1. Arctic Gas Symposium American Conference Institute November 18-19, 2002 The Renaissance Houston Hotel Houston, Texas Houston, Texas

2. Arctic Gas Symposium Canadian Oilfield Services Perspective Discussion: Canadian Drilling Activity Forecast Canadian Drilling Activity Forecast Canadian Arctic Pipeline Canadian Arctic Pipeline Kyoto Protocol Kyoto Protocol

3. Canadian Drilling Activity Forecast

4. 2002 Forecast

5. Arctic Gas Symposium Canadian Oilfield Services Perspective Document Highlights: Document Highlights:  Total Meters Drilled by Area, By Status (Gas, Oil, etc.)  Average Meters Drilled per Well by Area  Break-Out: Directional, Horizontal, Vertical  Break-Out: Developmental, Exploratory, Re-entry  Average License to Spud Days per Area  Average Spud to Rig Release Days per Area  Top 20 Operators by Area  License issued by Target Depth per Area

6. Arctic Gas Symposium Canadian Oilfield Services Perspective

7. 2002 Commodity Price Assumptions: Avg. Gas price:CDN (AECO) $4.00/Mcf Avg. Gas price:CDN (AECO) $4.00/Mcf Avg. Oil price:US (WTI) $26.00/barrel Avg. Oil price:US (WTI) $26.00/barrel Wells Drilled (Rig released):15,100 Arctic Gas Symposium Canadian Oilfield Services Perspective

8. PSAC 2002 Rig Release Forecast Breakdown: 2002 October 2002 October Update Update AB: 11,210 AB: 11,210 BC: 635 BC: 635 SK: 3,050 SK: 3,050 MB: 85 MB: 85 North 60 12 North 60 12 Other: 108 Other: 108 Total: 15,100 Total: 15,100

9. Arctic Gas Symposium Canadian Oilfield Services Perspective Well Type Breakdown: 2002e Gas61.6% Oil28.1% Other10.3%

10. Capital Expenditures (C$billions): 2002e Drill & Complete Capital Expenditures $6.0 Arctic Gas Symposium Canadian Oilfield Services Perspective

11. 2003 Forecast

12. Arctic Gas Symposium Canadian Oilfield Services Perspective 2003 Highlights: Higher well count Higher well count  Strong commodity prices  Increased activity in Foothills and NEBC  Strong shallow gas drilling

13. 2003 Commodity Price Assumptions: Avg. Gas price:CDN (AECO) $4.75/Mcf Avg. Gas price:CDN (AECO) $4.75/Mcf Avg. Oil price:US (WTI) $24.25/barrel Avg. Oil price:US (WTI) $24.25/barrel Wells Drilled (Rig released):16,500 Arctic Gas Symposium Canadian Oilfield Services Perspective

14. Year to Year Comparisons (CND $Billions): Drill & Complete Drill & Complete YearCapital Expenditures 2003e $7.0 2002e $6.0 2001e $9.0 2000e $8.0 Source: PSAC, FirstEnergy, ARC Financial

15. Arctic Gas Symposium Canadian Oilfield Services Perspective PSAC 2002/3 Rig Release Forecast Breakdown: 2002 2003 2002 2003 Forecast Forecast Forecast Forecast AB: 11,210 12,350 AB: 11,210 12,350 BC: 635 805 BC: 635 805 SK: 3,050 3,150 SK: 3,050 3,150 MB: 85 80 MB: 85 80 North 60 12 15 North 60 12 15 Other: 108 100 Other: 108 100 Total: 15,100 16,500 Total: 15,100 16,500

16. Arctic Gas Symposium Canadian Oilfield Services Perspective Well Type Breakdown: 2003e2002e Gas62.3%61.6% Oil27.3%28.1% Other10.4%10.3%

17. Canadian Arctic Pipeline

18. Arctic Gas Symposium Canadian Oilfield Services Perspective Northern Canada Conventional Crude Oil Reserves (Billion Barrels) Conventional Crude Oil Reserves (Billion Barrels)  Canada4.7  North 600.1 Gas Reserves (Tcf) Gas Reserves (Tcf)  Canada65.6  North 60 6.0 Source: CAAP, PSAC

19. Arctic Gas Symposium Canadian Oilfield Services Perspective Northern Canada Potential Potential Conventional Crude Oil Reserves (Billion barrels) Potential Conventional Crude Oil Reserves (Billion barrels)  North 602.0 Potential Gas Reserves (Tcf) Potential Gas Reserves (Tcf)  North 6060 Source: PSAC

20. Arctic Gas Symposium Canadian Oilfield Services Perspective Northern Canada Oil production since 1943, currently 25,000 bbl/day Oil production since 1943, currently 25,000 bbl/day Gas production since 1972, currently 0.15 Bcf/day Gas production since 1972, currently 0.15 Bcf/day Approximately 1,400 wells drilled to date versus 335,000 for the rest of Canada Approximately 1,400 wells drilled to date versus 335,000 for the rest of Canada Source: CAAP

