1. Security of gas supply: The role of gas developments in the Mediterranean region Malta Energy Conference 2014 10-11 July, 2014 “Operators’ Perspectives for Upstream Developments: Risks and Rewards in the Levant Basin” Noble Energy International Ltd 1

2. Eastern Mediterranean 2 CYPRUS TRENCH LATAKIA RIDGE NILE DELTA LEVANT BASIN ERATOSTHENES HIGH Syrian Arc Trend Dead Sea Transform Temsah Trend Dalit Leviathan Tamar Cyprus Mari-B Noa

3. Major Levant Basin Discoveries 3

4. Levant Basin – History (1) Major oil and gas activity nearby (Egypt, Libya) Minor oil and gas finds in shallow water Deep water technology was barrier until 1990’s Offshore licensing in region: – Israel (negotiated awards) – Cyprus (2 licensing rounds, in 2008 and 2013) – Egypt (Nile Delta, Deep-water licensing rounds) – Lebanon (planned licensing rounds) – Turkey (negotiated awards) 4

5. Levant Basin – History (2) Commercial activities commenced with Noble’s Mari-B natural gas discovery in Israel in 243 m WD, in 2000 (1 TCF) – production started in 2004, supplying domestic power generation Ultra-deep-water era started with Tamar discovery in 2009, in 1,676 m WD (about 10 TCF, currently producing up to 1 BCFD) Leviathan discovered in 2010 in about 1,700 m WD, about 19 TCF, currently being appraised Aphrodite discovered in Cyprus Block 12 in 2011, also in about 1,700 m WD (3.6 to 6 TCF, mean of 5 TCF) Further drilling planned during 2014 and 2015 in Cyprus’ EEZ 5

6. Levant Basin Commercialization (1) Currently about 40 TCF have been discovered in Israel and Cyprus Tamar has commenced production (subsea tieback to platform, pipeline to shore) Other fields being appraised Commercialization concepts under consideration: – Onshore LNG – FLNG – CNG – Regional pipelines – Petrochemical/fertilizer projects 6

7. Levant Basin Commercialization (2) Commercialization concepts: ConceptProsCons Onshore LNGMax flexibility Max Capex FLNGGood flexibilityMax Capex CNGLower Capex, fasterLimited reach PipelinesLower Capex, fasterSingle buyer Petrochemical/fertilizerGrow local industryRequire cheap feedstock 7

8. Levant Basin Hurdles Physical – Water depth (>2000m to Cyprus, >3000m to Greece) – Rugged, tectonically active seabottom – Distance to shore (can be >180 kms) Commercial – In some cases, small domestic markets require export projects to justify high development costs – High Capex for LNG – Emerging technology issues for FLNG and CNG – Lack of existing infrastructure 8

9. Potential Gas Pipeline Route Cyprus Block 12 to Vasilikos 9

10. Cyprus – Seafloor Tectonics 10

11. Cyprus – Seafloor Canyons 11

12. Financing of Energy Projects Generally, high-Capex oil and gas industry projects require some portion of outside financing International lenders look for: – Operator with good track record – Government contract with strong stabilization clauses – Sufficient gas resource to cover gas supply contract during the plateau production phase – “Skin in the game,” investment by co-venturers – Alignment between upstream and midstream parties – Well-structured GSPA’s 12

13. Environmental, Health & Safety (EHS) and Training EHS – Regulatory environment in East Med is evolving to fully address oil and gas industry activity REMPEC (Malta) facilitating implementation of offshore regulations EU Safety Directive being extended to East Med EU has signed Offshore Protocol for the Med – Establishing Environmental Emergency Management Preparedness and Response capabilities in East Med Training – In early stages of development for knowledge of the oil and gas industry – Government contract-mandated training programs being implemented – University programs specific to the industry have been initiated 13

14. Levant Basin Opportunities Formative hydrocarbons industry – can draw on more established projects in the surrounding regions (e.g. Egypt, Italy) Good probability of significant quantities of gas being found with additional drilling Possibility of deep oil New hydrocarbon projects can develop one or more industry hubs in the Levant Basin Long-lived hydrocarbon projects can assist in providing economic and political stability to the region, as well as energy resources to markets – Commerce is a great uniter – “All sides have something to gain…and something to lose” 14

15. The Levant Basin story is just beginning! Thank you for your attention. 15