Clear and Effective Governance

Tullow’s Board operates within a clear governance framework for the management of the Group, the safety of its operations and employees and the balance of countries, business units and individual assets within our portfolio. The Board has overall responsibility for the financial, business and operational risks facing the Group, and to ensure that Tullow consistently applies its focused growth strategy and maintains a long-term view in developing the business. The Board comprises 12 Directors with seven executive Directors and five non-executive Directors. Rohan Courtney is the Senior Independent Director and the Board operates three principal committees.

Directors’ biographies and Board Committee information are on pages 34 and 35 of the 2006 Annual Report and a detailed Corporate Governance Report is on pages 37 to 41. This and additional information on Corporate Governance information is also published on this website in the Corporate Governance section in About Us.

The Audit Committee monitors and reviews all financial reporting, systems of internal control, risk management and the Group’s relationship with the external auditor. The Audit Committee comprises five members, met four times during 2006 and the Chairman of the Committee is Rohan Courtney.

The Remuneration Committee is responsible for setting targets for performance-related pay, the design of share incentive plans and pension policy for executive Directors and senior group executives. The Committee also determines the remuneration of the Chairman, executive Directors and key senior management at Tullow. The Remuneration Committee comprises six members, met four times during 2006 and the Chairman of the Committee is Pat Plunkett.

The Nominations Committee focuses on Board structure, size and composition, succession planning for Directors and senior management, the selection and nomination of new Board members as appropriate and also makes recommendations on the composition of Board committees. The Nominations Committee comprises six members, met three times during 2006 and the Chairman of the Committee is Pat Plunkett.

Strong risk management

Tullow is exposed to a range of technical, geological, operational, political, environmental, health and safety and financial risks in the conduct of its day-to-day business. The Group seeks to manage and mitigate these risks by maintaining a balanced portfolio, through compliance with the terms of its licences, the application of established policies and procedures appropriate for an international oil and gas company, and the recruitment and retention of skilled personnel throughout its business. The Group’s principal risks are considered to fall into four key categories of strategic, financial, operational and external risks. Detailed information on risk is contained on page 41 of the Annual Report 2006.

Accounting policies and standards

The Directors are responsible for preparing the Annual Report and financial statements, which was published on 19 April, 2007. The Directors have chosen to prepare the accounts for the Group in accordance with International Financial Reporting Standards (IFRS), and in virtually all circumstances a fair presentation will be achieved by compliance with all applicable IFRS.

Political donations

There were no donations made to political parties during 2006.