Coral Energy Shell Trading Producer Services Wyoming Pipeline

Coral Energy / Shell Trading Producer Services Wyoming Pipeline Authority October 28, 2003

Overview Ø Coral Energy / Shell Trading is Royal Dutch Shell’s (“RD Shell”) North American natural gas and power marketing affiliate (RD Shell ownership @ 90. 8%) Ø Coral is contractually obligated to purchase RD Shell’s 2. 4 Bcfd of North American natural gas production Ø Coral is headquartered in Houston with offices in San Diego and Calgary Ø Shell Trading markets 9. 5 Bcfd of natural gas and 15 GWs of power Ø Coral is rated A- by S&P and A 1 by Moody’s 2

Overview Ø Coral’s core competencies are in the aggregation, marketing and price risk management of natural gas Ø We have developed the infra-structure, expertise and experience in operations and marketing to meet our contractual obligations to RD Shell Ø We leverage those resources and capabilities to provide a cost-effective market alternative to E&P companies Ø Including a comprehensive suite of services allowing Producers to focus their resources on E&P activities 3

Background Ø RD Shell sought to reduce its cost structure and credit risk, maintain high production capacity factors and focus more resources on E&P activities Ø Through Coral, RD Shell out-sourced its North American natural gas marketing functions: Ø Coral is contractually obligated to purchase all of RD Shell’s North American gas production at competitive prices Ø RD Shell realizes substantial cost reductions improving profitability Ø Credit risk is effectively transferred to and managed by Coral Ø High production capacity factors are maintained Ø More resources are available for E&P activities 4

Discussion Ø Significant infra-structure and resources are required to effectively market natural gas Ø These marketing efforts require substantial resources that could otherwise be available for E&P activities Ø We believe the primary goals of a Producer’s marketing efforts are to: Ø Sell every MMBtu produced Ø Receive a competitive price Ø Get paid Ø As well, the high capacity factor required in producing fields is not well matched to the load profiles of markets 5

Discussion Ø Without significant investment in storage and transport assets, Producer’s are limited in their ability to shape production to meet market load profiles Ø Further, Producer’s have substantial credit risk through their marketing efforts or require substantial back-office support to mitigate those risks Ø As such, and in our opinion, few Producers have sufficient scale and scope to support an effective marketing effort Ø For these reasons, aggregating production to a financially strong counter party: Ø Leverages core competencies Ø Reduces costs Ø Mitigates credit risk exposure Ø Increases profitability 6

Producer Services Ø Why Coral Energy / Shell Trading? Ø Scale & Scope: Coral markets 9. 5 Bcfd in North America Ø Geographic reach Ø Infra-structure, experience & capability Ø Marketing, Asset Management and Price Risk Management are competencies Ø Comprehensive Service Offering Ø Strong balance sheet and credit rating 7

Producer Services ØShell Trading Offers Marketing Services that: Ø Are comprehensive and flexible Ø Are cost-effective Ø Focus on maintaining or increasing production capacity factors Ø Eliminate credit and non-payment exposure Ø Lever core competencies Ø Involve transparent, competitive prices Ø Facilitate price risk management Ø Reduce costs, enhancing profitability Ø Support an increased focus on E&P activity 8

Contacts ØLaird Dyer (858. 320. 1536) ØBill Lyons (858. 526. 2155) ØErin Kenney (858. 526. 2116) 9