StatoilHydro entered the South Pars project in 2002 as operator for the development of the offshore part of the South Pars Phases six, seven and eight under a buy-back contract with a 37% share during the development phase.

Upon completing the development phase, StatoilHydro's obligation includes providing certain services to the National Iranian Oil Company (NIOC) during the operations phase; however, our involvement will be phased out once we have recouped our costs for the project.

Based on the two discoveries on the Anaran block, Azar and Changuleh, StatoilHydro discussed a Development Service Contract with NIOC.

StatoilHydro has an exploration and development service contract with NIOC for the Khorram-Abad block in Lurestan province in south-western Iran. The block covers 7400 square kilometres, and the work programme includes the acquisition of 600 square kilometres of 2D seismic data and the drilling of three exploration wells. The gathering of seismic data was completed in the fourth quarter of 2008. There are no firm plans at present to drill the first well in the work programme.

See report section 6.1.1 Risk review - Risk factors- Risks related to our business, for additional information concerning the risk of US sanctions related to activities in Iran.

The Company will not make any future investments in Iran under the present circumstances; however, it is committed to fulfilling its buy-back contract obligations, principally for the offshore part of the South Pars phases six/seven/eight project.