Natural GasThe Natural Choice Now.Presented by:

Jim HackettChairman & CEOAnadarko Petroleum Corporation

Chairman, ANGA

ANGA Member Companies

DOMESTIC

Rise of the Shale Plays

Haynesville

Fayetteville

New Albany

Floyd-Neal

Marcellus/Devonian/Utica

WoodfordBarnett-Woodford

Eagle Ford / Pearsall

Barnett

Lewis

Cody

Mulky

Bakken

Antrim

Baxter-Mancos

MowryGammon

Mancos

Pierre

ABUNDANT

Total Potential Natural Gas Resources(trillion cubic feet)

Source: Potential Gas Committee Report, June 2009

*From 1990-2006, traditional resources include shale gas, which was not broken out separately by the PGC until 2008.

A New Age of Nat Gas Abundance

Potential Shale Gas ResourcesPotential Traditional Resources*Proved Reserves

Growing Role for Shale GasNorth American Dry Gas Productive Capacity

(BCF per Day)

Source: IHS CERA, Fueling the Future, 2010

Shale

Tight Sands

Coalbed Methane

Conventional

Associated

Fracture Stimulation

• Groundwater often found 50 – 600 feetGroundwater often found 50 – 600 feet

• Average shale gas well is >7,500 feetAverage shale gas well is >7,500 feet─ 1 ½ miles below the Earth’s surface1 ½ miles below the Earth’s surface

─ 1 ½ times deeper than the deepest part of the 1 ½ times deeper than the deepest part of the Grand CanyonGrand Canyon

─ More than 25 football fields laid out goal post More than 25 football fields laid out goal post to goal postto goal post

• Groundwater is protected by:Groundwater is protected by:─ A properly designed well is most effectiveA properly designed well is most effective

─ Subsurface fluid properties Subsurface fluid properties

─ Casing and cement provide Casing and cement provide

multiple barriersmultiple barriers

FRACTURE STIMULATION WATER USE VS. OTHER ENERGY TECHNOLOGIES

Energy Resource Range of Gallons of Water Used per MMBtu of Energy Produced

Deep Shale Natural Gas 0.60 - 5.8

Nuclear (uranium ready to use in a power plant) 8 - 14

Conventional Oil 8 - 20

Synfuel- Coal Gasification 11 - 26

Coal (ready to use in a power plant) 13 - 32

Oil Shale 22 - 56

Tar Sands 27 - 68

Synfuel- Fisher Tropsch (from coal) 41 - 60

Enhanced Oil Recovery (EOR) 21 - 2,500

Fuel Ethanol (from corn) 2,510 - 29,100

Biodiesel (from soy) 14,000 - 75,000

Source: The Groundwater Protection Council and the U.S. Department of Energy

JOBS

2.8 MILLION2008 Total Employment

2.8 MILLION2008 Total Employment

$385 BILLION2008 Total Value Added

$385 BILLION2008 Total Value Added

$181 BILLION2008 Total Labor Income

$181 BILLION2008 Total Labor Income

Natural Gas Employment(Average Annual Workers)

Direct Indirect Induced

Source: IHS Global Insight, 2009

2.8 Million American Jobs

POWERGENERATION

Today’s Electricity Mix

Source: EIA, 2009 Annual Energy Review

45% coal

23% natural gas

20% nuclear

7% hydropower

4% other renewablewind, biomass, geothermal and solar

1% other non-renewable

Ready Now

24 % Utilized

72% Utilized

397 GW

313 GW

Utilization of Electric Generation Capability(net generation as a percentage of net summer capacity)

Source: EIA, 2008 Electric Power Annual

CLEANER

Clean Energy

Natural Gas Coal

Carbon Dioxide 117,000 208,000

Carbon Monoxide 40 208

Nitrogen Oxides 92 457

Sulfur Dioxide 1 2,591

Particulates 7 2,744

Mercury 0 0.016

Natural Gas = Fewer Emissions(Pounds per Billion BTU of Energy Input)

Source: EIA, Natural Gas Issues and Trends, 1998

Meeting Clean Air Goals

EPA Non-Attainment Areas – June 2010

Source: EPA, Green Book, June 15, 2010

Utilities Going With Natural Gas

“Power plant developer will use natural gas instead of coal…”

Las Vegas Sun, 3/22/2010

“Power plant developer will use natural gas instead of coal…”

Las Vegas Sun, 3/22/2010

“Natural Gas Should Be Key In Energy Planning…”

San Antonio Express-News, 6/2/2010

“Natural Gas Should Be Key In Energy Planning…”

San Antonio Express-News, 6/2/2010

“Calpine Approved for 600MW Natural Gas-Fired Plant”

Power-Gen Worldwide, 2/4/2010

“Calpine Approved for 600MW Natural Gas-Fired Plant”

Power-Gen Worldwide, 2/4/2010

“Move to Natural Gas Helps Clear the Air…”

Denver Post, 4/4/2010

“Move to Natural Gas Helps Clear the Air…”

Denver Post, 4/4/2010

“Tennessee Valley to Build Natural Gas Power Plant”

Associated Press, 6/4/2009

“Tennessee Valley to Build Natural Gas Power Plant”

Associated Press, 6/4/2009

“Natural Gas-Fired Power Plant to be Built in Central PA”

WITF News, 2/22/2010

“Natural Gas-Fired Power Plant to be Built in Central PA”

WITF News, 2/22/2010

“Traverse City Light & Power Scraps Plan for Biomass Plant, Opts for Gas.”

Bloomberg, 6/28/2010

“Traverse City Light & Power Scraps Plan for Biomass Plant, Opts for Gas.”

Bloomberg, 6/28/2010

“N.C. Regulators Approve Plan to Build Natural Gas-Fueled Power Generation”

WWAY News, 6/9/2010

“N.C. Regulators Approve Plan to Build Natural Gas-Fueled Power Generation”

WWAY News, 6/9/2010

“Natural Gas is Good for Texas and the Environment”

Corpus Christi Caller-Times, 7/2/2010

“Natural Gas is Good for Texas and the Environment”

Corpus Christi Caller-Times, 7/2/2010

“Renewables Need Helping Hand From Gas”San Diego Union-Tribune, 5/23/2010

“Renewables Need Helping Hand From Gas”San Diego Union-Tribune, 5/23/2010

TRANSPORTATION

The Opportunity: Heavy-Duty Vehicles

Miles Traveled(average per year)

Fuel Economy(average mpg)

Fuel Consumed(average gallons per year)

Heavy-Duty Vehicles Vans, Pickups & SUVs Passenger Cars

Source: EIA Annual Energy Review 2009

Making a Difference

Converting just one heavy-duty waste truckfrom diesel to natural gas …

… offers the emissions reduction equivalent of taking 325 cars off the road.

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