CONSOLIDATED BALANCE SHEETS
	Twelve months ended 31 December
(in NOK billion)	2008	2007	2006
ASSETS
Non-current assets
Property, plant and equipment	329.8	278.4	272.2
Intangible assets	66.0	44.9	31.2
Associated companies	12.6	8.4	8.6
Deferred tax assets	1.3	0.8	0.8
Pension assets	0.0	1.6	1.1
Financial investments	16.5	15.3	14.0
Derivative financial instruments	2.4	0.6	0.5
Financial receivables	4.9	3.5	4.3
Total non-current assets	433.6	353.5	332.6
Current assets
Inventories	15.2	17.7	15.3
Trade and other receivables	69.9	69.4	62.4
Current tax receivable	3.8	0.0	18.7
Derivative financial instruments	27.5	21.1	21.3
Financial investments	9.8	3.4	1.0
Cash and cash equivalents	18.6	18.3	7.5
Total current assets	144.8	129.8	126.2
TOTAL ASSETS	578.4	483.2	458.8

CONSOLIDATED BALANCE SHEETS
	Twelve months ended 31 December
(in NOK billion)	2008	2007	2006
EQUITY AND LIABILITIES
Equity
Share capital	8.0	8.0	8.0
Treasury shares	0.0	0.0	0.0
Additional paid-in capital	41.5	41.4	44.6
Additional paid-in capital related to treasury shares	(0.6)	(0.4)	(3.6)
Retained earnings	148.0	140.9	122.2
Other reserves	17.3	(12.6)	(3.4)
StatoilHydro shareholders' equity	214.1	177.3	167.8
Minority interest	2.0	1.8	1.6
Total equity	216.1	179.1	169.4
Non-current liabilities
Financial liabilities	54.6	44.4	49.2
Deferred tax liabilities	68.1	67.5	72.1
Pension liabilities	25.5	19.1	11.0
Accruals and other provisions	54.4	43.8	42.2
Total non-current liabilities	202.7	174.8	174.6
Current liabilities
Trade and other payables	61.2	64.6	55.6
Current tax payable	57.1	50.9	47.1
Financial liabilities	20.7	6.2	5.6
Derivative financial instruments	20.8	7.6	6.5
Total current liabilities	159.7	129.4	114.9
Total liabilities	363.4	304.2	289.4
TOTAL EQUITY AND LIABILITIES	578.4	483.2	458.8

	Year ended 31 December
Other financial information	2008	2007	2006
Net debt to capital employed (GAAP basis) (1)	17.7 %	13.9 %	21.4 %
Net debt to capital employed (2)	17.5 %	12.4 %	20.5 %
After-tax return on average capital employed (GAAP basis) (3)	21.0 %	17.7 %	22.7 %
After-tax return on average capital employed (4)	21.1 %	19.9 %	22.9 %
(1) As calculated according to GAAP. Net debt to capital employed is the net debt divided by capital employed. Net debt is interest-bearing debt less cash and cash equivalents and short-term investments. Capital employed is net debt, shareholders’ equity and minority interest. (2) As adjusted. In order to calculate the net debt to capital employed ratio that our management makes use of internally and which we report to the market, we make adjustments to capital employed as it would be reported under GAAP to adjust for project financing exposure that does not correlate to the underlying exposure and to add into the capital employed measure interest-bearing elements which are classified together with non-interest-bearing elements under GAAP. See report section Use and Reconciliation of Non-GAAP Financial Measures for a reconciliation of capital employed and a description of why we make use of this measure. (3) As calculated in accordance with GAAP. After-tax return on average capital employed (ROACE) is equal to net income before minority interest and before after-tax net financial items, divided by average capital employed over the last 12 months. (4) As adjusted. This figure represents ROACE computed on the basis of capital employed, adjusted as indicated in footnote 2 above. See Use and Reconciliation of Non-GAAP Financial Measures for a reconciliation of return on average capital employed and a description of why we make use of this measure.

	Year ended December 31,
in (%)	2008	2007	2006
Ratio of earnings to fixed charges	52.1 %	19.6 %	21.2 %
Based on IFRS. For the purpose of these ratios, earnings consist of the income before (i) tax, (ii) minority interest, (iii) amortization of capitalized interest and (iv) fixed charges (which have been adjusted for capitalized interest) and after adjustment for unremitted earnings from equity accounted entities. Fixed charges consist of interest (including capitalized interest) and estimated interest within operating leases.

