidiary

Dividend

Notes 01 Accounting policies The annual accounts have been prepared in accordance with the Norwegian Accounting Act and Norwegian generally accepted accounting principles.

Depreciation of oil and gas production facilities is Spare parts and drilling equipment. Spare parts calculated in accordance with the unit-of-sales and drilling equipment are valued at the lower of cost or method. In accordance with this method the market value. Cost is estimated using the FIFO method. annual depreciation will be determined based on Capital spare parts are capitalized with the investment. the relationship between the annual sold volume Revenues. The sale of crude oil and gas is and the estimated total oil and gas reserves that Over-/under lift and petroleum in stock. recognized through sales method. For crude oil can be recovered with the existing production Obligations arising as a result of lifted quantities of the point of delivery is at the offshore loading point facilities in use. Depreciation of onshore equipment crude oil that are larger than the company’s participaor at shipment from terminal. Point of delivery for is calculated in accordance with the straight-line ting interests in a license, are valued at production gas is at the gas receiving terminal onshore. method. Other property, plant and equipment is cost. Receivables arising as a result of lifted quantities capitalized and depreciated linearly over the of crude oil that are less than the company’s share in a Expenses. Expenses are expensed as incurred estimated useful life. Costs for maintenance are license, are valued at the lower of production cost and in accordance with the matching principle; either expenced as incurred, whereas cost for improving sales price. Petroleum in stock which has not passed along with the revenues they have generated or and upgrading property, plant and equipment are the Norm Price-point, is valued at production cost. identified as a periodical expense. added to the acquisition cost and depreciated with the related asset. Accounts receivables. Trade accounts receivables Estimates. In accordance with Norwegian and other receivables are recorded at face value Subsidiaries and investments in associates. generally accepted accounting principles, the reduced by a provision for anticipated losses. Subsidiaries and investments in associates are management of the company is responsible for valued at cost in the company accounts. The the estimates and assumptions that affect the Asset retirement obligation. When the retirement investment is valued as cost of the shares in the valuation of assets and liabilities in the balance obligation has incurred, the liability amount is recog subsidiary, less any impairment losses. Group con- nized as a long-term provision and the same amount sheet and depreciations in the profit and loss statement. The final realizable values may deviate solidated financial statements are not prepared as is capitalized as part of the producing asset. The the Group is included in the consolidated financial from these estimates. asset cost is expensed through depreciations over the statements at the parent company in France. remaining useful life of the asset. The future changes Classification and assessment of items in in asset retirement obligation estimates are capitalized Assets liabilities and expenses related to the balance sheet. Current assets and shortas part of the asset and charged to profit and loss term liabilities include items due within one year and participating interests in exploration and prospectively over the remaining useful life of the items related to ordinary working capital. All other production licenses (joint ventures). asset. items are classified as fixed assets/long-term debt. The company’s participating interests in explora tion and production licenses on the Norwegian Current assets are valued at the lower of cost Tax expense. Tax expense reflects both taxes on Continental Shelf are accounted for in the income and fair value. Short-term debt is valued at the current taxable income and change in deferred statement and the balance sheet in accordance historical nominal value. income taxes. Deferred tax is calculated based on with the proportional consolidation method. Fixed assets are valued at cost, but written net temporary differences between the book and tax down to fair value if the decline in value is not values at year end. The calculation has taken into Transfer of joint ventures shares. Transfer of expected to be temporary. Long-term debt is account tax loss carry forward and uplift. The current interest in a petroleum license on The Norwegian stated at the historical nominal value. tax rate has been used in the calculation of the Continental Shelf require approval from the deferred tax expense. Foreign currency. Monetary balance sheet Norwegian Government. Under such transactions The uplift reduces the special petroleum tax. items in foreign currency are converted at the the sale price is generally considered to be on an Earned uplift from capitalized expenditures has been exchange rate on the closing balance date. ”after tax” basis (after-tax transaction) as the consi- fully reflected in the tax calculation. All foreign currency transactions are recorded deration is not taxable for the seller and not in NOK on the basis of the company’s monthly deductable for the buyer through depreciations. Pensions . Accounting for pensions is based on a book-keeping currency exchange rates, which Acquisitions of interest in oil and gas licenses linear vested principle and on expected wages at the approximate market rates. are regarded as business combinations and are point of retirement. Changes in pension schemes are accounted for using the purchase method. The amortized over the remaining vesting period. Exploration costs. Cost regarding geological acquirer purchases net assets and recognizes the Estimate deviations are continuously charged to studies and analysis are expensed as incurred. assets acquired and liabilities and contingent liabili- equity. Social security tax is included in the pension Exploration drilling costs are temporarily capita tites assumed, including those not previously cost and liabilities. lized until new potential oil and gas reserves have recognized by the seller. At the acquisition date, been evaluated (the successful efforts method). the costs of a business combination are allocated Accounting for license cost. The Company’s When new reserves are discovered and fully by recognizing the identifiable assets, liabilities and account reflects the net cost after recharging partners developed and put into production, the exploration contingent liabilities at the fair value at that date. their share of license costs on licenses which the drilling costs will be depreciated based on theFor oil and gas producing properties purchase is company operates unit-of-sales method. Drilling costs related allocated between exploration rights, facilities, to dry holes are expensed. wells and goodwill. Acquisitions of interest in oil Cash flow statement. The cash flow statement is and gas licenses that are deemed to be asset are presented using the indirect method. Cash and cash Property, plant and equipment. Costs accounted for at the purchase price at the date of equivalents include bank deposits. including interest on building loan related to the the acquisition. development of commercial oil or gas fields are The transaction date is the date when effective Leasing. GdF Suez E&P Norge AS has only capitalized as a part of the installations. Capital control is transferred from seller to the acquirer. operational leasing contracts. The cost is continuexpenditures on fields in production are capitalized The acquirer`s income statement incorporate the ously charged to the profit and loss. based on information from the operator. profits and losses of the acquired interest from the transaction date. 54

