While government can grant a company a permit to operate, it is the community that gives permission. We strive to earn that permission by building relationships based on integrity, trust and dialogue.

Community Projects in Colombia
In 2006, we invested in the Chaparral and Ataco municipalities adjacent to our Guaini well in the El Queso Block. Community investment projects totaling more than $163,000 included:

• School improvements and restoration
• Rebuilding road infrastructure
• Improving basic sanitation systems
• Job creation

Nexen Receives Woodlands County Business Award
Nexen was recognized at the Woodlands County Volunteer Appreciation dinner for its work in the community of Fort Assiniboine, Alberta. Nexen is the first recipient of the Woodlands County Business award, which recognizes a business which has significantly helped the community toward sustainability. The Fort Assiniboine region is home to a number of Nexen’s coalbed methane projects.

The nomination recognizes not only Nexen’s financial contributions to the community but also our participation and involvement in the success of community projects. Nexen’s contributions include the Pembina Hills Energy Education Program, production of community marketing, tourism and drama videos, development of a community calendar in conjunction with the school art program and participation in community events.

Managing Stakeholder Relations
The recent addition of a web-based stakeholder tracking system (STS) has enabled Nexen and its regulators to access public consultation data, records and emergency response contact information through a secured site in real time. This means that data are controlled electronically and accessible only to those who have the required security clearance. The value of this system lies in the accessibility of information; searches are easily undertaken and reports generated at the touch of a button. The success of this tool in our Canadian coalbed methane development led to its use in our sour gas operation near Calgary and the Long Lake oil sands development in northern Alberta. Testing of the STS is also underway in our coalbed methane development near Warrington, UK.

Long Lake Conducts Community Benchmarking Study
The operators of the Long Lake project commissioned public opinion firm Ipsos Reid to conduct in-depth research with citizens of northeastern Alberta to determine their thoughts and opinions of the project.

The first part of the research included 12 in-depth interviews with leaders in the communities of Anzac, Fort McMurray, Chipewyan Prairie Dene First Nation and Fort McMurray First Nation. Ipsos Reid then surveyed 100 residents from predetermined communities in northeastern Alberta. A good mix of respondents from the region was attained: Anzac – 47%; Fort McMurray – 28%; First Nations – 25%.

The three most common community concerns were lack of affordable housing, traffic and lack of infrastructure/facilities. One of the main challenges to resolving the community issues is a lack of certainty as to who is responsible for handling them. Another issue is that addressing one concern typically leads to the escalation of another. A lack of cooperation between industry and community leaders is also seen as a barrier.

Compared to other oil sands companies, Long Lake ranked third in corporate citizenship behind only well-established, long-term operators Syncrude (of which we are an original owner) and Suncor. With respect to communities closest to the Long Lake facilities, the three main expectations for the future would be to increase the amount of local hiring, focus on education, and donate time and money to help with community needs.

Continuing Community Investment in Yemen
The difficult living conditions for people in Yemen’s Hadhramout rural areas motivated Nexen and its partners to establish a number of infrastructure projects in the areas of education, health, water and electricity. In 2006, His Excellency Khalid Bahah, Minister of Oil and Minerals in Yemen, attended several inaugural ceremonies to celebrate Nexen-funded schools, water facilities and a road. These projects continue to generate a positive impression among local citizens and beneficiaries, which helps Nexen secure and sustain a social license to operate.

For the sixth successive year, Nexen and its Masila partners have sponsored scholarships for deserving Yemeni students. To date, some 90 students have taken advantage of this program to pursue post-secondary education in Canada.

Nexen UK Staff Volunteer for Children’s Program
More than two dozen staff at Nexen’s Aberdeen, Scotland office have volunteered to be part of the Determined to Succeed program at Mackie Academy – a secondary school in Stonehaven with about 1,300 students. The program incorporates the expertise and experience of workplace professionals to help young people prepare for the work world. Nexen volunteers are involved in mentoring, interview coaching and work placement.

Nexen Honoured by Energy Institute
Nexen’s Dr. Randy Gossen was awarded the Energy Institute’s Outstanding Individual Achievement award in November 2006. In accepting the award, Gossen recognized support from colleagues and Nexen’s commitment to operate with the highest level of integrity and social responsibility. The UK-based Energy Institute is the leading professional body for the energy industries.