Cash flows from operating activities

Our primary source of cash flow consists of funds generated from operations. Cash flow provided by operating activities was NOK 102.5 billion in 2008, compared to NOK 93.9 billion in 2007. The NOK 8.6 billion increase was due to an increase in cash flows from underlying operations of NOK 44.1 billion and cash flows from other non-current items related to operating activities of NOK 5.9 billion. These effects were partly offset by an increase in taxes paid of NOK 37.2 billion and negative cash flows from changes in working capital of NOK 4.3 billion.

Net cash flows generated from operations for 2007 were NOK 93.9 billion, compared to NOK 88.6 billion in 2006. The increase of NOK 5.3 billion in cash flows from operating activities from 2006 to 2007 was mainly due to changes of NOK 12.4 billion in working capital, a decrease of NOK 8.6 billion in non-current items related to operating activities and a decrease of NOK 5.8 billion in taxes paid. These increases were partly offset by a decrease of NOK 21.5 billion in cash flows from underlying operations.

	Twelve months ended 31 December
Condensed cash flow statement (in NOK billion)	2008	2007	Change	2006	Change
Cash flows from underlying operations	239.9	195.7	44.1	208.6	(12.8)
Cash flows from (to) changes in working capital	(3.8)	0.5	(4.3)	(11.9)	12.4
Taxes paid	(139.6)	(102.4)	(37.2)	(108.2)	5.8
Other changes	6.1	0.1	5.9	0.1	(0.0)
Cash flows provided by operations	102.5	93.9	8.6	88.6	5.3
Acquisitions	(13.1)	0.0	(13.1)	0.0	0.0
Additions to PP&E and intangible assets	(76.2)	(75.5)	(0.6)	(59.9)	(15.7)
Proceeds from sales	5.4	1.1	4.3	3.4	(2.3)
Other changes	(1.9)	(0.7)	(1.3)	(0.7)	0.1
Cash flows to investments	(85.8)	(75.1)	(10.7)	(57.2)	(17.9)
Net change in long-term borrowing	(0.3)	(1.2)	0.9	(2.2)	1.0
Net change in short-term borrowing	10.4	0.8	9.7	(9.7)	10.5
Dividends paid	(27.1)	(25.7)	(1.4)	(17.8)	(7.9)
Other changes	(0.1)	18.1	(18.3)	(1.8)	19.9
Cash flows used in financing activities	(17.0)	(7.9)	(9.1)	(31.4)	23.5
Net increase (decrease) in cash flows	(0.3)	10.9	(11.2)	0.0	10.9

Cash flows used in investing activities

The cash flow used in investing activities was NOK 85.8 billion in 2008, compared to NOK 75.1 billion in 2007. The NOK 10.7 billion increase is mostly related to the NOK 13.1 billion in payments related to recent acquisitions, NOK 3.6 billion in increased investments in other intangible assets and NOK 2.3 billion in increased capitalisation of exploration expenditures, partly offset bya reduction of NOK 5.3 billion in lower investments in property, plant and equipment and NOK 4.3 billion in higher proceeds from sales of assets.

Approximately 50% of the investments in 2008 are investments in assets expected to contribute to growth in oil and gas production, while approximately 35% relate to investments in currently producing fields. The remaining 15% represent investments in StatoilHydro's other activities.

Net cash flows used in investing activities amounted to NOK 75.1 billion in 2007, compared with NOK 57.2 billion in 2006. The NOK 17.9 billion increase was mostly related to NOK 15.7 billion in higher investments in property plant and equipment and NOK 2.3 billion in less proceeds from sales of assets in 2007 compared with 2006.

Gross investments are defined as additions to property, plant and equipment (including intangible assets and long term share investments) and capitalised exploration expenditure. Gross investments were NOK 95.4 billion in 2008, compared to NOK 75.0 billion in 2007. The difference between cash flows used in investing activities and gross investments in 2008 compared to 2007 was related to the acquisition of assets and proceeds from sales of assets.

Gross investments amounted to NOK 75.0 billion in 2007, compared to NOK 64.3 billion in 2006.

