1. 2002-09-16 XP06432_7 Mackenzie Gas Project Next Steps Toward a Mackenzie Valley Natural Gas Pipeline

2. Taglu - 3 TCF ­Discovered 1971 ­100% Imperial Oil Parsons Lake - 1.8 TCF ­Discovered 1972 ­75% ConocoPhillips Canada ­25% ExxonMobil Canada Niglintgak - 1 TCF ­Discovered 1973 ­100% Shell Canada Significant Discoveries - Onshore Gas Gas Pipeline Tuktoyaktuk Ikhil Parsons Lake Niglintgak Inuvik Taglu Gas Gathering System Common Facility XP06355b

3. Development Concept Overview Canadian onshore gas, three anchor fields Mackenzie Valley Pipeline Proven technology Minimize the environmental footprint Producer capacity of 800-1000 MCFD Aboriginal capacity up to 400-500 MCFD Accessible to others Utilizes ullage in existing pipelines +liquids to Enbridge +gas to TCPL

4. Feasibility Study Project Definition Design and Construction Operations gas sales engineering studies environmental field work public consultation northern benefits plans regulatory applications regulatory review process detailed design of facilities drill wells purchase goods and services construct pipeline and field facilities potential expansion + abandonment and reclamation Complete 3 - 4 years 25+ years Decision to prepare regulatory applications Decision to construct Mackenzie Gas Project - Phased Approach concurrently assess external matters assess natural gas markets assess reserves little, if any, field work

5. Project Definition Phase  Agreed on way to proceed while awaiting APG funding  Secured office space and began staffing project team with co-venturers  Broadened communications and consultation activities  opened representative offices in Fort Simpson, Norman Wells and Inuvik  Awarded engineering contract and began conceptual engineering  Initiated phased open season process with potential shippers  Continued collecting baseline environmental data  Developed Preliminary Information Package  Started development of benefits plans, access and related arrangements  Field work to study river crossings, permafrost, route refinement and granular sites

6. When Will Mackenzie Gas be Commercial? Development can only proceed when all these conditions exist Northern parties must be supportive of development, and in agreement with its benefits Outlooks for natural gas markets must be favourable Discovered onshore natural gas reserves must be large enough, and certain enough Investor economics on a “standalone” basis must be competitive with other opportunities, and sufficient for the risks involved (gas reserves, costs, gas markets) Facility plans and designs must ensure safe, reliable and environmentally responsible operations Regulatory approvals must be obtainable in a timely manner Stable and favourable fiscal terms Pipeline investment costs must be financeable