1. Tanzania Oil and Gas Opportunities and Challenges
Mark Stearnes
03 October 2012

2. Legal notice
Certain statements included in this presentation contain forward-looking information concerning BG Group plc’s strategy, operations, financial performance or condition, outlook, growth opportunities or circumstances in the countries, sectors or markets in which BG Group plc operates. By their nature, forward-looking statements involve uncertainty because they depend on future circumstances, and relate to events, not all of which are within BG Group plc’s control or can be predicted by BG Group plc. Although BG Group plc believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Actual results could differ materially from the guidance given in this presentation for a number of reasons. For a detailed analysis of the factors that may affect our business, financial performance or results of operations, we urge you to look at the “Principal risks and uncertainties” included in the BG Group plc Annual Report & Accounts Nothing in this presentation should be construed as a profit forecast and no part of this presentation constitutes, or shall be taken to constitute, an invitation or inducement to invest in BG Group plc or any other entity, and must not be relied upon in any way in connection with any investment decision. BG Group plc undertakes no obligation to update any forward-looking statements. No representation or warranty, express or implied, is or will be made in relation to the accuracy or completeness of the information in this presentation and no responsibility or liability is or will be accepted by BG Group plc or any of its respective subsidiaries, affiliates and associated companies (or by any of their respective officers, employees or agents) in relation to it.

3. Agenda 1 BG Group 2 Offshore East Africa – upstream overview 3
Tanzania – success so far
Doing business in Tanzania (and wider East Africa) 4

4. BG Group – Who we are Market leader: Global gas major:
FTSE top ten company
Market capitalisation
Circa $70bn
Production approximately 70% gas; 30% oil
Global gas major:
Over employees; 65% outside UK
BG Group Global Gas Major 4

5. Countries of current operation
Global portfolio
Countries of current operation
BG Group countries
Trinidad &
Tobago
Egypt
Kazakhstan UK
India
Uruguay
Bolivia
Brazil
USA
Italy
Tunisia
Thailand
Singapore
Areas of PA
Norway
China
Madagascar
Chile
Australia
Tanzania
Kenya
BG Group is active in more than 20 countries across five continents 5 5

6. Demerger and development
Who we are
Demerger and development
1986
1997
1999
2000
2002
2005
BG Plc
BG Group Plc
British Gas
Lattice
National Grid Transco
National Grid
BG Group is renowned within the industry for its performance in finding and commercialising gas and for project delivery. Our strategy of focusing on connecting gas to high value markets has helped to transform our cost base and increase revenues for our shareholders.
This slide shows the history of the company since it was privatised in 1997 and the former British Gas utility split into two companies, BG Plc which became BG Group, and Centrica.
Centrica
A proven record of performance 6

7. Working sustainably Responsible conduct Responsible to our people
How we do it
Working sustainably
Responsible conduct
Integrity
Governance
Strategy/investment
Responsible to our people
HSSE, Recruitment
Training, development
Equality & diversity
Responsible to society
Human rights
Community relations
Capacity building
Investment
Environmentally responsible
Environmental impacts
Climate change Biodiversity
Responsible conduct
We have an established governance framework: Matches highest standards, robust assurance; Integrated with the business
Business Principles are the fundamental element in the governance framework: Owned, agreed and reviewed annually by the Board; Underpinned by Group Policies.
Board Sustainability Committee works to ensure that sustainability at the centre of BG Group’s business – also support EITI
Responsible to our people
Our objective is to avoid harm and provide healthy working conditions
14 Point Assurance Tool revised to aid assurance and drive behavioural improvement
Health risk assessments completed for all assets
Worldwide talent pool: International management; Diverse workforce; Opportunity for all
Developing employees: High quality training; Postings across Assets and Head Office
Responsibilities to society
Impacts: Social impact assessment; Human rights: Voluntary Principles on Security and Human Rights
Social investment: Assets produce 5-year Community Involvement Plans linking business and community needs
Environmentally responsible
96% of BG operated assets achieved ISO 14001: 2004 standards in 2009;
On target to achieve an ongoing reduction in our annual GHG emissions of 1 million tonnes by 2012.
The way we conduct business 7

8. Agenda 1 BG Group & Global LNG 2
Offshore East Africa – upstream overview 3
Tanzania – success so far
Doing business in Tanzania (and wider East Africa) 4

9. Oil and Gas East Africa Large Frontier plays
Sizeable blocks
Deep to ultra deep water
Several recent discoveries
Material resource potential
Multiple play types
Multi-TCF gas potential
Stable/ progressive governments
Favourably located for LNG markets
India and Asian Pacific
Kenya – Tullow: onshore oil discovery
Tanzania – BG: 6, Statoil: 2 deepwater gas discoveries BG
Mozambique – Anadarko & Eni discoveries
An exciting exploration “hot-spot”

10. Agenda 1 BG Group & Global LNG 2
Offshore East Africa – upstream overview 3
Tanzania – success so far
Doing business in Tanzania (and wider East Africa) 4