02 Financial market risk The company’s financial result is affected by fluctuations in crude oil and gas prices and foreign currency exchange rates (mostly USD and EURO). The company’s loans are stated in NOK with floating interest rate. Consequently, the company will be affected also by changes in the interest rate market.

03 Bank deposits NOK 11 847 142 of total bank deposits are restricted funds relating to withheld taxes. The company has an unused cash credit of NOK 15 000 000.

04 Operating revenues The company’s production has been sold as follows: NOK 1 000

Norway

France

Crude oil NGL

465 508

Gas Infrastructure

Total

Total 2010

Total 2009

2 156 405

1 890 507

539 390

297 178

1 946 060

1 644 140

305 901

141 055

12 806

Gas

Condensate

73 882 1 946 060

784 215

1 946 060

2 230 287

4 960 562

3 972 881

05 Salaries and fees 2010

2009

Salaries

189 713 610

136 880 608

Recharged salaries

210 614 820

132 330 182

Social security tax

26 810 094

19 467 128

Pension costs

31 697 134

21 623 799

Other employee benefits

19 646 240

22 908 151

Total

57 252 258

68 549 503

152.5

132

Number of full-time equivalent in fiscal year

The Managing Director received in 2010 NOK 4 093 801 in salary, bonus and other benefits. The Managing Director is entitled to resign at the age of 64 years with a pension of 66% of full salary. In 2010 remuneration to the Board was NOK 220 000.

Share options. The General assembly of GDF SUEZ has decided restricted share plans and share subscription option plans. The restricted plan is subject to certain conditions, such as stay put in the company for a certain period. Some employees of GDF SUEZ E&P Norge AS were invited to participate in the plans. The affect of these plans is considered immaterial in the accounts. Audit fees. Audit fees in 2010 totaled NOK 1 335 400 excl. VAT. Other services from auditors total NOK 216 100 excl. VAT. Such other services include assistance with the tax return preparation and correspondence with the Norwegian Oil Taxation Office. 55

Notes

06 Pensions The company is required to have an occupational pension scheme in accordance with the the Norwegian law on required occupational pension (”lov om obligatorisk tjenestepensjon”). The company’s pension scheme meets the requirements of that law. The company has a retirement benefit plan covering all permanent staff. This benefit plan gives the employees the right to receive defined future pensions. These are mainly dependent on the number of years in service and the level of compensation at retirement. The obligation up to 12G is financed through an insurance company, the rest is financed trough normal operation.

Pension rights earned during the year

2010

2009

30 710 196

21 215 004

Interest expence on earned pension rights

2 622 339

1 609 890

Yield pension cost

-1 635 401

-1 201 095

Estimate change

Net pension cost

31 697 134

21 623 799

2010

2009

Assets/obligations Pension benifits obligations Plan assets Estimate change

92 095 462

61 008 352

-44 864 085

-27 170 000

9 663 995

56 895 372

33 838 352

2010

2009

Discount rate

3.90%

4.40%

Expected increase in salaries

4.00%

4.25%

Expected increase in pensions

1.20%

2.70%

Expected increase in basis for calculating government contributions

3.75%

4.00%

Expected return on plan assets

5.30%

5.60%

Net pension liability Financial assumptions

07 Tangible fixed assets

Acqusition cost 01.01.10 Correction of opening balance Aquisition cost 01.01.10 Acquired during the year Disposal during the year

Production plants

Assets under development

Equipment etc.

