© 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. The KPMG logo and name are trademarks of KPMG International. ENERGY & NATURAL RESOURCES Business Reporting and Communications - A Key Corporate Governance Tool in the Global Petroleum Industry Andrew Jackson Chief Executive Officer, KPMG Saudi Arabia Tuesday December 5, 2006 INDUSTRIAL MARKETS

2 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Oil and Gas Investment Requirements* US$6 trillion to 2030 * :Based on 2003 version of IEA World Energy Investment Outlook

3 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Oil and Gas Investment Requirements* US$ 6 trillion to 2030 Global per annum requirements: Today By 2030 Inc.  OilUS$92 billion US$114 billion24 percent  GasUS$80 billion US$116 billion45 percent * :Based on 2003 version of IEA World Energy Investment Outlook

4 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Oil and Gas Investment Requirements* US$ 6 trillion to 2030 Global per annum requirements: Today By 2030 Inc.  OilUS$92 billion US$114 billion24 percent  GasUS$80 billion US$116 billion45 percent African per annum requirements: Today By 2030 Inc.  OilUS$10 billion US$14 billion40 percent  GasUS$5 billion US$10 billion100 percent * :Based on 2003 version of IEA World Energy Investment Outlook

5 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Major Constraints on Closing Investment Gap Capital ConstraintReporting Constraint

6 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Reporting Constraint Decision-making orientation Past financial performance Strategy and business model Insights - drivers and risks Outlook Boards Making Investment Decisions / CEOs Looking Out and Requesting Capital Major Constraints on Closing Investment Gap

7 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Major Constraints on Closing Investment Gap Business Constraint Current reporting formats External forces Fragmented capital markets Inter-sector capital race Reporting Constraint Decision-making orientation Past financial performance Strategy & business model Insights - drivers & risks Outlook Capital Markets Looking In and Allocating Capital Between Competing Investment Propositions

8 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. The Performance Reward Equation Performance = Reward Capital Licences to operate Reputation

9 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. The Performance Reward Equation Performance = Reward Reporting Strategy Performance Insights Capital Licences to operate Reputation

10 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. The Performance Reward Equation Performance = Reward ReportingCommunications StrategyUnderstanding Performance Synchronization Insights Precision Capital Licences to operate Reputation

11 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Business Reporting & Communications Framework Balanced reports portfolio Effective communications

12 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Business Reporting & Communications Framework Balanced reports portfolio Flagship business report Special purpose reports Effective communications

13 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Business Reporting & Communications Framework Balanced reports portfolio Flagship business report Special purpose reports Effective communications Careful report selection Common template Stakeholder perspectives  Decision-making models  Credibility

14 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Business Reporting & Communications Framework Balanced reports portfolio Flagship business report Special purpose reports Effective communications Careful report selection Common template Stakeholder perspectives  Decision-making models  Credibility Driven by a ‘fit-for-purpose’ reporting and communications strategy

15 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Evolution 2005/ Conformance ‘dividends’ 2007/ Performance ‘dividends’ 2008 and beyond – oil and gas sector ‘dividends’

16 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Evolution 2005/ Conformance ‘dividends’  Compliance  Clarity  Reputation 2007/ Performance ‘dividends’ 2008 and beyond – O&G sector ‘dividends’

17 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Evolution 2005/ Conformance ‘dividends’  Compliance  Reputation  Clarity 2007/ Performance ‘dividends’  Performance insight  Sustainability 2008 and beyond – O&G sector ‘dividends’

18 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Evolution 2005/ Conformance ‘dividends’  Compliance  Reputation  Clarity 2007/ Performance ‘dividends’  Performance insight  Sustainability 2008 and beyond – O&G sector ‘dividends’

19 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Oil & Gas Sector Investment Gap  US$6 trillion to 2030  Global per annum requirements: By 2030 Inc.  Oil US$114 billion24 percent  Gas US$116 billion45 percent  African per annum requirements: By 2030 Inc.  Oil US$14 billion40 percent  Gas US$10 billion100 percent * :Based on 2003 version of IEA World Energy Investment Outlook

20 © 2004 KPMG LLP, a UK limited liability partnership and the UK member firm of KPMG International, a Swiss cooperative. All rights reserved. Thank you Q&A Presenter’s contact details Andrew Jackson KPMG Al Fozan & Bannaga