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Slide 1ESIA Tullow Oil November 2010
Tullow Oil ESIA Experience in Ghana / UgandaNovember 2010
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Slide 2ESIA Tullow Oil November 2010
The Tullow footprint
Africa Rest of the World
Europe
1 Netherlands E
2 United Kingdom EDP
1
2
3
4
5
6
7
8
9
Angola E
Congo (Brazzaville) DP
Congo (DRC) E
Cte d'Ivoire EDP
Equatorial Guinea DP
Ethiopia* E
Gabon EDP
Ghana ED
Kenya* E
South America
1 French Guiana E
2 Guyana E3 Suriname E
South Asia
1 Bangladesh EDP
2 Pakistan EDP
Liberia E
Madagascar E
Mauritania EDP
Namibia D
Senegal E
Sierra Leone E
Tanzania E
Uganda ED
10
11
12
13
14
15
16
17
Group highlights
South America
3 countries
4 licences
Europe
12,700 boepd 2 countries 28 licences 16 producing fields
Africa
37,500 boepd
17 countries*
56 licences*
18 producing fields
South Asia
5,600 boepd
2 countries 8 licences
2 producing fields
1
22
1
23 1
Key: E Exploration D Development P Production
4
10
12
14
1
23
5
7
8
1113
16
1715
6
9
* - subject to completion of farm-in deals.
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Slide 3ESIA Tullow Oil November 2010
83% global exploration success rate in 2010 YTD
French Guiana
94 of 2,494
sqkm 3D
171 km 2D
2,494 sqkm3D PSDM
171 km 2D PSDM
2,424 sqkm
3D PSDM
NetherlandsGabon 2 wells
1,512 sqkm 3D PSDM
678 km 2D PSDM
OMOC-N-1
Onal-1004
OMOC-N301
OMOC-N201
OMOC-N302
Noix de Coco-1
3,600 sqkm3D PSDM
Sierra Leone
2,307 sqkm 3D
2,307 sqkm 3D PSDM
Cte dIvoire
Guyana
1,889 sqkm
3D PSDM
Tweneboa-2
Ghana 5 wells
Dahoma-1
Mahogany-5
Owo-1
1600 sqkm 3D PSDM
600 sqkm 3D PSTM
87% success rate in 2009
77% success rate in 2008
Seismic Drilling
Acquisition
Processing
Offshore
Onshore
48 km of 2D PSDM
Pakistan 1 well
Shekhan-1
Tanzania -1 well
973 km 2D PSTM
Likonde-1
Madagascar
720 km2D PSTM
Uganda 9 wells
Kasamene-2
Kasamene-3
Kasamene-3A
Nizizi-3
Nsoga-5
124 km 2D AWD
97 of 145 km 2D
Low frequency passiveproject
221 km 2D PSTM
50 sqkm 3D PSTM
Ngiri-2
Mpyo-1
Kigogole-2
Kigogole-4
Kigogole-5
Owo-1 ST Onyina-1
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Slide 4ESIA Tullow Oil November 2010
Tullow EHS
Environmental, Health and Safety Policy- Strong EHS leadership by senior
management
- Approved by Board and signed by CEO
Clear policy statement on- Protecting people
- Environmental protection- Continual improvement
- Working with Communities
Tullow understands key EHS principlesin planning and undertaking ouroperations
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Slide 5ESIA Tullow Oil November 2010
Environmental Management
ISO 14001 certification for Environmental
Management System (EMS)
EMS is a core part of our Integrated ManagementSystem
Aligned with IFC Performance Standards and
Equator Principles
ESIA for all operations- ESIA Recommended Practice Guidelines
- Risk Management Procedure
Standards for environmental management alignedto EMS Tullow Oil Environmental Standards
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Slide 6ESIA Tullow Oil November 2010
Ghana & Uganda
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Slide 7ESIA Tullow Oil November 2010
Ghana
JUBILEE FIELD LAYOUT
J1-DInstalledTree
J2-CInstalledTree
J10-A
J14-B
J13-D
J12-DInstalled
J15-C
J11-B J8-BInstalledTree
J6-D
J7-C
InstalledTree
J4-BInstalledTree
J9-C
J5-DInstalledTree
J17-A
InstalledTree
J3-BInstalledTree
J16-B
InstalledTree
Installed 2x 12
W Prod.Flow
lines
Installed Umbilicals
(Mar2010)
Installed
10 EGIF
Rev. 5 to End of April 2010
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Slide 8ESIA Tullow Oil November 2010
Uganda
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Slide 9ESIA Tullow Oil November 2010
Uganda Development
Nzizi Gas Field development (IPP)
50 MW Power Plant planned for Hoima Region
Nzizi-3 well confirmed expected gas volumes
Kasamene Field Development
Successful Kasamene-2 & 3 appraisal wells
Results support development concept and volumes
FEED studies optimised to minimise environmental footprint
First oil end 2011
Development focused on local and regional needs
Kasamene
Nzizi
Road
IntegratedPower Project(IPP) -Nzizi
Gravel roadupgrade toHoima fortrucking
KasameneCentral
ProcessingFacility
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Slide 10ESIA Tullow Oil November 2010
Context
Both Uganda and Ghana frontier oil and gas regions- Limited exposure to development of this scale
- Emerging areas of resource conflict and access due to population growth and arearesettlement
Politically stable
High expectations of what the oil and gas industry will do for all areas ofdevelopment, not only in relation to oil and gas production
Two completely different operational areas but with very similar underlyingchallenges..
