Creating a culture of innovation Colette Cohen Chief Executive Officer August 2016

Every 1bn barrels produced generates £50bn of value for the economy In context We’re already delivering with new projects coming out from the 2016 P&A Hackathon. These are now being fast tracked including the first project looking at reducing waiting on weather time for subsea equipment deployment. All activity in the short-term is designed to deliver a quick turnaround – and help to build collaboration within the industry. But we are also planning for the long term – establishing the fundamental / transformational projects that will shape the future of well activity including preparing a call for proposals on rigless P&A and evaluating an active hopper of other new opportunities. 1999 peak production 5 mmboe/day 2016 Production: 1.65 mmboe/day 43bn barrels since 1970 £330 billion in corporation tax 330,000 jobs in UK from oil & gas (~ population of 4th, 5th & 6th Scottish cities combined) 10-20 billion barrels potential remaining Every 1bn barrels produced generates £50bn of value for the economy

Creating value Anchor the supply chain in the North East of Scotland Create a culture of innovation that attracts academia and industry Unlock the potential of the UK North Sea Well construction represents between 30%-50% of capital expenditure (from well development through to abandonment) on the UKCS. Costs have escalated in recent years contributing to a reduction in drilling activity. As a result the industry is uncompetitive. To address this we aim to bring suppliers and operators together – to identify the main challenges and develop solutions – through new technology adoption, adaption or development. £180m City Region Deal public funding

Our business We inspire, accelerate and fund technology and innovation Solution Centres Centres of Excellence Well construction Asset integrity Small pools Decommissioning Digital World class R&D Partner universities Leverage capabilities Develop new skills Test, simulate, develop The Well Construction Solution Centre will plan, co-fund and manages technology development and deployment programmes focused on addressing problems and challenges identified in collaboration with the oil and gas industry. This will include facilitating faster adoption of technology, adapting existing technology from other industry sectors and developing new technology. We then work with our partners to implement technology development programmes to deliver these innovations into market. Technology Accelerator Innovation Hub Enable innovation Support SMEs Connect investors Co-fund and mentor Provide expertise Inspiring environment Learn and experience Ideas from other sectors Tech Talk programme Facilitated workshops We inspire, accelerate and fund technology and innovation

More than power, heat and transport The future COP 21 Ambitious targets 195 countries $16 trillion spend More than power, heat and transport Heating and transport: 50% - 60% Industrial: 20% - 40% Non energy: 10% - 20% Critical feedstock 6,000 everyday items Agriculture to plastics 60% of global power by 2040 $23 trillion on energy efficiency Driving change 150m electric vehicles by 2040 Oil demand up 11% by 2040 Gas demand up 33% by 2040 Composites worth $105bn by 2021 Meeting our needs for energy, materials and climate change

21st century oil and gas Technology can transform the oil and gas industry for the low carbon future

Pace and delivery since day one Early progress Pace and delivery since day one

Positive engagement with the industry Strong delivery Positive engagement with the industry

Building strong relationships Government Unviersities SMEs Regulators Research Organisations Trade Associations Working in partnership

Inspiring, accelerating and funding technology innovation Enabling MER UK Reduce the cost of wells by 50% Unlock the 3.4 boe in 210 small pools Eliminate vessel inspection by 2025 Wells Small Pools Asset Integrity Inspiring, accelerating and funding technology innovation

Delivery and look ahead Projects Members Field Trials Centre of Excellence Innovation Hub Positive start; lots still to do

Our purpose Making sure the North East of Scotland remains a great place to live, work and invest A not-for-profit research and development organisation