Oil & Money 2015 Chair: Sadad Al-Husseini - President Husseini Energy Co. Panel: Bernard Duroc-Danner Chairman of the Board, President and Chief Executive Officer Weatherford International Helge Hove Haldorsen - 2015 President Society of Petroleum Engineers Emilio Lozoya Austin - Chief Executive Officer Pemex Ali Moshiri - President Chevron Africa and Latin America Exploration and Production Co.

1. #OM2015#OM2015
2014 aftermath – widespread challenges, long term uncertainty
 $150 billion upstream projects delayed : Rystad Energy
 46 projects totaling $200 billion shelved : Wood Mackenzie
 $ 59 Billion in Canadian projects deferred : Financial Post, Canada
 $ 60 B impairments exceed $48.5 B peak of 2008 : IHS Herold Inc.
 30 % of semis and deep water drill ships idled : Bloomberg
 US oil rigs down from 1600 to 652 (- 60%) : Baker Hughes Int’l
 176,000 oilfield layoffs as of mid-2015 : Swift Worldwide Resources

2. #OM2015
 Accelerating growth in demand : 1.5 + Mbd/year
 Increasing requirement for decline replacement : 4 + Mbd/year
 Limited sustainable spare capacity : 2 Mbd
 2013/2014 MSDW & BCG full cycle cost for 75 traded companies :
• Full cycle cash cost: $ 48.5/barrel
• Cost of capital: $ 14.4/barrel
• Average total cost: $ 62.9/barrel
Reality check - is the “new normal” sustainable ?

3. #OM2015
 How deeply have low oil prices transformed the landscape?
 Will dramatic cost cutting affect operational flexibility and reliability?
 Are there sufficient investments to meet growing demand?
 What is the economic outlook for frontier development costs?
 How will the write down of reserves affect the industry?
 Can the industry retain its key talent and professionals?
2016 - seeking profitability from leadership perspective: