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

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2 Overview Coral Energy / Shell Trading is Royal Dutch Shells (RD Shell) North American natural gas and power marketing affiliate (RD Shell ownership @ 90.8%) Coral is contractually obligated to purchase RD Shells 2.4 Bcfd of North American natural gas production Coral is headquartered in Houston with offices in San Diego and Calgary Shell Trading markets 9.5 Bcfd of natural gas and 15 GWs of power Coral is rated A- by S&P and A1 by Moodys

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

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

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

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

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7 Why Coral Energy / Shell Trading? Scale & Scope: Coral markets 9.5 Bcfd in North America Geographic reach Infra-structure, experience & capability Marketing, Asset Management and Price Risk Management are core competencies Comprehensive Service Offering Strong balance sheet and credit rating Producer Services

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

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9 Contacts Contacts Laird Dyer (858.320.1536) Bill Lyons (858.526.2155) Erin Kenney (858.526.2116)