Cost of production, page-16

Tim

In the early days of a new production facility, it is prudent to slowly introduce oil into the system to fix any problems that may become apparent. This phased process will also stop the reservoir from any substantial shocks, which could cause problems down the line. It is a bit like buying a new car and not running it at full speed for the first month or so. (simple I know, but the best I could come up with)

The slow process will also allow pressure depletion across the reservoir and limit (hopefully) the impact of water coning for an extended period.

Remember, this is an 11-year plus project, so we don't need it all on day one.

Hope this helps.

On the issue of operating costs, the vast majority will be related to the lease of the FSO and this will typically be based on a day rate for the vessel. These vessels don't come cheap and the charges are not related to the rate of production, so costs will be relatively fixed. My experience is that these costs will be reflected in the accounts of the JV parties, via future lease costs or a similar description. Look at PPP and AWE as examples for their Tui vessel.

I dont have the TAP accounts at hand, but I am surethat the numbers will be there, or will be in the 2014 accounts.

Cheers, Al