	For the year ended 31 december
Gross investments (in NOK billion)	2008	2007	Change	2006	Change
E&P Norway	34.9	31.1	12 %	29.2	6 %
International E&P	48.7	36.2	35 %	28.9	25 %
Natural Gas	2.0	2.1	(6 %)	3.2	(34 %)
Manufacturing & Marketing	8.5	4.8	76 %	2.5	93 %
Other	1.3	0.8	73 %	0.5	63 %
Total gross investments	95.4	75.0	27 %	64.3	17 %

The difference between cash flows used in investing activities and gross investments in 2007 was mainly related to the effects of changes in long-term loans granted and other long-term items offset by proceeds from the sale of assets. In addition to the investments included in the table above, NOK 2.4 billion in LNG-related assets has been transferred from E&P Norway to the Natural Gas business area.

	For the year ended 31 December
Reconciliation of cash flow to gross investments (in NOK billion)	2008	2007	2006
Cash flows to investments	85.8	75.1	57.2
NCS portfolio transactions	0.0	0.0	0.1
Capital leases	0.0	0.0	2.4
Proceeds from sales of assets	5.4	1.1	3.4
Other changes in non-current loans granted and JV balances	4.2	(1.2)	1.2
Gross investments	95.4	75.0	64.3

Cash flows used in financing activities

Net cash flows used in financing activities in 2008 amounted to NOK 17.0 billion, compared to NOK 7.9 billion in 2007. The NOK 9.1 billion increase was mainly related to a decrease in the demerger balance with Norsk Hydro of NOK 18.7 billion in combination with increased dividend paid NOK 1.4 billion. These effects were partly offset by increased financial liabilities of NOK 10.5 billion in 2008, mainly related to collateral and commercial papers.

New long-term borrowings at 31 December 2008 were NOK 2.6 billion, compared to NOK 1.7 billion at 31 December 2007. The repayment of long-term debt at 31 December 2008 was NOK 2.9 billion compared with NOK 2.9 billion at 31 December 2007.

Cash flows used in financing activities in 2008 included a dividend of NOK 27.1 billion paid by Statoil ASA to shareholders related to the annual accounts for 2007, while the dividend paid by Statoil ASA to its shareholders in 2007 relating to the annual accounts for 2006 was NOK 25.7 billion.

Net cash flows used in financing activities in 2007 amounted to NOK 7.9 billion, compared to NOK 31.4 billion in 2006. The decrease in cash flows used in financing activities from 2006 to 2007 was mainly related to the settlement of the demerger balance with Norsk Hydro ASA on 1 October 2007, which was partly offset by increased dividends paid in 2007 compared to 2006.

New long-term borrowings as of 31 December 2007 were NOK 1.7 billion, compared to NOK 0.1 billion at 31 December 2006. The repayment of long-term debt at 31 December 2007 was NOK 2.9 billion compared with NOK 2.3 billion at 31 December 2006. Cash flows used in financing activities in 2007 included a dividend of NOK 25.7 billion paid by Statoil ASA to shareholders related to the annual accounts for 2006, while the dividend paid by Statoil ASA to its shareholders in 2006 relating to the annual accounts for 2005 was NOK 17.8 billion.

Current items

Current items (total current assets minus total current liabilities) were negative NOK 14.9 billion at 31 December 2008, compared to positive NOK 0.4 billion at 31 December 2007.

The change was mainly due to an increase in current liabilities such as accounts payable of NOK 3.8 billion, taxes payable of NOK 6.1 billion, derivatives of NOK 13.1 billion, collateral of NOK 7.7 billion, commercial papers of NOK 3.0 billion and a current portion of non-financial liabilities of NOK 4.0 billion, in combination with a decrease in inventories of NOK 2.5 billion. These factors were partly offset by a decrease in accounts payable with related parties of NOK 7.2 billion in combination with an increase in current assets such as accounts receivable of NOK 2.9 billion, joint venture receivables of NOK 1.0 billion, derivatives of NOK 6.4 billion and current financial investments of NOK 6.4 billion.

Current items were NOK 25.5 billion as of 31 December 2007, compared to NOK 43.8 billion as of 31 December 2006. The decrease in net non-current financial liabilities from 2006 to 2007 was mainly related to an increase of NOK 13.1 billion in liquid assets, in combination with a decrease of NOK 4.8 billion in gross non-current financial liabilities due to the weakening of the USD in relation to NOK during 2007.