Capitalized exploration cost

10 948 057 704

9 134 047 403

183 356 738

699 985 266

-8 732 663

10 948 057 704

9 134 047 403

174 624 075

699 985 266

20 956 714 447

486 393 077

2 434 365 528

106 684 127

243 636 892

3 271 079 624 4 616 259

Total 20 965 447 110

4 616 259

Reclassification

10 761 326 891

-10 636 675 940

14 317 762

-138 968 713

Acqusition cost 31.12.10

22 195 777 671

931 736 991

291 009 706

804 653 445

24 223 177 813

Acc. depreciation 31.12.10 Book value as of 31.12.10 Actual depreciation

4 142 789 983

74 229 543

4 217 019 526

18 052 987 689

931 736 991

216 780 162

804 653 445

20 006 158 287

994 608 897

36 638 341

1 031 247 239

Actual impairment

Estimated useful life

* Depreciation according to Unit of Sales method

3–8 years

08 Other provisions and obligations 2010

2009

Asset retirement obligation

1 342 269 846

746 564 146

Other long-term provisions

487 099 830

498 424 052

1 829 369 676

1 244 988 199

Other provisions

Asset retirement obligation. In accordance with license concession terms of the Production licenses which the company holds, the Norwegian State can take over the installations free of charge when the production ends or when the license expires. Alternatively the State can require the installations to be removed. In addition to provisions for future abandonment cost there has been made provisions for future removal costs regarding plugging and securing of production wells. The accretion expense is classified as operating expenses. 2010

2009

Asset retirement obligations at 1 January

746 564 146

497 390 299

Liabilities incurred/revision in estimates

559 484 305

224 401 675

Accretion expense

36 221 395

24 772 173

1 342 269 846

746 564 146

Long-term assets related to removal and abandonment at 1 January

414 430 019

246 262 452 224 401 674

Asset retirement obligations at 31 December

Additional assets/revision in estimates

559 484 305

Depreciation

-61 982 548

-56 234 107

Long-term assets related to removal and abandonment at 31 December

911 931 776

414 430 020

Assets related to removal and abandonment are also included in note 7.

Drilling commitments. The company, together with its license partners, is committed to take part in the drilling of wells in accordance with the license agreements. Contractual obligations (in thousand NOK) Obligations entered

2010

Thereafter

Total

2 078 499

2 283 843

4 362 342

The contractual obligations include the acquisition and construction of assets in licenses where the company has ownership interests.

09 Other receivables and inter-company balances The company has entered into an agreement with the parent company regarding financing. The loans are stated in NOK with floating interest. The inter-company balance as of 31.12.10 was NOK 13 102 835 903 (31.12.2008: NOK 11 611 031 548). Interest expenses on the loans in 2010 were NOK 358 238 979, of which NOK 187 947 996 are capitalized (2009: NOK 143 546 751). There was also as of 31.12.10 a short-term receivable toward the parent company of NOK 1 266 673 980 (2009: NOK 536 103 409).

Notes

10 Drilling equipment and spare parts Spare parts and drilling equipment are valued at the lowest of cost or market value. Cost is estimated using FIFO method. Capital spare parts are capitalized with the investment. 2010

2009

Drilling and well equipment

20 916 011

23 511 293

Spare parts

17 052 473

20 916 011

40 563 766

2010

2009

1 400 669 098

581 204 766

Total inventories

11 Taxes Specification of the tax expense for the year: Change in deferred tax Tax effect of pension booked over equity Tax effect of aquisition cost booked over equity Tax refund exploration expenses Excessive tax provision previous years Total tax expense

6 355 016

2 626 254

14 124 846

84 612 396

-241 395 386

2 898 983

-2 063 145

1 424 047 943

424 984 885

2 178 907 393

1 047 821 871

The basis for calculating income taxes: Ordinary profit before tax Permanent differences

