(NTR26290)

1. Project North Star
Discussion Materials

2. 1
 SPP runs a significant volume of North Dakota
Light (“NDL”) crude oil
 Recent test runs indicate SPP can run
XX% more NDL than it has historically
 Neither NTE or SPP have shipping capacity
in Enbridge’s Portal system proportional to
our supply needs
 Therefore, we are subject to “skimming”
by marketers
Situation Overview
 SPP is a final market for NDL producers
and has the potential to generate the
highest netback to the well head
 Trucking and shipping costs have been
escalating due to infrastructure bottleneck
 NTE’s BOD has approved the development
and construction of pipeline from ND to MN
sponsored by NTE
 We would like for Oxy to become
an anchor tenant
NDL – WTI Historical Differential

3. 2
Bakken Rail Alternatives
1: Cushing
• EOG unit train is 50,000
bpd unload
• WTI Cushing basis
is not optimal,
but “clears” supply
2: Gulf Coast
• Rail unload into Plains &
NuStar = XXX,XXX bpd
unload capacity
• Ideal alternative – LLS has
covered transportation
burden this year
3: Bakersfield
Rail switching, short lines,
lack of service makes
this difficult
4: Albany/PADD I
• New market to Global’s
Albany terminal—barged
to Sun Philadelphia
• Truck, rail, terminal to
barge is expensive
5: Anacortes
• Tesoro committed “space”
to Rangeland’s Epping
ND terminal
• Estimated 20,000 bpd
could land via rail
to Anacortes
Model Comments
• High transportation costs make rail
alternatives difficult
• Service is not reliable, shortage of
switch engines and destinations
• The LLS premium temporarily covers
rail transportation
• As the arbitrage weakens, it pressures
the cost of rail back to the lease in North
Dakota
$XX
$XX
$XX
$XX
$XX
$XX
Emerging rail from other fields
competes for the same unload
spots

4. Well Head
3rd Party Truck
$X.XX/bbl
3rd Party Truck
$3.00/bbl
$1.50/bbl
Transload Fee
LR
$3.50/bbl
Gathering
$0.71/bbl
NTE Pipeline
$2.40/bbl
Saint Paul Park
Refinery
Cottage Grove
Storage
Gathering
$.XX/bbl Tariff
Minnesota P/L
$X.XX/bbl Tariff
Enbridge Portal
$2.00 Shipper Margin +
$X.XX/bbl Tariff
Clearbrook Storage
3
Current Dynamics
Rail Crude & Pipeline Supply Options
Difference off WTI, $/bbl MPL Rail NTE P/L
Third Party Truck X.XX X.XX X.XX
Gathering Cost X.XX - X.XX
Shipper Margin X.XX - -
Transload Fee - X.XX -
Pipeline Tariff X.XX - X.XX
Rail Cost - X.XX -
MPL Tariff X.XX - -
SPP Delivered Cost (X.XX) (X.XX) (X.XX)