1. Public Relations Update Independent Petroleum Association of America March 09, 2006 Mike Linn, Chairman Barry Russell, President Midyear Meeting 2007

2. Political Turnover – House Speaker: Hastert – 100% vs. Pelosi – 28% Ways and Means Thomas – 100% vs. Rangel – 28% Energy & Commerce: Barton – 100% vs. Dingell – 28% Sbcmte on Env and Hazardous Materials: Gillmor – 83% vs. Solis – 28% Resources: Pombo – 100% vs. Rahall – 42% Transportation and Infrastructure: Young – 100% vs. Oberstar – 57%

3. Political Turnover – Senate Majority Leader: Frist - 100% vs. Reid – 33% Majority Whip: McConnell – 100% vs. Durbin – 44% Appropriations: Cochran – 100% vs. Byrd – 55% Finance: Grassley – 100% vs. Baucus – 88% Energy Domenici – 100% vs. Bingaman – 88% Environment & Public Works: Inhofe – 100% vs. Boxer – 33%

4. IPAA: On Guard Windfall Profits Tax Avoided Intangible Drilling and Development Cost Modifications Avoided It’s Only a Matter of Time

5. Other Expected Issues GLOBAL CLIMATE CHANGE 1.Clean burning natural gas should be an important part of any proposal. 2.Do no harm to American oil production. 3.Any proposal should be global.

6. Other Expected Issues –Air Emissions –Oversight and Funding of Federal Permitting Agencies (BLM, MMS) –Broader Royalty Reforms –Federal Funding of Research and Development

7. Ongoing Issues - Access

8. Lake Erie, Southern Ontario Red — Gas Pools / Green — Oil Pools 2,000 Wells Drilled since 1913 550 Producing Gas Today Canada Only U.S.

9. Ongoing Issues – Global Competition

11. The New Washington Our most feared slide--Now reality Control Changes-Agenda, framing the issues, hearings, oversight, committee make-up and oversight On positive side--vote margins closer than you would think from media accounts Leadership more liberal than group being led

12. New Rules PAYGO will have an impact on us Legislative Environment- Price Spike Laying the groundwork in advance

13. Actions and Activities Mobilize Rapid Response CEO Team to Testify Revitalize Key Man Program Strengthen Grass Roots Network Activate Coops Utilize our PAC

14. IPAA Advocacy Efforts Contacted 300 Congressional Offices Met with House Speaker Pelosi’s Staff Provided Materials to Hundreds of Reporters Grassroots Network sent Hundreds of Letters to Capitol Hill THE NEW YORK TIMES January 13, 2007 Oil Companies Attack Legislation Aimed at Tax Incentives WASHINGTON, Jan. 12 — The nation’s oil and gas companies, hoping to fend off an attack by Congress on their tax breaks and subsidies, angrily denounced an effort by House Democratic leaders Friday that would repeal billions of dollars worth of incentives and plow the money into renewable energy projects. “This bill takes capital from U.S. oil and natural gas companies that otherwise would be spent on domestic energy exploration,” said Barry Russell, president of the Independent Petroleum Association of America, which represents about 5,000 smaller oil and gas producers. “If the goal is to lessen our dependence on foreign oil, then this bill falls far short.”

15. Strong Points of IPAA an award winning staff of professionals, with decades of experience representing our industry 24/7 in Washington, DC a government relations staff, that combines expertise in technically complex areas like FERC, Tax, and Environmental regulations political experience on both sides of the aisle.

16. The Big Picture

17. Public Education and Manpower IPAA Education Center-Houston –Establishing Academy for Petroleum Exploration and Technology –Facilitating the addition of energy education curriculum in Houston Schools –Coordinating field trips/guest speakers

18. Public Education and Manpower National Educational Advocacy Program Targeted Television Ads in Texas Museum Programs-Kilgore, Woodlands, PA Science and Engineering Fair of Houston- 28,000 Projects submitted NEED-52,000 Classrooms nationwide World Affairs Council