21. Arctic Gas Symposium Canadian Oilfield Services Perspective Canadian Crude OilNorth 60 Canadian Crude OilNorth 60  Production – 2.2 million bbl/day 25,000 bbl/day  Exports – 1.3 million bbl/day Canadian Natural Gas Canadian Natural Gas  Production – 17.4 Bcf/day 0.15 Bcf/day  Exports – 10.6 Bcf/day Source: CAAP

22. Arctic Gas Symposium Canadian Oilfield Services Perspective Mackenzie Gas Pipeline Project Developers Project Developers  Imperial Oil  Conoco Canada  Shell Canada  Aboriginal Pipeline Group

23. Arctic Gas Symposium Canadian Oilfield Services Perspective Mackenzie Gas Pipeline Developing onshore natural gas fields in the Mackenzie Delta (6 Tcf currently) Developing onshore natural gas fields in the Mackenzie Delta (6 Tcf currently)  Taglu (3 Tcf)  Parsons Lake (1.8 Tcf)  Niglintgak (1 Tcf) Source: Imperial Oil

24. Arctic Gas Symposium Canadian Oilfield Services Perspective Mackenzie Gas Pipeline Project Costs Project Costs  C$3 Billion – pipeline construction  C$1 Billion – field development Source: Imperial Oil

25. Arctic Gas Symposium Canadian Oilfield Services Perspective Mackenzie Gas Pipeline Expected Production Rates (three existing fields) Expected Production Rates (three existing fields)  800 Mcf/day to 1.0 Bcf/day in natural gas production  10,000 bbl/day to 15,000 bbl/day in associated NGLs Source: Imperial Oil

26. Arctic Gas Symposium Canadian Oilfield Services Perspective Mackenzie Gas Pipeline Anticipated Timing Anticipated Timing  Submission of applications for regulatory approval in 2003  Production start up in 2007 to 2008 Source: Imperial Oil

27. Arctic Gas Symposium Canadian Oilfield Services Perspective Mackenzie Gas Pipeline Initial capacity of 1.2 Bcf/day Initial capacity of 1.2 Bcf/day Expandable to 1.9 Bcf/day through additional compression facilities Expandable to 1.9 Bcf/day through additional compression facilities

28. Arctic Gas Symposium Canadian Oilfield Services Perspective Nature of Northern Work Seasonal Seasonal Cyclical Cyclical Long Term Long Term Expensive Expensive

29. Arctic Gas Symposium Canadian Oilfield Services Perspective “Managing Expectations” Producers Producers Local Aboriginal communities/businesses Local Aboriginal communities/businesses Service suppliers Service suppliers Government Government

30. Arctic Gas Symposium Canadian Oilfield Services Perspective Local Communities/Business Go slow….take the time to do it right Go slow….take the time to do it right Lifestyle Lifestyle Jobs Jobs Training programs Training programs

31. Kyoto Protocol

32. Arctic Gas Symposium Canadian Oilfield Services Perspective Kyoto Protocol – Canadian Situation: Kyoto Protocol – Canadian Situation:  Target CO2 reductions – 5% below 1990  1990 CO2 emissions – 607 mega tonnes (2% world emissions) (2% world emissions)  2010 Projections - 810+ mega tonnes – (30% reduction to meet target)

33. Arctic Gas Symposium Canadian Oilfield Services Perspective Kyoto Protocol – Canadian Situation: Kyoto Protocol – Canadian Situation:  Ratification  Full-Soft  Canadian Parliament December 2002

34. Arctic Gas Symposium Canadian Oilfield Services Perspective Kyoto Protocol – Canadian Situation: Kyoto Protocol – Canadian Situation:  Ratification  Full-Soft  Canadian Parliament December 2002

35. Arctic Gas Symposium Canadian Oilfield Services Perspective “What we need to do is end the debate about ratification and begin being clear about what the measures are that we’re going to need to implement. Nobody is going to come in and seize our property or charge us a penalty if we don’t achieve the (Kyoto) targets…..” John Manley, Finance Minister November 14, 2002 Calgary Herald

36. Arctic Gas Symposium Canadian Oilfield Services Perspective Kyoto Protocol – Poll Results: Kyoto Protocol – Poll Results: Jun ’02 Nov’02 Jun ’02 Nov’02 Pro Con Pro Con Pro Con Pro Con Canada86% 14%74% 26% Ontario87% 13%75% 25% Alberta72% 28%40% 60%

37. Arctic Gas Symposium Canadian Oilfield Services Perspective Kyoto Protocol – Canadian Situation: Kyoto Protocol – Canadian Situation:  Personal Views

38. Arctic Gas Symposium American Conference Institute For further information or to subscribe to the document, please visit: WWW.PSAC.CA