EXHIBIT 1
SUPPLEMENTARY OIL & GAS INFORMATION
(UNAUDITED)
This supplementary crude oil and natural gas information is provided in
accordance with the United States FAS 69, "Disclosures about Oil and Gas
Producing Activities", and where applicable is reconciled to the US GAAP
financial information.
NET PROVED CRUDE OIL AND NATURAL GAS RESERVES
The Company retains qualified independent reserves evaluators to evaluate the
Company's proved crude oil and natural gas reserves. For the years ended
December 31, 2007, 2006, 2005 and 2004 the reports by Sproule Associates Limited
and Ryder Scott Company covered 100% of the Company's conventional reserves.
Proved crude oil and natural gas reserves are the estimated quantities of crude
oil, natural gas and natural gas liquids that geological and engineering data
demonstrate with reasonable certainty to be recoverable in future years from
known reservoirs under existing economic and operating conditions. Proved
developed reserves are reserves that can be expected to be recovered from
existing wells with existing equipment and operating methods.
Estimates of crude oil and natural gas reserves are subject to uncertainty and
will change as additional information regarding producing fields and technology
becomes available and as future economic and operating conditions change.
The following table summarizes the Company's proved and proved developed
conventional crude oil and natural gas reserves, net of royalties, as at
December 31, 2007, 2006, 2005 and 2004:
North North Offshore
CRUDE OIL AND NGLS (mmbbl) America Sea West Africa Total
===============================================================================================
Net proved reserves
Reserves, December 31, 2004 648 303 115 1,066
Extensions and discoveries 98 - - 98
Improved recovery 3 3 2 8
Purchases of reserves in place - - 15 15
Sales of reserves in place (3) - - (3)
Production (70) (25) (8) (103)
Revisions of prior estimates 18 9 10 37
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Reserves, December 31, 2005 694 290 134 1,118
Extensions and discoveries 53 3 - 56
Improved recovery 190 26 - 216
Purchases of reserves in place 26 - - 26
Sales of reserves in place - - - -
Production (75) (22) (13) (110)
Revisions of prior estimates (1) 2 9 10
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Reserves, December 31, 2006 887 299 130 1,316
Extensions and discoveries 30 - - 30
Improved recovery 13 6 - 19
Purchases of reserves in place 1 - - 1
Sales of reserves in place - (3) - (3)
Production (77) (20) (10) (107)
Revisions of prior estimates 66 28 8 102
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RESERVES, DECEMBER 31, 2007 920 310 128 1,358
Net proved developed reserves
December 31, 2004 367 218 20 605
December 31, 2005 402 214 80 696
December 31, 2006 420 214 63 697
DECEMBER 31, 2007 426 240 70 736
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North North Offshore
NATURAL GAS (bcf) America Sea West Africa Total
==============================================================================================
Net proved reserves
Reserves, December 31, 2004 2,591 27 72 2,690
Extensions and discoveries 506 - - 506
Improved recovery 30 - - 30
Purchases of reserves in place 6 - - 6
Sales of reserves in place (23) - - (23)
Production (411) (7) (1) (419)
Revisions of prior estimates 42 9 1 52
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Reserves, December 31, 2005 2,741 29 72 2,842
Extensions and discoveries 250 - - 250
Improved recovery 74 - - 74
Purchases of reserves in place 1,111 - - 1,111
Sales of reserves in place (1) - - (1)
Production (433) (5) (3) (441)
Revisions of prior estimates (37) 13 (13) (37)
- -----------------------------------------------------------------------------------------------
Reserves, December 31, 2006 3,705 37 56 3,798
Extensions and discoveries 134 - - 134
Improved recovery 132 3 - 135
Purchases of reserves in place 12 - - 12
Sales of reserves in place - - - -
Production (503) (5) (4) (512)
Revisions of prior estimates 41 46 12 99
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RESERVES, DECEMBER 31, 2007 3,521 81 64 3,666
===============================================================================================
Net proved developed reserves
December 31, 2004 2,213 12 5 2,230
December 31, 2005 2,300 16 10 2,326
December 31, 2006 2,934 17 12 2,963
DECEMBER 31, 2007 2,731 58 53 2,842
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CAPITALIZED COSTS RELATED TO CRUDE OIL AND NATURAL GAS ACTIVITIES
2007
- ---------------------------------------------------------------------------------------------------------------
(millions of Canadian dollars) NORTH NORTH OFFSHORE TOTAL
AMERICA SEA WEST AFRICA OTHER
===============================================================================================================
Proved properties $ 32,061 $ 3,164 $ 1,695 $ 14 $ 36,934
Unproved properties 2,259 10 138 25 2,432
34,320 3,174 1,833 39 39,366
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Less: accumulated depletion
and depreciation (12,213) (1,446) (645) (14) (14,318)
Net capitalized costs $ 22,107 $ 1,728 $ 1,188 $ 25 $ 25,048
===============================================================================================================
2006
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(millions of Canadian dollars) North North Offshore Total
America Sea West Africa Other
===============================================================================================================
Proved properties $ 29,596 $ 3,346 $ 1,601 $ 14 $ 34,557
Unproved properties 2,244 24 84 24 2,376
31,840 3,370 1,685 38 36,933
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Less: accumulated depletion
and depreciation (9,878) (1,341) (481) (14) (11,714)
- ---------------------------------------------------------------------------------------------------------------
Net capitalized costs $ 21,962 $ 2,029 $ 1,204 $ 24 $ 25,219
===============================================================================================================
2005
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(millions of Canadian dollars) North North Offshore Total
America Sea West Africa Other
===============================================================================================================
Proved properties $ 20,886 $ 2,675 $ 1,365 $ 14 $ 24,940
Unproved properties 1,372 28 182 13 1,595
22,258 2,703 1,547 27 26,535
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Less: accumulated depletion
