cinguetti reserves, page-10

Hi DF

Sorry for the delays.
I used 3.457 millon barrels as HDR share of production in the year ended 31 December 2006 at US$45/bbl and an opex of US$4.50. This gives a contribution to fixed cost and profits of US$140million in the 10 month period. GoM tax at 25% would be US$35million based on contribution but HDR are eligible to claim costs of US$90million as a tax deduction.

The Euroz report says "NB tax payments arise from 2007". To pay tax in 2007 they would need a contribution of more than US$220million in the 12 months to 31 December 2007. This would require a sale price of more tha $51/bbl on about 4.3million barrels.

I was originally using 5.2million bbl for 2007 and US$45/bbl but I reduced the rate by a factor of .8245 to fit in with the total reserves. At this stage, I am not sure how much oil will be produced or what the price might be in 2007 or subsequent years but the contribution must be at least US$220 in 2007 for HDR to pay Gom tax.

I hope this helps.

regards

Complex