1

In late 2004, we acquired North Sea assets and began production from Block 51 in Yemen. In 2005, we sold producing properties in Canada and suffered hurricane-related downtime in the Gulf of Mexico. A full year’s production from the North Sea and Block 51 in Yemen offset declines caused by these events. In early 2007, the Buzzard field came on stream and offset declines from Masila in Yemen.

2

In the third quarter of 2005, we sold Canadian conventional oil and gas properties in Saskatchewan, British Columbia and Alberta producing 18,300 bbls/d. The results of these operations have been shown as discontinued operations.

3

In December 2004, we drew US$1.5 billion on unsecured acquisition credit facilities to finance the purchase of North Sea assets. The remainder of the purchase price was funded from cash on hand. The acquisition credit facility was repaid in 2005 with proceeds from the issuance of US$1.04 billion in senior notes in the first quarter and from asset dispositions in the third quarter. Our long-term debt increased in 2006 as a result of our capital investments, primarily at Buzzard and Long Lake. In May 2007, we issued US$1.5 billion of senior notes with US$250 million maturing in 10 years and US$1,250 million maturing in 30 years. In June 2007, we filed a universal base shelf prospectus in the US and Canada allowing us to potentially raise US$2.5 billion of debt, equity or other hybrid securities, should the need arise.

4

Quarterly dividends were increased to 5¢ per share in the second quarter of 2008.

5

During the third quarter of 2008, we received approval from the Toronto Stock Exchange for a Normal Course Issuer Bid that allows us to repurchase up to a maximum of 52,914,046 common shares for the period of August 6, 2008 to August 5, 2009. In 2008, we repurchased and cancelled 12,136,900 common shares for $338 million.