NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group Overview – March 2010

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group Chair: Andrew Slaughter (Shell) Gov’t co-chair: Christopher Freitas (DoE) Assistant to chair: Kevin O’Donovan (Shell) Sub-Groups: Resource Endowment  Data and study analysis  Onshore gas  Onshore oil and EOR  Offshore oil and gas  Arctic  Unconventional oil  Oil infrastructure (crude oil pipelines)  Gas infrastructure (gathering, processing and pipelines) Each sub-group leader will sit on the Task Group, and be responsible for resourcing their sub-group. The Task Group could be expanded to include other more general contributors Alternate Gov’t co-chair: John Duda, NETL

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group TG Recruitment Status TG Leads: Andrew Slaughter Shell – chair, Kevin O’Donovan (Shell) asst. to chair, Government co-chair & alternate: John Duda (NETL), Christopher Freitas (DoE) Sub-group leads: Resource Endowment – Brenda Pierce (USGS), confirmed  Data and study analysis – Kevin Regan (Chevron), pending  Onshore gas – Devon, accepted in principle, nomination pending  Onshore oil and EOR – AERA declined, considering Occidental (or Hess?)  Offshore oil and gas – Richard Deselles, MMS, confirmed  Arctic – Gerry Worthington, ExxonMobil, confirmed  Unconventional oil – Jackie Forrest (CERA) - confirmed  Oil infrastructure (crude oil pipelines) – Enbridge, under discussion  Gas infrastructure (gathering, processing and pipelines) – Greg Zwick, Transcanada, confirmed

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group Sub – Group lead “gap” status Data and study analysis – Chevron (K Regan) personally ready and willing, awaiting tp management confirmation (given Chevron’s preferred focus on Fuels Study). Possible back up could be C. Sheppard, who has already agreed to take part wherever we can use him best Onshore gas – regular contacts with Devon continuing, nomination delayed by major recent deal and its organisational impact, nomination promised “soon” Onshore oil and EOR – AERA declined involvement, offered help in suggesting candidate from Occidental, not yet forthcoming. Other suggestions welcome. As a back up am also in discussions with Hess (M Gurfinkel) Oil infrastructure – regular contacts with Enbridge continuing, contacts are transitioning from Business Development Group to Government Affairs Group

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group Sub-Group staffing Sub-group leads need to play major role in recruiting their own teams The mission and deliverables of each sub-group should be agreed with the sub-group lead as early as possible TG leads and other members can assist in filling gaps or making suggestions for sub-group nominations to ensure a balance of perspectives is represented Sub-group leads should probably aim for no more than 4-8 people in each group Sub-group leads are responsible for workflow within their teams and for delivering progress reports and final deliverables Sub-group members may participate in TG meetings, (particularly for discussion of their own sub-group findings), but are unlikely to need to attend regularly

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group Additional topic areas to be considered LNG supply Produce short paper and final report sidebar, covering range of forecasts, NA receiving infrastructure and how it fits into overall NA gas supply Gas hydrates Review and update Hard Truths methane hydrates topic paper and include final report sidebar on potential scope and timing of NA hydrates development Mexico oil and gas Produce short paper and final report sidebar, covering range of forecasts, contribution to US oil supply and gas issues

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group - Framing Questions (first draft) What is the scope of technically recoverable conventional and unconventional oil and gas resources available in the US and Canada, according to most recent estimates? How much of this oil and gas can be developed and produced by 2050 under reasonable technical and economic assumptions? What are the main drivers behind existing NA oil and gas supply projections? What factors could significantly increase or decrease the productive potential of these resources? What policy tools are available to federal, state and provincial policy makers and regulators which could facilitate an appropriate pace of development for NA oil and gas? What could be the particular contribution of each of the major types of oil and gas resource considered in this study and what development challenges may they face? How will sufficient infrastructure (gathering systems, gas processing plants, pipelines) be developed to link these resources to the market?

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group – Outline TG work plan (first draft) 1.Recruiting, organising and framing (March-April) 2.Organise and Commission sub-group work (March-April - May) 3.Sub-group analysis in each focus area (May-June-July) 4.Collect sub-group findings, discuss TG integration, resolve cross sub-group issues (July-August) 5.Take findings to CSC for overall study integration (August-September) 6.Complete sub-group reports and outline TG report (September-October) 7.Finalise TG report and work with CSC on integration, findings to recommendations and overall study report (Q4, into Q1)

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group Sub-Group – Resource Endowment – Mission definition (1 st draft) Define the resource base as the technically recoverable oil and gas in the US and Canada Categorise the resource base in terms of reserves, discovered, yet to find, conventional, unconventional etc. Describe the history of resource assessments over time and explain how and why they can change Compare remaining recoverable resources with production to date Outline hierarchy of cost, technical requirements, remoteness or other special conditions, which may influence the order of development Refer to recent resource assessment studies, from all available US and Canadian sources (government, private sector, academic…) Produce comprehensive topic paper covering these issues

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group Sub-Group – Data and Study analysis – Mission definition (1 st draft) Inventory available recent studies (~ last 3 years) on US and Canadian oil and gas supply Document forecasts, their assumptions and the main drivers of difference Establish a credible range of outlooks for NA oil and gas production and highlight the factors which could lead to production at the high or low end of that range Identify the key uncertainties in the outlooks and propose ways of reducing the uncertainty, either through further research or through specific policy or industry actions Provide supply data to the demand TG and the Fuels study, to calibrate supply potential with market needs Produce comprehensive topic paper covering these issues

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group Sub-Groups – (Components of oil and gas supply) * – Mission definition (1 st draft) Describe the resource, production history and development status of the areas covered by the sub group Describe any recent studies on the potential supply outlook for the component of supply covered by the sub-group Refer to any regulatory, access, infrastructure or environmental challenges associated with resource development for the component covered by the sub group Analyse the main drivers which would either facilitate or constrain development of resources for the component covered by the subgroup Produce comprehensive topic paper covering these issues * Onshore gas, onshore oil and EOR, Arctic, offshore oil and gas, unconventional oil

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group Sub-Groups – (Infrastructure) * – Mission definition (1 st draft) Describe current (oil/gas) infrastructure in terms of capacities, supply regions and markets served, indicative utilisation Assess need for expanded infrastructure to serve new supply sources or growth of existing supply sources How could appropriate levels of infrastucture development be facilitated? Are there any significant barriers to new oil and gas infrastructure and how could they be alleviated? Produce comprehensive topic paper covering these issues * Gas infrastructure, crude oil pipelines

NPC Study on Prudent Development of North American Oil and Gas Resources Resources and Supply Task Group 1 st Task Group meeting First telcon meeting took place Tuesday March 30 th Attended by TG leads, sub-group leads, government reps & NPC Items discussed Anti-trust Introductions TG roster status Comments on draft integrated study plan Sub-group resourcing status TG meeting schedule and logistics