Whether you are an employee or a shareholder, you invest in Nexen because there's value and excitement in what's next.

We build an exciting sustainable future, developing our inventory of world-class assets.
In 2007, Buzzard came on stream and contributed to our significant production and cash flow growth. The growth does not stop here however, as we have numerous identified projects and discoveries to provide continued growth into the next decade. This year we'll bring on Phase 1 of Long Lake, our first insitu oil sands project, and Ettrick in the North Sea. Next is Usan, offshore Nigeria where we've kick-started development of this world-class discovery. The field is expect to come on stream approximately four years from the award of major contracts and will ramp up to a peak production rate of 180,000 bbls/d (36,000 bbls/d net to Nexen). In the Gulf of Mexico, we plan to appraise our exciting discoveries at Knotty Head and Vicksburg to define their potential.

We rise to the challenge, turning mega projects, like Yemen and Buzzard, into legacies.
Legacy assets take a company to new heights. Over their lifetime, the value they contribute is far greater than when they were sanctioned. Consider Yemen. We have successfully operated there for more than two decades and still have about significant cash flow remaining-well beyond our initial expectations. Buzzard will follow suit. This asset has tremendous value and continues to get better. To date, we have already booked 35% more reserves than when we purchased it and the facility has proven to have additional processing capacity. Combine this with low operating costs, no royalties, and commodity prices almost three times greater than expected, and Buzzard should generate a wall of cash beyond our original expectations.

We commit to powerful strategies, applying technology that transforms industries, like at Long Lake.
Years ago we identified hurdles in developing oil sands, accumulated significant inventory and formed a strategy that disrupts conventional wisdom. Our strategy integrates steam-assisted-gravity-drainage (SAGD) and upgrading technology to produce the highest quality synthetic crude in the region. The patented process substantially reduces the need to purchase natural gas, resulting in an expected $10/bbl cost advantage. Phase 1 is just the beginning, as Long Lake will only develop about 10% of our oil sands leases. We can therefore potentially duplicate Long Lake up to 9 times. With a significant land position and cost advantage, our oil sands strategy is expected to generate massive rewards for many years.

We look beyond today, capturing early positions in deep-water and unconventional gas resource plays.
Our opportunity inventory is simply unbeatable in both quality and size. In the North Sea, we have hundreds of thousands of undeveloped acres, including nine licenses offshore Norway where we hope to drill our first well in 2009. We are a top ten deep-water leaseholder in the Gulf of Mexico and plan to drill three wells here in 2008. In Canada, we are one of only a few energy companies to have a significant shale gas position in northeast British Columbia and we are the first company developing coalbed methane (CBM) in the Mannville coals.

We build sustainable businesses, never compromising our values, safety, or the environment.
We are committed to exemplary corporate governance, environmental and social responsibility, and the health and safety of our workforce. We believe that over the long term, companies that steward to such business practices will be more sustainable and will outperform those with narrower priorities. But don't just take our word-see for yourself. We are recognized as a leader in corporate governance and sustainability reporting, winning awards for both. For the first time ever, our Scott/Telford offshore UK operations went two years without a lost-time injury. And we've been included in the Dow Jones Sustainability Index for the past seven years. Our employees also value us and once again named us one of the 50 Best Employers to work for in Canada.

We let our results speak for themselves.
In our 37-year history, we've been profitable every year except one and over the past 5 years, our stock price increased 275%, outperforming many of our peers and major indices.