The following table provides a summary of the proved undeveloped reserves (PUDs) for our oil and gas activities at the end of the last two years:

In 2008, our PUDs decreased by 24 mmboe (increased by 13 after royalties). We converted 29 mmboe (26 after royalties) with the start-up of our Long Lake SAGD operations, the substantial completion of our Longhorn development project, and the remainder relating to ongoing development of various other properties. We had negative revisions of 14 million boe (13 after royalties) primarily at Ettrick, and we added 19 mmboe (51 after royalties) with the extension of the Long Lake reservoir. After-royalty changes reflect the impact of lower price-sensitive royalties for our Long Lake Project.

In Canada, our PUDs remained at 236 mmboe before royalties (increased 34 to 234 after royalties). At Long Lake, PUDs increased by 4 mmboe (37 after royalties) due to a 19 mmboe (19 after royalties) addition from ongoing delineation drilling, offset by a 15 mmboe reduction (18 increase after royalties) from conversion to proved with the ongoing start-up of SAGD wells. Other PUDs declined by 4 mmboe (3 after royalties) due to conversions in our coalbed methane properties and revisions in our heavy oil properties. The remaining PUDs are substantially all from Long Lake where we have 232 mmboe (230 after royalties) which are expected to be converted to developed over the next 20 years as we drill additional wells to provide feedstock to run the upgrader at capacity. Other PUDs relate to infill drilling, recompletions or facilities enhancements on our various CBM, heavy oil and natural gas properties. The majority of these PUDs are expected to be converted to producing reserves in 2009 and 2010.

In the United Kingdom, our PUDs decreased from 54 mmboe (54 after royalties) to 40 mmboe (40 after royalties). The decrease primarily reflects the reduction of PUDs at Ettrick. About 75% of the PUDs at December 31, 2008 relate to Buzzard while the remainder relate to Ettrick. At Buzzard, we converted 5 mmboe of PUDs to producing and added 3 mmboe for increased recovery factors on remaining undrilled locations. The Buzzard PUDs are expected to be converted to producing over the next few years as we drill additional wells and develop increased H₂S handling facilities to keep the platform operating at capacity. We expect to convert the majority of Ettrick PUDs to producing when production is initiated in 2009.

In the United States, our PUDs decreased from 20 mmboe (17 after royalties) to 11 mmboe (10 after royalties) largely relating to the completion of the development at Longhorn and conversion and revision of the remaining Gulf of Mexico shelf PUDs. Almost all of the remaining PUDs are located in the deep water of the Gulf of Mexico and relate to suspended production from hurricane damage in our Green Canyon blocks and Gunnison infill drilling. The majority of these PUDs are expected to be converted to producing reserves in 2009 and 2010.

In other countries, PUDs relate primarily to our Usan development, offshore West Africa.

Excluding Long Lake and Usan, we expect to convert over 90% of our PUDs to producing in the next three years. Usan will be converted by 2012 when it is expected to come on stream. Long Lake PUDs will be converted over the next 20 years as new wells are drilled to offset declines from the initial SAGD wells. At the same time, we expect our ongoing exploration and development activities to continue to add new PUDs.

During the past three years, our total PUDs before royalties increased from 180 mmboe to 318 mmboe (165 to 310 after royalties). As a result, our PUDs before royalties as a percent of total proved reserves excluding Syncrude increased from 38% to 48% (42% to 49% after royalties). During this time, we added 206 mmboe (179 after royalties) at our Long Lake Project from the reinstatement of proved reserves previously written off due to low year-end bitumen prices and another 96 mmboe before royalties (119 after royalties), related to our active development projects at Long Lake, Usan, Ettrick, CBM and Longhorn. We converted 164 mmboe before royalties (153 after royalties) to developed with the completion of development of our Buzzard, Farragon and Duart fields in the United Kingdom, Block 51 in Yemen, and ongoing development of work elsewhere.