Conoco first developed its presence in Nigeria in 1991, when it established Conoco Energy Nigeria Limited (CENL) and Conoco Exploration and Production Nigeria Limited (CEPNL). Both companies are subsidiaries of Conoco Inc., which is a Houston based major integrated energy company with operations in more than 40 countries. Conoco's mission in Nigeria is to grow a significant upstream business; a business that delivers value to all stakeholders, and is conducted safely, with high regard for both the environment and the communities in which we operate, and with the highest ethical standards.

Conoco's first project in Nigeria was participation in several shallow water indigenous concessions. CENL formed into the operations of four indigenous Exploration and Production companies as Technical Advisor (OPL's 204, 224, 453 and 74). Conoco shot several thousand kilometers of seismic data and drilled 9 exploratory wells. As a result of this work, Conoco relinquished its interest in OPL's 204, 224 and 453, and concentrated its efforts on development of the Ukpokiti field, which was discovered in OPL 74. Conoco, as technical advisor to Express Oil and Gas Company, developed Ukpokiti using a floating production, storage and offtake vessel, the Independence. This project achieved first oil only 14 months after the start of detailed engineering. The block was converted to OML 108, and Conoco became the first multinational technical advisor to bring an indigenous company into production. OML 108 began production in June 1999, and the field is producing about 20,000 BOPD. In 1993 Conoco's CEPNL affiliate signed a Production Sharing Contract (PSC) with NNPC to serve as operator of deepwater block OPL 220. Since that time Conoco has acquired extensive 2D and 3D seismic data and has drilled two exploratory wells. The first of these, Ebitemi 1, resulted in a gas discovery. The second of the two wells, Chota 1, was drilled in 3000 feet of water, and made a significant oil discovery. Chota will be further appraised this year.

Conoco continues to believe in the growth potential for Nigeria, and was actively involved in the 2000 Niger delta license round. Conoco is also active in the work to derive value from Nigeria's gas resources, and participated in a comprehensive NLNG feasibility study. Conoco's commitment to its stakeholders includes support for the communities in which it operates. As part of the Ukpokiti operations, we provide support for 21 communities. This support has included disaster relief, job opportunities and training, educational assistance in the form of scholarships and computer equipment, and infrastructure assistance. In addition, our Lagos headquarters has a very active, employee led philanthropic program. The philanthropic team has largely focused on the health and education of disadvantaged children, to provide support for the future of Nigeria.

Amongst Conoco's most important stakeholders are its employees, and we remain committed to growing the skills of our employees as we grow our business. About 90% of CENL's and CEPNL's employees are Nigerians, and Nigerian Nationals hold several key management and leadership positions. To encourage broad-based skills development, approximately 15 percent of Nigerian employees are on either training or permanent expatriate assignments overseas. Recognizing that employee development is not just about work, we also encourage overall health and well being, through an active, employee led Wellness team. This team organizes well-attended health seminars and sports events throughout the year. They have recently joined forces with the Philanthropic team to co-sponsor events, such as fun runs, which both promote fitness and benefit the community through participant donations.