We believe that taking into consideration StatoilHydro's established liquidity reserves (including committed credit facilities), working capital, credit rating and access to capital markets, we are well positioned to execute the planned long-term funding in the first half of 2009. Our sources of liquidity are described below.

Liquidity

Our annual cash flow from operations is highly dependent on oil and gas prices and our levels of production. It is only influenced to a small degree by seasonality and maintenance turnarounds. Fluctuations in oil and gas prices, which are outside our control, will cause changes in our cash flows. We will use available liquidity to finance Norwegian petroleum tax payments (due on 1 February, 1 April, 1 June, 1 October and 1 December each year), any dividend payment and investments. Our investment programme is spread over the year. There may be a gap between funds from operations and funds required to fund investments, which will be financed by short and long-term borrowings. We intend to keep ratios relating to net debt at levels consistent with our objective of maintaining our long-term credit rating at least within the single A category. In this context StatoilHydro carries out different risk assessments, some of them in line with financial matrixes used by S&P and Moody's, such as free cash flow from operations over net debt and net debt to capital employed.

Our long-term and short-term ratings from Moody's are Aa2 and P-1, respectively. Our long-term rating from Standard & Poor's was raised to AA- in August 2007, reflecting the majority ownership by the Norwegian State. Standard & Poor's short-term rating of StatoilHydro is A-1+. The current rating outlook is stable from both agencies.

As of 31 December 2008, we had liquid assets of NOK 28.4 billion, including NOK 18.6 billion in cash and cash equivalents and NOK 9.7 billion of current financial investments (domestic and international capital market investments). Approximately 29% of our liquid assets were held in EUR-denominated assets, 6% in NOK and 58% in USD, 3% in GBP and 4% in other currencies, before the effect of currency swaps and forward contracts.

As of 31 December 2007, we had liquid assets of NOK 21.6 billion, including NOK 18.3 billion in cash and cash equivalents and NOK 3.4 billion of current financial investments (domestic and international capital market investments). Approximately 54% of our liquid assets were held in EUR-denominated assets, 26% in NOK and 20% in USD, before the effect of currency swaps and forward contracts.

Compared to year end 2007, current financial investments increased by NOK 6.4 billion during 2008, and cash and cash equivalents increased by NOK 0.4 billion. The increase of liquid assets during 2008 was mainly due higher cash inflows from increased revenues in 2008 compared to 2007, partly offset by higher investments in 2008 compared to 2007. The average liquids price increased from USD 72 (NOK 423) per barrel in 2007 to USD 97 (NOK 548) per barrel in 2008.

Our general policy is to maintain a liquidity reserve in the form of cash and cash equivalents on our balance sheet, and committed, unused credit facilities and credit lines in order to ensure that we have sufficient financial resources to meet our short-term requirements. Long-term funding is raised when we identify a need for such financing based on our business activities and cash flows, as well as when market conditions are considered favourable.

As of 31 December 2008, the group had USD 2.0 billion available in a committed revolving credit facility from international banks, including a USD 500 million swing-line facility. The facility was entered into by us in 2004, and, after exercising an extension option in 2006, it is available for drawdowns until December 2011. At year end 2008, no amounts had been drawn under the revolving credit facility. In 2008 we drew down a line of credit established in our favour on a bilateral basis by an international financial institution. The loan is denominated in USD and has a final maturity of five years.

StatoilHydro plans to issue bonds in 2009 to secure necessary financial flexibility going forward. As a part of this plan, the group utilised the updated EMTN program in March 2009 to issue a GBP 800 million bond with a 22 year tenure, a EUR 1.2 billion bond with a 12 year tenure and a EUR 1.3 billion bond with a six year tenure. See section 6.2.1 Financial risk and financial risk management - liquidity risk management for more information about liquidity.

Gross interest-bearing financial liabilities

Gross interest bearing financial liabilities were NOK 75.3 billion at year end 2008, compared with NOK 50.5 billion at the end of 2007. The increase of NOK 24.8 billion was mainly related to an increase in non-current financial liabilities by NOK 10.2 billion due to the weakening of the NOK versus the USD (NOK 1.59). In addition, cash collateral on financial counter parties and commercial papers increased by NOK 7.3 billion and NOK 3.0 billion, respectively in 2008.