and depreciation (7,993) (1,022) (294) (14) (9,323)
- ---------------------------------------------------------------------------------------------------------------
Net capitalized costs $ 14,265 $ 1,681 $ 1,253 $ 13 $ 17,212
===============================================================================================================
COSTS INCURRED IN CRUDE OIL AND NATURAL GAS ACTIVITIES
2007
- ---------------------------------------------------------------------------------------------------------------
(millions of Canadian dollars) NORTH NORTH OFFSHORE TOTAL
AMERICA SEA WEST AFRICA OTHER
===============================================================================================================
PROPERTY ACQUISITIONS
Proved $ 55 $ (38) $ - $ - $ 17
Unproved 13 1 - - 14
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Exploration 239 19 - 1 259
Development 2,173 380 148 - 2,701
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Costs incurred $ 2,480 $ 362 $ 148 $ 1 $ 2,991
===============================================================================================================
2006
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(millions of Canadian dollars) North North Offshore Total
America Sea West Africa Other
===============================================================================================================
PROPERTY ACQUISITIONS
Proved $ 5,627 $ - $ 1 $ - $ 5,628
Unproved 910 - - - 910
Exploration 238 4 1 11 254
Development 2,807 628 133 - 3,568
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Costs incurred $ 9,582 $ 632 $ 135 $ 11 $ 10,360
===============================================================================================================
2005
- ---------------------------------------------------------------------------------------------------------------
(millions of Canadian dollars) North North Offshore Total
America Sea West Africa Other
===============================================================================================================
PROPERTY ACQUISITIONS
Proved $ (448) $ (3) $ 63 $ - $ (388)
Unproved 210 - (52) - 158
Exploration 360 22 16 5 403
Development 2,386 232 439 - 3,057
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Costs incurred $ 2,508 $ 251 $ 466 $ 5 $ 3,230
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RESULTS OF OPERATIONS FROM CRUDE OIL AND NATURAL GAS PRODUCING ACTIVITIES
The Company's results of operations from crude oil and natural gas producing
activities for the years ended December 31, 2007, 2006 and 2005 are summarized
in the following tables:
2007
- ---------------------------------------------------------------------------------------------------------
(millions of Canadian dollars) NORTH NORTH OFFSHORE TOTAL
AMERICA SEA WEST AFRICA
=========================================================================================================
Crude oil and natural gas revenue, net of $ 7,441 $ 1,522 $ 709 $ 9,672
royalties and blending costs
Production (1,642) (432) (94) (2,168)
Transportation (335) (16) (1) (352)
Depletion, depreciation and amortization (2,359) (340) (165) (2,864)
Asset retirement obligation accretion (38) (30) (2) (70)
Petroleum revenue tax - (141) - (141)
Income tax (997) (282) (121) (1,400)
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Results of operations $ 2,070 $ 281 $ 326 $ 2,677
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2006
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(millions of Canadian dollars) North North Offshore Total
America Sea West Africa
======================================================================================================
Crude oil and natural gas revenue, net of $ 5,707 $ 1,310 $ 911 $ 7,928
royalties and blending costs
Production (1,436) (390) (106) (1,932)
Transportation (326) (15) (1) (342)
Depletion, depreciation and amortization (1,894) (297) (189) (2,380)
Asset retirement obligation accretion (35) (31) (2) (68)
Petroleum revenue tax - (234) - (234)
Income tax (706) (172) (172) (1,050)
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Results of operations $ 1,310 $ 171 $ 441 $ 1,922
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2005
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(millions of Canadian dollars) North North Offshore Total
America Sea West Africa
======================================================================================================
Crude oil and natural gas revenue, net of $ 5,727 $ 1,499 $ 472 $ 7,698
royalties and blending costs
Production (1,211) (379) (53) (1,643)
Transportation (287) (20) - (307)
Depletion, depreciation and amortization (1,588) (306) (104) (1,998)
Asset retirement obligation accretion (34) (34) (1) (69)
Petroleum revenue tax - (172) - (172)
Income tax (1,007) (235) (110) (1,352)
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Results of operations $ 1,600 $ 353 $ 204 $ 2,157
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STANDARDIZED MEASURE OF DISCOUNTED FUTURE NET CASH FLOWS FROM
PROVED CRUDE OIL AND NATURAL GAS RESERVES AND CHANGES THEREIN
The following standardized measure of discounted future net cash flows from
proved crude oil and natural gas reserves has been computed using year-end sales
prices and costs and year-end statutory income tax rates. A discount factor of
10% has been applied in determining the standardized measure of discounted
future net cash flows. The Company does not believe that the standardized
measure of discounted future net cash flows will be representative of actual
future net cash flows and should not be considered to represent the fair value
of the crude oil and natural gas properties. Actual net cash flows will differ
from the presented estimated future net cash flows due to several factors
including:
o Future production will include production not only from proved properties,
but may also include production from probable and possible reserves;
o Future production of crude oil and natural gas from proved properties will
differ from reserves estimated;
o Future production rates will vary from those estimated;
o Future rather than year-end sales prices and costs will apply;
o Economic factors such as interest rates, income tax rates, regulatory and
fiscal environments and operating conditions will change;
o Future estimated income taxes do not take into account the effects of
future exploration expenditures; and
o Future development and asset retirement obligations will differ from those
estimated.
