Oil & Money Conference 13-14 November 2012 1

Impacts of Unconventional Oil & Gas on IOC-NOC Relationships

Nasser Al-JaidahCEO

Qatar Petroleum International (QPI)

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A Well-Established Bottom Line

Global gas demand growth outlook is strong – some estimate ~ 40% growth by 2025

Developing country population growth and energy intensity leading this growth

New resources needed, and IOC/NOC in unconventional is a mutually beneficial source

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Shift To Unconventional ResourcesNOCs

� Increased share of global hydrocarbon portfolio

� Historically produced from upper portion of resource triangle with less complexity and lower cost

� Need to move to more complex resources like unconventional over time, but limited NOC experience

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Expertise of IOCs, Independents in Unconventional Oil & Gas

International oil companies (IOCs) and independents have experience in finding and exploiting unconventional resources

This IOC experience positions them well for cooperation with NOCs in unconventional oil, with mutual benefit, including continuing their historical role as technology transfer leaders

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Independents and Service Companies early entrants in unconventional gas� Tight gas, shale gas, and coal-bed methane

These Service Companies helped to develop technologies needed to exploit unconventional (eg. Drilling, fracturing techniques)

IOCs have a decade or more of investment experience in tight/shale gas, esp in the US

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What NOCs OfferNOCs:

� Financial capacity required for unconventional

� Infrastructure (eg shipping, delivery point access) needed to optimize returns and growth

� Market access to optimize delivery sources and demand points for consumer and NOC/IOC benefit - arbitrage

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Competitive Advantages of IOCsProject and risk management, in addition to technology and know how

Application of disciplined approach to optimize design, procurement and construction – spend for the right reasons at the right time

Strong ability to define and match new products to meet demands of specific markets

IOC/NOC Cooperation in Unconventional – Mutual Benefits

How do IOCs benefit?Access to low cost capitalAccess to low cost infrastructure and synergiesEnhanced market access

How do NOCs benefit?

Access to technologyAccess to IOC learning curve effectsValue generation through optional supply sources and growth

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Ultimately, markets benefit through effective and economically sustainable sources of supply to meet global demand.

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Unconventional – NOC OpportunityThe prospect of new large scale resource may be perceived as a potential threat� Combine effective partnership with IOCs, and disciplined investment

turns unconventional into an NOC opportunity

Qatar uniquely positioned to contribute and participate in this IOC/NOC partnership in unconventional oil and gas� Capital, shipping/infrastructure, market arbitrage, and historical

partnership/commitment focus

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To Sum upUnconventional resource development will play an increasing role in meeting global energy demandNOCs should embrace the challenges and opportunities associated with the exploitation of promising unconventional resourcesMassive infrastructure challenge, and NOC/IOC partnership is a natural and effective method to meet this challenge

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Thank You !