1

Norway BU presentation to investors

bp

2

Growing from a firm foundation

1998 1999 2000 2001

Marginal operations

Moderate positionand influence inNorway

Gained scale

Cut costs

Getting the basicsright

Installed fiber opticcable

Step change licenseawards

Royalty relief

Sanction Tambar

Sanctioned projects-Valhall drilling- Ula drilling- Gyda drilling- Valhall WIP

Initiated power cablestudy

Positioned for gas

Purchased Ulapipe

Positioned for environmentalchanges

Confirming Skarv

Driiling Havsule

Sanction Valhall Flankproject

3

Focus on politics =suboptimalsolutions?

= cost overruns

Too much Statoil = SDFI

Huge t-o-p gas deals by Statoil,

= later GFU

1986 price fall = tax cut

= new investments

Majors complain, .....but remain

A changing business environment

MARKETOPPORTUNITIES

KNOCKS

Little awarenessin Norway

”Let the foreigners

do this”

Oklahoma pioneers

Industry boomby private enterprisebut then....

State takes control through Statoil,

NPD, regulati-ons and the

taxman

Send inthe state

1960’s 1970’s 1980’s 1990’s 2000’s

Politics before value?

New areas opens=competition for

capital and people

Improved t&c

Norw. industry sees need to

compete abroad

BP Statoil alliancewins strong positions

Gov. accpets EU liberalisation

of licensing and purchasing

Commercial thinking

Further t&c improvements

royalty, CO2 tax

Parliament cutsred tape

SDFI sale, Statoil privatisation

Gov. accept EUgas liberalisation

GFU will go

Cuts Statoil dom-inance in gas

transport

NEW MARKET OPPORTUNITIES

Global positioning

Lev

el o

f lib

eral

bu

sin

ess

envi

ron

men

t

Time

4

Strategy: Growth and profitability

Build on merger synergies

Maximise base value and recovery

Monetise discoveries

Become a leading player in Norwegian gas

5

BP global upstream production

0

2000

3000

4000

5000

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05

7%

5.5%

Productionmboed

Base Like for like adjustmentNew projects

Source: BP data

6

Valhall – growing a mature asset

VALHALL RESERVES GROWTH

0

50

100

150

200

250

300

350

Ult

ima

te r

es

erv

es

(m

ms

tb)

BP Net Reserves (BP - 28.1%)

67+50

+35

+10 +30+75

267

Ori

gin

al r

eser

ves

Ho

rizo

nta

l w

ells S

eism

ic

Ad

van

ced

com

ple

tio

ns

ER

D(D

rill

ing

) IOR

Cu

rren

tre

serv

es

0

5

10

15

20

25

30

35

40

45

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

mb

oe

d

Base Water injection Flank development

VALHALL PRODUCTION PROFILE

7

New projects

BPN00416.fh8

2/11/3

8/107/12PL019C

PL019C

PL019A

PL019B

PL019B

PL019C

PL065

PL065

GYDA

To EKOFISK

PL 065 (Tambar)BP Amoco: 55%SDFI (State): 30%

15%

ULATambar - Ula: 16kmTambar - Gyda: 11.5kmTambar - Ekofisk: 50km

Oil exportGas export

Multiphase

TAMBAR

0

10

20

30

40

5060

70

80

90

100

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

mb

oed

Base Tambar Ula wag

PRODUCTION PROFILE

Shell

8

Gas demand growth

74

104

1999 2010

CAGR = 3.2%

Americas

44

68

CAGR = 4.1%

Asia & Middle East

1999 2010

Source:DRI, 4th quarter 1999

Bcf/d

3852

CAGR = 2.8%

Europe

1999 2010

0

2

4

6

8

10

12

14

UK

Germ

any

France

Nether

lands

Belgiu

m

Poland

Austria

Czech

Hungary

bcf/d

20002010

9

UK supply-demand

0

25

50

75

100

125

150

175

1990 1995 2000 2005 2010 2015 2020

Undiscovered

Discoveries

Existing fields

High demandplus exports

Low demandplus exports

(BCM/year)

Source: Wood Mackenzie

10

Shell2,8 %

Statoil9,5 %

TFE3,9 %

Others2,5 %

YTF42,6 %

SDFI27,3 %

BP1,2 %

Norsk Hydro6,9 %ExxonMobil

2,7 % Phillips0,5 %

Source: WoodMac and NPD

11% of YTF is licensed, whereof BPholds 18%

Norwegian gas reservesTotal: 200 Tcf

11

BP – Positioned to grow in gas

Exploration

Discoveries

Production

65°

PL 212

PL 216

PL 093PL 158

PL 208 PL 250

2°

66°

64°

PL 251

PL 254

PL 260

PL 262PL 261

PL 200

PL 210

PL 217 PL 218

Draugen

OrmenLange

Skarv&Snadd

Luva

63°

4°

6° 8°

Kristiansund

Trondheim

10°

Non BP acreage

12

Skarv development

400m

Development cost NOK 11-13 billion

FPSO

48%

Subsea

26%

Drilling

26%

• Plan for development and operation 1Q/02

• First production 4Q/04

13

World-class potential 10- 15+ TCF

Currently determining most optimal development plan

Additional 1 or 2 appraisal wells required

Field will likely be developed with Spar or Semi

Production start-up in 2007 +/- 1 year

BP supports early positioning of OL in gas market

Forecast plateau rate of 15 BCMA

BP net interest of circa 10% anticipated

Ormen Lange

14

Summary

Used the opportunity of the merger to reshape our business

– Profitability enhanced

– Foundation for growth

We are growing

Positioned to seize the opportunities coming from a changing Norwegian business environment

En route to being a leading gas player in Norway