Building Trust Among Investors

• Thank you Gunnar Eckbo and congratulation with introducing the price on Iceland.

• Rabbe Lund Chairman of a Swedish/ Norwegian oil company, board member world leading geosciences company and an Oil service company.

Building Trust Among Investors

Trust not an easy concept (eg shipowner story)

Trust: One in which confidence is placed (Webster)

Building Trust Among Investors

• Investors : Different types requires different treatment.

• Examples: INC,TGS, PA

Building Trust Among Investors

• PA Resouces AB Oil and gas company founded 1994

• Listed Norway and Stockholm, >8000 shareholders

• Market cap. almost 1000 mill USD• Winner on Oslo Børs the last three years• Focused independant, innovative, international

E&P company• Objective: Deliver Profit and Growth

Company assets and locations of operation

Equatorial Guinea:- 2 exploration assets

Tunisia:- 6 producing fields- 2 discoveries- 4 exploration assets

Norway: - 1 development project - 1 exploration and discovery- 8 exploration licenses

Field development - Norway

Volve • Operator Statoil (49,6%), PAR

(10,0%).• Production from 3 wells

through a drilling& processing platform (jack-up rig) with a capacity of 80 000 bbls/d liquid. The processed oil is stored in a FSO .Expected peak production ca 50 000 bbls/d.

• Production start Q2-2007• Recoverable reserves ca 70

MBOE as per PDO 2005.

Development of the company- Production history, 1998 - 2005

Oil Production, PARE BOE Yearly

-

2 000 000

4 000 000

1998 1999 2000 2001 2002 2003 2004 2005 E2006

Production forecast

Avarage production per day, BOE/day

-

5 000

10 000

15 000

20 000

25 000

30 000

35 000

40 000

45 000

50 000

2005 2006 2007 2008 2009 2010 2011

Exploration, existing permitsZaratElyssaOselvarVolveDidonOnshore Tunisia

Strengths and opportunities– Strong Reserve Base - Not dependant on exploration success to

grow production

– As one of the largest oil producers in Tunisia, we have a solid platform for further expansion in the region

– In-house knowledge and competence

– Large industrial network - Strong deal flow

– An increasingly strong cash flow

– Access to capital markets

Building Trust Among Investors

• Experiences:• Create interest in the company• Be visible and invest a lot of time in road

shows and IR, Let the president talk. • Get profiled investors and at least several

finance houses to follow the stock.• Use the finance houses that serve you well• Get highly financially competent board

members with power in the financial market

Building Trust Among Investors

• Get board members with serious investment in the company and willingness to invest in new issues

• Board and managment must develop clear objectives and strategies together and communicate it.

• Guide intelligently

• Follow Corporate Governance

• Face the brutal facts

Building Trust Among Investors• Use the media, internet, shareholder presentations each quarter.• Make good presentations, quarterly and annual reports• Meet investors in person -trust is a feeling

• Few investors buy and hold -you need to meet potential investors all the time. Professional investors/fund is short term driven. You have to feed them all the time.

• Target the prefered investor composition as you move along

• If you may grow out of your current corporate advisors capacity, target the next level in time so capital can be raised fast if a golden opportunity present itself.

Building Trust Among Investors

• Build brick on brick

• Always make new issues at higher level than the previous

• Have good capital structure and sufficient funds for a rainy day

• Show that you follow your strategy, maintain financial control, have great ideas, act on it and create value

• Your trust building is a key issue for the Board – develop an alert list.

Building Trust Among Investors

• Conclusion:

• You can fool investors once, but to build a company you need their continuous support. Then you need to earn their trust by creating shareholder value as you move along

• THE ONLY WAY TO DO THAT IS TO PERFORME AND DELIVER WHAT YOU PROMISE