Gross non-current financial liabilities were NOK 50.5 billion at year end 2007, compared with NOK 54.8 billion at the end of 2006. The decrease was mainly due to the weakening of the USD in relation to NOK in 2007 and the repayment of long-term borrowings in 2007. For risk management purposes, currency swaps are used to ensure that StatoilHydro keeps long-term interest-bearing debt in USD. As a result, most of the group's non-current financial liabilities are exposed to changes in the USD/NOK exchange rate.

Net interest-bearing financial liabilities amounted to NOK 46.0 billion at 31 December 2008, compared with NOK 25.5 billion at 31 December 2007. The increase was mainly related to an increase in gross financial liabilities, partly offset by an increase in cash equivalents and current financial investments of NOK 6.8 billion.

Net interest-bearing financial liabilities amounted to NOK 25.5 billion as of 31 December 2007, compared with NOK 43.8 billion as of 31 December 2006. The decrease was mainly due to an increase of NOK 13.1 billion in liquid assets and a decrease of NOK 4.8 billion in gross non-current liabilities, mainly due to the weakening of the USD in relation to NOK in 2007. (For a reconciliation of net non-current financial investments with gross non-current financial liabilities, see report section 4.3.3 Financial performance-Non-GAAP measures-Net debt to capital employed ratio for more information.)

The net debt to capital employed ratio, defined as net interest-bearing debt in relation to capital employed, was 17.5% as of 31 December 2008, compared with 12.4% as of 31 December 2007. The 5.1% increase was mainly related to an increase in net financial liabilities of NOK 20.5 billion, partly offset by an increase in cash equivalents and current financial investments of NOK 6.8 billion.

Our method of calculating the net debt to capital employed ratio includes certain adjustments, and it may therefore be considered to be a non-GAAP financial measure. The net debt to capital employed ratio without adjustments was 17.7% in 2008, compared with 13.9% in 2007. (See report section 4.3.3 Financial performance-Non-GAAP measures-Net debt to capital employed ratio for more information.)

The net debt to capital employed ratio was 12.4% as of 31 December 2007, compared with 20.5% as of 31 December 2006. The decrease in the net debt to capital employed ratio in 2007 was mainly related to a decrease in net debt and an increase in shareholders' equity.

The group's borrowing needs are mainly covered through the issuing of short-term and long-term securities, including utilisation of a US Commercial Paper Programme and a Euro Medium Term Note (EMTN) Programme (the limits of the programme being USD 4 billion and USD 6 billion, respectively), and through draw-downs under committed credit facilities and credit lines. After the effect of currency swaps, 100% of our borrowings are in US dollars.

Our financial policies take into consideration funding sources, the maturity profile of long-term debt, interest rate risk management, currency risk and management of liquid assets. Our borrowings are denominated in various currencies and swapped into USD, since the largest proportion of our net cash flow is denominated in USD. In addition, we use interest rate derivatives, primarily consisting of interest rate swaps, to manage the interest rate risk of our long-term debt portfolio.

New long-term borrowings totalled NOK 2.6 billion in 2008 and NOK 1.7 billion in 2007. The repayment of long-term debt at 31 December 2008 was NOK 2.9 billion compared with NOK 2.9 billion at 31 December 2007.

The company's central finance function manages the funding, liability and liquidity activities at group level based on our adopted financial policies.

Cash, cash equivalents and current financial investments were NOK 28.4 billion as of 31 December 2008, compared to NOK 21.6 billion as of 31 December 2007. The increase of NOK 6.8 billion was mainly due to higher cash inflows from increased revenues in 2008 compared to 2007, partly offset by higher investments in 2008 compared to 2007. The average liquids price increased from USD 72 (NOK 423) per barrel in 2007 to USD 97 (NOK 548) per barrel in 2008.

Cash and cash equivalents were NOK 18.6 billion as of 31 December 2008, compared to NOK 18.3 billion as of 31 December 2007. Current financial investments, which are part of our cash management, amounted to NOK 9.7 billion as of 31 December 2008, compared to NOK 3.4 billion as of 31 December 2007.