Future net revenues, development, production and restoration costs have been
based upon the estimates referred to above. The following tables summarize the
Company's future net cash flows relating to proved crude oil and natural gas
reserves based on the standardized measure as prescribed in FAS 69:
2007
- ----------------------------------------------------------------------------------------------------------------
(millions of Canadian dollars) NORTH NORTH OFFSHORE TOTAL
AMERICA SEA WEST AFRICA
================================================================================================================
Future cash inflows $ 71,069 $ 30,269 $ 9,921 $ 111,259
Future production costs (23,729) (9,316) (2,419) (35,464)
Future development and asset retirement
obligations (7,938) (4,021) (621) (12,580)
Future income taxes (9,508) (11,376) (1,978) (22,862)
- ----------------------------------------------------------------------------------------------------------------
Future net cash flows 29,894 5,556 4,903 40,353
10% annual discount for timing of future
cash flows (13,952) (2,176) (2,505) (18,633)
- ----------------------------------------------------------------------------------------------------------------
Standardized measure of future net cash flows $ 15,942 $ 3,380 $ 2,398 $ 21,720
================================================================================================================
2006
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(millions of Canadian dollars) North North Offshore Total
America Sea West Africa
================================================================================================================
Future cash inflows $ 63,368 $ 20,815 $ 7,779 $ 91,962
Future production costs (21,634) (8,077) (2,517) (32,228)
Future development and asset retirement
obligations (7,029) (4,348) (824) (12,201)
Future income taxes (9,118) (5,623) (1,372) (16,113)
- ----------------------------------------------------------------------------------------------------------------
Future net cash flows 25,587 2,767 3,066 31,420
10% annual discount for timing of future
cash flows (11,214) (956) (1,258) (13,428)
- ----------------------------------------------------------------------------------------------------------------
Standardized measure of future net cash flows $ 14,373 $ 1,811 $ 1,808 $ 17,992
================================================================================================================
2005
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(millions of Canadian dollars) North North Offshore Total
America Sea West Africa
================================================================================================================
Future cash inflows $ 52,266 $ 19,961 $ 8,515 $ 80,742
Future production costs (17,310) (6,130) (1,803) (25,243)
Future development and asset retirement
obligations (3,916) (3,099) (1,032) (8,047)
Future income taxes (10,272) (6,631) (2,092) (18,995)
- ----------------------------------------------------------------------------------------------------------------
Future net cash flows 20,768 4,101 3,588 28,457
10% annual discount for timing of future
cash flows (7,793) (1,144) (1,068) (10,005)
- ----------------------------------------------------------------------------------------------------------------
Standardized measure of future net cash flows $ 12,975 $ 2,957 $ 2,520 $ 18,452
================================================================================================================
The principal sources of change in the standardized measure of discounted future
net cash flows are summarized in the following table:
(millions of Canadian dollars) 2007 2006 2005
- ---------------------------------------------------------------------------------------------------------------
Sales of crude oil and natural gas produced,
net of $ (7,150) $ (5,635) $ (5,785)
production costs
Net changes in sales prices and production costs 7,412 (2,420) 11,056
Extensions, discoveries and improved recovery 1,429 4,769 3,596
Changes in estimated future development costs (169) (1,885) (971)
Purchases of proved reserves in place 39 2,406 469
Sales of proved reserves in place (103) (2) (130)
Revisions of previous reserve estimates 2,380 81 961
Accretion of discount 2,760 3,112 1,812
Changes in production timing and other 508 (2,156) 1,414
Net change in income taxes (3,378) 1,270 (4,458)
- ---------------------------------------------------------------------------------------------------------------
Net change 3,728 (460) 7,964
Balance - beginning of year 17,992 18,452 10,488
- ---------------------------------------------------------------------------------------------------------------
Balance - end of year $ 21,720 $ 17,992 $ 18,452
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