EFTA01367340.pdf

31 May 2015 Integrated Oil US Integrated Oils North Sea Decline Rate Framework: We construct our decline rate analysis for the underlying asset base by adjusting the actual reported monthly production numbers for growth and maintenance outliers. Specifically, we extract production contributions from growth projects and normalize maintenance outages on a monthly basis over the examined time window (we use a normalized 3% of prior year adjusted production as a normal run-rate). We then calculate the resulting annual decline and find that over the last five years decline rates peaked in 2011 at 12% following the drop-off in investment in 2010. In our view, the 12% decline in 2012 is likely understated given the V- shaped recovery in the commodity. The UK Oil and Gas industry mentions a normalized decline rate of 10% in the UKCS with moderate levels of brown- field investing, though decline-rates on mature assets could be expected to reach declines of 15%-i with minimal capital influx. In our base case we assume a gradual reversion to a more normalized decline- rate of 12%. We estimate that a 1% change to our base case decline rates would impact 2017 production by 3%. In our view, a further devaluation of local currencies in the near-term, alongside capital reallocation tail-winds would present upside to brown-field investments. Figure 35: Brownfield spending has kept declines (ex new growth projects) at —10% YoY over the last 5 yrs. peaking in 201 I following a drop in prior year spending and dropping to 6.5% in 2014 on increased redeveloped activities. 3000 From 201B-2013 we estimate that oil decline 3000 rates (adjusting for outages and growth projects) averaged ^RN; however 2014 saw a 3400 reduced decline rate of - 6.S% as re developed projects in Norway began tampon 3200 3c00 r - -: I MO i j 1 I I - -I 2400 m 2200 2000 2000 2010 2011 2012 203 2014 Ad, Base oDechne OACtual San* Deaths &ink abeenbrit UK wand Git 11inegionRefiSurn Oinatnilt Med Maabliniii 1 Page 22 Deutsche Bank Securities Inc. CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0058873 CONFIDENTIAL SDNY_GM_00205057 EFTA01367340