Update of the Beaufort Sea Exploration Joint Venture

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1 Beaufort Sea Exploration Program EL 476 and EL 477 Joint Venture Update of the Beaufort Sea Exploration Joint Venture Presented by: Sherry Becker Presented to: NWT Chamber of Commerce AGM April 3, 2013

2 Objectives Objectives for the presentation: Provide a summary of the activities in the Beaufort Sea Exploration Joint Venture (JV) over the past 12 months Outline some of the challenges ahead that must be addressed for the program to proceed Outline Imperial s key principles and strategies for employment and business opportunities 2

3 Outline Agenda: Background Recent activities Notional exploration well schedule Key focus areas Business and employment key principles and strategy Business and employment opportunities Questions and discussion 3

DMG AJ 00016 July 23 12 Beaufort Sea Exploration Program Joint Venture 2007; EL 446 Ajurak (now EL 476)

the Ajurak area, to identify potential geological prospects and drilling locations 2009; BP conducted a

reached among Imperial, ExxonMobil and BP, which provides for a cross-conveyance of EL 476 and EL 477

ArcticNet research collaboration to collect baseline data Imperial is the designated operator of the

of the MV Western Patriot Taglu Tuktoyaktuk Niglintgak 135º W Parsons Lake Photo courtesy of

4 DMG AJ July Beaufort Sea Exploration Program Joint Venture 2007; EL 446 Ajurak (now EL 476) was issued to Imperial (50%) and ExxonMobil (50%) 2008; Imperial conducted a 3-D seismic program over the Ajurak area, to identify potential geological prospects and drilling locations 2009; BP conducted a 3-D seismic program over the area of EL 449 Pokak (now EL 477) 2010; a Joint Operating Agreement was reached among Imperial, ExxonMobil and BP, which provides for a cross-conveyance of EL 476 and EL 477 (ownership: Imperial 25%, ExxonMobil 25% and BP 50%) ; 3 years of participation in the ArcticNet research collaboration to collect baseline data Imperial is the designated operator of the joint venture EL 476 (Ajurak) EL 477 (Pokak) km N 70º N Marine mammal observer on the helipad of the MV Western Patriot Taglu Tuktoyaktuk Niglintgak 135º W Parsons Lake Photo courtesy of WesternGeco Consultation in Inuvik for the 3-D seismic program MV Western Patriot Seismic vessel used in 2008 program over Ajurak 4

AANDC Photo courtesy of the National Energy Board Recent Activities December 2011, the NEB published the findings of the AODR The NEB reaffirmed its commitment to goal-based regulation July 2012

regulatory guidelines and the licence extensions Key operational and financial decisions tied to the stages of the regulatory process Participants in the AODR Inuvik Roundtable, September 2011 The

5 AANDC Photo courtesy of the National Energy Board Recent Activities December 2011, the NEB published the findings of the AODR The NEB reaffirmed its commitment to goal-based regulation July 2012 Minister for AANDC issued new replacement exploration licences (EL 476 and EL 477) Imperial is currently evaluating the feasibility of the Beaufort opportunities in light of the AODR findings, regulatory guidelines and the licence extensions Key operational and financial decisions tied to the stages of the regulatory process Participants in the AODR Inuvik Roundtable, September 2011 The AODR report, issued in December 2011 Exploration Licence (EL) tenure: Ajurak: EL 446 (cancelled) EL 476 (new EL) Pokak: EL 449 (cancelled) EL 477 (new EL) July September Regulatory process: Update of the Beaufort Sea Exploration Joint Advance Venture to NEB the ADM Executive Committee Gatineau, P.Q., November 6, 2012 Pre-regulatory activities SSRW Ruling AODR 5

6 Example of a Typical Schedule 6

Image courtesy of Concordia Maritime AB Key Focus Areas Economic viability: capital cost of exploration and development transportation systems recoverable and retained resources; SDL extent and

Responsibility Requirements Framework Regulatory process: uncertainty regarding scope, duration and cost resolution of equivalency to SSRW capability issue Canadian Environmental Assessment Agency

7 Image courtesy of Concordia Maritime AB Key Focus Areas Economic viability: capital cost of exploration and development transportation systems recoverable and retained resources; SDL extent and follow up locations Financial commitment: advance commitments prior to regulatory approvals drilling rig construction, off season utilization support vessels / shore-based facilities Financial Responsibility Requirements Framework Regulatory process: uncertainty regarding scope, duration and cost resolution of equivalency to SSRW capability issue Canadian Environmental Assessment Agency (CEAA) possible requirement for environmental review of offshore exploratory drilling Conceptual illustration of ice management using several icebreakers spill response capability options post approval external interventions to the regulatory process and validity of authorizations Typical ice-strengthened fuel tanker 7

8 Business and Employment Key Principles and Strategy Key Principles In executing the exploration program, Imperial will seek to: support the development of transferable skills Respect local Inuvialuit culture and harvesting activities Develop creative opportunities for local businesses and employment that meet the unique needs of the region and the people Provide sufficient lead time for necessary education, training and experience to allow people and companies the opportunities to compete for work associated with the program Strategy Imperial s strategies for to support participation in program activities: supporting existing and new Inuvialuit businesses, to the extent possible supporting local recruitment for employment supporting initiatives to increase opportunities for education and training in the ISR through regular interactions with educational institutions, such as working with Aurora College and through secondary school programs providing a transparent and fair procurement and contract award process Review of the Beaufort Sea Exploration Joint Venture EL 476 and EL 477 Yukon Energy, Mines and Resources March 19,

9 Workshop Business, Training and Employment Imperial considers hosting a business, training and employment workshop. This workshop could describe Imperial s: business and employment strategy for local and northern content support for existing Inuvialuit and northern businesses and the development of new business opportunities plans for recruitment, education and development programs to facilitate employment of qualified Inuvialuit people plans for providing a transparent and fair procurement and contract award process commitment to communicating opportunities overview of the prospective business and employment opportunities that might be available if the drilling program proceeds, potentially including: marine support vessels shore-based warehouse and dock services camp services aviation services fuel supply oil spill response capability a process for evaluating applicants based on their background, experience and training, including pre-employment screening Review of the Beaufort Sea Exploration Joint Venture EL 476 and EL 477 Yukon Energy, Mines and Resources March 19,

10 Summary Forward Plans Complete evaluation, prepare regulatory submissions and assess next steps Questions and discussion 10

11 For Further Information Where can you get a copy of the Preliminary Information Package (PIP)? visit Imperial Oil s homepage: search Beaufort Exploration to download a copy from: Sherry Becker Beaufort Opportunity Manager Imperial Oil Resources Ventures Limited 237 Fourth Avenue S.W. P.O. Box 2480, Station M Calgary, Alberta T2P 3M9 (403) sherry.l.becker@exxonmobil.com 11

APPENDIX A LIST OF MAPS. Inuvialuit Settlement Region: Private Inuvialuit Lands and Crown Lands...Appendix A1 Source: Joint Secretariat - GIS

APPENDIX A LIST OF MAPS. Inuvialuit Settlement Region: Private Inuvialuit Lands and Crown Lands...Appendix A1 Source: Joint Secretariat - GIS APPENDIX A LIST OF MAPS MAP 1 MAP 2 MAP 3 MAP 4 MAP 5 MAP 6 MAP 7 MAP 8 MAP 9 Inuvialuit Settlement Region: Private Inuvialuit Lands and Crown Lands...Appendix A1 Source: Joint Secretariat - GIS Protected