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Crude oil	Reference price	Period used to calculate differential	Minimum volume for calculation of differential
Pierce	212 FOB*** pricing based upon the NDD*.	Rolling average of all AL cargoes in the 6 month period up to and including the month of lifting.	3 standard volume (200k bbls) AL cargoes**.

* Where a reference price is stated, this will be based upon LB Oil & Gas’s published daily North Sea Reference Value , with effect from 1 July 2006.

** Should the volume in the specified period be too small, include additional cargoes until the minimum volume has been achieved. »Ê¹ÚÌåÓýapp cargoes to use are those nearest to the specified period on a time basis.

Nearest on a time basis means;

• for cargoes preceding the specified period; in reverse date order
• for cargoes following the specified period ; in date order.

A cargo with the shorter time difference between it and the specified period will be used in preference to a cargo with a larger time difference, regardless of whether that cargo follows or precedes the period.

In case there are two cargoes with equal time difference, include both as additional cargoes

*** Where Pierce is sold CIF, the CIF element in the pricing formula will have to be identified and reported to LB OIL & GAS in the form PRT1A, to allow it to be removed from the calculation.