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Slide 11ESIA Tullow Oil November 2010
Regulatory Elements
The regulatory frameworks in both regions is not oil and gas specific- ESIA regulations are in place and applied however they do not cater for specific oil
and gas issues, mainly mining sector influence- Wider pollution control standards, i.e. effluent standards, air emissions etc are not
clearly defined nor applicable to industry in many cases
Regulatory bodies are still developing their understanding of industry issues- To date a lot of misconception or misunderstanding- Ranges from no mechanism to manage to world class without supporting
infrastructure to allow the later to be realistic- Oil and Gas Policy under review in Uganda current draft prohibits venting /flaring
Challenge is to present way forward without impeding the autonomy ofregulator i.e. IFC Performance Standards
Lack of clarity over key institutions roles in decision making
Development and Exploration timelines are aggressive and this may lead topressure on regulators who are usually underfunded and under resourced tocope with the additional load
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Slide 12ESIA Tullow Oil November 2010
Sound Base for ESIA
Baseline information- Although not such an issue in exploration process as development matures so
does the required for continual and robust baseline information
- Requires early recognition of requirements in order to allow information to bemeaningful. Lessons from Ghana implemented in Uganda
- In areas with no baseline how much is required to make truly informed decisions
- Clarity on roles within an SEA framework - in Uganda this has focused mainly onoil and gas sector but not broader resource conflict issues, i.e. tourism, fisheries
- Information may exist but will be held under different institutions who are notalways aligned
The SEA concept is sound however clarity is required on how thisinformation will be utilised and fed into regional development planning
Often perceived as a govt role to undertake SEA but industry have big partto play as potential information and study donors
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Slide 13ESIA Tullow Oil November 2010
Capacity
Oil and gas is dynamic and the development process is iterative
ESIA practitioners are challenged to build capacity (with support) to be ableto provide the service required
- Building the understanding of industry is crucial
- Capacity in relation to manpower requirements
- Limited supply of local specialist usually leads to delays
Infrastructure development- Key area that requires significant investment and lead time in developing regions,
particularly in the area of waste management, and oil spill response.
- This area is of key concern and needs to be at the forefront when discussing policy/ standard implementation
Regulatory capacity - large potential for single point failure, if keyindividuals are not available then no decision will be made.
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Slide 14ESIA Tullow Oil November 2010
Further Challenges
Oil and Gas development is emotive and therefore external factors lead toregulatory decisions being made with a political bias or based onperceptions.
Land and frameworks for acquisition, access, compensation andresettlement
Recognition of the role of NGO / CSO both by GOU and Industry
Managing expectations both internal and external
Learning from experience- Clearly define plans
- Recognise the need to resource teams early in order to provide internal supportbut more importantly to build capacity
- Dont tell show..
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Slide 15ESIA Tullow Oil November 2010
Summary
Not all negative, these challenges make it an area with huge potential
Communication between interested parties is crucial
Standards need to be developed which are realistic for the country ofoperation
Infrastructure development through partnerships is essential to success
Local Capacity Development crucial
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Slide 16ESIA Tullow Oil November 2010
Extras
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Slide 17ESIA Tullow Oil November 2010
Local Content delivers a Sustainable Supply Chain
Local Content is the Term given to Tullows commitment to create in country
capability in the oil industry.
It represents the opportunity to build a local oil infrastructure and supplybase to help Tullow control and reduce costs.
It also benefits local business and communities through:
- Local business development (goods and services)- Local employment (re-skilling, job development, redeployment)
- Sustainable local economic development
Tullow Local Content
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Slide 18ESIA Tullow Oil November 2010
Success to date
Uganda Ghana
48%
52% 62%
38%
Local SpendInternational Spend
Fuel
Emergency Services
Waste Management
Security
Medical
Crane
Hire
Personnel
Transport
Freight Forwarding
Custom
Clearance
Facilities
Management
IT
Services
Telecoms
Hotel/Accom.
Office
Supplies
HR
Unskilled
Labour
Training
General
Trades
Catering
Communications
Camps/Accom.
FPSO/Wellhead
Tangibles
Rig
Hire
Feed
Seismic
Services
Well
Services
Environmental Services
Int. Freight Services
Site Prep.
Field Construction
Specialist
Trades
InspectionsInfield
Transport
Spare
Parts
Infield
Services
Civil
Mechanical
Electricals
Mud/
Cuttings
ConstructionMaterials
SPECIALISTS
SERVICES
DIRECT
SERVICES
INDIRECT
SERVICES
Tullow has had great success in achieving high levels of spend with Local Companies
even though these early phases of field development usually include a large element of
specialist services or one-off constructions such Seismic surveys or Vessel construction.
We are focusing our efforts on improving
the local skill base through programs
such as Closing the Gap, which is
delivering training programmes to localcompanies to improve skills and
standards