66 222 998

-11 415 756

-1 560 433 906

-1 571 636 112

Basis ordinary income tax

684 696 485

-535 229 997

Limited deduction of financial expenses for tax purposes

308 526 316

352 168 022

-1 085 365 344

-1 044 250 962

-92 142 543

-1 227 312 937

11 177 538 981

9 523 874 734

-56 895 372

-33 838 352

Changes in temporary differences

Uplift Basis special petroleum tax

Specification of basis for deferred tax: Differences that are netted: Fixed assets Net pension liability Crude oil inventory

8 570 883

12 370 437

20 767 399

26 887 520

Tax loss to be carried forward

-799 387 548

-1 461 545 000

Asset retirement obligations

-391 563 511

-293 359 569

9 959 030 832

7 774 389 770

Gain and loss account

Basis ordinary income tax (28%) Limited capitalization of interest on development projects Tax loss to be carried forward (50% only) Unused uplift Basis special petroleum tax (50%)

-197 588 199

-118 872 329

121 474 779

-186 064 173

-6 297 892 703

-5 462 367 761

3 585 024 709

2 007 085 507

Deferred tax liability: Ordinary income tax (28%)

2 788 528 634

2 176 829 137

Special petroleum tax (50%)

1 792 512 355

1 003 542 754

Total deferred tax

4 581 040 988

3 180 371 890

Reconciliation of tax expense and calculated tax expense: Ordinary profit before tax Marginal tax 78% Uplift Interest gain/loss on carry forward Other permanent differences Limited deduction of financial expenses Adjustments from previous years Tax expense

2010

2009

2 178 907 393

1 047 821 871

1 699 547 767

817 301 059

-417 762 471

-611 904 183

-26 641 323

-7 858 821

42 007 377

81 575 696

123 997 610

147 934 279

2 898 983

-2 063 145

1 424 047 943

424 984 885

The tax loss can be carried forward indefinitely.

12 Equity

Share capital

Share premium reserve

Other equity

Total

141 500 000

1 273 500 000

548 367 637

1 963 367 637

754 859 451

Equity 31.12.09 Current year’s profit Pension Dividend 2010 Equity 31.12.10

141 500 000

1 273 500 000

-1 792 439

-388 276 000

913 158 648

2 328 158 648

13 Share capital and shareholder information The share capital consists of 141 500 shares with nominal value NOK 1 000. All shares are held by the parent company, GDF SUEZ E&P International SAS. The parent company, GDF SUEZ E&P International SAS with its headoffice in Paris, issues consolidated statements which include GDF SUEZ E&P Norge AS and GDF Suez E&P Greenland AS.

14 Investments in subsidiaries Investments in subsidiaries are valued at cost in the company accounts.

Company

Business office

Stavanger

100%

GDF SUEZ E&P Greenland AS

15 Reserves (unaudited) According to reserve information published by the Norwegian Oil Directorate the company’s share of remaining reserves are: Oil (MSm 3) 0.42 1.08 0.00 3.00 0.54 2.80

Njord Fram Snøhvit Gjøa Vega South Gudrun

Gas (MSm 3) 1.66 1.10 17.98 10.08 1.31 1.50

NGL (MSm 3) Condensate (MSm3) 0.53 0.00 0.11 0.00 1.32 1.93 3.31 0.00 0.11 0.00 0.57 0.00

16 Subsequent events The 18 March 2011 the partnership in PL326 has taken the majority decision to fully relinquish PL326 effective from 18 June 2011. As of 31 December 2010 the total aquisition- and pre-capitalized drilling cost in the balance sheet is 232 MNOK. The cost will be fully impaired in 2011. 31 december 2010/23 march 2011

Jean-Marie Jacques Dauger Chairman of the Board

Michel Marie Bayle Board member

Anne Sophie Christine Ravignon Board member

Rolf Erik Rolfsen Board member

Didier Holleaux Board member

Hilde Ådland Employee elected representative

Gerhard V. Sund Employee elected representative

Terje Overvik Managing Director

Auditorâ&#x20AC;&#x2122;s report

Agency procontra Photos Jan Inge Haga Statoil Tom Haga Anne Lise Norheim Øyvind Hjelmen Jørn Steen Getty Images Dag Frøyen Oddgeir Havn/DNT Rune Osa/FTIF Paper Galleri Art Silk 150 / 250 g Circulation 1,000 (Eng) + 600 (Nor) Print Gunnarshaug

GDF SUEZ E&P NORGE AS VESTRE SVANHOLMEN 6, N–4313 SANDNES P.O. BOX 242, 4066 STAVANGER TEL: +47 52 03 10 00 FAX: +47 52 03 10 01