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BNCC MEMBERSHIP LUNCHEON Tuesday, February 26th CFO Anders Kapstad. Side 1. Agenda. Norse Energy at a glance Norse’s Vision and Objectives Bovespa and the “Novo Mercado” “Novo Mercado” Requirements Company Preparation Costs Learning Lessons. ”All this and oil too”

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  1. BNCC MEMBERSHIP LUNCHEON Tuesday, February 26th CFO Anders Kapstad Side 1

  2. Agenda • Norse Energy at a glance • Norse’s Vision and Objectives • Bovespa and the “Novo Mercado” • “Novo Mercado” Requirements • Company Preparation • Costs • Learning Lessons

  3. ”All this and oil too” The Economist, 17th Nov 2007

  4. Company Overview NORSE ENERGY CORP. ASA Market cap: NOK 1.7 billion 2P reserves (2007): 48 MMBOE Contingent resources: 39 MMBOE Exploration potential: 232 MMBOE (unrisked, recoverable – pre-R9) Production Q4-07: 5,000 boe/day Norse Energy USA Norse Energy Brazil E&P (Operator) E&P (Partner) • Onshore gas production • Offshore gas and oil production Pipeline Gas marketing

  5. Norse Energy do Brasil at a Glance NORSE ENERGY CORP. ASA(Listed in Oslo) 100% NORSE ENERGY DO BRASIL E&P (Partner & Operator) • Offshore gas and oil production

  6. Why Brazil? • Large underexplored area • Only 22,000 wells drilled to date • Increasing government focus in Oil & Gas industry • Infrastructure build-up • Favorable macro-environment • Petroleum tax regime, strong currency, increasing GDP growth • “Petrobras announced Nov. 8 it has found between 5 billion and 8 billion barrels of light oil and gas at the Tupi field (..) the largest ever in deep waters. Perhaps more important, Petrobras believes Tupi may be Brazil's first of several new "elephants," an industry term for outsize fields of more than 1 billion barrels”. BusinessWeek, 19 November 2007 • “…there is the potential for many more discoveries on the scale of Tupi—which itself is the world's second-biggest strike in 20 years”. The Economist, 15 November 2007

  7. Norse’s Vision and Objectives • Listing the Brazilian subsidiary rather than follow-on offers in Norway, or BDR* of the Norwegian entity in the Brazilian market • Offer of pure Brazilian play, only pure E&P publicly listed company on Bovespa • Brazil as one of the most promising oil frontiers in the world (large potential, under explored basins) • Improved access to Brazilian and international capital markets *Brazilian Depositary Receipts – international stock values issued in Brazil by international based companies

  8. Bovespa and the Novo Mercado • Unique Brazilian stock exchange market • Largest stock market in Latin America (70% of the region’s traded volume) • 64 IPOs in 2007 • Novo Mercado (Tag Along) – listing segment where companies voluntarily follows additional corporate governance requirements • Stock value influenced by shareholders’ additional rights compared to other listings in Bovespa • Typical investor structure: 70 % international investors (qualified institutional buyers), 20 % Brazilian institutional Investors, 10 % Brazilian retail investors 2006 2007 2008

  9. Novo Mercado Requirements • Only common stocks issued (no preferred stocks) • Tag along rights to all shareholders of the company • Board of directors with minimum of five members. At least 20% of the board as independent BOD members • At least 25% of free float • Minimum 25 % of of net result dividend distribution • International standards of financial statements IFRS or US GAAP (requirement from 2009) • Yearly meetings with analysts and investors • Public annual calendar – BOD meetings, annual shareholders meeting, quarterly reports • Acceptance of Câmara de Arbitragem do Mercado to solve shareholders’ conflicts

  10. Company Preparation • Choose financial advisor • Largests investment banks in Brazil: • UBS Pactual • Credit Suisse • Banco Itau • Unibanco • Company valuation • Choose coordinators (sole/ joint bookrunner) • Choose local and international lawyers • Audited numbers less than 120 days before filing with CVM (Brazilian SEC) • Allocate a team responsible for IPO preparation • Required time : at least 6 months

  11. Costs: 5-6 % of total deal • Costs include: • Underwriting fees • Legal fees (US and Brazilian legal team) • Auditing costs • Printing • Travel • Bovespa related costs • Plus internal time

  12. Learning Lessons • Very demanding and timeconsuming process for the company and the involved employees • Make sure all company numbers and facts are available and well documented (legal requirements) • Challenging with prospectus in two languages for different markets • Important to have clear communication procedures between involved parties (company, lawyers, auditors, banks)

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