11. Tanzania – Deepwater activity
Incumbents
Smaller Africa focussed independents
Majors renewed interest
Some companies still targeting oil
Two producing gas fields with sufficient reserves for domestic demand
4th offshore deepwater licensing round planned in 4Q 2012
Block 12
Block 11
Block 10
Block 9
Block 8
Block 7
Block 6
Block 5
Block 4
Block 3
Two producing fields: Songo Songo &
Mnazi Bay
Block 2
Block 2 E.
Pande
Block 1

12. Success in first deepwater wells
Farm-in June 2010, 60% of Blocks 1, 3 & 4
BG Operatorship – 1st July 2011
Six successful wells
Gas discoveries
Still in exploration phase
Appraisal program in Q3 / Q4 2012
Also acquired substantial siesmic;5140 sq km 3D followed by 2,500 sq km 3D seismic in Block 1; evaluation ongoing
In-country presence in Dar es Salaam and Mtwara – high quality national staff
LNG Implementation Agreement and PSA gas terms already in place
Tanzania – Significant Progress in Just 12 Months
TANZANIA
MOZAMBIQUE
BG will spend $374m Gross or $199m over the $175m MWO amount. Moving away from 60/40 funding on that $199m means will spend $50m more net ($318m vs. $268m) or 25% of $199m.
Activity
BG Net
Gross
G&G seismic acquisition & processing 39 46
2010 Actuals 13 15
Pweza 38 45
Chewa 57 67
Chaza
109
128
Mobilisation + non well costs for 1st campaign 61 72
MWO COST
318
374
LLIs for 2nd campaign 14 16
Well drilling costs (Dec 2011) 9 10
Mobilisation + non well costs for 2nd campaign 62 73
Well drilling costs (Q1 2012) 87
102
489
575

13. Sharing the Operations Supply Base in Mtwara
BG Operates the Mtwara Supply base on behalf of other offshore Operators (Petrobras, Statoil, Ophir)
Upgrade commenced in 4Q 2011 to enable multiple drilling operations with improvements to benefit existing port users (cashew nut farmers)
Tanzanian Ports Authority plans to develop free trade port and export corridor

14. Agenda 1 BG Group & Global LNG 2
Offshore East Africa – upstream overview 3
Tanzania – success so far
Challenges 4

15. Capacity building initiatives
BG scholarship scheme with the British Council and Nelson Mandela African Institute for Science and Technology
Support for G&G studies at the University of Dar Es Salaam and University of Dodoma
Pilot project for long term industry vocational training with VSO and VETA
Mtwara road safety programme in partnership with National Institute of Transport
School support program in Mtwara
Marine Conservation and livelihoods project in partnership with Mnazi-Bay Ruvuma Estuary Marine Park
Several social investment initiatives have been launched both in Mtwara as well as Dar es Salaam.

16. Operational challenges – remote location
Lack of infrastructure and local service industries
Deep water drilling
Environmentally sensitive
Capacity and skills development
Piracy
Joint initiatives for:
Sharing port facilities in Mtwara
Mutual Assistance between IOCs/ use of best technology
Incident response (e.g. oil spill)
Cooperation with Tanzanian navy

17. Business Environment Challenges
Capacity and capability within Government and Parastatals
Stability of contractual environment
Levels of education and training within general population
Direct experience of Oil and Gas
Robustness of business systems and processes
HSSE

18. LNG will require huge investment
Upstream
Liquefaction
Shipping
Regasification
Markets
c % of investment
c % of investment
c % of investment
c. 8% of investment
$ million per exploration well (deepwater)
$ billion upstream development cost
2 - 6 sq. mile site
3,500 construction personnel
$ billion downstream development cost
$300+ million cost per vessel
$5 million voyage cost (fuel, port, charter, boil-off) to India
c.120 cargo loadings per year
1 LNG tank can store two Boeing 777’s
$600+ million investment
$ billion gross sales revenue over project life
Figures are highly variable depending on project scope and scale

19. LNG versus oil – illustrative cash flow
Based on a generic greenfield LNG project
LNG Expansion
Oil
Billion ($)
Time from discovery
of reserves
LNG
LNG development = longer lead times but significant long term benefits

20. LNG could deliver unprecedented benefits
Historic Foreign Direct Investment (FDI)
Positive impact on FDI, export earnings and government revenues
Enabling legislation needed to maximise benefits
Key challenges:
Long lead time
Political / institutional capacity
Petroleum sector reforms
Domestic energy expectations
Macroeconomic impacts
Exchange rate appreciation; “Resource Curse”
An LNG project in Tanzania would be transformational for the economy and the country
Proposed sector legislation / policies such as Gas policy, Gas Master Plan and Gas Act needs to be enabling and must encourage investments.
Source: IMF, International Financial Statistics
Tanzania has had no experience of such large projects

21. Thank you